BIR Ruling No. 009-09

April 17, 2009 BIR RULING NO. 009-09 D.O. 20-06; RMC 25-2006 Music Semiconductors Phils., Inc. Lot 8, Phase IIB PEZA I, Carmelray Industrial Park Canlubang, Calamba, Laguna Attention: Ms. Renelia L. Yturzaeta VP-Finance & Admin., CFO Gentlemen : This refers to your letter dated January 19, 2009 requesting appeal of the decision denying the special revalidation of the Tax Credit Certificate (TCC) issued in the name of Music Semiconductors Corporation. Documents submitted disclose that the BIR issued to Music Semiconductors Corporation (TIN 001-817-292-000) Tax Credit Certificate (TCC) No. 2002 00002456 in the amount of P702,543.00 dated April 5, 2001; that the said TCC was revalidated in accordance with Revenue Regulation (RR) 5-2000; that TCC No. 2002 00002593 was issued on December 13, 2005, canceling TCC No. 2002 00002456, to expire on April 5, 2011; that for failure to undergo special revalidation pursuant to Department of Finance Order (D.O.) No. 20-06 dated June 16, 2006 and Revenue Memorandum Circular (RMC) No. 45-2006 dated July 13, 2006, TCC No. 2002 00002593 is no longer valid and cannot be utilized by Music Semiconductors, Phils., Inc.; that the taxpayer wrote the Assistant Commissioner of the BIR Collection Service on September 9, 2009 requesting reconsideration and revalidation of said TCC; and that in a letter addressed to the taxpayer dated November 3, 2008, this request was denied on the ground that there was no compliance with the requirements for special revalidation pursuant to the above-stated D.O. In reply, pleased be informed that D.O. No. 20-06, circularized in Revenue Memorandum Circular (RMC) No. 45-2006 ordered a Special Revalidation Program which refers to the retirement or recall and cancellation of outstanding TCCs and their replacement with new TCCs, utilizing updated forms and containing enhanced security features Sections 5 and 6 of said issuance provide as follows: "Section 5. Period of Revalidation. From August 1 to December 31, 2006, holders of outstanding TCCs shall be required to file their respective applications for revalidation with the concerned agency which issued said TCCs. Section 6. Cancellation of TCCs. Effective August 1, 2006, all outstanding TCCs shall be deemed automatically retired, recalled or cancelled, and shall no longer be accepted as payment for the outstanding tax/duty liability of their respective holder/s." THIAaD D.O. 20-06 was published on June 22, 2006 in the Philippine Star, a newspaper of general circulation and as earlier mentioned in the letter from the Collection Service, a press release covering the revalidation requirements was also published on November 11, 2006 issue of the Daily Tribune newspaper. In the case of Taada vs. Tuvera (G.R. No. L-63915, April 24, 1985) where the issue on publication of acts, orders, proclamations, resolutions of public nature, decisions, documents required by law to be published and the like was discussed, the Supreme Court explained the significance of publication, thus "The clear object of the above-quoted provision is to give the general public adequate notice of the various laws which are to regulate their actions and conduct as citizens. Without such notice and publication, there would be no basis for the application of the maxim "ignorantia legis non excusat". It would be the height of injustice to punish or otherwise burden a citizen for the transgression of a law of which he had no notice whatsoever, not even a constructive one." Music Semiconductors is now bound by said legal maxim, ignorantia legis non excusat or ignorance of the law excuses no one from compliance therewith. That the taxpayer subscribes to newspapers other than that wherein the Department Order was published is of no moment considering that the requirement of publication is to be made in a newspaper of general circulation. The due process requirement of publication having been substantially satisfied, the taxpayer is deemed to have been duly informed and cannot claim ignorance of the issuance pertaining to the special revalidation of its TCC. Based on the foregoing, this Office hereby holds that the appeal of Music Semiconductors for the special revalidation of TCC No. 2002 00002593 is denied for non-compliance with the directives of D.O 20-06. Very truly yours, (SGD.) SIXTO S. ESQUIVIAS IV Commissioner of Internal Revenue