Shafee looking to delay claim, LHDN says on RM9.41 million tax arrears

The Inland Revenue Board (LHDN) has appealed to the Kuala Lumpur High Court to set aside Muhammad Shafee Abdullah’s application for a stay of proceedings in relation to its suit against him seeking payment of income tax arrears amounting to RM9.41 million, saying the lawyer’s intention is to delay the claim.

The matter was stated in the affidavit in reply sworn by LHDN’s Control Unit principal assistant director Shamsul Effendi Khamis, obtained by the media through a search of the court system.

LHDN, in filing the affidavit on Jan 26 on behalf of the government as the plaintiff, claimed that Shafee had also abused the court process.

“If this happens (stay of proceedings is allowed) the rights of the plaintiff and Malaysians will be denied and seriously prejudiced,” it said.

It also said te government needs adequate revenue for the development and smooth administration of the country as well as to look after the welfare of the people and address the impact of the Covid-19 pandemic which has led to healthcare crisis and economic uncertainty.

The court has set case management before senior assistant registrar Noordura Mohamed Din on Feb 16.

On Nov 3 last year, Shafee filed an application to temporarily suspend proceedings pending the disposal of his appeal to the Special Commissioners of Income Tax of Malaysia, in addition to other special circumstances to suspend the proceedings.

The lawyer said the application was also filed pending the outcome of the application by Najib Razak and his son Nazifuddin on the payment of income tax amounting to RM1.69 billion and RM37.6 million respectively to LHDN, to be heard in the Federal Court on Feb 16.

On Sept 27, 2021, LHDN requested that the suit against Shafee be decided through summary judgment, whereby the court decides without hearing the testimonies of witnesses.

LHDN filed the suit against Shafee on May 6, 2021, claiming that the lawyer had not settled the payment of tax arrears for five assessment years from 2011 to 2016.

Shafee, who is representing Najib in the case involving the misappropriation of SRC International and 1MDB funds, is also facing two charges of receiving RM9.5 million in proceeds from unlawful activities from Najib, and two charges of making false declarations to LHDN.