Section 41(8) of NTAA stipulates that where a taxpayer is dissatisfied with the judgment of Tax Appeal Tribunal (TAT) he/she may appeal to the high court provided he/she pays 20% of the disputed tax liability and include the evidence of payment when filling the notice of appeal.
Recall that TAT rule in 2021 and that of the Chief Judge of the FHC practice direction requirement to Pay 50% of Assessment Tax. It was a requirement that where a taxpayer intends to challenge an assessment served on him by the FIRS, the taxpayer shall pay half(50%) of the assessed amount in an interest yielding account of the FHC, pending the determination of the application.
However, In 2023 Justice Omotosho of the FHC declared the practice direction,provisions of Order V Rule 1 of the Federal High Court of Nigeria (Tax Appeals) Rules, 2022 as “unconstitutional, null and void and of no consequence having regard to the provisions of Sections 251(1), 6(6) (a) & (b), 36(1) & (2) of the 1999 Constitution (as amended).
The court ultimately declared unconstitutional, null and void, and of no effect, the relevant provisions of the TAT Rules, FHC Practice Directions, FHC Rules, and paragraph 15(7)(c) of the Fifth Schedule to the FIRS Act, which provide in one way or the other for the payment of 50% or a percentage or the total amount.
Does Section 41(8) of the NTAA conflict with Section 36(1) and (2) of the Nigerian Constitution? It is important for taxpayers to be aware of this provision.
Dr Kennedy Iwundu
Source: BarristerNG
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