Facts:

The appellant, a telecommunication company in Nigeria, executed a contract with New Skies Satellites (NSS), a non-Nigerian company based in the Netherlands for the supply of bandwidth capacities for appellant’s use in Nigeria. The bandwidth was received in the appellant’s base station in Nigeria. The respondent assessed the transaction to Value Added Tax (VAT) and issued a re-assessment notice – an assessment which the Appellant repeatedly objected to, on the ground that it had no obligation to remit VAT as the receiver of the service. The appellant also contended that NSS was not under any legal obligation to register for VAT in Nigeria based on the provision of the VAT Act. Thus, VAT liability could not have arisen from the transaction. As a result, the appellant took the matter to the Tax Appeal Tribunal.
After the hearing, the Tribunal dismissed appellant’s matter and ordered it to pay the tax as assessed by the respondent. Dissatisfied with the Tribunal’s decision, the appellant appealed to the Federal High Court. The lower Court in its final decision dismissed the appeal and affirmed the decision of the Tribunal. Further dissatisfied with the decision of the lower Court, the appellant appealed to the Court of Appeal. One of issues for the determination was whether the transaction between NSS and the appellant is subject to VAT.