The Court of Tax Appeals (CTA) has voided the Bureau of Internal Revenue’s (BIR) P347 million deficiency tax assessment against a big distributor of medical equipment due to legal technicalities.
The court’s Third Division stated that the case against Medical Center Trading Corporation of Pasig City was dismissed “due to BIR’s substantial and procedural lapses, the assessment hardly fall under the jurisprudential definition of the assessment under the Tax Code.”
It noted that the final assessment notice (FAN) sent to the medical supplier did not contain a computation of the tax liabilities as required under the Tax Code and revenue regulations.
The FAN did not also include the date for the settlement of the tax debts as required under a revenue regulations, it added.
The waivers executed by the taxpayer and the BIR extending the period of investigation was also invalid as they do not contain the specific amount to be collected.
The deficiency tax assessment was issued by the bureau’s large taxpayers service for the year 2009 covering income, value-added, withholding and documentary stamp taxes.
The 21-page resolution was penned by Associate Justice Ma. Belen Ringpis-Liban.