Fung shui master claims Wang gave him nearly HK$2b as gifts

Fung shui master Tony Chan, in deep hot water with Inland Revenue Department after his failed bid to claim the HK$100 billion Chinachem legacy left by the late Nina Wang, is seeking a judicial review of his staggering HK$340 million tax bill.

The demand by the Inland Revenue Department for HK$347,413,481, including HK$17.17 million in late fees, stems from disclosures by Chan during the probate trial over the Nina Wang estate.

Chan claimed he had received gifts from the late chair of the Chinachem empire in the amounts of HK$688 million and HK$1.37 billion.

Chan's lawyers contended the city's tax collectors did not take into account Chan's evidence in the 2010 probate trial that the two payments were gifts from Wang and not income related to provisions of personal services.

Chan's petition added that Justice Johnson Lam did not find the two payments represented business income in his judgment.

Chan is also seeking to have the courts overturn a decision by the department's commissioner denying Chan a chance to dispute the assessment because a one-month appeal period had passed since the tax collectors had sent the demand notice.

Appearing on behalf of Chan, senior counsel Philips Dykes told Justice Anselmo Francisco Trinidad Reyes that Chan never received the tax assessment and learned about it only after hearing in an April 24, 2010 news report, that the department was instigating court proceedings to recover outstanding salaries and property taxes.

Dykes said the department had sent demand notes to two addresses supplied by Chan, but an "informal system" of mail forwarding that had been set up to redirect mail to Chan had failed, leaving the demand notes unaccounted for.

Dykes said the department's officials chose to send their tax assessment and demand notes via an obviously stale route, despite their knowledge that there were, available to them, at least eight other avenues which were more likely to result in Chan's actual receipt of the demands.

Government counsel Stewart Wong Kai-ming argued that if Chan's defense that he didn't receive notice of assessment were to be accepted, it would give any taxpayer carte blanche.

Wong added it would leave the city's tax system open to abuse and lead to its eventual failure.

Justice Reyes reserved judgment.

Chan had appealed to Chief Executive Donald Tsang seeking "fair" legal treatment after petitioning the secretary for justice and police commissioner to drop all actions against him.

Chan has been on police bail for 476 days since Lam ruled a will Chan produced naming him the primary beneficiary of Nina Wang's estate was a forgery. He has made direct appeal of the case to the city's highest court.

China Daily

(HK Edition 05/26/2011 page1)