30th October, 2019
Federal Inland Revenue Service (FIRS) and First Bank Plc have opted for out of court settlement in an N25 billion damages suit filed against them by an indigenous company, Biatemp Ventures Ltd over alleged account manipulation.
The company had sued First Bank and FIRS before a Federal High Court, Abuja, demanding N25 billion special and general damages over alleged manipulation of its domiciliary account and illegal withholding of its tax clearance certificate.
Biantemp alleged that First Bank manipulated its domiciliary account with an over-bloated turnover of over 6.8 million dollars (about N2.4 billion) whereas the deposit made to the account within the period was only 22,475 dollar (about N786,000)
At the resumed hearing of the case before Justice Binta Murtala Nyako, lawyers to the two defendants informed the court that their clients were interested in settling the matter out of court.
Messrs S.M. Jimmy and N.J. Kalu representing First Bank and FIRS respectively prayed the court to adjourn the matter to allow parties to further explore the out of court settlement already set in motion.
Counsel to the plaintiff, Lloyd Ekweremadu from Adegboyega Awomolo (SAN) Chamber confirmed the position and did not oppose the request for adjournment.
Ekweremadu said that, though the case was set for the hearing of the motion of the 2nd Respondent’s to amend its Statement of Defence, he would not oppose the request for adjournment of the case. He confirmed that the respondents had approached his client seeking to settle the case out of court.
Justice Nyako expressed delight over the development stressing that the court always encourage parties in disputes to explore alternative resolution options.
The matter was then adjourned till Dec. 2 for the Report of Settlement.
The plaintiff had alleged in the suit that the manipulation of the account was discovered by the FIRS intelligent findings when it filed it’s 2018 tax return forms and awaiting issuance if its tax clearance certificate.
The plaintiff stated that, rather than issuing the certificate, FIRS accused the company of grossly understating its income.
Specifically, the federal revenue collection agency said its intelligent unit discovered that the company had a turnover of over 6.8 million dollars in its corporate account which was withdrawn by its Chief Executive Officer in about four respective transactions.
FIRS, therefore, requested the company to pay a revised tax liability of about 439,000 dollars before the tax clearance could be issued.
The plaintiff said it was shocked with the discovery by the FIRS because the company never transacted, deposited and withdrew the amount of that magnitude in its domiciliary account within the period.
The company said the deposit made to its domiciliary account within the period was only 22,475 dollars being a consultancy fee paid by its client, Forte Upstream Services Ltd. It stated that the said deposit of 22,475 dollars was withdrawn by its Chief Executive Officer in about four respective transactions.
The plaintiff, therefore, alleged that the acclaimed deposit of over 6.8 million dollars discovered by the FIRS intelligence was an enlarged mirror of the 22,475 dollars deposited by its client for consultancy services into its account.
“The alleged huge multiple cash dollar withdrawal seen to be made by the plaintiff’s Director between 7th and 21st December 2017 as captured by the FIRS were also enlarged mirrors of actual dollar withdrawals made by the plaintiff’s director”
The plaintiff said when it obtained its statement of account from First Bank the inflow and outflow of the fund were in complete variance with the record made available by the FIRS.
In a statement of defence to the suit, FIRS had indicted First Bank claiming that it received from First Bank PLC, the purported over-bloated turnover of the account of the plaintiff
Specifically, FIRS said that it received from First Bank a compact disc containing evidence that the company received a cash flow of over 6.8 million dollars. The federal revenue collection agency said it acted based on the information provided by the bank.
First Bank, on its part, had denied the allegations that it manipulated the account of the plaintiff.
In a statement of defence, the bank claimed: “The plaintiff’s account was never at any point in time tampered with, let alone manipulated. There is no time that First Bank, as a well known and reputable bank in Nigeria engage in such irresponsible and scandalous act,” the bank had stated.