Elf Oil Nigeria Limited V. Oyo State Board of Internal Revenue (2002)

LawGlobal-Hub Lead Judgment Report

F. TABAI, J.C.A. 

By an originating summons dated the 17/2/98 issued at the Ibadan Division of the High Court of Oyo State, the Respondent herein claimed against the Appellant herein:

“A. Declaration that by virtue of the combined provisions of section 96 of the Personal Income Tax Decree (PITD) No. 104 of 1993 and Section 28 of Oyo State Internal Revenue Board Amended Edict 1997, the Applicant is empowered to distrain the Respondent of its goods, chattels, land and/or premises, etc, for non-payment of Business Premises Registration/Renewal rates levy and Tax being unremitted deduction in respect of PAYE and W.H.T. under the said law.

B. An order Restraining the Respondent of its goods, chattels, lands, premises, etc. for non-payment of N4,852,319.00 (Four Million Eight Hundred and Fifty-Two Thousand Three Hundred and Nineteen Naira only) being outstanding levy and tax payable by the Respondent to the Applicant under the Business Premises Registration/Renewal Rates, Pay as You Earn (PAYE) deductions and withholding Taxes for the years 1991 -.1996 until the settlement of the tax liability.

C. And for such further order or orders as this Honourable Court may deem fit to make in the circumstances.”

The summons was supported, by an affidavit of 17 paragraphs to which were attached exhibits A and B.

To this the Appellant filed a Notice of Preliminary Objection dated 18/3/98 and the grounds for the objection were stated therein to be:

“i. That the Plaintiff’s claim is a statute barred debt by virtue of sections 18 and 24 of the Oyo State Limitation Edict 1989.

ii. That this suit was not initiated by due process of law in that the originating summons through which this action was commenced contains no question or questions for determination by this Honourable Court as required by law.”

On the 20/4/98 arguments were taken on the preliminary objection and the ruling thereon was reserved for the 6/5/98.

In the meantime by an application dated and filed on the 23/4/98 the Respondent sought to amend the originating summons by substituting the sum of N4,852,319.00 claimed with the sum of N3,841.085 and abandoning the sum of N1,011,234.00 representing what it said to be the appellant’s liability for the year 1991. Paragraphs 3 and 4 of the supporting affidavit was that the effect that the claim for N1,011,234.00 for 1991 was statute barred and the sum N3,841,085.00 sought to be substituted for the original sum claim represented the Appellant’s liability from 1992 – 1996. This motion for the amendment of the claim was not taken until the 5/8/98 when the learned trial judge gave his ruling wherein the preliminary objection was dismissed. The present appeal is against that ruling of 5/8/98.

The Notice of Appeal filed at the High Court on the 10/5/98 contained 4 grounds of appeal which without their particulars are as follows:

“1. The learned trial judge erred in law in holding that the cause of action in this case arose in 1996 when the tax liability of the Appellant was actually assessed by the Respondent and not 1991 when the said tax ought to be paid by the Appellant.

2. The learned trial judge erred in law in holding that the paper entitled “Originating Summons” with which this action was filed confirmed with the provisions of Order 6 Rule 3 of the Oyo State High Court (Civil Procedure) Rules 1989.
3. The learned trial judge erred in law in holding that he has jurisdiction to try this case, when –

(a) Jurisdiction on the taxation of companies and other bodies established or carrying on business in Nigeria and all other persons subject to Federal TAXATION has been exclusively vested in the Federal High court by virtue of the Federal High Court Amendment Decree No. 60 of 1991 with effect from 26th August 1993. Therefore Oyo State Internal Revenue Board (Amendment) Edict No. 12 of 1997 which empowers the State High Court to exercise jurisdiction in this case is inconsistent with the said Decree 60 of 1991 and therefore null and void and of no effect whatsoever.