The Court of Appeal in Abuja has reversed the Federal High Court judgment that ordered the Central Bank of Nigeria (CBN) to pay Kasmal International Services N579 billion for its role in stamp duty collection. Justice Adebukola Banjoko, delivering the majority judgment, sided with the CBN’s argument that Kasmal had no legal right to be engaged by the Nigerian Postal Service (NIPOST) from the beginning.

On October 11, 2024, Justice Inyang Ekwo of the Federal High Court had ordered the CBN to pay N579,130,698,440 in interest to Kasmal and imposed a 10 percent annual interest rate on the judgment sum from January 1, 2015, to January 31, 2020. Justice Ekwo ruled that the CBN had already paid Kasmal a total of N10.3 billion, which represented 15 percent of remitted stamp duties by Deposit Money Banks between January 1, 2015, and January 31, 2020.

Kasmal’s lawyer argued that the company was appointed by NIPOST to collect a N50 charge on all receipts issued by banks for electronic transfers and teller deposits. However, the CBN and Attorney General of the Federation (AGF) contested the lower court’s ruling, claiming it was erroneous and that the funds Kasmal sought to recover were public monies governed by the provisions of the 1999 Constitution.

In a 2/1 decision, Justice Banjoko concluded that Kasmal lacked the legal standing to initiate the suit. She stated that the suit was fundamentally defective and that NIPOST had no statutory authority to manage or collect stamp duties, thus could not delegate powers to Kasmal.

Justice Okong Abang dissented, arguing that the majority’s judgment was flawed and that the AGF’s ratification of the contract and payment of N10.3 billion should prevent the CBN from denying Kasmal its rightful proceeds. He contended that the appeal lacked merit and should be dismissed.

The case highlights the ongoing complexities surrounding stamp duty collection in Nigeria, an indirect tax imposed on various financial transactions.