Case Summary (G.R. No. 216161)
Factual Background
The respondent, engaged in manufacturing automotive parts, was subjected to a Preliminary Assessment Notice (PAN) and subsequently a Final Assessment Notice (FAN) for the taxable year 2001, which totaled P32,100,613.42. After a period of appeals and discussions regarding payments and tax amnesty, the Bureau of Internal Revenue (BIR) maintained its stance on the finality of the Final Decision on Disputed Assessment (FDDA) issued against the respondent. The company sought to avail itself of tax amnesty, complying with the requirements set out in RA 9480, yet faced denial from the BIR based on alleged failures to appeal within the designated timeframe.
Decision of the Court of Tax Appeals (CTA) First Division
Initially, the CTA First Division ruled in favor of the respondent, voiding the deficiency tax assessment on the grounds of the respondent’s successful compliance with the tax amnesty requirements detailed in RA 9480. The court held that the law provided immunity from certain tax liabilities for those who adhered to the guidelines of the Tax Amnesty Program, thus granting the respondent rights to such benefits.
Decision of the CTA En Banc
The CTA En Banc upheld the First Division’s decision, asserting that a qualified applicant who strictly fulfills the amnesty prerequisites is immune from tax payments and penalties under the National Internal Revenue Code. It clarified that the mere finality of a tax assessment did not preclude a party from participating in the program, reaffirming the taxpayer's rights provided they meet established conditions.
Legal Issue Presented
The primary legal issue was whether the respondent was entitled to the benefits of the Tax Amnesty Program under RA 9480, especially in light of the BIR’s assertions regarding the finality of the assessments.
Analysis of Tax Amnesty Legal Framework
RA 9480 grants a comprehensive tax amnesty covering all unpaid national internal revenue taxes for the years prior to 2005. Under this law, individuals or entities that adhere to specific compliance protocols are entitled to immunity from past dues as well as penalties. The law is construed in a manner favoring the taxpayer if they meet requirements but is strictly interpreted against taxpayers who fail to comply.
Application of Law to Facts
The respondent availed itself of the Tax Amnesty Program, submitting necessary documentation and making required payments. The court emphasized that the BIR's claim that the FDDA constituted a “final and executory judgment” was incorrect, as the determination of tax liability was not adjudicated by a court nor had it reached a definitive conclusion. Hence, the respondent retained the right to participate in the tax amnesty.
Bureau of Internal Revenue's Position
The CIR contended that the respondent's claimed participation in the Tax Amnesty Program was disallowed
...continue readingCase Syllabus (G.R. No. 216161)
Case Overview
- The case involves a petition for review on certiorari filed by the Commissioner of Internal Revenue (CIR) against Philippine Aluminum Wheels, Inc. (respondent).
- The Court of Tax Appeals (CTA) En Banc affirmed the First Division's decision that ordered the cancellation of the deficiency tax assessments against the respondent.
- The decisions were rendered on 19 May 2014 and 5 January 2015.
Background Facts
- Philippine Aluminum Wheels, Inc. is a corporation engaged in the manufacture and distribution of automotive parts.
- On 16 December 2003, the Bureau of Internal Revenue (BIR) issued a Preliminary Assessment Notice (PAN) for deficiency taxes for the year 2001.
- This was followed by a Final Assessment Notice (FAN) dated 28 March 2004, amounting to P32,100,613.42.
- The respondent filed for reconsideration on 23 June 2004, leading to a Final Decision on Disputed Assessment (FDDA) issued by the BIR on 8 November 2006, which demanded full payment.
Procedural History
- The FDDA was served on 12 April 2007, and on 19 July 2007, the respondent applied for tax abatement under Revenue Regulations No. 13-2001.
- The BIR denied the application on 12 September 2007, asserting the FDDA had become final due to the respondent's failure to appeal within the 30-day period.
- Meanwhile, the respondent informed the BIR of partial payments and its intenti