PEOPLE OF THE PHILIPPINES VS. ROVIC PISO EMPLEO ( Consolacion Manpower Consultant Services), Poblacion Occidental Consolacion, Cebu

CTA Form No. 8 (For DCC) 111111111111 111111111111111 1111111111 11111111111111111111 1111111111 1111111111111 14-000394-0007 REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY FIRST DIVISION CTA CRIM. CASE NO. 0-431 PEOPLE OF THE PIDLIPPINES, Plaintiff, -versus- NOTICE OF RESOLUTION ROVIC PISO EMPLEO, (Consolacion Manpower Consultant Services), Accused. To: PROSECUTOR GENERAL BENEDICTO A. MALCONTENTO STATE PROSECUTOR ROMEO MARTIN P. SERANILLA Department of Justice Padre Faura St., Ermita, Manila COMMISSIONER OF INTERNAL REVENUE Thru: Prosecution Division Room 704, BIR National Office Building Sen. Miriam P. Defensor-Santiago Avenue Diliman, Quezon City DIRECTOR N ational Bureau of Investigation Taft Avenue, Ermita Manila PNPCffiEF Thru: CIDG Philippine National Police National Headquarters Camp BGen Rafael Tagle Cram e ED SA,Quezon City CHIEF, WARRANT & SUBPOENA SECTION Consolacion Police Station M. Pepito Street, Consolacion 600 1 Cebu GREETINGS: You are hereby notified by these presents that on August 15, 2024, a Resolution was rendered in the above-entitled case, copy of which is attached hereto. Quezon City, Philippines, August 16, 2024. Jo~F. Atty. Maria Executive ~CourCthaIIn-Te

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY FIRST DIVISION PEOPLE OF THE PHILIPPINES, CTA Crim. Case No. 0-431 Plaintiff, For: Violation of Section 254 of the NIRC of 1997, as amended -versus- Members: DEL ROSARIO, P.J. , Chairperson, BACORRO-VILLENA, and CUI-DAVID, JJ. ROVIC PISO EMPLEO, (Consolacion Manpower Consultant Services), Accused. X---------------------------------- On 28 October 2014, the plaintiff filed an lnformation1 against herein accused ROVIC PISO EMPLEO (accused) of Consolacion Manpower Consultant Services (CMCS), for violation of Section 2542 of the National Internal Revenue Code (NIRC) of 1997, as amended. The accusatory portion of which reads: "That sometime in 2005 or until the filing of the quarterly Value Added Tax (VAT) Return and the corresponding payment of VAT for third quarter of taxable year 2005, in Cebu and within the jurisdiction of this Honorable Court, the above-named accused Rovic Piso Empleo, as a registered taxpayer and being the sole Division Docket, pp. 4-5. 2 S EC. 254. Aflempt to Evade or Defeat Tax. - Any pe rson who willfully a ttempts in a ny ma nne r to evade o r defeat a ny tax imposed und er this Cod e o r t he payment th ereof shall, in add ition to other penalties provided by law, upon conviction thereof, be punished by a fi ne not less than Thirty thousand (P30,000) but not more than One hundred thousand pesos (P I00,000) and suffer imprisonment of not less than two (2) years but not more than four (4) years: Provided, That the conviction or acquittal obtained under this Section shall not be a bar to the filing of a civil suit fo r the collection o f taxes. (Emphasis supplied)

RESOLUTION CTA Criminal Case No. 0-43 1 People of the Philippines v. Rovic Piso Empleo (Consolacion Manpower Consultant Services) Page 2 of6 x------------- -- -- - ------ -- -- - ----------------- - ------ - ------- - --- ---- -x proprietress of Consolacion Manpower Consultant Services wh ich is engaged in providing manpower services, did then and there willfully, unlawfully and fe loniously attempt to evade or defeat the payment of correct VAT by under declaring all the sales and exchange of services of her company for the th ird quarter of taxable year 2005, wh ich resulted to basic VAT deficiency in the amount of One Million Eighty Five Thousand Eight Hundred Seventeen and 96/100 centavos (Php1 ,085,817.96), more or less. exclusive of surcharges and interest, to the damage and prejudice of the government. " CONTRARY TO LAW.3 The plaintiff attached the following supporting documents to the Information for the Court's examination: 1. Certified Xerox Copy of the Resolution dated 11 July 2014, signed by State Prosecutor Romeo Martin P. Serranilla, with recommending approval of Edna A. Valenzuela, Senior Assistant State Prosecutor, and approved by Prosecutor General Claro A. Arellano;4 2. Certified Xerox Copies of National Prosecution Service (NPS) Hearing Forms/Minutes dated 10 October 20135 and 26 September 20136; 3. Certified Xerox Copy of the Subpoenas dated 30 September 20137 and 03 September 20138 issued to the accused; 4. Certified Xerox Copy of the Referral Letter dated 08 August 2 01 3 of then Bureau of Internal Revenue (BIR) Commissioner Kim S. Jacinto-Henares, addressed to then Secretary of Justice Leila de Lima;9 and, 5. Certified Xerox Copy of the Joint Complaint-Affidavit dated 08 August 201310 of Revenue Officers (ROs) Rogelio S. Emphasis in the original text and underscoring supplied. Division Docket, pp. 6- 12. !d., p. 13. 6 !d., p. 15. Jd., p. 14. ld., p. 16. 9 ld., pp. 18- 19. 10 !d., pp. 20-26.

