A Federal High Court sitting in Awka , Anambra State, on Wednesday, 21st June, ruled that the Minister of Finance, Budget, and National Planning is never permitted to deduct the statutory allocation from the Federation Account that is owed to a State in a suit brought by the Attorney General of Anambra State against the Minister of Finance, Budget and Planning alongside the Attorney General of the Federation who was joined as a party to the suit.
The Allocation of Revenue (Federation Account Etc) Act clearly states that the portion of funds from the federation account due to States and Local Governments shall be paid to the State who should then manage same for the benefit of their local governments. Accordingly, the learned justice Dimgba has posited that:
“Section 162 of the Constitution and the Allocation Of Revenue (Federation Account, Etc.) Act, 1982 does not permit any bilateral interaction between the Federal Government represented by the 1st Defendant and LGCs under a State. Section 162(5)(6)(7)(8) of the Constitution make it clear that any amount standing to the credit of LGCs must be allocated to the States who will in turn remit it to the State Joint Local Government Account and distribute them in the terms and manner approved by the National Assembly and State Houses of Assembly. In the event, any direct distribution of funds including refunds from the Federation Account to the LGCs in my view will be an infraction of the Constitution.
“And as I have held earlier, violation of law by a party is not one that is solved by resort to self-help by another party, or by a countervailing breach of the law by the activist party in a knock-for-knock or tit-for-tat formula. Violation of law by a party, where police powers have not been provided or granted to another seeking a remediation, can only be solved through judicial intervention initiated by the activist innocent party.”
His Lordship further added that “neither the Constitution in Section 162 nor the Allocation of Revenue (Federation Account Etc) Act gave the 2nd Defendant (Attorney General of the Federation) any role in the allocation or sharing of revenues accruable to any of the tiers of Government in the federation account. I see no reason therefore why the 2nd Defendant should pick up the cudgel and start fighting for local governments in Anambra State when none of them has invited it to do so, and also when neither the relevant statute nor the Constitution given it any role in the relevant legal field.”
The Attorney General of Anambra sort amongst other reliefs had asked the court to hold as follows:
A DECLARATION that upon a proper construction of the provisions of Section 162 of the Constitution of the Federal Republic of Nigeria, 1999 (as amended), read along with Sections 2 (2) and 3 (1) of the said Constitution, the 1st Defendant cannot appropriate any money standing to the credit of the Federation for any purpose, other than, for the purpose of distribution to the three tiers of government, namely; the federal government, state governments and local governments.
A DECLARATION that by virtue of the provisions of Section 162 of the Constitution of the Federal Republic of Nigeria, 1999 (as amended), read along with Sections 2 (2) and 3 (1) of the said Constitution and Sections 1 & 3 of the Allocation of Revenue (Federation Account, Etc) Act, 1982, the 1st Defendant cannot make deductions from the statutory allocation to which the Plaintiff is entitled from the Federation Account for the purpose of crediting the Local Governments of Anambra State through the State Joint Local Government Account.
A DECLARATION that having regard to the provisions of Section 162 of the Constitution of the Federal Republic of Nigeria, 1999 (as amended), read along with Sections 2 (2) and 3 (1) of the said Constitution and Sections 1 & 3 of the Allocation of Revenue (Federation Account, Etc.) Act, 1982, the Defendants cannot, on behalf of the federal government, authorize the direct remittance of any funds to the Local Governments of the Plaintiff from the Federation Account.
Justice Dimgba said in delivering his verdict has said that, “In my view, there is no basis for the 1st Defendant to deduct the funds and retain them transitorily, that is, in escrow, Even sending the money directly to the local governments has no basis. As I alluded to before, doing so would be clearly illegal under both the Constitution and the Allocation of Revenue (Federation Account Etc.) Act, as none of them established any provisions for a direct transfer of the 1st Defendant’s entitlements from the federation account to local governments”.
Earlier the defendants had challenged the court’s jurisdiction, contending that the suit constitutes a dispute between the Federation and a State (Anambra) of which the Supreme Court has exclusive original jurisdiction by virtue of Section 232(1) of the Constitution.
While warning against swamping the Supreme Court with every matter that has an agent of the federal government as a party, Justice Dimgba held:
“By virtue of Section 251(1)(r) 1999 CFRN, the Federal Government or any of its agencies can be sued in this Court for a declaration or injunction affecting the validity of any executive or administrative action or decision by the Federal Government or any of its agencies. And in this case, the Plaintiff is challenging the administrative action or decision of the 1st Defendant (a Minister of the Federal Government in charge of Finance) to deduct from its monthly statutory allocation and either withhold or directly remit same to the Local Government Councils (LGCs) as their share of the Paris Club Refund…
“It certainly cannot be that whenever a State has concerns in relation to the manner in which a federal official such as a minister or a federal agency such as the Economic and Financial Crimes Commission (EFCC) exercises its responsibility that affects that State adversely, then that activates a dispute between the federal government and the state in which only the Supreme Court will have original jurisdiction. May that day never come in which the apex court gets reduced to a magistrate court entertaining all sorts of sundry original matters simply because a state and federal officials are involved…”
View and Download CTC of Full Judgment below: