on January 10, 1979 when private respondent filed the appeal with the
Court of Tax Appeals, it consumed a total of only thirteen (13) days well
within the thirty day period to appeal pursuant to Section 11 of R.A.
1125.
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the correct amount of tax; Provided, however, That failure to file a
return shall not prevent the Commissioner from authorizing the
examination of any taxpayer.
The tax or any deficiency tax so assessed shall be paid upon notice
and demand from the Commissioner or from his duly authorized
representative. . . ."
Thus, the authority to make tax assessments may be delegated to
subordinate officers. Said assessment has the same force and effect as
that issued by the Commissioner himself, if not reviewed or revised by
the latter such as in this case.
NOTE: It is a general rule that reiteration of demand to pay tax
deficiency after a protest is deemed a denial of that protest, and thus
constitutes a decision subject to appeal. 30 day period to appeal
commences from the time the demand letter was received by the
taxpayer.
RCBC v. CIR
G.R. No. 168498 April 24, 2007
FACTS: Petitioner reiterates its claim that its former counsels failure to
file petition for review with the Court of Tax Appeals within the period
set by Section 228 of the NIRC was excusable. Petitioners motion for
reconsideration is denied for lack of merit. Other than the issue of
prescription, which is raised herein for the first time, the issues
presented are a mere rehash of petitioners previous arguments, all of
which have been considered and found without merit in our Decision
dated June 16, 2006. Petitioner maintains that its counsels neglect in
not filing the petition for review within the reglementary period was
excusable. It alleges that the counsels secretary misplaced the
Resolution hence the counsel was not aware of its issuance and that it
had become final and executory.
ISSUE: Is it correct for petitioner to argue that there is no final decision
because of the inaction of the CIR?
HELD: NO, in the instant case, the Commissioner failed to act on the
disputed assessment within 180 days from date of submission of
documents. Thus, petitioner opted to file a petition for review before
the Court of Tax Appeals. Unfortunately, the petition for review was
filed out of time, i.e., it was filed more than 30 days after the lapse of
the 180-day period. Consequently, it was dismissed by the Court of Tax
Appeals for late filing. Petitioner did not file a motion for
reconsideration or make an appeal; hence, the disputed assessment
became final, demandable and executory.
Based on the foregoing, petitioner cannot now claim that the disputed
assessment is not yet final. After availing the first option, i.e., filing a
petition for review which was however filed out of time, petitioner
cannot successfully resort to the second option, i.e., awaiting the final
decision of the Commissioner and appealing the same to the CTA, on
the pretext that there is yet no final decision on the disputed
assessment because of the Commissioners inaction.
After its petition for relief from judgment was denied by the Court of
Tax Appeals for lack of merit, petitioner filed a petition for review
before this Court without raising the issue of prescription. It is only in
the instant motion for reconsideration that petitioner raised the issue
of prescription which is not allowed. The rule is well-settled that points
of law, theories, issues and arguments not adequately brought to the
attention of the lower court need not be considered by the reviewing
court as they cannot be raised for the first time on appeal
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was not within the jurisdiction of the CTA and should have been
decided in accordance with the mode of settlement and adjudication
set forth in Sections 2 and 3 of P.D. No. 242, viz:
SEC. 2. In all cases involving only questions of law, the same shall be
submitted to and settled or adjudicated by the Secretary of Justice, as
Attorney General and ex officio legal adviser of all government-owned or
controlled corporations and entities, in consonance with section 83 of
the Revised Administrative Code. His ruling or determination of the
question in each case shall be conclusive and binding upon all the
parties concerned.
SEC. 3. Cases involving mixed questions of law and of fact or only
factual issues shall be submitted to and settled or adjudicated by:
(a) The Solicitor General, with respect to disputes or claims or
controversies between or among the departments, bureaus, offices and
other agencies of the National Government;
(b) The Government Corporate Counsel, with respect to disputes or
claims or controversies between or among the government-owned or
controlled corporations or entities being served by the Office of the
Government Corporate Counsel; and
(c) The Secretary of Justice, with respect to all other disputes or claims
or controversies which do not fall under the categories mentioned in
paragraphs (a) and (b).
Page | 4
was sanctioned under P.D. No. 242, which provided for the
administrative settlement of disputes between government offices,
agencies, and instrumentalities, including government-owned and
controlled corporations.37
Three days later, on 14 June 1991, PNB filed a Motion to Suspend
Proceedings before the CTA since it had a pending appeal before the
DOJ.38 On 04 July 1991, PNB filed with the CTA a Motion for
Reconsideration of its Order, dated 03 June 1991, submitting the case
for decision as of 04 June 1991, and prayed that the CTA hold its
resolution of the case in view of PNB's appeal pending before the DOJ. 39
On 17 July 1991, PNB filed a Motion to Suspend the Collection of Tax by
the BIR. It alleged that despite its request for reconsideration of the
deficiency withholding tax assessment, dated 16 January 1991, BIR
Commissioner Ong sent another letter, dated 23 April 1991,
demanding payment of the P294,958,450.73 deficiency withholding
tax on the interest earnings and/or yields from PNOC's money
placements. The same letter informed PNB that this was the BIR
Commissioner's final decision on the matter and that the BIR
Commissioner was set to issue a warrant of distraint and/or levy
against PNB's deposits with the Central Bank of the Philippines. PNB
further alleged that the levy and distraint of PNB's deposits, unless
restrained by the CTA, would cause great and irreparable prejudice not
only to PNB, a government-owned and controlled corporation, but also
to the Government itself.40
Pursuant to the Order of the CTA, during the hearing on 19 July 1991, 41
the parties submitted their respective Memoranda on PNB's Motion to
Suspend Proceedings.42
On 20 September 1991, private respondent Savellano filed another
Omnibus Motion calling the attention of the CTA to the fact that the BIR
already issued, on 12 August 1991, a warrant of garnishment
addressed to the Central Bank Governor and against PNB. In
compliance with the said warrant, the Central Bank issued, on 23
August 1991, a debit advice against the demand deposit account of
PNB with the Central Bank for the amount of P294,958,450.73, with a
corresponding transfer of the same amount to the demand deposit-intrust of BIR with the Central Bank. Since the assessment had already
been enforced, PNB's Motion to Suspend Proceedings became moot
Page | 5
undoubtedly be considered as matters arising from the NIRC and other
laws being administered by the BIR, thus, appealable to the CTA under
Section 7(1) of Rep. Act No. 1125.
