G.R. No. 38375 . December 22, 1933.
Jose Sy Jong Chuy, Manager of Hoa Hin & Co., Inc., plaintiff-appellee, vs. Pablo C. Reyes, Special Deputy of the Collector of Internal Revenue, defendant-appellant.

FACTS

The defendant, a special deputy of the Collector of Internal Revenue, issued a subpoena duces tecum to the plaintiff, manager of Hoa Hin & Co., Inc., requiring him to bring the corporation’s 53 Chinese books of account for the years 1925-1928 to the Internal Revenue Office in Cebu for an income tax investigation. The plaintiff refused, offering instead to make the books available for inspection at the corporation’s own offices. The defendant insisted on compliance with the subpoena and threatened contempt proceedings, leading the plaintiff to file this action. The parties submitted the case for decision on a stipulation of facts.

ISSUE

Was the subpoena duces tecum issued by the special deputy of the Collector of Internal Revenue properly issued in accordance with law?

RULING

No. The Supreme Court affirmed the trial court’s decision, declaring the subpoena duces tecum improperly issued. The power to issue such a subpoena under the Administrative Code is not unlimited; it must be exercised reasonably. The subpoena here was unreasonable because it required the production of all the corporation’s principal account books for four years at a distant office, which would disrupt its business, when the revenue officer could conveniently inspect them at the corporation’s premises as offered. The subpoena was also defective in form, being a general mimeographed form that did not specify the particular documents needed. The Court held that the right to inspect books for tax purposes does not justify an unreasonable demand for their removal from the owner’s place of business.

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