Facts:

The appellant’s business is in the exploration and production of crude oil in Nigeria. In the course of its crude oil production, natural gas gets associated with it. As a result, the appellant implemented a programme to utilise and re-inject the natural gas. Where it was not possible or appropriate, the appellant flared the gas and paid prescribed sums to the Federal Government of Nigeria for the volume of gas flared. The appellant paid such sums for 2006 – 2008, which were receipted, but the Minister of Petroleum Resources failed to issue it with a certificate.

Sometimes in October, 2012, the respondent served the appellant with three notices of additional assessment of the petroleum profit tax for the periods of 2006 – 2008 accounting years and disallowed, as deductible expenses, payments the appellant made to the Federal Government of Nigeria for the gas flared for those years. The appellant objected to the notices of additional assessment on the ground that those payments constituted deductible expenses under the law. The respondent, in turn, refused and considered the objection invalid. Sequel to that, the appellant beseeched the Tax Appeal Tribunal via a 3-ground notice of appeal against the respondent seeking for certain reliefs. In reaction, the respondent joined issue with the appellant and denied liability. In a considered judgment, delivered on 17th March, 2015, the tribunal allowed the appeal and granted the appellant’s claims.

Aggrieved by the decision, the respondent appealed to the lower Court on a 3-ground notice of appeal. The lower court heard the appeal and in a considered judgment, delivered on 26th March, 2018, allowed the respondent’s appeal.

Dissatisfied, the appellant appealed to the Court of Appeal.