BN secretary-general Tengku Adnan Tengku Mansor's testimony at the High Court today offered a rare glimpse into how the coalition finances its by-elections.

In his witness statement, Tengku Adnan said it was a "usual practice" for Umno to raise funds for by-election campaigns through "political donations".

For the Sungai Besar and Kuala Kangsar by-elections in 2016, Tengku Adnan said he approached Chai Kin Kong, the boss of property developer Aset Kayamas Sdn Bhd, who allegedly was a regular donor to Umno and BN since 1999.

"In general, political donations were made in cash because money was required to pay for campaign expenses and time was quite short.

"However, Chai informed me that it would be difficult to raise cash in a short period of time and he instead gave me a cheque on or around June 14, 2016," he said.

The cheque was made to Tadmansori Holdings Sdn Bhd, of which Tengku Adnan controls. Tengku Adnan said the money arrived late because the by-elections were held on June 18, 2016.

Tengku Adnan said he could not wait for Chai's cheque so he had advanced a total of RM2,020,800 from his own pocket for the by-election campaigns.

Of this amount, RM1,013,200 went to Bandar Tun Razak Umno division head Rizalman Mokhtar to be used by the Federal Territories BN campaign team for the Sungai Besar by-election campaign.

"This money was used for expenses including accommodation, travelling, daily allowances, food and drink, campaign materials and other incidental expenses for the Sungai Besar by-election," he said.

Another RM1,007,600 went to Simpang Renggam Umno division head Zakaria Dullah.

Tengku Adnan said Zakaria used the money for the BN Youth Volunteer Project, which involved some 1,000 youths participating in the by-election campaign.

"(The) BN Youth Volunteer Project assisted in election operations by organising tuition, communal work, sports activities and seminars... they were also involved in the 'majlis berbuka puasa' and 'sahur' (events).

"The youth were also involved in distributing food, groceries such as biscuits, coffee, milo, sugar and tea as well as T-shirts to the community," he said.

Tengku Adnan said that for both instances, he had earmarked the donation from Chai as the source of funds and had used his own money as an advance.

He said Chai was issued a receipt with the number 09-376241 dated June 14, 2016 by Umno for the RM2 million donation.

The receipt bore Tengku Adnan's signature and was tendered as evidence prior to the defence being called.

However, he testified that Umno's receipt books were not under "strict control" as they were kept at the Umno headquarters and multiple staff have access to it.

"The official receipt books are used randomly, not according to book number or receipt number," he said.

Tengku Adnan testified that he had no need for the RM2 million as he was already wealthy even before his foray into politics.

He said Tadmansori Holdings was a family business which deals in manufacturing, trading, agriculture, food, hotel and other activities.

He said he was comfortable financially and absolutely had no intention to receive the RM2 million for his own use.

"I wish to add that if I had intended to utilise the money for myself, I would not have deposited that cheque into the company account of Tadmansori Holdings Sdn Bhd.

"I have a wide experience in the business field and I knew that the bank documents would reflect that the cheque was deposited into the company's account," he said.

Tengku Adnan has been charged with receiving the RM2 million, in his capacity as Federal Territories minister, through his company from Chai.

Prosecutors are accusing Tengku Adnan of violating Section 165 of the Penal Code, which prohibits a public servant from obtaining something of value from a person with vested interest.

If found guilty, Tengku Adnan can be jailed up to two years, fined or both.