Court of Tax Appeals
0Republig of the Philippines. Court of Tax Appeals Quezon> City | Tkopical | >Isurtbutors, Inc. vs. = C.%Eae Case No. 2345 Dis Cobiiscligsan of Ints Anal Lusvnue, et al.
RF.PURI,lG OF THE Plli.LIPPIN¢8 .
COURT OF'' AX APPEALS
QUEZ0t'h CITY
':.'LO
IC~;~.L DIS'r::::U3T.:-':COHS, IITC . ,
etitioner ,
- versus -
'.-·:.~~ G0lu .. I:.JuiG~:~l~ C1~ IHT .. ~i,i'! L
_:.wV~i.TUB,
hes:Jondent.
X -
-
-
-
-
-
-
-
-
-
-
X
C. '.L' .
• CAS2 HO q 2345
. D ·2 C I S I 0 N
espondent assessed at;ainst )etitioner the sum of
P11,255. 89 , re}resGntinc deficiency income tax and
penalties for the year 1968.
Petitioner is a cor}or~tion or~a~ized and exis~ing
under tile laws oi' the Republic of the
~llilippines ,
1di th
bt:siness adc.ress at ~305 J?asonL; J:ano ..wxtension, L.a.,cc.tl,
{izal .
etitioner 1 s taxaole year or accounting period
is the calendar year so that on ~pril 15, 1969, it filed
its income tax return for the calendar year 1 968 ~
In
conputing its income tax for 1968 , petitioner applied
the 2~;- 30; income tax rates as provided io Section 24
of the ~ evenue Code, .)rior to its amendr:1ent by Hepublic
.~ct '.,o . 54-31, _vrhich took effect on June 27 , 1968 , and
based on the aforesaid rates arrived at the amount of
96 , 0 1 3~00 as income tax due for 1968o
after investigation, respondent assessed against
petitioner the aaount of 1?11.,255. 89 , representing de lin~
ql,ency income tax for 1968 , incll'.Si ve of interest and
coinpromise penalty Q
This assessment resulted from the
•
DECIGI 'II
C':Cl~ C.d.GJ; 1:0. 234-5
2
a~plic&tion of tiw new cor)orate income tax rates of
25;.; and 35>~ under Hepublic ..'A.ct no . 5l.Jj 1 on l)etitioner ' s
incmae for the peri od from J"uly 1, 1968 to December 31 ,
1968 0
~he said assessment was protested by Jetitioner
in a letter dated pril 29 , 1971 and was received by
respondent on the saoe date .
v
:Iithout reso1vin6 the protest of petitioner , a
\-Tarrant of distraint and levy "dO.S issued by respondent
on .:u..;ust 10 , 1971, ·\\T:1ich
appe.:.~rs to l1ave been. sel'Ved
on petitioner qn .illgust 19 , 1971o
Petitioner protested
t11e issu.a..nce of t:1e \·Tarrant of distraint and levy on
.. 1.1..1~ust 23 , 1971, alleging that the assessment had been
previ ously contested in a letter dated . .:'pril 29 , 1971 but
no action l:ras tal-:en. by respondent on trw aforesaid pro-
test, :cwci. , therefore , t!1e vrarrant of o.istraint and levy
should be uithdr ~n--m as it 'i·Tt .. s prematurely issued.
In an indorse~erit dated SeJtember 21, 1971 by the
Chief , Collection branch , the ~ssi s tant regional Director
Has asked 'illlet!:wr· or not the execution of tiw uarre.nt of
distrai~"lt and levy served on August 19, 1971 should be
On Octouer 7, 1971, trw . cting Le,_,ional Director rendered
a decision denyin.~ petitioncr 1 s protest und reiterated
t11e payment of' the auount of F-11 , 255. 89 as assessed ,
ot.::wriiise,
res)O~lc".ent i.WUlci enforce the collection of the
same ':Ti thout further notice .
·Tne aforesc~id letter 1vas
received by petitioner o~ October 29 , 1971 .
3ence, on
D0CISION
CT.~ C.. l&~ lJO . 2345
3
~ovember 11, 1973, )etitioner filed the herein appeal .
The i ssues raised are :
( 1) dhether or not the a11peal of peti-
tioner vas filed within the 30- day period
piescribed in Section 11 of Republic ~ct ~o .
