Case Digest (G.R. No. 120880)
Facts:
Ferdinand R. Marcos II v. Court of Appeals, G.R. No. 120880, June 05, 1997, the Supreme Court Second Division, Torres, Jr., J., writing for the Court. Petitioner Ferdinand R. Marcos II (the decedent's son) challenged actions of the Commissioner of the Bureau of Internal Revenue (BIR) and Herminia D. De Guzman (a BIR collection officer) after the BIR assessed alleged deficiency estate and income taxes against the estate of the late President Ferdinand E. Marcos and certain family members.The antecedent events, as adopted from the Court of Appeals' findings, began with the creation of a Special Tax Audit Team on June 27, 1990 that reported on July 26, 1991 the failure of the Marcoses to file estate and certain income tax returns. On July 26, 1991, the BIR issued several deficiency assessments: a deficiency estate tax assessment against the decedent's estate for P23,293,607,638.00, deficiency income tax assessments against spouses Ferdinand and Imelda Marcos for 1985–1986, and deficiency income tax assessments against petitioner for 1982–1985. The BIR avers assessments were served in August and September 1991; formal assessment notices were later served on October 20, 1992. No administrative protests were filed within the 30‑day period prescribed by law.
To collect, the BIR issued notices of levy on real property on February 22, 1993 and May 20–26, 1993, posted notices of sale on May 26, 1993, and conducted public auctions (the July 5, 1993 auction resulted in forfeiture to the government for lack of bidders). Petitioner also had an ongoing probate/special proceeding on the will of the late President (Sp. Proc. No. 10279, RTC Pasig, Branch 156) and there were various cases filed by government bodies (e.g., before the Sandiganbayan) challenging the late President's ownership of certain properties.
Petitioner filed a Petition for Certiorari and Prohibition under Rule 65 with the Court of Appeals on June 28, 1993, seeking annulment of the notices of levy and sale and injunctive relief against the auction. The Court of Appeals rendered a Decision on November 29, 1994 dismissing the petition, holding the assessments final and unappealable and upholding the BIR's use of summary tax remedies under Sections 205, 213 and related provisions of the National Internal Revenue Code (NIRC). Petitioner then brought the matter to the Supreme Court by a Petition for Review on Certiorari.
Petitioner urged that (A) the pendency of the probate proceeding placed the estate in custodia legis and precluded the BIR's summary levies; (B) the CA erred in declining to examine merits because the assessments were allegedly invalid or unreasonably enforced (claims including that levies were issued beyond the period allowed by Revenue Memorandum Circular No. 38‑68, th...(Subscriber-Only)
Issues:
- Does the pendency of the probate proceeding over the decedent's estate preclude the BIR from enforcing assessed estate and income taxes by summary remedies (levy and sale)?
- Were the deficiency assessments final and unappealable such that the BIR could collect by distraint/levy?
- Were the Notices of Levy and Notices of Sale void for being issued beyond the period allowed by Revenue Memorandum Circular No. 38‑68 (and related prescriptive rules)?
- Was there sufficient service of the notices of assessment, levy and sale to satisfy due process and statutory requirements?
- May the courts enjoin the BIR's collection by summary remedies in the circumstances of this case ...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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