P.D. No. 242 is a general law that deals with administrative settlement
or adjudication of disputes, claims and controversies between or
among government offices, agencies and instrumentalities, including
government-owned or controlled corporations. Its coverage is broad
and sweeping, encompassing all disputes, claims and controversies. It
has been incorporated as Chapter 14, Book IV of E.O. No. 292,
otherwise known as the Revised Administrative Code of the
Philippines.62 On the other hand, Rep. Act No. 1125 is a special law
dealing with a specific subject matter the creation of the CTA, which
shall exercise exclusive appellate jurisdiction over the tax disputes and
controversies enumerated therein. P.D. No. 242 should not affect Rep.
Act No. 1125. Rep. Act No. 1125, specifically Section 7 thereof on the
jurisdiction of the CTA, constitutes an exception to P.D. No. 242.
CIR v. JOSEFINA LEAL
G.R. No. 113459 November 18, 2002
FACTS: Pursuant to Section 116 of NIRC of 1977, as amended providing
for percentage tax on dealers in securities; lending investors. The
Commissioner
issued RMO No. 15-91 imposing 5% lending investors tax on
pawnshops, an offshoot of petitioners evaluation that the nature of
pawnshop business is akin to that of "lending investors," as defined
under the Tax Code. RMC No. 43-91 was subsequently issued
subjecting the pawn ticket to the documentary stamp tax as prescribed
by the Tax Code. Josefina Leal, owner and operator of Josefinas
Pawnshop in San Mateo, Rizal, asked for a reconsideration of the
issuances but the same was denied with finality. Consequently,
respondent filed with the RTC a petition for prohibition against the RMs.
Petitioner, filed a motion to dismiss on the ground that the RTC has no
jurisdiction to review and since it is in connection with the
implementation of the provisions of internal revenue laws, case falls
within the exclusive appellate jurisdiction of the CTA, citing Section 7
(1) of Republic Act No. 1125. The RTC, denied the motion. Petitioner
appealed to CA alleging that the RTC Judge acted without or in excess
Page | 6
(1) Decisions of the Commissioner of Internal Revenue in cases
involving disputed assessments, refunds of internal revenue taxes, fees
or other charges, penalties imposed in relation thereto, or other
matters arising under the National Internal Revenue Code or other laws
or part of law administered by the Bureau of Internal Revenue;
x x x x x x x x x." (emphasis added)
"SEC. 11. Who may appeal; effect of appeal. Any person, association
or corporation adversely affected by a decision or ruling of the
Commissioner of Internal Revenue, or the Commissioner of Customs or
any provincial or city Board of Assessment Appeals may file an appeal
in the Court of Tax Appeals within thirty days after the receipt of such
decision or ruling.
x x x x x x x x x." (emphasis added)
"SEC. 18. x x x. No judicial proceedings against the Government
involving matters arising under the National Internal Revenue Code,
the Customs Law or the Assessment Law shall be maintained, except
as herein provided, until and unless an appeal has been previously
filed with the Court of Tax Appeals and disposed of in accordance with
the provisions of this Act.
x x x x x x x x x." (emphasis added)
This Court, in Rodriguez, etc. vs. Blaquera, etc.,20 ruled:
"Plaintiff maintains that this is not an appeal from a ruling of the
Collector of Internal Revenue, but merely an attempt to nullify General
Circular No. V-148, which does not adjudicate or settle any controversy,
and that, accordingly, this case is not within the jurisdiction of the
Court of Tax Appeals.
"We find no merit in this pretense. General Circular No. V-148 directs
the officers charged with the collection of taxes and license fees to
adhere strictly to the interpretation given by the defendant to the
statutory provisions abovementioned, as set forth in the Circular. The
same incorporates, therefore, a decision of the Collector of Internal
Revenue (now Commissioner of Internal Revenue) on the manner of
enforcement of the said statute, the administration of which is
entrusted by law to the Bureau of Internal Revenue. As such, it comes
within the purview of Republic Act No. 1125, Section 7 of which
provides that the Court of Tax Appeals shall exercise exclusive
appellate jurisdiction to review by appeal x x x decisions of the
Collector of Internal Revenue in x x x matters arising under the
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Without first resolving the above issues, this Court finds that the
instant petition should be denied for being moot and academic. The
issues raised in the present petition, which merely involve the incident
on the preliminary injunction issued by the RTC, have already become
moot and academic considering that the trial court, in its decision on
the merits in the main case, has already ruled in favor of respondents
and that the same decision is now final and executory.
A perusal of the provisions would show that, while it is clearly stated
that the CTA has exclusive appellate jurisdiction over decisions, orders
or resolutions of the RTCs in local tax cases originally decided or