Wan Hamzah J:

The plaintiff sues the defendant for a total sum of RM105,911.85. By this summons the plaintiff applies for liberty to enter judgment on the ground that there is no defence to the action. The defendant opposes this application and asks for unconditional leave to defend. The sum claimed consists of amounts assessed under the Income Tax Act 1967 in respect of the year of assessment 1971 and the year of assessment 1974.

In respect of the year of assessment 1971 the Director-General of Inland Revenue issued to the defendant notice of additional assessment dated 27 July 1974, in which a penalty of RM93,983.50 was imposed under s. 113(2) of the Act. The notice of additional assessment shows certain payments previously made by the defendant as the result of which there is a small credit. This credit being taken into account, demand is made in the notice of additional assessment for payment of RM93,883.50 being the net amount of the s. 113(2) penalty. Subsequently the defendant paid a sum of RM600, leaving a balance of RM93,283.50, but failed to pay the balance within 30 days after the service of the notice of additional assessment. Therefore when bringing this action the plaintiff includes in the claim a further sum of RM9,328.35 being the amount of increase under s. 103(4) of the Act.

In respect of the year of assessment 1974 the Director-General served on the defendant a notice of additional assessment dated 14 September 1974 wherein a demand was made for payment of a total sum of RM134,206.95 consisting of s. 113(2) penalty of RM3,000 and the balance being tax. The defendant paid up the tax but not the penalty. Therefore the plaintiff sues the defendant for recovery of the penalty, and since the defendant had not paid the penalty within 30 days of the service of the notice of assessment the plaintiff also includes in its claim a further sum of RM300 being the amount of increase under s. 103(4).

The defendant contends that the Director-General can impose a penalty under s. 113(2) only if the conditions specified in s. 113 exist, and avers that in this case such conditions do not exist and therefore this issue should be tried before judgment can be entered. On the other hand the plaintiff contends that the s. 113(2) penalty of RM93,883.50 in respect of the year of assessment 1971 and RM3,000 in respect of the year of assessment 1974 became due and payable on the service of the notices of additional assessment and it is not open to the defendant to raise in this suit the ground that the imposition of the penalty was wrong and not in accordance with the provisions of s. 113. With this contention of the plaintiff I agree.

Section 125(2) provides:

Any penalty imposed on any person under s. 113(2) shall be collected as if it were part of the tax payable by that person, but shall not be treated as tax so payable for the purposes of any provision of this Act other than ss. 103 to 106.

So s. 103 applies to the s. 113(2) penalty as if the penalty were tax. Section 103(2) provides:

Subject to this section, tax payable under an assessment or a composite assessment shall on the service of the notice of assessment or composite assessment on the person assessed be due and payable at the place specified in that notice whether or not that person appeals against the assessment or composite assessment, as the case may be.

In the present case notices of the assessment of the penalty were served on the defendant and therefore the penalty has become due and payable on the service of the notice of assessment. Section 125(2) also makes it clear that s. 106 applies to the penalty. Section 106 provides:

(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 s. 103(