Allied Banking Corp vs CIR

GR No. 175097

Facts:
On April 30, 2004, the BIR issued a Preliminary Assessment Notice (PAN) to petitioner
for deficiency Documentary Stamp Tax (DST) and Gross Receipt Tax (GRT) for taxable year
2001. Petitioner received the PAN on May 18, 2004 and filed protest against it on May 27, 2004.
In response thereto, the BIR on July 16, 2004 issued a Formal Letter of Demand with
Assessment Notices, which partly reads:
It is requested that the above deficiency tax be paid immediately upon receipt hereof, inclusive
penalties incident to delinquency. This is our final decision based on investigation. If you
disagree, you may appeal the final decision within 30 days from receipt hereof, otherwise said
deficiency tax assessment shall become final, executory and demandable.
Instead of protesting the demand with assessment notice, petitioner filed a petition for
review with the CTA.
CTA dismissed the petition stating that it is neither the assessment nor the formal demand
letter itself that is appealable before it but instead it should be the decision of the CIR on the
disputed assessment.

Issue:
WON the Formal Letter of Demand be construed as the final decision of the CIR
appealable to the CTA under R.A. 9282.

Ruling:
Yes. This is considered an exception to the general rule on exhaustion of administrative
remedies since the CIR is estopped from claiming the same principle applies in its case.
The tenor of the demand letter is clear that the CIR had already made a final decision and
that the remedy of the Petitioner was to appeal the same within 30 days of receipt. This can be
gleaned from the use of terms “final decision” and “appeal” which were deemed unequivocal
language pointing to the finality of the decision. While the Court cited the rules relative to (a)
protesting the FAN and not the PAN and (b) counting the 30-day period to appeal to the CTA
from receipt of the decision of the CIR and not the issuance of the assessment, this particular
case was deemed a clear exception in view of the CIR’s own actions.