Court of Tax Appeals
0Ciriaco B, et al. vs. ' Commissiontr of Internal Revenue
AKRFPUBLIC OF THE PHILIPPINES .
COURT OF TAX APPEAL?
QUEZON CITY
CIRIACO B, MRNDOZA
Petitioner, 1; 4 Lb
versus CTA CASE NO, 1353
' COMMISSIONTR OF INTERNAL
REVENUE,
Respondent.
1 Kkawneeeeeseeaeawe &
DECiIsSsiog8
This case involves an assessment by the re-
spondent against petitioner fer advance sales
tax in the smount of 2195,21%.37, plus #10,000,00
“gn eanprindons or a total sum of °205,21%.37 on
alleged importations of goods or articles (house-
hold appliances).
‘Pursuant to a search werrant issued by the
Court of First Instance of Manila, a team con-
posed of Constabulary, Nevenue and Customs agents
(CRC for brevity) raided and searched a bodega
Located at 137 Yakal st., Makati, Rizal on August
26, 1958 and owned by the herein petitioner.
In the course of the said search, bundles of
éuplidate Informal Sntry statements of duties
evideneing impertations of household electrical
epplisnces and other goods or articles consigned
DECISION .
CTA CASE NO. 1353
te different persons, were confiscated or seized
from the said bedegea by the CRC team. Also con- |
fiseated were 13 crates of household electrical
epplianees which the team found loaded on e cargo
truck parked in front of petitioner's bodega.
The truck belonged to Yum Ping brokerage.
The subsequent fects are as stipulated by
the parties thus: |
2. That by a letter dated August
20, 1959, addressed to the Petitioner
and Sted in the mail on Sept. 3,
1959, Respondent assessed and
demanded payment from the Petitioner
of the sum of £295,214.37, as advance
sales tax (in the sum of *195,21%.37)
and compromise (in the sum of #10,-
000,00) elaimed to be due from the
Petitioner on certain alleged importe- -
tions of goods all te have been
made in the years 1955 to 1957. Cony
of said letter dated August 20, 1959,
is hereto attached and made an in-
tegrel part hereof as ANNEX "A",
3e That by a letter dated September
15, 1959, and filed with the Aesponi-
ent on September 17, 1959, the Peti-
tioner, thru counsel, Gisputed the
aforesaid assessment and requested
for a re-investigation and reconsidera-
tion of the said assessment on the
alleged ground that the said assess-
ment was erroneously besed on alleged
importations which Petitioner
claimed he never made. Copy of said —
letter dated September 15, 1959, is
hereto attached and made an integral
part hereof as ANNEX “B",
%» That the Respondent, by a
letter dated October 1, 1959, addressed
to and received by the Petitioner's
counsel om October 22, 1959, denied
the aforementioned request of the *eti-
tioner for re-investigation and re- —
DECISION «
CTA CASE WO. 1353
3
eonsideration of the assessment
stating that the said assessment ir
correct and lawfully due from the
Petitioner, it having been besed on
a5 exasination of the books of ac-
eounts ef the Petitioner. m. of
said letter dated Setober 1, 1999,
is hereto attached end made an in-
— part hereof os ANNEX “C",
§. That the Petitioner thru
att by a letter rr An October
» and filed with the Respond-
pe on the same date, requested again
the Res ent for the reinvestiga-
tion reconsideration of the assess-
ment, on the ground that he aid not
import the goods upon which ee Re-
r ent e@ the a
ting as further o thet (a)
he books of the Pe itiensr were not
pened by the Respondent's investiga-
ting agents; (b) that the compensating
tax on the goods in question have
' been paid by the respective importers
thereof, of which the Petitioner is
not one of thems (e) that assuming
thet the atyenee sales tax were. the
tax collectible, and assuming further
that the goods in question are all
subject to 1007 mark 8 ~ defieien-
ey advance sales tax only amount
to 236, 442.7 inotena “of 3195, 216457
as assessed the Nespendent; and
that (4) the Petitioner is the
proper party liable for the advance
seles tax on said importations. Copy
of said letter dated October 23, 1959,
is hereto attsched and made an in-
