9/10/2017 G.R. No.

178087

RepublicofthePhilippines
SupremeCourt
Manila


SECONDDIVISION


COMMISSIONEROFINTERNAL G.R.No.178087
REVENUE,
Petitioner, Present:

CARPIO,J.,Chairperson,
BRION,
versus DELCASTILLO,
ABAD,and
PEREZ,JJ.

KUDOSMETALCORPORATION, Promulgated:
Respondent. May5,2010
xx


DECISION


DELCASTILLO,J.:

[1]
The prescriptive period on when to assess taxes benefits both the government and the taxpayer.
Exceptionsextendingtheperiodtoassessmust,therefore,bestrictlyconstrued.

[2]
ThisPetitionforReviewonCertiorariseekstosetasidetheDecision datedMarch30,2007
oftheCourtofTaxAppeals(CTA)affirmingthecancellationoftheassessmentnoticesforhavingbeen
[3]
issuedbeyondtheprescriptiveperiodandtheResolution datedMay18,2007denyingthemotionfor
reconsideration.
FactualAntecedents

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OnApril15,1999, respondent Kudos Metal Corporation filed its Annual Income Tax Return
(ITR)forthetaxableyear1998.

PursuanttoaLetterofAuthoritydatedSeptember7,1999,theBureauofInternalRevenue(BIR)
serveduponrespondentthreeNoticesofPresentationofRecords.Respondent failed to comply with
thesenotices,hence,theBIRissuedaSubpeonaDucesTecumdatedSeptember 21, 2006, receipt of
whichwasacknowledgedbyrespondentsPresident,Mr.ChanChingBio,inaletterdatedOctober20,
2000.

Areviewandauditofrespondentsrecordsthenensued.

OnDecember10,2001,NeliaPasco(Pasco),respondentsaccountant,executedaWaiverofthe
[4]
DefenseofPrescription, whichwasnotarizedonJanuary22,2002,receivedbytheBIREnforcement
ServiceonJanuary31,2002andbytheBIRTaxFraudDivisiononFebruary4,2002,andacceptedby
theAssistantCommissioneroftheEnforcementService,PercivalT.Salazar(Salazar).
[5]
This was followed by a second Waiver of Defense of Prescription executed by Pasco on
February 18, 2003, notarized on February 19, 2003, received by the BIR Tax Fraud Division on
February28,2003andacceptedbyAssistantCommissionerSalazar.

OnAugust25,2003,theBIRissuedaPreliminaryAssessmentNoticeforthetaxableyear1998
againsttherespondent.ThiswasfollowedbyaFormalLetterofDemandwithAssessmentNoticesfor
taxable year 1998, dated September 26, 2003 which was received by respondent on November 12,
2003.
Respondent challenged the assessments by filing its Protest on Various Tax Assessments on
December 3, 2003 and its Legal Arguments and Documents in Support of Protests against Various
AssessmentsonFebruary2,2004.

[6]
OnJune22,2004,theBIRrenderedafinalDecision onthematter,requestingtheimmediate
paymentofthefollowingtaxliabilities:

KindofTaxAmount
IncomeTaxP9,693,897.85
VAT13,962,460.90
EWT1,712,336.76
WithholdingTaxCompensation247,353.24
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Penalties8,000.00
TotalP25,624,048.76


RulingoftheCourtofTaxAppeals,SecondDivision

Believingthatthegovernmentsrighttoassesstaxeshadprescribed,respondentfiledonAugust
[7] [8]
27,2004aPetitionforReview withtheCTA.PetitionerinturnfiledhisAnswer.
OnApril11,2005,respondentfiledanUrgentMotionforPreferentialResolutionoftheIssueon
[9]
Prescription.

[10]
OnOctober4,2005,theCTASecondDivisionissuedaResolution cancelingtheassessment
noticesissuedagainstrespondentforhavingbeenissuedbeyondtheprescriptiveperiod.It found the
first Waiver of the Statute of Limitations incomplete and defective for failure to comply with the
provisionsofRevenueMemorandumOrder(RMO)No.2090.Thus:
First,theAssistantCommissionerisnottherevenueofficialauthorizedtosignthewaiver,asthe
taxcaseinvolvesmorethanP1,000,000.00.Inthisregard,onlytheCommissionerisauthorizedtoenter
intoagreementwiththepetitionerinextendingtheperiodofassessment

Secondly,thewaiverfailedtoindicatethedateofacceptance.Suchdateofacceptanceisnecessary
todeterminewhethertheacceptancewasmadewithintheprescriptiveperiod

Third,thefactofreceiptbythetaxpayerofhisfilecopywasnotindicatedontheoriginalcopy.
The requirement to furnish the taxpayer with a copy of the waiver is not only to give notice of the
existenceofthedocumentbutalsooftheacceptancebytheBIRandtheperfectionoftheagreement.

The subject waiver is therefore incomplete and defective. As such, the threeyear prescriptive
[11]
periodwasnottolledorextendedandcontinuedtorun.xxx


Petitioner moved for reconsideration but the CTA Second Division denied the motion in a
[12]
Resolution datedApril18,2006.

RulingoftheCourtofTaxAppeals,EnBanc

Onappeal,theCTAEnBancaffirmedthecancellationoftheassessmentnotices.Althoughitruledthat
the Assistant Commissioner was authorized to sign the waiver pursuant to Revenue Delegation
AuthorityOrder(RDAO)No.0501,itfoundthatthefirstwaiverwasstillinvalidbasedonthesecond

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and third grounds stated by the CTA Second Division. Pertinent portions of the Decision read as
follows:

While the Court En Banc agrees with the second and third grounds for invalidating the first
waiver, it finds that theAssistant Commissioner of the Enforcement Service is authorized to sign the
waiverpursuanttoRDAONo.0501,whichprovidesinpartasfollows:

A.ForNationalOfficecases

DesignatedRevenueOfficial

1.AssistantCommissioner(ACIR),Fortaxfraudandpolicy
EnforcementServicecases

2.ACIR,LargeTaxpayersServiceForlargetaxpayerscases
other than those cases falling under Subsection B
hereof

3.ACIR,LegalServiceForcasespending
verificationandawaiting
resolutionofcertainlegalissuespriortoprescriptionandfor
issuance/complianceofSubpoenaDucesTecum

4.ACIR,AssessmentService(AS)Forcaseswhichare
pendinginorsubjectto
revieworapprovalbytheACIR,AS

Basedontheforegoing,theAssistantCommissioner,EnforcementServiceisauthorizedtosign
waiversintaxfraudcases.Aperusaloftherecordsrevealsthattheinvestigationofthesubjectdeficiency
taxesinthiscasewasconductedbytheNationalInvestigationDivisionoftheBIR,whichwasformerly
namedtheTaxFraudDivision.Thus,thesubjectassessmentisataxfraudcase.

Nevertheless,thefirstwaiverisstillinvalidbasedonthesecondandthirdgroundsstatedbythe
CourtinDivision.Hence,itdidnotextendtheprescriptiveperiodtoassess.

Moreover, assuming arguendo that the first waiver is valid, the second waiver is invalid for
violatingSection222(b)ofthe1997TaxCodewhichmandatesthattheperiodagreeduponinawaiverof
thestatutecanstillbeextendedbysubsequentwrittenagreement,providedthatitisexecutedpriortothe
expiration of the first period agreed upon. As previously discussed, the exceptions to the law on
prescriptionmustbestrictlyconstrued.

Inthecaseatbar,theperiodagreeduponinthesubjectfirstwaiverexpiredonDecember31,2002.
ThesecondwaiverintheinstantcasewhichwassupposedtoextendtheperiodtoassesstoDecember31,
2003wasexecutedonFebruary18,2003andwasnotarizedonFebruary19,2003.Clearly,thesecond
waiverwasexecutedaftertheexpirationofthefirstperiodagreedupon.Consequently,thesamecouldnot
[13]
havetolledthe3yearprescriptiveperiodtoassess.


Petitionersoughtreconsiderationbutthesamewasunavailing.

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Issue

Hence,thepresentrecoursewherepetitionerinterposesthat:

THE COURT OF TAX APPEALS ENBANC ERRED IN RULING THAT THE GOVERNMENTS
[14]
RIGHTTOASSESSUNPAIDTAXESOFRESPONDENTPRESCRIBED.


PetitionersArguments

Petitionerarguesthatthegovernmentsrighttoassesstaxesisnotbarredbyprescriptionasthe
twowaiversexecutedbyrespondent,throughitsaccountant,effectivelytolledorextendedtheperiod
withinwhichtheassessmentcanbemade.IndisputingtheconclusionoftheCTAthatthewaiversare
invalid,petitionerclaimsthatrespondentisestoppedfromadoptingapositioncontrarytowhatithas
previouslytaken.Petitionerinsiststhatbyacquiescingtotheauditduringtheperiodspecifiedinthe
waivers,respondentledthegovernmenttobelievethatthedelayintheprocesswouldnotbeutilized
againstit.Thus,respondentmaynolongerrepudiatethevalidityofthewaiversandraisetheissueof
prescription.

RespondentsArguments

RespondentmaintainsthatprescriptionhadsetinduetotheinvalidityofthewaiversexecutedbyPasco,
whoexecutedthesamewithoutanywrittenauthorityfromit,inclearviolationofRDAONo.501.As
to the doctrine of estoppel by acquiescence relied upon by petitioner, respondent counters that the
principleofequitycomesintoplayonlywhenthelawisdoubtful,whichisnotpresentintheinstant
case.

OurRuling

Thepetitionisbereftofmerit.

[15]
Section 203 of the National Internal Revenue Code of 1997 (NIRC) mandates the
governmenttoassessinternalrevenuetaxeswithinthreeyearsfromthelastdayprescribedbylawfor
thefilingofthetaxreturnortheactualdateoffilingofsuchreturn,whichevercomeslater.Hence,an

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assessment notice issued after the threeyear prescriptive period is no longer valid and effective.
[16]
ExceptionshoweverareprovidedunderSection222 oftheNIRC.

The waivers executed by respondents accountant did not
extendtheperiodwithinwhichtheassessmentcanbemade


Petitioner does not deny that the assessment notices were issued beyond the threeyear
prescriptiveperiod,butclaimsthattheperiodwasextendedbythetwowaiversexecutedbyrespondents
accountant.

Wedonotagree.

Section222(b)oftheNIRCprovidesthattheperiodtoassessandcollecttaxesmayonlybe
extendeduponawrittenagreementbetweentheCIRandthetaxpayerexecutedbeforetheexpirationof
[17] [18]
thethreeyearperiod.RMO2090 issuedonApril4,1990andRDAO0501 issuedonAugust
2,2001laydowntheprocedurefortheproperexecutionofthewaiver,towit:

1.ThewaivermustbeintheproperformprescribedbyRMO2090.Thephrasebutnot
after ______ 19 ___, which indicates the expiry date of the period agreed upon to
assess/collectthetaxaftertheregularthreeyearperiodofprescription,shouldbefilled
up.

2. The waiver must be signed by the taxpayer himself or his duly authorized
representative.Inthecaseofacorporation,thewaivermustbesignedbyanyofits
responsible officials. In case the authority is delegated by the taxpayer to a
representative,suchdelegationshouldbeinwritinganddulynotarized.

3.Thewaivershouldbedulynotarized.

4.TheCIRortherevenueofficialauthorizedbyhimmustsignthewaiverindicatingthat
theBIRhasacceptedandagreedtothewaiver.ThedateofsuchacceptancebytheBIR
should be indicated. However, before signing the waiver, the CIR or the revenue
officialauthorizedbyhimmustmakesurethatthewaiverisintheprescribedform,
dulynotarized,andexecutedbythetaxpayerorhisdulyauthorizedrepresentative.
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5.BoththedateofexecutionbythetaxpayeranddateofacceptancebytheBureaushould
bebeforetheexpirationoftheperiodofprescriptionorbeforethelapseoftheperiod
agreeduponincaseasubsequentagreementisexecuted.

6.Thewaivermustbeexecutedinthreecopies,theoriginalcopytobeattachedtothe
docketofthecase,thesecondcopyforthetaxpayerandthethirdcopyfortheOffice
acceptingthewaiver.Thefactofreceiptbythetaxpayerofhis/herfilecopymustbe
indicatedintheoriginalcopytoshowthatthetaxpayerwasnotifiedoftheacceptance
[19]
oftheBIRandtheperfectionoftheagreement.

Aperusalofthewaiversexecutedbyrespondentsaccountantrevealsthefollowinginfirmities:

1.ThewaiverswereexecutedwithoutthenotarizedwrittenauthorityofPascotosign
thewaiverinbehalfofrespondent.

2.Thewaiversfailedtoindicatethedateofacceptance.

