N579bln Judgment Set Aside: CBN, NIPOST Win Appeal Court Case

The Court of Appeal in Abuja on Wednesday overturned a Federal High Court judgment that had directed the Central Bank of Nigeria (CBN) to pay Kasmal International Services N579,130,698,440 (billions) for its role in stamp duty collection.

In the lead judgment, Justice Adebukola Banjoko ruled that Kasmal lacked the legal standing (locus standi) to be initially engaged by the Nigerian Postal Service (NIPOST) for stamp duty collection.

Justice Banjoko emphasized that Kasmal did not possess the necessary legal authority to initiate the lawsuit or claim any rightful entitlement or commission.

She added that the suit as constituted is fundamentally defective, ruling “Similarly, you cannot give what you don’t have.”

The Appeal Court noted that NIPOST had no statutory authority to manage or collect stamp duties and cannot delegate powers it does not have to Kasmal.

Banjoko reiterated that the Federal High Court erred in declaring Kasmal’s entitlement to the said commission when there was no legal contract between Kasmal and NIPOST from the beginning.

Persecondnews recalls that the dispute revolved around the collection of stamp duty, an indirect tax levied on various financial transactions.

Kasmal had initially approached the Federal High Court to ascertain its agreed percentage share under its arrangement with the NIPOST.

Conversely, the CBN and the Attorney General of the Federation (AGF) argued that the funds Kasmal sought were public monies.

They contended that these funds are part of the Federation Account, which is governed by the provisions of Section 162 of the 1999 Constitution (as amended), implying they should be distributed among the three tiers of government.

The Appeal Court’s decision has significant implications for the financial sector.

The court’s emphasis on statutory authority and contractual agreements highlights the need for clear guidelines and regulations in the financial industry.

Banjoko said: “The suit as constituted is fundamentally defective.” She also emphasized that “you cannot give what you don’t have.”

She pointed out that the Federal High Court, per Justice Ekwo, “erred in declaring Kasmal’s entitlement to the said commission when in law there was no legal contract ab initio (from the beginning) between first respondent (Kasmal) and NIPOST.”

The court ruled that Kasmal’s engagement by NIPOST was without legal authority, and therefore, the claim for commission is without basis.