Commissioner of Internal Revenue v. Mercury Group of Co., Inc.

EN BANC [C.T.A. EB CASE NO. 2215. June 30, 2021.] (C.T.A. Case No. 9531) COMMISSIONER OF INTERNAL REVENUE , petitioner , vs. MERCURY GROUP OF COMPANIES, INC. , respondent . DECISION BACORRO-VILLENA , J p : Before the Court En Banc is a Petition for Review 1 pursuant to Section 3 (b), 2 Rule 8 of the Revised Rules of the Court of Tax Appeals (RRCTA) filed by petitioner Commissioner of Internal Revenue (petitioner/CIR) . He seeks the reversal and setting aside of the Decision dated 06 September 2019 3 (assailed Decision) and Resolution dated 02 January 2020 4 (assailed Resolution) ,respectively, of the Court's Special Second Division 5 in CTA Case No. 9531, entitled Mercury Group of Companies, Inc. v. Commissioner of Internal Revenue . PARTIES OF THE CASE Petitioner is the duly appointed CIR vested with authority to carry out the functions, duties, and responsibilities of the said office including, among others, to decide disputed assessments, refunds of internal revenue taxes, fees, other charges, and penalties imposed in relation thereto, or other matters arising under the National Internal Revenue Code (NIRC) of 1997, as amended, or other laws or portions thereof administered by the Bureau of Internal Revenue (BIR) . Respondent Mercury Group of Companies, Inc. (respondent/MGCI) ,on the other hand, is a domestic corporation under Philippine laws with principal office at No. 7, Mercury Avenue, Bagumbayan, Quezon City and is primarily a holding and investment company. 6 It is registered with the BIR with Tax Identification Number (TIN) 000-389-266-000, as evidenced by BIR Certificate of Registration No. OCN 8RC00000017125. 7 FACTS OF THE CASE On 19 May 2010, respondent received the BIR's Letter of Authority (LOA) No. LOA-116-2010-00000071 dated 14 May 2010, 8 authorizing Revenue Officers (ROs) Olivia Sison (Sison) ,Walter Batoon (Batoon) ,Reynoso Bravo (Bravo) ,Daniella Gabaon (Gabaon) ,Julieta Tubilla (Tubilla) and Maribel Serafica (Serafica) and Group Supervisor Erlinda Ulgado (GS Ulgado) of the Large Taxpayers Audit Division I (LTAD I) to conduct a tax audit investigation of respondent's books of accounts and other accounting records for taxable year (TY) 2009. Petitioner and respondent successively executed four (4) Waivers of the Defense of Prescription under the Statute of Limitations of the NIRC of 1997, as amended, detailed as follows: Waiver Date of Execution Extension of Period to Assess Date of Acceptance by the BIR 1st Waiver 9 14 June 2012 30 June 2013 26 June 2012 2nd Waiver 10 22 March 2013 31 December 2013 03 April 2013 3rd Waiver 11 16 October 2013 30 June 2014 29 October 2013 4th Waiver 12 12 March 2014 31 December 2014 21 March 2014 On 31 July 2013, the BIR, through RO Sison, received respondent's documents which were submitted in relation to the audit investigation for TY 2009. 13 On 27 February 2014, respondent received a copy of the Preliminary Assessment Notice 14 (PAN) of even date, with attached Details of Discrepancies, 15 assessing it for deficiency income tax (IT) ,value-added tax (VAT) ,expanded withholding tax (EWT) ,withholding tax on compensation (WTC) ,documentary stamp tax (DST) and improperly accumulated earnings tax (IAET) in the aggregate amount of P981,482,971.93, inclusive of penalties, interest and surcharges for TY 2009. CAIHTE On 02 April 2014, respondent received a copy of the Formal Letter of Demand 16 (FLD) of even date, with attached Details of Discrepancies 17 and Assessment Notices, 18 finding it liable for deficiency IT, VAT, EWT, WTC, DST, IAET and other miscellaneous tax in the total amount of P999,385,542.40, broken down as follows: Tax Type Amount IT P570,294,505.13 VAT 163,283,304.39 EWT 1,234,462.74 WTC 3,804,913.25 DST 12,058,652.72 IAET 248,699,704.17 Other miscellaneous tax 10,000.00 Total P999,385,542.40 Then BIR Commissioner Kim S. Jacinto-Henares (Commissioner Henares) signed both the PAN and the FLD. On 10 April 2014, respondent filed its Protest dated 07 April 2014 19 against the FLD. Thereafter, on 30 April 2014, respondent filed its Supplemental Protest. 20 Through a Letter dated 30 June 2014, 21 it also submitted the last batch of documents in support of its Protest. On 04 June 2014, respondent, in a Letter dated 03 June 2014, 22 informed petitioner that it partially paid the deficiency IT, VAT, EWT, WTC, DST, and other miscellaneous tax on the following dates as shown in the respective BIR Forms No. 0605: 23 Tax Type Date Paid Basic Tax Surcharge Interest Compromise Total IT 30 April 2014 P34,418.40 P- P27,817.61 P8,500.00 P70,736.01 VAT 30 April 2014 268,830.24 - 229,205.40 16,000.00 514,035.64 EWT 30 April 2014 237,005.83 - 231,476.28 16,000.00 484,482.11 WTC 30 April 2014 100,939.43 - 86,614.33 16,000.00 203,553.76 DST 07 April 2014 148,325.96 37,081.49 126,056.75 - 311,464.20 30 April 2014 - - - 16,000.00 16,000.00 Other 30 April 2014 - - - 10,000.00 10,000.00 miscellaneous tax Total P789,519.86 37,081.49 P701,170.37 P82,500.00 P1,610,271.72 On 30 June 2014, respondent, in a Letter 24 of even date, submitted reconciliations and schedules to further dispute the deficiency taxes assessed under the FLD. Subsequently, on 05 January 2017, respondent received a copy of petitioner's Final Decision on Disputed Assessment (FDDA) dated 04 January 2017, 25 with attached Details of Discrepancies and Assessment Notices. The FDDA stated that after considering respondent's Protest, petitioner still found respondent liable to pay deficiency IT, VAT and EWT in the total amount of P230,361,451.14, inclusive of interest, surcharges and compromise penalties, broken down as follows: DETACa Tax Type Amount IT P220,882,888.62 VAT 9,174,355.64 EWT 304,206.88 Total P230,361,451.14 BIR Commissioner Caesar R. Dulay (Commissioner Dulay) signed the FDDA, which no longer included the assessments for deficiency WTC, DST, IAET and other miscellaneous tax. On 27 January 2017, respondent paid the remaining assessment for deficiency EWT amounting to P304,206.88 as evidenced by BIR Form No. 0605, 26 broken down as follows: Basic tax P118,022.69 Interest 183,184.19 Compromise penalty 3,000.00 Total P304,206.88 PROCEEDINGS BEFORE THE COURT On 02 February 2017, and within thirty (30) days from receipt of the FDDA, petitioner filed a Petition for Review 27 before the Second Division docketed as CTA Case No. 9531, praying for the cancellation and setting aside of the assessments per FDDA but in the increased amount of P231,430,451.14, inclusive of P1,069,253.77 (which amount pertains to the basic tax, interest and compromise penalties paid by respondent on 30 April 2014 and already credited by petitioner to arrive at the deficiency tax still due per FDDA),detailed as follows: Assessed Amount Per FDDA Less: 30 April 2014 Payment 28 Deficiency Tax Still Due IT: Basic tax P97,811,112.78 P34,418.40 P97,776,694.38 Interest up to 30 April 2014 79,052,817.18 27,817.61 79,024,999.57 Interest from 01 May 2014 to 31 July 2016 44,039,694.67 - 44,039,694.67 Compromise 50,000.00 8,500.00 41,500.00 Subtotal P220,953,624.63 P70,736.01 P220,882,888.62 VAT: Basic tax P4,311,122.06 P268,830.24 P4,042,291.82 Interest up to 30 April 2014 3,531,576.70 229,205.40 3,302,371.30 Interest from 01 May 2014 to 31 July 2016 1,820,692.53 - 1,820,692.53 Compromise 25,000.00 16,000.00 9,000.00 Subtotal P9,688,391.29 P514,035.64 P9,174,355.65 EWT: Basic tax P355,028.52 P237,005.83 P118,022.69 Interest up to 30 April 2014 304,643.65 231,476.28 73,167.37 Interest on late remittance 72,858.10 - 72,858.10 Interest from 01 May 2014 to 31 July 2016 53,158.72 - 53,158.72 Compromise 3,000.00 16,000.00 (13,000.00) Subtotal P788,688.99 P484,482.11 P304,206.88 Grand Total P231,430,704.91 P1,069,253.76 29 P230,361,451.15 30 Petitioner then filed his Answer to respondent's original Petition for Review on 01 March 2017. 31 In response thereto, respondent filed its Reply on 16 March 2017. 32 The Second Division issued a Notice of Pre-Trial Conference 33 on 06 March 2017 and set the case for pre-trial conference on 16 March 2017. Accordingly, petitioner filed his Pre-Trial Brief 34 on 09 March 2017, while respondent filed its Pre-Trial Brief 35 on 25 April 2017. Meanwhile, on 09 March 2017, respondent filed an Omnibus Motion, 36 requesting the Second Division to deny petitioner's Motion to Defer Transmittal of BIR Records 37 (Motion to Defer) and to defer the previously scheduled pre-trial conference. The Second Division, however, had already granted petitioner's Motion to Defer in an Order dated 06 March 2017. 38 aDSIHc During the pre-trial on 16 March 2017, respondent moved to reset the pre-trial to 11 May 2017 considering that petitioner has yet to transmit to the Second Division the pertinent BIR Records. 39 The Second Division granted the same, without objection from petitioner's counsels. 40 However, it likewise ordered that should the parties file a Joint Stipulation of Facts and Issues (JSFI) on or before 17 April 2017, the pre-trial scheduled on 11 May 2017 will be cancelled and the initial presentation of respondent's evidence will proceed on 24 May 2017. On 03 May 2017, the parties submitted their JSFI. 41 After the Second Division cancelled the 11 May 2017 schedule for continuation of the pre-trial conference, it instead issued the Pre-Trial Order on 09 May 2017. 42 In a motion filed on 16 May 2017, respondent requested the Second Division to reset the initial presentation of its evidence to the next scheduled hearing (on 26 June 2017) and to grant respondent's four (4) commissioner's hearings to complete the comparison and marking of its documentary exhibits. 43 In an Order dated 18 May 2017, 44 the said motion was granted. Thereafter, trial ensued where respondent presented the testimony of its lone witness, Mario L. Montellano (Montellano) ,the Treasurer and Vice-President for Finance of MGCI. 45 After the presentation of its evidence, respondent filed its Formal Offer of Evidence (FOE) on 07 August 2017. 46 In the Resolution dated 19 September 2017, 47 the Second Division admitted all of respondent's exhibits except for Exhibits "P-33-b", 48 for not being found in the records, "P-35-b", 49 for failure to identify, "P-50-i","P-51-j-31","P-51-j-32","P-51-j-33","P-51-j-34","P-51-j-36","P-51-j-37","P-51-j-38","P-51-j-39","P-51-j-40","P-51-j-41","P-51-j-42","P-51-j-43","P-51-j-44","P-51-j-45","P-51-j-46","P-51-j-47","P-51-j-48","P-51-j-49","P-51-j-50","P-51-j-51","P-51-j-52","P-51-j-53","P-51-j-54","P-51-j-55","P-51-j-56","P-51-j-57" and "P-59", 50 for failure to submit the originals for comparison, and Exhibit "P-58", 51 for failure to identify and submit the original for comparison. At the hearing held on 20 September 2017, petitioner presented his lone witness, RO Sison. 52 Thereafter, he filed his FOE 53 on 10 October 2017. On the other hand, on 03 October 2017, respondent filed a Manifestation with Motion for Partial Reconsideration 54 asking mainly for the approval of its tender of excluded evidence and later, on 27 October 2017, a Comment 55 to petitioner's FOE. On 04 July 2018, 56 the Second Division admitted Exhibits "P-50-i","P-52","P-55-c" and "P-55-d",but still denied admission of Exhibits "P-58", 57 for failure to identify and submit the original for comparison, and "P-59", 58 for failure to submit the original for comparison. It, however, noted respondent's tender of excluded evidence and granted both parties a period of 30 days from notice within which to file their respective memoranda. Petitioner filed his Memorandum 59 on 07 August 2018 while respondent filed its Memorandum 60 through registered mail on 15 August 2018. On 29 August 2018, respondent filed a Motion to File and Admit Attached Reply-Memorandum. 61 In view of the filing of petitioner's Memorandum 62 and respondent's Memorandum 63 and Reply-Memorandum, 64 the case was deemed submitted for decision. 