Philippines
National
'Lack of jurisdiction' prompts CTA to dismiss firm's petition vs BIR's P10.3M deficiency tax assessment
'Lack of jurisdiction' prompts CTA to dismiss firm's petition vs BIR's P10.3M deficiency tax assessment
For lack of jurisdiction, the Court of Tax Appeals (CTA) has dismissed the petition filed by Friendlycare Foundation, Inc. which challenged the P10.3 million deficiency income tax and value-added tax assessed by the Bureau of Internal Revenue (BIR) for taxable year 2014.
The petition was filed by Friendlycare on July 19, 2019 challenging the final decision on the disputed assessment (FDDA) issued by the BIR on Nov. 29, 2018 directing the firm to pay P10,366,086.95 in deficiency taxes.
In its website, Friendlycare said it is "a foundation and social enterprise that advocates healthcare initiatives for the Filipino family especially in primary cre, reproductive health and mental health.
Friendlycare filed its petition before the CA even as it sought a motion for reconsideration before the BIR on Dec. 21, 2018.
In its 22-page decision, the CTA's first division dismissed the petition for review for lack of jurisdiction.
The decision, written by Associate Justice Jean Marie A. Bacorro-Villena with the concurrence of Presiding Justice Roman G. Del Rosario and Associate Justice Lanee S. Cui-David, stated:
"In this case, petitioner (Friendlycare) opted to file an administrative appeal, through a Request for Reconsideration on the FDDA, before respondent CIR (Commissioner of Internal Revenue) on 21 Dec. 2018. On the belief that it was granted a fresh 180-day period from 21 Dec. 2018, petitioner claimed that such period lapsed on 19 June 2019.
"Thus, counting 30 days therefrom, petitioner alleged that its Petition for Review filed on 19 July 2019 was filed within the reglementary period.
"To be clear, the 180-day period referred to in Section 228 of the NIRC (National Internal Revenue Code) of 1997, as amended, and in Section 3.1.4 of RR No. 12-99, as amended by RR No. 18-2013, is confined only to the period within which either the CIR or his or her duly authorized representative may act on the initial protest against the FLD/FAN. If the taxpayer opts to appeal to the CIR the final decision of the latter’s duly authorized representative, the taxpayer’s remaining option (after the 180-day period expires) is to wait for the CIR’s decision before elevating its case to the CTA.
"In other words, when a taxpayer opts to file an administrative appeal, the CIR is not given a fresh or separate 180-day period within which to decide the administrative appeal.
"Unfortunately, petitioner opted to still file an administrative appeal against the FDDA before respondent CIR. Then, without waiting for any action from respondent CIR, petitioner filed the instant Petition for Review before this Court on 19 July 2019.
"Considering that the 180-day period has already lapsed by the time respondent (CIR) issued the FDDA on 26 Nov. 2018, there is no longer any appealable inaction on the part of respondent. It is only after respondent CIR acts on petitioner’s administrative appeal that petitioner could file an appeal before this Court.
"Basic is the rule that jurisdiction over the subject matter of a case is conferred by law and determined by the allegations in the complaint.
"Wherefore, the foregoing premises considered, the present Petition for Review filed by petitioner Friendlycare Foundation. Inc. on 19 July 2019 is hereby dismised for lack of jurisdiction."