REPUBLIC OF THE PHILIPPINES

DEPARTMENT OF JUSTICE
OFFICE OF THE CITY PROSECUTOR
Quezon City

BUREAU OF INTERNAL
REVENUE
Complainant,

Docket No. XV-03-INV-17G-

-versus- 07336

FOR: VIOLATION OF TAX

CODE

ALFONSO VELOSO DE
VEYRA, JR.,
Respondent.
x-----------------------------------------------------------------------------------------x

MOTION FOR RECONSIDERATION

[On the “Resolution” Dated 31 July 2018]

Respondent, by counsel, respectfully states:

Prefatory

Powers and functions of government agencies and

instrumentalities must be exercised with caution and in accordance
for the purpose for which it was made. Without this, the basic
constitutional safeguard that no person shall be deprived of his life,
liberty and property will not be observed and the government will be
deemed as the primary offender of this right.

Timeliness

1. On 19 September 2018, respondent received a copy of this

Honorable Office’s “Resolution”1 dated 31 July 2018. The assailed

1 Original duplicate copy of the resolution dated 31 July 2018.

 2

resolution rendered by Assistant Prosecutor Badua failed to consider

facts that may cause the dismissal of this complaint.

A copy of the assailed resolution dated 31 July 2018 is attached

as Annex “ 1.”

2. Pursuant to Section 56 of the “2008 Manual for

Prosecutors,”2 respondents are hereby granted ten (10) days to seek
for reconsideration of the assailed resolution. Considering
respondent’s receipt of the assailed resolution on 19 September 2018,
the instant motion is being filed on time.

Assignment of Error

I. The Office of the City Prosecutor failed to consider

that the Bureau of Internal Revenue (“BIR”) did not
present any evidence to prove that respondent is the
representative of the estate of Alfonso Mariano De
Veyra;

II. The Office of the City Prosecutor failed to consider

the fact that there is no showing that respondent is
the one obligated under law to produce the
requested documents in his capacity as custodian;

III. The Office of the City Prosecutor did not consider the
fact that BIR could no longer commence an
assessment against a taxpayer beyond the 3-year
prescriptive period.

IV. The Office of the City Prosecutor failed to consider

that respondent cannot be held criminally liable, as
he was exempt because his alleged failure to act is
due to an insuperable cause.

2 Section 56, Prosecutor’s Manual 2008.

 3

Arguments/Discussion

3. At the outset, it is a fact that BIR anchors its case of

violation of the subpoena on their belief that respondent is the
representative and/or as custodian of documents requested. The BIR
is gravely mistaken.

Respondent is not a
representative of the estate of the
deceased

4. Sec. 3, Rule 3 of the Rules of Court provides the rule on

representative as parties in an action. It states that, “A representative
may be xxx an executor or administrator.”3

5. Sec 4, on the other, hand, discusses how the estate shall be

administered. It states that when a will is allowed, the court shall
grant letters testamentary, or letters of administration xxx and such
letters testamentary or of administration, shall extend to all estate of
the testator xxx. It is, therefore, clear that if extrajudicial settlement or
self-adjudication is not possible, there is a need to appoint an
executor or administrator.

6. As contained in respondent’s counter-affidavit, Mr.

Alfonso Mariano De Veyra died intestate; hence, it is impossible for
him to name an executor. Further, the heirs of the deceased did not
institute intestate proceeding for the settlement of estate of the
deceased where an administrator of the estate may be granted by the
court.

BIR conveniently failed to

provide supporting documents to
substantiate their claim that
respondent is the representative
of the estate of the deceased either
as an executor or administrator.

7. Despite BIR’s claim that respondent is the estate’s

representative, the bureau did not bother to adduce supporting

3 Rules of Court, Sec. 3, Rule 3.

 4

documents showing respondent being named in a will as an executor

or adjudged by the court as administrator.

