The Oyo State Board of Internal Revenue has given reasons why it sealed offices of the Ibadan Electricity Distribution Company (IBEDC).
The board, which in a statement by its Chairman, Mr. Femi Awakan, stated that the IBEDC was in tax default in excess of N400 million, said the state government duly obtained an order of distraint from the Oyo State High Court before sealing some of the offices of the distribution company.
The offices affected in Wednesday’s action include the company’s headquarters at Ring Road, Ibadan and its offices at Mobil, off Ring Road, Dugbe, Ojoo/Iwo Road office as well as Monatan, all in Ibadan.
The government had applied for the warrant to enforce the payment through suit No. M/122/2022, with the Governor of Oyo State, the Attorney-General and Commissioner for Justice, and the Board of Internal Revenue Service of Oyo State as applicants, while IBEDC is the respondent.
According Mr. Awakan, the government had, in line with its commitment to the upholding of the rule of law, filed an application before Justice O.M Olagunju, seeking the issuance of a warrant authorising its officers to “distraint upon any land, premises or places of which the respondent (IBEDC) is the owner.”
The Internal Revenue boss said the court order is to enable the government to enforce the payment of arrears of taxes to the tune of N400,546,111,41k, being taxes accumulated by the IBEDC in respect of Harmonised bills, Infrastructure bills, Tax Audit bills and Signage bills, and which the company had failed to pay in the last two years.
He gave the breakdown of the bills as follows:
· Harmonised Bill- N139.440,000.00
· Infrastructure Bills-N122.590,000.00
· Tax Audit Bills- N116,516,111.41
· Signage Bills- N22,000,000.00
“It is to be noted that the IBEDC has a statutory obligation to deduct and remit revenue bills to the government of Oyo State through the Board of Internal Revenue. It is also to be noted that the distribution company failed and neglected to remit any such personal income tax of its employees within the period under review and that the Board of Internal Revenue several times served requisite demand notices calling attention to the company’s tax liabilities/obligations,” the statement said.
The statement noted that relying on section 45 of the Revenue Law of Oyo State, the presiding judge, Justice Olagunju, issued a warrant “authorising one or all of the named officers to distrain upon any land, premises or places of which the respondent is the owner particularly the respondents head office at Ring Road and Dugbe Ibadan for the purpose of enforcing payment of taxes in the sum of N226,756,000.41k only, representing its outstanding tax liability for the year 2021 of assessment which has become final and conclusive.”
The statement said though the Court order affirmed the 2021 tax liabilities to the tune of N226,756,000.41, as final and conclusive for immediate enforcement, the total tax arrears payable by IBEDC is in excess of N400 million and this excludes land use charges and others.
It added that the board acting on the court order, gave effect to the warrant and sealed off some of the offices of the IBEDC.
IBEDC responds
Reacting to the government’s closure of its offices, the IBEDC alleged that the government of was indebtef to it to the tune of N450m indebtedness in the past three years.
The company in a statement signed by its Chief Operating Officer, Engineer John Ayodele, described the closure of its offices by the government without due notification as unjust.
It said the action of the Agency of government was borne out of its non readiness to offset the huge bill.
However, the state government on the other hand accused IBEDC of breach of contractual agreement especially in the payment of statutory revenue bill.
Responding to the government’s claim that the company was indebted to it, said the government did not follow the normal procedure of debt recovery.
It described the action as retaliatory and illegal, adding that the issue of revenue bills and personal income arising now is quite suspicious.
The company argued that government should workout modalities for settling its huge debt instead of what could be best described as a witch hunt.
He explained that the company as part of efforts to get the outstanding paid through several engagements by way of correspondences and physical meetings, yielded no result .
“No business in this country can run successfully with such a huge outstanding. The power we distribute to customers must be accounted for and paid for; we have no choice but to disconnect the Oyo State Secretariat. So, it is worrisome to see that the government has sealed our offices with this underhand and arm twisting tactics instead of paying the debt owed. This was not done in good faith and it would have damaging effect on the business and service delivery to our customers”, the statement said.
The company called on Governor Seyi Makinde to look into the matter in the interest of all concerned as failure to do so would further worsen the power challenges and pressure on residents and commercial activities within the state.