TAX1.28 RCBC v.

Commissioner

FACTS: same with 11.22

ISSUE: Whether a taxpayer, by paying the other tax assessments covered by a Waiver of the Statute of Limitations, is
consider estopped from questioning the validity of the said waiver (on the basis that the CIR did not sign it) with respect to
the other covered but unsettled assessments?

RULING: YES. The Court ruled that estoppel applied to the taxpayer. In this case, taxpayer, through its partial payment of
the revised assessments issued within the extended period as provided for in the questioned waivers, impliedly admitted the
validity of those waivers.

TAX2.28 Philippines Bank of Communication v. Commissioner

FACTS: Petitioner filed its 1989 annual ITR on April 11, 1990 and so, the BIR has until April 15, 1993 to assess. On March
16, 1993, petitioner executed a waiver consenting to the assessment and/or collection of the taxes which may be found due
after investigation at any time before or after the lapse of the period of limitations but not later than September 30, 1993.

ISSUE: Whether BIR’s right to assess was extended by the said waiver.

RULING: No. An examination however, of the waiver would reveal the absence of the signature of the Commissioner,
whose signature is required in waivers for tax cases involving more than one million pesos. The waiver was invalid and
consequently did not suspend the running of the three-year prescriptive period.

TAX3.28 Luzon Packaging Products v. Commissioner

1. Petitioner filed its annual ITR on October 10, 1989 reflecting tax of P437K.
2. Petitioner executed a "Waiver Of The Defense of Prescription” extending the period to assess to December 31,
1992. This waiver was not signed by CIR.
3. Subsequently, another waiver was executed by the petitioner which was undated and period to assess was extended
up to June 30, 1993.
4. On April 20, 1993, petitioner received assessment notices. Petitioner contends that the assessment for deficiency
income tax is null and void for having been issued beyond the three-year period.

ISSUE: whether or not the assessment was issued beyond the three-year period allowed by law.

HELD: Yes. The waivers executed by petitioner have no binding effect. The first waiver was not valid because the
Commissioner did not give his consent as evidenced by the fact that he did not sign the document. The fact that it was left
unsigned by the Commissioner signifies that there was no valid agreement to stop the running of the period of limitations.

TAX4.28 Solid Cement Corp v. Commissioner

Ruling: Amount and kind of tax, and date of acceptance of waiver by BIR and date of fact of receipt by the taxpayer
must be indicated in the waiver.
The date of acceptance of said waiver by the respondent and the fact of receipt by the petitioner of its copy of the
accepted waiver were not indicated in said waiver. Therefore, having been ruled that the first waiver was invalid, the 3 year
reglamentary period was not interrupted. In other words, the assessment issued on March 14, 1996, for alleged liability
incurred in 1990 already prescribed. Considering that the first waiver is not valid, there can be no basis for the second
waiver.

TAX5.28 Afisco Insurance Corporation v. CA

FACTS: The petitioners are 41 local non-life insurance corporations. Upon their issuance of Erection, Machinery
Breakdown, Boiler Explosion and Contractors All Risk insurance policies, the petitioners entered into a Quota Share
Reinsurance Treaty and a Surplus Reinsurance Treaty with the foreign insurance corporation, Munich. The reinsurance
treaties required petitioners to form a pool which was created on the same day. Subsequently, the pool of insurers submitted
a financial statement and filed an “Information Return of Organization Exempt from Income Tax” for the year ending in
1975, on the basis of which, it was assessed by the Commissioner of Internal Revenue a deficiency in corporate taxes in the
amount of P1,843,273.60, and withholding taxes in the amount of P1,768,799.39 and P89,438.68 on dividends paid to
Munich and to the petitioners, respectively. The petitioners filed a protest which the Commissioner of Internal Revenue
denied. The Court of Tax Appeals affirmed this decision. Concurrently, the CA ruled that the pool of insurers was considered
as a partnership taxable as a corporation, and that the latter’s collection of premiums on behalf of its members was taxable
income.

