Doing business in Nigeria can be
really frustrating and only a very rugged person can do business in Nigeria and
succeed. It is either they are facing illegal tax collectors and multi tax
system or they are facing the unceasing and sometimes irrelevant demands by
Customs, Standard Organization of Nigeria, NAFDAC, etc; not to mention the poor
infrastructures like roads, power supply, etc. that they have to put up with
that makes business clumsy and discouraging. No wonder most Nigerians shy away
from starting their own businesses; instead, they walk the streets and roads in
search of already made jobs.
A lot has been said since the
arrest of Chief Innocent Chukwuma, the CEO of Innoson Group. I am not sure of
what to believe but as someone who is working with a business man, I have
witnessed so much abuse meted out to those who are genuinely doing their
businesses and contributing to the development of this country. These are the
people the country ought to protect, encourage and pamper for helping to
develop the country amidst economic challenges. These are the same people
helping to reduce unemployment in Nigeria and thereby minimizing crime. The
authorities should have a rethink and be properly re-oriented before they
finally cripple the economy with their malicious activities. Nigeria cannot
survive under a harsh or unfriendly business environment.
Meanwhile below is a press
release published on Premium Times of December 24, 2017 from Innoson Group. The
facts are very clear and they are not far from what happens in Nigeria or what
business men in Nigeria go through to keep their business running. If you think
they are lying, then go and start your own business and find out yourself.
INNOSON VS GTB: Facts behind the
Figures: How the Battle between Innoson and GTB Started (Part 1)
The perfection of a man is based
on his ability to distinguish between facts and fiction through deductive
reasoning — Socrates
There have been many counter
narratives on the reason why EFCC arrested Innoson and equally we have seen GTB
response on its running battle with Innoson and his company Innoson Nigeria
Ltd.
According to C.P Scott, “Comments
are free but facts are sacred”. Now that this fight has become an open issue
and the public is yearning to know the truth concerning the issue Innoson has
with GTB, I will in a three (3) part series of articles reveal to Nigerians and
the world what really happened.
In a saner society, the company
secretary of GTB should have resigned by now and apologize to the Board of
Trustees and Shareholders of the bank, because every legal advice and decision
it gave to GTB backfired, thereby putting the bank in harms-way.
The battle between Innoson and
GTB started from a dispute between Innoson and customs when GTB decided to cry
more than the bereaved by appealing a valid court ruling ordering GTB to pay
Innoson judgment debt of N2.4B being the cost of his goods unlawfully seized
and auctioned by The Nigerian Customs.
The Genesis of Innoson Vs Customs
Court Case
Innoson established the first
indigenous motorcycle assembly plant in Nigeria and based on this effort, the
Federal Government, through the Federal Ministry of Finance gave a concession
to him to pay 5% on his imported motorcycle CKDs. The approval is in form of a
certificate. The certificate runs for 12 months after which it is renewed.
Between October and December 2004,
Innoson imported about 25 containers of motorcycle CKDs, his certificate was
yet to expire. The certificate expiration was on 12th July 2005.
When the goods arrived in
Nigeria, Innoson made efforts to clear the goods. He paid the required duty as
calculated by COTECNA- the inspection agent and he was issued a Clean Report of
Inspection (CRI) which showed the duty he was expected to pay.
After receiving the CRI from
COTECNA, he paid the duty by issuing cheque to be drawn in favour of the
Federal Government of Nigeria. His bank, GTB paid the money to the Federal
government. And then he was issued with a Customs Revenue Receipt. The Receipt
was issued by GTB that made the payment. The original copies were handed over
to the customs.
After the payment of the duty,
Innoson submitted all relevant documents to the Nigerian customs but the
customs failed to release the goods. The goods were not released because they
alleged that Innoson under paid the duty. The Customs said he was to pay 30%
duty rate. When Innoson learnt of this, he referred them to the concession
certificate which allowed him to clear his goods based on 5% duty rate.
In spite of showing the
certificate to them, Customs refused to release the goods and showed his
clearing agent a circular which didn’t mention the name of Innoson among the
list of companies enjoying such concession.
Upon receiving the letter,
Innoson protested by sending a written protest to the Minister of Finance. The
Minister of Finance gave a directive through a letter to The Nigerian Customs
to allow Innoson clear its goods. The Nigerian Customs then instructed their
officers to allow Innoson clear its goods at the concessional rate of 5%. The
directive was also done in writing via a letter dated 13/12/2005.
With the letter from the Minister
of Finance as well as The Nigerian Customs, Innoson re-submitted its documents
to the Nigerian Customs officials to enable him take delivery of the goods.
After the submission of the
documents, they still delayed in processing the documents. After the delay,
Innoson was given approval to take its goods as overtime cargo through a
written approval dated 1st Feb 2006, 2nd Feb 2006 and 9th Feb 2006 for the
three bill of laden respectively.
After receiving the written
approvals, Innoson made attempts to clear the goods. After customs had passed
the entry, Innoson could not locate the goods at the wharf. His clearing agent
continued searching for the goods at the wharf until the 1st of March, 2006
when they learnt that 18 of the 25 containers had been sold by the customs.
Upon hearing that the goods had
been sold by the customs, Innoson contacted its solicitors to write to the
Ministry of Transport, Finance and the Comptroller-General of Customs which
they did.
