Case Stated by High Court.
Petition against assessment for
Income Tax under section
14 (1) of Non-Natives Income
Tax (Protectorate)
Ordinance-Meaning of words"
derived from" in section 4
(1) of Ordinance-" Derived
from Nigeria" does not mean
.• derived from employment in
Nigeria ..•
Held: (Affirming the decision of
the learned trial Judge, that
income which is derived from
employment in Nigeria but is
neither derived from, nor
received in Nigeria is not
assessable for income tax under
section 4
(1) of the Non-Natives Income
Tax (Protectorate) Ordinance.
There is no need to set out the
facts.
Petitioner not represented.
D. Hagley
for Commissioner of Income Tax.
The following joint judgment was
delivered :-
BUTLER LLOYD, ACTING C.J.,
NIGERIA, CAREY AND BROOKE, JJ.
This is a case stated by the
Judge of the Enugu-Onitsha
Division for the consideration
of this Court in the following
terms :-
1. This is a petition against
assessment by Bertram Lasbrey,
Bishop, of the Church Missionary
Society, presented under section
14 (1) of the Ordinance.
2. Petitioner says-
(a)
that he was assessed to pay
income tax on salary received
during a period of leave in
England;
(b)
that his salary is paid from a
fund subscribed in England and
not continued to from Nigeria;
and (c) that therefore
his leave salary, being neither
derived from nor received in
Nigeria, is not assessable to
tax. 3. The Commissioner of
Income Tax says the leave salary
is derived from an employment in
Nigeria and therefore it is
assessable under section 4 (1)
of the Ordinance.
4. I held that the words of
section 4 (1) "income accruing
in, derived from or received in
Nigeria in respect of gains or
profits from any trade,
vocation, employment, etc.," do
not render the Petitioner's
leave salary liable to tax under
that section.
5. The question for the
consideration of the West
African Court of Appeal is
whether or not this is a correct
interpretation of the law.
I t is common ground that the
facts are as set out by
petitioner in :2 (a) and
(b) above.
The argument for the Crown was
the same in the Court below and
before Us and consisted of the
contention that the salary in
question is assessable as being
derived from Nigeria in the
sense that it is derived from
employment in Nigeria, and it
was argued that the case was on
all fours with Potters case
N.L.R. XI, page 144.
I n his decision on the case the
learned trial Judge said as
follows :-
" \Vith great rcspect to the
decision in that (i.e. Potters)
case, I am unable to apply it
here. If the section rearl
"chargeable income derived from
gains or profits from any
vocation, employment, etc" in
Nigeria." there is no doubt
Petitioner's leave salary would
be assessable. But these are not
the words of the section, and I
do not think the words of the
section " derived from Nigeria
in respect of gains or profits
from any vocation, etc .••. can
bear that interpretation.
" ,\s the section stands, I
think a distinction must be
drawn between the Petitioner's
case, and the cases, for
example, of a merchant or a
public servant in Nigeria, where
the income derives from Nigeria
in respect of the gains from his
trade or vocation, no matter
where the recipient receives it.
" The Petitioner's leave salary
is neither received in Nigeria
nor derived from Nigeria; I
therefore hold that it is not
assessable under section 4 (1)
of the Ordinance,"
In our opinion the learned trial
Judge was right in his decision
and for precisely the reasons
given in the above passage. Were
we to construe the word "derived
from Nigeria" as meaning "
derived from employment in
Nigeria" we should be reading
into the Ordinance words that
are not there and which would
materially affect the meaning.
This is a matter for the
Legislature and not for the
Court.
In our opinion the decision of
the learned trial Judge was
right and must be affirmed.