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2022 MarsdenLR 958
HIGH COURT MALAYA KUALA LUMPUR
BROADWAY METAL SDN BHD – Appellant
Versus
KETUA PENGARAH KASTAM DAN EKSAIS – Respondent
[Judicial Review Application No: WA-25-190-07/2020]
Judicial review upholds that a public authority must act within its legal powers and provide reasons for its decisions, particularly when such decisions cause harm to applicants.
Headnote:(A) Goods and Services Tax Act 2014 – Regulations 46 – Judicial review – Applicant sought to quash the Respondent's decision partially approving exceptional claims for input tax – Allegations of ultra vires actions and delays causing loss of claims. (Paras 2.1, 2.2, 23.2, 24(a))
(B)
Errors of Law – The Respondent applied an arbitrary formula not prescribed by law, impacting the legitimate claims of the Applicant unfairly. (Paras 25, 31)
(C)
Natural Justice – The Respondent failed to provide reasons for its decision, constituting a breach of natural justice concerning the procedural propriety. (Paras 38, 39)
Facts of the case:
The Applicant claimed input tax for GST paid prior to registration, but the Respondent partially approved the claim without clear reasoning, leading to a loss of the ability to claim full input tax due to regulatory delays.
Findings of Court:
The court found the Respondent's decision to be ultra vires and irrational, lacking legal grounding.
Issues
: Whether the Respondent acted beyond its powers and the implications of the failure to provide reasons for its actions.
Ratio Decidendi:
The court determined that the Respondent could not impose unnecessary formulas when the law did not permit such actions.
Result:
The Applicant's application for judicial review was allowed.
JUDGMENT
Introduction
[1] The Applicant had filed an application for judicial review proceeding (Encl 9) under O 53 of the Rules of 2012(ROC).
[2] The Applicant is seeking the following reliefs:
2.1 An order of Certiorari to remove into the High Court and quash the decision of the Respondent dated 14 February 2020 approving in part the amount of RM64,759.95 out of the total amount of RM99,813.23 claimed by the Applicant in its application for exceptional claims for input tax (Decision);
2.2 A Declaration that the Respondent's Decision is ultra vires the Goods and Services Tax Act 2014 and the Goods and Services Tax Regulations 2014 ;
2.3 A Declaration that the Applicant is entitled to the exceptional claims for input tax of RM99,813.23 (Exceptional Claims);
2.4 A Mandamus to compel the Respondent to make payment of the Exceptional Claims to the Applicant;
2.5 Costs; and
2.6 Such further directions, orders or reliefs as this Honourable Court may deem fit and proper in the circumstances of this case.
[3] In gist, the Applicant's judicial review application among others for an order of certiorari to quash the decision of the Respondent dated 14 February 2020 approving in part the amount of RM64,759.95 out of the total amount of RM99.813.23 claimed by the Applicant in its application for exceptional claims for input tax.
[4] After the hearing, I allowed the Applicant's application (Encl 9). This judgment will set out the grounds for my decision.
Background Facts
[5] The background facts of this case are adopted with and/or without modification from the Statement filed pursuant to O 53 r 3(2) of the ROC.
[6] Between the incorporation date of 28 June 2017 to the date of GST Registration of 1 December 2017, the Applicant had paid GST on the purchase and import of raw materials and capital goods for the purpose of the Applicant's business carried on in Malaysia.
[7] On 10 May 2018, the Applicant applied for exceptional claims for input tax on GST paid on the purchase and import of raw materials and capital goods of RM99,813.23 (Application for Exceptional Claims) in accordance with the Provisions of Law on Exceptional Claims
[8] The Applicant has met all the conditions of the Provisions of Law on Exceptional Claims, namely:
(a) the Applicant is a taxable person registered under s 21 of the GST Act 2014 on 1 December 2017 (GST No 000505327616);
(b) prior to its registration on 1 December 2017, the Applicant had paid GST on the purchase and import of raw materials and capital goods for the purpose of the Applicant's business carried on and still carrying on in Malaysia;
(c) as at 1 December 2017, the raw materials and the capital goods (i) had not been supplied or consumed, (ii) had not been used partially or incorporated into some other goods, or (iii) were not goods held for other than business use;
(d) the Applicant had provided all relevant tax invoices, K1 importation forms and other supporting evidence in the Application for Exceptional Claims;
(e) the Applicant's capital goods had been capitalised according to the standard of accounting principles in Malaysia by 30 November 2017 and the Applicant had submitted the details to the Respondent in the Application for Exceptional Claims
[9] The Applicant followed up on the status of the Application for Exceptional Claims via emails on 6 July 2018, 12 July 2018 and 18 July 2018. The GST officer via email on 18 July 2018 informed that he was reviewing the said application.
[10] On 1 September 2018, the GST Act 2014 was repealed.
[11] On 24 January 2019, the GST officer via email requested for the Applicant to submit further documents and records as described in the letter dated 'January 2018' (sic) for his further review. The Applicant provided the said documents and records on 31 January 2019 in 4 emails.
[12] Thereafter, almost 13 months passed with no communication and/or activity from the Respondent. In the interim, the Applicant sent a follow up email on 26 August 2019.
[13] On 4 Febr
