PEOPLE OF THE PHILIPPINES v. DENNIS SUMAYANG y ADORIO

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY THIRD DIVISION PEOPLE OF THE PHILIPPINES, CTA Crim. Case No. 0-764 Plaintiff, (NPS Docket No. XVI-INV-171-00236) For : Violation of Section 255 of the NIRC of 1997, as amended. -versus- Members: MANAHAN, Chairperson, REYES-FAJARDO, and DENNIS SUMAYANG y ADORIO, ANGELES, JJ. No. 964 Lower NAPOCOR, Phase 4-8 Cogeo Dela Paz, Anlipolo City, Rizal Promulgated: (All At-Large), A ccused. MAY 1 5 2024 X- - - - - - - - - - - - - - - - - - - - - - - - -~- "2: ;_q _f! .-~� - - - X RESOLUTION On July 22, 2019, an Information was filed with this Court, which reads as follows: The undersigned Assistant State Prosecutor of the Department of Justice , hereby accuses DENNIS SUMAYANG y ADORIO, of t h e offense of Failure to Pay the Tax in violation of Section 255 of the National Internal Revenue Code (NIRC) of 1997, as amended, committed as follows: "Thal on or about August 2017 in Antipolo City, the said accused, being the sole proprietor of D.A. Sumayang Construction, a business entity engaged in construction and registered at BIR Revenue District Office No. 45-Marikina City with Tax Identification Number 239-731-02 1 and wh ose tax liability as of th e said period is within the jurisdictional amoun t of this Honorable Court, did then and there willfully, unlawfully and felo niously fa il to pay his INCOME TAX deficiency liability in the amount of FOUR MILLION ONE HUNDRED NINETY EIGHT THOUSAND ONE HUNDRED FIVE PESOS and 63/100 (Php4, 198, 105.63), exclusive of addi- tionnal surcharge and inte rest, for taxable year 2010 despite receipt of several notices and d emands from lhe Bureau of Internal Revenues

RESOLUTION CTA Crim. Case No. 0 -764 [sic], th e la lcst being in the nature of Demand Before Suil dated August 9, 20 17, to the da mage and prejudice of the Philippine Government. CONTRARY TO LAW. Manila Cily lo Quezo n City, November 7, 20 17." In a Resolution dated August 7, 2019,1 the Court found the existence of probable cause to hold the accused for trial and ordered the issuance of a Warrant of Arrest. The Warrant of Arrest issued on August 13, 2019.2 The Court subsequently noted the Return ofWarrant dated September 16, 2019 ,3 stating that the whereabouts of accused is unknown/ cannot b e located.4 On July 22, 2020, the Court issued a Resolution archiving the case, the dispositive portion of which reads: WHEREFORE, co nsidering that more than six (6) m onths have lapsed from the time the Warrant of Arrest was issued against accused Dennis Sumayan g y Adorio, and that he is still at-large, and in order th al lhis case shall not rem a in pending for a n inde finite period of time, t his case is hereby ARCHIVED pursuant to Administrative Circular No. 7-A-92, dated June 2 1, 1993, to be revived upon his ap prehension. The Direclor - Na l io nal Bureau of Investigation; the Chief of lhe Philippine National Police; a nd the Chief of lhe Warranl a nd Subpoena Section of Antipolo Cily Poli ce Dislrict are h e reby directed to e nforce lhc o utslanding Warrant of Arrest issued on Augusl 13, 20 19 against accused Dennis Sumayan g y Adorio, a nd to report to the Court the resull or status t h e reof within thirty (30) days from reccipl he reof. Further, lhc Commissioner of Interna l Revenu e is directed lo exert diligent effort to ascertain the whereabou ls of accused and to report the same to th e Court within thirty (30) days from receipt h ereof for ap propriale action. SO ORDERED. 1 Docket, p. 64. 2 Docket, p. 70. 3 Docket, p. 76. 4 Resolution dated October 14,20 19, Docket, p . 79.

