CORAM

---

Mohammed Lawal Garba-Justice of the Supreme Court of Nigeria

Adamu Jauro-Justice of the Supreme Court of Nigeria

Jummai Hannatu Sankey-Justice of the Supreme Court of Nigeria

Obande Festus Ogbuinya-Justice of the Supreme Court of Nigeria

Abubakar Sadiq Umar-Justice of the Supreme Court of Nigeria

---

PARTIES

---

TSKJ CONSTRUCOES INTERNACIONAL SOCIADADE UNIPERSSOAL LDA

APPELLANTS 

---

FEDERAL INLAND REVENUE SERVICE

RESPONDENTS 

---

AREA(S) OF LAW

---

TAX LAW, CONSTITUTIONAL LAW, ADMINISTRATIVE LAW, CIVIL PROCEDURE, APPEAL, PRACTICE AND PROCEDURE, JURISDICTION, TRIBUNAL LAW, REVENUE LAW, STATUTORY INTERPRETATION

 

---

SUMMARY OF FACTS

The Appellant, TSKJ Construcoes Internacional Sociadade Uniperssoal LDA, a Portuguese company and non-resident taxpayer, obtained a contract for executing a Liquefied Natural Gas (LNG) project for Nigerian LNG Limited (NLNG). To execute the contract, the Appellant incorporated TSKJ Nigeria Ltd to provide local logistics and support services.

During project execution, the Appellant filed and paid taxes using self-assessment on deemed profit basis (Turnover Assessment) and made deductions called ‘Recharges’, being costs paid to its local subsidiary, TSKJ Nigeria Ltd. Upon review of this self-assessed tax, the Respondent (FIRS) disallowed the ‘Recharges’ deduction on the ground that such deduction is not allowed under Turnover Basis of Assessment and issued additional tax assessments totaling US$12,924,947.

TSKJ objected to the additional assessment, and when FIRS issued a Notice of Refusal to Amend, TSKJ appealed to the Tax Appeal Tribunal (TAT) seeking to set aside the additional assessments. The TAT dismissed the appeal and ordered payment of the additional assessed tax. TSKJ then appealed to the Federal High Court, which held that the TAT lacked jurisdiction over federal taxation matters, being within the exclusive jurisdiction of the Federal High Court under Section 251(1)(a)&(b) of the Constitution.

The Federal High Court also declared the additional tax assessments invalid and ordered disbandment of Tax Appeal Tribunals. FIRS appealed to the Court of Appeal, which held that the TAT had jurisdiction as an administrative tribunal and that appeals from TAT to Federal High Court must be on points of law only. The Court of Appeal set aside the Federal High Court judgment and restored the TAT decision, leading to this Supreme Court appeal.

 

---

HELD

---

1. The appeal was dismissed.

2. The Court held that a single competent ground of appeal can sustain a Notice of Appeal even where other grounds are incompetent.

3. The Court affirmed that the Tax Appeal Tribunal is an administrative tribunal, not a court, and has jurisdiction to entertain tax disputes as a condition precedent to Federal High Court jurisdiction.

4. The Court distinguished cases involving VAT Tribunal which attempted to usurp Federal High Court jurisdiction.

5. The Court awarded costs of N5,000,000 to the Respondent against the Appellant.

6. The Court disapproved the Appellant’s conduct in challenging the jurisdiction of a tribunal it had voluntarily approached.

 

---

ISSUES

---

1. Whether the Court of Appeal was correct to have held that the Notice of Appeal was incompetent because it contained grounds of mixed law and facts?

2. Whether the Tax Appeal Tribunal possessed the requisite jurisdiction to entertain the subject matter of the appeal?

3. Whether the Court of Appeal ought not to have considered the preliminary objection under its general powers?

 

---

RATIONES DECIDENDI

---

NOTICE OF APPEAL – COMPETENT GROUNDS SUSTAINING APPEAL:

---

“As this Court has had occasion to re-iterate again and again, our Courts must be wary of depriving litigants of the due exercise of their constitutional rights of appeal on technistic or narrow grounds which mock the substance of justice. It is no longer open to debate that the long-settled position is that one valid ground can sustain an appeal.” – Per JUMMAI HANNATU SANKEY, J.S.C.

 

---

NOTICE OF APPEAL – SINGLE COMPETENT GROUND SUSTAINING APPEAL:

---

“On the other hand, a notice of appeal can be sustained by a single competent ground of law.” – Per JUMMAI HANNATU SANKEY, J.S.C.

 

---

TAX APPEAL TRIBUNAL – NATURE AND PURPOSE:

---

“The Tax Appeal Tribunal is an administrative tribunal set up to determine the correctness of assessment to tax without undue fixation with formality.” – Per JUMMAI HANNATU SANKEY, J.S.C.

 

---

TAX APPEAL TRIBUNAL – QUASI-JUDICIAL FUNCTIONS:

---

“The last fact-finding tribunal comprising of a panel of experts who determine the appropriate tax liability on all available data without undue adherence to strict application of the Evidence Act while ensuring compliance with the principles of fair hearing.” – Per JUMMAI HANNATU SANKEY, J.S.C.

 

---

QUASI-JUDICIAL ACTION – DEFINITION AND SCOPE:

---

“… a phrase applied to the act of discretion of public administrative officers or bodies, who are required to investigate facts, ascertain evidence of facts, hold hearings, weigh evidence and draw – conclusions from them as a basis for their official action to exercise discretion of a judicial nature.” – Per JUMMAI HANNATU SANKEY, J.S.C.

 

---

ADMINISTRATIVE TRIBUNALS – DISTINCTION FROM COURTS:

---

“The summary of all that I have been trying to say is that looking at the provision establishing the Tax Appeal Tribunal, its duties, functions and composition, there is no argument that the TAT is purely an administrative tribunal, one which carries out quasi-judicial functions, as opposed to a Court as defined in Section 6(3)&(5) of the 1999 Constitution.” – Per JUMMAI HANNATU SANKEY, J.S.C.

 

---

FEDERAL HIGH COURT JURISDICTION – EXCLUSION OF OTHER COURTS:

---

“What this means is that the bodies precluded by Section 251(1)(b) of the CFRN from exercising the jurisdiction provided therein are other Courts, hence the phrase ‘to the exclusion of any other Court’, in the clause.” – Per JUMMAI HANNATU SANKEY, J.S.C.

 

---

COURTS VERSUS TRIBUNALS – CONSTITUTIONAL DISTINCTION:

---

“The term ‘Court’ in that provision means another Court which forms part of the judicature of the Federal Republic of Nigeria in the sense of Section 6(3) and (5) of the CFRN, 1999, Clearly and without any iota of doubt, the Tax Appeal Tribunal is certainly not one them. This is in line with the saying that ‘all Courts are tribunals, but not all tribunals are Courts.'” – Per JUMMAI HANNATU SANKEY, J.S.C.

 

---

DEEMING PROVISIONS – LEGAL EFFECT:

---

“If an institution is actually a Court, you would not need to deem it a Court. A deeming clause would only be needed where the institution is NOT a Court. This is thus an acknowledgement that the Tribunal is not a Court.” – Per JUMMAI HANNATU SANKEY, J.S.C.

 

---

TAX APPEAL TRIBUNAL – CONDITION PRECEDENT TO FEDERAL HIGH COURT:

---

“The cumulative effect of these provisions is that the Tax Appeal Tribunal is a mere administrative tax appeal tribunal which is not on concurrent jurisdiction with the Federal High Court nor can it in a way be capable of usurping the jurisdiction of the Federal High Court. It serves as an administrative procedure or condition precedent to instituting actions, tax related actions, before the Federal High Court.” – Per JUMMAI HANNATU SANKEY, J.S.C.

 

---

EXHAUSTION OF STATUTORY REMEDIES – CONDITION PRECEDENT:

---

“Where a statute prescribes a legal line of action for determination of an issue be that issue an administrative matter, chieftaincy matter or a matter of taxation, the aggrieved party must exhaust all the remedies in that law before going to Court.” – Per JUMMAI HANNATU SANKEY, J.S.C.

 

---

DEEMING PROVISIONS – MEANING AND APPLICATION:

---

“Generally speaking when you talk of a thing being ‘deemed’ to be something, you do not mean to say that it is that which it is deemed to be. It is rather an admission that it is not what it is to be ‘deemed’ to be, and that, notwithstanding, it is not that particular thing, nevertheless it is still ‘deemed’ to be that thing.” – Per ADAMU JAURO, J.S.C

 

---

APPROBATION AND REPROBATION – PROHIBITION AGAINST INCONSISTENT POSITIONS:

---

“It amounts to sheer duplicity on the part of the Appellant to have approached the Tax Appeal Tribunal to seek redress from the tribunal against the Respondent on the disputed tax assessment only for the same Appellant to turn around to contend that the same Tax Appeal Tribunal lacks jurisdiction over the subject matter when the decision of the Tribunal is not favourable to it. I think that is utterly reprehensible. A party should not approbate and reprobate at the same time.” – Per ABUBAKAR SADIQ UMAR, J.S.C.

 

---

CASES CITED

---

---

STATUTES REFERRED TO

---

• Constitution of the Federal Republic of Nigeria 1999 (as amended)

• Federal Inland Revenue Service (Establishment) Act 2007

• Companies Income Tax Act (CITA) Cap. C21, Laws of the Federation of Nigeria, 2010

• Personal Income Tax (Amendment) Act (PITA) 2011

• Federal High Court Act

• Court of Appeal Act

• Supreme Court Act

• Value Added Tax Act 1993

• Supreme Court Rules 2024

 

---

CLICK HERE TO READ FULL JUDGMENT