SECOND DIVISION
G.R. No. 216161, August 09, 2017
COMMISSIONER OF INTERNAL REVENUE, Petitioner, v. PHILIPPINE ALUMINUM WHEELS, INC., Respondent.
D E C I S I O N
CARPIO, J.:
The Case
Before the Court is a petition for review on certiorari1 assailing the 19 May 2014 Decision2 and the 5 January 2015 Resolution3 of the Court of Tax Appeals (CTA) En Banc in CTA EB No. 994.
The CTA En Banc affirmed the Decision of the CTA First Division ordering the cancellation and withdrawal of the deficiency tax assessments issued by the Commissioner of Internal Revenue (CIR) against Philippine Aluminum Wheels, Inc. (respondent).
WHEREFORE, premises considered, the instant Petition for Review is GRANTED. The subject assessment in the present case against petitioner is hereby SET ASIDE solely in view of petitioner's availment of the Tax Amnesty Program under R.A. No. 9480; and accordingly, petitioner is hereby DECLARED ENTITLED to the immunities and privileges provided by the Tax Amnesty Law being a qualified tax amnesty applicant and for having complied with all the documentary requirements set by law.The CIR filed a Motion for Reconsideration14 on 3 December 2012 which the CTA First Division denied on 1 March 2013.15
SO ORDERED.13
WHEREFORE, premises considered, the Petition for Review filed by the Commissioner of Internal Revenue is DENIED, for lack of merit. The Decision of the First Division of this Court promulgated on November 12, 2012 in CTA Case No. 781[7], captioned Philippine Aluminum Wheels, Inc. v. Commissioner of Internal Revenue, and the Resolution of the said Division dated March 1, 2013, are AFFIRMED in toto.The CIR filed a Motion for Reconsideration on 11 June 2014 which was denied on 5 January 2015.17
SO ORDERED.16
Section 1. Coverage. There is hereby authorized and granted a tax amnesty which shall cover all national internal revenue taxes for the taxable year 2005 and prior years, with or without assessments duly issued therefor, that have remained unpaid as of December 31, 2005: Provided, however, that the amnesty hereby authorized and granted shall not cover persons or cases enumerated under Section 8 hereof.The Department of Finance issued DOF Department Order No. 29-07 (DO 29-07).19 Section 6 of DO 29-07 provides for the method for availing a tax amnesty under RA 9480, to wit:
x x x x
Section 6. Immunities and Privileges. Those who availed themselves of the tax amnesty under Section 5 hereof, and have fully complied with all its conditions shall be entitled to the following immunities and privileges:(a) The taxpayer shall be immune from the' payment of taxes, as well as additions thereto, and the appurtenant civil, criminal or administrative penalties under the National Internal Revenue Code of 1997, as amended, arising from the failure to pay any and all internal revenue taxes for taxable year 2005 and prior years.
x x x x (Emphasis supplied)
Section 6. Method of Availment of Tax Amnesty.In Philippine Banking Corporation v. Commissioner of Internal Revenue,20 this Court held that the taxpayer's completion of the requirements under RA 9480, as implemented by DO 29-07, will extinguish the taxpayer's tax liability, additions and all appurtenant civil, criminal, or administrative penalties under the National Internal Revenue Code, to wit:
1. Forms/Documents to be filed. To avail of the general tax amnesty, concerned taxpayers shall file the following documents/requirements:
a. Notice of Availment in such forms as may be prescribed by the BIR;
b. Statement of Assets, Liabilities and Networth (SALN) as of December 31, 2005 in such forms, as may be prescribed by the BIR;
c. Tax Amnesty Return in such forms as may be prescribed by the BIR.
2. x x x.
3. x x x.
The Acceptance of Payment Form, the Notice of Availment, the SALN, and the Tax Amnesty Return shall be submitted to the RDO, which shall be received only after complete payment. The completion of these requirements shall be deemed full compliance with the provisions of RA 9480.
