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Tax Dispute: Court Adjourns MTN’s Suit Against AGF Till January 31, 2020

A Federal High Court Lagos on Tuesday adjourned  the hearing on a suit filed by MTN Nigeria Communication Ltd, against the Attorney General of the Federation (AGF), Abubakar Malami, over alleged N242 billion and 1.3 billion dollars import duties and withholding tax assessments until Jan. 30 and Jan. 31, 2020,

It would be recalled that the telecommunications company had filed the suit by a writ, on September 10, 2018, challenging the legality of the AGF’s assessment of its import duties, withholding tax  (WT) and value added tax (VAT)  in the sums of N242 billion and 1.3 billion dollars.

Specifically, the plaintiff is seeking, a declaration that the AGF’s demand of the sums of N242 billion and 1.3 billion dollars from the telco is premised on a process which is malicious, unreasonable and made on incorrect legal basis, amongst other declaratory reliefs.

When the case was mentioned, the Plaintiff’s legal team headed by Chief Wole Olanipekun, SAN, announced appearance for the Plaintiff while a State Counsel from the Federal Ministry of Justice, Mr T.A. Gazali, together with Mr Terhember Agbe announced appearances for the AGF.

Olanipekun told the court about his readiness to proceed with trial but informed that he had been intimated by the respondent about his inability to proceed with trial due to his representation of the government in another matter.

The Plaintiff’s lead counsel also informed the court that he had filed a reply to the plaintiff’s motion and had served same on him, adding however that since the respondent said he required time to study same, it will only be fair to give him the needed time to do so.

This is even as Gazali also informed the court of his motion seeking extension of time to regularise his processes.

After listening to the consensual pleas of  the parties, Justice Chukwujekwu Aneke, vacated the November 31 initial date and adjourned the hearing of the case until Jan. 30 and 31, 2020.

The telco, in its writ of summons, seeking declaratory reliefs on the following grounds: That the purported “Revenue assets investigation” allegedly carried out by the Federal Government on MTN, for the period of 2007 to 2017, and its decision conveyed through the office of the AGF by a letter dated Aug. 20, violates the provisions of section 36 of the constitution and a Declaration that the AGF acted in excess of its powers, by purporting to direct through its letter of May 10, a “self assessment exercise” which usurps the powers of the Nigerian Customs Service to demand payment of import duties on importation of physical goods.

Others are a Declaration that the AGF acted illegally, by usurping the powers of the Federal Inland Revenue Service, to audit and demand remittance of withholding tax and value added tax, a Declaration that the purported “self assessment” exercise instituted by the AGF via its letter of May 10, is unknown to law, null and void and of no effect whatsoever.

Also, the plaintiff  is seeking a court order to vacate the AGF’s demand letter dated Aug. 20, for the sums of N242 billion and 1.3 billion dollars from MTN Nigeria Communications Ltd as well as claiming a total sum of N3 billion in damages, against the defendant, covering alleged general damages, exemplary damages, and legal costs.

In his preliminary objection, the AGF  had argued that the plaintiff in seeking redress to the subject matter, has just three months from the date the cause of action arose, to institute the action but that the plaintiff commenced the suit in clear disregard to Section 2 of the Public Officers Protection Act, which provides that any action commenced against a public officer, must be made within three months from commencement of cause of action.

Malami argued further that plaintiff’s failure to commence the suit within three months as stipulated by law, denied the court of jurisdiction to entertain same.

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