G.R. No. L-17177-80 December 28, 1964
People of the Philippines, plaintiff-appellee, vs. Ildefonso Tierra, defendant-appellant.

FACTS

Ildefonso Tierra was charged in four separate informations for violations of the income tax law. The first information alleged that for the year 1946, he filed a false return stating an income of P19,196.14 when his actual net income was P93,886.55, and refused to pay the deficiency tax of P30,632.51. The second information similarly charged him for 1947, declaring P65,225.41 when his actual net income was P621,072.80. The third information charged him, as president of “Ildefonso Tierra & Sons, Inc.”, for filing a false corporate return for 1949, declaring P24,833.47 when the actual net income was P359,310.18. The fourth information charged him with failure to keep and preserve books of account for at least five years as required by law. The cases were jointly tried. The Manila Court of First Instance found him guilty on all counts, imposing fines, imprisonment, and ordering him to indemnify the government for the deficiency taxes. Tierra appealed to the Court of Appeals, which certified the case to the Supreme Court as it raised only questions of law. The facts established that Tierra filed returns for 1946, 1947, and 1949 but could not produce all pertinent accounting records during investigation. The examiner, using the “percentage basis” method, determined underreported incomes. Formal demands for deficiency taxes were made on December 23, 1950, and assessment notices were sent on December 29, 1950. The informations were filed on December 12, 1955.

ISSUE

1. Whether the informations are void for not stating an offense.
2. Whether the right to prosecute had prescribed.
3. Whether the criminal liability was extinguished by the alleged prescription of the civil liability to pay taxes.
4. Whether Section 51(d) of the National Internal Revenue Code, upon which the first three informations were based, had been repealed, barring prosecution.

RULING

1. The informations are not void. The objection that they failed to allege specific details like citizenship, age, or residence is without merit. Alleging the income was sufficient, as filing a return implied the defendant was bound to make it.
2. The actions had not prescribed. Under Section 354 of the National Internal Revenue Code, prescription begins from the day of commission or, if not known, from discovery. The trial court found the falsity was discovered only on December 16, 1950. Since the informations were filed on December 12, 1955, the five-year period was not exceeded. Prescription is a matter of defense and need not be alleged in the information.
3. The criminal liability was not extinguished by any alleged prescription of the civil liability. The duty to pay tax is independent of attempts to evade payment. Satisfaction of civil liability (by payment or prescription) does not extinguish criminal liability under the National Internal Revenue Code or the Revised Penal Code. The government’s failure to enforce civil collection does not bar criminal prosecution.
4. The repeal of Section 51(d) by Republic Act No. 2343 does not bar prosecution. The accused was charged not only under Section 51(d) but also under Sections 45 and 46 in relation to Section 73 for filing false and fraudulent returns. The indictments can stand even without alleging a violation of Section 51(d).
The Supreme Court affirmed the conviction but modified the judgment by eliminating the portions ordering payment of monetary indemnity to the government, following the precedent in People vs. Arnault that the tax cannot be collected in the criminal proceeding. The penalties of fine and imprisonment were upheld.