The Tax Appeal Tribunal (TAT) sitting in Lagos has ordered Multichoice Nigeria Limited, DSTV, to pay 50 per cent of N1.8 trillion which the Federal Inland Revenue Service (FIRS) had determined through a forensic audit to be the amount in taxes that Multichoice Nigeria Limited had failed to pay to the federal government in past assessment years.
Fifty per cent of the backlog is N900 billion.
The five-member TAT led by its Chairman, Prof. A.B. Ahmed, issued the order following an application to it by the counsel to FIRS.
The FIRS Counsel made the application under Order XI of the TAT Procedure Rules 2010 which enables a party to make an application at any stage of the proceedings.
Counsel for FIRS drew the attention of the Tribunal to Paragraph 15(7) of the Fifth Schedule to the Federal Inland Revenue Service (Establishment) Act 2007 and urge the tribunal to direct Multichoice to deposit with the FIRS 50 per cent of the amount of the assessment under appeal as security and a condition that must be fulfilled before the prosecution of the appeal brought before the tribunal.
The details of the development was contained in a statement issued Wednesday by Director, Communications and Liaison Department, FIRS, Dr. Abdullahi Ismaila Ahmad.
In certain defined circumstances to which the Multichoice appeal fits, Paragraph 15(7) of the Fifth Schedule to the Federal Inland Revenue Service (Establishment) Act 2007 (FIRS Act) requires persons or companies seeking to contest a tax assessment to pay all or a stipulated percentage of the tax assessed before they can be allowed to argue their appeal contesting the assessment at TAT, the statement added.
Multichoice had filed the matter at the Lagos TAT following its dispute over FIRS’ issuance of Notices of Assessment and Demand Note in the sum of N1.82 trillion on 7 April 7, 2021.
The amount constitutes what the FIRS calculated as due in taxation to the federal government from the company after an investigation over several months to determine the extent to which Multichoice had been evading taxes in Nigeria.
According to the statement, at the Tuesday’s hearing of the matter in Appeal No: TAT/LZ/CIT/062/2021 19/08/2021 (Multichoice Nigeria Limited v. Federal Inland Revenue Service), Multichoice had amended its Notice of Appeal and thereafter sought through its counsel, Bidemi Olumide of AO2 Law Firm for an adjournment of the proceedings to enable it to respond to the FIRS’ formal application for accelerated hearing of the appeal and prayer before the TAT directing Multichoice to produce before the tribunal the integrated annual report and Management Account Statements of Multichoice Group Ltd for Tax Years 2012 to 2020., among other prayers.
In response, however, the FIRS counsel asked TAT to issue an order requiring that Multichoice makes the statutory deposit of 50 per cent of the disputed sum.
After hearing arguments from both sides, TAT upheld the FIRS submission and directed Multichoice to deposit with the FIRS an amount equals 50 percent of the Assessment under the Appeal plus a sum equal to 10 per cent of the said deposit as a condition precedent for further hearing of the appeal.
Thereafter, TAT adjourned the appeal to September 23, 2021 for report of compliance with its order and continuation of the hearing, subject to compliance with the tribunal’s order.
