The Court of Appeal sitting in Abuja, on Friday, ordered both Rivers and Lagos States to maintain status quo on the collection of Value Added Tax, VAT, pending the determination of an appeal that was lodged before it by the Federal Inland Revenue Service, FIRS.
The appellate court said the order was to preserve the ‘Res’ (subject matter) of the appeal before it.
Specifically, it ordered all the parties that have subjected themselves before it to “refrain from taking any action to give effect to the judgement of the Federal High Court”, which gave Rivers State Government the right to collect VAT revenue, instead of the FIRS.
A three-man panel of Justices of the appellate court led by Justice Haruna Tsammani made the order after it deferred hearing of an application Lagos State filed to be joined as an interested party in the matter, till September 16.
Lagos State had through its Attorney-General, Moyosore Onibanjo, SAN, protested against the issuance of an order for the maintainance of status quo, insisting that such order could not be binding on it, since it was yet to be joined as a party in the appeal by FIRS.
FIRS is in its appeal marked CA/PH/282/2021, praying the appellate court to not only set it aside the High Court judgement, but to also stay its execution.
It applied for an order of injunction to restrain Rivers State from interfering with its rights, duties and obligations, pending the conclusion of the appeal.
Meanwhile, when the matter came up on Friday, Lagos State, brought an application to be joined as a co-Respondent alongside Rivers State.
Whereas both Lagos State and counsel to Rivers State, Mr. Emmanuel Ukala, SAN, urged the appellate court to hear the joinder application first, counsel to FIRS, Mr. Mahmud Magaji, SAN, and that of the Attorney-General of the Federation, Mr. Tijjani Gazali, SAN, opposed the request, insisting that the substantive appeal be heard first.
In a short ruling, the Appeal Court panel said it was minded held that it would be in the interest of justice to hear the joinder application by Lagos State first.
Immediately after the ruling was delivered, counsel to the FIRS, Magaji, SAN, made an oral application for an order directing all the parties to maintain status quo with respect to the subject matter of the appeal.
“My Lords, in view of the circumstances of this case and in view of the fact that this matter borders on revenue of this country, we will be urging this court to invoke its inherent powers in section 6(6) of the 1999 Constitution, as amended, and order that status quo be maintained pending the hearing and determination of our motion”, Magaji submitted.
While counsel to the AGF, Gazali, SAN, supported the application, both Rivers and Lagos States vehemently opposed it.
“This application is strange. The stay of execution would have been for the purpose of staying the enforcement of the judgement.
“My Lords, as it stands, that judgement is now the established status quo. It is common knowledge that the mere filing of an appeal does not constitute a stay.
“We submit that there is no basis whatsoever for this application. The judgement was clear that the Appellant has no legal or constitutional right at all.
“No material has been provided for this court to make an order with respect to the application”, Ukala argued as he urged the appellate court to refuse the request for order of status quo.
Lagos State AG, while adopting the position of Rivers State, contended that the High Court verdict remained valid and subsisting until it is set aside.
Besides, Lagos State stressed that such order for maintenance of status quo could not be binding on it since its joinder application has not been heard.
However, the appellate court panel said it saw the need to preserve the ‘Res’ of the appeal before it, noting that “the case is of very serious national importance”.
Before adjourning the joinder application by Lagos State for hearing, the appellate court ordered both the Appellant (FIRS) and the Respondents (Rivers and AGF) two days each to file their responses.
Vanguard
The appeal court is being used to contravene the existing laws of the state. Where the FG has failed, the states should know their onions. And this abysmally high level of the absence of true federalism needs to be adequately checked.