Our previous article explained how JPPH might be using two figures when comparing property values, and why using an internal opinion instead of actual transaction prices can inflate your stamp duty assessment. This case shows exactly how that played out in court.

𝐁𝐚𝐜𝐤𝐠𝐫𝐨𝐮𝐧𝐝 𝐨𝐟 𝐭𝐡𝐞 𝐜𝐚𝐬𝐞 Ku Ek Mei purchased two properties from Luxury Setup Sdn Bhd for RM1,000,000.00 and RM5,000,000.00 respectively. JPPH assessed the market value of the First Subject Lot at RM2,089,000.00 and the Second Subject Lot at RM13,970,000.00, both significantly higher than the purchase prices. The appellant objected and appealed. The central argument was whether JPPH was entitled to use (D), its own internal opinion of a comparable's value, instead of (B), the actual transaction price, to determine the market value of both properties.

𝐏𝐨𝐬𝐢𝐭𝐢𝐨𝐧 𝐨𝐟 𝐭𝐡𝐞 𝐓𝐚𝐱𝐩𝐚𝐲𝐞𝐫 Ku Ek Mei argued two errors. First, JPPH selected unsuitable comparable lots, particularly for the Second Subject Lot where the comparable used was geographically furthest, differently designated, and transacted more than three years prior. Second, JPPH used (D) instead of (B) for both properties, amounting to a valuation upon a valuation. Using the correct figures, the appellant submitted market values of RM1,100,000.00 and RM8,301,252.86 respectively.

𝐏𝐨𝐬𝐢𝐭𝐢𝐨𝐧 𝐨𝐟 𝐭𝐡𝐞 𝐒𝐭𝐚𝐦𝐩 𝐃𝐮𝐭𝐲 𝐂𝐨𝐥𝐥𝐞𝐜𝐭𝐨𝐫 The Collector maintained JPPH had applied the comparable method correctly. The actual price paid is not the sole determinant of market value as other factors including time, location, size, land type and planning must also be considered. A private valuer's report could only be preferred if the appellant could show JPPH had wrongly exercised its discretion or acted beyond its statutory powers.

𝐃𝐞𝐜𝐢𝐬𝐢𝐨𝐧 𝐨𝐟 𝐭𝐡𝐞 𝐂𝐨𝐮𝐫𝐭 The Court of Appeal unanimously allowed the appeal. For the First Subject Lot, JPPH's own valuer admitted she could not explain how the (D) figure of RM220.00 per square metre was derived. The Court found it was a figure plucked from the sky and ordered stamp duty to be assessed on RM1,100,000.00. For the Second Subject Lot, the Court found a more suitable comparable existed and that JPPH had again used (D) instead of (B). Using the correct figure, the market value was confirmed at RM8,301,252.86. All excess stamp duty paid was ordered to be refunded.