G.R. No. 221780, March 25, 2019.
SC Third Division
PERALTA, J.:
Lessons Applicable: doctrine of exhaustion of administrative remedies, petition for review on certiorari under rule 45
Laws Applicable: Section 228 of the NIRC, RR 12-99, rule 45
FACTS:
- September 9, 2009: Bureau of Internal Revenue (BIR) issued a Preliminary Assessment Notice (PAN) against V.Y. Domingo for P2,781,844.21 representing deficiency income tax and value-added tax, inclusive of interest, for the taxable year 2006.
- V.Y. Domingo then received a Preliminary Collection Letter (PCL) dated August 10, 2011 from the Revenue District Office (RDO) No. 28 – Novaliches pursuant to Assessment Notice No. 32-06-IT-0242 and Assessment Notice No. 32-06-VT-0243, both dated November 18, 2010, for collection for the total amount of P3,164,617.43.
- September 15, 2011: V.Y. Domingo received the certified true copies of Assessment Notice Nos. 32-06-IT-0242 and 32-06-VT-0243 which it requested through a letter on September 12, 2011.
- September 16, 2011: V.Y. Domingo filed a Petition for Review with the CTA in Division, under Section 7(1) of RA No. 1125 and Section 4, Rule 8 of the Revised Rules of the Court of Tax Appeals (RRCTA), praying that Assessment Notice Nos. 32-06-IT-0242 and 32-06-VT-0243 dated November 18, 2010 and the PCL dated August 10, 2011 be declared void for been issued beyond the prescriptive period for assessment and collection
- CTA En Banc: granted reversing Resolutions of the CTA First Division and remanded the case to the CTA First Division for further proceedings to afford the CIR full opportunity to present her evidence
- CIR filed a Petition for review on certiorari under Rule 45
HELD: Grants. Resolution of the CTA reinstated.
NO. V.Y. Domingo's immediate recourse to the CTA First Division was in violation of the doctrine of exhaustion of administrative remedies.
- CTA, being a court of special jurisdiction, can take cognizance only of matters that are clearly within its jurisdiction. Section 7 of R.A. No. 1125, as amended by R.A. No. 9282, specifically provides:
(a) Exclusive appellate jurisdiction to review by appeal, as herein provided:
(1) Decisions of the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of internal revenue taxes, fees or other charges, penalties in relation thereto, or other matters arising under the National Internal Revenue Code or other laws, administered by the Bureau of Internal Revenue; xxx”
- In relation thereto, Section 228 of R.A. No. 8424 or The Tax Reform Act of 1997, as amended, implemented by Revenue Regulations No. 12-99, provides for the procedure to be followed in issuing tax assessments and in protesting the same.
- Section 228 of the Tax Code requires taxpayers to exhaust administrative remedies by filing a request for reconsideration or reinvestigation within 30 days from receipt of the assessment.
- Assessment Notice Nos. 32-06-IT-0242 and 32-06-VT-0243 dated November 18, 2010 have not been disputed by V.Y. Domingo at the administrative level without any valid basis therefor, in violation of the doctrine of exhaustion of administrative remedies. To reiterate, what is appealable to the CTA are decisions of the CIR on the protest of the taxpayer against the assessments. Consequently, the non-filing of the protest against the FLD (30 days from September 15, 2011 - when it received a copy of it) let to the finality of the assessment.