G.R. No. 261065 - COMMISSIONER OF INTERNAL REVENUE, VS. MAXICARE HEALTHCARE CORPORATION.

Ruling

WHEREFORE , the instant Petition for Review filed by petitioner Maxicare Healthcare Corporation is hereby GRANTED . Accordingly, the Final Decision on Disputed Assessment dated December 9, 2015 issued against petitioner is WITHDRAWN and SET ASIDE . Furthermore, the Formal Letter of Demand and Final Assessment Notice, both dated October 8, 2015, assessing petitioner for deficiency Value-Added Tax and Compromise Penalty for calendar year 2012, are likewise CANCELLED and SET ASIDE. SO ORDERED . [15] (Emphasis in the original) The CTA First Division ruled that the CIR had violated Maxicare's right to due process, as the CIR failed to give Maxicare the opportunity to submit relevant supporting documents within 60 days from the filing of its protest to the FLD/FAN, which protest was a request for reinvestigation, as mandated by Section 228 of the National Internal Revenue Code of 1997, as amended ( NIRC ), and Revenue Regulations ( RR ) No. 12-99, as amended, which implements Section 228 of the NIRC. [16] The CTA First Division found that as the FDDA was issued prior to the lapse of the 60-day period which Maxicare had to file its supporting documents, then the FDDA was issued prematurely and in violation of Maxicare's due process rights. The CTA First Division held pertinently: The record shows that on November 9, 2015, or within the 30-day period from receipt of the FAN/FLD, petitioner filed a letter protest dated November 6, 2015 explicitly requesting for a reinvestigation of its tax case. The relevant portion of the said letter protest reads as follows: Considering the clarifications made, we request for reinvestigation of the BIR assessment of deficiency VAT for 2012 , and the cancellation and/or withdrawal of the FAN and the FLD for being without basis in fact and in law. We shall submit within sixty (60) days from the date of filing hereof the pertinent supporting documents and additional explanations on the foregoing items in the assessment. Hence, petitioner had 60 days from the filing of such letter protest or until January 8, 2016 to submit relevant supporting documents. Respondent however in haste issued the assailed FDDA on December 9, 2015 without allowing the 60-day period to lapse thereby preventing petitioner from submitting relevant supporting documents for purposes of reinvestigation of its tax case in clear violation of its right to due process. Respondents blatant disregard of petitioner's right to due process rendered the subject deficiency tax assessments null and void. As such, the said deficiency tax assessments bear no valid fruit. In view thereof, the Court finds it unnecessary to address or resolve the other issues raised by the parties. [17] (Emphasis in the original; citations omitted) The CTA First Division, in a Resolution, [18] dated July 21, 2020, denied the CIR's Motion for Reconsideration of the January 16, 2020 Decision for lack of merit. In the Resolution, the CTA First Division held: As declared by the Supreme Cou