RESOLUTION CTA Criminal Case No. 0-431 People of the Philippines v. Rovic Piso Empleo (Consolacion Manpower Consultant Services) Page 3 of6 x-- --- ------------- -- ------- ----- ----------- --- -------- - ----- ----------x Lusares (Lusares) and Pilar G. Namoc (Namoc), with attached Annexes "A" to "L", inclusive of sub-markings.11 In a Resolution dated 11 November 201412 , the Second Division found probable cause and ordered the issuance of a Warrant of Arrest against the accused. It also fixed the bail bond for his provisional liberty in the amount of P100,000.00. As the accused had not been apprehended after the lapse of approximately three (3) months, the Second Division issued an Alias Warrant of Arrest13 on 04 February 2015. Even after a considerable period, accused remained at large. Hence, the instant case was archived, subject to revival upon the arrest of accused.14 In the meantime, following the reorganization of the different divisions of the Court, the case was transferred to the First Division.15 In an effort to speedily dispose the cases and to de-clog court dockets, an inventory of archived cases was made thereafter. After a second hard look upon the allegations in the lnformation16, and personal evaluation of the supporting documents17 submitted, We find that this Court lacks capacity to exercise jurisdiction over the instant case. Under Republic Act (RA) No. 112518, as amended by RA No. 928219, the Court has exclusive original jurisdiction over all criminal cases arising from violations of the NIRC of 1997, as amended, where the principal amount of taxes and fees claimed , exclusive of charges and penalties, is P1 ,000,000.00 or more.20 II ld., pp. 27-68. 12 ld., pp. 70-71. 13 Id., p. 78. 14 ld., p. 80. 15 ld., p. 85. 16 Supra at note I . 17 Supra at notes 4-1 I. 18 AN ACT CREATING THE COURT OF TAX APPEALS. 19 AN ACT EXPANDING THE JURlSDICTION OF THE COURT OF TAX APPEALS (CTA), ELEVATING ITS RANK TO THE LEVEL OF A COLLEGIATE COURT WITH SPECIAL JURISDICTION AND ENLARG ING ITS MEMBERSHIP, AMENDING FOR THE PURPOSE CERTAIN SECTIONS OF REPUBLIC ACT NO. 11 25, AS AMENDED, OTHERWISE KNOWN AS THE LAW CREATING THE COURT OF TAX APPEALS, AND FOR OTHER PURPOSES. 20 SEC. 7. Jurisdiction . - The CTA shall exercise: (b) Jurisdiction over cases involving criminal offenses as herein provided:

RESOLUTION CTA Criminal Case No. 0-431 People of the Philippines v. Rovic Piso Emple o (Consolacion Manpower Consultant Services) Page 4 of6 x----------- - ---- -- - -- -- - ----------- - ---- - --- - ---------------- - --------x Moreover, Rule 4, Section 3(b)(1 )21 of the Revised Rules of the Court of Tax Appeals22 (RRCTA) states that such cases are within the exclusive jurisdiction of the Court of Tax Appeals in Division. From the foregoing provisions, it is evident that the exact principal amount of taxes and fees being claimed , exclusive of charges and penalties, is crucial in establishing whether the Court has jurisdiction over a case. In the case at bar, the lnformation23 indicates a basic value- added tax [VAT] deficiency "in the amount of One Million Eighty Five Thousand Eight Hundred Seventeen and 96/100 centavos (Php1 ,085,817.96), more or less, exclusive of surcharges and interest[.)" With the phrase "more or less", the exact principal amount of taxes being claimed cannot be precisely ascertained; hence, the Court's capacity to exercise jurisdiction over the present case cannot be definitively established. Assuming ex gratia in argumenti that the modifier "more or less" was not intended to introduce an element of uncertainty to the deficiency amount, an assiduous review of the allegations in the Joint Complaint-Affidavit, and the supporting documentation attached (I) Exclusive original jurisdiction over all criminal offenses arising from violations of the National Internal Revenue Code or Tariff and Custom s Code and other laws adm inistered by the Bureau of Internal Revenue or th e Bureau of Customs: Provided, however , T ha t offe nses or felo nies ment ioned in this p aragra ph where th e pr incipal a moun t of taxes and fees, exclusive of cha r ges a nd pe na lties, claimed is less tha n O ne million pesos (Pl ,OOO,OOO.OO) o r where there is no specified a mou nt cla im ed sha ll be t ried by the regular Cou rts a nd t he jurisdictio n of t he CTA shall be appellate. Any provision of law or the Rules of Court to the contrary notwithstanding, the criminal action and the corresponding civil action for the recovery of civil liabi lity for taxes and penalt ies shall at all times be sim ul taneously instituted with, and jointly determ ined in the same proceeding by the CTA, the filing of the criminal action being deemed to necessarily carry with it the filing of the civi l action, and no r ight to reserve the filin g of such civi l action separately from the criminal action will be recognized. (Emphasis supplied.) 21 SEC. 3. Cases Within the Jurisdiction of th e Court in Divisions. - The Court in Divisions shall exercise: (b) Exclusive jurisdiction over cases involving criminal offenses, to wit: (I) Original j urisdiction over all criminal offenses ari sing from violations of the National Intern al Revenue Code or Tariff and Customs Code and other laws adm inistered by the Bureau of Internal Revenue or the Bureau of Customs, where th e p rin cipal amo un t of taxes a nd fees, exclusive of c ha rges and penalties, claim ed is one million pesos or m ore[.] (Emphasis supplied .) 22 A.M. No . 05- 11 -07-CTA . 23 Supra at note I.

