MANILA – The Court of Tax Appeals (CTA) has voided a tax assessment worth more than PHP10 million against a local sports apparel firm for failure of Bureau of Internal Revenue (BIR) officers to properly issue an assessment notice, which denied the firm due process.
In the 18-page decision dated Nov. 6 written by Associate Justice Maria Modesto-San Pedro, the tax court's Second Division granted the petition filed by the Star Sports Corp. and nullified the assessment against the firm in 2014 amounting to PHP10.86 million.
The court noted that as revenue officials failed to properly serve the assessment notices to petitioner, the assailed assessment is void.
"As the assailed assessment is void, due to a violation of petitioner's right to due process, the assailed WDL (warrant of distraint and levy) is also void," .
The court said it could not act on the basis of an incident report filed by Revenue Officer (RO) Fritz Manabilang who discovered after she returned from an official leave that the records of the case left in the office filing cabinet had been tampered with and that among those missing were the "received" copies of the Preliminary Assessment Notice (PAN) and Final Assessment Notice (FAN).
She claimed that the BIR’s records for 2014 had been removed and that the straw rope binding the records together was left untied and that her office had been unable to locate the PAN and FAN despite efforts to do so.
“The Incident Report and RO Manabilang's testimony, however, are insufficient to discharge respondent (BIR)'s burden to prove petitioner's receipt of the PAN and FAN," the court said.
"In ruling on the merits of this case, the Court cannot make use of issuances or proofs of service to which We have no access. We can only consider what is before Us. Unfortunately for respondents (BIR), what is before us leads to the conclusion that petitioner (Star Sports) did not, in fact, receive the PAN or FAN," the court said. (PNA)
