SECRET INGREDIENTS SDN. BHD. (DAHULU DIKENALI SEBAGAI FORMULA CONTINENT SDN. BHD.) v Kerajaan Malaysia

Case Significance

Confirms that income-tax assessment notices sent by ordinary mail to a taxpayer's last declared address are deemed served under section 145(2) of the Income Tax Act 1967, the taxpayer bearing the burden of notifying any change of address under section 89.

This High Court decision at Johor Bahru concerns an appeal against summary judgment entered in favour of the Government in a tax-recovery action, and the deemed service of income-tax assessment notices. The appellant company, Secret Ingredients Sdn Bhd (formerly Formula Continent Sdn Bhd), appealed against the Sessions Court's decision granting the Government summary judgment under Order 14 of the Rules of Court 2012 for tax due. The core issue was whether the Notices of Assessment for the years of assessment 2017 and 2018 had been duly served on the appellant under section 145(2) of the Income Tax Act 1967. The court examined the evidence of service and found that the notices had been sent by ordinary mail to the appellant's last known address as declared in its Form C, and that under section 145(2)(a)(ii) of the Act such notices are deemed to be served. It held against the appellant's complaint that it had not received the notices, noting that the appellant had failed to notify any change of address as required under section 89 of the Act, and that its own conduct in filing a Form Q to appeal against the assessment notices for 2019 and 2020 showed it was being selective in how it addressed the tax claim. The court also held that the use of a Johor address for the writ of summons, derived from a company-registry search, was a separate matter governed by the Rules of Court and did not displace the statutory regime for service of tax notices under the Income Tax Act 1967. Finding the Sessions Court correct in holding the notices duly served, the court dismissed the appeal with costs of RM8,000. The judgment is a useful statement that income-tax assessment notices sent to the taxpayer's last declared address are deemed served, and the taxpayer bears the burden of notifying any change of address.