Petronas obtains leave to commence case against IRB over RM3.6b tax

 

Petroliam Nasional Berhad (Petronas) and three other companies obtained leave to commence judicial review proceedings in the High Court in Kuala Lumpur to challenge the action of the Inland Revenue Board (IRB) in imposing additional tax assessments totalling RM3.6 billion between 2010 and 2017.

Lawyer S Saravana Kumar informed the court that IRB did not object to the application and agreed that leave is given to the company to initiate a judicial review application through a draft consent order provided by the company.

"The draft consent order is prepared by us and to save court time, all parties have reached a solution with the respondent (IRB) in agreeing to give permission to the applicant to proceed with the case," said the lawyer.

Judge Ahmad Kamal Md Shahid later recorded the consent order, but the court has not set the date of the judicial review hearing.

In today's proceedings, Saravana represented all applicants, namely Petronas and its subsidiary Petronas Carigali Sdn Bhd together with Sapura OMV Upstream (PM) Inc, and Tembungo Sub Block PSC while deputy solicitor Hazlina Hussain represented the director-general of IRB as the respondent.

On July this year, Petronas and its subsidiary Petronas Carigali with Sapura OMV and Tembungo Sub Block PSC filed three judicial review applications against the IRB alleging that IRB’s action was “ultra vires, illegal, void, in excess of authority and irrational in making the additional tax assessments totalling RM3.6 billion”.

Petronas alleged that the IRB had breached Section 15(1) of the Petroleum (Income Tax) Act 1967 (PITA).

The national oil firm also alleged that IRB had misconstrued Section 72(1)(a) of PITA, which tantamounts to accusing Petronas of tax avoidance.

- Bernama