VAT Dispute: Rivers Govt Files Appeal At Supreme Court

The Rivers State government has approached the Supreme Court challenging the ruling of the Court of Appeal in the Value Added Tax, VAT, dispute between the state and the Federal Inland Revenue Service, FIRS.

Counsel to the state, Emmanuel Ukala, SAN, alongside three other senior lawyers filed a notice of appeal at the apex court, sources said on Tuesday.

According to the sources, the Attorney-General of Rivers State is the appellant while the FIRS and Attorney-General of the Federation, AGF, were joined as respondents.
The state government, in its 10 grounds of appeal dated September 13, informed the Supreme Court that it was dissatisfied with the decision of the appellate court delivered on Friday last week in which all parties were directed to maintain status quo.
It explained that the implication of the ruling of the appellate court was that parties were restored to their positions before a Federal High Court in Port Harcourt granted the Rivers State government the right to collect VAT, instead of the FIRS on August 9.
In one of the grounds of appeal, Rivers State alleged that the appeal court erred in law when it relied on the provisions of Section 6(6) of the Constitution and its inherent jurisdiction to found its decision to make an order to maintain status quo in the matter, pending the determination of an appeal filed by FIRS.
According to it, the appellate court in relying on its inherent jurisdiction to make the order failed to appreciate that its inherent jurisdiction cannot be applied in contravention of statutory provisions.
The state government, therefore, sought relief of the Supreme Court to allow the appeal, set aside the decision of the appeal court which they complained about, and dismiss the oral application for interim injunction made by the FIRS.
It further urged the apex court to order that the substantive appeal by the FIRS and all other processes, be heard and determined by a new panel of the Court of Appeal.
Following the judgement delivered by Justice Stephen Pam of the Federal High Court, Rivers State Governor, Nyesom Wike, assented to the Valued Added Tax, VAT, Law, 2021, after the bill had earlier been passed by lawmakers in the Rivers State House of Assembly, along with four others that were also assented to by the governor.
But the FIRS, which was apparently displeased with the development, filed a motion on notice to apply for a stay of execution on the earlier judgement delivered by Justice Pam.
The court, in its ruling, refused the application, saying the federal agency failed to file an application to set aside the tax law recently enacted by the Rivers State House of Assembly.
Justice Pam, therefore, stated that the state law on VAT was valid and subsisting, paving the way for Governor Wike to direct the state’s revenue agency to fully implement the VAT law.
The FIRS later approached the Court of Appeal in Abuja with a civil motion seeking a stay of the execution of the judgement earlier granted by the court in Rivers pending the determination of the case.
The three-man panel of the appellate court led by Justice Haruna Tsammani then directed all parties to maintain the status quo and refrain from taking action that would give effect to the judgement delivered by Justice Pam, pending the hearing and determination of the instant suit.