Mukhriz wins court nod to challenge RM5m additional tax assessment by IRB

KUALA LUMPUR, Jan 2 — The High Court today granted Datuk Seri Mukhriz Mahathir leave to initiate judicial review proceedings to quash an Additional Assessment Notice of over RM5 million issued by the Inland Revenue Board (IRB) for the assessment years 2017 to 2019.

Judge Datuk Amarjeet Singh allowed Mukhriz’s application for a temporary stay on the RM5 million payment, pending the hearing of the adjournment application scheduled for April 16.

In his decision, Amarjeet ruled that the case involved important issues that needed to be examined further in court.

Representing Mukhriz during today’s proceedings was counsel Nizamuddin Abdul Hamid, while senior federal counsel Wan Shahida Wan Omar appeared for the three respondents

On Dec 20, Mukhriz, 60, filed the judicial review application, naming the chief executive officer or director-general of Inland Revenue, Finance Minister Datuk Seri Anwar Ibrahim, and the Malaysian government as the first, second, and third respondents respectively.

In his application, Mukhriz, a businessman and politician, seeks to nullify the decision of the first respondent, the Inland Revenue chief executive officer or director-general, to issue an additional Assessment Notice for the 2017 to 2019 assessment years amounting to RM5,020,707.18. He argues that the decision was unlawful and unreasonable.

The Parti Pejuang Tanah Air (Pejuang) president further seeks a declaration that the penalty imposed under Section 113(2) of the Income Tax Act (ITA) 1967 is null and void, arguing that the imposition was ultra vires.

Mukhriz also requests declarations against the second respondent (Anwar), alleging abuse of authority. He claims that the second respondent improperly directed the first respondent to issue the Additional Assessment Notice and a certificate under Subsection 104(1) of the ITA 1967.

Mukhriz has also applied for a stay of enforcement on both the Additional Assessment Notice and the certificate pending the resolution of his judicial review application.

He contends that the first respondent erred in its assessment by incorrectly treating certain unexplained expenses as part of his total additional income, leading to an improper tax liability.

Mukhriz alleges that the first respondent acted improperly and recklessly by including proceeds from the disposal of his shares in OPCOM Holdings Berhad and dividends received from M Ocean Capital Sdn Bhd as taxable income, despite such income being non-taxable under the law.

He argues that this misclassification amounts to unfair and unequal treatment, citing the first respondent’s own statement that dividends and proceeds from share disposals are recognised as non-taxable income.

Furthermore, Mukhriz asserts that the Additional Assessment Notices for 2017 and 2018 were issued beyond the statutory limitation period prescribed in Section 91(1) of the ITA 1967. Under this section, such notices must be issued within five years unless fraud, willful default, or negligence by the taxpayer is proven.

The applicant emphasised that the first respondent has not provided any evidence or indication of fraud, willful default, or negligence on his part, rendering the issuance of the notices flawed and invalid. — Bernama