The National Feedlot Corporation (NFC) was not able to implement its cattle farm project as the government failed to provide the necessary infrastructure for it to take off, the High Court was told.
NFC chairman Salleh Ismail said Putrajaya had promised to make available a high-quality export abattoir in Gemas, Negeri Sembilan so that the project could launch.
“This resulted in the NFC being unable to generate income from the project to repay a government loan,” Salleh said in his witness statement.
He said a RM253.6 million loan disbursed to NFC in 2008 was tied with the project’s implementation and certain lease agreements which the company had entered into.
“Though the loan was disbursed, the government did not discharge its obligations and finally the project was suspended in 2010,” said Salleh, the second witness for the defendants.
In its defence, NFC also stated that all property which the company invested in or purchased from the proceeds of the loan sum had also been seized.
NFC together with Salleh, who is also the husband of former Wanita Umno chief Shahrizat Abdul Jalil, their three children and six companies owned by the family were named as the defendants in the suit filed in June 2019.
The government is seeking the recovery of the loan sum of RM253.62 million together with interest at 2% per annum and default interest on RM224.77 million.
Putrajaya is also seeking a declaration to hold Salleh’s family personally liable for the debt repayment of RM118.04 million allegedly misappropriated from the loan.
It said it is also entitled to claim equitable title in the properties bought using NFC’s RM250 million loan from the government.
In 2007, the government approved a RM250 million loan to NFC to turn the local cattle industry into a large-scale business with the aim of helping Malaysia become self-sufficient in beef production.
Under the loan agreement, NFC is supposed to repay RM17 million annually from 2012 to 2028.
Cross-examined by senior federal counsel Nurhafizza Azizan, Salleh said NFC could not pay the first instalment in 2012 as its bank accounts were frozen.
Seven witnesses gave evidence for the government which is taking the position that the loan was a standalone agreement and that the NFC had misappropriated the money.
Hearing before Justice Anand Ponnudurai was adjourned to tomorrow as Salleh was unwell. – FMT