GR 210238; (January, 2020) (Digest)
G.R. No. 210238 . January 06, 2020.
IMELDA SZE, SZE KOU FOR, & TERESITA NG, PETITIONERS, VS. BUREAU OF INTERNAL REVENUE, REPRESENTED BY THE COMMISSIONER OF INTERNAL REVENUE, RESPONDENTS.
FACTS
The Bureau of Internal Revenue (BIR) issued Revenue Regulation 8-2001 (Voluntary Assessment Program or VAP). Chiat Sing Cardboard Corporation (Chiat Corp.) availed of the VAP for 1999 and 2000. Subsequently, the BIR issued a Letter of Authority to examine Chiat Corp.’s books for 1999 and 2000. Chiat Corp. failed to present the required documents. The BIR’s investigation revealed that Chiat Corp. underdeclared sales and income, failed to withhold taxes, and understated tax liabilities by over 30% for 1999 and 2000. The BIR issued assessment notices, which became final and executory due to Chiat Corp.’s failure to protest. The BIR then charged the corporate officers, petitioners Imelda Sze, Sze Kou For, and Teresita Ng, with tax evasion. The Department of Justice (DOJ) initially dismissed the complaint. The BIR filed a petition for certiorari with the Court of Appeals (CA). The CA granted the petition, found probable cause for tax evasion, and ordered the DOJ to file the corresponding Information. Petitioners elevated the case to the Supreme Court. While the petition was pending, an Amended Information was filed against petitioners in the Court of Tax Appeals (CTA). The CTA dismissed the criminal cases on the ground of prescription, a decision which became final and executory. Petitioners then argued that the issues before the Supreme Court had become moot and academic.
ISSUE
Whether or not the CA erred in finding probable cause for violation of the National Internal Revenue Code.
RULING
The Supreme Court dismissed the petition for being moot and academic. The Court held that the dismissal of the criminal cases by the CTA on the ground of prescription rendered the issue on the propriety of the CA’s finding of probable cause moot. A case becomes moot when a supervening event negates the need for adjudication, as no practical legal relief can be granted. Since the CTA’s dismissal had become final and executory, a ruling on the CA’s decision would serve no useful purpose. The Court therefore abstained from passing upon the merits of the petition.