8. As to how BIR came up with the conclusion that

respondent is the representative of the estate remains questionable.
As shown from the chronological order of events, BIR could not even
ascertain as to who has the obligation under law to provide the
documents/records requested.

a. On the Letter of Authority (LOA)4, the respondent is not

named as representative of the estate. Instead, the estate is
named as subject of the LOA.

b. On the first5 and second6 notices to submit requested

records/documents, the respondent was likewise not named
as representative of the estate. Instead, the estate is named
as subject of the notices.

c. On the Subpoena Duces Tecum 7 issued by the BIR,

respondent, for the first instance, was named as
representative of the estate of Alfonso Mariano De Veyra.
However, BIR did not provide supporting documents to
justify its naming of respondent as representative of the
estate.

d. On the Recommendation of BIR8 to file action against

respondent, they again named respondent as representative
but, again, did not provide any supporting document to
support their claim that respondent is the representative of
the estate.

e. On the Joint Complaint-Affidavit9, the revenue officers

who prepared and attested to the document made a
recommendation to file a criminal action against respondent

4 Letter of Authority dated 7 August 2015 attached to Joint–Complaint Affidavit dated 31 July
2017 marked as Annex “A.”
5 First Notice dated 11 August 2015 attached to Joint–Complaint Affidavit dated 31 July 2017

marked as Annex “B.”

6 Second Notice dated 28 September 2015 attached to Joint–Complaint Affidavit dated 31 July

2017 marked as Annex “C.”

7 Subpoena Duces Tecum dated 14 January 2016 attached to Joint-Complaint Affidavit dated 31

July 2017 marked as Annex “D.”

8 Recommendation from BIR to file action dated 3 July 2017.
9 Joint Complaint-Affidavit dated 31 July 2017
 5

for alleged failure to produce the requested

documents/record. BIR simply named respondent as
representative of the estate without providing any
supporting document.

9. It is apparent from the records of the case that what BIR is

actually doing is to point its smoking barrel and fires it at whoever’s
expense.

BIR failed to prove that

respondent has custody over the
documents.

10. BIR insists on its power to issue subpoena by virtue of the

provision of NIRC which prescribes the power of the comissioner
“[T]o summon xxx any person having possession, custody, or care of
the books of accounts and other accounting records containing
entries relating to the business of the person liable for tax xxx.”10

11. Sweepingly, the BIR merely assumed that respondent has

custody over the documents. It must be emphasized that respondent
is not a manager of Fernwood in the sense that it has control over the
management of the business.

12. While it may be assumed that respondent manages

Fernwood as a business, it is a stretch of imagination to conclude that
he too is the appointed representative of the estate. As stated in the
complaint-affidavit itself, the father of the respondent excluded the
latter as a named person to manage Fernwood. The Management was
given to respondent’s four (4) other siblings as can be seen from the
special power of attorney executed by late De Veyra Sr.11

13. BIR’s purpose as to why respondent was named in the

Subpoena Duces Tecum as a person with authority and under
obligation to produce the documents/records when in fact, BIR is

10 NIRC, Section 5, Par. C. To summon the person liable for tax or required to file a return, or any
officer or employee of such person, or any person having possession, custody, or care of the
books of accounts and other accounting records containing entries relating to the business of the
person liable for tax, or any other person, to appear before the Commissioner or his duly
authorized representative at a time and place specified in the summons and to produce such
books, papers, records, or other data, and to give testimony;
11 Included as Annex “1” and “2” to the “Counter-Affidavit” dated 27 November 2015
 6

already in contact with the accounting department of Fernwood.

This is clear from the receiving copy of the first and second notices of
request to submit documents/records.

14. The notices sent by BIR lacks particularity, a matter that

should have caused the immediate dismissal of the complaint. In
Universal Rubber Products vs. CA 12, the Supreme Court ruled that
“the precise book, paper or document containing such evidence has
been so designated or described that it may be identified.” Quite
interestingly, the requested documents/records lack description as to
whether they pertain specifically to Fernwood as business or that of
the estate in general.

15. In BIR’s “Letter of Authority,” respondent was named as

representative of the estate. On the other hand, BIR claims that
respondent is the manager of Fernwood. Based on this alone, one
would ask: what documents should be submitted? Those of
Fernwood as business or that of the estate of the late Mr. Alfonso M.
De Veyra, Sr.?

16. The subpoena naming respondent as representative or

custodian of documents without clarity as to respondent’s capacity
should have rendered the entire BIR investigative process null and
void. In effect, the instant preliminary investigation should not have
even prospered.