65 In the assailed Decision dated 06 September 2019, 66 the newly constituted Special Second Division 67 partially granted respondent's Petition for Review. The dispositive portion thereof reads: ETHIDa xxx xxx xxx WHEREFORE ,premises considered, the Petition for Review is PARTIALLY GRANTED .The assessments issued by respondent against petitioner for the taxable year ended December 31, 2009 covering deficiency income tax, VAT, and EWT are UPHELD IN PART .Accordingly, petitioner is ORDERED TO PAY respondent the aggregate amount of ONE MILLION THREE HUNDRED NINETY-SEVEN THOUSAND FOUR HUNDRED SIXTY PESOS AND NINETY-SEVEN CENTAVOS (P1,397,460.97) , inclusive of the 25% surcharge, 20% deficiency interest and 20% delinquency interest imposed under Sections 248(A) (3), 249(B) and (C) of the 1997 NIRC, as amended, respectively, computed until December 31, 2017, as follows: Income Tax VAT EWT Total Basic tax due P93,158.40 P306,466.79 P614,399.43 P1,014,024.62 Surcharge (25%) 23,289.60 76,616.70 153,599.86 253,506.15 Deficiency interest: IT (04/15/2010 to 04/30/2014 to 07/31/2016) (P93,158.40 x 20% x 1,476/365 days) 75,343.45 75,343.45 [(P93,158.40 P34,418.40) x 20% x 823/365 days] 26,489.33 26,489.33 VAT (01/25/2010 to 04/30/2014 to 07/31/2016) (P306,466.79 x 20% x 1,556/365 days) 261,294.42 261,294.42 [(P306,466.79 P268,830.24) x 20% x 823/365 days] 16,972.54 16,972.54 EWT (01/15/2010 to 04/30/2014 to 07/31/2016) (P614,399.43 x 20% x 1,566/365 days) 527,205.21 527,205.21 [(P614,399.43 P237,005.83) x 20% x 823/365 days] 170,189.00 170,189.00 Amount due as of July 31, 2016 P218,280.78 P661,350.44 P1,465,393.50 P2,345,024.72 Deficiency interest from 08/01/2016 to 12/31/2017: IT [(P93,158.40 P34,418.40) x 20% x 518/365 days] 16,672.50 16,672.50 VAT [(P306,466.79 P268,830.24) x 20% x 518/365 days] 10,682.59 10,682.59 Deficiency interest on EWT from 08/01/2016 to 01/27/2017: [(P614,399.43 P237,005.82) x 20% x 180/365 days] 37,222.38 37,222.38 Delinquency interest from 08/01/2016 to 12/31/2017: IT [(P218,280.78 P34,418.40 27,817.61 x 20% x 518/365 days] 44,291.06 44,291.06 VAT [(P661,350.44 P268,830.24 P229,205.40) 20% x 518/365 days] 46,354.56 46,354.56 Delinquency interest on EWT from 08/01/2016 to 01/27/2017 [(P1,465,393.50 237,005.83 P231,476.28 x 20% x 180/365 days] 98,325.51 98,325.51 Delinquency interest on EWT from 01/27/2017 to 12/31/2017 [(P1,465,393.50 P237,005.83 P118,022.69 P231,476.28 P183,184.19) x 20% x 180/365 days 128,848.29 128,848.29 Total amount due P279,244.34 P718,387.59 P1,729,789.68 P2,727,421.61 Less: Payments on April 30, 2014 Basic tax 34,418.40 268,830.24 237,005.83 540,254.47 Interest 27,817.61 229,205.40 231,476.28 488,499.29 Less: Payments on January 27, 2017 Basic tax - - 118,022.69 118,022.69 Interest - - 183,184.19 183,184.19 Remaining tax due on December 31, 2017 P217,008.33 P220,351.95 P960,100.69 P1,397,460.97 In addition, petitioner is ORDERED TO PAY delinquency interest at the rate of twelve percent (12%), which is double the legal interest rate for loans or forbearance of any money, on the total unpaid income tax, VAT, and EWT of P156,044.77, P163,314.80, and P996,911.39, respectively, representing basic deficiency tax, surcharge, and deficiency interest until July 31, 2016, net of payments made on April 30, 2014, as shown below, computed from January 1, 2018 until full payment thereof pursuant to Section 249(C) of the 1997 NIRC, as amended by Republic Act No. 10963, also known as Tax Reform for Acceleration and Inclusion (TRAIN) Law, and as implemented by RR No. 21-2018. Income Tax VAT EWT Total Amount due as of July 31, 2016 P218,280.78 P661,350.44 P1,465,393.50 P2,345,024.72 Less: Payments on April 30, 2014 Basic tax 34,418.40 268,830.24 237,005.83 540,254.47 Interest 27,817.61 229,205.40 231,476.28 488,499.29 Total unpaid tax as of July 31, 2016 P156,044.77 P163,314.80 P996,911.39 P1,316,270.96 SO ORDERED . 68 xxx xxx xxx Aggrieved, on 24 September 2019, petitioner filed his Motion for Partial Reconsideration 69 (MPR) on the assailed Decision. Pursuant to the Special Second Division's order, 70 respondent filed its Comment/Opposition 71 to petitioner's MPR on 14 October 2019. Later, respondent filed on 13 November 2019 a Manifestation, 72 informing the Special Second Division that: (1) it opted not to file a motion for reconsideration; and, (2) it has already paid on 30 October 2019 the tax liabilities stated under the assailed Decision but based on its own computation in the total amount of P1,686,102.98 as evidenced by BIR Form No. 0605 73 and the eFPS Payment Details, 74 detailed as follows: IT VAT EWT Total Remaining deficiency tax due on 31 December 2017 P217,008.33 P220,351.95 P960,100.69 P1,397,460.97 Delinquency interest of 12% from 01 January 2018 to 30 October 2019 34,218.69 35,812.92 218,610.38 288,641.99 Total payment P251,227.02 75 P256,164.87 76 P1,178,711.07 77 P1,686,102.96 78 The Special Second Division thereafter noted respondent's Manifestation. 79 In the assailed Resolution dated 02 January 2020, 80 the Special Second Division denied petitioner's MPR, the dispositive portion thereof reads: cSEDTC xxx xxx xxx WHEREFORE ,premises considered, respondent's Motion for Partial Reconsideration (Re: Decision promulgated 6 September 2019) filed on September 24, 2019, is DENIED for lack of merit. SO ORDERED . 81 xxx xxx xxx Undeterred, on 22 January 2020, petitioner filed the present Petition for Review 82 before the Court En Banc docketed as CTA EB No. 2215. In compliance with the Court En Banc 's order, respondent filed on 02 March 2020 its Comment 83 on the present Petition for Review. Pursuant to Section II 84 of A.M. No. 11-1-5-SC-PHILJA or the Interim Guidelines for Implementing Mediation in the Court of Tax Appeals, the Court En Banc referred the case to the Philippine Mediation Center-Court of Tax Appeals (PMC-CTA) for mediation. 85 However, the parties decided not to have their case mediated by the PMC-CTA. 86 On 08 October 2020, the Court En Banc submitted the case for decision. 