Selangor Menteri Besar Azmin Ali and former Umno member Muhammad Zahid Md Arip's applications to have the court declassify the auditor-general's report on 1MDB will now be heard on their merits.

The report is presently classified under the Official Secrets Act (OSA).

Granting leave to Azmin and Zahid, who made separate applications, the Kuala Lumpur High Court this morning dismissed the preliminary objection brought by the Attorney-General's Chambers, which represented Prime Minister Najib Abdul Razak and the government.

Justice Hanipah Farikullah made the decision in chambers. Both applications would now be heard on their full merits.

Azmin was represented by senior lawyer Tommy Thomas while Mohd Haniff Khatri Abdulla appeared for Zahid.

Haniff told reporters that a case management date has been fixed on Feb 15, possibly to fix hearing dates.

“Leave has been allowed after the court dismissed the preliminary objection. Now the court will hear the substantive matters of the case."

Senior federal counsel Suzana Atan and Shamsul Bolhassan argued that the plaintiffs do not have legal standing and that the applications were frivolous and vexatious.

Judicial review applications require leave (permission) to be granted first, to ensure the application is not frivolous or vexatious.

First time Audit Report under OSA

Thomas in his submissions told the court that the classification of the 1MDB audit report under Section 2B of the Official Secrets Acts (OSA) is unprecedented.

“This appears to be the first time that an Auditor-General's report has been classified under the OSA. Members of the Public Accounts Committee, (directed to oversee investigations) were subjected to certain restrictions in reviewing the report and were prohibited from taking the report out of the Parliament,” he said.

“The unprecedented nature of the classification has also raised suspicions among the public. The Auditor-General's reports are normally presented and tabled every year in parliament to be debated by lawmakers, after which time they become public documents. They have never been classified as an official secret,” Thomas added.

The senior lawyer also submitted on 1MDB, which was incorporated in Feb 2009 under the Companies Act 1965, and is in the business of investment holding and strategic development.

“The entire paid-up capital of 1MDB of just RM1 million is owned by the Ministry of Finance Inc, and therefore monies belonging to the taxpayers. 1MDB is a state-linked investment company which comes under the control of Najib as Finance Minister, who was then chairperson of the 1MDB board of advisors - the highest ranking position in the company,” he said.

He said sometime on March 4, 2015, the Cabinet directed the National Audit Department to conduct an audit on 1MDB's financial position to verify its accounts and findings to be submitted to the PAC in the form of a federal audit report and it started its audit on March 10, the same year. An interim report was made on June 15, 2015, and PAC was briefed sometime on July 9 and 10, 2015.

It completed the report on Jan 31 last year, which was then handed to the PAC on March 4 last year - deemed classified.


Court provides checks on executive and administrative decisions

Thomas said the courts should consider granting leave as it must be allowed to check any executive or administrative decisions.

He said that auditor-general Ambrin Buang had promised that the 1MDB audit report would be tabled as a public document.

“The PAC report was distributed to MPs on April 7 last year and in the seating, Subang MP R Sivarasa requested the audit report be tabled together with the PAC report since the auditor-general would declassify the report once the PAC report was tabled in Parliament.

“Ambrin told reporters that the report remains classified and he did not respond to questions when it would be declassified, and this was inconsistent with the position that he had taken before,” he said.

Thomas said Azmin is an aggrieved party because as the Gombak MP, he is duty bound to review and debate the report once it is tabled.

"In order to effectively discharge his duties, Azmin must be able to read the whole report. He cannot do that because the report has been classified under the OSA. It is, therefore, imperative for the audit report to be declassified so that MPs are given an opportunity to debate the findings of the report,” he said.


Public interests necessitates report to be declassified

The report, Thomas, said does not only have the findings on the financial obligations of 1MDB but its debt obligations, which involve public funds.

“Public interest necessitates the report be declassified,” he said.

Azmin, who is also PKR deputy president, filed the judicial review application, naming Najib, Ambrin and the government as the first, second and third respondents.

The application seeks a declaration that classifying the report under OSA is unlawful and ultra vires (beyond the powers) of the Federal Constitution.

He is also seeking a mandamus to compel the three respondents, their agents, and officers to declassify the 1MDB report pursuant to Section 2C of the OSA, and for it to be released to the public.

Zahid, who is now the Supreme Council member of Parti Pribumi Bersatu Malaysia, was the first who filed the application when he was in Umno.