Delta State Revenue Court Is Competent To Entertain Cases On Tenement — Court of Appeal

A Court of Appeal Sitting in Asaba, Delta State has decided in favour of Ethiope Local Government Area of the State in its appeal against a decision of the Delta State High Court which earlier held that the State Revenue Court lacks the jurisdiction to determine to Appellant’s case against the Respondent (Pan Ocean Oil Corporation) for the latter’s refusal and failure to pay tenement assessment rate for the year 2013.

The case commenced in 2013 when the Appellant had served the Respondent with a demand Notice for the payment of tenement rate assessed in the sum of N15, 100, 950 (Fifteen Million, One Hundred Thousand, Nine Hundred and Fifty Naira) for the said year. The Respondent refused to comply with the demand notice, hence the Appellant instituted the suit at the Revenue Court of Delta State on the 5th day of March, 2013.

Upon the hearing of the evidence of two witnesses called by the Plaintiff/Appellant and one witness called by the Defendant/Respondent, the trial Revenue Court entered judgment for the Appellant validating the tenement assessment demanded from the Respondent.

Dissatisfied with the judgement, the Defendant/Respondent appealed to the Delta State High Court which upon considering the appeal, reversed the victory of the Appellant. The Appellant in turn commenced an appeal process at the Court of Appeal, Asaba upon the grant of leave to file on the 6^th of May, 2019.

In the appeal which was argued by Romeo Ese Michael Esq. of D. A. Awosika & Partners, two issues were raised for determination by the appellate court, to wit;

1. Having regard to the case of the Appellant being tenement rate assessment against the Respondent, whether the lower court was wrong when it held that the Revenue Court of Delta State (court of first instance) had no jurisdiction to entertain the case presented to it by the Appellant. (Distilled from the Ground one(1) of the Notice of Appeal
2. Whether the fact that the contents of Exhibits ‘B’ and ‘C’ were not for residential purposes but office purposes it suffices for the learned judge of the court below to have set aside the judgment of the Revenue Court of Delta State. Distilled from Ground two(2) of the Notice of Appeal.

In its argument, the Appellant relied on the provision of Section 4(1) & (2) of the Revenue Law of Delta State which provides thus;

Section 4(1):

“The Revenue court shall have and exercise jurisdiction on all matters of revenue of the state or relating to:  (a) Revenue due or accruing to the state from whatsoever source; (b) Revenue due or accruing to the Local Council of the State.

Section 4(2); The jurisdiction conferred on the Revenue Court under Sub Section (1) of this section shall only relate to revenue arising from law having effect in the state.

They also reproduced the provision of section 7 of the Constitution, Federal Republic of Nigeria 7(5) which provides that:

The main functions of a Local Government Council are as follows: Assessment of privately owned houses of tenements for the purpose of levying such rates as may be prescribed by the House of Assembly of a state”. Learned counsel for the Appellant referred to ATTORNEY GENERAL OF CROSS RIVER STATE & ANOR. VS. MATHEW OJUA (2010) LPELR – 9014; KNIGHT FRANK RUTTLEY NIGERIA V. AG, KANO STATE (1998) 4 SC 251 OR (1998) 7 NWLR (PT. 556) 1 SC; SHELL PETROLEUM DEVELOPMENT CO. VS. BURUTU LGC. (1998) 9 NWLR (PT, 565) 318 to argue that the Local Government Counsel has the Constitutional power to assess tenement rates in privately owned houses.

They emphasized on the decision in ATTORNEY GENERAL OF CROSS RIVER STATE & ANOR. VS MATHEW OJUO (2010) LPELR – 1904 to show that property tax is fitting to be collected by Local Government because of the onerous responsibilities imposed on the said tier of Government by the Constitution and submitted that the lower court was wrong in its approach of seeing the trial court’s view as wrong, on the ground that the properties in respect of which the rates were imposed “were purely business purpose” as there was nothing in the law imposing that limitation or exception.

In its argument, the Respondent submitted that the evidence adduced shows that its steel structures and port cabins were in its flow station and gas plant and were for its oil exploration purposes and the structures jointly owned by the Respondent and NNPC (Nigerian National Petroleum Exploration) and which contrary to the provisions of section 16 of the Nigerian National Petroleum Corporation Act exempts such structures from tenement. They further argued that Counsel argued that the tenement rate being claimed by the Appellant from the Respondent is connected to the Respondent’s oil exploration activities, particularly the Gas Plant, which is a joint venture or ownership with the NNPC Drilling and emphasizing the Section 7(6) of the 4th Schedule to the 1999 constitution on the main function of a Local Government Council to include assessment of privately owned houses or tenements for the purpose of levying such rates as may be prescribed by the Houses of Assembly of the state.

The Respondents represented by Ayo Asala SAN contended that from the above, the Appellant’s power to demand for or collect tenement rate is limited to privately owned tenement or houses. In other words that tenement or building in which a public body or institution has an interest is not subject to tenement rate.

In its judgment, the Court of Appeal relied on the decision of the Supreme Court in SHELL PETROLEUM DEV. CO. VS. BURUTU L.G.C. where in interpreting the Section 16(i) of the Nigerian National Petroleum Corporation Act, Cap. 123, Laws of the Federation of Nigeria, 2004, the court held “oil pipelines and other installations” belonging to the corporation shall not be regarded as here ditaments or tenements to be valued for rating purposes; and for the purposes of this subsection, the expression “oil pipelines and other installations” includes oil rigs, refineries, power and generating plants, pumping stations, tank farms and similar installations but does not include office or residential buildings.

It held that office and residential buildings, as tenements, therefore, though belonging to the corporation are not oil pipelines and other installations for oil exploration and therefore subject to tenement rate assessment and payment. The Court further held that it is not correct as submitted by the Respondent’s counsel and in error agreed to by the learned trial judge that NNPC or its joint ventures are not obligated to be assessed and to pay tenement rate under the law.

It therefore decided that having regard to the case of the Appellant, being tenement rate  assessment against the Respondent, the lower court (court below) was wrong when it held that the Delta state Revenue Court had no jurisdiction to entertain the case presented to it by the Appellant, and that it did not suffice for the learned judge of the court below to have set aside the judgment of the Revenue Court because the contents of Exhibits ‘B’ and ‘C’ were not for residential purposes but office purposes.