REPUBLIC OF THE PHILiPPINES

COURT OF TAX APPEALS

QUEZON CITY

...

:;

HANTEX TRADING CO., INC.,

Petitioner,
C.T.A. CASE NO. 5126

- versus -

COMMISSIONER
REVENUE,

OF INTERNAL

Promulgated:

Respondent.

_D_EC_1_1_19_97_-i::-j
-

-,"-

DECISION
The issue
is

whether or

against

which is

presented for our

not

assessments made

petitioner

the
have

valid

and

and

and

sales taxes,

respondent
bases,

thus

the amounts of

as deficiency

~14,752,903.28,

respectively,

by

legal

making the latter liable to pay the former

~13,414,226.40

consideration

plus interest

income

that

may

accrue thereon until actual payment of the same.

Petitioner is

a registered general partnership

organized and existing

under the laws of the

and is engaged in the importation of

210, BIR records).
that

the

1987

Acting on a confidential
importations

understated in its

Intelligence

went

the

conduct

an

business

and

the

prod~ts

on

of
its

the
1987

(p.

information
were

petitioner

Investigation

premises

investigation

pursuant to Mission

of

Philippines

accounting records, the agents of

Economic
to

plastic

duly

Bureau

the

(EIIB)

petitioner

to

transactions

Order No. 398-89, dated November

14,

DECISION C.T.A. CASE NO. 5126

-

1989.

In

their

agents reported
persuaded

to

open

in a

"

evidence

its books

to them and
way

records

they resorted

method, there

was found

of

P63,032,989.17,

EIIB

agents

the

F-68.

that

in

non-recording

of the

Chief,

Collection

Container

duties

and

Port, dated

August

Chief, Collection Division,

22, 1990.

entries filed by
marked

EIIB

from the

were

al.so

used

as

liabilities of

duly

thereon,

of

Manila

7,,

1990, and

by

its

...,

the

Acting

Port of Manila, dated

August

the Commissioner of

and Exchange

evidence

petitioner.

the

International

statements

which was secured by the agents

Securities

as

report, the

Duly certified copies of financial

of the petitioner

EIIB

and released after

taxes due

Division

by

(purchases).

entries

authenticated as having been processed

payment

best

unreported sales

of Customs,

these

the

By

In the same memorandum

declared

the

the agents of the

Bureau

be

NIRC.

thru

evidence referred to by

Annexes F-1 to

to

of its 1987 importations

petitioner with

EIIB

petitioner

Section 16,

were the different copies of consumption

the

the

despite

since the herein

hostile,

petitioner of some
The best

and

under

amount

(Exh. F),

petitioner could not

obtainable method

using this
the

memorandum report
that the herein

authority given
becomes

2 -

to

Thus,

of the

Commission

determine

the

it was recommended

EIIB that the Honorable

were
tax
to

Commissioner

DECISION C.T.A. CASE NO. 5126

-

of

the Bureau

report

and

of

be

3 -

Internal Revenue

requested

to

be apprised

collect

from

of

the

the

herein

petitioner the following tax liabilities for 1987:

, 35% for income tax
"SO% for fraud
40% delinquency interest
1988 and 1989
T 0 T

8,824,618.48
.P41,916,937.78

A L

Then Commissioner
letter, dated October
assessment

and

total amount
office is

P.22,061,S46.20
11,030,773.10

Jose T. Almonte of

the EIIB in

26, 1990 (Exh. I), recommended

collection from

the

aforementioned and

petitioner

a
the

of

the

stated therein that

his

transmitting the entire docket

of the case

to

the Bureau of Internal Revenue (BIR) Commissioner.

Upon

SIR's receipt

Almonte, together
forwarded

to

with its
Atty.

Investigation and
his

immediate

of

the letter

of

entire docket,
Ruben

Commissioner
the same

Buenaventura,

Chief,

Intelligence Office (IIO) Divisi,on

and

January

25,

1991,

Deputy

Commissioner

appropriate
Atty.
Victor

action

Buenaventura

(Exh.

J)

recommended

Deoferio,

was

Jr .

following:
1.
That t~e
rate of gross profit for
imported
items
be
adopted
in
computing
underdeclared sales;

for
On
to
the

DECISION C.T.A. CASE NO. 5126

-

4 -

2.

