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CIR v. BPI

This document summarizes a Supreme Court case from 2007 regarding tax assessments made by the Commissioner of Internal Revenue (CIR) against Benpres Holdings, Inc. (BPI) for deficiency percentage and documentary stamp taxes for 1986. The CIR assessed taxes against BPI in 1988, which BPI disputed. The Supreme Court ultimately ruled that BPI failed to properly protest the tax assessments within the required 30-day period, so the assessments became final. Thus, BPI was liable for the taxes assessed.

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213 views2 pages

CIR v. BPI

This document summarizes a Supreme Court case from 2007 regarding tax assessments made by the Commissioner of Internal Revenue (CIR) against Benpres Holdings, Inc. (BPI) for deficiency percentage and documentary stamp taxes for 1986. The CIR assessed taxes against BPI in 1988, which BPI disputed. The Supreme Court ultimately ruled that BPI failed to properly protest the tax assessments within the required 30-day period, so the assessments became final. Thus, BPI was liable for the taxes assessed.

Uploaded by

Ish
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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CIR v.

BPI
G.R. No. 134062 April 17, 2007
Facts:
In two notices dated October 28, 1988, CIR assessed BPI’s deficiency
percentage and documentary stamp taxes for the year 1986 in the total amount of
₱129,488,656.63. BPI sent a letter to CIR on December 10, 1988, through counsel,
stating that the earlier “deficiency assessments” are no assessments at all. BPI
received a letter from CIR dated May 8, 1991, stating that the letter sent by BPI
failed to qualify as a protest under Revenue Regulations. On July 6, 1991, BPI
requested a reconsideration of the assessments stated in the CIR’s May 8, 1991
letter; which was denied in a letter dated December 12, 1991.

On February 18, 1992, BPI filed a petition for review in the CTA, which was
dismissed due to lack of jurisdiction in a decision dated November 16, 1995. The CTA
ruled that BPI failed to protest on time under Section 270 of the National Internal
Revenue Code of 1986 and Section 7 in relation to Section 11 of RA 1126. CA reversed
the tax court’s decision and remanded the case to the CTA for a decision on the
merits. The CA ruled that the October 28, 1988 notices were not valid assessments
because they did not inform the taxpayer of the legal and factual bases therefor.

Issue:
Whether or not BPI was liable for the said taxes.

Held:
Yes. When the assessments were made pursuant to the former Section 270,
the only requirement was for the CIR to “notify” or inform the taxpayer of his
“findings”. Nothing in the old law required a written statement to the taxpayer of the
law and facts on which the assessments were bases.

BPI therefore had 30 days from the time it received the decision on June 27,
1991 to appeal but it did not. Instead it filed a request for reconsideration and lodged
its appeal in the CTA only on February 18, 1992. BPI’s failure to protest the
assessments within the 30-day period provided in the former Section 270 meant that
they became final and unappealable. Thus, the CTA correctly dismissed BPI’s appeal
for lack of jurisdiction. BPI was, from then on, barred from disputing the correctness
of the assessment or invoking any defense that would reopen that question of its
liability on the merits.

Taxes are the lifeblood of the government, for without taxes, the government
can neither exist nor endure. A principal attribute or sovereignty, the exercise of
taxing power derives its source from the very existence of the state whose social
contract with its citizen obliges it to promote public interest and common good. The
theory behind the exercise of the power to tax emanates from necessity; without
taxes, government cannot fulfill its mandate of promoting the general welfare and
well-being of the people.

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