PRO STAR SPORTS PHILIPPINES, INC. v. COMMISSIONER OF INTERNAL REVENUE

CTA Form No. 8 (For DCC) 1111111111111111111111 11111 11111 1111111111111111111 111111 111111111111111 11111111 22-000568-0053 REPUBLIC OF THE PIDLIPPINES COURT OF TAX APPEALS QUEZON CITY SPECIAL FIRST DIVISION CTA CASE NO. 11037 PRO STAR SPORTS PHILIPPINES, INC., Petitioner, -versus- NOTICE OF RESOLUTION COMMISSIONER OF INTERNAL REVENUE, Respondent. To: OFFICE OF THE SOLICITOR GENERAL 134 Amorsolo Street, Legazpi Village Makati City ATTY.JUFFALIA.ABDULLAH Bureau of Internal Revenue Legal Division, Revenue Region No.7B - East NCR 25th Floor, The Podium-West Tower ADB Avenue, Ortigas Center Mandaluyong City GALlAS & RIVERA LAW OFFICES 3/F Prestige Tower, F. Ortigas Jr. Road Ortigas Center, Pasig City 1605 GREETINGS: You are hereby notified by these presents that on February 24, 2026, a Resolution was rendered in the above-entitled case, copy of which is attached hereto. Quezon City, Philippines, February 25, 2026. t Mar~oanna Atty. F. Chan-Te Executive Clerk of Court III

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY SPECIAL FIRST DIVISION PRO STAR SPORTS CTA CASE NO. 11037 PHILIPPINES, INC. , Petitioner, Members: -versus- BACORRO-VILLENA, Acting Chairperson, and CUI-DAVID, JJ. COMMISSIONER OF Promulgated: INTERNAL REVENUE, Respondent. FE~ 2 4 l.UZti ~ ~ "c :t:�?-- ~ ltr .. ){- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -){ RESOLUTION CUI-DAVID, J.: This resolves respondent's Motion for Reconsideration (of Decision dated June 20, 2025) [Motion], 1 filed July 15, 2025, without p etitioner 's comment/opposition, as reflected in the Records Verification Report dated January 16, 2026. Respondent seeks reconsideration of the Court's Decision2 promulgated on June 20 , 2025 (assailed Decision), the dispositive portion of which reads: WHEREFORE, premises considered, the instant Petition for Review is h ereby GRANTED. Accordingly, the Formal Letters of Dem a nd (Pa rt I a nd Pa rt II) and Assessment Notices, a ll d a ted October 13, 2016, assessing petitioner Pro Star Sports Philippines, Inc . of deficiency Income Tax a nd Compromis e Penalty in the a ggregate amount of P9 ,105,248.69, inclus ive of interest, a re CANCELLED a nd SET ASIDE. Furthermore , responden t Commissioner of Interna l Revenue or a ny person acting on his beh a lf is ENJOINED a nd Docket. pp. 449-455. /d. at 432-448.

RESOLUTION CTA Case No. 11037 Pro Star Sports Philippines, Inc. v. Commissioner of Intern a l Revenue X------ - ------------------------ --------------------- --------------------- --- -------- X PROHIBITED from collecting the a mount of P9, 105,248.69 from petitioner. SO ORDERED. Respondent anchors his Motion on the sole ground that: RESPECTFULLY, THE HONORABLE COURT ERRED IN CANCELLING AND SETTING ASIDE THE FORMAL LETTER OF DEMAND AND ASSESSMENT NOTICES ISSUED BY THE RESPONDENT . According to respondent, the Court relied on the pronouncements in Medicard Philippines, Inc. v. Commissioner of Internal Revenue 3 (Medicard), where the Supreme Court elucidated the importance of the authority of the Revenue Officer (RO) in the performance of assessment functions. Respondent, however, argues that Medicard does not apply to the instant case, claiming that the facts and issue therein materially differ from those at bar. Respondent also submits that the pronouncement in Commissioner of Internal Revenue v. McDonald's Philippines Realty Corp., 4 is inapplicable. He maintains that the non- issuance of a new Letter of Authority (LOA) does not usurp the statutory power of the Commissioner of Internal Revenue (CIR), or his duly authorized representative, to examine the books of accounts of a taxpayer. According to respondent, what is important is that the audit of the taxpayer was previously authorized by an LOA and that only such taxpayer may be subject to examination by the ROs. Respondent further asserts that reliance on Revenue Memorandum Order (RMO) No . 43-905 concerning the issuance of a new LOA in cases of reassignment or transfer of cases to another RO, is untenable. Citing RMO No. 8-2006, respondent argues that only one LOA per taxable year may be issued to a taxpayer. Hence, he claims that the issuance of a Memorandum of Assignment to other ROs suffices to continue the audit under the previously issued LOA. G.R. No. 222743. April 5. 2017 [Per J. Reyes. Third Di visionJ. G.R. No. 242670. May I0, 2021 [Per J.Lo pez. J.. Th ird Di vision]. SUBJ ECT : Amendment of Revenue Memorandum Order No. 37-90 Prescribing Revised Policy Guidelines for Examination ofReturns and Issuance ofLeiters ofAuthority to Audit.

