Abuja: The Court of Appeal in Abuja has reversed a Federal High Court (FHC) decision that had ordered the Central Bank of Nigeria (CBN) to pay Kasmal International Services N579 billion in connection with stamp duty collection.
According to News Agency of Nigeria, the initial ruling by Justice Inyang Ekwo on October 11, 2024, mandated the apex bank to pay an additional N579,130,698,440 to Kasmal, along with a 10 percent annual interest rate on the judgment sum from January 1, 2015, to January 31, 2020. Justice Ekwo’s judgment had also established that the CBN had already paid Kasmal a total of N10.3 billion, representing 15 percent of remitted stamp duties by all Deposit Money Banks (DMBs) during the specified period.
Justice Adebukola Banjoko, delivering the majority judgment in the appeal, agreed with the CBN’s argument that Kasmal had no legal right to have been engaged by the Nigerian Postal Service (NIPOST). The appellate court concluded that Kasmal lacked the legal authority to initiate the suit or claim any commission, declaring the suit “fundamentally defective.”
Kasmal’s legal representative, Alex Izinyon, SAN, had argued that the company was appointed by NIPOST to collect a N50 charge on receipts issued by banks for electronic transfers and teller deposits of N1,000 and above, in compliance with the Stamp Duties Act and Nigerian Financial Regulations 2009.
The CBN and Attorney General of the Federation (AGF), dissatisfied with the FHC ruling, listed 17 reasons in their notice of appeal, contending that the lower court erred in law. The appellants emphasized that the funds Kasmal sought were public monies, part of the Federation Account, and should be shared among the three tiers of government.
Delivering judgment in a 2/1 ratio, Justice Banjoko highlighted that there was no legal contract between Kasmal and NIPOST from the beginning. She also noted that NIPOST lacked the statutory authority to manage or collect stamp duties, and therefore, could not delegate such powers to Kasmal.
However, in a dissenting judgment, Justice Okon Abang disagreed with the majority, arguing that the transaction was ratified by the AGF and that the CBN’s appeal lacked merit. He stated the doctrine of unjust enrichment should prevent the CBN from retaining benefits without compensation to Kasmal.
The News Agency of Nigeria reports that stamp duty is an indirect tax imposed on several financial transactions. In 2023, former CBN Governor Godwin Emefiele disclosed that total revenue collected as stamp duty from 2016 to 2022 amounted to N370.686 billion. Kasmal had approached the FHC to determine its share under its agreement with relevant agencies, particularly NIPOST.
