G.R. No. L-10609 - People vs. Ching Lak alias Ang You Chu

On or about February 17, 1948, the defendant-appellee was accused of willfully and unlawfully failing to pay his war profits tax amounting to P33,643.65 in violation of Section 5(b) in connection with Section 8 of Republic Act No. 55.
Prior to the alleged non-payment, on May 22, 1947, Collector Bibiano L. Meer of the Bureau of Internal Revenue issued an assessment for a war profits tax of P219,842.00, setting a payment deadline of June 15, 1947.
On June 4, 1947, the defendant, through his counsel Atty. Modesto Formilleza, formally contested the assessment by sending a letter to the Collector of Internal Revenue.

After the filing of the criminal information on March 31, 1954, the defendant was arraigned with the assistance of his counsel and entered a plea of not guilty.
The defendant subsequently filed a motion to quash the information on the ground that the criminal liability had been extinguished by prescription, given that more than five years had elapsed from either the alleged violation date or the applicable deadline for payment.
The lower court, presided over by Hon. Antonio G. Lucero, sustained the motion upon a proper hearing, holding that the offense had prescribed under the prescriptive periods set by the applicable legislation.

Section 5(b) mandates that the full tax amount be paid within the prescribed period, failing which a surcharge and interest would accrue.
Section 8 provides the penalty for non-payment, prescribing imprisonment and/or a fine.

The execution of Republic Act No. 55 was entrusted to the Collector of Internal Revenue as indicated in its provisions.
The prescriptive period governing the offense is derived from Acts 3326 and its amendment by Act 3585, which explicitly states that all offenses against any law or part of law administered by the Bureau of Internal Revenue prescribe after five years.
Although the Revised Penal Code contains guidelines on prescription in Articles 90 and 91, Article 10 of the Revised Penal Code excludes offenses punishable under special laws, thus making those articles inapplicable in this case.

The defense maintained that the offense was already prescribed, citing the lapse of five years from the alleged date of violation (or from the last possible payment deadline) to the filing of the information.
The prosecution, represented by the Solicitor General, argued on three main points:

That the Revised Penal Code’s prescription provisions should apply.
That the offense was a continuing one, and hence the prescription period should not have been computed as already lapsed.
That the prescriptive period should commence from the time the tax violation was referred to the Fiscal’s Office for investigation.

The Solicitor General also relied on the decision in Lattimore vs. U.S. to suggest suspension of the prescriptive period due to procedural acts by the accused; however, this was acknowledged as applicable only in matters of tax collection rather than in criminal prosecution.

Whether the prescriptive period for the criminal action should be based on the provisions of the Revised Penal Code (Articles 90 and 91) or on the special law as amended by Act 3585.
The issue of whether Republic Act No. 55, being a special law administered by the Collector of Internal Revenue, falls under the purview of Act 3585 prescribing a five-year period.

Whether the offense charged in the information constitutes a continuing offense or a complete violation that warrants immediate prosecution.
The implications of labeling the offense as continuing on the computation of the prescriptive period.

Whether the defendant’s actions, including contesting the tax assessment and filing a petition for reconsideration, effectively suspended or interrupted the running of the prescriptive period for criminal prosecution.
Whether the arguments citing administrative proceedings (as in Lattimore) are applicable to a criminal case.