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Topic: Documentary Stamp Tax (DST) Justice Antonio Carpio: Bank of the Philippine Islands v. CIR, G.R. No. 181836, July 9, 2014 Facts: The BIR issued assessment against Bank of the Philippine Islands (BPI) for documentary stamp deficiency tax on its sales of foreign bills of exchange to the Central Bank. On June 16, 1989, BPI received the assessment. To which, BPI filed a protest letter on June 23, 1989 requesting for reinvestigation and/or reconsideration of the assessment contending that the same have no factual and legal bases. Moreover, BPI relied upon the ground, among other things, that the DST was for the account of the buyer and since the buyer is exempt from payment of any tax, the seller should not be made to account for the tax. BPI relied upon the fact that Presidential Decree 1994 has yet been made effective on the taxable period covered by the assessment. PD 1994 had shifted payment of DST to the other party in case the buyer is an exempt taxpayer. Thereafter, the protest was denied by the BIR and it argued that the liability for the payment of DST had been shifted to the other party who was not exempt from payment of tax. This is in accordance with a BIR Ruling. Thus, BPI filed a Petition for Review before the CTA. The CTA ruled in favor of BPI. However, the CA reversed the same and ruled in favor of CIR. Hence, BPI elevated the case to the SC. The SC found the assessment subject of the case to have been prescribed yet it ordered both parties to submit their comment on account of due process. Issue: Whether or not the BIR has the right to collect the assessed DST from BPI. Held: No, BIR no longer has the right to collect the same on account of prescription.
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case: toledo 2014
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Topic: Documentary Stamp Tax (DST)Justice Antonio Carpio:Bank of the Philippine Islans !" CI#$ %"#" &o" '('()*$ July +$ ,-'./acts: The BI# issue assessment a0ainst Bank of the Philippine Islans (BPI)for ocumentary stamp e1ciency tax on its sales of forei0n 2ills of exchan0eto the Central Bank"3n June '*$ '+(+$ BPI recei!e the assessment" To 4hich$ BPI 1le aprotest letter on June ,)$ '+(+ re5uestin0 for rein!esti0ation an6orreconsieration of the assessment contenin0 that the same ha!e no factualan le0al 2ases" 7oreo!er$ BPI relie upon the 0roun$ amon0 other thin0s$that the DST 4as for the account of the 2uyer an since the 2uyer is exemptfrom payment of any tax$ the seller shoul not 2e mae to account for thetax" BPI relieuponthefact thatPresiential Decree'++.hasyet2eenmae e8ecti!e on the taxa2le perio co!ere 2y the assessment" PD '++.hashiftepayment of DSTtotheother partyincasethe2uyer isanexempt taxpayer"Thereafter$ the protest 4as enie 2y the BI# an it ar0ue that thelia2ility for the payment of DST ha 2een shifte to the other party 4ho 4asnot exempt from payment of tax" This is in accorance 4ith a BI# #ulin0"Thus$ BPI 1le a Petition for #e!ie4 2efore the CTA" The CTA rule infa!or of BPI" 9o4e!er$ the CA re!erse the same an rule in fa!or of CI#"9ence$ BPI ele!atethecasetotheSC" TheSCfountheassessmentsu2:ect of the case to ha!e 2een prescri2e yet it orere 2oth parties tosu2mit their comment on account of ue process"Issue: ;hether or not the BI# has the ri0ht to collect the assesse DST fromBPI"9el: &o$ BI#nolon0erhastheri0ht tocollect thesameonaccount ofprescription"If the pleain0s or the e!ience on recor sho4 that the claim is 2arre2y prescription$ the court is manate to ismiss the claime!en ifprescription is notraise asa efense" In 9eirs ofscomplaint$ or other4ise esta2lishe 2y the e!ience" ?ner the thenapplica2le Section )'+(c) @no4$ ,,,(c)Aof the &ational Internal #e!enue Coe(&I#C) of '+BB$ as amene$ anyinternal re!enuetax4hichhas 2eenassesse 4ithin the perio of limitation may 2e collecte 2y istraint or le!y$an6or court proceein0 4ithin three years follo4in0 the assessment of thetax" The assessment of the tax is eeme mae an the threeCyear periofor collection of the assesse tax 2e0ins torun on the ate the assessmentnotice ha 2een release$ maile or sent 2y the BI# to the taxpayer"In the present case$ althou0h there 4as no alle0ation as to 4hen theassessment notice ha 2een release$ maile or sent to BPI$ still$ the latestate that the BI# coul ha!e release$ maile or sent the assessment notice4asontheateBPI recei!ethesameon'*June'+(+" Countin0thethreeyearprescripti!e perio from '* June'+(+$the BI# ha until'D June'++, to collect the assesse DST" But espite the lapse of 'D June '++,$ thee!ience esta2lishe that there 4as no 4arrant of istraint or le!y ser!e onBPI>s properties$ or any :uicial proceein0s initiate 2y the BI#"The earliest attempt of the BI# to collect the tax 4as 4hen it 1le itsans4er in the CTA on ,) /e2ruary '+++$ 4hich 4as se!eral years 2eyon thethreeCyear prescripti!e perio" 9o4e!er$ the BI#>s ans4er in the CTA 4as notthe collection casecontemplate 2y the la4" Before ,--. or the year #epu2licAct &o" +,(, took e8ect$ the :uicial action to collect internal re!enue taxesfell uner the :urisiction of the re0ular trial courts$ an not the CTA"E!iently$ prescription has set in to 2ar the collection of the assesse DST"Petition 0rante"
