Alleged FAAC Deductions: Adamawa, Oyo States Take FG To Supreme Court

The Adamawa State government, and the Oyo State government have dragged the Federal government before the Supreme Court over alleged deductions from the Federation Account.

The States are seeking an interpretation of Section 162 (1), (2), and (3) of the constitution regarding the distribution of revenue from the account.

Specifically, in suit number SC/CV/547/2024 between the Attorney General of Oyo State and the
Attorney General of the Federation, the State filed by Chief Bolaji Ayorinde SAN, the statement is asking the apex court to restrain the federal government from further deduction for the purposes of funding any project or effecting any payment whatsoever, except for the constitutional purposes of distributing such monies or amount among the Federal, State and and the Local Government Council.

The State is praying for an order of injunction restraining the Federal Government of Nigeria, whether by herself, agencies. Commissions, officers, servants, and/or privies or howsoever described, from making any further deductions or charges from the Federation Account for the purposes of funding any project or effecting any payment whatsoever, except for the constitutional purposes of distributing such monies or amount among the Federal, State and Local Government on such terms and in such manner as may be prescribed by the National Assembly, as provided by Section 162 of the Constitution of the Federal Republic of Nigeria, 1999 (As Amended).

Oyo State is also seeking for an order directing the Federal Government, whether by herself, agencies, Commissions, officers, servants, and/or privies or howsoever described to henceforth pay and distribute such sums or amount standing credit of the Oyo State Government and the Local Government Councils, from the Federation Account, from time to time, to the Oyo State Government, in accordance with the mandatory provisions of Section 162(4) and (5) of the Constitution of the Federal Republic of Nigeria, 1999 (As Amended) on such terms and in such manner as may be prescribed by the National Assembly.

The state also seeking for the following declarations “A declaration that it is contrary to the provisions of Section 162 of the Constitution of the Federal Republic of Nigeria, 1999 (as Amended) for the Federal Government of Nigeria to deduct, charge or howsoever deal with any amount standing to the credit of the Oyo State Government in the Federation Account, in furtherance of any alleged debt, agreement or howsoever described,

“A declaration that by virtue of the provisions of Section 162 of the Constitution of the Federal Republic of Nigeria, 1999 (as Amended), the Federal Government of Nigeria lacked the constitutional powers to deduct,
charge any sum or in any other manner deal with any amount standing to the
credit of the Oyo State Government in the Federation Account before
distribution of the revenue to the Oyo State Government.

“A declaration that the act or conduct of the Federal Government of Nigeria in unilaterally deducting or charging any sum from the amount due and standing to the credit of the Oyo State Government in the Federation Account, in furtherance of any agreement, charge etc before distribution of remainder of the revenue to the Oyo State Government is illegal, unconstitutional, null and void.

“A declaration that in view of the provisions of Section 162 of the Constitution of the Federal Republic of Nigeria, 1999 (as Amended), it is illegal and unconstitutional for the Federal Government of Nigeria to make deductions as a first line charge from any amount standing to the credit of the Oyo State Government in the Federation Account, to fund the following, to wit: (a) Priority projects to the Federal Inland Revenue Services;
(b) Transfer to the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA);
(c) Allocation to North East Development Commission;
(d) Consultancy fee from recovery of lost Revenue from Dom crude;
(e) Special Intervention — Nigerian Military Deduction;
(f) | Refund on withdrawals from Excess Crude Account (ECA);
(g) Refund Due to States on Signature Bonus;
(h) Intervention to States for Infrastructure; and
(i) Presidential Task Force of Metering.

“An order directing the Federal Government Nigeria, whether by herself, agencies, Commissions, officers, servants, and/or privies or howsoever described to henceforth pay and distribute such sums or amount standing credit of the Oyo State Government and the Local Government Councils, from the Federation Account, from time to time, to the Oyo State Government, in accordance with the mandatory provisions of Section 162(4) and (5) of the Constitution of the Federal Republic of Nigeria, 1999 (As Amended) on such terms and in such manner as may be prescribed by the National Assembly.

It it Originating Summons Brought Pursuant To Sections 4, 6(6)(a) & (b) and 162 of the Constitution and Order 3 Rules 1 & 6 of the Supreme Court Rules (As Amended 2014) and under the inherent jurisdiction of the court.

Oyo State (the Plaintiff), is seekin for the determination of the following
questions: “whether it is not contrary to the provisions of Section 162 of the Constitution of the Federal Republic of Nigeria, 1999 (as Amended) for the Federal Government of Nigeria to deduct, charge or howsoever deal with any amount standing to the credit of the Oyo State Government in the Federation Account, in furtherance of any alleged debt, agreement or
howsoever described?

“Whether in view of the provisions of Section 162 of the Constitution of the Federal Republic of Nigeria, 1999 (as Amended), the Federal Government of Nigeria lacked the constitutional powers to deduct, charge any sum or in any other manner deal with any amount standing to the credit of the Oyo State Government in the Federation Account before distribution of the revenue to the Oyo State Government?

“Whether in view of the provisions of Section 162 of the Constitution of the Federal Republic of Nigeria, 1999 (as Amended), it is not illegal and unconstitutional for the Federal Government of Nigeria to make deductions, as a first line charge, from any amount standing to the credit of the Oyo State Government in the Federation Account, to fund the following, to wit:
(a) Priority projects to the Federal Inland Revenue Services;
(b) Transfer to the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA);
(c) Allocation to North-East Development Commission;
(d) Consultancy fee from recavery of lost Revenue from Dom crude;
(e) Special Intervention – Nigerian Military Deduction;
(f) Refund on withdrawals from Excess Crude Account (ECA);
(g} Refund Due to States on Signature Bonus;
(h) Intervention to States for Infrastructure; and
(i) _ Presidential Task Force of Metering

Also, Adamawa state government in its suit is states that the entire sum in the Federation Account must be distributed among all levels of government without deductions, except as permitted by law,”

“The president must comply strictly with the Constitution in managing and distributing revenue,” the Adamawa State government stressed, adding, “All revenue collected, except those exempted by the constitution, must be paid into the Federation Account for distribution to all tiers of government.”

The state government is seeking a declaration from the Supreme Court that any deductions or withholdings made without constitutional backing be declared unconstitutional.

“The federal government’s discretion to manage revenue is limited to only what is expressly permitted by the constitution,” the government stated.

Adamawa State is seeking a strict interpretation of the constitution to ensure that revenue distribution is conducted without arbitrary deductions or withholdings by the federal government.