REVENUE LAW

KETUA PENGARAH HASIL DALAM NEGERI v. KIND ACTION (M) SDN BHD [2025] 4 CLJ 501 (Federal Court)

Case Digest :

[1] The Inland Revenue Board (IRB), under the Real Property Gains Tax Act 1976 (“RPGT Act”), ought to consider the contents of the taxpayer’s returns in order to decide whether to accept it or make adjustments, and thereafter, raise the assessment. Once the assessment is raised and assessed with the issuance of the certificate of clearance, in the absence of any appeal against the same, the IRB’s decision is final and conclusive.

[2] Nowhere in the RPGT Act is it provided that the IRB could take the returns “on the surface’' and “keep open the various alternatives” as that would result in a perpetual uncertainty in tax position, which could not be the intention of Parliament. The law clearly prohibits the IRB from double taxation, hence, where a taxpayer has been taxed under the RPGT Act, the same party could not be subjected to tax under the Income Tax Act 1967 on the same transaction. Where such notice of assessment is issued, it would amount to a gross violation of the principle of double taxation and gives rise to illegality. There is no possibility of an overlap between tax payable under the Income Tax Act 1967 and RPGT Act.

HAVI LOGISTICS (M) SDN BHD v. PEMUNGUT DUTI SETEM [2025] 3 CLJ 463 (Federal Court)

Case Digest :

[1] An agreement for the sale of a business, encompassing fixed assets, liabilities, and business contracts, constitutes a “conveyance on sale” under s. 21(1) of the Stamp Act 1949 , and is subject to ad valorem stamp duty under item 32(a) of the First Schedule to the said Act, even if the actual transfer of title occurs at a future date. In ascertaining whether the agreement was a conveyance on sale, the court must first determine whether the intention of the parties to the agreement is to ultimately pass title to the assets to the appellant via the instrument.

[2] There is no requirement under s. 21(1) of the Stamp Act 1949 that an instrument must operate to convey or transfer property for it to be a conveyance on sale. The fact that the sale transaction is not concluded on the date of the instrument or that it was to be completed at a future date is immaterial. The timing of the closing or when the title to the property passes cannot be the determinant factor in construing whether an instrument is a conveyance on sale. Otherwise, ad valorem stamp duty can easily be avoided by merely stating in the instrument that the title to the property sold shall pass at a future date.

CIMB BANK BHD v. PEMUNGUT DUTI SETEM [2025] 3 CLJ 807 (Court of Appeal)

Case Digest :

[1] Section 4(3) of the Stamp Act 1949 generally provides that only the principal instrument documenting a transaction is chargeable with duty. It does not, however, apply when: (a) the instrument does not fall within the categories of “sale, lease, charge, settlement, exchange of partition” as specified in the said section; and (b) the instrument itself creates new payment obligations, even if it is related to pre-existing obligations.

[2] The proper categorisation of a document for stamp duty purposes is a question of law and ultimately one for the courts to determine. The recording of any understanding between a taxpayer and a taxing authority cannot have the effect of supplanting the operation of written law, except where the law so permits. Estoppel does not lie against the Collector of Stamp Duties to prevent him from performing his statutory duty to assess and impose stamp duty on dutiable instruments.

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