G.R. No. 187589 - COMMISSIONER OF INTERNAL REVENUE, VS. THE STANLEY WORKS SALES (PHILS.), INCORPORATED.D E C I S I O N - Supreme Court E-Library

Ruling

Accordingly, the court cancelled Assessment Notice No. 002523-89-6014 dated 12 April 1993. The CTA Division ruled that the request for reconsideration did not suspend the running of the prescriptive period to collect deficiency income tax. There was no valid waiver of the statute of limitations, as the following infirmities were found: (1) there was no conformity, either by respondent or his duly authorized representative; (2) there was no date of acceptance to show that both parties had agreed on the Waiver before the expiration of the prescriptive period; and (3) there was no proof that respondent was furnished a copy of the Waiver. Applying jurisprudence and relevant BIR rulings, the waiver was considered defective; thus, the period for collection of deficiency income tax had already prescribed. THE CTA EN BANC RULING [5] The CTA En Banc affirmed the CTA First Division Decision dated 6 May 2008 and Resolution dated 14 July 2008. The Waiver executed by respondent on 16 November 1993 could not be used by petitioner as a basis for extending the period of assessment and collection, as there was no evidence that the latter had acted upon the waiver. Hence, the unilateral act of respondent in executing said document did not produce any effect on the prescriptive period for the assessment and collection of its deficiency tax. As to the issue of estoppel, the court ruled that this measure could not be used against respondent, as it was petitioner who had failed to act within the prescribed period on the protest asking for a reconsideration of the assessment. ISSUES In the present recourse, petitioner raises the following issues: Whether or not petitioners right to collect the deficiency income tax of respondent for taxable year 1989 has prescribed. Whether or not respondents repeated requests and positive acts constitute estoppel from setting up the defense of prescription under the NIRC. [6] THE COURTS RULING We deny the Petition. Petitioner mainly argues that in view of respondents execution of the Waiver of the statute of limitations, the period to collect the assessed deficiency income taxes has not yet prescribed. The resolution of the main issue requires a factual determination of the proper execution of the Waiver. The CTA Division has already made a factual finding on the infirmities of the Waiver executed by respondent on 16 November 1993. The Court found that the following requisites were absent: (1) Conformity of either petitioner or a duly authorized representative; (2) Date of acceptance showing that both parties had agreed on the Waiver before the expiration of the prescriptive period; and (3) Proof that respondent was furnished a copy of the Waiver. [7] These findings are undisputed by petitioner. In fact, it cites BPI v. CIR [8] to support its contention that the approval of the CIR need not be express, but may be implied from the acts of the BIR officials in response to the request for reinvestigation. Accordingly, petitioner ar