G.R. No. 139736. October 17, 2005.
Bank of the Philippine Islands, Petitioner, vs. Commissioner of Internal Revenue, Respondent.

FACTS

Petitioner Bank of the Philippine Islands (BPI) sold foreign currency (US$1,000,000) to the Central Bank in 1985. In 1989, the Bureau of Internal Revenue (BIR) issued a deficiency documentary stamp tax (DST) assessment against BPI for these transactions, arguing that the liability for the tax fell on BPI as the seller, despite the Central Bank’s exemption. BPI protested, contending that under prevailing industry practice, the buyer bore the tax cost, and that a 1986 law which explicitly shifted liability to the non-exempt party was not yet effective for 1985 transactions.
The BIR denied BPI’s protest in a letter dated August 13, 1997, which BPI received on September 11, 1997. BPI filed a Petition for Review with the Court of Tax Appeals (CTA) on October 10, 1997. The CTA ruled in favor of BPI, but the Court of Appeals reversed, reinstating the assessment. BPI elevated the case to the Supreme Court.

ISSUE

Whether the Court of Tax Appeals acquired jurisdiction over BPI’s petition, considering the timeliness of its filing following the denial of its protest by the BIR.

RULING

Yes, the CTA validly acquired jurisdiction. The Supreme Court ruled that BPI timely filed its petition within the 30-day period prescribed by law. The period to appeal commenced from BPI’s receipt of the BIR’s final decision denying its protest on September 11, 1997. BPI filed its petition with the CTA on October 10, 1997, which was the 29th day from such receipt. The Court rejected the BIR’s argument that the period should be counted from BPI’s receipt of the earlier warrant of distraint in 1992, as a warrant is a collection tool, not a final decision on a protest appealable to the CTA. A final decision letter from the Commissioner is the requisite appealable order. Since BPI filed within 30 days from receipt of that final denial, the CTA’s jurisdiction was properly invoked. The Supreme Court thus reversed the Court of Appeals and upheld the CTA’s jurisdiction, remanding the case for resolution on the substantive issue of BPI’s tax liability.