The Federal Inland Revenue Service (FIRS) and Orchid Nigeria Ltd, Abuja, have agreed to settle the N3.5 million tax disputes between them out of court. Orchid had taken the Nigerian Customs Service (NCS) and the FIRS to the Tax Appeal Tribunal in Abuja over non-refund of N3.5million Value Added Tax (VAT).

The appellant’s counsel, Mr Obi Nwankwo, had alleged that the first and the second respondents erroneously charged VAT on the Advance Simulator Systems imported for the training of students at the Maritime Academy of Nigeria, Oron, Akwa Ibom.

Orchid averred that under the first schedule of the VAT Law No. 102 of 2007 (as amended), books and educational materials were exempted from VAT. The appellant stated that upon clearing the items, it was erroneously charged VAT to the tune of N3.5 million contrary to the provision of the tax law.

Mr Bright Igbinosa, Counsel to second respondent, told the tribunal that the Nigerian Customs Service and the FIRS had met with a view to settling the matter out of court with the appellant. Igbinosa, therefore, prayed the court for an adjournment. The appellant’s counsel said, “The case is for hearing and we have witness in court, the two respondents did not file any response to our appeal.”

Nwankwo said that the counsel to the second respondent had informed him that the FIRS management was working hard to see that the “matter is settled out of the tribunal and the money paid back”. The acting Chairman of the Tribunal, Mr Nnamdi Ibegbu (SAN), adjourned the case to April 9 to enable the parties to file their out of court settlement report.