SHAH ALAM: The taxman winding up NGPC builder. The Inland Revenue Board (IRB) is winding up Destini Shipbuilding and Engineering Sdn Bhd (“DSBE”), the builder of MMEA’s Bagan Datuk class patrol boats. Destini Bhd – the parent company of DSBE – made public the IRB’s winding up petition in an announcement to Bursa Malaysia on September 6. The release from Destini Bhd:
Date 6 September 2022
Subject MATERIAL LITIGATION
Description DESTINI BERHAD (“DESTINI” OR “THE COMPANY”)
WINDING-UP PETITION DATED 15 AUGUST 2022 (IN THE HIGH COURT OF
MALAYA AT SHAH ALAM, IN THE STATE OF SELANGOR DARUL EHSAN,
MALAYSIA WINDING UP PETITION NO. BA-28NCC-454-08/2022) SERVED BY
GOVERNMENT OF MALAYSIA (“PETITIONER”) AGAINST DESTINI
SHIPBUILDING AND ENGINEERING SDN. BHD. (“RESPONDENT”), AN
INDIRECT SUBSIDIARY OF DESTINI
Destini wishes to announce that its indirect subsidiary, Destini Shipbuilding and Engineering Sdn Bhd (“DSBE”) had been served with a Winding Up Petition ensued from a Summary Judgment, details of which are as follows:
1) Date of service of the Writ of Summons and Statement of Claim
LHDN had filed a writ of summons and statement of claim on 18th September 2020 against DSBE (Suit No. BA21NCVC-65-09/2020 : Outstanding Tax YA2016 amounting RM6,584,440.74 excluding interest and penalty (“Suit 65”).
On 2nd November 2020, Messrs Zairul Zain Syed (the Company’s solicitors) (“ZZS”) filed a memorandum of appearance for and on behalf of DSBE.
On 16th November 2020, ZZS filed a defence Suit 65. Thereafter, LHDN filed a Summary Judgment Application for Suit 65 on 22nd December 2020. Summary Judgment for Suit 65 came up for hearing on 15th June 2021,
wherein, the High Court granted the Summary Judgment application.
2) Details of the default or circumstances leading to the filing of the Winding Up Petition and the particulars of the claim under the Winding Up Petition, including the amount claimed for and the interest rate
During the legal suit, DSBE made some payment and unable to fulfil the settlement payment proposal. Therefore, LHDN served a statutory notice under Section 466 of Companies Act 2016 to DSBE on 15th March 2022, claiming for RM6,241,959.61, inclusive interest and cost awarded by the Court.
DSBE filed a Fortuna Injunction Application on 28th March 2022. The High Court dismissed the application on 15th June 2022. The Hearing date of the Winding Up Petition is fixed on 8th November 2022.
3) Confirmation as whether DSBE is a major subsidiary DSBE is not major subsidiary of the Company.
4) Cost of Investment in DSBE The Company’s investment in shipbuilding activities (“DSBE”) is made through its wholly owned subsidiary, Destini Armada Sdn Bhd. (“DASB”). The total cost of investment of the Company in DASB is RM3,000,000.00.
5) The financial and operational impact of the Judgment on the Group
There is no impact on the financial and operation of Destini Group. This is in view that the Judgement sum of RM6,584,440.74 has been incorporated as tax liability in the financial statements.
6) The expected loss, if any, arising from the Winding Up Petition
The Company is not expected to incur any further loss arising from the Winding Up Petition.
7) Steps taken in respect of the Winding Up Petition
The Company is in negotiation with LHDN and will submit a payment settlement proposal to LHDN.
This announcement is dated 6 September 2022.
If you like this post, buy me an espresso. Paypal Payment
It must be noted that while DSBE is the builder of the Bagan Datuk patrol vessel previously known as the New Generation Patrol Craft (NGPC), the boats were built at the Destination Marine Services Sdn Bhd shipyard in Port Klang. Based on the statement by Destini, it is likely that the winding up petition which will be made final this November 8, will not have any effect on the company’s activities.
It is interesting to note that DSBE was the Destini’s point company for its JV for the building for the MMEA OPV with TH Heavy Engineering. They parted company last year.
The news of the winding up petition came hard on the hills of report that Destini was in the same financial pickle as TH Heavy. It is not of course.
Anyhow, I was told that the first MMEA OPV, PCU Tun Fatimah is expected to be launched on September 13. Hopefully, this time it will not be delayed. If you read reports that the OPV is delayed by three years or so, its not. Infact if the Tun Fatimah is launched on September 13, she will only be delayed by one month. Unfortunately, I have been told that the September 13 launch has been scrubbed.
*Updated on September 9 to say the September 13 launch has been scrubbed.