Tax arrears: Court strikes out Shafee’s appeal to file counterclaim

PUTRAJAYA: The Court of Appeal here Thursday struck out Tan Sri Muhammad Shafee Abdullah’s appeal against the High Court’s decision to disallowed him to file a counterclaim over the Inland Revenue Board’s (IRB) demand that he pays income tax arrears amounting to RM9.41 million.

A three-member bench led by Justice Datuk Hanipah Farikullah held that Muhammad Shafee’s appeal was incompetence as the subject matter was not appealable under Section 3 of the Courts of Judicature Act.

Justice Hanipah, who sat with Datuk Azimah Omar and Datuk Wong Kian Kheong also ordered the veteran counsel to pay costs RM10,000.

Muhammad Shafee was represented by Datuk Seri Rajan Navaratnam, Muhammad Farhan Muhammad Shafee and Wee Yeong Kang while IRB senior counsels Norhisham Ahmad, AlHummidallah Idrus, Norzilah N Hamod @ Abdul Hamid and Muhammad Faqrol Syazreen Mohd Ghause acted for the IRB.

Meanwhile, Rajan told reporters that his client is at liberty to file a fresh suit.

On April 13, last year, the High Court dismissed Muhammad Shafee’s application to obtain leave to file a counterclaim after finding that the counterclaim does not arise from the recovery of taxes but from mala fide acts by the Malaysian AntiCorruption Agency (MACC) and the Attorney- General’s Chambers (AGC), which does not fall within the set scope of the rule prohibiting counterclaim.

On Dec 21, last year, Muhammad Shafee was ordered by the High Court here today to pay over RM5.5 million in income tax arrears to the Inland Revenue Board (IRB) after allowed IRB’s application for a summary judgment against the lawyer.