ACCESS BANK LTD vs. MARKET DIRECT AND OTHERS [2018]DLHC3458

Date	2018-05-21
Suit No.	SUIT NO. CM/0048/16
Citation No.	[2018]DLHC3458

GEORGE K. KOOMSON JUSTICE OF THE HIGH COURT

A.A. ACKUAKU JNR FOR THE APPLICANT

CALEB OKOE FOR THE RESPONDENT

[2018]DLHC3458
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													<main id="main" class="content" style="min-height: 60rem" >ACCESS BANK LTD<o:p></o:p>vs.<o:p></o:p>MARKET DIRECT AND OTHERS<o:p></o:p>[HIGH COURT (COMMERCIAL
DIVISION), ACCRA]<o:p></o:p>SUIT NO. CM/0048/16&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;21ST
MAY, 2018<o:p></o:p><div style="mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt;
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<o:p>&nbsp;</o:p>

</div>COUNSEL:<o:p></o:p>A.A. ACKUAKU JNR FOR THE APPLICANT <o:p></o:p>CALEB OKOE FOR THE RESPONDENT <o:p></o:p><div style="mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt;
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<o:p>&nbsp;</o:p>

</div>CORAM:<o:p></o:p>GEORGE K. KOOMSON JUSTICE OF THE HIGH COURT <o:p></o:p><div style="mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt;
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</div>RULING<o:p></o:p><div style="mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt;
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</div><p class="MsoNormal" style="margin-top:6.0pt;margin-right:-.2pt;margin-bottom:
0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;mso-pagination:
none;border:none;mso-padding-alt:31.0pt 31.0pt 31.0pt 31.0pt;mso-border-shadow:
yes">In this application the Receivers/Managers/Applicants pray the
Court for a declaratory Order that the Revenue Administration Act, 2016 (Act
915) is not applicable to a secured debt which has a proceeding on it pending
in a court of law and for a further order debonding the warehouse of the 4th
Defendant which has been the subject-matter of sale during the
Receivership period. <o:p></o:p><p class="MsoNormal" style="margin-top:6.0pt;margin-right:.2pt;margin-bottom:
0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;mso-pagination:
none;border:none;mso-padding-alt:31.0pt 31.0pt 31.0pt 31.0pt;mso-border-shadow:
yes">I have read the application and supporting affidavit. I have
further read the affidavit in opposition and the supplementary affidavit in
opposition. Regard has been given to the oral submissions made by both Counsel
for and against the motion. I have given thoughtful consideration to Section
110(5) and 111 of the Revenue Administration Act, 2016 (Act 915) and Section
46(7) of the Income Tax Act, 2015 (Act 896). <o:p></o:p><p class="MsoNormal" style="margin-top:6.0pt;margin-right:-.2pt;margin-bottom:
0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;mso-pagination:
none;border:none;mso-padding-alt:31.0pt 31.0pt 31.0pt 31.0pt;mso-border-shadow:
yes">It is however useful for me to place emphasis on the Section 46(7)
of the 7th Schedule of Act 896 which provides: <o:p></o:p><p class="MsoNormal" style="margin-top:6.0pt;margin-right:148.55pt;margin-bottom:
0in;margin-left:.5in;margin-bottom:.0001pt;text-align:justify;mso-pagination:
none;border:none;mso-padding-alt:31.0pt 31.0pt 31.0pt 31.0pt;mso-border-shadow:
yes">“Subparagraph
(6) does not apply to secured debt” <o:p></o:p>The preceding paragraph 6 had stated that in making payment out of
proceeds of the sale of assets, a receiver shall give priority to unpaid Value
Added Tax and withholding tax over all other debts of the tax payer. <o:p></o:p><p class="MsoNormal" style="margin-top:6.0pt;margin-right:.45pt;margin-bottom:
0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;mso-pagination:
none;border:none;mso-padding-alt:31.0pt 31.0pt 31.0pt 31.0pt;mso-border-shadow:
yes">In the case before me, the issues which I have to resolve are
whether or not the Act 915 can have retroactive effect and thereby place a duty
on the receivers to settle the tax debt of the company under receivership (if
any) as a priority. The other issue is as to whether it is just for the court
to order the debonding of the warehouse. <o:p></o:p><p class="MsoNormal" style="margin-top:6.0pt;margin-right:-.2pt;margin-bottom:
0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;mso-pagination:
none;border:none;mso-padding-alt:31.0pt 31.0pt 31.0pt 31.0pt;mso-border-shadow:
yes">In the first place, Ghana Revenue Authority has failed to
establish that the 4th Defendant owed any Value Added Tax or a
withholding tax. GRA filed an affidavit on 18th May, 2018 with a
demand notice attached which is dated May 13, 2016. <o:p></o:p>Reading through the said
exhibit GRA ‘1’, I do not find any reference to a withholding tax or Value
Added Tax. The paragraph 3 of the said demand notice states: “Total duties,
taxes and penalty payable amounts to Twenty-three Million, One Hundred and
seventy-One Thousand, Two Hundred and Seventy-One Ghana Cedis and four pesewas
(GH¢23,171,271.04).” <o:p></o:p>Clearly, even where the case of
the GRA is given any consideration under the subsection 6 of Section 46 of Act
896, I find it difficult to agree with GRA that the 4th Defendant
owed a debt in the nature of Value Added Tax or withholding tax. The mere
mentioning of duties, tax and penalty in exhibit GRA’1’ is not sufficient proof
of the tax liabilities of 4th Defendant in the nature of Value Added
Tax or Withholding Tax. It appears to me that GRA had not served the 4th Defendant
with any notice of tax liability. If they had, they would have filed a copy in
this </main>