Arifin Zakaria J

The writ

By writ dated 25 January 1991, the plaintiff, the Government of Malaysia, claims against the defendant the total sum of RM442,349.43 being tax for the years of assessment from 1975 to 1985. Since the defendant failed to pay the said sum within the time stipulated under sub-ss(4) and (5A) of s 103 of the Income Tax Act 1967 ('the Act'), the plaintiff claims a further increase in the amount due and payable by 10% and 5% as provided for in the same subsections. The total amount which the plaintiff now claims as due and payable by the defendant is thesumof RM510,913.53. The plaintiff also claims interest of 8% per annum from the date of judgment to the date of realization and costs.

Defence and counterclaim

The defendant filed his defence and counterclaim on 21 February 1991 which was followed by the plaintiff's reply and defence to the counterclaim. However the plaintlff's reply and defence to counterclaim was only filed on 23 August 1991 after having obtained the court order for extension of time to file the same.

Enclosure 11A: Order 14 application

On 26 August 1991 the plaintiff made an application under O 14 of the Rules of the High Court 1980 ('the RHC 1980') for leave of this court to enter final judgment against the defendant for the total sum claimed. This application was supported by the affidavit of Mohamad Arsad bin Haji Said, a tax examiner attached to the Kuantan branch of the Department of Inland Revenue affirmed on 26 August 1991. In his affidavit, Mohamad Arsad alleged that the defendant had been duly served with all the notices of assessment through Messrs Coopers & Lybrand Taxation Services which was duly appointed by the defendant as his tax agent as evidenced by his letter (exh MAHS10). The plaintiff, vide the affidavit of Mohamad Arsad, alleged that the notices of assessment for the relevant years had not been returned to the department undelivered and therefore by virtue of s 145(2) of the Act they are deemed to have been received by the defendant.If the defendant was dissatisfied with the assessment the defendant was given the right of appeal under s 99 of the Act. However, the plaintiff contended that by virtue of s 103(1) of the Act, the assessed tax becomes due and payable as soon as the notice of assessment is served on the taxpayer, notwithstanding any appeal against the said assessment. Further, the plaintiff contended that by virtue of s 106(3) of the Act, the court should not entertain any plea that the tax sought to be recovered is excessive or incorrectly assessed under appeal or incorrectly increased under s 103(4), (5) or (5A) of the Act. The plaintiff also relied on the provisions of s 142(2) of the Act which provides that in a suit under s 106, the production of a certificate signed by the director general giving the name and address of the defendant and the amount of the tax due from him shall be sufficient evidenceof the amount so due and sufficient authority for the court to give judgment for that amount; and such a certificate is attached to the affidavit of Mohamad Arsad as exh MAHS13 (This power of the di rector general is exercisable by an assistant director of inlandrevenue under s 136(4) of the Act.) On the above premises the plaintiff contended that there was no defence to the plaintiff's claim and that the defence filed was merely to delay the payment of tax.

The defendant put in a lengthy affidavit in reply, objecting to the plaintiff's application on a number of grounds. The first objection raised by the defendant is the delay on the part of the plaintiff in making this application which was filed some six months after the defendant filed his defence. The defendant contended that the plaintiff had not anywhere in the affidavit in support of this application, given any explanation for the said delay. This, the defendant submitted, is fatal to the plaintiff's application.

It is not in dispute that there was in fact a lapse of six months between the