VAT: Appeal Court orders Rivers, Lagos to maintain status quo

The Court of Appeal sitting in Abuja has ordered that the status quo ante bellum be maintained in Lagos and Rivers state, over the matter before it concerning the collection of value added Tax in the two states.

The court also adjourned to September 16 to hear the application by Lagos State to be joined as a respondent alongside Rivers State in the appeal filed by the Federal Inland Revenue Service challenging the judgment of the Federal High Court, Port Harcourt regarding the issue of Value Added Tax collection.

Justice Haruna Tsammani held that parties should refrain from taking any step regarding the Federal High Court judgment pending the determination of the application on stay of execution filed by FIRS.

The Federal High Court, Port Harcourt, had on Aug. 9 declared that it was the Rivers government and not FIRS that should collect VAT and Personal Income Tax in that state.

The three-man panel of Appeal Court justices led by Justice Hassan Tsammani ordered all parties to maintain status quo and refrain from taking any action that would give effect to the judgment of the Federal High Court, Port Harcourt.

Justice Tsammani held that since all parties in the matter had submitted themselves before the court, it was proper and the law for the court to preserve the res (subject matter) from being rendered nugatory.

Consequently, the court held that parties should refrain from giving effect to the judgment of the trial court in Port Harcourt pending the hearing and determination of the application of the FIRS to stay execution of the trial court’s judgment.

Parties are also to maintain status quo pending the hearing of an application by the Attorney-General of Lagos State to be joined as a party in the matter.

Counsel to the appellant/applicant, Mr Mahmud Magaji (SAN), made an oral application for an order that status quo be maintained pending the hearing and determination of the motion for injunction and stay.

However, Mr Emmanuel Ukala (SAN), counsel to Rivers government, and Mr Oyosore Onigbanjo (SAN), counsel to Lagos State government, both opposed the application for status quo.

Mr Tijani Ghazali (SAN), who represented the attorney-general for his part, supported the application for status quo to be maintained.

The applicants have been given two days to file their written addresses in respect to the pending applications just as the respondents have also been given two days to file, and the applicant has one day to reply on points of law.

The matter has been adjourned until Sept. 16.

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