87 ISSUE Before Us, petitioner raises the lone issue of whether THE SPECIAL SECOND DIVISION ERRED WHEN IT CANCELLED THE DEFICIENCY INCOME TAX (IT) AND VALUE-ADDED TAX (VAT) FOR UNDECLARED SERVICE INCOME, UNDECLARED PURCHASES AND UNACCOUNTED SOURCE OF CASH ON THE GROUND THAT THE SAME IS MERELY BASED ON PRESUMPTION. In support of his petition, petitioner reiterates his argument in his MPR that the Court should only rule on matters that were raised in the administrative level and should be limited only to issues raised therein. Citing once again the ruling in Pilipinas Total Gas, Inc. v. Commissioner of Internal Revenue 88 that a judicial review of the findings of an administrative body such as the BIR is not a de novo trial, petitioner argues that the Court cannot rule on matters that were never substantiated at the said level and should confine itself to the issues raised and the documents submitted in support of respondent's protests filed against the subject assessment. Petitioner further insists that respondent's undeclared service income, undeclared purchases and unaccounted source of cash constitute undeclared revenue which should give rise to deficiency IT and VAT for TY 2009. Conversely, respondent argues that the Special Second Division properly considered its evidence mainly because the CTA is a court of record and thereby authorized to conduct trial de novo .Additionally, as opposed to petitioner's contention, the pieces of evidence submitted to the Special Second Division are the same pieces of evidence submitted to the BIR during the administrative stage of the proceedings. Respondent also points out that the subject deficiency tax assessments based on third-party information are void for being based on mere presumptions and unverified data. While tax assessments are presumed correct and regularly issued, it should not be based on mere presumptions. Thus, failure to validate such third-party information on which the alleged discrepancies were based rendered the assessment void for lack of factual basis. Lastly, respondent no longer disputes the Special Second Division's computation of its deficiency tax liabilities. As mentioned in its 13 November 2019 Manifestation, respondent adds that it has, in fact, fully paid its remaining deficiency tax liabilities under the assailed Decision, including the 12% delinquency interest from 01 January 2018 to the payment date or on 30 October 2019. RULING OF THE COURT EN BANC Before going into the merits of the case, We shall first resolve whether the Court En Banc has jurisdiction over the present petition. SDAaTC THE PETITION FOR REVIEW WAS TIMELY FILED. The Court's Special Second Division issued the assailed Resolution denying petitioner's MPR on 02 January 2020. Petitioner received the said assailed Resolution on 10 January 2020. 89 Under Section 2 (a) (1), 90 Rule 4 in relation to Section 3 (b), 91 Rule 8 of the RRCTA, petitioner had fifteen (15) days from 10 January 2020 or until 25 January 2020 within which to file an appeal before this Court. Accordingly, petitioner filed the present petition on time on 22 January 2020. NO COMPELLING GROUND TO REVERSE OR MODIFY THE ASSAILED DECISION AND RESOLUTION. This Court finds that the present Petition for Review is a mere rehash of the issue already presented, duly resolved and passed upon by the Special Second Division in their 02 January 2020 Resolution. It is worth mentioning that petitioner's discussion in this petition is almost a word for word replication of his discussion in his MPR as he merely replaced the word "respondent" with "petitioner." Regrettably, petitioner did not make any attempt to make a reference to the Special Second Division's discussion of the legal basis and relevant jurisprudence used to arrive at the conclusion in the assailed Resolution. There being no new matters or issues raised in the present Petition for Review and there being no reversible error committed by the Special Second Division, the Court En Banc finds no cogent reason to deviate from the assailed Decision and Resolution. Nevertheless, for emphasis, the Court En Banc shall pass upon petitioner's arguments. (1) THE COURT OF TAX APPEALS IS AUTHORIZED TO CONDUCT TRIAL DE NOVO . We find no merit in petitioner's contention that the Special Second Division erred in allowing respondent to present evidence which were not introduced in the administrative level as this goes against the nature of the Court as a "court of record" pursuant to Section 8 92 of Republic Act (RA) No. 1125, 93 as amended by RA 9282. 94 As a "court of record," the CTA is authorized to conduct trial de novo ,and consistent with this principle, parties who come to court are required to prove every aspect of their case if they want the Court to take such evidence into consideration. 95 Accordingly, the Special Second Division properly considered the pieces of evidence formally offered by respondent. (2) TAX ASSESSMENTS CANNOT BE BASED ON MERE PRESUMPTIONS AND UNVERIFIED DATA. We likewise agree with the Special Second Division's cancellation of the deficiency tax assessments derived from discrepancies found using unverified third-party information gathered through the BIR's Reconciliation of Listing for Enforcement (RELIEF) system. In line with the implementation of the RELIEF system, the pertinent portions of Revenue Memorandum Order (RMO) Nos. 04-2003 96 and 46-2004 97 state: xxx xxx xxx I. BACKGROUND The Bureau of Internal Revenue is reengineering its work processes in order to increase revenue collections and to pursue quality audit by making use of available internal and external information resources. In order to strengthen and enhance its assessment functions, the utilization of information technology has been identified as an effective tool to improve tax administration through the development of the Reconciliation of Listings for Enforcement (RELIEF) System. acEHCD The RELIEF System was created to support third party information program and voluntary assessment program of the Bureau through the cross-referencing of third party information from the taxpayers' Summary Lists of Sales and Purchases prescribed to be submitted on a quarterly basis pursuant to Revenue Regulations Nos. 7-95, as amended by RR 13-97, RR 7-99 and RR 8-2002. The RELIEF System shall cover all VAT taxpayers above threshold limits set by RR 8-2002 to submit Summary Lists of Sales and Purchases in magnetic form based on a prescribed electronic format. The consolidation and matching of information with other externally sourced data will detect underdeclaration of revenues/overdeclaration of cost and expenses, thus resulting to greater tax potential . xxx xxx xxx III. PROCEDURES xxx xxx xxx Action on Protested LNs due to TPI discrepancy The Revenue Officer assigned to handle the Letter Notice shall : 1. Evaluate the merits of the taxpayer's Protest by: 1.1 Requiring the taxpayer to submit the necessary schedules and supporting documents to substantiate his claims. 1.2 Reconciling the Schedule of Sales/Local Purchases submitted by the taxpayer against the Details of Taxpayer's Customers/Suppliers' Records (DTCS) culled from the Quarterly Summary List of Sales/Purchases submitted by taxpayer's suppliers and customers, respectively. 1.3 Reconciling the Schedule of Importation submitted by the taxpayer against the Details of Importation with Return Information Matching (DIRIM) culled from data provided by the Bureau of Customs (BOC). 1.4 Checking for the propriety of the transactions reflected in the schedules submitted by the taxpayer by validating against source documents ( e.g. ,sales invoice, official receipts, import entry declarations, etc.). 2. Require the taxpayer to execute a Sworn Statement (Annex A) attesting to the veracity of the schedules and authenticity of the documents presented/submitted. 3. Obtain Sworn Statements from TPI sources (Annexes "B" and "C") attesting to the veracity of the data provided. 3.1 If the TPI source is registered in the RDO/LTDO/LTAID having jurisdiction over the subject taxpayer, the RO shall: 3.1.1 Prepare "Confirmation Requests" (using the format prescribed in Annex "C" of RMO No. 30-2003 to be signed by the heads of the concerned RDO/LTDO/LTAID) for purposes of verifying the accuracy of the figures appearing in the DTCS 3.1.2 If the TPI source agrees with the figures in the "Confirmation Requests" (CR),secure a Sworn Statement from the TPI source to allow the RO to build a case against the taxpayer. 3.2 If the TPI source is outside the jurisdiction of the RDO/LTDO/LTAID where the taxpayer is registered, the RO shall: 3.2.1 Coordinate with the RDO/LTDO/LTAID where the TPI source is registered, in order to: HSAcaE a. Prepare a CR to be transmitted and signed by the RDO/LTDO/LTAID having jurisdiction over TPI source (CRs should be coursed thru the RDO/LTDO/LTAID where the taxpayer is registered); b. Secure a sworn statement from the TPI source thru the RDO/LTDO/LTAID having jurisdiction over the same; and, c. Assist the heads of the concerned RDO/LTDO/LTAID in the preparation of Monthly Status Report on Confirmation Requests Transmitted (Annex "D") outside the RDO/LTDO/LTAID of the TPI source and submit the same to the SCG, for monitoring purposes. xxx xxx xxx While the foregoing RMOs do not explicitly state that unverified third-party information renders the assessment void, abovementioned provisions confirm that the BIR is required to verify the amounts it obtained from its computerized/third-party matching by securing a confirmation or verification from the third-party information source, or from externally sourced data. Without conducting such confirmation or verification, the data gathered from the computerized/third party matching are left unsubstantiated, and the resulting assessment is void for lack of factual and legal basis. 98 In Commissioner of Internal Revenue v. Hantex Trading Co., Inc. , 99 the Supreme Court has ruled that, in order for an assessment to stand judicial scrutiny, it must be based on facts supported by credible evidence. We quote the relevant portions of the said case: xxx xxx xxx We agree with the contention of the petitioner that, as a general rule, tax assessments by tax examiners are presumed correct and made in good faith. All presumptions are in favor of the correctness of a tax assessment. It is to be presumed, however, that such assessment was based on sufficient evidence. Upon the introduction of the assessment in evidence, a prima facie case of liability on the part of the taxpayer is made. If a taxpayer files a petition for review in the CTA and assails the assessment, the prima facie presumption is that the assessment made by the BIR is correct, and that in preparing the same, the BIR personnel regularly performed their duties. This rule for tax initiated suits is premised on several factors other than the normal evidentiary rule imposing proof obligation on the petitioner-taxpayer: the presumption of administrative regularity; the likelihood that the taxpayer will have access to the relevant information; and the desirability of bolstering the record-keeping requirements of the NIRC. However, the prima facie correctness of a tax assessment does not apply upon proof that an assessment is utterly without foundation, meaning it is arbitrary and capricious. Where the BIR has come out with a "naked assessment," i.e. ,without any foundation character, the determination of the tax due is without rational basis. In such a situation, the U.S. Court of Appeals ruled that the determination of the Commissioner contained in a deficiency notice disappears. Hence, the determination by the CTA must rest on all the evidence introduced and its ultimate determination must find support in credible evidence . xxx xxx xxx Thus, the computations of the EIIB and the BIR on the quantity and costs of the importations of the respondent in the amount of P105,761,527.00 for 1987 have no factual basis, hence, arbitrary and capricious. The petitioner cannot rely on the presumption that she and the other employees of the BIR had regularly performed their duties. As the Court held in Collector of Internal Revenue v. Benipayo ,in order to stand judicial scrutiny, the assessment must be based on facts. The presumption of the correctness of an assessment, being a mere presumption, cannot be made to rest on another presumption . HESIcT xxx xxx xxx In this case, as correctly found by the Special Second Division, the records disclose that the BIR