Tax Consequence of the Dissolution of NIDC thru the Shortening of Its Corporate Term

January 13, 1987 BIR RULING NO. 004-87 46 (a) 000-00 004-87 Gentlemen : This refers to your letter dated November 11, 1986 stating that the National Investment and Development Corporation (NIDC) will be dissolved thru the shortening of its corporate term to November 30, 1986 as approved in a Special Stockholders' Meeting duly called for the purpose and held on October 13, 1986; that the NIDC dissolution is part of the rehabilitation program of the Philippine National Bank (PNB), NIDC's mother company which includes, among others, the transfer of all assets and liabilities of NIDC to PNB for their inclusion among PNB-owned assets and liabilities to be transferred to the National Government; that the transfer of NIDC assets and liabilities to PNB is subject, among others, to the following guidelines: "1. The transfer shall be value-dated and effected on dates determined by PNB; and "2. NIDC books shall be closed once all requirements for closure are complied with." that the determination of the transfer effectivity dates of NIDC assets and liabilities is not being arbitrarily made by PNB but is a result of urgent non-tax reasons affecting the terms of the transfer of some of PNB's so-called "non-performing assets" to the National Government; that the transfer effectivity date of NIDC assets and liabilities to PNB has been tentatively set for November 30, 1986, that it is legally impossible for NIDC to file correct income and percentage tax returns within the 30-day period required by law; hence, your request that NIDC be allowed to file the required returns within a 30-day period reckoned from the last transfer effectivity date to be determined by PNB as mentioned in condition no. 1 above, the requirements of Sections 46 and 162 (a)(3) of the Tax Code as amended, in case of a corporation contemplating dissolution notwithstanding. In reply, I regret to inform you that your request cannot be granted for lack of legal basis. The filing of the required returns at a time other than as prescribed by Sections 46 and 162 (a)(3) of the Tax Code as amended, shall be fixed and determined, in meritorious cases, only by the Commissioner of Internal Revenue and not by the PNB. Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner