BIR Ruling No. 573-2017

REPUBLIC OF THE I HILIPPINES

BUREAU OF JNTERNAL REVENUE DEPARTMENT OF FINANCE Duezon City

Bureau of Internal Revenue Ruling

amended Republic Act (RX) No. 9136; the National Internal Revenue Code (NIRC) of 1997. as Date: Decerber 7.2017 RA No. 9520: Section 236 (I) of #E73m3017 Person to Contact: Chief. Law Division Tel. Nos. 926-55-36 / 927-09-63

PCU Annex Building, Barangay Magdum. DAVAO DEL NORTE ELECTRIC COOPERATIVE Tagum City, Davao del Norte

Attention: ENGR. JEROLD M. OSORIO OIC -- General Manager

ENGR. ALBERT M. OMEGA Chairman - BOD

ATTY. BALTAZAR A. SATOR Legal Counsel

Gentlemen:

Norte Eiectric Cooperative ("DANECO" for brevity) for the issuance of a new Tax Identification Number (TIN) and Authority to Print (ATP). This refers to your letter dated February 17, 2017, requesting on behalf of Davao de!

Background:

Stock cooperative duly registered with the Cooperative Develonmcnt Authority (CDA) on May to convert into either stock cooperative under the Cooperatives Development Act or stock 21. 2012. bearing Certificate of Registration No. corporation under the Corporation Code. This resulted to the conversion ot DANECO into a "Electric Power Industry Reform Act of 2001", electric cooperatives had been given the option Pursuant to Section 57 of Republic Act (RA) No. 9136, otherwise known as the

acquired a new juridical personality. Thus, the Board of Directors (BODs) passed a Resolution retiring the TIN By reason of the registration of DANECO with CDA, it is alleged that DANECO Hence, this request.

the CDA. to wit: -Philippine Cooperative Code of 2008", enumerates the effects of subsequent registration with In reply. please be informed that Article 132 of RA No. 9520 otherwise known as the

effectivity of this Code. electric cooperatives that are duly registered'with the Authority, and issued a certificate of registration, shall no longer be covered by Presidential Decree No. 269. as amended hy Presidential Decree No. 1645 Provided. That electric cooperatives registered with the Authority shall now' he "ART. 132. Effects of Registration with the Authority. ... (t) Upon the

DAYAO DEL NORTE ELECTRIC COOPERATIYE (DANECO) 7-2C 17

covered by the provisions of this Code as well as the future rules and issuances of' the Authority: Provided, however, that the security of tenure and the collective bargaining agreement between the cooperative management and its employees shall he respected, with no diminution of their existing salaries. enmoluments, ranks and other benefits:

observe the terms of such loans until full puvment or settlement thereof. existing loans obiuined from the NEA after June 26, 2001 shall continue to "(2) The electric cooperatives registered with the Authority with

NEA shall no longer exercise regulatory or supervisory powers on electric cooperatives duly registered with the authority "(3) Except as provided in the immediately preceding puragraph, the

registered under this Code can avail of the financial services and technical development agencies on terms respecting their independence us autonomous congressional allocations, grants. subsidies and other financial assistance for the Authority andior local government units. The electric cooperatives assistance provided by the government financial institutions and technical rural electrifications which can be coursed through the Departiment of Energy. cooperatives: (4) Electric cooperatives registered with the Authority are entitled to

forn part of the donated capital and funds of the electric : "(5) All condoned toans. subsidies, grants and other ussistance shall Yperatives and a.

these donated capital/fund shall be valuated for the sole purpose of determining the equity participation of the members;: Provided. That in the case of dissolution of the cooperative. said donated capital shall be subject to escheat. registered under this Code. and under Republic Act No. 6938 and Republic Act No. 6939 are hereby deemed uch, it shall not be sold, traded nor be divided into shareholdings at any time. "(6) Electric cooperatives registered and confirmed with the Authority

the juridical personality of an electric cooperative formerly registered with the National Electrification Authority (NEA). was neither dissolved nor did it cease operations. Aside from this. RA No. 9520 does not provide that subsequent registration with the CDA causes the dissolution or the cessation of Under the above quoted provision, it is clear that the entity DANECO still exists. It

provides: Moreover, Section 236 (1) of the National Internal Revenue Code of 1997, as amcnded.

"SEC. 236. Registration Requirements.

XXX xXX CX

(I) Supplying of Taxpayer Identification Number (TIN).

or file a return. statement or other document shall be supplied with or assigned identification for tax purposes. and which he shall indicate in certain docunents, such as. but not limited to the following: a Taxpaver Identification Number (TIN) which he shall indicate in such return. statement or document filed with the Bureau of Internul Revenue for his proper Any person reauired under the authority of this Code to make. render

XX:X XXX XXX

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DAYAO DEL NORTE ELECTRIC COOPERATIVE (DANECO) i373-20 17 12-7-2017

a taxpaver. Amv person who shall secure more than one Taxpaver ldentification Number shall be criminallv liable under the provision of Section 275 on (Emphasis supplied) Violation of Other : Only one Tuxpaver Identification Number (TIN) shall be assigned to Provisions of this Code or Regulations in General'.

DANFCO can do is to update its registration by using BIR Form No. 1905 which must be done at the Revenue District Office (RDO) which has jurisdiction over DANECO's head office. Otherwise. this violates Section 236 of the National Internal Revenue Code of_1997. as amended. It thus follows that it cannot also be allowed to apply for a new ATP. What From the foregoing. it is clear that DANECO should not be allowed to have a new 'TIN

Pleasc be guided accordingly.

Very truly yours.

A&wcw1a M

1-K-I-LMAT Commissioner of Internal Revenue CAESAR R. DULAY 011643

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