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The Federal High Court sitting in Abuja, on Friday, halted plans by the Federal Government to deduct $418million from the bank account of the 36 states of the federation.
The court, in a ruling that was delivered by Justice Inyang Ekwo, ordered FG to suspend the planned action, pending the determination of a suit that was brought before it by governments of the 36 states.
The restraining order followed an ex-parte application the Plaintiffs filed through their team of lawyers led by two Senior Advocates of Nigeria, Mr Jibrin Otukepa and Mr Ahmed Raji.
The Plaintiffs had in their application, prayed the court to intervene and stop FG from proceeding with the withdrawal which they said would completely cripple them financially.
They told the court that FG had insisted that the $418m it intends to withdraw from state accounts monthly, was to service a debt for contracts that were allegedly executed for the states.
The Plaintiffs told the court that after the said contracts were carefully scrutinized by their various Attorneys General, as well as a purported judgement debt the FG relied on, it was found that the 36 states were not parties to court action that resulted to the judgment debt.
Lead counsel to the Plaintiffs, Okutekpa, SAN, further submitted that the purported contracts claimed to have been executed for the states, were not known to any of the 36 state governments and is, therefore, a phoney contract.
He told the court that FG was the only party to the court case that led to the judgment.
He, therefore, argued that such judgment was not binding on the state governments.
Meanwhile, after he had listened to counsel to the Plaintiffs, Justice Ekwo, ordered FG not to make any deduction from the state account in respect of the purported court judgment until all issues relating to it are fully determined.
Cited as Defendants in the matter are the Attorney General of the Federation, the Finance Minister, Accountant General of the Federation and all banks in Nigeria.
While adjourning the matter till November 30, Justice Ekwo ordered the Plaintiffs to serve all the relevant court processes on the Defendants.