KUALA LUMPUR (Sept 19): EcoFirst Consolidated Bhd said it has been sued by the Inland Revenue Board (IRB), on behalf of the government, over some RM35.47 million in additional tax and penalty the latter is claiming for.
In a statement to Bursa Malaysia today, EcoFirst said IRB had raised additional income tax assessment amounting to RM30.71 million to its wholly owned unit Pujian Development Sdn Bhd (PDSB) for the assessment year 2004.
PDSB disagreed on the basis of the assessment and appealed to the IRB, who forwarded the appeal form to the Special Commissioners of Income Tax (SCIT), which then instructed both parties to attend a hearing on July 23 and 24, 2019.
"PDSB has not paid the additional assessment pending the outcome from the SCIT and hence a tax penalty of 10% amounting to RM3.07 million was imposed on the outstanding additional assessment," EcoFirst said.
It said the additional assessment and tax penalty remained outstanding after 60 days from the payment deadline. As such, it said a tax penalty of 5% amounting to RM1.69 million was imposed.
Hence, in IRB's writ of summon and statement of claim against PDSB, IRB is claiming for RM35.47 million, an interest of 5% per annum on the sum from the date of judgment until the date of realisation, costs, and whatever other reliefs the court deems fit.
"Upon consulting its solicitors, PDSB is of the view that there are reasonable grounds to challenge the claims. In this regard, at this juncture, the company is not able to ascertain the financial impact arising from the claims.
"The claims, however, are not expected to have any material operational impact on the EcoFirst Group," said EcoFirst.
It added that the court has fixed the suit for case management on Oct 5, 2017 and that the company is currently seeking the advice of its solicitors to handle the matter. "Any further material development of the above matter will be announced in due course."
At 16.02pm, shares in EcoFirst were down one sen or 3.39% to 28.5 sen for a market capitalisation of RM228.9 million. — theedgemarkets.com