ALUMINIUM INDUSTRIES V. FEDERAL BOARD OF INLAND REVENUE

• Pages: 6-13

6

NIGERIAN SUPREME COURT CASES

[1971] N.S.C.C.

ALUMINIUM INDUSTRIES V. FEDERAL BOARD

OF INLAND REVENUE

ALUMINIUM INDUSTRIES AKTIEN

GESELLSCHAFT

V

APPELLANTS

FEDERAL BOARD OF INLAND

REVENUE

RESPONDENTS

SUPREME COURT OF NIGERIA

SUIT NO. SC 6

4

/

1

970

ADEMOLA,

C.J.N.

COKER,

J.S.C.

LEWIS,

J.S.C.

MADAR1KAN,

J.S.C.

UDOMA,

J.S.C.

15th January, 1971.

Taxation - Foreign companies, taxation o

1 - Reliance on "right to

f - Companies Income Tar Act, 1961,

deeming" provision to the charging section, CI TA.

Commercial Law - Companies - Cop orate idetztity of - Place of resident of

companies -Foreign companies - Choses in action - Contract debt Where

enforceable - Contractual stipulations

Conflict of Laws - International trade - Location of property - Taxation.

ISSUES:

1.

Whether a foreign company can become resident or carry on business in

Nigeria, merely by owning the share capital of a Nigerian company.

2.

Whether the rule that a contract debt is enforceable where the debtor resides

can be displaced by a stipulation for payment elsewhere.

3.

Whether interest on a loan contracted outside Nigeria is payable in Nigeria.

FACTS:

The appellant appealed to the Appeal Commissioners against assessments of

The appellant company was registered and resident in a foreign country. It was

not resident in Nigeria and had no place of business in Nigeria. It owned all the

shares in a Nigerian manufacturing company, and incurred expenditure outside

Nigeria for the Nigeria company on current account. By an agreement made in

the appellant's country, the companies agreed that part of the Nigerian company's

indebtedness on the current account should be transferred to an interest-bearing

loan account in the appellant's country, and that the loan was in the currency of

that country and was to be repaid in that currency. The respondent assessed the

appellant for tax on interest debited to the Nigerian com

The appellant appealed to the A

pany on the loan account.

ppeal Commissioners against the assessments,

on the ground that the interest was not derived and could not be deemed to be

derived from Nigeria because the appellant carried on no trade or business

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