JUDGMENT

Azizah Nawawi JCA:

Introduction

[1] This is an appeal against the decision of the learned High Court Judge delivered on 30 November 2021 allowing the appeal by the respondent, Penang State Development Corporation pursuant to s 39(1) of the Stamp Act 1949 ('the Stamp Act').

The Salient Facts

[2] The respondent is a corporation established under the Incorporation (State Legislatures Competency) Act 1962 and the Penang Development Corporation Enactment 1971 (PDC Enactment). The respondent is a State entity.

[3] Section 15C of the PDC Enactment stipulates that the respondent cannot apply for any loans except with prior written approval from the Minister of Finance (MOF), and the MOF may impose any conditions deemed necessary on such approval.

[4] According to the MOF Directive dated 19 November 1999 issued under para 14(1)(d) of the Second Schedule of the Incorporation (State Legislatures Competency) Act 1962, the State Government must provide an undertaking that it will fully guarantee the loan obtained by a State entity.

[5] The respondent had applied for and had obtained an Islamic Tawarruq banking facility of RM100,000,000.00 ("Loan") from Bank Islam Malaysia Berhad ("Bank")