GR 113703; (January, 1997) (Digest)
G.R. No. 113703 . January 31, 1997.
COMMISSIONER OF INTERNAL REVENUE, petitioner, vs. A. SORIANO CORPORATION, COURT OF TAX APPEALS and COURT OF APPEALS, respondents.
FACTS
A. Soriano Corporation (ANSCOR) filed a petition with the Court of Tax Appeals (CTA) for a refund of excess income tax payments totaling P1,399,941.45 for the years 1985 and 1986. During the trial, ANSCOR presented evidence to substantiate its claim. The Commissioner of Internal Revenue (CIR) did not object to the existence of the documents but reserved objections to their contents and purposes. The CIR then submitted the case for decision based solely on ANSCOR’s evidence without presenting any countervailing evidence.
The CTA granted ANSCOR’s petition and ordered the issuance of a tax credit memorandum. The CIR filed a motion for reconsideration, seeking to admit a BIR investigation report dated September 18, 1991, which purportedly showed a much lower refundable amount. The CTA denied the motion, characterizing the report as “forgotten evidence” that was in the possession of the CIR’s subordinate during trial and not newly discovered. The Court of Appeals affirmed the CTA’s decision.
ISSUE
Whether the CTA should reopen the case to allow the CIR to present the BIR investigation report as newly discovered evidence.
RULING
The Supreme Court denied the petition and affirmed the Court of Appeals. The BIR report does not qualify as newly discovered evidence warranting a new trial. Under the Rules of Court, applicable via the CTA Rules, newly discovered evidence must have been discovered after trial, could not have been discovered and produced at trial with reasonable diligence, and must be of such weight that it would probably change the judgment.
The Court agreed with the lower courts that the report was not newly discovered. The CIR failed to prove that the report could not have been prepared and presented during the four years the case was pending before the CTA. The report was in the personal possession of a BIR officer during the trial period. The CIR’s failure to present it constituted simple negligence. A liberal application of procedural rules to admit the report would reward negligence and undermine the stability of judicial decisions. The CIR’s chosen strategy of not presenting evidence during trial and attempting to introduce it after an adverse decision was a calculated risk that must bear its consequences.