Court Declares Deductions from Federation Account to Fund FG’s Agencies Unconstitutional

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*Orders refund to Rivers State

Alex Enumah

Justice Ahmed Mohammed of the Abuja Division of the Federal High Court, on Wednesday declared as illegal, unlawful and unconstitutional the direct allocations made so far by the federal government from the federation account to fund the Nigeria Police Trust Fund.

Following the declaration, Justice Mohammed then barred the federal government from further making deductions from the Federation Account to fund agencies not listed in the 1999 constitution for direct allocation.

The court in a judgment held that section 161 and section 162 of the 1999 Constitution were glaringly breached by the federal government following the direct allocation from the Federation Account to the Police Trust Fund.

The suit challenging the continued deductions from the Federation Account to fund agencies belonging to the federal government was filed by the Rivers State Government.

Delivering judgment, the court held that section 162 of the 1999 is clear and unambiguous to the effect that only the Federal, States and Local Governments shall be allocated fund directly from the Federation Account.

The court also held that section 4 of the Nigeria Police Trust Fund Act 2019 relied upon by the federal government to justify the unlawful deductions from the Federation Account is inconsistent with section 162 of the 1999 Constitution which recognizes only the Federal, States and Local Governments.

Justice Mohammed while upholding that the suit of Rivers State against the unjust deduction succeed, ordered that the fund belonging to Rivers State but used to fund Nigeria Police Trust fund by the federal government should be refunded to the state.

The Judge however declined to extend similar order of refund to the 35 remaining states on the ground that they were not parties in the suit and that the Rivers State as the plaintiff in this matter did not file it on behalf of others.

The court upheld all arguments of Joseph Daudu SAN who stood for Rivers State that where the provisions of the 1999 Constitution are clear and unambiguous, they must be given their ordinary meanings

Justice Mohammed also agreed with Daudu that the federal government was completely wrong in the interpretation given to section 4 of the Nigeria Police Trust Fund Act to the effect that the Nigerian Police was established for the federal government alone and as such the funding is solely on the shoulder of the federal government.

Rivers State in a suit marked FHC/ABJ/CS/511/2020 and instituted on its behalf by former President of the Nigerian Bar Association NBA, Joseph Daudu challenged the decision of the federal government allocating funds directly from the Federation Account to fund some of its agencies claiming that the decision violated section 162 of the 1999 Constitution.

The Rivers State government also claimed that by the federal government’s unlawful action, it has deprived it substantial revenue from from the Federation Account and therefore prayed the court to nullify unlawful fund allocation from the Federation Account.

Plaintiff also claimed that the levies imposed on companies operating in Nigeria tby the federal government to be paid directly to the Nigeria Police Force Trust Fund instead of the Federation Account was also illegal, unlawful and unconstitutional because it has also deprived it of substantial revenue accruable to the state as taxes.

The Judge agreed with the plaintiff that under the relevant laws, such levies are supposed to be paid directly to the Federation Account and not to any federal government agencies.

“I have carefully perused the issues raised by the plaintiff and I agree that no other person or entity is permitted to benefit direct fund allocation from the Federation Account.

“Section 4 of the Nigeria Police Trust Fund Act 2019 relied upon by the defendant to make direct fund allocation from the Federation Account is untenable as it runs contrary to section 162 (3) of the 1999 Constitution which expressly stated that the federal government, state governments and local governments shall derive direct fund allocation from the Federation Account”.

Defendant in the matter are Attorney General of the Federation and Minister of Justice AGF, Accountant General of the Federation, Revenue Mobilization Allocation and Fiscal Commission and Minister of Finance.

However only the Attorney General of the Federation filled processes to defend the federal government action.

The AGF had in his preliminary objection asked the Federal High Court to decline jurisdiction in the matter on the ground that such suit ought to be filed directly at the Supreme Court.

However the preliminary objection was dismissed by Justice Mohammed on the ground that it was misplaced, absurd and Iacking jb meritorious.