Commissioner of Internal Revenue vs. Philippine Aluminum Wheels, Inc.

G.R. No. 216161 | August 9, 2017

CARPIO, J.

FACTS:
On November 8, 2006, the Bureau of Internal Revenue (BIR) issued a Final Decision on Disputed
Assessment (FDDA) against respondent covering deficiency taxes from the taxable year 2001. On
September 21, 2007, respondent complied with the requirements of the Tax Amnesty Program under
Republic Act No. 9480 granting an amnesty on all unpaid internal revenue taxes imposed by the national
government for taxable year 2005 and prior years. It was, however, denied by the BIR, contending that the
respondent’s availment of the tax amnesty under RA 9480 had no effect on the assessment due to the
finality of the FDDA prior to respondent’s tax amnesty availment.

Respondent filed a Petition for Review with the Court of Tax Appeals (CTA), which, as affirmed by the CTA En
Banc, set aside the assessment. Thus, the CIR filed a Petition for Review on Certiorari before the Supreme
Court.

ISSUE:
Whether respondent is entitled to the benefits of the Tax Amnesty Program under RA 9480.

RULING:
Yes.

In Philippine Banking Corporation v. Commissioner of Internal Revenue, the Court held that the taxpayer’s
completion of the requirements under RA 9480 will extinguish the taxpayer’s tax liability, additions and all
appurtenant civil, criminal, or administrative penalties under the National Internal Revenue Code.

Section 8(f) of RA 9480 is clear: only persons with “tax cases subject of final and executory judgment by the
courts” are disqualified to avail of the Tax Amnesty Program under RA 9480. There must be a judgment
promulgated by a court and the judgment must have become final and executory. Obviously, there is none
in this case. The FDDA issued by the BIR is not a tax case “subject to a final and executory judgment by the
courts” as contemplated by Section 8(f) of RA 9480. The determination of the tax liability of respondent has
not reached finality and is still not subject to an executory judgment by the courts as it is the issue pending
before this Court.