Abia State government has explained that the sealing off of the Enugu Electricity Distribution Company (EEDC), formerly Power Holding Company of Nigeria (PHCN), is a judicial matter caused by the refusal of the EEDC to remit all Pay As You Earn (PAYE) taxes deducted from workers’ salaries.
Information and Strategy Commissioner, Eze Chikamnayo, said the Board of Internal Revenue (BIR) discovered that the EEDC owes N623 million in remittances, dating to 2006, and communicated this to all relevant authorities, including the Ministry of Power.
However, Chikamnayo added, the judgment debt from 2006 to 2011, as allowed by the law, established a tax liability of N417 million, which led to demand notices being served on the EEDC; but it refused to pay.
He said the BIR took the EEDC to court “as has been the case with other organisations,” and he High Court granted an order to seal its offices in order to recover the amount.
He recalled that on November 23, 2013, the BIR attempted to seal off the EEDC but the company used the military and the police to resist it.
However, the EEDC had a meeting with the BIR on December 5, 2013 where it was resolved that the BIR should grant the EEDC two weeks from that date to enable it to liaise with the Nigeria Electricity Liability Management Company (NELMC) for the payment.
The EEDC further asked for January 20, 2014 as the date for the payment, failure of which the law would take its course, “but, in an apparent display of bad faith,” the EEDC went behind to file a suit in the High Court for stay of execution order.
The BIR followed the EEDC to court and it was not until October 2, 2014 when the court rejected the request of the EEDC for a stay of execution of the earlier order that the BIR moved to enforce the court order and sealed off the premises on October 9, 2014.
Chikamnayo said the state government has no hand in this obviously legal matter as the BIR is a statutory body with responsibilities and rights.
He advised the EEDC to act as other responsible corporate citizens and pay its taxes or alternatively act in good faith and approach the BIR for an amicable resolution of the issue in the interest of the public.
This is not the first time an organisation was sealed off by the BIR for non remittance of PAYE taxes and this shall not be the last, he warned.
However, based on promises made by the EEDC, Governor Theodore Orji has directed the BIR to re-open the premises of the EEDC to avoid any hardship such legal tussle may cause residents.
Chikamnayo advised the EEDC to reciprocate the gesture by paying the debt to avoid further embarrassment.