£ Tuason & Legarda, LTD vs. = the Commissioner of Internal Revenue

DECIS IO N

This is « petition to review the decision of the Commissioner of Internal Revenue requiring peti- tioner Tu«son & Leg«rd«, Ltdo to pay the «mount of ~2 , 814o95 , «s specific tax on distilled spirits and compounded liquor, plus ¥ 3COaOO «s compromise penalty. Petitioner Tuason & Legarda , Ltd., owner and operator of La .H.osario Distillery ( t . s.no PPo 5- 6) j was a licensed distiller until 1938 (t Qs.no p. lOl)o On June 27, 1939 , it became « compounder of liquor (Exh. K- 2, CTA rec. , p. 28; t . son. Po 98) . Since its stocktaking by the Bureau of Internal rlevenue on July 13, 1950, it has ce«sed to operate (Exh. l j BIR reco

p. 8) 0 As e«rly «s 1910 (t.sono pp. 16 «nd 88) 1 peti- tioner h«d Within the compound of L« os«rio Distil- lery gr«in «nd rectified alcohol upon which the corres- ponding specific t«x h«s not been p«id. This stock of «lcohol was carried over from month to month in its offici«l register books (Exh. 1, BI rec. p. 8; Exh.

DECISION -

C. I . A. CASE NO. 746 - 2 - L- l ; CIA rec. p. 29; Exh. M- l , CIA rec. p. 30) . In the course of a spot-checking and ver ification , the BIR special investigators noticed the stock of 998 proof liters of grain alcohol and 72 proof liters of compounded liquor in question (t . s. n. pp. 52- 53). Consequently , they recommended the collection of ¥3 »525. 4q, as specific tax.

{Exh. 1, BL rec. pp.

6- 9) 0 In a letter d~ted December 16, 1958 (Exhs. 2 & A 1 BIR rec . p. 11) and received by petitioner on January 9 1 1959 {see Exhs. 3 & B, BIR rec. p. 22) , re spondent demanded of La Rosario Distillery the pay- ment of 3,525. 401 as specific tax on the stock of alcohol in que stion , plus 300. 00, as compromise penalty.

In reply ther eto; petitioner reque sted res- pondent to send an agent to supervise the de st r uction of grain alcohol and compounded l iquor for the reason that the same were no longer fit for human consumption {Exhs. 3 & B, BIR rec. p. 22) .

In view of this request, a re - investigation of the case was made . The investi- gators found the grain alcohol and compounded liquor in que stion no longer fit for human consumption due to bad odor and t herefore recommended their destruction (Exhs. I y J & J~ l , BIR reco pp. 34- 35) o However 1 a laboratory examination and analysis of the spirits in que stion~ sub ­ sequently conducted by the laboratory section of the Bureau of Internal Revenue , showed that the same were

DECISI ON -

C. T. A. CASE I Oo 746 - 3 - still fit for human consumption (Exhs o 4» 4- , BIR reco p. 38; to s on. p. 66) , and that the alcohol con- tent thereof was at ~arianc e with the entries in pe- titioner's register books.

Hence , on July 3, 1959 , the assessment for specific tax was reduced to · 2, 814. 95 (Exhs o 5 & C, C- lv C- 2, BI rec. PPo 48- 49)o This amended assessment was admittedly received by petitioner on August 12, 1959 (Exhso 6 & D, BI~ re c~ Po 52) o In a letter dated August 15, 1959 (Exhs. 6 & D, BIR r eco Po 52) and filed with re spondent on Augu st 15, 1959 ( see Memorandum f or espondent , CIA reca p.

45) , petitioner r eiterated it s reque st for authority to de st r oy the gri.in alc ohol «nd compounded liquors , invoking the provisions of Section 131 of the N~tional Internal Revenue Code .

Re spondent , in his letter dated September 30~ 1959 (Exhs o 7 & E, BIR rec. p~ 57) and received by petitioner about the middle of October , 1959 (t.sono p. 41) , denied the reque st and again de- manded the payment of 2, 814. 95 as specific taxg plus ~300o00; as c omprom~se penalty.

Once more, petitioner j in it s letter dated Nov- ember 25 , 1959 (Exhs. 8 & F, BIR rec o pp. 59- 60) and received by respondent on November 25, 1959 (see Memo- randum for Respondent , CIA reco p. 45), reque sted that it be allowed to destroy the grain alcohol and com- pounded liquor for the reason that the same were not up to standard (Exhs. 8 & F, BI rec . PPo 59- 60) .

This

DECISIO'-l - C.I.A. CASE NO. 746 - 4 - lettex was nevex answexed by xespondent . Instead , on Decembex 15, 1959, he issued a waxxant of distxaint and levy to enfoxce the collection of the specific tax hexein involved (Exho G, BI xec. p. 68) .

On Febxuaxy

1, 1960, petitionex requested that the waxxant of des- txaint and levy be lifted, and foxmally tendexed all the gxain alcohol and compounded liquor to xespondent in full discharge of the tax sought to be collected (c xh. HR BI xeco Po 72)o On Februaxy 11, 19601 petitioner instituted the instant appeal (CIA rec o p. l)o The issues involved in this c ase are: lo Whether or not the petition for review was filed wi t hin the 3 - day period prescribed in Section 11 of Republic Act No. 1125 ;

nd 2.

hether or not petitioner is liable for the payment of specific tax on its stock of grain alc ohol and compounded liquox.

In his answer to the petition for review, res- pondent r aised the issue of jurisdiction of this Court to t ake cognizance of this case .

He maintains t hat this Court has no j ur i sdiction over t he inst ant c• se i nasmuc h as t he petition for review was filed beyond t he 30- day period pr escribed in Section 11 of epubl i c .· ct No. 1125.

He contends th•t his letter dCited July 3, 1959 whexein he deman ed of pet itioner the payment of the reduced assessment of ~2, 8 14~ 9 5 , plus t he com- promise penalty ., i s the decision which is appeel able ..

u.t.GL::>IU.'l C. I . A. C S- NO, 746 - 5 .....

to this Court .

Hence , he concludes that the 30- day period should be counted from its receipt by peti- , tionero On the other hand, petitioner claims that the petition for review w•s se asonably filedtarguing that the 3 - day period should be counted from anuary 3J, 1960, the date when _it was served the warrant of dis- traint and levy.

Upon the foregoing facts , we find that the amended assessment of July 3, 1959 is the decision which should be appealed to this Courta It is a de- finite determination of petitioner ' s tax liability (-angasinan Transportation Coo, Inc. vs. Blaquera 1 G. • oQ L- 131 l, April 29 , 1960; ~also St . Step- hen's ' ssociation and St. Stephen ' s Chinese Girls School vs . The Collector of Internal Revenue , GoR. 1 o. L- 11238, August 21 , 1958)o Therefore, the period within which to perfect the appeal commenced to run from the receipt of this assessment by petitioner on August 12, 1959.

It was interrupted by the filing on August 15 , 1959 of petitioner' s letter of the same date.

The interruption ended on October 15, 1959 when petitioner received the denial of its request for re- consideration.

At the same time , it resumed to run until interruption once more supervened on November 29 , 1959a All in all , petitioner consumed 44 days, tabu- lated below:

DE I ~I 01 -

.To • CASE N0o 746 - 6 ...

From ujust 12, 1959 - date pe- tition~r · eceived responatnt s decision o ul , 1959 to .. ugust 1 ~ 1959 - date peti- tioner filed its 1st r equest for reconsider ation date u ust 15, 19!:'9 rom Octo er 15, 1959 - d te of receipt by petitioner of respon- dent ' s letter denying its 1st request for reconsideration dated ugust 15, 1959 to l ovember 25 , 1959 - filing of petitioner's 2nd request for reconsider~tion dated Novemoer 25 , 1959 da s - 41 days The instant petition for review havin been filed out of time , this ~ ourt has no jurisdiction to take cognizance of this case.

In view of the finding that this Court h~s no jurisdiction ove the case at bar , we shall not p~ss upon the legality of ~s s essment in question . \vHE.H.EF0KE , the petition for review in this case is hereby dismissed for lack of jurisdiction, With costs against petitionero .

Su OrlD tlliD o ~a nila, February 17, 1961.

rl0v1AN M. Ulv\ALI

Associate Judge

~I

A~o - ~~ 11-\t{ ..... \j £!A&r Pre siding Judge