tegral part hereof as ANNEX “bD",
the Petitioner thru counsel, fied with
the Respondent a nemorandum dated
December ©, 1959, reiterating the
request for re-investigation and re-
consideration of the assessment in
estion, stating as edditional ——
or the Fequest hat the documen
wich the questioned assesament —
based de not belong to the Petitioner;
that they (the documents) were used
in a criminal case instituted against
DECISION «
CTA CASE NO. 1353
iy
the Petitioner and other persons, but
the said criminal case was dismissed;
and that the Petitioner hed nothing
te do with the aforesaid documents
and with the goods therein referred
to, as both said documents and said
goods do not belong to him. of
seid memorandum dated December
1959, is hereto attached and made an
integral part hereof as ANNEX "5",
7. That on March 1, 1963, a Com
plaint was filed by the herein Re-
spondent, as plaintiff, against the
herein Petitioner as defendant, with
the Court of First Instance of
(Ciwtl Case No. 53259), for the eol-
lection ef the abovementioned assess-
iy es ee and the copy of
& complaint were ectuelly served
on the herein at on March 7,
1963. Copy of sa he yy and Sum-
mons are hereto athe and made
integral parts hereof as ANVEXES “F*"
and "F-1" respectively,
8. That in this collection suit,
cere, Manila, Civil Case “Soe. 53259)
the herein Petitioner filed his Answer,
in due time, alleging in substance
sult for colleetion is
So ateeuhgn Rah ache on dubegenl part
oO a e an re
hereof as ANNEX "G*.
9. The partion herein reserve
their right to adduce such additional
eral and documentary evidenee they
may deem proper. ;
The issues to be resolved by this Court are
whether or not (a) the petition for review was
seasonably filed, ané (b) whether or not peti-
tioner is the importer of the appliances men-
tioned in the duplicate informal entries seised
by the CRC teem in his bodega and es such liable
for advance sales tax on their importations.
* 167
DECISION «
CTA CASE MO. 1353
5
a
Respondent contends that this Court has no
jurisdiction te entertain the present petition for
review for the reason that the same vas filed
beyond the statutory 30-day period. Fetitioner
on the other hand contends otherwise.
As we have gathered from the stipuletion of
facts ef the parties, the assessment dated August
20, 1999, was mailed by the reagpondent on Septem-
ber 3, 1959. ‘etitioner disputed the aforesaid
assesanent and requested a re-investigation and
reconsideretion thereof in his (petitioner) |
letter dated September 15, 1959 and filed with
respomient on September 17, 1959. The said request
for reconsideration and re-investigation wes
denied by respondent in his letter dated Oetober
1, 1959 whieh was received by petitioner on Oct-
ober 22, 1959, and from this day the statutory
30-day period commenced. The running of said
peried was interrupted on Ostober 23, 1959 when
petitioner filed with respondent ancther request
for reconsideration and re-investigation on grounds
other than those stated in his first letter for re-
consideration. On December 9, 1999, petitioner __
filed with respondent a memorandum in support of
his second request for reconsideration and re-
investigation. As to what transpired subsequent- i
iy, that ts in controversy.
\
.
168
DECISION
CTA CASF BO, 1353 6 ~ Petitioner urges that the motion for re-- consideration dated Sctober 23, 1959 was never “acted upon by respondent until the filing ef a eivil case in the Court ef First Instance of Ma- mila on Maroh 1, 1963 for the collection of the assessment in question. Respomient, for his part, refers our attention to "xhibit 7, a copy of a letter dated April 12, 1960 (p. 6% of the BIR re- cords) denying the motion fer reconsideration aforesaid. It is cleimed that said letter was sent to petitioner on April 29, 1960. Testifying on this point counre! fer the petitioner stated that he never received the original copy of that said letter otherwise, as is his practice, he would heave seted accordingly.