derived the subject deficiency tax assessments (corresponding to the alleged undeclared service income, undeclared purchases and unaccounted source of cash) only from the discrepancies found in the working papers summarizing the comparison between respondent's Summary List of Sales (SLS) and Summary List of Purchases (SLP) vis--vis third-party SLS and SLP. It is undisputed that petitioner failed to verify the amounts reflected in the third-party SLS and SLP with the relevant customers and suppliers. Thus, the same casts doubts as to the reliability and correctness of the findings of deficiency taxes assessed by petitioner. While it is axiomatic that all presumptions are in favor of the correctness of tax assessments, the assessment itself should not be based on presumptions no matter how logical the presumption might be. In order to stand the test of judicial scrutiny, the assessment must be based on actual facts. The presumption of the correctness of an assessment, being a mere presumption, cannot be made to rest on another presumption. 100 For lack of factual and legal basis, the deficiency tax assessments corresponding to the alleged undeclared service income, undeclared purchases and unaccounted source of cash should then be cancelled. On a final note. An examination of the records confirms that respondent has already paid in full the remaining deficiency tax due on 31 December 2017 amounting to P1,397,460.97 and the 12% delinquency interest of P288,641.99 (computed from 01 January 2018 until full payment on 30 October 2019),in accordance with the assailed Decision. Thus, upon the finality of this decision, respondent has no more deficiency tax liability for TY 2009. WHEREFORE ,premises considered, the present Petition for Review filed on 22 January 2020 by petitioner Commissioner of Internal Revenue, is hereby DENIED for lack of merit. Accordingly, the assailed Decision dated 06 September 2019 and Resolution dated 02 January 2020 of the Court's Special Second Division in CTA Case No. 9531, entitled Mercury Group of Companies, Inc. v. Commissioner of Internal Revenue ,are hereby AFFIRMED . Consequently, petitioner or any person duly acting on his behalf is hereby ENJOINED from proceeding with the collection of additional deficiency taxes arising from the Final Decision on Disputed Assessment dated 04 January 2017 for taxable year 2009. SO ORDERED. (SGD.) JEAN MARIE A. BACORRO-VILLENA Associate Justice Roman G. del Rosario, P.J.,Juanito C. Castaeda, Jr.,Erlinda P. Uy, Ma. Belen M. Ringpis-Liban, Catherine T. Manahan and Maria Rowena Modesto-San Pedro, JJ. ,concur. Footnotes 1. Filed on 22 January 2020, Rollo, pp. 1-91, with annexes. 2. SEC. 3. Who may appeal; period to file petition . xxx xxx xxx (b) A party adversely affected by a decision or resolution of a Division of the Court on a motion for reconsideration or new trial may appeal to the Court by filing before it a petition for review within fifteen days from receipt of a copy of the questioned decision or resolution. Upon proper motion and the payment of the full amount of the docket and other lawful fees and deposit for costs before the expiration of the reglementary period herein fixed, the Court may grant an additional period not exceeding fifteen days from the expiration of the original period within which to file the petition for review. 3. Division Docket, Volume III, pp. 1258-1321; Penned by Hon. Associate Justice Catherine T. Manahan with Hon. Associate Justice Juanito C. Castaeda, Jr. concurring. 4. Id. ,pp. 1369-1375. 5. The Second Division was reconstituted after the passage of CTA Administrative Circular No. 02-18 dated 18 September 2018 entitled "Reorganizing the Three (3) Divisions of the Court." 6. Exhibits "P-1" and "P-2",Division Docket, Volume III, pp. 1041-1073. 7. Exhibit "P-3", id. ,Volume II, p. 529. 8. Exhibit "R-1",BIR Records, p. 1. 9. Exhibit "R-11", id. ,p. 717. 10. Exhibit "R-12", id. ,p. 718. 11. Exhibit "R-13", id. ,p. 719. 12. Annex "P" attached to the original Petition for Review, Division Docket, Volume I, p. 146. 13. Exhibit "P-47", id. ,Volume II, p. 736. 14. Exhibit "P-48", id. ,pp. 737-740. 15. Exhibit "P-48-a", id. ,pp. 741-744. 16. Exhibit "P-49", id. ,pp. 745-748. 17. Exhibit "P-49-a", id. ,pp. 749-752. 18. Annex "Q" attached to the original Petition for Review, id. ,Volume I, pp. 155-161. 19. Exhibit "P-50", id. ,Volume II, p. 753. 20. Exhibit "P-51", id. ,p. 786. 21. Exhibit "P-53", id. ,p. 886. 22. Exhibit "P-52", id. ,p. 857. 23. Exhibit "P-52-a" to "P-52-u", id. ,pp. 858-885. 24. Annex "V" attached to the original Petition for Review, id. ,Volume I, pp. 295-347. 25. Exhibits "P-54" and "P-54-a", id. ,Volume II, pp. 887-896. 26. Exhibits "P-56-a" to "P-56-c", id. ,pp. 923-925. 27. Id. ,Volume I, pp. 10-376, with annexes. 28. Supra at note 22. 29. Minimal difference of P0.01. 30. Minimal difference of P0.01. 31. Division Docket, Volume I, pp. 384-401. 32. Id. ,pp. 425-440. 33. Id. ,pp. 402-403. 34. Id. ,pp. 410-415. 35. Id. ,pp. 454-461. 36. Id. ,pp. 416-420. 37. Id. ,pp. 404-408. 38. Id. ,p. 409. 39. Minutes of the Hearing dated 16 March 2017, id. ,p. 423. 40. See Order dated 16 March 2017, id. ,p. 424. 41. Id. ,Volume II, pp. 464-471. 42. Id. ,pp. 474-480. 43. Id. ,pp. 485-487. 44. Id. ,Volume III, p. 933. 45. Minutes of the Hearing dated 24 July 2017 and Order dated 24 July 2017, id. ,pp. 987-988. 46. Id. ,pp. 992-1040. 47. Id. ,pp. 1094-1096. 48. Monthly Remittance Return of Income Taxes Withheld on Compensation (BIR Form No. 1601C) for the month of January 2009, with eFPS Filing Reference No. 010900002763742 filed on 11 February 2009. 49. eFPS Payment Details for Filing Reference No. 010900002872627 in the amount of P1,243,474.84 with Acknowledgment Receipt No. ELY04082009000198573. 