On BIR’s reply-affidavit, it
accuses respodent that he did not
deny being an administrator of
the estate during the 28 January
2016 conference.

17. How can the respondent deny that he is the administrator

of estate when he is not present during the conference before the
Assistant Commissioner for Enforcement and Advocacy Service of
the BIR held on 28 January 2016?

18. Respondent was not present during the investigation.

The minutes of the meeting of the conference dated 28 January 2016

12 G.R. No. L-30266 June 29, 1984

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readily shows that respondent was not physically present. 13

Respondent is not a signatory in the minutes.

19. The absence of respondent during the conference is

supported by the fact that he is represented by Ms. Sharon Rose J.
Velarde (“Ms. Velarde”) who is a signatory to the Minutes of Meeting
of the conference.14 Ms. Velarde does not have authority to speak for
and on behalf of respondent on matters pertaining to his rights as one
of the heirs of the late Mr. Alfonso M. De Veyra, Sr. Ms. Velarde is
not privy to family matters relevant to the estated of the decedent. It
would thus be unfair for BIR to make such a sweeping assumption
that respondent failed to deny that he was the appointed
representative of the estate.

20. BIR cannot claim that they forgot to secure the signature
of respondent as an attendee in the meeting. Reason would dictate
that no person in his right mind would forget securing the signature
of the attendees. Especially when what traspired during a conference
may influence future actions and defenses of the parties against one
another.

21. BIR further played with its imagination when it invoked

Rule 130, Sec. 32 of the Rules of Court15 which provides that a person
is deemed to have admitted if a declaration was made in his presence
and yet failed to deny it. Surely, the invoked provision of the Rules
of Court finds no application in this case considering the foregoing.

22. These conflicting statements only prove uncertainty on

the part of BIR.

BIR allege that respondent never

denied in his letters that he is the
administrator or representative
of the deceased of the estate.

13 Par. 5 , Page 2, “Joint Complaint-Affidavit” dated 31 July 2018

14 Id.
15 An act or declaration made in the presence and within the hearing or observation of a party

who does or says nothing when the act or declaration is such as naturally to call for action or
comment if not true, and when proper and possible for him to do so, may be given in evidence
against him.
 8

23. The promt reply to the letters sent by BIR acknowleding

their wish to examine the accounting books and records are mere
gestures and to acknowledge the authority of the
bureau.Acknowledgment was given in order to accommodate BIR
and at least give the idea that the respondent together with his co-
heirs are willing to comply with BIR’s demand.

24. Further, it is natural for respondent to act promptly for he

has an inchoate interest over the subject estate. Prompt actions are
expected from the heirs in order to secure and protect their interests.

25. Given the purest intention, such timely reply to the letters
issued by BIR SHOULD NOT, in anyway, be interepreted
negatively. Also, it should not translate to respondent’s obligation
under law to produce documents/records requested.

Assuming that respondent,

indeed, is obligated under the law
to produce the requested
documents/records, BIR can only
make an assessment for taxable
years covered by the three (3) year
prescritive eriod

26. The subpoena requiring the administrator to submit

documents beginning 1 January 2006 until 31 December 2014 is
grossly erroneous. Pursuant to Section 203 of the NIRC of 1997,
internal revenue taxes shall be assessed within three (3) years after
the last day prescribed by law for the filing of the return, and no
proceeding in court without assessment for the collection of such
taxes shall be begun after the expiration of such period.

27. Prescinding from Section 203, complainant BIR’s

subpoena dated 7 August 2015 may require documents, and institute
actions therefrom, beginning 2012 and above only. Applying the 3-
year prescriptive period, the subpoena cannot demand documents
earlier earlier than 2012.

28. BIR’s issuance of a grossly defective subpoena violates

respondent’s constitutional right to due to process. It has arrogated
upon itself the authority to require the estate to submit documents
 9

way beyond the 3-year prescriptive as imposed by law. At the very

least, BIR should have amended its subpoena to cover only the
period as prescribed by the law.

29. To compel the estate, through respondent, to submit such

documents with full knowledge that they have acted beyond their
authority is the height of injustice. If only for this, BIR’s act of
engaging in what appears to be a fishing expedition should not be
tolerated by this Office. As such, the instant complaint lacks proper
basis.