RESOLUTION CTA Criminal Case No. 0 -43 1 People of the Philippines v. Rovic Piso Empleo (Consolacion Manpower Consultant Services) Page 5 of6 x--- -------------- ------- ----- --------------------- --------- -------- --- x thereto, reinforces the notion that the subject matter herein is outside the Court's jurisdiction. Per the "Computation of Tax Deficiencies & Penalties" portion24 in the said Joint Complaint-Affidavit, the accused's deficiency VAT was computed as follows: 2.) VALUE-ADDED TAX (SECTION 108 OF THE NIRC, AS AMENDED) Computations per Quarter 3 rd Quarter Gross Revenue per Data/Evidences Furnished by the Taxpayer's Customer/Client P3,579,937.81 Multiply by: VAT Rate 10% Total VAT Payable per Investigation Less: VAT Payment per returns filed 357 ,993 .78 Basic VAT Deficiency {5,391 .88) Add: 50% Surcharge 352,601 .90 176,300.95 20% Interest per annum (26 October 2005 to 08 August 2013) 556,915.11 P1 ,085,817.96 Total VAT Deficiency As can be gleaned from the above calculation, the amount of P1 ,085,817.96 represents the accused's total VAT deficiency for the 3rd quarter of the subject calendar year (CY) 2005. Notably, the said amount includes a 50% surcharge and 20% deficiency interest, both imposed on the basic VAT deficiency amounting to P352,601 .90. This runs contrary to the allegations in the lnformation25, which specifies that amount of P1 ,085,817.96 pertains to the basic VAT deficiency, exclusive of surcharges and interest. Consequently, since the Information erroneously stated the components of the deficiency tax demandable from the accused , it can thus be said that the same evidently failed to accurately state the omission complained of as constituting the offense of attempting to evade or defeat tax under Section 25426 of the NIRC of 1997, as amended . As a result, the accused was not properly informed of the exact nature and cause of the accusation, undermining their ability to mount a proper defense. Such a fatal defect in the Information can operate to deprive the Court of jurisdiction to proceed with the case. 24 Paragraph 18, Joint Complaint-Affidavit, supra at note I0, pp. 24-25. zs Supra at note I. 26 Supra at note 2.

RESOLUTION CTA Criminal Case No. 0-431 People of the Philippines v. Rovic Piso Empleo (Consolacion Manpower Consultant Services) Page 6 of6 x----------------------------------------------- -- ----------- -------- --x More importantly, however, as the actual basic VAT deficiency only amounts to F>352,601 .90 (instead of the F>1,085,817.96 originally alleged in the Information), the instant case falls outside the jurisdiction of this Court as the principal amount of taxes claimed is below the F>1 ,000,000.00 jurisdictional amount. 27 It bears emphasis that jurisdiction is conferred by law and is the capacity of a court to entertain, hear, and determine certain controversies. 28 The Court of Tax Appeals, as a court of special jurisdiction , can only take cognizance of matters clearly within its jurisdiction .29 As� the records would show, the instant case fails to meet the pertinent criteria. WHEREFORE, in consideration of the foregoing , CTA Criminal Case No. 0-431 is hereby DISMISSED for lack of jurisdiction . SO ORDERED. ROMAN G. DEL ROSARIO Associate Justice ON OFFICIALSUSfNESS LANEE S. CUI-DAVID Associate Justice 27 Supra at notes 20 and 2 1. 28 See Gilbert G. Guy v. The Court ofAppeals, eta/. , G.R. Nos. 165849, 1701 85, 170 186, 17 1066 and 176650, I0 December 2007. 29 Commissioner of Internal Revenue v. Silicon Philippines, Inc. (formerly Intel Philippines Manufacturing, Inc.), G.R. No. 169778, 12 March 20 14.