Production of Books of Accounts of a Taxpayer in Court

January 26, 1959 BIR RULING NO. 033-59 The Regional Director BIR Regional District No. 10 Davao City S i r : In further connection with your telegram of January 22, 1959, regarding the subpoena issued in a criminal case by the Court of First Instance, directing you to produce in court the books of accounts of a taxpayer other than the accused in the said criminal case, you are hereby informed that, under the foregoing facts and circumstances, the aforesaid books of accounts cannot be legally required to be produced in court as the production thereof is prohibited under Section 347 of the Tax Code and as decided by the Supreme Court in the case of People vs. Topacio G. Santiago (59 Phil. 356/1934/). (See also Arnaldo et al. vs. Locsin, et al., 69 Phil. 113/1939/). In accordance with our telegram-instructions on the matter of even date, it is desired (1) That you file with said court a motion to quash the subpoena; (2) That, as directed in the subpoena, you appear in court, duly assisted by a special attorney in that Regional Office, to explain the matter to the court, but the books subpoenaed should not be produced; and (3) That, if compelled by the court to produce the books in question, you file immediately a petition for prohibition, with preliminary injunction, invoking the provisions of Section 347 of the Tax Code and the decision of the Supreme Court in the case vs. Topacio & Santiago (supra). In this connection, you are advised that records or documents of a taxpayer in the possession of the Bureau or any of its official or employee may be produced in court only when the following requisites concur: (1) A subpoena is issued by the proper court; (2) The records or documents are to be used as evidence in a criminal case; and (3) The said records or documents belong to the accused himself. (See Cu Unjieng vs. Posadas, 58 Phil. 360/1933/). The records or documents in the possession of the Bureau which pertain to a taxpayer who is not the accused in the criminal case cannot legally be required to be produced in court and in such cases the foregoing instructions should be followed. Although Opinion No. 86, series of 1957, of the Secretary of Justice, copies of which were furnished all regional offices, appears, at first blush, to be broad enough as to include records or documents of a taxpayer who is not the accused in the criminal case, however, a careful examination of the aforesaid Opinion will show that it involves the production of records of Pedro Rural, the very person accused of arson in Criminal Case No. 4588 of the Court of First Instance of Camarines Sur, entitled "People vs. Pedro Pural". aisadc It is desired that this Office be informed of further developments regarding the subpoena in question. Very truly yours, (SGD.) MELECIO R. DOMINGO Acting Commissioner of Internal Revenue