The court ruled that in proceedings under the Income Tax Act, claims of excessive assessments must be raised through the appeal process, and summary judgments can be granted if no triable issues are present.

JUDGMENT

Amarjeet Singh Serjit Singh J:

Introduction

[1] This is an application by the Government of Malaysia, the plaintiff for summary judgment against Sayyid Shah bin Abdullah, the defendant under O 14 of the Rules of 2012 for tax including penalties due and payable under the Income Tax Act 1967 (hereinafter all sections referred to are to the ).

[2] On 20 January 2022, I allowed the application and entered judgment as prayed. The reasons for my decision are as follows.

The Background Facts

[3] On 18 June 2019, the plaintiff filed a writ and statement of claim ("the instant action") pursuant to s 106 claiming RM14,463,166.14 being the amount of income tax and penalties imposed that were due and payable for various years of assessment by the defendant. Section 106 states:

(1) Tax due and payable may be recovered by the Government by civil proceedings as a debt due to the Government.

(2) .....

(3) In any proceedings under this section the Court shall not entertain any plea that the amount of tax sought to be recovered is excessive, incorrectly assessed, under appeal or incorrectly increased under subsection 103(3), (5) or (7).

[4] On 9 July 2019, the plaintiff entered judgment in default of appearance against the defendant. An application dated 31 March 2020 (encl 7) to set aside the judgment in default was dismissed by this Court. The defendant appealed to the Court of Appeal.

[5] On 26 January 2022, the Court of Appeal reversed the decision of the High Court. The following email was received by the registry of this Court on the same day from the Senior Assistant Registrar of the Court of Appeal informing of the said decision. The email was worded as follows:

Dengan hormatnya merujuk kepada perkara seperti di atas.

2. Pada 26 Januari 2022, rayuan ini didengar di hadapan Koram Panel Persidangan melalui aplikasi Zoom seperti berikut:

YA Dato' Mohamad Zabidin bin Mohd Diah, HMR

YA Datuk S Nantha Balan, HMR

YA Datuk Darryl Goon Siew Chye, HMR

3. Untuk makluman Tuan/Puan, Panel Persidangan telah secara sebulat suara memutuskan berikut:

a. Rayuan ini dibenarkan;

b. Keputusan Hakim Mahkamah Tinggi adalah diketepikan dan digantikan dengan perintah seperti dipohon di para 1 dan 2 pada Lamp 7;

c. Pernyataan Pembelaan hendaklah difailkan dalam masa 2 minggu dari tarikh perintah hari ini;

d. Kos sebanyak RM3,000.00 untuk prosiding rayuan ini sahaja dibayar kepada Perayu tertakluk kepada bayaran fi alokatur.

4. Tiada tarikh pengurusan kes ditetapkan oleh Mahkamah ini.

5. Mohon jasa baik Tuan/Puan untuk mengambii tindakan lanjut.

[6] As can be seen from the email, the judgment in default of appearance was set aside and the decision of the High Court was substituted by granting prayers 1 and 2 in encl 7. The defence was to be filed within 14 days from the date of the order which would be 9 February 2022. Thus, the High Court order was reversed and substituted with prayers 1 and 2 of encl 7 which areas follows:

1. Defendan diberi kebenaran untuk memfailkan Pembelaan di luar jangka masa.

2. Penghakiman ingkar Kehadiran terhadap Defendan pada 9 Julai 2019 diketepikan.

[7] The order of the Court of Appeal granted the defendant leave to file his defence out of time which was to be done on or before 9 February 2022. The defendant filed his defence on 8 February 2022.

[8] On 8 March 2022, a month after defence was filed, the plaintiff filed the instant application for summary judgment (enclosure 61). Both parties had also filed notices of intention to rely on the affidavits filed for the purpose of encl 7, namely encls 8, 9, 10, 20 and 21. in the affidavit in support (encl 62) a senior executive of the Inland Revenue Board averred that the amount claimed was for the following years of assessment: 2011, 2012, 2013 (additional), 2014 (additional), 2015 (additional), 2016 (additional) and2017 (additional) including penalties and the increases according to s 103 ("the said years of assessment"). The details of the amount assessed, the penalties charged and increases as pl