RESOLUTION CTA Crim. Case No. 0-764 The Records Verification dated November 27, 20205 shows that there is no report or n ew information on the whereabouts of accused. Thereafter, on February 22, 2022, the Court noted the Return of Wa rrant dated October 23 , 2021,6 stating that the whereabouts of accused remains unknown/ cannot be located.7 Meanwhile, th e number of criminal cases archived due to the authorities ' failure to cause the arrest of the accused, as well as the successive dismissal of recent cases on the ground of prescription, prompted this Court to review the archived cases to determine wheth er they were filed within the prescriptive period provided under Section 281 of the 1997 National Internal Revenue Code (NIRC) , as amended. Section 281 of th e 1997 NIRC, as amended, provides: SEC. 281. Prescription for Violations of any Provision of this Code. - All violation s of any provision of thi s Code s hall prescribe a fter five (5) years. Prescriplion shall begin to run from the day of the commission of the violation of the law, and if the same be not known at th e time, from the discovery thereof a nd the institution of judicial proceedings for its investigation and punishment. The prcscriplion sha ll be interrupted wh en proceedings arc insliluted against the guilty persons e1 nd she1ll begi n to run again if the proceedin gs arc d is missed for reasons not consliluling jeopardy. The term of presc ription s hall n ot run wh en the offen der is a bse nt from the Philippines.a Upon revisiting the instant case, the Court finds that the ) same has prescribed . The Information alleges that accused Sumayang willfully failed to pay deficie n cy incom e taxes "on or about August 2017 ." However, a closer scrutiny of the accompanying documents s Docket, p. 104. 6 Docket, p. 110. 7 Resolution dated February 22, 2022, Docket, p . 114. s Emphasis supplied.

RESOLUTION CTA Crim. Ca s e No. 0 -764 reveals that the Forma l Letter ofDemand9 was p ersonally served at his registered a d d res s on January 10, 2014.10 Jurispruden ce dictates that the offense of failure to pay deficiency tax is committed after service of notice and demand for payment upon the taxpayer, coupled with the latter's refusal to pay the tax due within the allotted period.11 In Petronila C. Tupaz v. Honorable B enedicta B. Ulep, Presiding Judge of RTC Quezon City, Branch 105, and People of the Philippines,12 the Supreme Court explained: "[I]t cannot be sa id that th e offense h as been committed ... upon filing of the inco me tax return. Th is is so because prior to the fi nality of th e assessm en t, the taxpayer h a s not commi tted any violation fo r non paymen t of th e tax. The offense w as committed only after the finality of the assessment coupled with taxpayer's willful refu s al to p ay the taxes within the allotted period. In th is case, when th e n otice of assessment was issued on July 16, 1984, the taxpaye r s till had thirty (30) days from receipt thereof to protest or question the asses sment. Otherwise, the assessment w ould become final and unappealable. As he did not protest, th e assessmen t became final and una ppealable on August 16, 1984."13 Applying the fo regoing in the present case , the deficiency income tax assessment again st accused became final, execu- tory, and unappeala ble on February 10, 2014-thirty (30) days from January 10, 2 0 14-con s idering that no protest was filed against it. It was then that the cause of action of the Bureau of Internal Revenue (BIR) a ccrued. Notably, the Formal Letter of Demand itself ind icates th at the due . date for payment is on February 10, 2014 . Consequently, a s the offense of failure to pay tax under Section 255 of the 1997 NIRC , as amended, was committed on February 10, 20 14, plaintiff h a d five (5) years from said date or until February 10, 2019 within which to file the Information in Court. Rule 9 , Section 2 of th e Revised Rules of the Court of Tax Appeals, as amen ded, l4 provides: 9 Annex "H-2," Joint Complaint-Affidavit, Docket , p. 49. 10 Joint Complaint-Affidavit, Docket, p. 31 . 11 Emilio E. Lim, Sr. and 1\nlonia Sun Um v. Court ofAppe als and People ofthe Philipp ines, G.R. Nos. 481 34-3 7, October 18, 1990. 12 G.R. No. 127777, October 1, 1999. 13 Emphasis s upplied. 14 A. M. No. 0 5- 1 1-07-CTA.

RESOLUTION CTA Crim. Case No. 0-764 SEC. 2. Institution of criminal actions. - All criminal actions before the Court in Division in the exercise of its original jurisdiction shall be instituted by the filing of an information in the name of the People of the Philippines. In criminal actions in volving violations of the National Internal Revenue Code a nd oth er laws enforced by the Bureau of Internal Revenue , the Commissioner of Internal Revenue must approve their filing ... The institution ofthe criminal action shall interrupt the running of the period ofprescription. IS The Information in this case, however, was filed only on July 22, 2019-more than five (5) months after February 10, 2019. Hence, it could no longer serve to interrupt the running of the prescriptive period since the present criminal action is already time-barred. ACCORDINGLY, CTA Criminal Case No. 0-764 is hereby WITHDRAWN from the archives and DISMISSED by reason of prescription of the offense charged. Let the Warrant of Arrest issued against accused be RECALLED and SET ASIDE. SO ORDERED. CATHERINE T. MANAHAN Associate Justice ~ L f ~. ,f'j'a-..4 I. MARIAN IVY REYESlFAJARDO Associate Justice HENRY ~~GELES Associate Justice ts Emphasis supplied.