KUALA LUMPUR (Oct 19): The High Court in Shah Alam today granted leave for Mercedes-Benz Malaysia Sdn Bhd to initiate a judicial review against the Royal Malaysian Customs Department over the imposition of additional duties totalling RM8.7 million for 2017. 

It is understood that Justice Datuk Seri Tun Abdul Majid Tun Hamzah granted leave to the company, based on exceptional circumstances of the case, for full merits of the matter to be heard. 

The court also granted an interim stay of the order to pay the disputed duties.

Mercedes-Benz was issued two bills of demand by the Customs Department in July for the audit period of January to December 2017, pursuant to the Customs Act 1967 and the Goods and Services Tax Act 2014.

The dispute arose when the department suddenly disallowed the company’s claim for import duty exemption in respect of the Mercedes-Benz E350e model. 

Mercedes-Benz was represented by tax lawyers S Saravana Kumar and Amira Rafie from Messrs Rosli Dahlan Saravana Partnership. 

The Customs Department, meanwhile, was represented by federal counsel Istisyhad Ismail from the Attorney-General’s Chambers (AGC). 

In seeking the judicial review, Mercedes-Benz submitted that the company had been granted full import duty exemption by the then finance minister for the Mercedes-Benz W213 series — for being completely knocked-down (CKD) units — and had complied with all the conditions stipulated by him.

The W213 series is the fifth generation of the Mercedes-Benz E-Class range of executive cars.

Saravana argued that the Customs Department was bound by tax exemption granted by the finance minister and not empowered to withdraw or disallow the tax exemption granted to the company.