Petitioners argue that the government’s right to assess and collect the subject tax had prescribed. That the subject information
return was filed by the pool on April 14, 1976. BIR telephoned petitioners on November 11, 1981, to give them notice of
its letter of assessment dated March 27, 1981. Thus, the petitioners contend that the five-year statute of limitations then
provided in the NIRC had already lapsed, and that the internal revenue commissioner was already barred by prescription
from making an assessment

ISSUE: Whether the government’s right to assess and collect said tax prescribed

RULING: No, the CA and the CTA categorically found that the prescriptive period was tolled under then Section 333 of
the NIRC, because the taxpayer cannot be located at the address given in the information return filed and for which reason
there was delay in sending the assessment. Indeed, whether the government’s right to collect and assess the tax has
prescribed involves facts which have been ruled upon by the lower courts. It is axiomatic that in the absence of a clear
showing of palpable error or grave abuse of discretion, as in this case, this Court must not overturn the factual findings of
the CA and the CTA.

The law clearly states that the said period will be suspended only if the taxpayer informs the Commissioner of Internal
Revenue of any change in the address.

TAX6.28 Palanca v. CIR

FACTS:
1. Gliceria Diluangco died. Executor filed estate and inheritance tax return. The estate was assessed estate and
inheritance taxes.
2. The executor requested reconsideration, which the CIR denied.
3. CIR issued a WDL. However, it was not executed because the executor of the estate asked for a reinvestigation.
This request was granted upon condition that the properties shall be under constructive levy.
4. A new assessment was issued. CIR ordered WDL to be executed (with change of amount).
5. Atty. San WDL was issued which was served on the secretary of Atty. San Jose, but instead of paying the tax, Atty.
San Jose requested for the breakdown of the amounts due from the heirs.
6. Atty. San Jose wrote another letter requesting reconsideration of this assessment but the same was denied by the
Commissioner.
7. The heirs, thru counsel, made a turn-about by raising this time the defense of prescription.
8. Before the SC, the heirs argued that warrant is ineffective because it was not served upon the taxpayers themselves.

ISSUE: Whether right of the Government to collect has not prescribed.

RULING: The service of warrant of distraint and levy to a taxpayer’s authorized representative, who has always acted in
behalf of the taxpayer, is sufficient to toll the running of the prescriptive period.

TAX7.28 Advertising Associates v. CA

FACTS:

1. AA is being held liable for 3% Contractor’s percentage tax for rental income from the lease of neon signs and
billboards;
2. Petitioner relies on the Collector's rulings that it is neither an independent contractor nor a business agent but a
media company, but not an advertising;
3. AA contested the assessments;
4. September 13 and November 21, 1974 – requested 2 letters of cancellation
5. March 31, 1978: the Commissioner resorted to the summary remedy of issuing two WDL;
6. May 23, 1979: Acting Commissioner wrote an answer to the requests of the taxpayer for the cancellation of the
assessments and the withdrawal of the WDL. He justified the assessments by stating that the rental income of
Advertising Associates from billboards and neon signs constituted fees or compensation for its advertising services.
7. AA filed petition for review. The Tax Court enjoined the enforcement of the WDL.

ISSUE: Whether or not the right to collect already prescribed

RULING: No. The court allowed the suspension of the prescriptive period since the enforcement of the warrant was not
implemented because of the pending protests of the taxpayer and its requests for withdrawal of the warrant.

TAX8.28 Collector v. Codinera

FACTS: The CIR sent a WDL against the properties of Codiñera for collection of certain deficiency specific tax. However,
it could not be effected in view of the attachment of the said properties of the CFI-Manila of another case. After 7 years, the
CIR issued a WDL upon the real property of the estate of the deceased. The heirs of the deceased filed the action with the
CTA barring the government to collect said deficiency on the ground of prescription.

ISSUE: Is the government barred from levying the property of the deceased.
RULING: No. The prescriptive period to collect is not suspended during the period that the property of the taxpayer is in
custodial egis because it may still be distrained subject to the prior lien of the attachment creditor.

TAX9.28 Cordero v. Gonda

FACTS: On Sept. 18, 1953, a demand letter was made on Ponferrada by the BIR for the payment of P3K, covering forest
charges for the years 1946-1949. Ponferrada made a partial payment of P262. Ponferrada died on Nov 25, 1957. Joaquin
Cordero was named administrator. On July 29, 1959, the BIR filed in the probate proceeding a claim for the balance. The
administrator opposed on the ground of prescription which was affirmed by the probate court. BIR argues that the partial
payment is a “waiver of the defense of prescription”

ISSUE: Whether the partial payment of the tax liability suspended the prescriptive period or is considered as a waiver of
defense

RULING: No. When the taxpayer partially paid the deficiency tax, the prescriptive period is not suspended because the
government is not prevented from collecting the tax nor does it constitute as a waiver “in writing” of the defense of
prescription.