50. Exhibit No. Description "P-50-i" Reconciliation of BIR Findings for the Year 2009, Page 2, Annex C-2 attached to Protest "P-51-j-31" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 01/01/09 to 03/31/09 with MGCI as Payee and Mercury Drug Corporation as Payor with a total income payment of [P]10,242,195.59 and total creditable tax withheld of [P]1,536,329.34. "P-51-j-32" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 07/01/09 to 09/30/09 with MGCI as Payee and Mercury Drug Corporation as Payor with a total income payment of [P]13,919,307.47 and total creditable tax withheld of [P]2,087,896.12. "P-51-j-33" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 04/01/09 to 06/30/09 with MGCI as Payee and Mercury Drug Corporation as Payor with a total income payment of [P]13,616,602.80 and total creditable tax withheld of [P]2,042,490.42. "P-51-j-34" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 10/01/09 to 12/31/09 with MGCI as Payee and Mercury Drug Corporation as Payor with a total income payment of PhP16,694,079.46 and total creditable tax withheld of [P]2,504,111.92. "P-51-j-36" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of [01/01/09 to 03/31/09] with MGCI as Payee and Trinity Franchising & Mngt. Corp. as Payor with a total income payment of PhP2,982,900.00 and total creditable tax withheld of [P]447,435.00. "P-51-j-37" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of [04/01/09 to 06/30/09] with MGCI as Payee and Trinity Franchising & Mngt. Corp. as Payor with a total income payment of PhP3,725,100.00 and total creditable tax withheld of [P]558,765.00. "P-51-j-38" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 10/01/09 to 12/31/09 with MGCI as Payee and Trinity Franchising & Mngt. Corp. as Payor with a total income payment of PhP3,354,000.00 and total creditable tax withheld of [P]503,100.00. "P-51-j-39" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 01/01/08 to 12/31/08 with Mercury Group of Insurance as Payee and Malayan Insurance Co.,Inc. as Payor with a total income payment of PhP1,035,463.93 and total creditable tax withheld of [P]155,319.59. "P-51-j-40" Official Receipt No. 48772 dated January 7, 2009 issued by MGCI to Malayan Insurance Co.,Inc. in the sum of [P]784,859.95. "P-51-j-41" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 01/01/09 to 03/31/09 with Mercury Group Insurance Agency as Payee and Federal Phoenix Assurance Co.,Inc. as Payor with a total income payment of PhP1,718,693.33 and total creditable tax withheld of [P]217,661.19. "P-51-j-42" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 04/01/09 to 06/30/09 with Mercury Group Insurance Agency as Payee and Federal Phoenix Assurance Co.,Inc. as Payor with a total income payment of PhP18,237,018.50 and total creditable tax withheld of [P]1,991,515.36. "P-51-j-43" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 07/01/09 to 09/30/09 with Mercury Group Insurance Agency as Payee and Federal Phoenix Assurance Co.,Inc. as Payor with a total income payment of PhP3,848,628.50 and total creditable tax withheld of [P]384,862.85. "P-51-j-44" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 10/01/09 to 12/31/09 with Mercury Group Insurance Agency as Payee and Federal Phoenix Assurance Co.,Inc. as Payor with a total income payment of PhP3,153,553.53 and total creditable tax withheld of [P]325,797.84. "P-51-j-45" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 10/01/09 to 12/31/09 with Mercury Group Insurance Agency as Payee and Fortune Medicare, Inc. as Payor with a total income payment of PhP2,365,368.56 and total creditable tax withheld of [P]236,536.86. "P-51-j-46" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 12/01/09 to 12/31/09 with MGCI as Payee and Medical Center Trading Corporation as Payor with a total income payment of PhP1,306,000.00 and total creditable tax withheld of [P]195,900.00. "P-51-j-47" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 11/01/09 to 11/30/09 with MGCI as Payee and Medical Center Trading Corporation as Payor with a total income payment of PhP1,306,000,00 and total creditable tax withheld of [P]195,900.00. "P-51-j-48" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 10/01/09 to 10/31/09 with MGCI as Payee and Medical Center Trading Corporation as Payor with a total income payment of PhP1,306,000.00 and total creditable tax withheld of [P]195,900.00. "P-51-j-49" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 09/01/09 to 09/30/09 with MGCI as Payee and Medical Center Trading Corporation as Payor with a total income payment of PhP1,306,000.00 and total creditable tax withheld of [P]195,900.00. "P-51-j-50" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 08/01/09 to 08/31/09 with MGCI as Payee and Medical Center Trading Corporation as Payor with a total income payment of PhP1,306,000.00 and total creditable tax withheld of [P]195,900.00 "P-51-j-51" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 07/01/09 to 07/31/09 with MGCI as Payee and Medical Center Trading Corporation as Payor with a total income payment of PhP1,306,000.00 and total creditable tax withheld of [P]195,900.00. "P-51-j-52" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 06/01/09 to 06/30/09 with MGCI as Payee and Medical Center Trading Corporation as Payor with a total income payment of PhP1,306,000.00 and total creditable tax withheld of [P]195,900.00. "P-51-j-53" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 05/01/09 to 05/31/09 with MGCI as Payee and Medical Center Trading Corporation as Payor with a total income payment of PhP1,306,000.00 and total creditable tax withheld of [P]195,900.00. "P-51-j-54" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 04/01/09 to 04/30/09 with MGCI as Payee and Medical Center Trading Corporation as Payor with a total income payment of PhP1,578,400.00 and total creditable tax withheld of [P]236,760.00. "P-51-j-55" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 03/01/09 to 03/31/09 with MGCI as Payee and Medical Center Trading Corporation as Payor with a total income payment of PhP1,215,200.00 and total creditable tax withheld of [P]182,280.00. "P-51-j-56" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 02/01/09 to 02/28/09 with MGCI as Payee and Medical Center Trading Corporation as Payor with a total income payment of PhP1,215,200.00 and total creditable tax withheld of [P]182,280.00. "P-51-j-57" Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) issued for the period of 01/01/09 to 01/31/09 with MGCI as Payee and Medical Center Trading Corporation as Payor with a total income payment of PhP1,215,200.00 and total creditable tax withheld of [P]182,280.00. "P-52" Letter dated June 3, 2014, consisting of one (1) page. "P-55-c" Annex B-1 attached to Motion for Reconsideration dated January 16, 2017 "P-55-d" Annex B-2 attached to Motion for Reconsideration dated January 16, 2017 "P-59" Deed of Absolute Assignment notarized November 13, 2007 between Carmen O. Garcia and MGCI 51. Income Statement with Schedule of Operating Expenses for the period ended 31 December 2009, which was offered to prove that no income attributable to the cost-sharing scheme of respondent's Trinity and Insurance Divisions. 