G.R. No. 32652 - People vs. Tan Boon Kong

The defendant, Tan Boon Kong, was charged as the manager of the Visayan General Supply Co., Inc.
The information alleges that during all four quarters of 1924, the defendant, in his capacity as manager, made a false return for purposes of taxation by declaring sales receipts amounting to ₱2,352,761.94 when the actual gross sales of the corporation totaled ₱2,543,303.44.
As a result, an undeclared amount of ₱190,541.50 existed, and the corresponding internal-revenue percentage tax of ₱2,960.12 (1½ percent on the undeclared sales) was not paid.

Section 1458 of Act No. 2711 requires every person conducting a business subject to percentage taxes to make a true and complete return of the earnings for each quarterly period.
Section 2723 of Act No. 2711 penalizes any person who fails to make a return or makes a false or fraudulent return, thereby imposing criminal liability through fines and/or imprisonment.

The judge of the Twenty-third Judicial District sustained a demurrer to the information on the ground that the alleged offense was a corporate act rather than an act committed personally by its officer.
The ruling was rooted in the interpretation that a corporation, as a separate legal entity, was responsible for the offense, not its manager or agent.

The case cites authorities supporting the principle that a corporation acts only through its officers and agents (e.g., Grail and Ostrander’s Case, 103 Va., 855).
In State vs. Burnam (71 Wash., 199), the court held that a manager could be criminally liable for the offenses committed by the corporation, even if not physically present when the offense occurred.

The central issue is whether the defendant, by virtue of being the author of the false return, is personally liable for the criminal offense under section 2723 of Act No. 2711 despite the offense being executed by the corporation.
The allegations, if proven, establish that the defendant directly participated in an illegal act by submitting a fraudulent return affecting the tax liabilities of the corporation.

Whether the information sufficiently sets forth facts that render the manager personally liable, as opposed to the corporation alone, for the violation of section 1458 and the consequent offense under section 2723 of Act No. 2711.
Whether the established legal doctrine—that a corporation acts only through its officers and agents—mandates that all participants, including managers responsible for submitting returns, should be held criminally liable for any illegal acts carried out in the course of the business.
Whether the participation of the defendant in the filing of a false return justifies reversing the lower court’s decision, which sustained the demurrer based on the belief that the offense was solely attributable to the corporation.