Court of Tax Appeals
0Cantilan Lumber Company vs. = the Commissioner of Internal Revenue
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REPURi,JC OF THE PHILlP:Pl~ES
COURT OF TAX APPEALS
QUEZON CITY
CAr TILAN LUNBER COlviPANY,
Petitioner ,
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THE COW1ISSIONER OF I NTERNAL
REVENDE ,
Respondent .
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C.T.A. C SE NO . 2454
This is an appeal from the decision of res-
pondent dated
ctober 22 , 1972 denying petitioner ' s
request to set aside the assessment in the amount
of ~2 1, 02 6 . 26 as deficiency income tax for the year
1968.
Petitioner i s a corporation dul y org.anized and
existing by virtue of the laws of the Philippines .
It files its income tax returns on the fiscal year
basis , its taxable year commencing November 1 and
ending October 31 of the f ollowing year .
For the
fiscal year 1967- 68 (November 1, 1967 to October 31,
1968) , p e titi~ne r computed its income tax on the
basis of the old rates of 22% and 307'~ , as pres-
cribed in Section 24 of the Revenue Code , prior to
its amendment by Rep ublic Act 5431 which provides
that the Uprovisions of thi s Act shall apply to in-
come for taxable years beginning after
June 30,
1968. n
Hm.vever, respondent computed the income tax
of petitioner based on the new rates with re spect
DECISION
CTA CASE NO . 2454 to i t s income earned from July 1 , 1968 to October - 31 , 1963 .
As a result , respondent assessed against petitioner a deficiepcy income tax of ~21 , 026 . 26 inclusive of interest .
This was protested but was denied by respondent in his decision dated October 2, 1972 .
Hence , this appeal .
The sole issue in this case is purely one of law, i . e ., whether or not the increased rates of corporate income tax of 25~!.1- 35% tax prescribed in Republic Act No . 5431 should apply to petitioner ' s income received from July 1 , 1968 to October 31 ,
1968 .
As the taxable year of petitioner begins on November 1 , the beginning of its taxable year after June 30 , 1968 , is November 1 , 1968 and not July 1 ,
1968 .
Accordingly , it was error for respondent to apply the nevi corporate income tax rates on the income of petitioner beginning July 1 , 1968 . (See Ivlanila Times Publishing Co., Inc . vs . Comm . of Int . Rev ., C. T. A. Case No . 2263 , December 17, 1973, cert . denied in G.R. No . 1- 38154, Nay 10, 1974; Philippine Match Co . , Ltd . vs . The Comm. of Int . Rev . , C. T. Ao Case No . 2422 , February 19, 1975 , and cases cited therein . )
\VHEREFORE, the decision appealed from is hereby reversed .
No pronouncement as to costs .
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DECISION -
CT CASE
O. 2454 3
SO ORDERED .
uezon City , October 1 , 1975 vJE CONCU ~----., RO!v'Jl N. Uti LI Pr esiding
Judge
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I ~EO IJ" L.
VANCEN
Associate Judge.