Rivers Wins As Court Stops FG’s Deduction From Federation Account To Fund Police

A Federal High Court in Abuja has stopped the federal government from further making deductions from the federation account to fund its own agencies not listed for direct allocation in the 1999 constitution (as amended).

Justice Ahmed Mohammed held that Section 4(1)(a) & (b) of the NPTF Act 2019, requiring the deduction of 0.05 per cent of any funds in the Federation Account and 0.005 per cent of the net profit of companies operating in Nigeria to fund the police are unconstitutional.

The Judge ordered the Federal Government to refund to Rivers State its share of the funds deducted from the Federation Account since deductions began in accordance with provisions of the NPTF Act.

He gave the ruling in a suit filed by Rivers State government against the Attorney-General of the Federation (AGF), Accountant-General of the Federation (AG-F), Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC) and the Minister of Finance.

Justice Mohammed said the provisions were inconsistent with Section 162(1) & (3) of the Constitution, requiring the payment of total revenue collected by the government of the federation, including levies and taxes, into the Federation Account for sharing among the three tiers of government.

The judge agreed with Rivers State that, by virtue of Section 162 (3) of the Nigerian Constitution, funds standing to the credit of the Federation Account “can only be distributed among the federal, state and local governments in each state of Nigeria and not directly to any agency of the federal government, including the NPF.”

He added that no other entity, by the provision of Section 162(3) of the Constitution, outside the three tiers of government is entitle to partake in the sharing of funds standing to the credit of the Federation Account.

The judge held that to that extent, Section 43(1) a and b are inconsistent with the provision of Section 162(3) of the Constitution.

He further held that the duty to establish and maintain the Nigeria Police Force is that of the FG, the police being an agency of the Federal Government

The judge ordered the Fed Government to refund to the Rivers State Government its share of the funds from the Federation Account that have been wrongly deducted since the commencement of the deduction in accordance with the provisions of the NPTF Act.

Justice Mohammed granted reliefs 1, 2, 3, 4, 5 and 7 as prayed by the plaintiff, and in respect of reliefs 6 and 8 the relate to refund, the judge said they should apply to Rivers States.

The judge was of the view that since the case was filed only by Rivers State and not on behalf of itself and the other 35 states, the court could not make orders in favour of parties not before it.

KanyiDaily recalls that Rivers State Governor, Nyesom Wike had also dragged the Federal Inland Revenue Service (FIRS) to the Supreme Court over the collection of Value Added Tax (VAT).