THE Court of Tax Appeals (CTA) affirmed the cancellation of tax assessment on Grand Plaza Hotel Corp. for 2008 worth P506 million.
In a resolution dated Jan. 19, the court, sitting en banc, denied for lack of merit the appeal of the Bureau of Internal Revenue (BIR).
The BIR claimed that while there is no disputed assessment, the en banc erred in ruling that the court in division assumed jurisdiction over the company’s petition. It was also filed out of time, even if it falls under “other matters,” the bureau said.
It also claimed that the court should not have declared void the deficiency tax assessment for allegedly not containing a definite due payment.
“Petitioner’s contentions are mere reiterations of the arguments he has raised in his “Petition for Review.” Moreover, these issues have been amply considered, weighed and resolved in the Assailed Decision. Thus, to discuss anew the explanation of the Court on these matters is superfluity,” the court said.
“In sum, the Court En Banc finds no cogent reason to warrant a reconsideration of the Assailed Decision,” it added.
The company in its comment also said that the arguments raised were a rehash of the claims raised both in the en banc and the division, the court said.
The court in its decision on Sept. 29, 2020 upheld the decision of its special second division in October 2018 and resolution in March 2019 cancelling the tax assessment against Grand Plaza.
The en banc ruled that the court in division “properly assumed and exercised jurisdiction over the case,” noting that its jurisdiction of those falling under “other matters” clause under the Tax Code include determination of validity of a warrant of distraint and levy and prescription of the bureau’s right to collect taxes.
The court noted in the decision that the company’s basis in filing a petition for review was the issuance of the Final Notice, which was meant to enforce collection of the alleged tax liabilities.
It was received by the company on Feb. 16, 2015 and filed the petition to the court on Feb. 20, which is within the prescribed period to question the issuance.
The court also said that the assessment is void due to the lack of a “definite and unequivocal demand for payment on a certain due date.”
It cited a Supreme Court ruling which stated that an assessment must not only contain the computation of the tax liabilities, but also a demand for payment within a prescribed period.
The High Court also said that the lack of a certain date “negates BIR’s demand for payment,” the CTA said.
Associate Justice Jean Marie A. Bacorro-Villena dissented in the Sept. 29 decision, saying the court has no jurisdiction over the original petition for review filed at the division as a formal letter of demand (FLD) was received as early as Sept. 19, 2013 and the company partially paid its tax. The petition should have been filed within 30 days from the receipt of the FLD, she said in her dissenting opinion.
The division in July 2018 initially dismissed the petition of the company for lack of jurisdiction since the assessment in question had become final for its failure to file a protest against the formal letter of demand within the prescribed period.
In the amended decision in October 2018, the court’s division found merit in the appeal of the company, saying that while there is no disputed assessment, it can assume jurisdiction over the petition under “other matters” clause of the Tax Code. It said that the court may review the BIR’s right to collect upon assessment. — Vann Marlo M. Villegas