An ex-senior transport ministry official in the corruption trial of former transport miniser Dr Ling Liong Sik admitted to having made a mistake in the cost for per square foot (psf) of the Port Klang Free Zone (PKFZ) land.

A mere ‘confusion’ resulted in the special value of RM21psf to be jacked up to RM25, in a letter written to land owner Kuala Dimensi Sdn Bhd (KDSB) on Oct 2, 2000 by principal assistant secretary in the ministry’s maritime division P Chandrasekaran.

ong tee keat pkfz klang visit 060508 12 “The deputy secretary-general (earlier witness Abdul Rahman Mohd Noor) told me that we have received JJPH (Valuation and Property Service Department) and asked me to send a letter to KDSB, asking for their agreement on the valuation of JPPH,” Chandrasekaran narrated in reply to questions by DPP Manoj Kurup.

Chandrasekaran said that he did not know how to write the letter, so he wrote it as it was dictated to him by Abdul Rahman.

Chandrasekaran, 56, who is now the undersecretary in the aviation division, had then typed out the letter, using the table provided in JJPH’s letter and stating that RM25 psf was special value, as it included the construction of basic infrastructure development and other terms and conditions.

In the JPPH letter dated Sept 29, the valuer assumed that 830 acres of land would be paid for over a period of 10 years at six percent interest per annum after putting down a five percent deposit.

When Manoj pointed out that the JPPH did not state in their letter that RM25 psf was at special value, Chandrasekaran concurred.

Manoj: But it is mentioned as special value in your letter?

Chandrasekaran: Yes.

Manoj: So how is it that in P16 (JPPH’s letter) it is RM21 psf and P18 (Chandrasekaran’s letter) it is RM25?

azlan Chandrasekaran: It is my understanding that for cash payment, the special value is RM21... but for deferred payments the special value is RM25.

The fifth witness in the hearing today said that he came to that opinion based on the summary provided in the JPPH letter.

Asked why was the JPPH detail summary on the RM25 psf special value “missing” in Chandrasekaran’s letter, he replied that it was and he wrote the letter as it was “dictated” to him.

Judge Ahmadi Asnawi then asked, “So your are blaming your boss?”

Chandrasekaran: No, no, no.

Ahmadi: But you said it was dictated?

Chandrasekaran: Yes.

He then accepted that he should not have stated that RM25 psf was “based” on a special value.

Judge raps witness for boo-boos

After the hearing resumed in the afternoon, Chandrasekaran was again put in the hot seat, over contradictions that arose from documents prepared by him back in 2000.

Referring to a memorandum that he had prepared for Abdul Rahman on Oct 14, Manoj asked Chandrasekaran to clarify paragraphs in which the latter had given conflicting facts.

“In paragraph 3, you stated that JPPH valued the land based on the special value of RM25 psf with 10 years of repayment period.

“The total cost for the 830 acres land is estimated at RM903.9 million not including the six percent.

“But then (in the following) paragraph 4 under the terms and condition of the land buy it stated that the coupon rate (interest rate) of six percent is included,” said Manoj.

The witness replied that it was his “understanding” that the RM25 psf value “did not include interest”.

Manoj: What was your understanding then? When you have stated here that the special value was based on the following (terms)?

Chandrasekaran: I’m not able to explain, but (in) my understanding (the interest rate) is separate.

Ahmadi: I don't think we can accept your understanding... if you're a schoolkid okay lah... you're a senior government servant.

This was not the only mistake. Chandrasekaran was also “scolded” by his superior, Abdul Rahman, for making another mistake in a letter written to Port Klang Authority (PKA) general manager OC Phang on Dec 23.

In the letter, Chandrasekaran informed Phang that the Finance Ministry in a previous meeting held on Nov 28 “had not made its decision on whether to proceed with land buy for the mega transhipment hub so it better not to inform JAFZI (Jebel Ali Free Zone International)”.

This letter was contradictory to a decision taken on Nov 28, in a meeting chaired by Abdul Rahman and in the presence of Chandrasekaran, the Transport Ministry agreed to buy the land and the Finance Ministry was finalising the transactions.

“I was not sure why the paragraph 3 (in the letter) was not accurate but he (Abdul Rahman) scolded me and said we were going to buy the land,” explained Chandrasekaran.

“But to me until we received the official letter from the Finance Ministry saying that they agree, there is no decision yet,” he said in his defence.

It was established that Abdul Rahman had later issued another letter to Phang instructing the port authority to ignore the excerpt in the Dec 23 letter.

Ling faces a charge of deceiving the government by concealing an additional interest rate of 7.5 percent per annum to the cabinet for the purchase of 999.5 acre plot for the mega transhipment hub.

He was said to have committed the offence at the Prime Minister's Office in Putrajaya between Sept 25 and Nov 6, 2002.

Ling is accused of having committed deception with the knowledge it could cause wrongful losses to the government and despite being bound by a fiduciary duty to protect the government.

Ling also faces two optional charges:

  • Cheating the government by not revealing to the cabinet the facts relating to the interest rate;
  • Cheating the cabinet into believing that the facts relating to the purchase of the land at the rate of RM25 psf and interest rate at 7.5 percent were approved and agreed to by the JPPH, an agency under the Finance Ministry, when he knew there was no such consent.
Earlier on, the prosecution established that PKA had bypassed procedures in inking the PKFZ land deal on Nov 12, 2009 even before the cabinet had given its official approval.