3.Thefactofreceiptbytherespondentofitsfilecopywasnotindicatedintheoriginal
copiesofthewaivers.

Due to the defects in the waivers, the period to assess or collect taxes was not extended.
Consequently,theassessmentswereissuedbytheBIRbeyondthethreeyearperiodandarevoid.

Estoppeldoesnotapplyinthiscase

Wefindnomeritinpetitionersclaimthatrespondentisnowestoppedfromclaimingprescription
sincebyexecutingthewaivers,itwastheonewhichaskedforadditionaltimetosubmittherequired
documents.
[20]
InCollector of Internal Revenue v. Suyoc Consolidated Mining Company, the doctrine of
estoppel prevented the taxpayer from raising the defense of prescription against the efforts of the
governmenttocollecttheassessedtax.However,itmustbestressedthatinthesaidcase,estoppelwas
appliedasanexceptiontothestatuteoflimitationsoncollectionoftaxesandnotontheassessmentof
taxes,astheBIRwasabletomakeanassessmentwithintheprescribedperiod.Moreimportant,there

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wasafindingthatthetaxpayermadeseveralrequestsorpositiveactstoconvincethegovernmentto
postponethecollectionoftaxes,viz:

Itappearsthatthefirstassessmentmadeagainstrespondentbasedonitssecondfinalreturnfiled
onNovember 28, 1946 was made on February 11, 1947. Upon receipt of this assessment respondent
requestedforatleastoneyearwithinwhichtopaytheamountassessedalthoughitreserveditsrightto
questionthecorrectnessoftheassessmentbeforeactualpayment.Petitionergrantedanextensionofonly
threemonths.Whenitfailedtopaythetaxwithintheperiodextended,petitionersentrespondentaletter
on November 28, 1950 demanding payment of the tax as assessed, and upon receipt of the letter
respondent asked for a reinvestigation and reconsideration of the assessment. When this request was
denied,respondentagainrequestedforareconsiderationonApril25,1952,whichwasdeniedonMay6,
1953,whichdenialwasappealedtotheConferenceStaff.TheappealwasheardbytheConferenceStaff
fromSeptember2,1953toJuly16,1955,andasaresultofthesevariousnegotiations,theassessmentwas
finally reduced on July 26, 1955. This is the ruling which is now being questioned after a protracted
negotiationonthegroundthatthecollectionofthetaxhasalreadyprescribed.

Itisobviousfromtheforegoingthatpetitionerrefrainedfromcollectingthetaxbydistraintorlevy
orbyproceedingincourtwithinthe5yearperiodfromthefilingofthesecondamendedfinalreturndueto
theseveralrequestsofrespondentforextensiontowhichpetitioneryieldedtogiveiteveryopportunityto
prove its claim regarding the correctness of the assessment. Because of such requests, several
reinvestigations were made and a hearing was even held by the Conference Staff organized in the
collectionofficetoconsiderclaimsofsuchnaturewhich,astherecordshows,lastedforseveralmonths.
Afterinducingpetitionertodelaycollectionasheinfactdid,itismostunfairforrespondenttonowtake
advantage of such desistance to elude his deficiency income tax liability to the prejudice of the
Governmentinvokingthetechnicalgroundofprescription.

While we may agree with the Court of Tax Appeals that a mere request for reexamination or
reinvestigationmaynothavetheeffectofsuspendingtherunningoftheperiodoflimitationforinsuch
casethereisneedofawrittenagreementtoextendtheperiodbetweentheCollectorandthetaxpayer,there
arecaseshoweverwhereataxpayermaybepreventedfromsettingupthedefenseofprescriptionevenif
he has not previously waived it in writing as when by his repeated requests or positive acts the
Government has been, for good reasons, persuaded to postpone collection to make him feel that the
demandwasnotunreasonableorthatnoharassmentorinjusticeismeantbytheGovernment.Andwhen
suchsituationcomestopassthereareauthoritiesthathold,basedonweightyreasons,thatsuchanattitude
orbehaviorshouldnotbecountenancedifonlytoprotecttheinterestoftheGovernment.