After sending the letter, the
Minister of Finance invited Innoson to a meeting. At the meeting, Innoson was
referred to the Chairman of the Presidential Special Committee on Port
Decongestion and the Comptroller-General of Customs, the meeting between the
three parties was held on 12th May, 2006 at Customs office in PZ Complex,
Ikorodu Town, Lagos.
At the meeting of 12th May 2006
with the Hon. Minister of Finance, Transport and the Assistant Comptroller
General of Customs and other stakeholders, the Chairman of the Presidential
Special Committee on Port Decongestion referred Innoson to the Assistant
Comptroller-General of Customs. The Assistant Comptroller-General directed
Innoson to forward all relevant documents to his office so that he can be
compensated.
On 18th May, 2006, Innoson
forwarded the documents requested for by the Assistant Comptroller General of
Customs through his solicitors.
The Customs ignored the documents
that was forwarded and sold the remaining containers. Innoson is yet to come to
terms why customs sold his containers. First of all, he was not notified that
his container was seized. He was not informed that his containers were to be
sold.
His containers never contained
any contraband goods but contained motorcycle CKDs. He did not at any time
abandon the containers containing the motorcycle CKDs at the port. He was never
taken to court. Innoson was not aware that there was a court order to sell his
goods. The Federal Government gave him a concession to pay less duty because he
owns an automated assembly line and as a result of the promise to increase the
local output. The assembly line had a workforce of about 750 workers.
The questions that remained
unanswered include:
• Whether the Customs has the
right to refuse the release of the goods as stated in the CRI? The CRI
reflected the 5% concession.
• How long do goods stay before
it is declared as an overtime cargo? Do goods stay in the port for 3 months and
thereafter become overtime
• Were the Customs Officials actually
carrying out their official duties or was there a conspiracy to destroy Innoson
by some people?
• There was a time lapse between
the period the goods were to be cleared. Innoson never applied for an overtime
clearance at any time. His goods were never gazetted before they were sold.
Innoson tried without success to
pay the duty stated on the CRI but was rejected by the customs. The customs
insisted that Innoson must pay 30% but Innoson still referred the Customs to
his concession certificate.
Innoson was not given any notice
to the effect that its containers were to be sold as overtime cargo after the
approval granted to him to clear the containers as overtime cargo.
Even as an overtime cargo, there
are procedures to be followed in selling it. These procedures were not
followed. The usual procedure when there is conflict of figures for payment, a
protest is lodged.
Innoson is not aware that any
committee was set up to sell his containers. The customs equally did not
advertise the sale of his container in any newspaper.
The procedure the presidential
Special Committee on Ports and the Customs for selling good by auction is as
follows;
(a) To notify the owner of their
intentions to sell the goods by auction
(b) To give notice of the
intended auction sale to the public through newspaper publication
(c) Set up a joint disposal
committee to sell the goods by auction.
None of these provisions of the
law was adhered to in auctioning his goods for sale. Therefore the Presidential
Special Committee and Ports decongestion had no basis for auctioning Innoson’s
goods after all genuine efforts by him to clear its goods.
Based on the damages that were
incurred by the seizure and subsequent auction of his goods by the customs,
Innoson through his solicitors sued the Nigerian Customs to the Federal High
Court, Ibadan division with the following pleas;
1. Judgment for the sum of N1
billion
2. 22.5% interest for the sum of
N1 billion
3. 22.5% on Judgment debt from
the date of judgment until the liquidation of the debt
4. Judgment for any other claim
as per the amended statement of the claim.
The Court Victory
The legal tussle between Innoson
vs Customs lasted for some years. After Innoson had presented his case to the
trial judge by providing all available facts and evidences to the trial judge
and having the Defendants presented its own arguments and defenses.
The trial court therefore ordered
the Custom to pay Innoson the sum of N2.4B being the cost of his goods and
damages incurred.
Furthermore, Innoson got a
garnishee order from the Court ordering GTB to pay the judgment debt of N2.4B
to him. GTB refused to pay this money.
Innoson had a loan he was
servicing with GTB at the time he got the judgment. Innoson had expected that
GTB would deduct their money and pay him the balance. The reason why GTB
refused to pay Innoson his money to ease him off from the damages and loss he
suffered was unclear to Innoson.
GTB decided to cry more that the
bereaved by appealing the court ruling on the garnishee to the Court of Appeal,
Ibadan Division.
However in a unanimous judgment,
delivered on 6thFebruary 2014, the Court of Appeal dismissed the appeal and
affirmed the judgment of the trial Court and ordered the Defendant (GT Bank) to
pay the said sum of N2.4B to Innoson.
Still aggrieved, GTB appealed to
the Supreme Court. The Supreme Court is yet to deliver its judgment. Today that
judgment debt is above N5B.
The questions Nigerians should
ask GTB
1. Why did it not pay Innoson the
Judgment debt as ordered by the court?
2. Does the Customs money ordered
by the court belong to GTB?
3. With N10B of Customs money in
GTB, why did it-GTB not pay this money, why did they decide to appeal the
judgment since The Customs never protested the judgment?
To be continued…….
Cornel Osigwe
Head Corporate Communications
Innoson Group
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