Appeal Court rejects plea to dislodge FIRS from VAT collection

• Reserves ruling on Lagos joinder application

The Court of Appeal on Thursday declined to accede to the request of Rivers and Lagos states for the appointment of receiver or manager for the purpose of collecting and keeping Value Added Taxes (VAT) in place of the Federal Inland Revenue Services (FIRS) pending the resolution of all legal disputes in the matter.

The two states separately canvassed that the order of status quo ante belum granted on September 10, 2021, by the court in favour of FIRS to continue the collection be put on hold in view of the appeal already logged at the Supreme Court against the order.

Counsel to Rivers State, Chief Ifedayo Adedipe (SAN) in his oral application pleaded with the appellate court to exercise its power under Order 4 Rule 6 of the Court to appoint a Receiver or Manager to take custody of the VAT in the interest of justice to parties in the matter.

Attorney General of Lagos, Mr Moyosore Onigbanjo (SAN) who toed the path of the submission of Rivers specifically asked the Appeal Court to restrain FIRS from further collecting the tax and replace it with a Receiver or Manager that will act for patties in the appeal.

The Lagos Attorney General predicated his expressed fear of unjust treatment on the fact that FIRS, apart from collecting the tax has been sharing It among the 36 states and the Federal Capital Territory FCT despite the pendency of the legal battle.

He further submitted that, should the court uphold the judgement of the Federal High Court, which stopped FIRS from collecting VAT in the state, the funds shared to other states can need to come back to the state again.

The three-member panel of Justices of the court, headed by Justice Hamma Simon Tsanami asked the two states to put their request in writing.

Meanwhile, the Court has reserved a ruling in the application by Lagos to join it as a respondent in the appeal filed by FIRS against a judgement granted in favour of Rivers State by a federal high court in Port Harcourt.

Onigbanjo who moved the application argued that Lagos has vested interest in the Value Added Taxes collection and that the decision of the Court would affect It when delivered.

The Attorney General informed the panel that FIRS, in its appeal against the federal high judgment made some allegations against It and that it would be in the interest of justice for it to be allowed to join in the appeal to ventilate its defence.

“From the contents of the appellants’ affidavit, Lagos has been made a necessary party in the appeal by some references to It and for it to be bound by the final decision, It is in the interest that It should be allowed to make a defence to allegations against It.”

FIRS as the appellant through its counsel, Mahmoud Magaji (SAN) opposed the request by Lagos state to join in the appeal, adding that that the state has not shown how its interest would be jeopardized if not allowed in the matter.

Processes filed by the Attorney General of the Federation (AGF) Abubakar Malami (SAN) through his counsel, Tijani Gazali (SAN) were struck out for been incompetent having been filed out of time.

After taking arguments from parties, Justice Tsanami reserved the ruling adding that parties would be communicated when the ruling is ready.

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