VAT: Appeal Court stops Lagos, Rivers, others
The Court of Appeal in Abuja on Friday ordered parties in the dispute over the administration of the Value Added Tax (VAT) to stay action pending the resolution of all legal issues in contention.
A three-member panel of the court ordered parties to maintain status quo ante bellum and refrain from acts capable of jeopardizing the res (subject of the dispute).
The court agreed with the lawyer to the Federal Inland Revenue Service (FIRS), Mahmud Magaji (SAN) that, having submitted to its (the court’s) jurisdiction, it was incumbent on parties to preserve the res.
Justice Haruna Simon Tsanami, in the lead ruling, ordered parties not to give effect to the August 9 judgment of the Federal High Court in Port Harcourt and the VAT law enacted by Rivers State.
The court ordered parties to hold their peace pending the hearing of the application filed by the FIRS for stay of execution of the judgment given by Justice Steven Pam in favour of Rivers State to collect VAT in the state.
The court equally granted leave to the Lagos State Government to bring an application to be heard in the case as an interested party in the appeal filed by FIRS against the Federal High Court judgment.
It noted that Lagos State’s right would be adversely affected if not heard.
The court then adjourned till September 16 for the hearing of pending applications, including the joinder application by Lagos.
In his August 9 judgement in a suit filed by the Rivers State government, Justice Stephen Pam of the Federal High Court, Port Harcourt, had held that the applicant (state government) and not the FIRS, has the right to collect VAT, Personal Income Tax in the state.
He restrained the Attorney General of the Federation (AGF) and FIRS (1st and 2nd defendants) from collecting VAT in Rivers and directed the Rivers State government to take charge of the duty.
The Lagos State House of Assembly soon followed suit and passed a similar law empowering the state government to collect VAT in the state.