COMMISSIONER OF INTERNAL REVENUE v. MONTALBAN METHANE POWER CORPORATION

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY ENBANC COMMISSIONER OF CTA EB NO. 2881 INTERNAL REVENUE, (CTA Case No . 10038) Petitioner, Present: -versus- RINGPIS-LIBAN, Acting P.J., MANAHAN , BACORRO-VILLENA, MODESTO-SAN PEDRO, REYES-FAJARDO , CUI-DAVID , FERRER-FLORES, and ANGELES, JJ. Promulgated: MONTALBAN METHANE POWER CORPORATION, Respondent. NOV 25 2025 I,L _=JjF:~ .:~/:-' � X - - - - - - - - - - - - - - - - - - - - - - - - - - - - RESOLUTION CUI-DAVID, J. : This resolves petitioner's Motion for Reconsideration filed on July 8, 2025, with respondent's Comment (Re: Petitioner's Motion for Reconsideration dated 7 July 2025) filed on August 20, 2025. Petitioner seeks reconsideration and reversal of the Decision dated June 20, 2 025 (assailed Decision), which reads: WHEREFORE, the Pe tition for Review is DISMIS SED for lack of jurisdiction. SO ORDERED. In his Motion for Reconsideration, petitioner argues th at the Court erred in dismissing the Petition for Review for having

RESOLUTION CTA EB No. 2881 (CTA Case No. 10038) Commissioner of Internal Revenue v. Montalban Methane Power Corporation X------------------------------------------------------------------------------------X been filed out of time. Petitioner contends that the reckoning date for the filing should be February 19, 2024, when the Bureau of Internal Revenue (BIR) Legal Division received the assailed Resolution, rather than February 13, 2024, when the Office of the Solicitor General (OSG) received it. Petitioner invokes the Memorandum of Agreement (MOA) between the OSG and the BIR, published under Revenue Memorandum Circular (RMC) No. 25-2010, which deputizes BIR lawyers as lead counsel in tax cases before the Court of Tax Appeals. Petitioner argues that since BIR lawyers actively litigated the case and the OSG did not enter its appearance, the date of receipt by the BIR should be controlling. Petitioner further pleads for leniency and liberality in the interpretation of procedural rules in the interest of substantial justice, citing Supreme Court rulings that relaxed procedural timelines. Additionally, petitioner disputes the Court's finding that the Final Assessment Notice (FAN) violated respondent's right to due process, asserting that respondent's Reply to the Preliminary Assessment Notice (PAN) lacked substantive arguments or supporting documents, and therefore did not merit consideration. Respondent opposes the motion by asserting that the Court correctly ruled that the reckoning date for filing the petition is the date the OSG received the resolution. Respondent emphasizes that the OSG remains the principal counsel of the government, and that service upon deputized counsel does not bind the government. Respondent further argues that the absence of express authorization from the OSG to the BIR lawyers renders the petition invalid. Respondent points out that petitioner failed to attach any deputization order or even a copy of RMC No. 25-2010 to the pleadings. On the issue of due process, respondent maintains that the FAN was a mere copy of the PAN and failed to address the defenses raised in its reply. This omission, according to respondent, violated Section 228 of the National Internal Revenue Code (NIRC) of 1997, as amended, and rendered the assessment void, as held in Commissioner of Internal Revenue v. Avon Products Manufacturing, Inc. (Avon). 1 (i.R. :-.los. 201398-99 & 20 I.J.\8-19. Octoh~r 3. 10 IS [Per .J. L:oncn. Third Di\'ision ].

RESOLUTION CTA EB No. 2881 (CTA Case No. 10038) Commissioner of Internal Revenue v. Montalban Methane Po\ver Corporation )C------------------------------------------------------------------------------------x After a thorough review of the arguments raised, the Court finds no merit in the Motion for Reconsideration. RMC No. 25-2010 is clear that the OSG remains the lead counsel, and merely deputizes BIR lawyers for cases appealed to the Court En Bane. As explained in the assailed Decision, jurisprudence consistently affirms that the OSG is the principal counsel of the government, and that service of court issuances upon the OSG, not upon deputized counsel, is the reckoning point for computing reglementary periods. The OSG received the assailed resolution on February 13, 2024, making the deadline to file a petition or a motion for extension on February 28, 2024. Petitioner's Motion for Reconsideration, filed on March 4, 2024, was clearly filed beyond the prescribed period. The Court also finds no merit in petitioner's claim that respondent's Reply to the PAN lacked any argument. The FAN issued was a mere reiteration of the PAN, with no explanation for rejecting the taxpayer's reply. This failure violates Section 228 of the NIRC of 1997, as amended, and constitutes a denial of due process, rendering the assessment void, consistent with the ruling in Avon. WHEREFORE, petitioner's Motion for Reconsideration is DENIED for lack of merit. SO ORDERED. LAN~Iut~VID Associate Justice WE CONCUR: MA. BELEN M. RINGPIS-LIBAN Associate Justice c~�J-~ CATHERINE T. MANAHAN Associate Justice

RESOLUTION CTA EB No. 2881 (CTA Case No. 10038) Commissioner of Internal Revenue v. Mentalban Methane Power Corporation Page 4 of4 ){------------------------------------------------------------------------------------){ ~ A. BACORRO-VILLENA ~ ~f~-fa;~ MARIAN IVY~. REYis-FAjARDO Associate Justice ON lEAVE CORAZON G. FERRER-FLORES Associate Justice ON LEAVE HENRY S. ANGELES Associate Justice