BIR Ruling [DA-334-05]

July 29, 2005 BIR RULING [DA-334-05] Atty. J. Raoul C. Dizon 27 Irwin Street, Filinvest Homes II Batasan Hills Quezon City S i r : This refers to your letter dated July 20, 2005 requesting on behalf of the Heirs of Santos Magsalay for a second extension of time within which to pay the estate tax from July 28, 2005 or until July 28, 2007. It appears that on July 29, 2003 the Heirs of the Santos Magsalay, formerly of Lanao del Norte were granted an extension of up to July 28, 2005 within which to pay the estate tax pertaining to the three (3) titled properties left by said Mr. Magsalay, which are all located in Kapatagan, Lanao del Norte; that these titled properties were all voluntarily surrendered by Mr. Magsalay to the Department of Agrarian Reform (DAR) in 2001 under the latter's Voluntary-Offer-To-Sell (VOS) Program to signify his cooperation with the policy of the government to distribute land to the landless; that the Heirs of Santos Magsalay asked for the aforesaid extension because they assumed that after four (4) years from the properties' surrender, the government would have already processed the lands of Mr. Magsalay and paid for them; that unfortunately, their assumption was wrong; that DAR personnel insist they are not at fault, tossing the blame on the Land Bank of the Philippines (LBP) which, they claim, keeps on adding new requirements; that the DENR-CENRO of Kolambugan, Lanao del Norte, had even issued two (2) certifications that one of the properties of Mr. Magsalay is timberland and not within the commerce of man; that this meant that if they insist on getting paid for that piece of land, they just have to file suit and prove that the property is actually private; and that the incredible delay in the processing of the properties plus the uncertainty of payment now poised by the CENRO certifications, combine to signify more delay before the Magsalay family can ever count on being paid. In reply thereto, please be informed that in view of the aforementioned valid and justifiable ground, your request for an extension of two (2) years to pay the estate tax reckoned from July 28, 2005 or until July 28, 2007, is hereby granted pursuant to Section 91 of the Tax Code of 1997. ACDTcE It is, however, understood that the estate of Santos Magsalay shall be liable to the corresponding interest that have accrued up to the time of the payment of the estate tax. Very truly yours, (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service