When Prior Authority of the Commissioner is Required in Case of Investigation After Availment of the "Last Priority in Audit and Investigation" Privilege

November 4, 1987 BIR RULING NO. 345-87 246 000-00 345-87 Gentlemen : This refers to your letter dated August 31, 1987 requesting confirmation of your opinion that prior authority of the Commissioner of Internal Revenue is not required for a valid availment of the "last priority in audit and investigation" provided under Revenue Memorandum Order No. 14-87. It is alleged that on August 6, 1987, you notified the Bureau of your intention to avail of the last priority in audit and investigation for taxable year 1986; that on August 14, 1987, you availed of said privilege by filing with the Revenue District Office, Paraaque, Metro Manila your amended income and business tax returns, sworn declaration of inventory and paying the full amount of the corresponding sales tax and the first installment of the income tax due thereunder; that on August 19, 1987, a notice was issued by the Head, BIR Special Investigation Team, advising you to present your books of accounts within five days on the ground that you failed to obtain prior permission from the Commissioner to avail of the "last priority" and that there are other issues involved which are not contemplated in said memorandum order. In reply, please be informed that your opinion is hereby confirmed provided that the conditions imposed by Revenue Memorandum Order No. 14-87 for the availment of the privilege are complied with. The prior authority of the Commissioner is required in case of investigation after availment of the privilege and only in the following instances specified in paragraph II of Revenue Memorandum Order No. 14-87, viz: 1. Where verification is necessary for the Commissioner to obtain information relevant to the tax liability of another person pursuant to Section 7(b) of the Tax Code. 2. Where the taxpayer requests for a refund or credit of the taxes paid. or there is an indication of fraud in the availment of the privilege. Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner