Case Digest (G.R. No. 239464)
Facts:
Commissioner of Internal Revenue v. Court of Tax Appeals Third Division and Citysuper, Incorporated, G.R. No. 239464, May 10, 2021, Supreme Court Third Division, Leonen, J., writing for the Court.On April 1, 2013, the Commissioner of Internal Revenue (CIR) issued Letter of Authority No. 116-2013-00000017 authorizing audit of Citysuper, Inc. for taxable year 2011. On April 1, 2015 the CIR issued a Preliminary Assessment Notice alleging deficiencies (income tax, VAT, withholding on compensation, expanded withholding tax, and documentary stamp tax) totaling ₱2,083,016,072.43. Citysuper received the Formal Letter of Demand and Assessment Notices on April 24, 2015; on April 29, 2015 Citysuper sent a letter to the BIR stating it was "in the process of compiling the necessary documentation to support [its] protest."
Citysuper filed a Petition for Review with the Court of Tax Appeals (CTA) Third Division on August 13, 2015 under Rule 43. The parties litigated the issue of prescription: Citysuper moved for preferential resolution; petitioner moved to oppose; witnesses testified at hearings in 2016; Citysuper’s corporate secretary testified that a board resolution did not authorize Conchita V. Lee to waive prescription; Revenue Officer Rosario Arriola testified that Lee signed a waiver (dated July 10, 2014) which Officer-in-Charge Valeroso accepted on July 25, 2014, but Arriola lacked the authorization letter during her testimony. Cross-examination was continued and later partly waived after Citysuper’s counsel failed to appear; the purported authorization letter was not admitted in evidence.
On December 15, 2017 the CTA partially granted Citysuper’s petition: it set aside the Formal Letter of Demand dated April 24, 2015 and cancelled the assessment notices for deficiency income tax, VAT, withholding tax on compensation (WTC), and expanded withholding tax (EWT), but left the documentary stamp tax (DST) for full trial. The CTA concluded the waiver of prescription was not validly executed and that several assessed taxes had prescribed. The CIR moved for reconsideration arguing, inter alia, that the CTA lacked subject-matter jurisdiction because Citysuper never filed a valid administrative protest within the period and that the waiver was valid. In a March 20, 2018 Resolution the CTA denied reconsideration and held the CIR was estopped by laches—applying the Tijam doctrine—to contest CTA jurisdiction.
The CIR filed a Petition for Certiorari under Rule 65 with this Court on June 13, 2018, challenging (1) whether Rule 65 was the correct r...(Subscriber-Only)
Issues:
- Was a Rule 65 petition the correct remedy to assail the CTA’s December 15, 2017 and March 20, 2018 Resolutions?
- Did the CTA gravely abuse its discretion by finding the CIR barred by estoppel/laches from raising lack of subject-matter jurisdiction (application of Tijam)?
- Did the CTA gravely abuse its discretion in refusing to admit in evidence the authorization letter iss...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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