High Court allows Azeez to challenge IRB's revocation of RM4.8mil tax deal

KUALA LUMPUR: Former Lembaga Tabung Haji chairman Datuk Seri Abdul Azeez Abdul Rahim has obtained leave from the High Court to challenge the Inland Revenue Board's (IRB) decision to revoke his RM4.8 million tax settlement agreement.

Judge S. Indra Nehru also granted an ad interim stay pending further proceedings.

Azeez's lawyer, Datuk Amer Hamzah Arshad, said the court fixed Nov 16 for case management to set a date for the substantive judicial review hearing.

Azeez filed the application on Sept 6, challenging the Inland Revenue director-general's decision to revoke the settlement agreement dated Feb 9, 2022, which covered composite assessments for the assessment years 2011 to 2020.

The former Baling member of parliament named the director-general as the sole respondent and sought an order compelling the IRB to abide by the agreement.

According to court documents, the IRB investigated Azeez between mid-2018 and early 2022, resulting in a settlement under Section 96A(1) of the Income Tax Act 1967.

The agreement fixed his total tax and penalties for the 10-year period at RM4.8 million, payable in monthly instalments through 25 cheques.

Azeez maintained that he had paid the full amount.

However, in a letter dated Aug 7, the IRB informed him that the agreement and notice of composite assessment had been revoked following the discovery of new facts and income that had not previously been considered.

The board also informed him that a new tax calculation would be issued.

At the leave hearing on Oct 8, Azeez's counsel Nicholas Mark Pereira argued that the revocation could be challenged because Section 96A(6) of the Act provides that composite assessments are final and conclusive.

He submitted that Azeez had paid the agreed sum in full, but the agreement was revoked without a detailed explanation of the new facts allegedly discovered by the IRB.

Amer Hamzah also argued that the status quo should be maintained and questioned the legal basis for revoking the settlement after a composite assessment had been agreed upon.

Senior federal counsel Ng Siew Wee, representing the respondent, opposed the leave application on the grounds that it was premature.

She argued that the Aug 7 letter formed part of an ongoing investigation and did not create a new enforceable tax liability or assessment against Azeez.