Service of tax notices under the Income Tax Act is deemed valid upon posting to the taxpayer's last known address, regardless of actual receipt.

Introduction

[1]"In this world, nothing can be said to be certain except death and taxes".

[2] The above is a famous quote from the American statesman Benjamin Franklin in his 1789 letter to Jean-Baptiste Le Roy which said in part:

Our new Constitution is now established, and has an appearance that promises permanency; but in this world nothing can be said to be certain, except death and taxes.

[3] In fulfilment of the prophecy of certainty, the Malaysian government via the Lembaga Hasil Dalam Negeri ("LHDN") has now pursued the Defendant for unpaid tax by applying for summary judgment [Enclosure 42] pursuant to O 14 of the Rules of 2012 for recovery of tax arrears amounting to RM10,484,396.96 for the Defendant's failure to submit his Income Tax Forms as required under s 77 of the Income Tax Act 1967 for the Years of Assessment 2010 to 2015.

[4] The Defendant raised the following three alleged triable issues:

a) Whether the Notices of Assessment were effectively served and/or deemed to have been served on the Defendant by the Plaintiff;

b) Whether the amounts stated in the Notices of Assessment are conclusive and/or the assessment exercise for years 2010 to 2015 have been completed; and

c) Whether the Certificate of Indebtedness issued by the Plaintiff is defective.

[5] I heard counsel on 17 February 2023 and 20 March 2023 and allowed the summary judgment on 20 March 2023. The Defendant has filed an appeal to the Court of Appeal.

[6] These are my Grounds of Judgment.

Alleged Triable Issue [a]

Whether The Notices Of Assessment Were Effectively Served And/Or Deemed To Have Been Served On The Defendant By The Plaintiff

[7] I begin by examining the relevant sections under the Income Tax Act 1967 .

Sections 77 , 90(3), 96(1), 103(2), 106(1) And (3) And 145(1) And (2)(c) Of The Income Tax Act 1967

[8] Section 77 of the Income Tax Act 1967 provides:

Return of income by a person other than a company, trust body or co-operative society

77. (1) Every person, other than a company, trust body or co-operative society to which s 77A applies, shall for each year of assessment furnish to the Director General a return in the prescribed form:

(a) in the case of that person who is carrying on a business, not later than 30 June in the year following that year of assessment; or

(b) in any other case than the case in paragraph (a), not later than 30 April in the year following the year of assessmet...

[Emphasis Added]

[9] Section 90 (3) of the Income Tax Act 1967 states:

(3) Where a person for a year of assessment has not furnished a return in accordance with s 77 or s 77A, the Director General may according to the best of his judgment determine the amount of the chargeable income of that person for that year and make an assessment accordingly.

[Emphasis Added]

[10] Section 96 (1) of the Income Tax Act 1967 states:

(1) As soon as may be after an assessment, other than an assessment under subsection 90(1) and 91A(1), has been made, the Director General shall cause a notice of assessment to be served on the person in respect of whom the assessment was made.

[Emphasis Added]

[11] Section 103 (2) of the Income Tax Act 1967 states:

PART VII

COLLECTION AND RECOVERY OF TAX

Payment of tax

103. (1) Except as provided in subsection (2), tax payable under an assessment for a year of assessment shall be due and payable on the due date whether or not that person appeals against the assessment.

(2) Where an assessment is made under s 90(3), 91, 92 or 96A, or where an assessment is increased under s 101(2), the tax payable under the assessment or increased assessment shall, on the service of the notice of assessment or composite assessme