Najib and son fail to stay bankruptcy proceedings over tax bill

KUALA LUMPUR: Datuk Seri Najib Razak and his son Datuk Nazifuddin have failed to stay bankruptcy proceedings initiated by the Inland Revenue Board (LHDN) to claim RM1.69bil and RM37.6mil in unpaid taxes.

This follows the High Court’s dismissal of Najib and Nazifuddin’s application for a stay on the bankruptcy proceedings here yesterday.

Lawyer Muhammad Farhan Muhammad Shafee, who represented Najib and Nazifuddin, told the press that they had filed to stay the bankruptcy proceedings to allow the hearing on Najib’s tax assessment by the Special Commissioner of Income Tax (SCIT) to go on first.

He said at this point, Najib has yet to be declared bankrupt as he was only served with a notice of bankruptcy.

“This application was to stay the notice and subsequent proceedings because the issue of Najib’s tax (assessment) has not yet been fully resolved.

“The SCIT has not yet heard the merits of the tax assessment,” he said when met by the press after proceedings ended here yesterday.

However, the High Court’s decision, which deputy registrar Kamarul Aris Kamalluddin read, allows LHDN to proceed with the bankruptcy proceedings.

Muhammad Farhan said they would be appealing the dismissal with the High Court.

In 2020, two separate High Courts allowed the LHDN’s applications to enter a summary judgment to recover tax arrears of RM1.69bil from Najib and RM37.6mil from Nazifuddin for the assessment years between 2011 and 2017.

A summary judgment is obtained when the court decides on a case through written submissions without a full trial and without calling witnesses.

Through the LHDN, the government filed a bankruptcy notice in the High Court here on Feb 4, 2021, against Najib and Nazifuddin as debtors.

According to the notice, Najib was required to pay RM1.69bil with a 5% interest rate per annum on the total balance from July 22, 2020 (the date of the High Court decision) to Feb 4, 2021, which is RM45.9mil, and costs of RM15,000.

As of Feb 4, 2021, the amount payable is RM1,738,804,204.16.

Nazifuddin has to pay RM37.6mil with a 5% interest rate per annum on the total balance from July 6, 2020 (the date of the High Court decision) to Feb 4, 2021, which is RM1.1mil, and costs of RM10,000.

As of Feb 4, 2021, the amount payable is RM38,758,370.93.