Court rejects Najib, son's bid to postpone bankruptcy proceeding

The Kuala Lumpur High Court has dismissed former prime minister Najib Abdul Razak and his son Nazifuddin’s appeal to postpone a bankruptcy proceeding.

The ruling paved the way for the Inland Revenue Board (IRB) to proceed with bankruptcy action against the father-son duo, unless they pay their RM1.69 billion and RM37.6 billion in unpaid taxes and penalties.

Judicial commissioner Suhendran Sockanathan @ Saheran Abdullah rejected their appeal this morning against the High Court’s deputy registrar’s decision that refused them a stay of bankruptcy notice in August last year.

“No payments have been made, a writ of summons has been issued, and summary judgment was ordered against (Najib and Nazifuddin). The appeal to the Court of Appeal and the Federal Court is dismissed.

“So there are no avenues left in relation to the judgment. The bankruptcy notice was filed for RM1.7 billion (of arrears), which was served on April 5, 2021,” he said, which resulted in the application before him.

Suhendran said there was no sufficient ground to grant their application as the court’s role is only to facilitate tax collection and recovery, and that their arguments for a postponement hold merit for the Special Commissioner of Income Tax (SCIT)’s perusal.

These include their claims that the arrears were incorrectly calculated, nor that political donations were not taxable income.

He also said that their pending appeal to SCIT does not hamper their obligation to pay the arrears.

Suhendran added that IRB are entitled to proceed as the duo had been served with a bankruptcy notice in April 2021, despite no bankruptcy petition filed as of the present time.

“I do not see any other damage that would warrant a stay,” he said, in awarding RM7,500 for each appeal to the IRB.

Najib and Nazifuddin’s lawyer, Wee Yeong Kang, confirmed to the media after today’s proceedings that he has been instructed to file an appeal against the judicial commissioner's decision.

Govt’s suit

In June 2019, the government, through IRB, filed a suit against Najib, where it sought over RM1.69 billion from the former premier, with an annual five percent interest rate beginning from the date of judgment, as well as costs and other relief deemed fit by the court.

In its statement of claim, the government said Najib had failed to pay his income taxes for 2011 to 2017 within the stipulated 30-day period after assessment notices were issued.

IRB, on July 22, 2022, had succeeded in getting a summary judgment from the High Court to recover the RM1.69 billion from Najib.

The Federal Court had dismissed Najib and Nazifuddin’s appeal to set aside the summary judgment on Oct 16, 2023, which meant that they had to settle the RM1.69 billion and RM37.6 billion of unpaid taxes and penalties.

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