52. Minutes of the Hearing dated 20 September 2017, Division Docket, Volume III, p. 1097. 53. Id. ,pp. 1112-1118. 54. Id. ,pp. 1104-1109. 55. Id. ,pp. 1120-1122. 56. See Resolution, id. ,pp. 1156-1159. 57. Supra at note 51. 58. Deed of Absolute Assignment notarized November 13, 2007 between Carmen O. Garcia and MGCI. 59. Division Docket, Volume III, pp. 1160-1178. 60. Id. ,pp. 1182-1230. 61. Id. ,pp. 1232-1234. 62. Supra at note 59. 63. Supra at note 60. 64. Division Docket, Volume III, pp. 1235-1249. 65. See Resolution dated 07 September 2018, id. ,p. 1251. 66. Supra at note 3. 67. Supra at note 5. 68. Citation omitted; Emphasis and italics in the original text. 69. Division Docket, Volume III, pp. 1322-1334. 70. See Resolution dated 26 September 2019, id. ,p. 1336. 71. Id. ,pp. 1337-1350. 72. Id. ,pp. 1354-1367. 72. Annexes "A","B" and "C" attached to the Manifestation dated 13 November 2019, id. ,pp. 1359, 1362 and 1365. 73. Annexes "A-1","A-2","B-1","B-2","C-1" and "C-2" attached to the Manifestation dated 13 November 2019, id. ,pp. 1360-1361, 1363-1364, and 1366-1367. 74. Minimal difference of P0.01 (P251,227.03 per BIR Form No. 0605 and eFPS Payment Details). 76. Minimal difference of P0.02 (P256,164.89 per BIR Form No. 0605 and eFPS Payment Details). 77. Minimal difference of P0.01 (P1,178,711.06 per BIR Form No. 0605 and eFPS Payment Details). 78. Minimal difference of P0.02. 79. See Resolution dated 02 December 2019, Division Docket, Volume III, pp. 1352-1353. 80. Supra at note 4. 81. Emphasis and italics in the original text. 82. Supra at note 1. 83. Rollo ,Volume I, pp. 95-494, with annexes. 84. II. REFERRAL TO MEDIATION The referral to mediation shall be made after the filing of the Comment in cases pending with the Court En Banc and, before or during the pre-trial for cases pending with the Special Second Division. xxx xxx xxx A Resolution (FORM NO. 1) shall be issued by the Court En Banc or in Division, referring the covered civil case to mediation and requiring the parties to appear before the Philippine Mediation Center-Court of Tax Appeals (PMC-CTA) at a specified date and time. Said Resolution shall suspend the proceedings for the duration of the period of mediation stated in Section VIII below. 85. See Resolution dated 15 July 2020, Rollo ,pp. 496-497. 86. See No Agreement to Mediate dated 01 September 2020, id. ,p. 498. 87. See Resolution, id. ,pp. 500-501. 88. G.R. No. 207112, 08 December 2015. 89. See Notice of Resolution dated 02 January 2020, Division Docket, Volume III, p. 1368. 90. SEC. 2. Cases Within the Jurisdiction of the Court En Banc . The Court en banc shall exercise exclusive appellate jurisdiction to review by appeal the following: (a) Decisions or resolutions on motions for reconsideration or new trial of the Special Second Divisions in the exercise of its exclusive appellate jurisdiction over: (1) Cases arising from administrative agencies Bureau of Internal Revenue ,Bureau of Customs, Department of Finance, Department of Trade and Industry, Department of Agriculture[.] (Emphasis supplied.) 91. Supra at note 2. 92. Sec. 8. Court of record; seal; proceedings . The Court of Tax Appeals shall be a court of record and shall have a seal which shall be judicially noticed. It shall prescribe the form of its writs and other processes. It shall have the power to promulgate rules and regulations for the conduct of the business of the Court, and as may be needful for the uniformity of decisions within its jurisdiction as conferred by law, but such proceedings shall not be governed strictly by technical rules of evidence. (Emphasis supplied.) 93. AN ACT CREATING THE COURT OF TAX APPEALS. 94. AN ACT EXPANDING THE JURISDICTION OF THE COURT OF TAX APPEALS (CTA), ELEVATING ITS RANK TO THE LEVEL OF A COLLEGIATE COURT WITH SPECIAL JURISDICTION AND ENLARGING ITS MEMBERSHIP, AMENDING FOR THE PURPOSE CERTAIN SECTIONS OF REPUBLIC ACT NO. 1125, AS AMENDED, OTHERWISE KNOWN AS THE LAW CREATING THE COURT OF TAX APPEALS, AND FOR OTHER PURPOSES. 95. Philippine Airlines, Inc. (PAL) v. Commissioner of Internal Revenue ,G.R. Nos. 206079-80, 17 January 2018; Commissioner of Internal Revenue v. Philippine National Bank ,G.R. No. 180290, 29 September 2014; Commissioner of Internal Revenue v. Manila Mining Corporation ,G.R. No. 153204, 31 August 2005. 96. Guidelines and Procedures on the Processing of Quarterly Summary Lists of Sales and Purchases and of the Imposition of Penalties Therefor as Provided under Revenue Regulations No. 8-2002 ;Emphasis and underscoring supplied. 97. Additional Supplement and Guidelines in Handling Letter Notices with Discrepancies Arising from Data Matching Processes as defined in Revenue Memorandum Order (RMO) Nos. 34-2004 and 30-2003, as amended by RMO Nos. 42-2003 and 24-2004, which remain Unserved, have been Served but are Without Response, or are Under Protest by Taxpayers ;Emphasis and underscoring supplied. 98. Commissioner of Internal Revenue v. MCC Transport Singapore Pte. Ltd. , CTA EB No. 1961 (CTA Case No. 9045), 14 July 2020. 99. G.R. No. 136975, 31 March 2005; Citations omitted, italics in the original text, emphasis and underscoring supplied. 100. The Collector of Internal Revenue (now Commissioner) v. Benipayo ,G.R. No. L-13656, 31 January 1962.