( Trere is nothing in Fxhibit 7 to show that the original thereof hes been sent to petitioner. No notetion thereon ean reasonably bear this out. And 4f there were a notetion to this effeet the same, standing alone as it does, would not be suf- ficient preof of netice, following the esteblishe’ doctrine in the case of Gonzele ?. Yava v. The Com- missioner of Internal Revenue (6.2. Ho. L-19470, Jan. 39, 1965) follewed by this Ceurt in the case of Margerite Soriano de %. de Vieufia, et al v. Commissioner of Iintermal Revenue (CTA Case No. 1917, September 6, 1966). The Court is therefore constrained to believe that the original of re~ * 4169
BECISION -
CTA CASE NO. 13530 a 7 spondent's letter of April 12, 1960 was not sent to petitioner as testified te by petitioner's counsel. ) | . a The dental of petitioner's motion for recon- sideration of October 23, 1959 is the filing of the civil case in the Court of First Instance of Manila on March 1, 1963. The date of notice there- of should be the receipt of the summons on “arch 7,» 1963. Seedless to say, this petition was filed before this Court on March 21, 1963 and so it was seasonably filed.
Ané now we come te the validity of the al pealed assessment. The same is based on duplicetes of informal import entry statements, not in the neme of petitioner but of different persons, whieh were seized by the CRC agents from petitioner's bodege. It is further based on the testimony of Termin Redoblado, a BIR examiner who participated in the raid of said ‘bodega in Yakal street, Makati, Aigal om August 26, 1958. As a witness, Fedoblade testified that according te information subsequent- ly gethered by the Constabulary and transmitted to him, most of the names appearing in the duplicates of said statements are of fictitious persons, From this evidence and the cirevmstance that peti- tLoner 414 not produce his books of account, re- spondent advances the inference that petitioner * 17¢
DECISION
CTA CASE NO. 9353 is the importer of the items appearing in the eforementioned documents, This inference, solely on the besis of the evidence of respondent, is intrinsically inconclusive. When teken in the light of the evidence adduced by the petitioner explaining the presence in his bodega of the in- formal tuport entries in question, the inference becomes remote, — ce Redoblado's testimony thet most of the names ' appearing in the duplicates of informal entry statements are fictitious, is pure hearsay. There ie on the other hand substentiel evidence te the contrary. Taking the stand, petitioner ex- — plained that the documents in question ao not belong to him but to Mereiel *. Enriquez and to GOMBCO, that at the time of the seizure of the aforesaid documents GOMPCO wes using his bodegs with his permissions that he allowed GOMPCO to use seid bodega because some of its owners whose names he mentioned were his friends; that the appliances seized by the CRC team during the same raid belong te GOMPCO,. On this point his testimony finds cor- peboration from Mercial P. Enriquez, an agent of 8 cus tons broker, who testified that the aforesaid documents belong to his personal file; thet most of the appliances mentioned in seid documents be- long to GOMPCO while the rest belong to Army end “oevy 474 ——————— — —
DECISION «
9 personnel ané other persons; that his personal files which were seised by the CNC team included GOMF.CO stock cards and COMECO delivery receipts. Another witness, Martin Magante, then an employe of GOMECS, corroborated aspects of the testimony of petitioner. Indeed, “edoblado himself admitted that many whose names appear in the seized informal import entry statements acknowledged the ownership . of the appliences sentioned therein and that the two trneklosds of appliances seized in the premises of petitioner's bodega beleng to GOMECO. Re- spondent, with the vast facilities at his ecumand, with the Constabulary helping him, could have easily cheeked the truth of the testimony of patie tioner, of Mareial *. “nriques, and of Magante, especially, as they gave the names of some of the owners of GOMBCO, and could have easily presented rebuttal evidence to destroy petitioner's ver~ sion. That the same stands unrebutted leads us to believe that their statements are substantially true.
In fine, the Court is of the opinton and go holds thet the appealed assessment cannot be sus- tained. | WIFREPORE, the deeision appealed from is hereby reversed, ‘without pronouncement as te costs.
DECISION «
CTA CAST WO, 1353 19 80 ORDERED.
Quezon City, July 19, 196°.
fl. Un RAMON L. AVANCRRA associate Judge
WE CONCUR:
ROMAN ©, UMAIT |