GR 211449; (January, 2019) (Digest)
G.R. No. 211449 January 16, 2019
COMMISSIONER OF INTERNAL REVENUE, Petitioner, vs. TRANSFIELD PHILIPPINES, INC., Respondent.
FACTS
The Commissioner of Internal Revenue (CIR) issued Final Assessment Notices (FANs) to Transfield Philippines, Inc. for deficiency income tax, expanded withholding tax, and value-added tax for fiscal year 2001-2002, totaling over P563 million. Transfield filed a protest but, without awaiting a resolution, the Bureau of Internal Revenue (BIR) issued collection letters and a Final Notice Before Seizure. Subsequently, Transfield availed of the tax amnesty under Republic Act No. 9480 by submitting all required documents, including a Notice of Availment, Tax Amnesty Return, Statement of Assets and Liabilities, and a Tax Amnesty Payment Form, and paid the amnesty tax of P112,500. It informed the BIR of this availment.
The CIR, however, issued a Warrant of Distraint and/or Levy (WDAL) against Transfield, citing Revenue Memorandum Circular No. 19-2008 which disqualified taxpayers with delinquent accounts from the amnesty. Transfield then filed a petition with the Court of Tax Appeals (CTA) seeking to nullify the WDAL, arguing its tax liabilities were extinguished by its valid amnesty availment.
ISSUE
Whether Transfield Philippines, Inc.’s valid availment of the tax amnesty under R.A. No. 9480 extinguished its tax liabilities and rendered the subsequent Warrant of Distraint and/or Levy void.
RULING
Yes. The Supreme Court affirmed the CTA En Banc’s decision, ruling that Transfield’s compliance with all the requirements of R.A. No. 9480 granted it immunity from the payment of the assessed taxes. The legal logic is anchored on the nature of a tax amnesty as a general pardon for tax liabilities, conditioned solely upon the taxpayer’s fulfillment of the statutory requirements. The Court emphasized that the law itself does not disqualify taxpayers with pending assessments or delinquent accounts; it applies to all internal revenue taxes for taxable year 2005 and prior years. Once a taxpayer submits the required documents and pays the amnesty tax, the suspensive condition is fulfilled, and the tax liabilities are deemed settled.
The CIR’s reliance on a revenue memorandum circular to disqualify Transfield was invalid, as an administrative issuance cannot amend or restrict the clear coverage of the law. The WDAL was therefore issued without legal basis. Furthermore, the Court clarified that Transfield’s act of filing a protest to the FANs did not preclude it from availing of the amnesty, and it was not required to first appeal the assessments to the CTA before enjoying the amnesty’s immunities. Its immediate compliance with the amnesty law’s conditions entitled it to the benefits thereof, barring any further collection efforts for the covered periods.