x x x x (Emphasis supplied)
Considering that the completion of these requirements shall be deemed full compliance with the tax amnesty program, the law mandates that the taxpayer shall thereafter be immune from the payment of taxes, and additions thereto, as well as the appurtenant civil, criminal or administrative penalties under the NIRC of 1997, as amended, arising from the failure to pay any and all internal revenue taxes for taxable year 2005 and prior years.21Similarly, in Metropolitan Bank and Trust Company (Metrobank) v. Commissioner of Internal Revenue,22 this Court sustained the validity of Metrobank's tax amnesty upon full compliance with the requirements of RA 9480. This Court ruled: "Therefore, by virtue of the availment by Metrobank of the Tax Amnesty Program under Republic Act No. 9480, it is already immune from the payment of taxes, including DST on the UNISA for 1999, as well as the addition thereto."23
Section 8. Exceptions. The tax amnesty provided in Section 5 hereof shall not extend to the following persons or cases existing as of the effectivity of this Act:The CIR is wrong. Section 8(f) is clear: only persons with "tax cases subject of final and executory judgment by the courts" are disqualified to avail of the Tax Amnesty Program under RA 9480. There must be a judgment promulgated by a court and the judgment must have become final and executory. Obviously, there is none in this case. The FDDA issued by the BIR is not a tax case "subject to a final and executory judgment by the courts" as contemplated by Section 8(f) of RA 9480. The determination of the tax liability of respondent has not reached finality and is still not subject to an executory judgment by the courts as it is the issue pending before this Court. In fact, in Metrobank, this Court held that the FDDA issued by the BIR was not a final and executory judgment and did not prevent Metrobank from availing of the immunities and privileges granted under RA 9480, to wit:
(a) Withholding agents with respect to their withholding tax liabilities;
(b) Those with pending cases falling under the jurisdiction of the Presidential Commission on Good Government;
(c) Those with pending cases involving unexplained or unlawfully acquired wealth or under the Anti-Graft and Corrupt Practices Act;
(d) Those with pending cases filed in court involving violation of the Anti-Money Laundering Law;
(e) Those with pending criminal cases for tax evasion and other criminal offenses under Chapter II of Title X of the National Internal Revenue Code of 1997, as amended, and the felonies of frauds, illegal exactions and transactions, and malversation of public funds and property under Chapters III and IV of Title VII of the Revised Penal Code; and
(f) Tax cases subject of final and executory judgment by the courts. (Emphasis supplied)
x x x. As argued by Metrobank, the very fact that the instant case is still subject of the present proceedings is proof enough that it has not reached a final and executory stage as to be barred from the tax amnesty under Republic Act No. 9480.The CIR alleges that respondent is disqualified to avail of the Tax Amnesty Program under Revenue Memorandum Circular No. 19-2008 (RMC No. 19-2008) dated 22 February 2008 issued by the BIR which includes "delinquent accounts or accounts receivable considered as assets by the BIR or the Government, including self-assessed tax" as disqualifications to avail of the Tax Amnesty Program under RA 9480. The exception of delinquent accounts or accounts receivable by the BIR under RMC No. 19-2008 cannot amend RA 9480. As a rule, executive issuances including implementing rules and regulations cannot amend a statute passed by Congress.
The assertion of the CIR that deficiency DST is not covered by the Tax Amnesty Program under Republic Act No. 9480 is downright specious.25
Endnotes:
1Rollo, pp. 10-24. Under Rule 45 of the Rules of Court.
2 Id. at 29-40. Penned by Associate Justice Ma. Belen M. Ringpis-Liban, with Presiding Justice Roman G. Del Rosario and Associate Justices Juanito C. Castaneda Jr., Lovell R. Bautista, Esperanza R. Fabon-Victorino, Cielito N. Mindaro-Grulla, and Amelia R. Cotangco-Manalastas concurring. Associate Justices Erlinda P. Uy and Caesar A. Casanova were on leave.
3 Id. at 41-43.
4 Id. at 44-52.
5 Id. at 53-60.
6 Id. at 61-65.
7 Id. at 66.
8 Id. at 67.
9 Id. at 68.
10 Id. at 69.
11 Id. at 137.
12 Id. at 146.
13 Id. at 146-147.
14 Id. at 148-202.
15 Id. at 203-206.
16 Id. at 39.
17 Id. at 43.
18Commissioner of Internal Revenue v. Marubeni Corporation, 423 Phil. 862, 874 (2001).
19 Rules and Regulations to Implement Republic Act No. 9480. Issued on 15 August 2007.
20 597 Phil. 363 (2009).
21 Id. at 388.
22 612 Phil. 544 (2009).
23 Id. at 573.
24 695 Phil. 852 (2012).
25Metropolitan Bank and Trust Company v. Commissioner of Internal Revenue, supra note 22, at 569.
26 370 Phil. 793 (1999).