PKFZ bond fallout averted

KDSB and would make the payments to the bondholders upon revocation of the letter.

Concurrently, deputy transport minister Datuk Abdul Rahim Bakri reportedly reiterated the government’s “commitment” to honour all debt obligations issued by KDSB.

In a media statement yesterday, IRB said it had withdrawn the letter of appointment of PKA as agent for KDSB.

“We have received the letter of objection from PKA pertaining to the appointment of agent under Section 68 of the Income Tax Act 1967 together with the letter of appeal from KDSB who is aggrieved with the assessments raised by the IRB.

“In light of the recent communication by KDSB disputing the assessments, we have withdrawn the appointment of PKA under Section 68 of the same Act and we will deal directly with KDSB on the payment of tax,” IRB’s public relations officer Masrun Maslim said in the statement.

According to documents obtained earlier by The Edge Financial Daily, OSK Trustees had written to PKA and the IRB seeking that the payments to bondholders be released as they were due to the bondholders and not KDSB.

It had said the money was due to holders of papers issued by two special purpose vehicles, Transshipment Megahub Bhd (TMB) and Valid Ventures Sdn Bhd (VVB). Citing a legal opinion, OSK Trustees had said any payment PKA were to make to the IRB would constitute an event of default.

The Edge Financial Daily also reported yesterday that KDSB was disputing the amount of backdated taxes owing to the IRB. Claiming that KDSB appeared to have been “victimised”, its CEO Datuk Faisal Abdullah described the amount of RM328 million allegedly owing to IRB as “absurb”.

Faisal said the accounts in dispute went as far back as 1997 and 1998, and that the company had repeatedly sent letters to the IRB to dispute the amount.


This article appeared in The Edge Financial Daily, July 1, 2010.