1125; and
( 2)
hether or not the increased rates
of corJorate inco~e tax prescribed in Ee~ub
lic ... l.ct J.;o . 5l.U 1 s{lould apply to income re-
'~
cei\l:ed beginninb July 1, 1968 by corporations
re)ortin~ income on a calenuar year basis o
On the 1ssue of juri sdiction ,
respo~dent contends
that the issuance of the warrant of distraint and levy
i s considered a decision denying t~e protest of the
petitioner , and Jllrsuant to Section 7, in relation to
Secti on 11 of Le ... mblic ..:l..ct No . 11 25, petitioner should
h&ve appealed to this Court uithin 30 days from August
19 , 1971, the date tne sai~ warrant was served upon it ,
or not later than Se~Jtember 18, 1 9'71 ; and since the
petition for review was filed on uovember 11, 1971, t~e
a~peal was filed out of time .
'rhe reco1'd sl.10'i.1TS th<...t after ti.1e ivarrant of distraint
and levy ivas served on the )etitioner on august 19, 1971,
"resportdent did not enforce the collection tnereof as
evidenced by t: .. e indor se_:1Gnt of the Chief , Collection
.
.
.3r,::.nch dated Septeinber 21 , 1971 , seeii:ing the advice of
the ~~ ssistant ·.e;;ional Director vrhet 1er or not the col-
lection of the tax assessed a6ainst petitioner should be
enforced.
Thereafter , that is , on Octooer 7, 1971 , a
formal decision was rendered denying )etitioner ' s· ]retest.
DECISION
CTI
CA3~ hO . 2345 I t is true that trte issuance of a warrant of distraint and levy to enforce collectiorr of a tax as- sessed against a ta~payer is considered a decision of the Commissioner of Internal nevenue whic~1 is appealable to this Court .
.aut this is true only i.·There no formal deci- sian has been rendered by the Commissioner . '.!.'he reason is t hat where no formal decision is rendered by the Comwissioner of Internal Itevenue on the protest of a taxpayer , tne issuance of a ~arrant of distraint and levy is consitiered as a decision impliedly denyin~ the p1·otest because by the issuance of such \:·Tarrant the Commissioner considers his assessl)lent as final . In this case, a formal decision was actually rendered on peti- tioner 1 s pl'otest so th<?._t the thirty- day period for appeal should be counted from the date of receipt there- of by petitioner and not from the date of service of a copy of tlle \·Tarrant of distraint and leV;<l o de are , therefore , of the opinion tha~ the appeal- able decision is the letter of respondent dated October 7, 1971, which was received by petitioner on October 29 , 1971.
From the date of receipt by petitioner on October 29 , 1971 of res~ondent 1 s decision dated October 7, 1971 to the date of filinz of the petition for review on LOVen1be1" 11 , 1971 , only 13 days el apsed. Consequently, the herein appeal was timely filed . Tne second issue is not one of first impressiono In The Manila Times Publishing Co., Inc . vs . Comm. of
DECISION :
CTA CASE NO. 2345 y) Int. Rev., C.I.A. Case No. 2262, dated December 17; 1973, certiorari denied in G, R. No. 1-38154, May 10, ~° 1974; Phil. Mateh Co., Ltd. vs. The Commissioner of . Internal Revenue, C.T.A. Case No,. 2422, Feb. 19, 1975, and cases cited therein, it was held that the increased ‘rates prescribed in Republic Act No. 5431 are applicable to incomes of a calendar year corporation: beginning. January 1, 1969 and not July 1, 1968, because the begin- ning of the taxable year of calendar year corporations after June 30, 1968 is January 1, 1969, The income of a calendar year corporation from July 1, 1968 to Dec- ember 31, 1968 is still subject to the old rates pres- scribed in Section 24 of the Revenue Code, before its amendment by Republic act iio. 5431. -“WIHBREPORE, the decision appealed from is hereby reversed. No costs.
SO ORDERED.
Quezon City, October 10, 1975.
ROMAN M. UMALI
Presiding Judge
) teg hee W{.
associate Judge RAMON L. AVANCENA
Associate Judge
WE CuNCUR:
(2¢