N50 Stamp Duty: Appeal Court Fixes April 7 To Hear 22 Banks' case Again Senator Kashamu's Firm

N50 Stamp Duty: Appeal Court Fixes April 7 To Hear 22 Banks' case Again Senator Kashamu's Firm

The Lagos Division of the Court of appeal yesterday fixed April 7 for the commencement of hear in a suit jointly filed by 22 commercial banks in Nigerian, challenging a judgement of a Federal High Court compelling them to remit to Nigerian Postal Services through KASMAL International Services limited a sum of N50 as stamp duty on every transaction from N1, 000 and above.

The  special panel constituted by the President of Court of Appeal, Justice Zainab Bulkachuwa and presided over by Justice Ibrahim Saulawa, which fixed the date yesterday, also ordered that hearing notices should be served on all parties in the matter.

The banks are contesting the legality of KASMAL International Services limited, a company owned by a Peoples Democratic Party (PDP) chieftain, Senator Buruji Kashamu, to collect stamp duty on behalf of the government. 

KASMAL International Services had in a 32-paragraph affidavit deposed to by Senator Kashamu, urged the lower court among others reliefs to ordered the banks to give effect to the Agency Agreement between it and the Nigerian Postal Services (23rd defendant) as well as the Cooperate Agreement between it and the School of Banking Honours (24th defendants) respectively.

The banks are, Access bank Pls, Citibank Nigeria Limited, Diamond Bank Plc, ECO bank Plc, Enterprise bank Plc, Fidelity, First bank Nigeria Plc, First Monument bank Plc, First Inland bank Plc, Heritage banking company limited, Mainstreet banking limited, Sye bank Plc, Stanbic IBTC bank limited, Standard Chartered bank Plc, Sterling bank Plc, Union bank Plc, United Bank of Nigeria Plc, Unity bank Plc, WEMA bank Plc, Unity bank Plc, Zenith bank Plc respectively.

Justice Aneke had in his judgement declared that upon a community reading and the construction of the provisions of the Stamp Duties Act 2004, NIPOST Act 2004 and the Federal Government of Nigeria Financial Regulations 2009, the 22 banks are obliged to deduct and remit to NIPOST (23 defendant) through the plaintiff a sum of N50 as stamp duty on all receipts by electronic transfer or teller deposit of monies from N1000 upward made into accounts operated in all their branches.

Apparently dissatisfied with the judgment, the bank in their separate notices of appeal urged the appellate court to allow the appeal and set aside the judgement of the lower court.

The appellants submitted  that the lower court erred in law when it held that KASMAL International Services limited’s suit was properly commenced by originating summons.

They argued through their respective lawyers that the lower court judge erred in law when he held that the respondent had the locus standi to institute the suit for the recovery of stamp duties.

They also faulted the decision of the lower court when it held that the banks transactions relating to electronic funds transfer on held of its customers and teller deposits of funds by its customers can be described as receipts within the provisions of Section 89 of the Stamp Duties Act.

According to them, the learned trial judge erred in law and misdirected himself when he granted the reliefs sought by the plaintiff and ordered the appellants (banks) are liable to deduct and remit the sum of N50 as Stamp Duties and electronic transfers on amounts equaling or in excess of N1, 000 in all the banks’ branches and also pay the penalty of N20 to the plaintiff.

They further argued that the law says is to attach adhesive stamps ad-valorem on assessed documents and not to remit any money whatsoever to the Nigerian Postal services Contrary to the verdict of the lower court, the appellants stated that only the President and the governor of a State have the power to make regulations concerning the Stamp Duty Act in carrying into effect the objects and purposes of the Stamp Duty Act.

The bank also insisted that the lower court misdirected itself in holding that the plaintiff/respondent who has no privy of contract with the banks has succeeded in establishing a cause of action for breach of contract notwithstanding the Plaintiff do not have locus standi to sue the appellants.