Tribunal Orders NLNG To Pay FIRS Over $27m

The Tax Appeal Tribunal has ordered Nigeria Liquefied Natural Gas Limited to pay the Federal Inland Revenue Service the sum of $27.5m as a full and final settlement of the revised Companies Income Tax for the 2016 assessment year.

According to the News Agency of Nigeria on Tuesday, this was part of the judgment of the five-member Tax Appeal Tribunal chaired by Mrs Alice Iriogbe, sitting in Abuja.

The judgment was entered in the terms of settlement agreed to by the parties in the appeal.

The NLNG Limited had sued the FIRS, praying the tribunal to restrain the revenue agency from collecting $141.75m from it as CIT for the year under review.

It challenged the FIRS’ notice of additional assessment dated December 15, 2021, and the Notice of Refusal to Amend dated March 22, 2022.

NLNG appealed the matter in a suit marked TAT/ABJ/APP/331/2022, which was filed on April 21, 2022.

Delivering the judgement, the tribunal observed that the parties had engaged in a process of settlement even when the trial was ongoing in the matter.

The TAT, in the certified true copy of the judgement, which was delivered on Thursday and made available to NAN on Tuesday, said, “On the 10th July 2024, parties filed a term of settlement in the tribunal.”

The panel held that in the terms of settlement signed by parties, the NLNG agreed to pay FIRS “the sum of $27.50m as full and final settlement of the Revised CIT Assessment and the subject matter of this appeal if payment is made on or before Friday, 12th July 2024”.

“In furtherance of the above the appellant (NLNG) on Monday 8th July 2024, duly remitted the said sum of $27. 50m to the respondent (FIRS), being the full and final settlement amount agreed upon by the parties. In this circumstance, the terms contained in the terms of settlement have been adopted and made the judgment of this honourable tribunal. This is the judgment of this Honourable Tribunal.”

Earlier, in a ruling, the tax panel dismissed the NLNG’s interlocutory motion seeking to disqualify the tribunal from further sitting because the company did not have confidence in the tribunal to adjudicate on the matter.

In the motion, the company asked the tribunal to direct the chairperson, Iriogbe, and another member, Mr Ajayi Bamidele, who were former staff of FIRS before retirement, to recuse themselves from further participation in the hearing of the matter as their presence in the panel posed likelihood of bias against the applicant.

The plea was rejected by the tribunal, saying it could not see any cogent reason for it.

It agreed with the FIRS lawyer’s argument citing Section 59 of the FIRS Establishment Act 2007 (as amended) and Paragraph 8 of the fifth schedule of the same Act.

“The appellant (NLNG) counsel also said that he did not have any reason to suspect that the panel would be biased but that other people might have a contrary view.

“However, given the statutory provisions quoted above, the only option probably open to the applicant would be to seek to invalidate the statutory provisions in a superior court of law. Given the foregoing, this tribunal sees this application as being frivolous and it is hereby dismissed with no order as to cost,” the TAT ruled.