That underdeclared sales be computed

on underdeclared imported purchases ~et
of advance sales tax paid;

b~sed

3.
That underdeclared sales be given or
allowed cost of goods for income tax
purposes;
and
4.

That imported purchases sold

to sales tax.
(Exh. K)

~subject

On February
Jr.

issued a

Speclal

12, 1991, Deputy Commissioner

memorandum to

Operations

prepare
petitioner

the Assistant

Service,

conference
of the

as is be

directing

letter

prop~sed

Commissioner,
the

. advising

Deoferio,

latter
the

herein

deficiency internal

revenue

taxes computed hereunder:

A. Data/Information from docket:
.-..-1.-Sales - Imported p. 10

__ , . ,,.p_..4].. , 054.258.98 .

------2. Cost of Sales -Imported:

a) Inventory-- ... "'
Imported 01.01.87-p. 10
11,184. 911. 23
--- b) Purchases - Imported p. 10
45,538,694.57' -Total Available for Sale
56,723,605.80
''l
c) Inventory -Imported 12.31.87 p. 10
16,495,544.63
. -:::P--401,'228. 061.17 ..
-------- 3. .. Undeclared-- Import
--- Purchases pp. 12-13

.... :: :.P.-94 ,-110,175. 00

-- B.--Computations:--- ...
----.. 1. Cost of Sales ratio A2/A1

2.

Undeclared Sales --
Imported Aa/81

to

85.492923%
P-110;079. 491.61

f"''

DECISION -

,,_,_,c.._:t,,_A..... ,.C.A.SE... N.0.-".. 5..12.6-...--..

--..... 3 ... Undeclared Gross

~ ... Profit 82 ---A3

15,969,316.61

..... C. Deficiency taxes due:

.. ,... -1. Deficiency Income<f.ax
.....- .... p .... ,5,-589, 261.00
---~ .. 83 x- 35%
...... ..
........ 50% Surcharge- C1 X 50%
2,794,630.50
... Interes-t:tO 02.28.91
...... ,3,213,825.08"
--~ C1 X 57.5%
.. T 0 T A l
-----:~P-11,597, 716.58
2.

Deficienc}lSales .. Tax ....

........... p_. --7,-290. 082. 72 ..

, ... .. at 10% pp.-12-13--....
...... at 20%- pp.12-13 10,493,312.31
.. Total Due-.
17,783,395.03
--less: Advance:.Sales.
Taxe.spaidpp.- 12-13
11,636,352.00
...... Deficiency Sales .. Tax
6,147,043.03
-50% Surcharge C2""'X 50% ...
3,073,521.52
..... Interest to' 02.28.-91
5, 532.338.73 "'
T 0 T A l
.. --7il-1:4.-752,903.28 (Exh. L)

On April 15, 1991, Asst.

Jaime Mara

Commissioner for Collection

issued a demand letter

to the petitioner

the payment of a deficiency income and sales

in

the

amounts

respectively
Notices

of

(Exh. C).

Nos.

the amounts

increased

from

and

the petitioner,
of

and

the same

to

tax for 1987

P14,75~~903.28,

date,

Assessment

FAS-4-87-91-001655

requiring the

P13,414,226.40

P3,213,825.08

P14,752,903.28 as its
respe~tively

On

FAS-1-87-91-001654

were issued against

to pay

P13,414,226.40

(interest

P5,030,334.90)

deficiency income and sales

for 1987 (Exh. D and E).

1 ._); ....') uc;

for

latter
being
and
taxes,

DECISION C.T.A. CASE NO. 5126

-

6 -

Petitioner .protested the

aforementioned

tax assessment.

The same was denied by

a letter, dated

December 10, 1993, which was

the petitioner on June

8, 1994.

deficiency

the respondent in
received by

Hence, on July

petitioner filed with this Court the

6, 1994,

instant petition for

\,

review.
Petitioner
the petition

presents the

proposition

for review that

as reasons

the 1987 deficiency

of

income

and sales tax assessments, including

increments, are void

ab

(a)

the

and

percentage

initio,

interests

on

the grounds

imposed

on

the

deficiency assessment

that:
income

notices .were computed in

of the provisions of Sec. 249(b) NIRC;

tax deficiency
year 1987, in
of

the NIRC

was computed

on an annual

1977, despite

the

violation

basis for

fact that

percentage taxes must be computed in

tax

(b) the percentage

accordance with the provisions of

of

deficiency

the

Sec. 193
in

1987,

accordance with Sec

....
162

of the

basis;

NIRC of

1986 (PO

No. 1994)

on a

quarterly

(c) the BIR official who signed

the deficiency tax

assessments was the Asst. Commissioner

for Collection who

has no

authority under

tax assessments; and

on

alleged

the Tax Code

to sign

deficiency

that the tax assessments were

documents

which

are

administratively or judicially, thus,

not

based

admissible

the tax assessments

DECISION -C.T.A. CASE NO. 5126

-

were not

7 -

based on actual facts

but on mere

presumptions

(pp. 2-4, Pet. for Review).

On the
and

other hand,

maintains that

-correct

and the

'-

(1)

in her Answer

assessments are

has

the burden

of

evidence to overcome the

correctness attached to the

assessments were

based on facts

the investigations conducted against

o f t h e Ec o n om i c I n t e lli g e n c e a n d

of unrecorded

purchases/importations which

miserably
presumption

assessments;

as a result

(4) the findings

of

as

been

processed

after payment

of duties and taxes,

to

consumption

the Bureau of Customs which

authenticated

of fact

gave rise

derived from copies of

having

to

I n v e s t i g a t i o n Bu r e a u a n d

Internal Revenue;

entries filed with

proof

and

petitioner by agents

the Bureau of

undeclared sales were

demurs

valid

(2) the petitioner failed

to present concrete

(3) the

the

taxpayer

impugn its validity;

of validity and

respondent

and

were duly
released,

by the Chiefs of

the

''1

Collection Division,

Manila International Container

and the Port of Manila, and

Financial

Statements

Exchange Commission;
to make
evidence
Court;
taxable

secured

legally admissible

income

from

the

(assessment) on
in

undeclared sales
of

qertified copies of

(5) the Commissioner

his determination

(6) the

duly

fr~m

petitioner

a formal
are

Port

Securities

is not required
the basis

of

proceeding

in

considered as

following

and

the

case

net
of

DECISION C.T.A. CASE NO. 5126

-Republic vs.

Gonzales

8 -

thus, lLable

(13 SCRA 633),

income tax at the rate of 35% under Section 24

Code, as amended;

(7) the imported items

to sales

original sales of

t~~nty

tax on

percent (20%)

based

Order No.

ten percent (10%)

on the

given value

fifty

percent (50%)

(8) petitioner

3 6) ;

surcharge and

to Section 248(b)

to Section 249

th~

is liable

a n d ( c ) .l. n

substantial understatement

of sales/income;

assessment

notices

signed/issued

Assistant

Commissioner

Commissioner, in

for

the

to

pay
(20%)

r e 1 a t i on

petitioner's
and (9)

the

the

then

for

the

by

Collection,

Order No. 2-85

atcordance with Adm.

to

(RR No. 11-86,

Tax Code, considering

were

of

twenty percent

interest pursuant
of

of the Tax

sold are subject

articles sold, less advance sales tax paid

Exec.

to pay

in

relatiori to Rev. Memorandum Order 27-85,

both dated Sept.

25 . 1985

sign

delegating the
I

authority

to

letters t~ the Assistant

notices and demand

assessment
Commissioner
''1

for Collection.
The issues
and

that

is

in this case may

whether

or not

be simplified into

the

assessments

respondent against petitioner have valid

thus
sales

subjecting the
taxes

P14,752,903.28,

in

the

latter to

amounts

respectively,

of
plus

by

and legal. bases,

deficiency income

and

P13,414,226.40

and

interest

accrue thereon until actual payment of the same.

l:J31

made

one

that

may

:t DECISION

<-,.._,,..C.--T.A-.-:CPtSE-NO .

5126 .... ,,.

... ,. _,__ g. .. -

Th e

i s s ue s hou1d

be

..

r u1e d
to

i n t h e"

rebut

a f f i r ma t iv e a s

the

validity

correctness of theaforementioned tax assessments.

incongruous fordrpwing

an inference

"

attacking
.f'""

the

which were

""~~~certlfied

Manila

petitioner to. provQ

source

the .bases

by

unfavorable

the

documents

International

of the assessments

Container

and which

and

of the

petitioner after payment of

......... the-duly .. certified copies of

.,,,--from the

Securities and

-..~-~inference.. c:a nn o t

operate

,.t''

required,

any

in the name

Exchange Commission.
to

.relieve

The-Court should

evidence

and

Any

such

petitioner

from

has no warrant

have been persuaded

of

relevance

and

like that of a certification from

consumption entries did

to

should ...,it have

competence
the Bureau of

Customs or from any other agencies, attesting

that those

of

Financial Statements secured

.grant the reliefs sought by the petitioner

.... .,.,.,,presented

Port

duties and taxes

bearing its burden of proof and this Court

of absolution.

were

Division,

the

.... , Kanila~as having been' processed and released

by

Entries),

Collection

Port

simply

respondent

(Consumption

Chiefs .. of the

It is

its cau'se by
to the

or

to the fact

not really belong

to

them ...
The burden

of proof

is on

the taxpayer

the validity or correctness of an assessment

,....... only thatr the Commissioner of

contesting
to prove not

Internal Revenue is

l.J32

wrong

-- DECISION

-> .. ,.,. C~;--'f...;A" CASE N0-.- 512 6 -- ,

....... ''"' ---10
',,
'T

'

... ~"""""but--- ..thetaxpayer is right

-~

{Tan Guan

vs.

903):. .. otherwise ... the,pres.ll!Jip;.t.iq_o" in ...

~---cor-rectness

CTA~

favor

ofLtax--- .. assessment stands(Sy Po vs.

!"'"'"'SCRA 524). "The--burden of

19

SCRA

of

the

CTA~

164

proving the illegality of-

assessment lies upon the petitioner alleging it

"'

In.. the-' . case" at 'bar,. -petitioner

miserably

t-he

to be so.
failed

to

discharge this duty.

However,-

with

regard

to

the

imposition

respondent of the 50% surcharge against

fraud penalty.

this Court cannot

make. the

fact:o

Pursuant to Section

282

...... ~ . .c-ont_~mplated before a

Willful

neglect

its sales/income will

petitioner

guilty

50% surcharge
a

can

fraud.

the fraud

be imposed
the

.... fraudulent return is"willfully made".

In

o.;ther words the

is intentional.

Commissioner to

prove that

'''"inten-t.i:onally for
cannot be

.,

Consequently, in.

civil

reason that the

fraud

defendant

himself.

In

the

substantial proo.f was introduced by

the

to est a b 1 ish

::""-?lmpo:siti:cm"' of
--- ,., .!C~O

si~ple

or

on the BIR

the taxpayer committed

compelled to testify against

-instant case. no
,. respondent

the

"false

is

or

... tax fraud cases. the burden of proof is always

;;'1''

.. of

(now 248) of the NIRC,

file

former.

return

fraud committed

to

the

the petitioner as

agree with the

The understatement of petitioner of

not .ipso

by

the

fact

the.. 50% surcharge

n side red arbitrary .

of fraud

thus,

as __ fr.aud~..

pe.nalt.Y~

the
i.s

DECISION ..... _... c "F- .. A,~ . ,c.ASE

No. 5126,
-

"Fraud is
,,, ... constituting

a question of
fraud must

,,,

r~viewed

and

"

,!

serious charge"

create only
tax is not

to be

to be

in

the

court as to

its

and

final

erroneous.

imputed and the Court never

fraud upon

circumstances

suspicion"i$and

the mere

itself proof of fraud

which,

. -,,.doesnot -prove fraud .. - {Gomez

it is

Co.~

sustains
at

most,

understatement-of

for the purpose of

....,,.,,SCRA-160).- -The.. mere -understatement

be

X X

llyal a Secur i t:i es

evasion. -(Yutivo Sons Hardware Co. vs. Court

~"-""'1168.

cannot

presumed because

( Cc.1mmi ssi oner vs.

~..,..,.,,.... Fr.aud:is'never:

of

is

circumstances

and proved

of the trial

clearly shown

never lightly

findings

alleged

non-existence

unless

--.Fraud- is

fact and the

be

The finding

-court below.
~xist~nce

11 -

a
tax

of Appeals. 1

of income in

itself

vs. Domingo. CTA Case

No.

February 15.1964) ...~.

---Although the reach of tlie issue on which

decision
.. issues

renders
raised

the

consideration
the

by

unnecessary, suffice it
--."''"'a d d r e s s e d

by t h e

Co u r t

of

the

in

petitioner

..,

we rest our
subsidiary

its

petition

to state that the same

should be

f or

t he p r ope r

gui da nc e of

t he

parties concerned.
-Petitioner raised
interests

imposed

in

the argument

that the

the

and

income

de-ficiency was computedinviolation of

1~34

deficiency

percentage

tax

the provisions of

, . DECISION "'k--C.::T.A.CASE NO. 5126

-~

Section 249(b), NIRC.

12 -

This Court believes that

.oclear . inadvertence or misinterpretation

of

the

provisions

provisions

of law
(b)

Section 282
\,

laws

of the petitioner

in

(now Sec. 248

s u r c h a r g e s h o u 1 d

no t

be i nc 1ud e d i n

This ratiocination
that

petitioner did

'' 248 Eel) where in it

"''"""''"imposed .shall ..fo.rm
..."&,,_,,.

. Sec.

not read

The

that the

t h e c om p u t a t i o n

Thus,

Section

282(c)

(now

entire amount

Court

respondent .c:as

aforecited provisions

of

Sec.

pen a lti es ,

prescribed in
the

Section

finds

the

correct

and

law

are~

quoted

hereunder, for easy reference.

-- SEC. 282.

C.i.v.i.l Penal t:.i. es.

of

manifestation

part o.f. the tax and the

249)..

50%

Section 283 (now

was clearly stated that the

..,..,..,..,.,.,.computation made .by, ... ,, the

logical.

and

is a clear

shall ... be .. subject to . the interest

., ..... ,:,283(now

[b] and [c])

at

National Internal

interest since this was not mentioned in

.f''

~re

Petitioner contends

.~

correct
bar

the case

Sec. 249) of the 1987

( NI R C)

The

applicable.

applicable

and (c)

Section 283 (now

Revenue Code

of

this is a

(a)

(b)
In
case of willful
neglect to
file
the return within the period
prescribed by this
Code
or regulations,
or
in
case a
false
or
.fraudulent
return
is
willfully made,
the
penalty
to be
imposed shall
be fifty
percent
(50%) of
the tax O"r of
the deficiency tax,
in
case any payment has been made on the ,basis of
,........ such return before the dis,covery
of the falsity
...... -.or fraud.

./ '' "DECISION -

:~!{";:~""'*a:C;:.. :r..... A.~"dC ASE~ .. N 0 512 6

,:

(c) The penalties imposed hereunder shall,.,..

form- partof the tax and the.,entire amount
shall be subject to the interest prescribed in
Section 283.

'

XXX

XXX

'""''"SEC.--263.-....'",.Int:erest:. (a),In general.

There shall be assessed and collected on any
unpaid amount of tax, interest at the rate of
twenty percent (20%)
per annum, or such higher
,..... ,.rate"* as, may .. be p r esc rib ed by reg u 1 a ti on s, from
the date prescribed for
payment until the
amount is fully~paid

> ...

...... ,..... ~(b)

Oe fiC':i encyin t:eres t:.
Any deficiency
in the tax due, as the term is defined in this
Code,
shall b
subject
to the
interest
prescribed in
paragraph
(a)
hereof,
which
.. i n t "! r e s t s h a 11
b e a s s e s s e d a n d c o 11 e c t e d f r om
the date prescribed for
its payment until the
f u 11 p a y me n t <..t.h e r e o f
(c)
Delinquency
failure to pay:

interest. -

In

(1) The amount of the tax

return required to be filed' or

case

of

due on any

(2) The amount of t~e tax due

which no return is required, or

for

(3)
~deficiency
tax,
or
any
surcharge or interest thereon, on the due
d a t e a p p e a r i n g i n t h e n o t i c e a n d d em a n d"l o f
the Commissioner,
there shall be assessed and collected, on the
unpaid amount,
interest at the rate prescribed
in paragraph (a)
hereof until' the amount is
fully paid,
which interest shall form part of
the tax.
xxx
On

the

percentage

"

issue
tax

XXX

XXX

raised by

deficiency

the
should

petitioner
be

that

computed

on

the

, ';:'''"' DE C I S I 0 N -

, ___, " C T A CAS E . N0 51.2 6

- 1.4.:-.

