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Dangote Vs Ibeto cement waiver suit adjourned till November 1

A Federal High Court, sitting in Lagos, yesterday adjourned a suit filed by Dangote Cement Plc against Ibeto Cement Company till November 1, 2016 pending the decision of the Court of Appeal on the matter.

In the suit, while Dangote Cement is alleging that Ibeto Cement is enjoying undue advantage by evading taxes, Federal Government is contending that Dangote Cement Plc is trying to wipe out fair competition and level playing field and create monopoly of the cement industry.

Details gotten at the hearing show that other defendants in the suit include IBG Investments Limited, Derima Venture Limited, Federal Republicof Nigeria, Attorney General of the Federation, Federal Ministry of Finance, Federal Ministry of Trade and Investment, Board of Customs and Excise, Federal Inland Revenue Services, and Nigerian Port Authority.

In its prayers, Dangote Cement Plc, through its lawyer and a Senior Advocate of Nigeria (SAN), Oluwakemi Balogun, is praying amongst other things a declaration of the court that the President and Commander-in-Chief of the Armed Forces of the Federal Republic of Nigeria, lacks the power to waive, alter or revise the provisions of the Value Added Tax Act, Cap. V1, Laws of the Federation, 2004, without the legislative approval of the National Assembly.

It also seeks an order of perpetual injunction against the three defendants from importing into Nigeria any quality of bulk or bagged cement except as newly approved by the appropriate authority under the current fiscal tax policy stipulation in force.

Earlier in an affidavit sworn to by one Ekanen Etim, principal officer of Dangote Cement Plc, it was alleged that in 2002, the Federal Government formulated the backward integration policy whereby quota for importation of cement was to be allocated based on proven investment by operators in the industry, a qualification, which Dangote Cement alleged Ibeto and two other defendants in this suit never had. The case had lingered for long.

It would be recalled that at the inception of a new administration in July 2007, Ibeto applied for import allocation, falsely claiming to have satisfied the modalities. It was granted allocation of 1.5million metric tons of cement per annum to be at 5 per cent import duty and tax free under the backward integration.

Within the period under review, Dangote Cement also petitioned the then President Alhaji Musa Yar’Adua, about the unfair advantage. The President then directed all cement importers to operate under the same concessions.

But it was alleged also that barely four days after the fiscal policy was issued, Ibeto pre-emptily sought a restraining order from the court and deliberately and fraudulently suppressed the fiscal policy regime of 2008, 2009, and, 2010.

Again, Ibeto further filed terms of settlement which was entered as consent judgement in the suit, but deliberately suppressed the fiscal policy.

However, by the said judgement, Federal Government was to pay Ibeto $40m and N1.9bn, being the verified claims by the inter-ministerial committee for losses suffered by Ibeto from the unjustified closure of its bagging plant in December, 2005.