COMMISSIONER VS. CA, R.O.H.

AUTO PRODUCTS
G.R. No. 108358
January 20, 1995

FACTS:
On 22 August 1986, Executive Order 41 was promulgated declaring a one-time tax
amnesty on unpaid income taxes, later amended to include estate and donor’s taxes and taxes
on business for the taxable years 1981 to 19985. Availing itself of the amnesty, ROH Autoparts
Philippines Inc. filed its Tax Amnesty Return and paid the corresponding amnesty taxes due. The
Company requested that the deficiency tax notice (13 August 1986) be cancelled and withdrawn
as it has availed of the tax amnesty. The Commissioner denied the request, construing that the
amnesty coverage include only assessments issued by the BIR after the promulgation of EO41
and not to assessments theretofore made.
ISSUE:
Whether or not the assessment can withstand effects of tax amnesty.
HELD:
A tax amnesty, being a general pardon or intentional overlooking by the state its authority
to impose penalties on persons otherwise guilty of evasion or violation of a revenue or tax law,
partakes of an absolute forgiveness or waiver by the government itself of its right to collect what
otherwise would be due it, and in this sense, prejudicial thereto, to give tax evaders, who wish to
relent and are willing to reform a chance to do so and thereby become a part of the new society
with a clean slate. Section 4 of EO 41 enumerated, in no uncertain terms, taxpayers who may
not avail to the amnesty granted. The company does not fall under any of the exceptions. The
added exception urged by the Commissioner based on Revenue Memorandum Order 4-87,
further restricting the scope of the amnesty, work against the raison d’etre of EO 41 and clearly
amounts to an alt of administrative legislation contrary to the mandate of the law which the
regulation ought to implement. The rule in the order that only assessments issued after 21 August
1986 shall be abated is beyond the contemplation of the law