Lagos and Rivers states have asked the Court of Appeal in Abuja to restrain the Federal Inland Revenue Service (FIRS) from collecting VAT pending the resolution of the suit challenging the legality of its action.
The FIRS prayed the appellate court to reject Lagos’ bid to be joined in its appeal seeking to upturn the Federal High Court judgment which gave the authority for VAT collection to the Rivers State government.
FIRS argued that Lagos State was not a necessary party, and that if Lagos must be joined, then the rest of the 34 states should also be joined.
The court proceedings coincides with a meeting of governors of the 17 Southern states, at their third summit this year in Enugu, where they gave their backing to the judgment allowing states to collect VAT.
Counsel for Rivers, Chief Ifedayo Adedipe (SAN), applied orally to the court to exercise its powers under Order 4 Rules 6 of the court’s Rules to appoint either a receiver or manager to take custody of the res (subject of dispute) pending the determination of the appeal.
Lagos Attorney-General, Moyosore Onigbanjo (SAN), added that the court needed to balance the equity as it relates to its earlier order directing parties to maintain status quo antebellum.
He said: “I think it is also necessary to restrain the FIRS, because they collect the VAT, distribute to all the states and keep their own four per cent.
“If, at the end of the day, the court agrees with the judgment of the Federal High Court, how do we retrieve the funds that have been shared?”
Justice Haruna Simon Tsanami, who led a three-member panel, directed them to make the application formal by providing the necessary facts, including ascertaining the amount being collected as VAT.
Other members of the panel are Justices Bature Gafai and Peter Affen.
The court reserved a ruling on Lagos’ application to be made a respondent. The appellate court said parties would be informed when the ruling is ready.