quarterly basis in
not annually,
,~~

Precisely the

_ "'"r.-an annual

"

finds

the

same

untenable.

fact that the

of the

adduce evidence

filed a correct

other pe,-.centage taxes

on

petitioner

with'the provisions of Section 162

that it

and,,,.,_,...

the percentage tax

Code. Pet! tloner did not

"Salesand

"<,

Court

basis because of the

- will show

/,,.'

the

respondent computed

did not comply

1987 Tax

accordance with Section162, NIRC

that

quarterly return
for the period

for

covered

-by the subject assessment

.. ,,,,,.,.,..,.The- -Court

agrees

Assistant Commissioner

with

the

respondent

for Collection

..... ,.. to sign deficiency tax assessments for

the Commissioner.
"'"~-said" of-ficla-1
which

This power is clearly

in Re\4'.,

took effect

November

-finds--the contention
divert

the

-~regulations

-to

real

15,

issue of

the law

to great

has the

the

have

and in behalf

of

delegated to the
Order

No.

2-85,

1985, thus,

the

Court

case.

ploy to

"Administrative
...,.

by administrative bodies

the

respect."

the

authority

of the petitioner as a mere

and policies enacted

interpret

entitled

-Administrative

that

force of

"(Eslao

law

and

vs. Commission

are
on

'":Audit. 236 SCRA 161)

Further,-peti-tloner,
from

the assessments

were based

in seeking to exculpate

alleged

that the

on documents which were

,.. import entries,

tax

itself

assessments

mere xerox copies

of

thus, not admissible administratively

or

133'1

,' ,
_DEC I~ I 0 N -:
,..-.. C.T.A ... CASENO. 5126"
-

15 -

hence, the

-:judicially against it,

assessments were

not

We ruled

base-d onactual facts but on .. mere presumptions.

-en contrarlo to the stand of the petitioner.

. . tax e, s
\

..

on the

basis Of . the best

evidence o b t a in a b l e . -in

, ... -.case of fai-lure on the part of the taxpayer. tq s_ubmit the

requ-ired--returns,statement, records

and.,other documents

. -,,,.,.....L-Based_ on the records. presented, petitioner

......,. the-"required
"~

books

"best evidence
required

,.. f r a u d u 1 e n t .

.-by

Co u r t

obtainable" applies

by law

available or

and . other financial

h e l d by t h e S u p r em e

...., r e q u e s t e d As

for

when

the purpose
the

tax

when

records
i n t he c a s e

is

as

basis for

is

incomplete

the assessment

internal revenue tax.

,-.SEC.
16. , Power
or the Commissioner
----,makr"i!tssessment:s. ,_.,.-(a) x x x ,.. ".

of

report

tax

of assessment

report

when

the questioned documents may be

Hence,

the respondent

fails to submit

of

not
or
used
any

....
t:o

(b)

Fall ure
to subm.i t
requ.i red reports~
.. -- .. ----- When a report required by
law
as
a
basis
for
the
assessment of -any
national
internal
revenue
tax
shall -no-t. be
.~ . ~.forthcoming .within the
time
fixed by
law or
...... _,.... ,regulationol"' when there
is reason to
believe
... tha.t. .any. such repor-t is ....f.a-1 se, incomp-lete. -or
.,..,..--;-..e-rroneous,-- ~--the Commiss io ne r
sh a 11 ,assess -the
----pr-oper"-tax--on the be-s-t evidence obtainable .
-s-tatement~--et:c-~

In case a
person fails to make and
fil-e a
required return-- o-r- .. lis-t at. the- time .. - pre s c r.-ibed--,~....

