A limited liability company based in Lagos, engaged in the business of marine logistics Solutions, Homeland Integrated Offshore Services Limited, has dragged the Akwa Ibom State Government before a Federal High Court sitting in Ikoyi, Lagos State, Nigeria.
The action, according to the suit before the court was instituted in a move to forestall the payment of alleged double taxation.
Among other reliefs being sought by the firm is an order of the court to declare that the Akwa Ibom State Maritime Sector Regulation Law 2017, enacted by the Akwa Ibom Government is invalid, null, void, and ultra vires the powers of the Akwa Ibom State House of Assembly to the extent that the said Act applies to use of vessels on waterways falling under item 36 of the exclusive Legislative list and 2nd Schedule of the National Inland Waterways Authority Act.
The company is also urging the court to declare that the Marine vesseI used levy charged by the Akwa Ibom State Government and Internal Revenue Service amounts to double taxation in the light of the levies paid by the plaintiff, Homeland Integrated Offshore Services Limited to the Federal Inland Revenue Service, Nigeria Marine Administration and Safety Agency and National Inland Waterways Authority.
Joined as respondents in the ensuing legal battle are the Attorney General and Commissioner for Justice Akwa Ibom State, Speaker, Akwa Ibom State House of Assembly, Akwa Ibom Internal Revenue Service, Attorney General and Minister of Justice, The National Assembly, Federal Inland Revenue Service, Nigeria Maritime Administration and Safety Agency, National Inland Waterways Authority and Multi Capital Resources Limited.
According to the affidavit sworn to by an associate in the employment of Lexavier Partners and filed before the court by Dr Francis Chuka Agbu, SAN, the deponent averred that the plaintiff, Homeland Integrated Offshore Services Limited Company, received letters dated August 30, 2021, October 11, 2021 and November 5, 2021 respectively, from the Akwa Ibom Internal Revenue Service and Multi Capital Resources Limited, demanding the payment of a Marine Vessel Use Levy which was imposed by the Akwa Ibom Internal Revenue Service pursuant to a law, titled Akwa Ibom State Maritime Sector (Regulation Law) 2017, which was enacted by the Speaker, Akwa Ibom State House of Assembly.
The said levy was purportedly in respect of vessels owned and operated by the plaintiff on waterways in Akwa Ibom State.
By the said letters, the Multi Capital and Akwa Ibom Internal Revenue Service also threatened to disrupt the plaintiff’s business upon failure to pay the said levy.
Prior to the receipt of the letters, the plaintiff has been paying relevant taxes, charges and levies on accounts of its operations on the same waterways to the Federal Government through the Federal Inland revenue service, Nigerian Maritime Administration and safety Agency NIMASA.
The said taxes, charges and levies are imposed and paid pursuant to several statutes enacted by the National Assembly, including but not limited to the Nigerian Maritime Administration and Safety Agency Act 2007 (“NIMASA Act”); the National Inland Waterways Authority Act 1997 (“NIWA Act”‘), the Coastal and Inland Shipping (Cabotage) Act 2003 (“Cabotage Act”), among others.
The said charges are levied on/for the use/ operation of vessels on all waterways within Nigeria. The said charge is enforced and collected by NIMASA on the premise that it is the appropriate authority vested with the powers to assess, administer and collect the same.
In the action before the court, the plaintiff was said to have been taken aback when it received letters from the Akwa Ibom Internal Revenue Service and Multi Capital Resources Limited in respect of the same incidence of tax (that is for the use of marine vessels) and for the same periods over which the plaintiff has religiously remitted payments to the Federal Inland Revenue Service, NIMASA and National Inland Waterways Authority, between 2019 and 2021).
It was further revealed that the plaintiff immediately instructed its solicitors to obtain a copy of the said Akwa Ibom State Maritime Sector (Regulation Law) 2017.
A look at the law shows that the referenced law is purportedly for the regulation of maritime activities within Akwa Ibom State.
The demand by the Akwa Ibom Internal Revenue Service and Multi Capital Resources Limited has however placed the plaintiff under the risk of double taxation. The plaintiff is also under an imminent threat by the Akwa Ibom Internal Revenue Service and Multi Capital Resources Limited to disrupt its business operations.
In order to avoid the risk of double/multiple taxation on the same matter and in view of the risk of obstruction of its operations by the Defendants (as threatened in their letters), it has become expedient to approach the court for the interpretation of the relevant provisions of the Constitution and the said Law, vis-Ã -vis the legislative competences of the Speaker, Akwa Ibom State House of Assembly and the National Assembly.
Prior to the letter of demand to the company, Akwa Ibom State Government had through a bill sponsored by a member of the House of Representatives sponsored a Bill to the National Assembly, seeking to enable State Governments to make laws to regulate Nigerian Waterways by removing the said item from the Exclusive Legislative List into the Concurrent Legislative List. The said Bill was rejected by the National Assembly in July 2021.
Despite being aware of the Constitutional position on the limit of its powers, the Akwa Ibom State Government has allegedly continued, through the agency of the Akwa Ibom Internal Revenue Service and Multi Capital Resources Limited, to exercise powers which it knows are outside its remit and has continued to threaten the plaintiff’s business.
However, in a counter affidavit sworn to by the legal officer of the Akwa Ibom Internal Revenue Service, Mfon Udoma, he stated that Akwa Ibom State is one of the littoral States in Nigeria and has a coastal boundary, and as a fact that there is a demarcation between International Waterways, Federal Government Waterways and State Government Waterways Akwa Ibom State, like other coastal states, controls and derives revenue therefrom from State Government Waterways within the boundaries of Akwa Ibom State.
Akwa Ibom State Maritime Sector (Regulation Law) 2017, does not operate or apply at the International Waterway or at the Federal Government Waterways.
The demand notice served on the applicant arose from her usage of marine vesseI within Akwa Ibom State Waterways.
The said levy was not based on levies imposed by the Nigerian Maritime Administration and Safety Agency or NIMASA Act, nor based on the levies imposed by the National Inland Waterways Authority or the Law establishing same, neither does the levy based on Cabotage Act or any Federal Government Law, but it was rather based on the acts of the Applicant within 200 meters Isobaths in the Akwa Ibom’s waterways.
The applicant is said to be evading payment of the levies arising from his operation on the Akwa Ibom State Waterways and has brought the suit as a ploy to delay the payment of levies arising from his activities within the Akwa Ibom’s State Waterways.
The case has been adjourned till after court vacation for hearing.
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