Govt pays additional RM65 million to Dhaya Maju LTAT for work done on KVDT2

KUALA LUMPUR (March 2): The Malaysian government yesterday paid close to RM65 million as payment for work done by Dhaya Maju LTAT Sdn Bhd (DM-LTAT) for the Klang Valley Double Tracking Phase 2 (KVDT2) project in a bid to avoid judgement to be entered on it following the company's sudden termination.

The payment of RM65 million is in addition to the RM137.5 million that the government paid last December. In total, the government has paid RM202.5 million for the work done on the rail track.

The case came up before High Court Justice Datuk Aliza Sulaiman today, where the court was told of the payment made on interim payment certificates 7 and 8 portions of the project.

As a result of the payment, DM-LTAT withdrew its application to enter judgement on the Malaysian government. Another case management has been fixed for the case on April 9.

The government was represented by senior federal counsel Asliza Ali, while lawyer Tatvaruban Subramaniam from Skrine appeared for DM-LTAT.

Asliza is the head of the government contract and medical negligence unit at the Attorney-General's Chambers.

DM-LTAT had named the Malaysian government and present Transport Minister Datuk Seri Dr Wee Ka Siong as defendants in the suit following termination of the KVDT2 project last year, despite the project was said to have been 24% completed.

Wee in August said that the government would reopen the tender for the project after taking into consideration the results of an extensive study and investigation into the project's cost.

The transport minister said the open tender would be in the interest of optimising the use of public funds for large-scale infrastructure projects.

"This (Perikatan Nasional) government has closely scrutinised the viability of such projects to gain the best value for the country. For this reason, I wish to announce that the contract for the KVDT2 project will be reopened for tender, to which the Cabinet had agreed," Wee said.

Wee had been involved in a spat over this issue with his predecessor Anthony Loke on the matter.

Citing an affidavit by Datuk Mohamed Razeek Hussain Maricar, Loke claimed in the Dewan Rakyat on Nov 17 that Wee had asked the company to subcontract the project to a firm from China — instead of carrying it out themselves. Wee, however, denied the claim.

Mohamed Razeek is the chief executive officer of Dhaya Maju Infrastructure (Asia) Sdn Bhd, which owns 80% of DM-LTAT.

Minister in the Prime Minister's Department Datuk Takiyiddin Hassan in November last year said that it might seek an out of court settlement with regard to the suit.

The company filed the suit on Sept 7 to try to stop the termination but after failing to get an injunction on Sept 18, the firm was subsequently terminated.

As a result, DM-LTAT applied in November for judgement to be entered against the government and Wee for owing them the RM137.5 million and this led to the subsequent payment in December.

Sources familiar with the case said the government still owes the company interests for the delayed payment.

Tomorrow there will be another case management of DM-LTAT suit against the duo along with Keretapi Tanah Melayu Bhd and Opus Consultants Sdn Bhd, the consulting firm who made a study suggesting the KVDT2 project could be built for much less. The case is heard before Justice Datuk Lim Chong Fong.

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