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Court strikes out suit against CBN on stamp duty collection

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A federal High Court, Lagos, has struck out a suit against the Governor of Central Bank of Nigeria (CBN) challenging its circular of January 15, 2016 directing and authorising all Deposit Money Banks (DMBs) and other financial institutions to enforce collection of ₦50 stamp duty on electronic transfers and teller deposits from ₦1,000 and above.

In the suit commenced on February 9, 2017, the applicants, the Incorporated Trustees of Laws and Rights Awareness Initiative & Mr. Victor Adeyon, had prayed the court for an order of mandamus to compel the governor of the CBN to issue another circular redirecting DMBs to stop deducting and remitting ₦50 as stamp duty on eligible banking transactions.

The applicants through a motion filed by their counsel, Olumide Babalola, sought inter-alia for a declaration that by virtue of the decision in CA/L/437A/2014 Standard Chartered Bank v Kasmal International Services Ltd (Appeal No: SC/524/2016) delivered on April 21, 2016, the respondent ought to have issued another circular directing banks to stop deducting and remitting stamp duties from cash deposits and/or electronic transfers over ₦1,000.

But counsel to the respondent, Prof. Fabian Ajogwu (SAN), had in opposition challenged the legality of the remedy being sought by the applicants. Ajogwu, leading others, who stated that the court was not vested with the jurisdiction to entertain the matter as the claim is statute barred, contended that the judgment, which the applicants sought to enforce is the subject of an appeal at the Supreme Court.

The trial judge, Justice Chuka Austine Obiozor, in his judgment delivered on Thursday, May 30, 2019 but obtained at the weekend, held that the applicants had failed to prove that they were entitled to an order of mandamus compelling the respondent to issue another circular directing deposit money banks to stop deducting and remitting stamp duties from cash deposits and/or electronic transfers.

Obiozor ruled that the suit had been overtaken by event by virtue of a prior Federal High Court decision on the same subject matter in suit No FHC/L/CS/126/2016 – Retail Supermarkets Nigeria Limited V. Citibank Nigeria Limited & Central Bank of Nigeria.The court, therefore, said that since there was a subsisting judgment in respect of the same subject matter, it was unnecessary to grant the reliefs sought by the applicants and consequently struck out the suit.


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CBNVictor Adeyon
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