The occurrence of a fortuitous

event must be considered. Article
12(7), in relation to Article 10, of
the Revised Penal Code is
applicable.

30. Sometime in July 2015, Fernwood experienced severe

flood brought about by tropical storm Egay which is the main reason
why respondent could no longer recover the documents. In fact, we
sought the help of the Punong Barangay of Culiat in order to drain
the water in the Fernwood’s basement office.16

31. To accommodate BIR in its request for the

documents/records respondent and Fernwood staff tried to retrieve
and reconstruct the documents requested by complainant BIR as
contained in its LOA. Unfortunately, however, fortuitous event such
as Egay would have made it impossible for anyone to recover such
voluminous documents. An attempt to reconstruct said documents
were made but despite persistent efforts, the same was next to
impossible.

32. Article 12(7), in relation to Article 10, of the Revised Penal

Code (“RPC”) finds application in the instant case. Pertinent
provisions of the RPC are quoted below, thus:

Article 10. Offenses not subject to the provisions of this Code. -

Offenses which are or in the future may be punishable
under special laws are not subject to the provisions of this

16Certification of the Punong Barangay of Culiat attached to Counter-Affidavit dated 9 October

2017 as Annex “3.”
 10

Code. This Code shall be supplementary to such laws,

unless the latter should specially provide the contrary.

xxxxx

Article 12. Circumstances which exempt from criminal

liability. - the following are exempt from criminal liability:

xxx

7. Any person who fails to perform an act required

by law, when prevented by some lawful insuperable
cause. (Underscoring ours)

33. Despite respondent’s sincere desire to assist complainant

BIR, typhoon Egay, a fortuitous event, destroyed all documents.
Needless to say, such an incident is beyond respondent’s control.
Consequently, respondent should not be held legally liable for such
failure to comply with BIR’s demand for documents.

Purpose and functions of

Preliminary investigation should
always be upheld and must be
given importance

34. In Callo-Claridad v. Esteban 17 , the Court had the

occasion to explain the purpose and objective of Preliminary
Investigation:

A preliminary investigation, according to Section

1, Rule 112 of the Rules of Court, is "an inquiry or
proceeding to determine whether there is sufficient
ground to engender a well-founded belief that a crime
has been committed and the respondent is probably
guilty thereof, and should be held for trial." xxx The
role and object of preliminary investigation were "to
secure the innocent against hasty, malicious, and
oppressive prosecutions, and to protect him from open
and public accusation of crime, from the trouble,

17 G.R. No. 191567, March 20, 2013

 11

expenses and anxiety of a public trial, and also to

protect the State from useless and expensive
prosecutions."

35. “Probable cause for purposes of filing a criminal

information is defined as such facts as are sufficient to engender a
well-founded belief that a crime has been committed and that the
respondent is probably guilty thereof. A finding of probable cause
needs only to rest on evidence showing that more likely than not a
crime has been committed, and that it was committed by the accused.
Probable cause, although it requires less than evidence justifying a
conviction, demands more than bare suspicion.”18

36. There is a clear mandate that findings of this Honorable

Office must be more than suspicion, thus, the need for supporting
documents in order to substantiate the allegation. However, this was
not met in this complaint.

37. Finding that the respondent should be subject to the

dreadful process of undergoing preliminary investigation and,
perhaps, trial, without validating the veracity of the allegation
amounts to a total disregard of a person’s to constitutional safeguard
that no person shall be deprived of his life, liberty or property
without due process of law. 19

38. In the case of Cabahug vs. People20, the Supreme Court

has held that:

We cannot overemphasize the admonition to

agencies tasked with the preliminary investigation and
prosecution of crimes that the very purpose of a
preliminary investigation is to shield the innocent from
precipitate, spiteful and burdensome prosecution. They
are duty-bound to avoid, unless absolutely necessary,
open and public accusation of crime not only to spare the
innocent the trouble, expense and torment of a public
trial, but also to prevent unnecessary expense on the part
of the State for useless and expensive trials. Thus, when

18 Id.
19 1987 Constitution, Art. 3, Sec. 1 - No person shall be deprived of life, liberty, or property
without due process of law, nor shall any person be denied the equal protection of the laws.
20 376 SCRA 113 (2002).
 12

at the outset the evidence cannot sustain a prima facie

case or that the existence of probable cause to form a
sufficient belief as to the guilt of the accused cannot be
ascertained, the prosecution must desist from inflicting
on any person the trauma of going through a trial. 21
(Emphasis supplied)

