Government Of Akwa Ibom State V. Barrister Livinus Udofia (2010)

LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL

KUMAI BAYANG AKAAHS, J.C.A. (Delivering the Leading Judgment)

The Plaintiff now Respondent took out an Originating Summons seeking a determination whether by the provisions of Section 1(1) and Section 2(1) of the Taxes and Levies (Approved List for Collection) Act Cap T2 Vol. 14 Laws of the Federation of Nigeria 2004 the Government of Akwa Ibom State is entitled to engage the services of consultants to collect the revenue accruing to her. He then sought the following reliefs:-

1. A DECLARATION that the Government of Akwa Ibom state is not entitled to use Revenue consultants or consultants by whatever name called to collect revenue accruing to her.
2. AN ORDER of perpetual injunction restraining the Government of Akwa Ibom State from using consultants in the collection of revenue.

The Summons was supported with an affidavit of 18 paragraphs to which was annexed Exh. “A” which is a document prepared by Olusola Adekanola & Co. being commission for revenue purportedly collected for the Akwa Ibom State Government. A conditional appearance was entered on behalf of the Defendant/Appellant. Notice of Preliminary objection dated 10th December, 2007 was filed on 17/12/2007 and on7/1/2008, a 14 paragraph counter-affidavit was filed challenging the locus of the Plaintiff in initiating the action. In a well considered Ruling delivered on 16/4/08 the learned trial Judge held overruling the objection, that the plaintiff had the requisite power and interest to invoke the jurisdiction of the court to determine whether or not the use of Consultants by the Defendant to collect the revenue complained about is in the spirit and within the ambit of Taxes and Levies (Approved List for Collection) Act Cap. T2 Vol. 14, Laws of the Federation of Nigeria 2004. He accordingly dismissed the objection. Aggrieved by this decision the Defendant filed its Notice of Appeal dated 21/7/2008 on 23/7/2008 containing one ground of appeal from which the following issue was distilled for determination:

“Whether the Respondent as Plaintiff in the lower court had disclosed sufficient interest over and above that of every other citizen of Akwa Ibom State to clothe him with overriding right and/or locus standi to sue the Appellant in respect of the Appellant Government Policy with regard to Section 1(1) and 2(1) of Taxes and Levies (Approved List for Collection) Act, Cap T2Vol. 14 Laws of the Federation of Nigeria 2004.”

The Respondent also formulated the following lone issue for determination:

“Whether the learned trial Judge was right in holding that the Respondent has the locus standi to bring the action against the Appellant.”

Arguing the appeal, Anietie Inyang, Chief State Counsel submitted by citing ABRAHAM ADESANYA v PRESIDENT OF NIGERIA (1981) 5 SC 112; (1981) 12 NSCC 146 that the Plaintiff will have locus standi in the matter only if he has a special legal right, or alternatively, he has sufficient or special interest in the performance of the duty sought to be enforced, or where his interest is adversely affected. He submitted that the depositions in support of the originating summons are self contradictory and the entire suit of the respondent is hinged on paragraphs 6, 7 and 8 of the affidavit in support. He contended that the respondent has not disclosed he is a tax payer and that the use of tax consultants to collect revenue has affected him personally or his business over and above all other citizens of Akwa Ibom State. He further contended that since the action is to assert or protect a public right, it is only the Attorney-General of the Federation that has the requisite locus to sue, and the Respondent had to obtain the Attorney-General’s fiat to institute the action. He is therefore totally disqualified to have the standing to bring an action to enforce the performance of a public duty.

The Respondent submitted in his own brief that the issue of special right or interest is to be looked at holistically and in the instant case he has shown that there is a clear breach of the federal enactment that the appellant is under an obligation to obey. He said that the consultants are not in anyway engaged in the collection of the revenue, yet they are earning commission for work not done.

Since he disclosed he is an indigene of Akwa Ibom State and residing thereat, the money paid as commission to consultants for work not done is illegal and has caused a deliberate and insidious leakage in the treasury of the appellant and he has therefore suffered detriment since the money which ought to have been used to provide basic amenities to him and others has been deliberately wasted. In the locus classicus of ADESANYA v PRESIDENT OF THE FEDERAL REPUBLIC OF NIGERIA (1981) 5 SC 112, Fatayi-Williams, CJN, stated the law on locus standi at page 140 as follows:

‘…… in cases where a plaintiff seeks to establish a “private right” or “special damage” either under the common law or administrative law, in non-constitutional litigation, by way of an application for certiorari, prohibition, or mandamus, or for a declaratory or injunctive relief, the law is now settled that the plaintiff will have locus standi in the matter only if he has a special legal right or alternately, if he has sufficient or special interest in the performance of the duty sought to be enforced, or where his interest is adversely affected.”

The Respondent in the instant appeal is challenging the Akwa Ibom State Government policy in the appointment of consultants who are being paid commission on the taxes that accrue to the State Government on P.A.Y.E. Contrary to the argument of the respondent that the decision of the State Government in using revenue consultants to collect its taxes is a clear breach of the Taxes and Levies (Approved List for Collection) Act, there is noting in the Act that stipulates the manner in which those taxes accruable to the State should be collected. Rather the complaint is that the Tax Consultants play no role whatsoever in the collection of the P.A.Y.E. to be entitled to a commission since the said taxes are deductable at source and remitted by the employers to the State Government. So the question to be settled is: Does the Respondent have the legal standing to challenge the policy? In his affidavit in support of the Originating Summons, the Plaintiff/Respondent deposed to the following facts in paragraphs 2, 3, 4, 6, 7, 8, 9, 10, 11, 12, 13, 14 and 15 therein:

“2. I am an indigene of Akwa Ibom state of Nigeria and I am resident in Eket where I am engaged in the business of legal practice.

3. The revenue accruing to the Government of Akwa Ibom state is meant to used (sic) to in

Akwa Ibom State including myself.

4. The Akwa Ibom State Government is purportedly using consultants to collect internally generated revenue and one of these consultants is Olusola Adekanole and Company.
5. The Consultant plays no role whatsoever in the collection of pay as you earn tax from employees of banks and companies operating in Akwa Ibom State.
6. The consultant no role in the collection of filling fees from litigants in the District Courts, Magistrate Courts and High Court across the State.
7. The consultants play no role in the collection personal income tax from Local Government employees. 9. These companies, banks and the various Local Government (sic) drew cheques for monies deducted as income from employees and they pay same directly into account designated by the Internal Revenue Service of Akwa Ibom State.
8. I know as a fact from my vantage position as a lawyer in legal practice that staff of these consultants do not play any role in the collection of revenue generated by the Judiciary.
9. These consultants are paid commission from monies paid into these designated account by various obligors.
10. The amount paid out as commissions to the various consultants every month for work not done by them is over N80,000,000,00. (Eighty Million Naira).
11. The annual sum that is deliberately or inadvertently lost to these consultants by the Government of Akwa Ibom State is enormous.
12. This sum if properly utilized could cause water to run from the taps in the premises and houses of Akwa Ibomites in the urban centers across the State.
13. I know as a fact that the use of consultants or by whatever name called is unlawful and forbidden ”

Mrs. Grace J. Akpan, Principal Litigation Officer in the chambers of the Attorney-General, Ministry of Justice, Uyo, deposed to a 14 paragraph affidavit in opposition to the Originating Summons.