The Court of Tax Appeals (CTA) has cancelled the seizure warrant and tax debts of a jewelry manufacturer for failure of the Bureau of Internal Revenue (BIR) to inform the latter about the liabilities.

The court en banc said the V.Y Domingo Jewellers, Inc. of Novaliches, Quezon City did not receive any notice from the BIR to settle the P3.2 million deficiency taxes incurred in 2007.

In affirming the decision of it's Third Division, the full court said the BIR was aware that the company had transferred it's business in Quezon City, but kept on sending notices to it's old address in Sampaloc, Manila.

"The lack of notice by the BIR for payment constitutes a clear violation of the taxpayer's right to due process," said the resolution penned by Associate Justice Jean Marie A. Bacorro-Villena.

The decision set aside the position of the bureau that the taxpayer did not exhaust all administrative remedies before elevating the case to the court.

The court said the taxpayer was compelled to bring the case to the CTA because the BIR had already started garnishing it's bank deposits to enforce the collection of the indebtedness.

The court also noted that BIR failed to present proofs that the jewelry store received assessment notices like the registry return card issued by the Bureau of Post.