KUALA LUMPUR, May 10 ― PAS demanded today that a Royal Commission of Inquiry (RCI) be formed to investigate Lembaga Tabung Haji's (LTH) recent land deal with 1 Malaysia Development Berhad (1MDB), and that the matter will be raised when Parliament reconvenes on May 18.

PAS Temerloh MP Nasruddin Hassan said there have been grave concerns that the Muslim pilgrims' fund was being used as “bailout” for troubled investment firm 1MDB.

“An independent probe is needed, an RCI should be formed to investigate the matter,” he told reporters at a news conference after officiating a Federal Territories PAS event here.

“The purchase of the land, this is not the issue. The issue is how this is being seen as bailout for 1MDB,” Nasruddin stressed.

He said an RCI would be the Islamist party's top priority and that this would be deliberated in the coming Parliament sitting.

“Our chief whip Datuk Mahfuz Omar will definitely raise this issue in Parliament,” the PAS central committee member said.

Prime Minister Datuk Seri Najib Razak said today that LTH funds for Muslim pilgrims was not being used as bailout for 1MDB.

According to Bernama, Najib, who was speaking publicly on the issue for the first time, pointed out that LTH’s latest plan to turn over the land it bought from 1MDB to the private sector was a sound commercial decision as it would see the fund earn a few million ringgit overnight.

“So, it cannot be a bailout (for 1MDB). No private company will buy over a project if it is going to lose money,” he was quoted by the national news agency as saying in Kota Belud, Sabah.

The news agency also quoted the prime minister saying that the government does not want the controversy prolonged and that the issue has been manipulated to fuel speculation that LTH was using depositors’ money to save debt-laden 1MDB.

Najib has been criticised for his alleged haste in advising LTH to sell the land in question - a 1.56-acre plot in the Tun Razak Exchange (TRX) purchased last month from 1MDB.

LTH reportedly paid RM188.5 million at RM2,773 psf for the land, which is 43 times what 1MDB paid four years ago when it purchased the plot for just RM4.5 million at a rate of RM64 psf.

A blog called “The Benchmark” first raised speculation on the purchase when it published purported documents of the controversial transaction that critics now claim could be a bailout for 1MDB.

According to LTH chairman Datuk Seri Abdul Azeez Abdul Rahim yesterday, the move to sell the land was a complete U-turn from the fund’s board of directors’ decision on Friday not to do so.

He also claimed that the fund already has three potential buyers for the plot and that the sale will net LTH at least RM5 million in profit.

Responding to the announcement, several lawmakers said today that 1MDB should instead cancel the transaction entirely and refund the RM188.5 million paid by LTH.