CTA EB No.

1847 Sep 27, 2019 corresponding notation thereto, including the previous UA number and date of issue
of said UAs."
Vesta Property Holdings vs C.I.R.
In this Case no new LOI was issued designating Revenue officer Lati to continue the
Topic: Issuance of a letter of authority audit investigation of VPHI the subject tax assessment is void in view of the lack of
the requisite authority of RO Lati to conduct the audit investigation of VPHI for taxable
Facts:
year 2009.
>Vesta Property Holdings (VPHI) sold two parcels of land with the area of 404,691
square meters in canlubang, laguna for P882 per square meter.

>VPHI received a Letter of Authority (LOA) from the BIR covering the
investigation/audit of its internal revenue taxes for 2009 and was informed of a
donor’s tax deficiency for the sale of the lot below its fair market value.

>The C.I.R. values the land at P1,200 per square meter, C.I.R. alleges that the land
was sold below is Fair market value which renders VPHI liable for donors tax citing
sec. 100 of the NIRC which states that “any transfer for less than adequate and full
consideration, regardless of whether such transfer is an ordinary commercial
transaction or not. The excess of the FMV over the consideration shall be deemed as
a gift which is subject to donor’s tax

>In this Case Revenue officers Wenceslao Jr Concepcion, Gerald Quebral, Belinda
Balagtas, Cecile uy and Noemi Castro were authorized to examine the books of VPHI
through the LOI issued by the CIR but the report came from Cristina C. Lati who was
not authorized by the LOI but only a through a memorandum of assignment signed by
the OIC chief Antonio Jaminola

Issue: Whether or Not the assessment of VPHI by the CIR is valid

Ruling:

No, Accordig the RMO no 43-90 which lays down the guidelines for the
audit/investigation and issuance of LOA which states that

1. All audits/investigations, whether field or office audit, should be conducted

under a Letter of Authority.

5. Anv re-assignment/transfer of cases to another RO(s), and revalidation of UAs

which havealready expired. shall require the issuance of a new L/A, with the