Apex Court Strikes Out Lagos VAT Suit Against FG

Supreme court

The Supreme Court on Friday struck out a suit in which the Lagos State Government challenged the powers of the Federal Government to assess and collect taxes on the supply of goods and services within the state.

In a unanimous decision, a panel of justices of the Supreme Court upheld the Federal Government’s preliminary objection that the apex court lacked the jurisdiction to hear the suit on the ground that it concerned acts of a federal agency and could not therefore form the basis for invoking the original jurisdiction of the court, as sought by the Lagos State Government.

In the lead judgment prepared by Justice M. D. Mohammed, the Supreme Court equally held that the suit was an abuse of court process, as argued by the Federal Government.

The Supreme Court maintained that, rather than coming before it to appeal the earlier rejection of the suit at the high court and court of appeal, the plaintiff approached the apex court with similar reliefs, asking the court to invoke its original jurisdiction and hear the matter.

Striking out the suit, the apex court described it as “an abuse of court process in the extreme,” adding that the action of the plaintiff amounted to “forum shopping.”

Having declined jurisdiction to hear the suit, the Supreme Court held that it was not necessary to determine the issues raised by the Lagos State Government in the suit.

“It is accordingly unnecessary to delve into the issues having declined jurisdiction. The preliminary objections raised against the competence of the plaintiff’s suit succeeds and the plaintiff’s suit is hereby struck out,” Justice Mohammed stated.

The Lagos State Government had in the suit asked the court to abolish the Value Added Tax Act, which it said infringed on its power to assess and collect taxes on the supply of goods and services within its territory.

The apex court was also asked to declare that the VAT Act was outside the legislative competence of the National Assembly and is therefore unconstitutional, null and void and of no effect whatsoever.

The Attorney-General of Lagos State, Ade Ipaye, however, insisted that the Supreme Court ought to have nullify the VAT Act and granted its reliefs, which according to the brief of argument, includes a declaration that the VAT Act “is outside the legislative competence of the National Assembly and is therefore unconstitutional, null and void and of no effect whatsoever.”

Lawyer to the Federal Government, Adedara Adedeji, in his response to the judgment applauded the apex court for upholding its preliminary objection by dismissing the suit.

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