The Federal Inland Revenue Service (FIRS) has urged the Federal High Court in Abuja to dismiss Binance Holdings Limited’s application seeking to vacate an earlier ex-parte order that allowed the tax agency to serve court documents through substituted means.
Binance, along with its representatives Tigran Gambaryan and Nadeem Anjarwalla, is facing a lawsuit filed by FIRS, demanding $79.5 billion in damages for economic losses allegedly caused by the company’s operations in Nigeria.
Justice Inyang Ekwo, in a ruling on February 11, had granted FIRS permission to serve its originating summons and accompanying documents via email, citing Binance’s lack of physical presence in Nigeria.
The decision came after FIRS lawyer, Kanu Agabi (SAN), argued that the cryptocurrency firm’s absence from Nigeria hindered the standard service process.
Binance Challenges Ex-Parte Order
Binance’s legal representative, Chukwuka Ikwuazom (SAN), filed a motion on April 4, urging the court to set aside the ex-parte order, arguing that the tax agency had violated court rules on service protocols.
- Ikwuazom contended that Binance is a Cayman Islands-registered company, and as per court regulations, legal documents must be delivered to a director, secretary, or principal officer or left at the company’s registered office.
- According to him, substituted service via email does not conform to the prescribed procedure for serving entities outside jurisdiction.
- He further stated that FIRS failed to obtain prior approval from the court for service outside Nigeria, asserting that substituted service is only valid when a foreign government or court certifies that service attempts have failed.
Binance requested the court to invalidate the electronic service and grant relief in its favor.
FIRS Counters Binance’s Submission
In response, FIRS filed a counter-affidavit on April 14, arguing that Binance’s claims were false and misleading.
- Litigation officer Ishaya Isuwa stated that the cryptocurrency firm’s actual registration status is unclear, as Binance has no registered office in the Cayman Islands but maintains significant economic activity in Nigeria.
- FIRS further maintained that Binance operates globally through an online platform, facilitating cryptocurrency transactions within Nigeria’s financial ecosystem.
- Isuwa also dismissed Binance’s assertion regarding substituted service, stating that Eleanor Hughes, whose email was used, is Binance’s General Counsel and principal officer, who has previously engaged Nigerian authorities on legal matters.
He cited instances where Hughes had appointed legal representation in Nigeria, confirming her active role in receiving official court communications.
Additionally, FIRS noted that the agency attempted to serve court documents directly on Binance’s representative, Tigran Gambaryan, while he was detained at Kuje Correctional Centre, but Binance directed that documents be served through its legal representatives, Aluko & Oyebode.
The tax agency emphasized that Binance had adequate knowledge of the legal proceedings, evident from its legal team’s appearance in court, and urged the court to dismiss Binance’s application in the interest of justice.
What you should know
Binance, along with its representatives Tigran Gambaryan and Nadeem Anjarwalla, is facing a lawsuit filed by FIRS, demanding $79.5 billion in damages for economic losses allegedly caused by the company’s operations in Nigeria.
- The originating summons, marked FHC/ABJ/CS/1444/2024, requests the court to determine whether Binance is liable for annual corporate income tax, pursuant to Section 13(2) of the Companies Income Tax Act and the Significant Economic Presence Order 2020.
- In an earlier ruling in October 2024, Justice Emeka Nwite released Gambaryan after the Federal Government withdrew money laundering charges against him and Binance. Meanwhile, Anjarwalla, a Binance executive, escaped from custody on March 22, 2024, raising further legal complications surrounding the case.
The court has scheduled May 12 for the next hearing, where it will deliberate on Binance’s motion against FIRS’s substituted service process.
