Void Assessments to Income Tax in Nigeria

Many Nigerian decisions in tax cases have firmly established the possibility of raising the defence of lack of jurisdiction in the assessment in an action for recovery of tax. This development has resulted from decisions of the courts and has led to a significant shift from the practice in the U.K. There— aside from the possibility of applying in rather exceptional cases for judicial review—the consideration of any issues, whether of fact or of law, as to the merits of an assessment is confined to appeals before the Commissioners with further appeal to the High Court on points of law. This apparently technical difference has had great practical importance. Recourse to the courts for the purpose of tax recovery has become more difficult for the Revenue and this has encouraged the development of extra-judicial methods of tax collection.A study of those Nigerian decisions that have established, extended and applied this doctrine, and of its consequences, should be of interest in other anglophone African countries. The income tax statutes of many such countries are basically similar due to their common descent from a “Model Ordinance” prepared in the U.K. in 1922. Decisions of the Nigerian Courts on the construction of provisions of the Nigerian tax statutes are of persuasive authority in other Commonwealth countries with similar provisions in their own tax enactments.This paper first provides a broad outline of the Nigerian legislation on tax assessments, appeals and collection in order to facilitate the understanding of the points discussed later.