Case Digest (G.R. No. 280165)
Facts:
Commissioner of Internal Revenue and LT Collection Enforcement Agency v. Second Division of the Hon. Court of Tax Appeals and American Wire & Cable Co., Inc., G.R. No. 280165, August 04, 2025, Supreme Court Third Division, Inting, J., writing for the Court.Petitioners are the Commissioner of Internal Revenue (CIR) and the BIR LT Collection Enforcement Agency; respondents are the Second Division of the Court of Tax Appeals (CTA Division) and American Wire & Cable Co., Inc. (American Wire). The case arises from the CTA Division Resolutions dated December 27, 2024 and March 14, 2025 in CTA Case No. 11452, which allowed the suspension of collection of alleged deficiency taxes upon the posting of a cash or surety bond.
On February 26, 2024, American Wire received a Final Decision on Disputed Assessment (FDDA) demanding payment of deficiency value-added tax (VAT) of P30,164,500.83. Before the 30‑day period to appeal the FDDA to the CTA had lapsed, the CIR (through an authorized representative) issued a Warrant of Distraint and/or Levy (WDL) that was served on American Wire on March 22, 2024. On March 27, 2024—the last day of the 30‑day appeal period—American Wire filed a Petition for Review with the CTA Division, with an urgent motion (the “Motion to Suspend”) praying to lift the WDL and to suspend collection of the taxes.
The CTA Division required service of summons and the filing of an Answer, required the CIR to comment on the Motion to Suspend, conducted a hearing on the motion after receiving the CIR’s opposition, and required the CIR to comment on American Wire’s formal offer of evidence before submitting the motion for resolution. In its Resolution of December 27, 2024, the CTA Division granted the Motion to Suspend, enjoined the tax authorities from collecting the alleged VAT deficiency, and required American Wire to either file a cash bond equal to the principal amount or post a surety bond equivalent to 1.5 times that amount, citing CTA En Banc Resolution No. 02-2015. The CTA Division held in abeyance American Wire’s motion to lift the WDL pending final determination of the merits. The CTA Division explained that the CIR’s premature collection efforts before the 30‑day appeal period deprived American Wire of its statutory remedy and that under Revenue Memorandum Orders Nos. 011-14 and 035-19 collection may proceed only when an assessment is final and executory.
The CIR moved for reconsideration; the CTA Division denied the motion in its March 14, 2025 Resolution. The CIR, represented by BIR ...(Subscriber-Only)
Issues:
- Was the petition properly filed when the CIR and the BIR Litigation Division appeared before the Supreme Court without representation or deputation by the OSG, such that the petition is procedurally defective?
- Did the CTA Division commit grave abuse of discretion amounting to lack or excess of jurisdiction in granting American Wire’s Motion to Suspend collec...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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