ASIATRUST DEVELOPMENT BANK v. COMMISSIONER OF INTERNAL REVENUE

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY SPECIAL FIRST DIVISION ******************* ASIATRUST DEVELOPMENT BANK, C.T.A. CASE NO. 6209 Petitioner, Members: -versus- ACOST A, Chairperson BAUTISTA, and CASANOVA, JJ. COMMISSIONER OF INTERNAL Promulgated: REVENUE, Respondent. MAR 1 6 2010 ; ::;: 2 ~c.~ x- ------------------------------------- ~ AMENDED DECISION CASANOVA, J.: For resolution is petitioner's Motion for Reconsideration filed on February 11, 2009, seeking the reconsideration of this Court's Decision promulgated on January 20, 2009, the dispositive portion of which states: "WHEREFORE, premises considered, the instant Petition for Review is hereby PARTIALLY GRANTED . Accordingly, Assessment Notices issued against petitioner for deficiency documentary stamp, final withho lding, expanded withholding, and fringe benefits tax assessments the fiscal year ended June 30, 1996 are VOID for being issues beyond the prescriptive period allowed by law. The Assessment Notices issued by respondent against petitioner for deficiency income, documentary stamp - regular, documentary stamp - trust, and fringe benefits ta x assessments for the fiscal years ended June 30, 1997 & 1998 are hereby ordered CANCELLED and WITHDRAWN. Moreover, petitioner's deficiency documentary stamp ta x - IBC~ 46 1

AMENDED DECISION C.T.A. Case No. 6209 assessment for the fiscal year ended June 30, 1997 is ordered CANCELLED and WITHDRAWN. However, petitioner's deficiency documentary stamp tax - Special Savings Account assessments for the fiscal years ended June 30, 1997 & 1998, and deficiency documentary stamp ta x - IBCL and deficiency final withholding ta x - trust assessments for the fiscal year ended June 30, 1998, in the aggregate amount of P142, 777,785.91 are hereby AFFIRMED . The said amount is broken down as follows : Fiscal Year 1997 Documentary Stamp Tax - Industry Issue p 39,163,539.57 Fiscal Year 1998 Final Withholding Tax- Trust 10,183,367.80 Documentary Stamp Tax - Industry Issue 93,430,878.54 Total Deficiency Tax E..l42,llZ~ll SO ORDERED. " Petitioner moves for the reconsideration of the assailed Decision based on the following grounds: "1. THIS HONORABLE COURT DID NOT GIVE CREDENCE TO THE PETITIONER'S STATEMENT THAT IT FILED APPLICATIONS FOR THE ABATEMENT AND PAYMENT OF THE BASIC FINAL WITHHOLDING TAX ON TRUST DEPARTMENT PLACEMENTS II THIS HONORABLE COURT DID NOT GIVE CREDENCE TO THE PETITIONER'S STATEMENT THAT IT HAD AVAILED OF THE TAX AMNESTY LAW UNDER REPUBLIC ACT NO. 9480 III CONSIDERING THAT PETITIONER CAN SUBMIT PROOF THAT IT HAD AVAILED OF THE TAX AMNESTY LAW, IT IS THEREFORE IMM UNIZED FROM THE ALLEGED DOCUMENTARY TAX ASSESSMENTS RAISED BY THE BIR" Petitioner likewise attached documents as annexes to its Motion for Reconsideration, particularly, photocopies of its Tax Amnesty Return, Ta x Amnesty Payment Form, Bureau of Internal Revenue (BIR) Official Receipt, Notice of Avai lment of Tax Amnesty, and Statement of Assets and Liabilities and Networth~

AMENDED DECISION C.T.A. Case No. 6209 (SALN) as of June 30, 2005, 1 in support of the second and third assigned errors. In a Resolution promulgated on July 6, 2009, this Court found the first assigned error unmeritorious, but allowed petitioner to present and to formally offer to the Court the said documents attached to its Motion for evaluation and consideration. Consequently, the resolution of the second and third assigned errors was held in abeyance. A hearing was then set for the presentation and for the marking of petitioner's additional documentary evidence. Petitioner presented Exhibits "F" to "1", which are certified true copies of the original documents. 2 Petitioner filed its Formal Offer of Evidence on September 22, 2009, submitting Exhibits "F" (Ta x Amnesty Return), "G" (Ta x Amnesty Payment Form), "H" (DBP BTR-BIR Ta x Payment Deposit Slip), and "I" (Notice of Availment of Tax Amnesty). Respondent filed his Comment (On Petitioners Formal Offer of Evidence) on October 20, 2009, manifesting his lack of objection to the admission of petitioner's additional evidence. This Court admitted Exhibits "F" to "I" and ordered petitioner's Motion for Reconsideration submitted for resolution in Resolution dated November 10, 2009. In a Resolution dated December 3, 2009, this Court again held in abeyance the resolution of petitioner's Motion for Reconsideration to enable petitioner to mark, identify, and formally offer its Statement of Assets, Liabilities and Networth (SALN) as of June 30, 2005. Petitioner filed its Supplemental Formal Offer of Evidence on February 2, 2010, offering as additional evidence Exhibits "I-1" (Statement of Assets, Liabilities~ 1 Annexes " F" "G" " H" and " ! " Motion for Reconstderatton 2 Docket, p. 8J 6 ' ' ' 46 3

