MTN Sues FG over $1.3bn Withholding Tax

MTN Nigeria Communication Limited has filed a fresh suit at the Federal High Court in Lagos to challenge the legality of the $1.3 billion import duties and withholding tax demanded from it by the federal government.

It is demanding N3billion general and exemplary damages and legal costs from the defendant.

Justice Chukwujekwu Aneke yesterday adjourned the suit until December 3 for hearing after counsel confirmed that motions have been filed and served on parties.

MTN, in the suit filed, is challenging the legality of the Attorney-General of the Federation’s assessment of its import duties, withholding tax and value added tax amounting to N242 billion and $1.3 billion.

It is contending that the purported “revenue assets investigation” allegedly carried out by the federal government for the period of 2007 to last year, and its decision conveyed through the Office of the AGF by an August 20 letter, violates the provisions of Section 36 of the 1999 Constitution.

The plaintiff sought a declaration that the AGF acted in excess of its powers by purporting to direct through its letter of May 10 a “self-assessment exercise” which usurps the powers of the Nigerian Customs Service to demand payment of import duties on importation of physical goods.

MTN sought a declaration that the AGF acted illegally by usurping the powers of the Federal Inland Revenue Service (FIRS) to audit and demand remittance of withholding and value added taxes.

It is praying the court to hold that the purported selfassessment exercise instituted by the AGF via its May 10 letter is unknown to law, and therefore null and void and of no effect whatsoever.

It prayed for a declaration that the AGF’s demand of the sums is premised on a process that is malicious, unreasonable and made on incorrect legal basis.

MTN prayed for an order vacating the AGF’s demand letter for N242 billion and $1.3 billion, and claimed N3 billion general and exemplary damages, as well as legal costs.

But, the AGF, in his preliminary objection, argued that the plaintiff was statute-barred, having not filed the suit within three months from the date the cause of action arose.