The Supreme Court has ordered agribusiness giant Asian Agri Group to pay Rp 2.52 trillion (US$258.5 million) in fines and sentenced its former tax manager, Suwir Laut, to two years in prison in one of the most controversial tax evasion cases in the country.
The ruling was the Supreme Court’s first verdict in a tax evasion case.
“The fine must be paid within one year,” Supreme Court spokesman Ridwan Mansyur said during a press conference in Jakarta on Friday.
The fine is twice the amount of the tax obligation that Asian Agri Group had evaded, Rp 1.26 trillion.
Earlier on Thursday, Supreme Court judge Djoko Sarwoko confirmed the ruling, saying he read out the verdict at a court session on Dec. 18.
Djoko was the presiding judge on a panel consisting of fellow judges Sri Muharyuni and Komariah E. Sapardjaja, Antara news agency reported.
Djoko said that Suwir Laut was proven guilty of violating Article 39 of the law on tax evasion.
At a trial in 2011, prosecutors charged Suwir for submitting the firm’s false tax reports between 2002 and 2005, which allegedly caused Rp 1.25 trillion (US$137 million) in state losses.
However, the Central Jakarta District Court and the High Court acquitted him of all charges, arguing that prosecutors failed to prove that Suwir had manipulated Asian Agri’s tax documents.
The prosecutors later appealed to the Supreme Court, which eventually found Suwir Laut, or Liu Che Sui as he is also known, guilty of continuously producing fake documents.
“The panel of judges sentenced the defendant to two years in jail,” Ridwan said, adding that the verdict was a breakthrough in the country’s legal system.
“This verdict is interesting. Although tax evasion is seen as an administrative affair, the panel of judges consider it a tax crime,” he added.
With its verdict, the panel of judges found that the falsification of information/data was contradictory to the taxation’s self assessment system.
“The defendant provided false data on the tax obligation of 14 companies [under Asian Agri Group] for four consecutive years to lower tax obligations,” Ridwan added.
The 14 companies are Mitra Unggul Pusaka, Tunggal Yunus Estate, Dasa Anugerah Sejati, Andalas Intiargo Lestari, Hari Sawit Jaya, Rantau Sinar Karsa, Rigunas Agri Utama, Gunung Melayu, Inti Indosawit Subur, Raja Garuda Mas Sejati, Indo Sepadan Jaya, Nusa Pusaka Kencana, Supra Matra Abadi and Saudara Sejati Luhur.
Contacted separately, Asian Agri Group sustainability head Freddy Widjaya said that the company had not received the official copy of the verdict from the court.
“We have not determined what our next step will be. Submitting a PK [case review] may be an option, but we have to discuss it first,” Freddy said.
Meanwhile, a member of Suwir Laut’s team of lawyers, Mohammad Assegaf, criticized the Supreme Court’s panel of judges for acting too hastily in the case.
“This trial proceeded too fast. I am suspicious that Djoko Sarwoko is just trying to build a good image as he will retire soon,” he said, referring to the presiding judge.
As previously reported, Djoko is scheduled to retire on Jan. 1, 2013. The dossiers of the Asian Agri case were only submitted to the Supreme Court on Nov. 22.
Assegaf said that the judges had ignored the fact that Asian Agri had sent multiple letters to the tax office four years ago, asking the office to issue a tax ordinance, officially stating the amount of tax that the company had to pay.
The company sent copies of the letters to the Finance Minister as well, but it received no response, he added.
Asian Agri could have responded by accepting or rejecting the amount of tax stated in the ordinance had the tax office issued it, according to Assegaf.