Legal counsel argues RM250 million to NFCorp chairman was a loan, not a grant, rendering it a civil, not criminal matter.
KUALA LUMPUR: The Kuala Lumpur High Court today heard an application to strike out two CBT charges against National Feedlot Corporation chairman Mohamad Salleh Ismail for RM9.1 million and RM40 million.
The court was told that National Feedlot Corporation (NFCorp) had taken a loan of RM250 million and the sum was not a grant. Thus, the matter would be of a civil nature and not criminal, emphasised Muhammad Shafee Abdullah, legal counsel acting for NFCorp chairman Mohamad Salleh Ismail.
“This money has legally passed to NFCorp and is no longer the government’s money. NFCorp has an obligation to repay the loan subsequently. Therefore, NFCorp is not the trustee for the fund for the government,” said Shafee.
Judge Mohd Azman bin Husin presided today.
The court was told that at an NFCorp Board Meeting held on December 22, 2010, the auditor had during the tabling of the audited FY2009 Financial Report, informed the board of the advance of RM81,324,745 from NFCorp to National Meat & Livestock Corporation Sdn Bhd (NMLC), a related company in the NFCorp group.
The amount was inclusive of the RM40 million and RM9,758,140 stated in the CBT charges.
NFCorp’s audit report, approved by the board, was circulated to all members of the board including representatives from the Ministry of Finance, Ministry of Agriculture and Agro-Based Industry, and the Menteri Besar Inc of Negeri Sembilan, for their information.
This matter was also recorded in the NFCorp board meeting of September 21, 2011 in which the board had approved and agreed that “NFCorp to ratify the advances made to NMLC with no interest to be charged.”
“No objections were received from the government representatives nor from the shareholders, all of whom were members of the board of NFCorp,” said Shafee.
The court was told that whilst the defendant had dominion over the funds as a director of the company he had not misappropriated the funds, what more dishonestly.
As such, Shafee said the charges read together with Section 409 in consonant with 405 would demonstrate that there were no elements of CBT.
In addition, Section 173G would allow for the accused to strike out the CBT charges , he added.
“The points raised today show that there had never been any intention on the part of the defendant for any wrong doing in respect to the charges laid.”
The court was told that the relationship between NFCorp and NMLC had been clearly understood and known to the Government, its agencies and its board representatives; the advances from NFCorp to NMLC had been known to the government board representatives and shareholders, all of which were recorded in the annual audited accounts; the rationale for the transfers were genuine for the success of the project; and the advances had certainly been approved, agreed and ratified accordingly.
Shafee said, “Although there is no CBT elements to begin with, NFCorp in abundance of caution did the two ratifications at separate levels of the company over the sums involved.”
The court reserved its decision and set February 26, 2015 for delivery of the verdict.