RESOLUTION CTA Case No. 11037 Pro Star Sports Philippines, Inc. v. Commissioner of Internal Revenue X----------- --------- ------ --------------------------------------- --- ------------- ---X Despite being afforded the opportunity to do so, petitioner failed to file its comment or objection to respondent's Motion. Accordingly, the Court now resolves the Motion. Respondent's Motion must fail. First, respondent's Motion for Reconsideration was filed beyond the 15-day reglementary period. In the landmark case of National Power Corporation v. National Labor Relations Commission6 (NAPOCOR), later echoed in Commissioner of Customs v. Court of Tax Appeals, 7 the Supreme Court aptly declared that service of legal processes upon the principal counsel, and not upon deputized lawyers, is decisive, thus: First. Petition er was represented in the CTA by the Office of the Solicitor General which depu tized lawyers in th e Legal Service Division of the Bureau of Customs to serve as collaborating counsels. In accordance with this a rrangement, lawyers in both offices (Bureau of Customs and the OSG) were served copies of decisions of the CTA. The lawyers at the Bureau received a copy of the decision of th e CTA on May 30, 1997, while the OSG received its own on June 5, 1997. As earlier stated, the OSG filed its motion for reconsideration on June 20, 1997. Counted from this date, the motion was season ably filed, but if the period for appealing or filing a motion for reconsideration were reckoned from the date of receipt of the decision by the lawyers of the Bureau of Customs, then the m otion was filed five days late. The Court of Appeals ruled that service of the copy of the CTA decision on the lawyers of the Bureau of Customs was equivalent to service on the OSG, and, th erefore, the motion for reconsideration was filed late. This is error. In National Power Corp. v. NLRC, it was already settled that although the OSG may have d eputized the lawyers in a government agency represented by it, the OSG continues to be the principal counsel, and, therefore, service on it of legal processes, and not that on the deputized lawyers, is decisive... (Emphasis and italics supplied) Clearly, when a party is represented by multiple counsel, such as when the principal counsel (e.g. , the Office of the Solicitor General) deputizes lawyers from the government 6 G.R. No. 90933-6 1, May 29, 1997. 7 G.R. No. 132929, March 27, 2022.

RESOLUTION CTA Case No . 11037 Pro Star Sports Philippines, Inc. v. Commission er of Interna l Revenue x------------------------------------------------------------------------------------x agency it represents, the receipt by the principal counsel is binding and governs the computation of the 15-day reglementary period. In th is case, the records reveal th at r es pondent's principal cou nsel - the Office of the Solicitor General - received the assailed Decision on June 26, 2025. Counting 15 days from J u ne 26, 2025, respondent had until July 11 , 2025 to file a m otion for reconsideration. However, respondent filed the instant Motion for Reconsideration (of Decision dated June 20, 2025) only on July 15, 2025, beyond th e 15-day reglementary period. Accordingly, the Motion was filed out of time. Second, even assuming that the instant Motion was timely filed, it would still be denied for lack of merit. A careful peru sal of th e allegations in th e subject Motion for Reconsideration shows that respondent raises no new or su bstantial arguments that would warrant a departure from the p reviou s conclu sion and finding of the Court. The issu es and arguments raised by respondent have already been passed u pon, amply discussed, and considered in the assailed Decision. On th is point, the Supreme Court's pron ouncement in Social Justice Society (SJS) Officers, et al. us. Lim,8 is instructive: "The filing of a motion for recons ideration, authorized by Rule 52 of the Ru les of Court , does n ot impose on the Cou rt th e obligation to deal individua lly a nd s pecifica lly with the grounds relied upon th erefor, in much the same way that the Court d oes in its judgm en t or fina l order as regards t h e issu es ra is ed and submitted for d ecis ion . This would be a useless forma lity or ritu a l invariably in volving m erely a reiteration of t he reason s a lready set fort h in th e judgment or final ord er for rejecting the a rgumen ts a dvan ced by th e movant; a nd it would be a n eedless act, too, with respect to issues raised for the first time, these being, a s a bove stated , deemed waived because not a sserted at th e fir st opportu nity. It suffices for the Court to deal generally and summarily with the motion for reconsideration, and merely state a legal ground for its denial (Sec. 14, Art. VIII, Constitution); i.e., the motion contains merely a reiteration or rehash of arguments already submitted to and pronounced without 8 G. R. No. 187836, March 10, 20 15.

RESOLUTION CTA Case No. 11037 Pro Sta r Sports Philippines, Inc. v. Commissioner of Internal Reven ue x----- ----- ------------------------ ---------------------- ----------------- -- ------ ---x merit by the Court in its judgment, or the basic issues have already been passed upon, or the motion discloses no substantial argument or cogent reason to warrant reconsideration or modification of the judgment or final order; or the arguments in the motion are too unsubstantial to require consideration, etc ." (Boldfacing supplied) Considering that the grounds relied upon merely reiterate issues already passed and resolved by the Court, there exists neither reason nor justification to set aside or modify the assailed Decision dated June 20, 2025. ACCORDINGLY, respondent's Motion for Reconsideration (of Decision dated June 20, 2025) is hereby DISMISSED, for having been filed out of time. SO ORDERED. LAN~h~D Associate Justice !CONCUR: