Procedural Guidelines on Functions of the Appellate Conference Staff

March 24, 1981 REVENUE ADMINISTRATIVE ORDER NO. 03-81 SUBJECT : Procedural Guidelines on Functions of the Appellate Conference Staff TO : All Internal Revenue Officers and Others Concerned Functions of the Appellate Conference Staff Pursuant to Revenue Administrative Order No. 2-80 dated October 2, 1980, the functions of the Appellate Conference Staff are as follows: Formulate policies and procedures for processing protests against all internal revenue assessments; receive, evaluate and deliberate on requests for reconsideration of deficiency assessments involving P500,000 and above; recommend after study and/or hearing the taxpayer's or his representative's appeal and the examiner's or his superior's arguments, the reinvestigation or referral of the contested or disputed assessment to the proper department or office for appropriate action in line with its recommendations; review for the Commissioner proposed decisions on contested cases. (Including requests for refunds) involving assessments of P500,000 and above. To avoid overlapping of functions and maintain a uniform standard of action on contested tax cases and claims for refunds or tax credits involving P500,000 or above referred to the Appellate Conference Staff, the following rules and procedures are hereby promulgated: acd I . DISPUTED ASSESSMENTS A. In General . Subject to the continuing general supervision of the Revenue Service Chief, Legal Office: 1. If a taxpayer disagrees with the assessment of any tax covered by the National Internal Revenue Code, or any other tax laws or regulations administered and enforced by the Bureau of Internal Revenue, or requests for reconsideration of deficiency assessments involving P500,000 and above, the Revenue Service Chief (Legal Office) may refer the case to the Appellate Conference Staff provided the taxpayer complies with the following: a) The taxpayer shall specify in writing his objection or objections thereto and the basis thereof, item by item, if possible. b) The taxpayer shall execute a waiver of the statute of limitations upon assessment and collection of taxes prescribed by the National Internal Revenue Code and other tax laws administered by the Bureau of Internal Revenue. 2. As soon as a taxpayer has complied with the aforestated requirements, his case shall be set for formal hearing before the Appellate Conference Staff where he may appear either in person or with the assistance of counsel or certified public accountant. During the hearing, he shall be allowed to argue his case and also present evidence, testimonial or documentary. In the presentation of oral evidence, the taxpayer and the witnesses he will present shall be required to testify under oath and may be cross-examined by the members of the Staff. Reception of evidence may be made by the Staff individually or en banc. Cases involving more than P500,000 but less than P1,000,000 may be heard by individual staff members and cases involving more than P1,000,000 shall always be heard en banc . 3. The taxpayer or his attorney and/or accountant if he so desires, shall be allowed to examine the dockets, particularly the worksheets, and other papers submitted by the fieldmen who investigated the case. The lawyer, accountant, or representative of the taxpayer may be authorized to examine the whole docket upon written request made by the taxpayer. The privilege herein granted shall not preclude the Appellate Conference Staff or any of its members from withholding information or papers which, through adroit means, may be tampered with or lost. 4. In the case of documentary evidence, the documentary shall first be identified, before being accepted by the Staff. 5. The hearing before the Appellate Conference Staff shall be terminated after the formal presentation of all the evidence of the taxpayer, testimonial and/or documentary. For the convenience of the members of the Appellate Conference Staff and the taxpayer, the latter or his counsel shall be allowed to submit his memorandum in support of his side of the case, preferably within fifteen (15) days after the termination of the formal hearing, which period may be extended in meritorious cases. 6. As soon as the memorandum of the taxpayer's counsel or certified public accountant is received, or if he fails to do so within the period allowed, the case shall be assigned to a member of the Staff for the preparation of the memorandum-decision for the approval or disapproval of the Commissioner of Internal Revenue. 7. The memorandum-decision for the Commissioner of Internal Revenue shall be submitted to the other members of the Staff for either concurrence or dissent. In the latter case, the member dissenting shall prepare his dissenting opinion in the form of a memorandum for the Commissioner of Internal Revenue. The memorandum containing the findings and recommendation of the Appellate Conference Staff as well as the dissenting opinion, if any, is then forwarded to the Commissioner of Internal Revenue, through the Revenue Service Chief (Legal Office) and the Deputy Commissioner of Internal Revenue, for approval or disapproval. If approved, it becomes the decision of the Bureau in that particular case. 8. If the proposed decision does not meet with the approval of the Revenue Service Chief (Legal Office) or the Deputy Commissioner, or is disapproved by the Commissioner of Internal Revenue, the case shall be returned to the Appellate Conference Staff for further study and compliance with the instructions of higher authority. cd i 9. Upon approval by the Commissioner of Internal Revenue of the memorandum-decision, the docket shall be returned to the Division of origin, through the Service Chief, for appropriate action. B. The Commissioner or the Deputy Commissioner may refer to the Appellate Conference Staff proposed decisions on contested tax cases involving assessments of P500,000 and above. The operating procedures enumerated above shall also be observed. II . CLAIMS FOR REFUNDS AND TAX CREDITS At the instance of the Revenue Service Chief (Legal Office), the Appellate Conference Staff may take cognizance of claims for refunds and tax credits involving the sums of more than P500,000 filed with the Appellate Division. aisa dc 1. After the filing of a claim for refund or tax credit by a taxpayer under Sections 292 and 295 of the Tax Code, the same shall be processed by the Appellate Division. 2. After the claim for refund or tax credit has been duly processed by the Appellate Division, such claims shall be forwarded to the Legal Office for corresponding action. 3. If the Legal Office finds that the action taken on a claim should be reviewed, the case shall be referred to the Appellate Conference Staff. 4. After review, by the Appellate Conference Staff, the same shall be returned to the Legal Office for its decision. 5. Claims referred to the Appellate Conference Staff shall be assigned to one member, unless a hearing is necessary, in which case, it shall be heard and decided en banc. The Commissioner or the Deputy Commissioners may also refer to the Appellate Conference Staff claims for refund in which case the same procedure enumerated above shall be observed. These guidelines take effect upon approval. RUBEN B. ANCHETA Acting Commissioner of Internal Revenue