A Cross River State High Court sitting in Calabar, has nullified some sections of the Cross River State Tourism Development Levy Law which was enacted during the administration of former governor, Donald Duke.
The Court also awarded the sum of N500,000 to Mr. Biggs against the Cross River State government over the closure of the fast food company by the state government in 2007.
In suit No. HC /229/2019, between U.A.C of Nigeria Plc (Trading under the name of UAC Restaurants – (Mr Biggs ) and five others; Government of Cross River State, Cross River State Board Of Internal Revenue, Attorney General/ Commissioner for Justice, Attorney General of the Federation and Federal Inland Revenue Service who are the 1st, ,2nd, 3rd ,4th and 5th Defendants, the Plaintiff/Claimant had prayed the Court to declare that matters involving taxation of incomes, profits and Value Added Taxes are matters under the Exclusive Legislative List in Part 1 of the Second Schedule to the Constitution of Nigeria, 2004 and beyond the power of the Government of Cross River State to make such laws.
The Plaintiff also urged the Court to make four Orders namely;
“that Cross River State Tourism Development Levy Law No 20 of 2007 and Amendment Law No 5, 2008 as enacted by the House of Assembly imposing obligations of levying, taxing and collection of the said levies and taxes on the Plaintiff, amounts to double taxation and therefore prejudicial to the rights and interests of the Plaintiff and it’s teeming consumers in the state.
“Order compelling the 1st, 2nd and 3rd Defendants to refund the sum of N1, 600, 000.00 paid to it by the Plaintiff in protest to forestall distrainment of the Plaintiff’s charttels and the closure of it’s premises within the state for its failure within the time stipulated to comply with the aforesaid Law of Cross River State.
“Order perpetual injunction restraining the 1st and 2nd Defendants by themselves , agents, officers , servants and privies from harassing, intimidating the Plaintiff and its staffers in its restaurants and or distraining , sealing and closing down it’s operations anywhere within Calabar or by any means coercing the Plaintiff to commence the collection and remittance of the said Tourism Development Levy from it’s customers anywhere within the state including order Costs of this Action”.
The court in its judgment made Order that Section 2 of the Cross River State Tourism Development Levy ( Amendment ) Law No 5 of 2008 is null, void and set it aside as it purports to usurp the powers conferred upon the National Assembly under section 4 (1), (2), (3), (4), by both the Exclusive and Concurrent Legislative Lists Part 1and 2 of the Second Schedule to the 1999 Constitution ( as amended).
The court also set aside Sections 2 and 4 (1) of the state Tourism Development Levy Law (amended ) and made order for the 1st to 3rd defendants to refund the sum of N1, 600,000.00 which the Plaintiff/Claimant paid in protest to forestall distrainment of its goods and chattels and closure of its premises anywhere in the state.
The court granted the perpetual injunction canvassed by the Plaintiff against the 1-3 defendants, their agents, officers, servants or privies from harassing and intimidating the Plaintiff/Claimant or it’s officers, servants in its restaurant or trespassing upon its properties and premises including closing down its operations in the state.
Assessing the costs of this Action in the sum of N500,000.00 only against the 1- 3 Defendants in favour of the Claimant, Justice Abua freed the 4th and 5th Defendants of any liability in this action.
Counsel for the U.A.C Of Nigeria Plc, Chief Tolani Musa lauded the judgement of the Court.
Musa, an Aba based legal practitioner, said he was overwhelmed by the court’s verdict which he described “as well resounded and researched”.
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