Case Digest (G.R. No. 178797)
Facts:
Metropolitan Bank and Trust Co. v. Commissioner of Internal Revenue, G.R. No. 178797, August 04, 2009, Supreme Court Third Division, Chico‑Nazario, J., writing for the Court.Petitioner Metrobank, a domestic banking institution, offered a product called the Universal Savings Account (UNISA): a passbook‑evidenced special savings account that pays a preferential (higher) interest rate to depositors who maintain a minimum balance for a specified holding period, but which otherwise permits withdrawals and reverts to a regular savings account if the holding requirement is not met. Pursuant to Letter of Authority No. LOA 2000 00052501 (26 June 2001), the Bureau of Internal Revenue (BIR) examined Metrobank’s tax liabilities for 1999 and, by Pre‑Assessment Notice (30 September 2002) and Assessment No. DST‑2‑99‑000022 (7 January 2003), assessed Metrobank for deficiency Documentary Stamp Tax (DST) computed on the gross UNISA deposits for 1999, amounting (with increments) to roughly P477.6 million.
Metrobank protested the assessment administratively (protest filed 17 January 2003). The Commissioner of Internal Revenue (CIR) denied the protest in a Decision dated 2 March 2004 ordering payment of the assessed amount. Metrobank filed a Petition for Review with the Court of Tax Appeals (CTA), docketed C.T.A. No. 6955. The CTA Second Division dismissed Metrobank’s petition in a Decision dated 1 September 2006 (modified to cancel the compromise penalty), and denied reconsideration on 3 January 2007. Metrobank elevated the matter to the CTA en banc by petition; the CTA en banc affirmed the Second Division in a Decision promulgated 21 May 2007 and denied reconsideration on 9 July 2007. The CTA en banc relied on this Court’s contemporaneous rulings in Banco de Oro Universal Bank v. Commissioner of Internal Revenue (BDO case, G.R. No. 173602, Resolution, 15 January 2007) and International Exchange Bank v. Commissioner of Internal Revenue (IEB case, G.R. No. 171266, Decision, 4 April 2007), which held that passbook‑evidenced special savings accounts having fixed‑term features are equivalent to certificates of deposit bearing interest and thus subject to DST under Section 180 of the National Internal Revenue Code (NIRC) as then worded.
Metrobank brought a petition for review under Rule 45 to this Court raising the sole substantive question whether the UNISA was subject to DST under Section 180 of the NIRC prior to its amendment by Republic Act No. 9243 (which took effect 20 May 2004). While the Rule 45 petition was pending, Metrobank filed a Manifestation (17 April 2008) informing the Court it had availed itself of the tax amnesty under Republic Act No. 9480 (lapsed into law 24 May 2007) and paid the amnesty tax; Metrobank claimed the amnesty extinguished tax liabilities for taxable years 2005 and prior, including the deficiency DST for 1999. The CIR opposed, arguing (inter alia) that Metrobank was merely a withholding agent and thus excluded under RA 9480 Section 8(a), that the assessment had become final and therefore excluded by Section 8(f), and that deficiency DST was not covered by the amnesty. The CTA en banc in a separate docket (C.T.A. EB No. 269) had already found Metroban...(Subscriber-Only)
Issues:
- Was Metrobank’s Universal Savings Account (UNISA), evidenced by a passbook, subject to Documentary Stamp Tax under Section 180 of the NIRC for taxable year 1999 (i.e., prior to amendment by R.A. No. 9243)?
- Did Metrobank’s availment of the Tax Amnesty Program under Republic Act No. 9480 extinguish its liability for the assessed deficiency DST for 1999 (notwithstanding the CIR’s contentions that Metrobank was a withholding agent, that the assessment was final, or that de...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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