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Business News of Wednesday, 15 September 2021


VAT battle shifts to Supreme Court, as Rivers seeks setting aside A’Court order

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Rivers Government has has approached the Supreme Court to set aside the interim order of injunction issued by the Court of Appeal restraining it from executing the judgment of the Federal High Court Port Harcourt according it with the legal right to collect Value Added Tax (VAT) and Personal Income Tax (PIT) in the state.

Besides, the state is seeking an order directing that the appeal lodged by the FIRS at the Court of Appeal be heard and determine by a new panel of justices of the court other than those that granted the order for the maintenance of status quo ante belium.

Consequent upon its appeal, the state government has equally filed a motion for the stay of execution of the order for the maintenance of status quo ante bellum pending the hearing and determination of it’s appeal at the Supreme Court.

The motion dated September 14, 2021, was brought pursuant to order 4 Rule 6 of the Court of Appeal Rules 2016.

The River government argued that any further steps taken by the FIRS pursuant to the aforesaid order of the Court of Appeal would render the judgment of the Supreme Court in it’s appeal nugatory.

In the said judgment that was delivered on September10, Justice Stephen Pam who stopped the Federal Inland Revenue Services (FIRS) VAT and PIT in Rivers State, held that it is the Rives State Government and not the FIRS that should collect VAT and PIT henceforth in the state.

The court also issued an order of perpetual injunction restraining the Federal Inland Revenue Service and the Attorney General of the federation, both first and second defendants in the suit, from collecting, demanding, threatening and intimidating residents of Rivers State to pay to FIRS, personnel income tax and Value Added Tax.

Dissatisfied with the said judgment, the FIRS approached the Abuja division of the Court of Appeal with a motion for a stay of execution of the judgment.

But while adjourning hearing of the motion to Thursday September 16, the appellate court had upon an oral application by counsel to the FIRS, Mahmud Magaji (SAN), made an order for the maintenance of status quo ante bellum/injunction directing parties to maintain status quo ante bellum.

Justice Haruna Tsanami who led the three member panel of the Court of Appeal ruled that it was for the overriding interest of justice for the parties who submitted themselves before the court not to take further steps that would destroy the res.

“It is hereby ordered that status quo ante belium should be maintained pending the hearing of the motion,” the judge ruled.

But in a 10 grounds of appeal, the Rivers state Government, through it’s lead counsel, Emmanuel Ukala (SAN) has urged the Supreme Court to set aside the decision of the Court of Appeal and to equally dismmised the oral application by the FIRS.