TAX10.28 Republic v. Ret

FACTS: same with 10.27

ISSUE: Whether or not the prescriptive period was suspended when the 2 informations were filed.

RULING: No. The pendency of a criminal case does not suspend the running of the prescriptive period to collect the tax
assessed in the absence of any court order prohibiting its collection. A criminal action for a tax violation is distinct from
civil action.

TAX11.28 BPI v. CIR

Facts: same with 13.19

Issue: Whether the prescriptive period has been suspended

Held: No. In order effect suspension of the SOL, the request for reinvestigation must first be granted by the CIR. There is
no evidence in this case that the CIR actually conducted a reinvestigation. Hence, there is no basis for the tax courts ruling
that the filing of the request for reinvestigation tolled the running of the prescriptive period for collecting the tax deficiency.

TAX12.28 Commissioner v. Wyeth Suaco Laboratories

FACTS:
1. Wyeth is engaged in the manufacture and sale of assorted pharmaceutical and nutritional products.
2. BIR assessed Wyeth.
3. Wyeth Suaco through its tax consultant SGV &Co., sent the BIR letters protesting the assessments and requesting
their cancellation or withdrawal on the ground that said assessments lacked factual or legal basis.
4. CIR rendered a decision reducing the assessment of the WHT. However, deficiency sales tax remained the same.
5. Thereafter, Wyeth Suaco filed a petition for review in CTA praying that CIR be enjoined from enforcing the
assessments by reason of prescription.
6. CIR argues that the protest letters sent by SGV & Co. in behalf of Wyeth Suaco, requesting for withdrawal and
cancellation of the assessments were actually requests for reinvestigation or reconsideration, which could interrupt
the running of the five-year prescriptive period.

ISSUE: Did the right to collect prescribed.

RULING: No. See book page 702.

The records of the case shows that Wyeth admitted that it was seeking reconsideration of the tax assessments as
shown in a letter of its President and General Manager. Furthermore, when Wyeth thru SGV sent the letters protesting the
assessments, the BIR conducted a review and reinvestigation of the assessments.

TAX13.28 Repbulc v. Ker & Co., Ltd

FACTS:
1. In 1953 the BIR issued assessments for deficient amounts against Ker for the years 1946-1950.
2. Ker & Co., Ltd. filed with the CTA a petition for review with preliminary injunction. The appeal was dismissed for
having been instituted beyond the 30-day period.
3. The BIR sent demand letters but the respondent refused and put up the defense of prescription of period for
collection.
4. BIR filed a complaint for the collection of payment for taxes.
 5. Ker & Co., allege that since the complaint for the collection of the deficiency income tax only on March 27, 1962,
or nine years, one month and eleven days from February 16, 1953, the date the tax was assessed, the right to collect
the same has prescribed.
6. The Republic however contends that the running of the prescriptive period was interrupted by the filing of the
taxpayer's petition for review in the CTA on March 1, 1956.

ISSUE: Whether or not the BIR was barred by prescription?

RULING: No. The running of the prescriptive period to collect the tax shall be suspended for the period during which the
Commissioner of Internal Revenue is prohibited from beginning a distraint and levy or instituting a proceeding in court,
and for sixty days thereafter.
The pendency of the taxpayer's appeal in the Court of Tax Appeals and in the Supreme Court have the effect of
legally preventing the Commissioner of Internal Revenue from instituting an action in the Court of First Instance for the
collection of the tax

TAX14.28 Commissioner v. Atleas Consolidated Mining & Development

FACTS: same with 13.19

ISSUE: WN a mere request for reinvestigation or reconsideration of an assessment has the effect of suspension.

RULING: No. a mere request for reinvestigation or reconsideration of an assessment has the effect of suspension. The
ruling is logical; otherwise, there would be no point to the legal requirement that the extension of the original period be
agreed upon in writing.
The only agreement that can suspend the running of the prescriptive period for the collection of taxes, entered into
before the expiration of the 5-year period, extending the period of limitation prescribed by law.