<lr~l

""''

~ ..r;:w

0 E CI S I 0 N C.T .ti/!t.,: CASE

N0

512 6

. -

16 -

'

.,.,.,~,.by

law,
or makes
willfully. or
othet1wis.e,. a"'"
false
or
fraudulent
return
or
list,
the
........ Commissioner shall. make- the return
from his own
_,,,,,.,,knowledge and ... f.rom .such
informa-tion as he
can
.,.,.obtainthrough.testimony
or otherwise.
In
any
such case,
the Commissioner may make a
return
or amend
any return and any
return so made
or
amended
shall be
prima
facie
good
and
sufficient
for
all
legal
purposes.
'
(Underscoring supplied)
XXX

,. ,;- By t h e u s e

,. f

.. ,... ,.,,amends the

XXX

of

XXX

t h i s me t h o d t h e Com mi s s i o n e r

return from

his own knowledge

information as he can'obtain thru

" Assessments. made

as such are

and sufficient for

the duty

o~

ma k e s o r

and from

testimony or otherwise.

deemed prima facie

all legal purposes.

proving otherwise.

such

The

correct

taxpayer has

As earlier adverted

to,

petitioner failed to discharge this duty.

-~

Where the taxpayer

the ground that

is appealing to the Tax

the Collector's assessment is

itis incumbent upon him to p'rove what is

just

liability by

... ,~pertinent
...

data in

full

his

taxpayer confines himself

..,~-isW'rong,
as the way

and fair

possession.

erroneous,

the correct and

disclosure

of

all

Otherwise,

if

the

to proving that the

assessment

the Tax Court proceedings

would settle nothing,

would be left open for

subsequent assessments

....~ .. and,.. appeals in interminable succession.

.-,,

Court on

.,.,.,.of"~axAppeaLs.

supra.)

(Sy

Po vs. Court

DECISION C.T.A. CASE NO. 5126

-17 -.
As

earlier discussed

deficiency...

assessment

petitioner, except
which should
fi~dings

this Court

made

only be

25%.

In

respondent

by

the imposition

affirmed the

of the 50%

1987

against
surcharge,

accordance with the

of the Court, the computation

said

made by respondent

\,.

of

the

deficiency

income

petitioner found on

and

sales

taxes

page 5 of this decision

of

the

is modified,

.... a s f o 11 ow s :

"-""""'-1.- Defriciency income tax

---~5,589,261.00

Plus additions to ~ax

a. 25% surcharge [Sec. 282(a)]
1,397,315.25
(5,589,261.00 X 25%)
b.20%deficiency interest [Sec .:283(b)]
04-15-88 to 04-15-91
,.,, ..... 4,195, 774.01 '
(6,986,576.25 X 20% X 1096/365)
Totql income tax due and payable
. ,. . Pll, 182 350. 26
-~

2. Deficiency sales tax

Plus additions to tax
a. 25% surcharge [Sec. 282(a)]
(6,147,043.03 X 25%)
b. 20% deficiency interest. [Sec. 283(b)]
01-20-88 to 04-15-91
(7,683,803.79 X 20% X 1182fo665)
Total income tax due and payable
,..... IN

THE

LIGH"T

-OF All

THE

p 6.,147,043.03

1,536,760.76
4. 976 ..~78. 67.
,,. P12., 660,382. 46

FOREGOING,

......... hereby rendered DENYING""'the herein petition.

judgment

Petitioner

...._...,.. is-- herteby ORDERED:-r<.t.oPAa,;-th e respondent Commi s si one r

Internal
for the

Revenue its
year 1987

deficiency income

in the amounts

. respectively,

1.J4CJ

of
plus

and sales

~11,182,350~~6

20%

is

of

taxes
and

delinquency

DECISION C.T.A. CASE NO. 5126

- 18 interest per
15, 1991

annum on

both deficiency taxes from

until fully paid

pursuant to Section

April

283(c)(3)

of the 1987 Tax Code, with costs against petitioner.

--,..~.....,.,

... SO" ORDERED.

.... ,-..... ._. ...... .

~~~Q. Q~

'"

ERNESTO D.

ACOSTA

Presiding Judge

RAJIION 0.

DE

..... Associate . Ju

:
/

-'-

'

~
~L
~Asse>c-iab Ju~
Ncio

Q.

:"" .

CERTIFICATION

h~reby

after due
-Tax-Appeals

certify that-the above

decision was reached

consultation with 'the members

in accordance with

---ofthe .. Consti tution.

of the Court

...,

Section 13, Article

~l9.Q~

ERNESTO D.

ACOSTA

Presiding Judge
Court ofTax Appeals

1;J41

of
VIII