The Court of Appeal in Abuja has upheld the powers of the Economic and Financial Crimes Commission (EFCC) to investigate and prosecute tax evasion cases, reversing an earlier judgment by the Federal High Court that sought to limit the agency’s jurisdiction.
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In a unanimous decision delivered by a three-member panel comprising Justices Balkisu Bello Aliyu, Adebukunola Banjoko, and Okon Efreki Abang, the appellate court ruled that the EFCC is empowered by law to investigate tax-related offences, especially when tied to money laundering allegations.
Justice Aliyu, who read the lead judgment, held that the lower court erred when it ruled that the EFCC lacked statutory powers to probe tax evasion and could not extend its investigation into money laundering cases that have tax evasion as a predicate offence.
The Federal High Court, presided over by Justice Taiwo O. Taiwo, had in July 2022 delivered a judgment in favour of Insurance Resourcery and Consultancy Service Limited, which had sued the EFCC for inviting and interrogating its officials over alleged tax evasion. The company argued that only the Federal Inland Revenue Service (FIRS) had the legal right to investigate tax matters and cited several sections of the FIRS Act in its defence.
However, the EFCC, dissatisfied with the ruling, approached the Court of Appeal, relying on Section 46 of its establishing Act and advancing five grounds of appeal, including whether the trial court was correct in holding that it lacked the authority to investigate tax-linked money laundering cases.
In its judgment, the appellate court stated:
“The learned trial judge erred in holding that the EFCC has no power to investigate tax evasion in view of Section 46 of the EFCC Act. Further, since the FIRS Act itself specifically provides and supports collaboration between the FIRS and the EFCC and other government agencies in the investigation and enforcement of tax evasion, the above finding of the trial court that the Appellant cannot extend its investigation of money laundering to tax evasion as a predicate offence is not supported by law and therefore wrong.”
Justice Aliyu concluded that all issues raised were resolved in favour of the EFCC and declared the appeal meritorious.
“Consequently, the judgment of the Federal High Court, sitting in Abuja, delivered on 28th July 2022 by Hon. Justice Taiwo O. Taiwo in Suit No: FHC/ABJ/CS/457/2022 is hereby set aside in its entirety.”
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