Thiscasehasnoprecedentinthisjurisdictionforitisthefirsttimethatsuchhasrisen,butthereare
severalprecedentsthatmaybeinvokedinAmericanjurisprudence.AsMr.JusticeCardozohassaid:The
applicableprincipleisfundamentalandunquestioned.Hewhopreventsathingfrombeingdonemaynot
availhimselfofthenonperformancewhichhehashimselfoccasioned,forthelawsaystohimineffectthis
isyourownact,andthereforeyouarenotdamnified.(R.H.StearnsCo.vs.U.S.,78L.ed.,647).Or,as
was aptly said, The tax could have been collected, but the government withheld action at the specific
requestoftheplaintiff.Theplaintiffisnowestoppedandshouldnotbepermittedtoraisethedefenseofthe
[21]
StatuteofLimitations.[NewportCo.vs.U.S.,(DCWIS),34F.Supp.588].


Conversely,inthiscase,theassessmentswereissuedbeyondtheprescribedperiod.Also,thereis
no showing that respondent made any request to persuade the BIR to postpone the issuance of the
assessments.

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Thedoctrineofestoppelcannotbeappliedinthiscaseasanexceptiontothestatuteoflimitations
ontheassessmentoftaxesconsideringthatthereisadetailedprocedurefortheproperexecutionofthe
waiver,whichtheBIRmuststrictlyfollow.Aswehaveoftensaid,thedoctrineofestoppelispredicated
[22]
on,andhasitsoriginin,equitywhich,broadlydefined,isjusticeaccordingtonaturallawandright.
Assuch,thedoctrineofestoppelcannotgivevaliditytoanactthatisprohibitedbylaworonethatis
[23]
againstpublicpolicy. Itshouldberesortedtosolelyasameansofpreventinginjusticeandshould
notbepermittedtodefeattheadministrationofthelaw,ortoaccomplishawrongorsecureanundue
[24]
advantage, or to extend beyond them requirements of the transactions in which they originate.
Simplyput,thedoctrineofestoppelmustbesparinglyapplied.

Moreover,theBIRcannothidebehindthedoctrineofestoppeltocoveritsfailuretocomplywith
RMO2090andRDAO0501,whichtheBIRitselfissued.Asstatedearlier,theBIRfailedtoverify
whetheranotarizedwrittenauthoritywasgivenbytherespondenttoitsaccountant,andtoindicatethe
dateofacceptanceandthereceiptbytherespondentofthewaivers.Havingcausedthedefectsinthe
waivers, the BIR must bear the consequence. It cannot shift the blame to the taxpayer. To stress, a
waiver of the statute of limitations, being a derogation of the taxpayers right to security against
[25]
prolongedandunscrupulousinvestigations,mustbecarefullyandstrictlyconstrued.

As to the alleged delay of the respondent to furnish the BIR of the required documents, this
cannot be taken against respondent. Neither can the BIR use this as an excuse for issuing the
assessmentsbeyondthethreeyearperiodbecausewithorwithouttherequireddocuments,theCIRhas
[26]
thepowertomakeassessmentsbasedonthebestevidenceobtainable.

WHEREFORE, the petition is DENIED. The assailed Decision dated March 30, 2007 and
ResolutiondatedMay18,2007oftheCourtofTaxAppealsareherebyAFFIRMED.

SOORDERED.



MARIANOC.DELCASTILLO
AssociateJustice
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WECONCUR:


ANTONIOT.CARPIO
AssociateJustice
Chairperson



ARTUROD.BRION ROBERTOA.ABAD
AssociateJustice AssociateJustice


JOSEPORTUGALPEREZ
AssociateJustice




ATTESTATION

IattestthattheconclusionsintheaboveDecisionhadbeenreachedinconsultationbeforethecasewas
assignedtothewriteroftheopinionoftheCourtsDivision.


ANTONIOT.CARPIO
AssociateJustice
Chairperson,SecondDivision




CERTIFICATION

PursuanttoSection13,ArticleVIIIoftheConstitution,andtheDivisionChairpersonsattestation,itis
herebycertifiedthattheconclusionsintheaboveDecisionhadbeenreachedinconsultationbeforethe
casewasassignedtothewriteroftheopinionoftheCourtsDivision.


