2 companies sue FIRS over N2.4m additional tax charges

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Abuja  –  Two companies filed an appeal against the Federal Inland Revenue Service (FIRS) before the Tax Appeal Tribunal seeking an order to quash the additional income tax assessment of N20.4million slammed on them.

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The companies are Systems Applications Products Nigeria Ltd and Systems Applications Products South Africa (PTY) Ltd.

The assessment was for the year 2012.

Of the three grounds of appeal filed before the Tax Appeal Tribunal Abuja, the appellants averred that the first appellant was a body established under the laws of the Federal Republic of Nigeria.

That it is distinct from the second appellant which is a body established under the laws of Republic of South Africa and the first appellant cannot be held accountable for the income taxes of the second appellant.

Also, the appellants contend that the grounds upon which the respondent relied to reach its decision to impose the additional tax liabilities were not stated in the assessments nor communicated to the appellants.

The reliefs they sought from the tribunal, therefore, were an order declaring the imposition of the sum of N20, 402, 379.00 by the respondent on the first appellant as unreasonable, arbitrary and a violation of right.

Also a declaration that the imposition is not in line with Section 30(1) b of the Companies Income Tax Act (CITA) and an order quashing the additional assessment served on it.

Replying, the respondent, FIRS, said it did not err in law when it issued and served notice of additional assessment on the first appellant on behalf of the second appellant.
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Furthermore, the first appellant is held accountable for the income taxes of the second appellant since the first appellant is its subsidiary and serves as its agent.

The respondent therefore prayed the tribunal to declare the said additional tax assessment issued to the appellant as valid and in accordance with CITA.

In addition, the respondent seeks a further order, upholding the assessment and directing the immediate payment of the sum.

On Wednesday, counsel to the respondent, Mary Okpe (Ms), orally applied for the extension of time within which to file and serve the respondent’s reply and to deem so as having been properly served.

Mr Samuel Ibrahim, counsel to the appellants did not object.

Subsequently, the tribunal presided over by Hon. Nnamdi Ibegbu (SAN),
granted the application for the extension of time for the respondent to file and serve the processes properly.

He then adjourned till Dec.1 for hearing. (NAN)


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