39. No less than the Supreme Court has spoken of the

importance of once reputation. As enunciated in the case of
Salvacion v. Sandiganbayan 22 “(t)he indelible stain upon
(respondent’s) name, which is never quite washed away by time,
should caution all concerned to a more careful and conscientious
scrutiny of all the facts before the finger is pointed and the stone is
cast.”23

Such horrific acts of BIR should

not be tolerated; the act of
naming a person as someone
obligated under law to provide
documents/records without
providing supporting document
should not be the norm.

40. The Office of the Prosecutor must not close it’s eyes to
these alleged normal practices on the part of the BIR. Allowing this
will open the floodgates for dishonesty and abuses. Further, to
tolerate these acts would make it convenient on the part of BIR to
hold someone answerable by simply naming a person as someone
responsible for the production of documents/records without
providing supporting document of his alleged responsibility.

41. All said, respondent respectfully asks that this Office

reconsider its earlier resolution and dismiss the case outright.

RELIEF

WHEREFORE, premises considered, respondent ALFONSO

VELOSO DE VEYRA, JR. respectfully prays that this Honorable

21 Id.
22 G.R. No. L-68633 July 11, 1986.
23 Ibid, at. 708.
 13

Office REVERSE its initial finding in its assailed “Resolution,” and

DISMISS the criminal information for violation of Tax Code.

Other reliefs, just or equitable under the premises, are likewise

prayed for.

Muntinlupa City for Quezon City, 1 October 2018.

LIM & YUTATCO-SZE LAW FIRM

Counsel for Respondent
Unit 901 ALPAP II Bldg.,
Trade St., cor. Investment Dr.,
Madrigal Business Park,
Bgy. Ayala Alabang, Muntinlupa City,
Tel. No. (02) 832-9628

By:

JUANITO R. LIM, JR.

PTR No. 2062789; 01/20/2017; Muntinlupa City
IBP Lifetime No. 012376; 01/20/2014; PPLM
MCLE Compliance No. V-0017782; 04/15/2016
Attorney’s Roll No. 54003

RAEMOND EDWARD A. MATEO

PTR No. 3119915; 08 / 26/ 2018; Muntinlupa City
IBP Chapter; PPLM
Admitted to the Bar 2018
Attorney’s Roll No. 70797

Copy furnished: (by registered mail)

Bureau of Internal Revenue

Complainant
Rm. 704, Prosecution Division,
7th Flr., BIR Nationall Office Building,
Diliman, Quezon City.
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VERIFICATION

I, ALFONSO VELOSO DE VEYRA, JR, of legal age, Filipino

and with postal address at, No. 69 Cenacle Drive, Sanville
Subdivision, Quezon City Philippines, and through undersigned
counsel at Unit 901 ALPAP II building, Trade St., cor. Investment
drive, Madrigal Business Park, Ayala Alabang, Muntinlupa City,
after having been sworn in accordance with law, hereby depose and
state:

1. I am the respondent in the above-entitled case;

2. I have caused the preparation of the foregoing “Motion

for Reconsideration”;

3. I have read and understood the contents thereof and that

the allegations therein are true and correct based on my
own personal knowledge and on authentic records in my
possession.

Affiant further sayeth naught.

IN WITNESS WHEREOF, I have hereunto affixed my signature

this 1st day of October 2018 in the City of ____________.

__________________________________
ALFONSO VELOSO DE VEYRA, JR
Affiant

SUBSCRIBE AND SWORN to before me this 1st day of October

2018 in the City of ___________, affiant exhibiting to me his
_______________________.
 15

Doc. No. ___; NOTARY PUBLIC

Page No. ___;
Book No. ___;
Series of 2018.

EXPLANATION
(Pursuant to Section 11, Rule 13 of the 1997 Rules of Civil Procedure)

Copies of this “Motion for Reconsideration”are being served to

the parties by registered mail due to far distance and lack of sufficient
personnel in the office of the undersigned.

RAEMOND EDWARD A. MATEO