Case Digest (G.R. No. 202105)
Facts:
In La Flor Dela Isabela, Inc. v. Commissioner of Internal Revenue (G.R. No. 202105, April 28, 2021), petitioner La Flor Dela Isabela, Inc. (“La Flor”) challenged before the Court of Tax Appeals En Banc (CTA) the validity of deficiency tax assessments and an undated Warrant of Distraint and/or Levy (WDL) issued by respondent Commissioner of Internal Revenue (“CIR”) for taxable year 1999. On September 6, 2000, the CIR secured a Letter of Authority to audit La Flor’s books for 1999, prompting La Flor to execute five successive waivers of the statute of limitations extending the assessment period. The periods purportedly extended by these waivers ranged from December 1, 2002 to June 30, 2005, although several waivers were notarized or accepted after expiry of prior waivers and bore no clear dates of acceptance by the CIR or its duly authorized representatives. On March 14, 2005, La Flor received a Formal Letter of Demand (FLD) attaching four assessments: deficiency income tax, valueCase Digest (G.R. No. 202105)
Facts:
- Examination and Assessments
- On September 6, 2000, the CIR issued a Letter of Authority covering La Flor’s 1999 tax period. La Flor executed five waivers of the statute of limitations:
- First Waiver (May 28, 2002 to Dec. 1, 2002)
- Second Waiver (Oct. 2, 2002 to June 30, 2003), notarized Nov. 4, 2002
- Third Waiver (Apr. 11, 2003 to Dec. 31, 2003), submitted Apr. 14, 2003
- Fourth Waiver (Jan. 6, 2004 to Dec. 31, 2004)
- Fifth Waiver (Nov. 4, 2004 to June 30, 2005)
- On March 14, 2005, La Flor received a Formal Letter of Demand with deficiency assessments for income tax, VAT, withholding tax on compensation, and compromise penalty. La Flor filed its protest on March 30, 2005 and a supplemental protest on April 12, 2005.
- On July 9, 2007, the CIR issued its Final Decision on Disputed Assessments (FDDA), totaling ₱10,460,217.23. La Flor then applied for tax amnesty (Oct. 8, 2007) and compromise (Oct. 18, 2007). On November 23, 2007, an undated Warrant of Distraint and/or Levy (WDL) was issued.
- Judicial Proceedings
- La Flor filed a Petition for Review with the CTA Division on Nov. 29, 2007. The CTA Second Division dismissed it on June 9, 2010 for late filing beyond the 30-day period from the FDDA. A motion for reconsideration was denied on Aug. 4, 2010.
- La Flor elevated the case to the CTA En Banc. On Feb. 2, 2012, the CTA En Banc denied the petition, ruling the waivers valid and the petition filed beyond the 30-day reglementary periods. A motion for reconsideration was denied on May 24, 2012.
Issues:
- Whether the CTA erred in not ruling the assessment and WDL null and void.
- Whether La Flor’s tax amnesty under RA 9480 absolved its IT and VAT deficiencies.
- Whether La Flor is liable for the compromise penalty.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)