REYNATOS.PUNO
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ChiefJustice

[1]
RepublicofthePhils.v.Ablaza,108Phil.1105,1108(1960).
[2]
Rollo,pp.3145pennedbyAssociateJusticeLovellR.BautistaandconcurredinbyAssociateJusticesJuanitoC.Castaeda,Jr.,ErlindaP.Uy,
CaesarA.CasanovaandOlgaPalancaEnriquez.PresidingJusticeErnestoD.Acostawasonleave.
[3]
Id.,at4650pennedbyAssociateJusticeLovellR.BautistaandconcurredinbyPresidingJusticeErnestoD.AcostaandAssociateJustices
JuanitoC.Castaeda,Jr.,ErlindaP.Uy,CaesarA.CasanovaandOlgaPalancaEnriquez.
[4]
Records,pp.227228.
[5]
Id.at229230.
[6]
Id.at1821.
[7]
Id.at117.
[8]
Id.at161165.
[9]
Id.at219226.
[10]
Id.at259266.
[11]
Id.at265.
[12]
Id.at294296.
[13]
Rollo,pp.4243.
[14]
Id.at17.
[15]
SEC.203.PeriodofLimitationUponAssessmentandCollection.ExceptasprovidedinSection222,internalrevenuetaxesshall
be assessed within three (3) years after the last day prescribed by law for the filing of the return, and no proceeding in court
without assessment for the collection of such taxes shall be begun after the expiration of such period: Provided, That in a case
whereareturnisfiledbeyondtheperiodprescribedbylaw,thethree(3)yearperiodshallbecountedfromthedaythereturnwas
filed.ForpurposesofthisSection,areturnfiledbeforethelastdayprescribedbylawforthefilingthereofshallbeconsideredas
filedonsuchlastday.
[16]
SEC.222.Exceptionsastoperiodoflimitationofassessmentandcollectionoftaxes.
(a) In the case of a false or fraudulent return with intent to evade tax or of failure to file a return, the tax may be assessed, or a
proceeding in court for the collection of such tax may be filed without assessment, at any time within ten (10) years after the
discoveryofthefalsity,fraud,oromission:Provided,Thatinafraudassessmentwhichhasbecomefinalandexecutory,thefactof
fraudshallbejudiciallytakencognizanceofinthecivilorcriminalactionforthecollectionthereof.
(b)IfbeforetheexpirationofthetimeprescribedinSection203fortheassessmentofthetax,boththeCommissionerandthetaxpayer
have agreed in writing to its assessment after such time, the tax may be assessed within the period agreed upon. The period so
agreeduponmaybeextendedbysubsequentwrittenagreementmadebeforetheexpirationoftheperiodpreviouslyagreedupon.
(c)Any internal revenue tax which has been assessed within the period of limitation as prescribed in paragraph (a) hereof may be
collectedbydistraintorlevyorbyaproceedingincourtwithinfive(5)yearsfollowingtheassessmentofthetax.
(d)Anyinternalrevenuetax,whichhasbeenassessedwithintheperiodagreeduponasprovidedinparagraph(b)hereinabove,maybe
collectedbydistraintorlevyorbyaproceedingincourtwithintheperiodagreeduponinwritingbeforetheexpirationofthefive
(5)yearperiod.Theperiodsoagreeduponmaybeextendedbysubsequentwrittenagreementsmadebeforetheexpirationofthe
periodpreviouslyagreedupon.
(e)Provided,however,ThatnothingintheimmediatelyprecedingSectionandparagraph(a)hereofshallbeconstruedtoauthorizethe
examination and investigation or inquiry into any tax return filed in accordance with the provisions of any tax amnesty law or
decree.
[17]
Intheexecutionofsaidwaiver,thefollowingproceduresshouldbefollowed:
1. The waiver must be in the form identified hereof. This form may be reproduced by the Office concerned but there should be no
deviationfromsuchform.Thephrasebutnotafter______19___shouldbefilledup.Thisindicatestheexpirydateoftheperiod
agreedupontoassess/collectthetaxaftertheregularthreeyearperiodofprescription.Theperiodagreeduponshallconstitutethe
timewithinwhichtoeffecttheassessment/collectionofthetaxinadditiontotheordinaryprescriptiveperiod.
2.Thewaivershallbesignedbythetaxpayerhimselforhisdulyauthorizedrepresentative.Inthecaseofacorporation,thewaiver
mustbesignedbyanyofitsresponsibleofficials.

