TRULLY NATURAL FOOD CORP., represented by its Executive Vice President/ General Manager Rodolfo C. Sobong v. DEPARTMENT OF FINANCE

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY ENBANC TRULLY NATURAL FOOD CTA EB No. 1077 CORP., represented by its (CTA Case No. 8353) Executive Vice President/ General Manager, Present: RODOLFO C. SOBONG, Petitioner, -versus- Del Rosario, PJ, Castafteda, Jr., Bautista, Uy, Casanova, Fabon-Victorino, Mindaro-Grulla, Cotangco-Manalastas, and Ringpis-Liban, JJ. Promulgated: DEPARTMENT OF FINANCE, Respondent. JUN 08 2015 f/cJ5"Q X- - - - - - - - - - - - - - - - - - - - - - - - - - - - ~ :.~:. X R E S O L U T I O N.. COTANGCO-MANALASTAS,J.: For resolution is petitioner's Motion for Reconsideration1 filed through registered mail on October 9, 20 14 and received by this Court on October 16, 2014 with respondent's Comment (to the Motion for Reconsideration dated October 8, 2014)2 filed through registered mail on February 12, 2015 and received by this Court on February 24, 2015. Petitioner moves for the reconsideration of this Court's V Decision 3 dated September 8, 2014, which dismissed the instant petition for review for lack of merit. 1 Rollo, pp. 221-226. 2 Rollo, pp. 245-249. 3 Rollo, pp. 200-215.

RESOLUTION Page 2 of4 CTA EB No. 1077 (CTA Case No. 8353) TruBy Natural Food Corp. vs. Dept. of Finance Petitioner reiterates its argument that the subject imported plastic rolls are used solely and exclusively for the packaging of petitioner's dried mangoes to be sent abroad. The imported plastic rolls with dried mangoes inside are then re-exported within a period of six (6) months from importation. Clearly, these subject imported plastic rolls are conditionally- free importations under Section 1OS(m) of the Tariff and Customs Code of the Philippines (TCCP). Concerning petitioner's alleged failure to comply with Customs Administrative Order (CAO) No. 7-72, as amended, particularly the submission of the Affidavit of the Importer, petitioner argues that the Court must give weight and consideration to petitioner's good faith in complying with the provisions of Section 1OS(m) of the TCCP. This is clearly demonstrable when petitioner secured the importation with a 150�/o re-export bond to ensure payment of the duties and taxes and any other damage that may be incurred by reason of the said importations. If not for the Collector of Customs Atty. Elvira Cruz's negligence in failing to advise petitioner of the requirements of CAO No. 7-72, this inadvertence could not have arisen. Equally important, the administrative order being adduced by the Office of the Solicitor General is in the nature of an internal regulation which petitioner was not aware of. At the very least, it was not notified of the requirements set therein, to its prejudice. In her comment, respondent counter-argues, among others, that as an importer, petitioner is presumed to know all the rules and regulations of the Bureau of Customs with regard to the requirements needed before its shipments may be entered duty free, particularly CAO No. 11-74. We find no merit in the motion for reconsideration. A perusal of petitioner's Motion for Reconsideration clearly reveals that the grounds relied upon are but a mere rehash or reiteration of the arguments raised before the Court in Division and the Court En Bane. Since the matters raised in the instant motion had already been thoroughly discussed and passed upon in the assailed Decision and no new issues or matters have been raised therein, this Court will no longer address the same.~

