PEOPLE OF THE PHILIPPINES v. FAREAL BUILDERS, INCORPORATED and its responsible officers, FERDINAND I. SANTOS and LILIBETH M. SANTOS 120-B K-8th Street, Barangay East Kamias, Quezon City (-ALL-AT LARGE-)

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY FIRST DIVISION PEOPLE OF THE CTA CRIM CASE NO. 0-958 PHILIPPINES, For: Violation of Section 255 of the Plaintiff, National Internal Revenue Code of 1997, as amended -versus- Members: FAREAL BUILDERS, INC., DEL ROSARIO, P.J., Chairperson, and its responsible BACORRO-VILLENA, and officers, FERDINAND I. CUI-DAVID, JJ. SANTOS and LILIBETH M. Promulgated: SANTOS, Accused. SEP 2~ Cf.wjfl/ X- - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - -X RESOLUTION For resolution is plaintiff's Motion for Reconsideration filed on July 19, 2023, with the accused's Comment/ Opposition (To Plaintiffs Motion for Reconsideration) filed via registered mail on July 27, 2023, and received by the Court on August 1, 2023. In its motion, plaintiff argues that the Information was timely filed on December 1, 2022, based on Section 2 05 (b) in relation to Section 223 of the National Internal Revenue Code (NIRC) of 1997, as amended. Considering that the Warrant of Distraint and/ or Levy (WDL) was r eceived by the accused's representative, Paola Bianca B. Garcia, on May 22, 20 13, and the accused has no record of real properties based on a letter dated February 6, 2014, issued by the City Assessor of Quezon City, the running of the statute of limitations under Section 223 of the NIRC of 1997, as amended, was tolled. On the other hand, the accused contends that Section 223 of the NIRC of 1997, as amended, refers to the running of the statute of limitations provided under Sections 203 and 222 thereof and is inapplicable in a criminal case. Instead, the proper provision governing the prescription of offenses is

RESOLUTION CTA Crim Case No . 0 -958 People of the Philippines vs. Fareal Bu ild er s, Inc. , a n d its responsible officers, Ferdinand I. San tos a nd Lilibeth M. Sa n tos X----------------------------- ------ -------------------------------------------------------X Section 281 of the NIRC of 1997, as amended. Considering that the Information was filed more than the five-year reglementary period under Section 281 of the NIRC of 1997, as amended, the accused's right to dismiss this case cannot be defeated. At the outset, plaintiff puts forth the same argument, which was already considered and passed upon by the Court in its Resolution dated June 21 , 2023. In quashing the Information, the Court explained that the statute of limitations under Section 223 1 of the NIRC of 1997, a s amended, is inapplicable in a criminal case where the prescriptive period for the offense is governed by Section 2812 thereof, viz.: Pla intiff a rgues that Section 223 of th e NIRC of 1997, a s am ended , suspended the running of th e statute of limita tions in a proceeding in court for collection of deficien cy taxes wh en th e WDL is duly served upon th e taxpayer, and n o property could be located . Plaintiff m iscon strued Section 223 as applicable in this case wh en th e p rovision only pertains to in stan ces wh ere the interna l revenue taxes m ay be assessed or collected a fter the ordinary prescriptive p eriod . This is not a regula r or ordinary collection case bu t a crimina l case wh ere th e prescriptive period for t h e violation of a ny p rovision of the NIRC of 1997, as a m en ded , is governed by Section 28 1[.] .. . Applying Lim a nd Tup az, th e cause of action accrued after the BIR served the notice and demand to pay, i.e., FAN a nd F LD , t o t h e accus ed on O c tob er 2 5 , 20 1 2. Eve n with t h e dem a n d to pay, th e accused still refused to pay th eir 1 SEC. 223. Suspension of Running of Statute of Limitations. - The running of the Statute of Limitations provided in Sectio ns 203 and 222 on the making of assessment and the beginning of di strai nt or levy a proceeding in court for co llection, in respect of any defi ciency, shall be suspended for the period during which the Commissio ner is prohibited from making the assessment o r begin ning distraint or levy or a proceedi ng in court and for sixty (60) days thereafier; when the taxpayer requests for a reinvestigatio n which is g ranted by the Commi ssio ner; when the taxpayer cannot be located in the address g iven by him in the return fi led upon which a tax is being assessed or collected: Prov ided, that, if the taxpayer in form s the Commissioner of any change in address, the running o f the Statute o f Limitations wi ll not be suspended; when the warrant of d istraint or levy is duly served upon the taxpayer, his authorized representative, o r a member of his ho useho ld with sufficient d iscretio n, and no property cou ld be located; and when the taxpayer is out of the Philippines. 2 SEC. 28 1. Prescription for Violations of any Provision of!his Code. - All violations of any provision of this C ode shall prescribe after five (5) years. Prescriptio n shall begin to run fr om the d ay of the commiss ion of t he violatio n of the la w, and if the same be not known at the time, from the discovery thereof and the institution of j udicial proceedi ngs for its investigation and p u n is hm e nt. T he prescriptio n sha ll be interru pted when proceedings a re instituted aga inst the guilty perso ns and shall begin to run again if the proceedings are dismissed for reasons not constituting j eopardy.... (Emphasis supplied)

�I RESOLUTION CTA Crim Case No . 0 -958 People of the Philippines vs . Fareal Builders, Inc., and its respon sible officers, Ferdinand I. Santos and Lilibeth M. Santos x------------------------------------------------------------------------------------------x deficiency taxes within the allotted period, as stated in the FAN and FLD . Nor did the accused file their protest within 30 days from receipt of the assessment. Hence, the assessment attained finality on November 24, 2012. From the alleged ((commission" of the offense involving a violation of the NIRC on November 24, 2012, and the filing of the Joint Complaint-Affidavit on April 12, 2018, up to the filing of the Information on Dece mber 1, 2022, more than ten (1 0) years have elapsed . Being over five (5) years la te, the right of the governm ent to institute the instant case against the accused had already prescribed when the Information was filed with this Court on December 1, 2022. The Court finds no convincing reason to reverse the quashal of the Information. As it stands, the filing of the Information in Court on December 1, 2022 was made beyond the five (5) -year prescriptive period as provided under Section 281 of the NIRC of 1997, as amended. WHEREFORE, premises considered, plaintiffs Motion for Reconsideration is DENIED for lack of merit. SO ORDERED. Presiding Justice ~ JEANMA ~;:Pnd LANEE S. CUI-DAVID Associate Justice