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Soonafterthewaiverissignedbythetaxpayer,theCommissionerofInternalRevenueortherevenueofficialauthorizedbyhim,as
hereinafter provided, shall sign the waiver indicating that the Bureau has accepted and agreed to the waiver. The date of such
acceptancebytheBureaushouldbeindicated.BoththedateofexecutionbythetaxpayeranddateofacceptancebytheBureau
shouldbebeforetheexpirationoftheperiodofprescriptionorbeforethelapseoftheperiodagreeduponincaseasubsequent
agreementisexecuted.
3.Thefollowingrevenueofficialsareauthorizedtosignthewaiver.
A.IntheNationalOffice
1.ACIRsforCollection,SpecialOperationsFortaxcasesinvolving
NationalAssessment,ExciseandLegalontaxnotmorethanP500,000.00
casespendingbeforetheirrespectiveoffices.In
theabsenceoftheACIR,theHeadExecutive
Assistantmaysignthewaiver.
3.CommissionerFortaxcasesinvolvingmorethanP1M
xxxx
4.Thewaivermustbeexecutedinthree(3)copies,theoriginalcopytobeattachedtothedocketofthecase,thesecondcopyforthe
taxpayerandthethirdcopyfortheOfficeacceptingthewaiver.Thefactofreceiptbythetaxpayerofhis/herfilecopyshallbe
indicatedintheoriginalcopy.
5.Theforegoingproceduresshallbestrictlyfollowed.AnyrevenueofficialfoundnottohavecompliedwiththisOrderresultingin
prescriptionoftherighttoassess/collectshallbeadministrativelydealtwith.
[18]
I.RevenueOfficialsAuthorizedtoSigntheWaiver
ThefollowingrevenueofficialsareauthorizedtosignandaccepttheWaiveroftheDefenseofPrescriptionUndertheStatuteof
Limitations (Annex A) prescribed in Sections 203, 222 and other related provisions of the National Internal Revenue Code of
1997:
A.ForNationalOfficecases
DesignatedRevenueOfficial
1.AssistantCommissioner(ACIR),Fortaxfraudandpolicy
EnforcementServicecases
xxxx
In order to prevent undue delay in the execution and acceptance of the waiver, the assistant heads of the concerned offices are
likewiseauthorizedtosignthesameundermeritoriouscircumstancesintheabsenceoftheabovementionedofficials.
Theauthorizedrevenueofficialshallensurethatthewaiverisdulyaccomplishedandsignedbythetaxpayerorhisauthorized
representativebeforeaffixinghissignaturetosignifyacceptanceofthesame.Incasetheauthorityisdelegatedbythetaxpayertoa
representative,theconcernedrevenueofficialshallseetoitthatsuchdelegationisinwritinganddulynotarized.TheWAIVER
shouldnotbeacceptedbytheconcernedBIRofficeandofficialunlessdulynotarized.
II.RepealingClause
Allotherissuancesand/orportionsthereofinconsistentherewithareherebyrepealedandamendedaccordingly.
[19]
PhilippineJournalist,Inc.v.CommissionerofInternalRevenue,488Phil.218,235(2004).
[20]
104Phil819(1958).
[21]
Id.at822824.
[22]
LaNavalDrugCorporationv.CourtofAppeals,G.R.No.103200,August31,1994,236SCRA78,87.
[23]
Ouanov.CourtofAppeals,446Phil.690,708(2003).
[24]
C&SFishfarmCorporationv.CourtofAppeals,442Phil.279,290(2002).
[25]
PhilippineJournalist,Inc.v.CommissionerofInternalRevenue,supranote19at231232.
[26]
SEC. 6. Power of the Commissioner to MakeAssessments and Prescribe Additional Requirements for Tax Administration and
Enforcement
xxxx
(b)FailuretoSubmitRequiredReturns,Statements,ReportsandotherDocuments.Whenareportrequiredbylawasabasisforthe
assessmentofanynationalinternalrevenuetaxshallnotbeforthcomingwithinthetimefixedbylaworrulesandregulationor
whenthereisreasontobelievethatanysuchreportisfalse,incompleteorerroneous,theCommissionershallassessthepropertax
onthebestevidenceobtainable.
Incaseapersonfailstofilearequiredreturnorotherdocumentatthetimeprescribedbylaw,orwillfullyorotherwisefilesafalse
orfraudulentreturnorotherdocument,theCommissionershallmakeoramendthereturnfromhisownknowledgeandfromsuch
information as he can obtain through testimony or otherwise, which shall be prima facie correct and sufficient for all legal
purposes.

http://sc.judiciary.gov.ph/jurisprudence/2010/may2010/178087.htm 12/12