Solid Cement Corp. v. Court of Tax Appeals

SIXTH DIVISION [CA-G.R. SP No. 33516. February 28, 1995.] (CTA Case No. 4850) SOLID CEMENT CORPORATION , petitioner , vs . COURT OF TAX APPEALS and JOSE ONG, in his capacity as Commissioner of Internal Revenue , respondents . D E C I S I O N RAMIREZ , J p : On January 15, 1992, petitioner Solid Cement Corporation received Bureau of Internal Revenue Income Tax Assessment Notice bearing No. FAS-4-88-91-003447 for deficiency value-added tax for the year 1988 in the amount of P3,097,149.48, inclusive of surcharge, interest and compromise penalty (Annex C, petition). On February 2, 1992, petitioner wrote to the respondent Commissioner "contesting the disallowance of input taxes on adjustment of quality coal billed to us by PNOC Coal Corporation," and requesting reinvestigation of the matter to enable it to present proof to validate its claim for input taxes on coal adjustments (Annex D, petitioner). On August 18, 1992, petitioner received a letter signed by the Chief, Accounts Receivable/Billing Division of the Bureau of Internal Revenue, for respondent Commissioner, calling attention to the deficiency value added tax of P3,097,149.43 in Income Tax Assessment Notice No. FAS-4-88-91-003447 that has remained unpaid and requesting that it be paid within ten days from notice, otherwise the matter would be referred "to the Collection Enforcement Division for the issuance of a warrant of distraint and levy to enforce its collection, without Further notice" (Annex E, petitioner). On September 17, 1992, petitioner filed in the Court of Tax appeals a petition for review of the assessment for alleged deficiency value added tax for the year 1988 in the amount of P3,097,149.48 which as stated in the letter (Annex E, petition), should be paid within ten days from notice (Annex F, petition). In his answer to the petition dated November 25, 1992, respondent Commissioner alleged, among others, that the letter dated August 4, 1992 (Annex E, petition) did not constitute his "final decision on the petitioner's letter-protest dated February 10, 1992 appealable" to the Court of Tax Appeals, hence the petition for review filed was premature and conferred no jurisdiction for it to take cognizance of the case (Annex G, petition). On July 2, 1993, at the hearing before the respondent Court, respondent Commissioner pressing the issue of prematurity of the petition for review moved in open court to dismiss the case, whereupon petitioner prayed that it be granted time to file its opposition, which was granted. On July 26, 1993, petitioner filed in the respondent Court its opposition to respondent Commissioner's motion to dismiss (Annex H, petitioner). On September 10, 1993, the respondent Court granted respondent Commissioner's motion to dismiss (Annex B, petition). Petitioner's motion for reconsideration of the FOREGOING order of the respondent Court having been denied (Annex A, petition), the instant petition for review was filed in this Court. There is no merit in the instant petition for review. In dismissing the petition before it, the Court of Tax Appeals said: In his Opposition To Dismissal of Petition Due To Its Alleged Prematurity filed on July 26, 1993, petitioner maintained that respondent's letter dated August 4, 1992 (Annex C.) constituted already a final decision on petitioner's letter-protest of February 10, 1992 because according to the petitioner, its protest had been denied in whole when the collection letter specifically stated: To avoid the accumulation of interest and surcharges, it is requested that you pay within ten (10) days from receipt hereof the aforesaid tax liability/ies . . . failing in that, we shall be constrained to refer your case to the Collection Enforcement Division for the issuance of a warrant of distraint and levy to enforce its collection, without further notice . (Emphasis supplied by petitioner; CTA Records p. 33) We do not agree. We do not see anything in the above quoted letter which would clearly and unmistakably indicate the denial with finality by the respondent on disputed assessments which is appealable to this Court as contemplated by Section 7 of Republic Act 1125. Even the phrase "failing in that, (meaning failure to pay within ten (10) days), we shall be constrained to refer your case to the Collection Enforcement Division for the issuance of the warrant of distraint and levy to enforce collection without further notice" cannot by any stretch of imagination be considered as "final" decision of the respondent. In fact, even the actual issuance of warrant of distraint and levy is, under certain circumstances, still cannot be considered as final decision of the respondent Commissioner of Internal Revenue on disputed assessment (Commissioner of Internal Revenue vs. Union Shipping Corp. 185 SCRA 547) (Annex B, petition). In the face of respondent Commissioner's special and affirmative defense set up in his answer filed in the respondent Court, that Respondent's letter dated August 4, 1992 (Annex "C") requesting petitioner to pay within ten (10) days from receipt thereof of the deficiency value-added-tax in the total amount of P3, 097,149.48 for the year 1988 does not constitute respondent's final decision on the petitioner's letter-protest dated February 10, 1992 appealable to this Honorable Court, hence, the petition is premature and confers no jurisdiction to this Honorable Court (Annex G, petition) reiterated in his comment to the petitioner filed in this Court, petitioner has no valid reason to complain against respondent Commissioner in that regard. His remedy is to await the final decision on the matter. Only then that petitioner can file the appropriate petition in the Court of Tax appeals, if the respondent Commissioner's final decision is adverse to him. WHEREFORE, the instant petition for review is DISMISSED. Costs against petitioner. SO ORDERED. Abad Santos , Jr . and Labitoria , JJ ., concur.