The Court of Tax Appeals (CTA) has ordered Fort Bonifacio Development Corporation (FBDC) to pay the Bureau of Internal Revenue (BIR) P28.58 million in deficiency value-added (VAT) taxes, surcharges, and interests as of Dec. 31, 2017.

In a decision, the CTA also directed FBDC to pay interest at the rate of 12 percent annually or P7,774.18 daily from Jan. 1, 2018 based on the total of P23.6 million taxes due as of April 30, 2017.

It said the payment of interests is in line with Section 249(C) of the National Internal Revenue Code (NIRC) of 1997, as amended by the Tax Reform for Acceleration and Inclusion Law, and implemented by Revenue Regulations No. 21-2018.

However, the CTA cancelled the P75,000 administrative penalties imposed by the BIR from Jan. 1 to June 30, 2014 in the latter’s formal letter of demand (FLD).

"Considering that this decision is partly favorable to the national government, the BIR, through respondent, is hereby authorized to seize and distraint any goods, chattels, or effects, and the personal property, including stocks and other securities, debts, credits, bank accounts, and interests in and rights to personal property and/or levy the real property of petitioner (FBDC) in sufficient quantity to satisfy the tax or charge with any increment thereto incident to delinquency," the CTA also ruled.

The case stemmed from the Petition for Review filed by FBDC on July 1, 2021 seeking to cancel its deficiency VAT of P656,446,244.25 million for the period from January to June 2014, inclusive of interest.

FBDC argued that the deficiency tax assessments are null and void as they were issued in violation of its right to due process. It also insisted that the assessment is void since its FLD and Final Decision on Disputed Assessment (FDDA) are not final demands for payment, and its tax liability remains indefinite.

The CTA agreed only on the issue of FDDA since the valid due date for payment was not indicated. "The FDDA is void for failure to indicate a fixed and definite amount of tax liability to be paid by the petitioner," the tax court said.

But it said the FLD did not suffer from the same defect as the FDDA and was still considered valid.

The court also cancelled several VAT assessments for lack of factual basis and adjusted and deducted others.

The 36-page decision was written by Associate Justice Corazon G. Ferrer-Flores with the concurrence of Associate Justice Maria Rowena Modesto-San Pedro.