Taxpayer's claim of non-receipt of Notices of Assessment dismissed; court affirms validity of service under Income Tax Act provisions.

[1] The Plaintiff is the Government of Malaysia and more particularly the Inland Revenue Board of Malaysia. The Defendant is Central Strata Sdn Bhd (272403-P), a company incorporated in Malaysia under the Companies Act 1965 with its registered office at 90, 1st Floor, Jalan Sultan Yussuff, 30000 Ipoh, Perak.

Problem

[2] For the Year of Assessment 2002, 2003 and 2004, the accounting period or the taxable period of the Defendant was from 1 October 2001 until 30 September 2002, from 1 October 2002 until 30 September 2003 and from 1 October 2003 until 30 September 2004.

[3] The Defendant submitted to the Plaintiff an estimated income tax payable for Year of Assessment 2002 and 2004 in the Form for Estimated Tax on 30 August 2001 and 30 August 2003.

[4] The estimated income tax for the Years of Assessment 2002 and 2004 submitted by the Defendant was RM360,000.00 and RM0.00.

[5] The estimated income tax for Year of Assessment 2002 that has to be paid by instalments by way of equal monthly instalments on the 10th day of every month commencing the second month during the period is as set out below:

[6] On 24 October 2002 and on 12 September 2003 the Director General of Inland Revenue issued a directive and served by post to the last known address of the Defendant for the Defendant to pay the income tax for Year of Assessment 2003 and 2004 by way of instalments based on the dates and amount stated in the directive under s 107C(8) Income Tax Act 1967 as follows:

YEAR OF ASSESSMENT 2003

YEAR OF ASSESSMENT 2004

[7] The Defendant failed to pay the whole of the monthly estimates and monthly instalments of income tax for Years of Assessment 2002, 2003 and 2004 on the dates of payment and as a result, an increase of 10% amounting to RM36,000.00, RM36,000.00 and RM36,000.00 respectively were imposed and added to the amount payable as follows:

YEAR OF ASSESSMENT 2002

YEAR OF ASSESSMENT 2003

YEAR OF ASSESSMENT 2004

[8] The Defendant failed to submit the Company Income Tax Form (Form C) for Years of Assessment 2002, 2003 and 2004 to the Plaintiff on or before the last day 6 or 7 months after the close of the accounting period of the Defendant and as a result of which, for the Years of Assessment 2002, 2003 and 2004 the Defendant was assessed with income tax amounting to RM420,131.96, RM24,000.00 and RM24,000.00.

[9] According to the Plaintiff, the Notices of Assessment for Years of Assessment 2002, 2003 and 2004 stated above dated 19 January 2005, 22 June 2006 and 22 June 2006 were posted and served on the Defendant at the last known address.

[10] As the Defendant failed to pay the whole of the income tax which was still outstanding within 30 days from the date of service of the Notices of Assessment, an increased tax calculated at 10% amounting to RM42,013.19, RM2,400.00 and RM2,400.00 respectively were imposed and added to the overall income tax still outstanding for the Years of Assessment

[11] However the Defendant still failed to settle the whole of the income tax still outstanding during the period given and as a consequence an increase in tax of 5% amounting to RM23,107.25, RM1,320.00 and RM1,320.00 respectively were imposed and added to the overall income tax still outstanding for the Years of Assessment 2002, 2003 and 2004.

[12] The Plaintiff asserted that it is entitled to recover the amount of income tax still outstanding together with the 10% and 5% increases imposed on the Defendant as taxes due and owing.

[13] The Plaintiff stated that to date the Defendant has still failed to pay the Plaintiff the whole of its income tax due and owing to the Plaintiff for the Years of Assessment 2002, 2003 and 2004 including the increases imposed which together amounted to RM648,692.40.

Prayers

[14] In Encls 7 filed on