AMENDED DECISION C.T.A. Case No. 6209 and Networth as of June 30, 2005) and "J" (Certification issued by the Bureau of Internal Revenue dated August 20, 2009). Respondent manifested, in his Comment (On Petitioner's Supplemental Formal Offer of Evidence) filed on February 4, 2010, that he has no objection to the admission of Exhibits "I-1" and "]". The Court admitted Exhibits "I-1" and "J" and ordered petitioner's Motion for Reconstderation submitted for resolution via Resolution dated February 25, 2010. Hence, this Amended Decision. Since the first assigned error was already found by this Court as untenable in the Resolution dated July 6, 2009, only the afore-quoted second and third grounds will be resolved. In order to prove its claim that it had properly availed of the Ta x Amnesty Program of the government, petitioner presented and formally offered the following documents: 1. Notice of Availment of Ta x Amnesty dated March 6, 2008; 2. Tax Amnesty Return (BIR Form No. 2116) dated March 6, 2008; 3. DBP BTR-BIR Tax Payment Deposit Slip dated March 6, 2008; 4. Tax Amnesty Payment Form (BIR Form No. 0617) dated March 6, 2008; and 5. Statement of Assets, Liabilities and Networth (SALN) as of June 30, 2005. These documents demonstrate that on March 6, 2008, petitioner availed of the Tax Amn esty Program; paid the amnesty tax based on its Networth as of June 30, 2005; and filed the corresponding documents required for the availment of the tax amnesty under Republic Act (R.A.) No. 9480. Consequently, petitioner i.?a.._

AMENDED DECISION C.T.A. Case No. 6209 entitled to the immunities and privileges granted in Section 6 of the Ta x Amnesty Law, to wit: "Sec. 6. Immunities and Privileges. - Those who availed themselves of the ta x amnesty under Section 5 hereof, and have fully complied with all its conditions shall be entitled to the following immunities and privileges: 1. The ta xpayer shall be immune from the payment of ta xes, as well as addition thereto, and the appurtenant civil, criminal or administrative penalties under the National Internal Revenue Code of 1997, as amended, arising from the failure to pay any and all internal revenue ta xes for ta xable year 2005 and prior years. XXX XXX xxx" These immunities and privileges have been affirmed by the Supreme Court in the case of Philippine Banking Corporation (now: Global Business Ban~ Inc.) vs. Commissioner of Internal Revenue?, when it held that: "Records show that Metrobank, a qualified ta x amnesty applicant, has duly complied with the requirements enumerated in RA 9480, as implemented by DO 29-07 . and RMC 19-2008. Considering that the completion of these requirements shall be deemed full compliance with the ta x amnesty program, the law mandates that the taxpayer shall thereafter be immune from the payment of ta xes, and additions thereto, as well as the appurtenant civil, criminal or administrative penalties under the NIRC of 1997, as amended, arising from the failure to pay any and all internal revenue ta xes for ta xable year 2005 and prior years." Inasmuch as petitioner has fully complied with the prescribed requisites of R.A. No. 9480, it is deemed a duly qualified ta x amnesty applicant; consequently, petitioner's deficiency documentary stamp ta x liabilities are extinguished, while its deficiency final withholding ta x liability stays, since it is specifically excluded by R.A. No. 9480~ 3 G.R. No. 170574, January 30, 2009 • " Sec. 8. Exceptions. - Th e tax amnesty provided in Secti on 5 hereof shall not extend to the following persons or cases existing as of th e effectivity of thi s Act: 1. Withholding agents with respects to their withholding tax liabilities;" 46 S

AMENDED DECISION C.T.A. Case No. 6209 WHEREFORE, premises considered, petitioner's Motion for Reconsideration is hereby PARTIALLY GRANTED and this Court's Decision dated January 20, 2009 is hereby MODIFIED. Accordingly, the above-captioned case as regards petitioner's liability for deficiency documentary stamp tax is CLOSED and TERMINATED, subject to the provisions of R.A. No. 9480. However, petitioner's liability for deficiency final withholding tax assessment for fiscal year ended June 30, 1998, subject of this litigation, in the amount of Pl0,183,367.80, is hereby REAFFIRMED . SO ORDERED . CAESAR A. CASANOVA Associate Justice WE CONCUR: L~... ~ ERNESTO D. ACOSTA CERTIFICATION Pursuant to Article VIII, Section 13 of the Constitution, it is hereby certified that the conclusions in the above Amended Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court's Division. Q----~~ a_~ ERNESTO D. ACOSTA Presiding Justice Chairperson, First Division 46 &