BIR Ruling

August 23, 1967 Col. Jose M. Mendoza General Manager Filipino Pipe and Foundry Corporation P. O. Box 1329, Manila S i r : This has reference to your letter to Undersecretary Juan Ponce Enrile dated May 22, 1967 inviting attention to the adverse decision handed down by Judge Gaudencio Cloribel, CFI, Manila, in Civil Case No. 66750, entitled "C & C Commercial Corporation vs. Antonio C. Menor, et al.," which rendered null and void the NWSA requirement that all bidders submit a tax clearance certificate as a pre-requisite to participation in the public biddings to be conducted by said corporation. Your letter has been referred to use for appropriate action. llcd In reply thereto, I have the honor to inform you that, while the requirement of tax clearance imposed by NWSA aids tax collection, nevertheless, this Office has no cause whatsoever to enter into the controversy. This Office, however, believes that NWSA should have appealed the decision, the requirement being justifiable in law. However, the aforesaid decision, we believe, is now without force and effect in view of Administrative Order No. 66, dated June 26, 1967, of the President of the Philippines, for it is provided therein, viz.: "NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by law, do hereby order the disqualification of any person, natural or juridical, with a pending case before the Bureau of Internal Revenue or the Bureau of Customs or criminal or civil case in court pending or finally decided against him or it involving non-payment of any tax, duty or undertaking with the Government, to participate in public biddings or in any contract with the Government or any of its sub-divisions, branches or instrumentalities, including government owned or controlled corporations, until after such case or cases are terminated in his or its favor, or unless the Secretary of Finance shall certify that such cases are pending and not decided without fault on the part of the taxpayer and the taxpayer submits bond for payment of taxes that may be assessed against him. "Government offices, entities and instrumentalities and local governments shall impose this condition and shall require, in addition, the latest certified copy of BIR Letter of Confirmation Form No. 19.65-E-1 and BIR tax clearance Form No. 17.61 as pre-requisite to participation in any public bidding or execution of any contract with them. Violation of this order shall be a ground for administrative action." LibLex Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue