DMO, Ecobank Differ On Oil Subsidy Payment | Independent Newspapers Limited
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DMO, Ecobank Differ On Oil Subsidy Payment

Posted: May 7, 2015 at 5:28 am   /   by   /   comments (0)

By Tunde Opeseitan/ Lagos


A Federal High Court in Lagos has fixed May 13 for hearing of committal application filed by Ecobank Nigeria Limited against the Director General of Debt Management Office (DMO), Abraham Nwankwo.

The application was sequel to Nwankwo’s alleged act of frustrating the bank’s move to recover a huge debt allegedly owed by an oil marketing firm, First Deepwater Discovery Limited.

Apart from Nwankwo, the bank also listed DMO’s officer directly in charge of processing fuel subsidy claims by oil marketers, Umaru Abubakar, as respondent in the committal proceeding.

The DMO is the agency of the Federal Government which processes fuel subsidy claims by oil marketers or issuing them with what is called sovereign debt notes.

According to court papers, Ecobank had, on February 25, 2015, secured an interim order of Justice Mohammed Yunusa of the Federal High Court directing DMO to transfer the outstanding fuel subsidy sum due to Deepwater Discovery Limited into the company’s account with Ecobank.

The bank claimed that Deepwater Discovery Limited had a cumulative fuel subsidy claim of about N1.8 billion with DMO, out of which it claimed that over N845 million was due for payment.

Justice Yunusa had, in the said order, directed DMO to transfer with dispatch the sum of N845 milion plus due to Deepwater into its account with Ecobank to offset part of the alleged debt the oil marketing firm allegedly owed the bank.

The judge had also directed DMO to “communicate the PEF/Admin Charges on the balance sum of N1,020, 451,733.22 to the plaintiff/applicant via the receiver/manager and to pay forthwith, remit or otherwise transfer the entire sum to the first defendant’s account with the plaintiff/applicant.”

However, Ecobank, through its lawyer, Kunle Ogunba claimed that though the agency, through its principal officers, were served with the enrolled order of the court since February 27, 2015, they had yet to take the necessary steps to transfer the said funds, thereby frustrating the bank’s effort at recovering its customers’ savings allegedly held by Deepwater.

In the affidavit filed in support of Forms 48 and 49, which Ogunba said were already served on Nwankwo and Abubakar, the deponent, one Ajibola Ajiboye, alleged that in spite of serving the alleged contemnors with the papers for contempt proceedings, they had refused to budge.

While urging the court to take a decisive action and commit Nwankwo and Abubakar to jail, Ajiboye said, “Contempt of court, being a deliberate disobedience of a court order, is a serious offence, which every court should not allow to go unpunished; this is because treating such an act with levity could lead to total destruction of the entire judicial system and all that the administration of justice stands for.”

But Nwankwo and Abubakar have, through their counsel, S.E. Omoraghon, urged the court to refuse the bank’s prayer for committal order against them.

In a counter-affidavit filed in opposition to Ecobank’s committal proceedings, the Principal Operations Officer of DMO, Sandra Ipigansi, maintained that the alleged contemnors were never served with the papers for contempt proceedings in personal capacities.

Besides, Ipigansi said the issue of disobedience to court order did not arise, because DMO could not have transferred the fund as directed by the court as the agency was never in custody of any subsidy claims by marketers.

According to Ipigansi, the role of DMO in subsidy claims is more or less administrative, while the money is usually kept and claimed from the Central Bank of Nigeria (CBN) by the concerned oil marketers.

She claimed: “Physical custody of the funds used for the payment of subsidy claims by oil marketers are, at all material times, kept and domiciled with the CBN.

“The 2nd defendant and its officers, by their mandate, do not keep custody of funds and do not directly touch funds meant for the subsidy claims payment and therefore lack the capacity to transfer funds to any account as directed by the court, as they do not have custody of the said funds.

“The duty of the 2nd defendant is more or less administrative and limited to the issuance of sovereign debt notes to oil marketers on the advice of the Petroleum Pricing Regulatory Agency (PPRA), after due diligence and other necessary payment procedure,” Ipigansi clarified.

She added that it was strange that a court would order DMO to remit the subsidy sum due to an oil marketer into the bank account of a judgment creditor.