GR 238914; (June, 2020) (Digest)
G.R. No. 238914 , June 08, 2020
Qatar Airways Company with Limited Liability, Petitioner, vs. Commissioner of Internal Revenue, Respondent.
FACTS
Petitioner Qatar Airways filed its 2nd Quarterly Income Tax Return for Fiscal Year ending March 31, 2012, and paid the corresponding tax due of P29,540,836.00 one day late on November 30, 2011. The Bureau of Internal Revenue (BIR) issued an assessment notice imposing a 25% surcharge of P7,385,209.00, interest for late payment, and a compromise penalty. Petitioner paid the interest and compromise penalty but requested abatement of the surcharge, arguing the late filing was due to a technical failure (faulty internet connection) on the last day of filing, November 29, 2011, and was done in good faith. The BIR denied the abatement request, finding no advice of eFPS unavailability on that day and noting the return was filed the following afternoon, not the first working hour. The BIR also stated petitioner had a 60-day filing period and could have filed earlier. Petitioner’s subsequent requests for reconsideration were denied, with the BIR’s April 3, 2014 letter stating the denial was final. Petitioner filed a Petition for Review before the Court of Tax Appeals (CTA) on May 8, 2014.
ISSUE
Whether the Court of Tax Appeals En Banc correctly affirmed the denial of the abatement of the 25% surcharge imposed on petitioner for late filing of its quarterly income tax return.
RULING
Yes. The Supreme Court affirmed the CTA En Banc’s decision denying the abatement. The Court upheld the CTA’s expertise and found no abuse of authority. The surcharge was imposed pursuant to Section 248(A)(1) of the 1997 National Internal Revenue Code for failure to file and pay on time. The authority to abate under Section 204(B) and Revenue Regulations No. 13-2001 requires the tax or penalty to be unjustly or excessively assessed. The Court agreed with the CTA that the delay was not due to circumstances beyond petitioner’s control, as there was no reported eFPS technical problem on the deadline date, and petitioner could have filed its return earlier within the 60-day period or filed a tentative return if unsure of the computation. The surcharge, being a statutory penalty for late filing, was neither unjust nor excessive. The law must be applied despite petitioner’s claimed circumstances.