RESOLUTION Page 3 of4 CTA EB No. 1077 (CTA Case No. 8353) Trully Natural Food Corp. vs. Dept. of Finance As to petitioner's contention that it was not informed of CAO No. 7-72, We find the same devoid of merit. Administrative regulations enacted by administrative agencies to implement and interpret the law which they are entrusted to enforce have the force of law and are entitled to respect. Such rules and regulations partake of the nature of a statute and are just as binding as if they have been written in the statute itself.4 Section 105(m) of the TCCP clearly provides that the articles shall be exempt from the payment of import duties upon compliance with the formalities prescribed in, or with, the regulations which shall be promulgated by the Commissioner of Customs with the approval of the Secretary of Finance. In relation thereto, paragraph I (M) of CAO No. 7-725, as amended by CAO No. 11-74, provides for such formalities to be complied with. Petitioner cannot escape compliance with the formalities prescribed therein on the basis that it was not informed of these requirements as ignorance of the law excuses no one from compliance therewith6. WHEREFORE, premises considered, the instant Motion for Reconsideration is hereby DENIED for lack of merit. SO ORDERED. L)/-4--~~ AMELtr~:~OTANGCO-MANALASTAS Associate Justice WE CONCUR: OSARIO Presiding Justice ~~" CcA.ST~AN~ED~A~ ~' LOVELL Associ JU}(NITO C. crR. Associate Justice 4 Abakada Guro Party List vs. Purisima, G.R. No. 166715, August 14, 2008. 5 Regulations Implementing Section 105 ofthe Tariff and Customs Code ofthe Philippines, as Amended by Presidential Decree No. 34 Dated October 27, 1972. 6 Article 3, New Civil Code.

RESOLUTION Page4 of4 CTA EB No. 1077 (CTA Case No. 8353) Trolly Natural Food Corp. vs. Dept. of Finance CAES~SANOVA Associate Justice E~P.UY Associate Justice r~ .--tt0 t� NN.. M~- G~ MINDARO-GRULLA Associate Justice C)(N.. ~ ~- ~� MA. BELEN M. RINGPIS-LIBAN Associate Justice

Republic of the Philippines COURT OF TAX APPEALS Quezon City EN BANC COMMISSIONER OF INTERNAL CTA EB CASE NO. 1076 REVENUE, (CTA Case No. 8135) Petitioner, Present: -versus- DEL ROSARIO, P.J., CASTANEDA, JR. ALPHA RIGGING & MOVING BAUTISTA SYSTEMS, INC., UY CASANOVA Respondent. FASON-VICTORINO MINDARO-GRULLA COTANGCO-MANALASTAS RINGPIS-LIBAN, JJ. RESOLUTION MINDARO-GRULLA, J.: This resolves Commissioner of Internal Revenue's (CIR) "Motion for Reconsideration" of the Decision dated January 8, 2015 of this Court en bane, the dispositive portion of which states: "WHEREFORE, premises considered, the petition is DENIED. The Decision of the Special Third Division of this Court in CTA Case No. 8135, promulgated on July 12, 2013 and its Resolution, promulgated on October 9, 2013, are hereby AFFIRMED. No pronouncement as to costs. SO ORDERED." CIR claims that the Court erred when it ruled that the assessment issued against respondent is void. CIR argued as follows: 1. "The jurisdiction of the Honorable Court over collection procedures of final and executory assessments is limited to the timeliness and validity of the collection procedure itself but not to inquire into the validity of the 4.

CIR vs. Alpha Rigging & Moving Syslems Inc. Page 3 of 5 CIA t:B Case No. 10/6 (CIA Case No. 813~)) RESOLUTION Void assessment bears no fruit. Failure to comply with the notice requirements prescribed under Section 228 of the National Internal Revenue Code of 1997 and Revenue Regulations (R.R.) No. 12-99 will result to a denial of due process, irregardless of the failure to file a protest in the assessment. 1 In this case, CIR failed to prove the receipt of PAN and FAN. To reiterate, "xxx, the Court is not precluded from determining compliance with the requirements of due process laid down by the law and by the BIR itself in the issuance of deficiency tax assessment to determine the validity of the warrant of distraint and levy. Evidently, the preliminary assessment notice and final assessment notice must be sent to the taxpayer informing the facts and the law on which the assessment was based. The sending of PAN and FAN to a taxpayer to inform him of the assessment made is but part of the "due process requirement in the issuance of a deficiency tax assessment," the absence of which renders nugatory any assessment made by the tax authorities. In the case at bar, the Court's Division found that petitioner's witness testified that FLO and FAN 59/2000 and 2001 PAN were mailed and received by respondent, however, CIR failed to mark, offer, identify and admit as evidence any registry receipt and return card to prove the fact of mailing and receipt. Likewise we note in CIR's Answer to the petition before this Court in Division on alleged registry receipt and return card to prove the fact of mailing and receipt by the taxpayer, however, no evidence was marked, offered, identified and admitted during trial. This is clear error on the part of CIR, the omission to mark, offer, identify and admit during trial the registry receipt and return card or any other evidence to prove the fact of mailing and receipt by the taxpayer of the PAN and FAN cost the government the 2000/2001 assessment. As to CIR's claim that this Court in Division erred in invalidating the 2001 assessment for failure to serve the PAN when it is not an issue and that respondent even admitted it was informed of the PAN, we find no merit. A perusal of the respondent taxpayer's pre-trial brief reveals that among the issues raised is that CIR did not afford the taxpayer its right to due process". In addition,{ 1 Commissioner of Internal Revenue vs. Metro Star Superama Inc.,G.R. No. 185371, December 8, 2010.

CIR vs. Alpha l~igging & Moving Syslems Inc. Page t1 of 5 CIA I::B Case No. 10/6 (CIA Case No. 813~)) RESOLUTION the Court in Division, a court of competent jurisdiction is vested with the authority to resolve even unassigned issues and it can do so when such a step is indispensable or necessary to a just resolution of issues raised in a particular pleading or when the unassigned issues are inextricably linked or germane to those that have been pleaded. This Court find that the Court in Division did not err when it resolved an issue not specifically raised when the consideration of which is necessary in arriving at a just and complete resolution of the case. To reiterate, the sending of PAN to a taxpayer is part of the "due process requirement in the issuance of a deficiency tax assessment," the absence of which renders nugatory any assessment made. CIR failed to mark, offer, identify and admit as evidence any registry receipt and return card to prove the fact of mailing and receipt. xxx." In sum, the basic issues have already been passed upon and no substantial argument has been adduced to warrant the reconsideration sought. WHEREFORE, premises considered, petitioner's "Motion for Reconsideration" is hereby DENIED for lack of merit. SO ORDERED. ~ N.M~~-C~ WE CONCUR: CIELITO N. MINDARO-GRULLA Associate Justice Presiding Justice (On Official Busintss) (On Official Busin._.) JUANITO C. CASTANEDA, JR. LOVELL R. BAUTISTA Associate Justice Associate Justice " CAES Associate Justice ERL~P.UY Associate Justice

C,ll~ vs. Alpha l<igging & Moving Syslems Inc. Page 5 of 5 CIA t:B Case No. 10/6 (CIA Case No. 813~)) RESOLUTION < (On Official Business) AMELIA R. COTANGCO-MANALASTAS Associate Justice (On Leave) MA. BELEN RINGPIS-LIBAN Associate Justice

Cll~ vs. Alpha l~igging & Moving Syslems Inc. Page? of 5 CIA 1:13 Case No. 10/6 (CIA Case No. 813~)) RESOLUTION undisputed assessments. To sanction the latter would be to allow indirectly what the law forbids to be done directly." 2. "Assuming the Honorable Court may allow a collateral attack on the year 2000 assessment despite the clear prohibition by law and jurisprudence, it was clear error to shift the burden of proof on the service of the assessment to petitioner. Even respondent's evidence shows that it was aware of the assessment all along. Thus, the denial of receipt was clearly an afterthought by respondent over four (4) years later and only upon service of the WDL. A bare denial, unsupported by its own evidence cannot operate to overcome a disputable presumption." 3. "Assuming the Honorable Court may allow collateral attack on the year 2001 assessment despite the clear prohibition by law and jurisprudence, it was clear error to invalidate the said assessment on a non-issue. The parties never considered this supposed failure to issue a year 2001 preliminary assessment as an issue in all their pleadings. As a matter of fact, respondent even admitted that it was indeed issued. Thus, not being an issue to the parties, and even more, the issuance of the year 2001 preliminary assessment being admitted by respondent, evidence on the matter would be immaterial and irrelevant." In its Comment/Opposition, respondent claims that the motion was anchored on the same arguments discussed in the petition and that there were no additional factual or legal arguments that were not already discussed. We resolve to deny the motion.~