1

shall be retrieved and re-

placed with the new eLA
form (BIR Form 1966). All
revenue officer ordered to
conduct investigation/audit
through manually issued LAs
prior to 1 July 2010 should
continue the conduct of audit/
investigation subject to the
retrieval of and replacement
of LAs.

REVENUE MEMORAN-
DUM ORDER 70-2010
Prescribes the guidelines and
procedures for the conversion
of Accounts Receivables/
Delinquent Accounts (ARs/
DAs) into the Accounts Re-
ceivables Conversion System
(ARCS).
All manually identified ARs/
DAs shall be converted into
the system, including the un-
paid 2
nd
installments of indi-
vidual taxpayers Income Tax
liabilities and dishonored
checks. ARs and DAs that
will be created beginning 1

REVENUE MEMORAN-
DUM ORDER 68-2010

Prescribes the guidelines and
procedures in the verification
and surrender of Documen-
tary Stamp Electronic Im-
printing Machines (DSEIMs)
and transfer of unused/
unloaded Documentary
Stamp Tax balance to the
Electronic Documentary
Stamp Tax (eDST) System.
All taxpayers/users of the
DSEIMs and the transfer of
the DST balances to the
eDST System to the Assis-
tant Commissioner on or
before 31 August 2010
otherwise any other unused
DST balances still loaded in
the DSEIM after the said
date shall be deemed forfeit-
ed in favor of the BIR.
Any taxpayers/users of com-
pany-owned DSEIMs who
opted to forego the verifica-
tion of the DSEIMs shall be
precluded from transferring any
unused DST balance(s) loaded
in the said machines to the
eDST system.

REVENUE MEMORAN-
DUM ORDER 69-2010

Prescribes the guidelines on the
issuance of electronic Letters of
Authority (eLAs), Tax Verifica-
tion Notices (TVNs) and Mem-
oranda of Assignment (MOA).
Starting 16 August 2010, only
eLAs printed on BIR Form
1966 shall be issued by the BIR
for the audit/investigation of tax
liabilities, except Estate Tax
cases. TVNs shall be issued for
Estate Tax cases irrespective of
the amount of gross estate until
31 December 2010.
All Letters of Authority (LAs),
whether manual or electronic,
issued from 1 March 2010 cov-
ering cases for 2009 and other
taxable years, as well as LAs
issued by the Commissioner
pursuant to RMC No. 61-2010
I ns i de t hi s
i s s ue:
BIR Issuances 2
SEC Issuance 3
Legal Updates 4
Jurisprudence 6
JLs Corner 9


LCA LINES
A U G U S T 2 0 1 0 V o l u m e I I I I s s u e N o . 8
Serving your purpose, realizing your dreams...
BIR ISSUANCES
2

V o l u m e I I I I s s u e N o . 8 A U G U S T 2 0 1 0
August 2010 and are included in
the Monthly of Summary Taxes
Assessed (BIR Form No. 40.00),
Collectible and Disputed Assess-
ment shall be encoded in the
ARCS by the Assessment Divi-
sion, Large Taxpayers Service and
Enforcement Service, as the case
may be, before the dockets of these
cases are transmitted to the Collec-
tion Division or concerned Reve-
nue District Office (RDO)/Large
Taxpayers District Office (LTDO)/
Large Taxpayers Collection En-
forcement Division (LTCED), as
the case may be. For unpaid se
cond installments of individual
taxpayers income tax liabilities
and dishonored checks that will be
identified/created beginning 1 Au-
gust 2010, these delinquent ac-
counts shall also be encoded into
the ARCS by the RDOs immedi-
ately upon identification thereof.

REVENUE MEMORANDUM
ORDER NO. 72-2010

Prescribes the guidelines on the
processing of Tax Treaty Relief
Applications (TTRA) pursuant to
Philippine Tax Treaties.
The following documents are the
general documentary requirements
that shall be attached to all duly
accomplished TTRAs (3copies)
which must be signed by the appli-
cant who may either be the income
earner or the authorized repre-
sentative:
Proof of Residency;
Articles of Incorporation
(for income earner other
than an individual);
Special Power of Attorney;
Certification of Business
Presence in the Philip-
pines; and
Certificate of No Pending
Case.
Other documentary requirements
and procedures for the processing
of specific applications for relief
from double taxation under exist-
ing tax treaties (i.e. those pertain-
ing to business profits, shipping,
air transport, royalties, etc.) are
specified in the Revenue Memo-
randum Order No. 1-2000.
All tax treaty relief applications
relative to the implementation and
interpretation of the provisions of
Philippine tax treaties shall only be
submitted to and received by the
International Tax Affairs Division
(ITAD). If the forms or any other
necessary documents are submitted
to any other BIR Office, the appli-
cation shall be considered as im-
properly filed.
Filing should always be made BE-
FORE the transaction. Transac-
tion, for purposes of filing the
TTRA, shall mean before the oc-
currence of the first taxable event.
Failure to properly file the TTRA
with ITAD within the prescribed
period shall have the effect of dis-
qualifying the TTRA under the
Order.
Taxpayer/applicant shall not be
allowed to withdraw any TTRA/
documents already filed with IT-
AD. The same shall remain with
ITAD for custodianship and safe-
keeping.
REVENUE MEMORANDUM
ORDER 73-2001

Further amends certain provi-
sions of Revenue Memorandum
Order No. 3-2009 relative to the
submission of reportorial require-
ments under the Oplan Kan-
dado Program.

REVENUE MEMORANDUM
CIRCULAR 68-2010

Prescribes the guidelines and pro-
cedures in granting the request of
Large Taxpayers (LTs) for exten-
sion in complying with the re-
quirements for the mandatory use
of Computerized Accounting
System (CAS) and/or compo-
nents thereof under Revenue
Regulation (RR) No. 9-2009.
All LTs currently maintaining
books of accounts and accounting
records in manual form are re-
quired to register their CAS and/
or thei components thereof not
later than 31 December 2009.
However due to time and budget-
3

A U G U S T 2 0 1 0 V o l u m e I I I I s s u e N o . 8
ary constraints, some LTs have
requested for a reasonable win-
dow to comply beyond the set
deadline.
The LTs covered by the set dead-
line include the following:
-Those using an excel program in
their recordkeeping or maintain-
ing their books of accounts and
other accounting records in man-
ual form;
-Those already using CAS and/or
components thereof, whether off-
the-shelf or customized system,
without securing the required
Permit to Use/Adopt CAS and/or
components thereof from the
Large Taxpayers Service (LTS);
and
-Those using CAS and/or compo-
nents thereof and were issued
permit to use such system prior to
taxable year 2002, but are re-
quired to apply for revalidation
of existing permit on or before 31
December 2010.
Said LTs who failed to comply
within the prescribed deadline for
the registration of their CAS and/or
components thereof, shall submit a
letter addressed to the Assistant
Commissioner, LTS (ACIR-LTS),
Chief, Large Taxpayers Assistance
Division (LTAD) or Chief, Large
Taxpayers District Office (LTDO),
as the case may be, requesting for
an extension of time within which
to comply with the requirements
set forth under RR No. 9-2009.

REVENUE MEMORANDUM
CIRCULAR NO. 70-2010

Circularizes the revocation of BIR
Ruling Nos. DA-413-04 dated 30
July 2004 and DA-436-04 dated 12
August 2004 and clarifies the basis
in computing depreciation of prop-
erty, plant and equipment.
The Supreme Court, in its decision
in Basilan Estates, Inc. vs. CIR
(GR No. L-224992, 5 September
1967), held that depreciation of an
asset must be premised on its ac-
quisition cost, and not on its reap-
praised value.
The BIR reiterated said principle
in RAMO No. 1-00 (dated 7
March 2000), which states that:
No depreciation is allowable on
the appraisal increase of fixed as-
sets. Any foreseeable salvage val-
ue is to be deducted from the cost
of the asset in determining the
basis of depreciation.
The concept of depreciation as a
mere recovery cost has not
changed from the Old Tax Code to
the present. Thus, there is no
compelling reason to deviate from
the sound principles laid down in
the aforecited Decision of the Su-
preme Court.

MEMORANDUM CIRCU-
LAR NO. 6 SERIES OF 2010

To maintain and organized and
orderly filing of Financial State-
ments (FS), the Commission,
pursuant to its authority under
the Corporation Code and Secu-
rities Regulation Code the fol-
lowing measures in filing of the FS
of companies whose fiscal year
ends on 31 December 2010.

-All corporation including branch
offices, representative offices, re-
gional headquarters and regional
operating headquarters of foreign
corporations, that file their FS at
the Commissions head office
shall, depending on the last numer-
ical digit of their SEC registration
or license number, be governed by
the following schedule in filing
period for 2011:

April 14, 15, 18, 19, 201 and
2
SECURITIES and EXCHANGE
COMMISSION ISSUANCE
4

V o l u m e I I I I s s u e N o . 8 A U G U S T 2 0 1 0
-Corporations whose fiscal year
ends on a date other than 31 De-
cember 2010 shall comply with
their original filing schedule.
-Prior to 18 April 2011, all corpo-
rations may file their FS regardless
of the last numerical digit of their
registration or license number.






LEGAL UPDATES
April 25, 26, 27, 28, 293 and
4
May 3, 4, 5, 65 and 6
May 9, 10, 11, 12, 137 and
8
May 16, 17, 18, 19, 209 and
0
RA 10086

STRENGTHENING
PEOPLES NATIONALISM
THROUGH
PHILIPPINE HISTORY
ACT


FEATURES:

RA 10086 changed the National
Historical Institute into the
National Historical Commission
of the Philippines (NHCP), an
independent agency attached to the
National Commission for Culture
and the Arts. The NHCP was de-
clared to be the primary govern-
ment agency responsible for histo-
ry and has the authority to deter-
mine all factual matters relating to
official Philippine history.

To view full text, please go to:
http://nhi.gov.ph/files/
RA10086.pdf




RA 10088

ANTI-CAMCORDING ACT
OF 2010

FEATURES:

The Act declares and lists down
unlawful acts committed when a
copyright exists in a cinemato-
graphic film or other audiovisual
work or its soundtrack, without the
authorization of the copyright
owner or exclusive licensee.

The Act provides for presumptions
on the subsistence of copyright
and/or ownership of copyright. It
shall not be a defense that the
transmission or the making of a
copy is for private or domestic pur-
poses, or in connection with a fair
use deal.

All exhibition facilities, cinemas or
theatres are required to conspicu-
ously post notices
or signages warning against the
bringing in of audiovisual record-
ing devices into the screening/
exhibition area. The management/
operator who fails to post these
required notices shall be fined.

To view full text, please go to:
http://www.senate.gov.ph/
republic_acts/ra%2010088.pdf



RA 10089

PHILIPPINE RUBBER RE-
SEARCH INSTITUTE ACT
OF 2010

FEATURES:

The Act created the Philippine
Rubber Research Institute (PRRI)
from the main institute for rubber
at the Mindanao Statue University,
and placed under the control and
supervision of the Department of
Agriculture (DA). The PRRIs
5

A U G U S T 2 0 1 0 V o l u m e I I I I s s u e N o . 8
mandate is to initiate and adminis-
ter research and development pro-
grams to improve the quality and
increase the productivity of rubber,
especially for the benefit of small-
holder rubber producers and pro-
cessors.

To view full text, please go to:
http://www.senate.gov.ph/
republic_acts/ra%2010089.pdf



RA 10054

MOTORCYCLE HELMET
ACT OF 2009


FEATURES:

Mandates that all motorcycle rid-
ers, both drivers and back riders,
but except tricycle drivers, shall
wear standard protective motorcy-
cle helmets, regardless of the
length of the drive and the type of
the road. Failure to wear the re-
quired helmet shall be punished
with a fine.

Sellers and dealers of motorcycles
are also mandated to make availa-
ble for purchase a standard motor-
cycle helmet for each motorcycle
unit.

Finally, a person who uses, sells,
and distributes substandard motor-
cycle helmets, or those which do
not bear the required Philippine
Standard (PS) mark or Import
Commodity Clearance (ICC) cer-
tificate, shall likewise be penal-
ized. These fines shall be without
prejudice to the penalties imposed
under the Consumer Act of the
Philippines (RA 7394).

To view full text, please go to:
http://www.senate.gov.ph/
republic_acts/ra%2010054.pdf



RA 10055

PHILIPPINE TECHNO- LO-
GY TRANSFER ACT OF
2009


FEATURES:
Provides for the framework and
support system for the ownership,
management, use and commercial-
ization of intellectual property gen-
erated from government funded
researches.

To view full text, please go to:
http://www.senate.gov.ph/
republic_acts/ra%2010055.pdf


EXECUTIVE ORDER
NO. 885

MODIFYING THE NOMEN-
CLATURE AND THE
RATES OF DUTY ON IM-
PORTED EDUCATIONAL,
TECHNICAL, SCIENTIFIC
AND HISTORICAL OR
CULTURAL BOOKS UN-
DER SECTION 104 OF THE
TARIFF AND CUSTOMS
CODE OF 1978
(PRESIDENTIAL DECREE
NO. 1464), AS AMENDED

FEATURES:

The Philippines, as signatory to the
United Nations Educations, Scien-
tific and Cultural Organization
Florence Agreement undertakes
"not to apply customs duties or
other charges on, or in connection
with, the importation of (a) books,
publications and documents; (b)
educational, scientific and cultural
materials, which are the products
of another Contracting State, sub-
ject to conditions.
To view full text, please go to:
http://
www.tariffcommission.gov.ph/
eo_885.htm




6

V o l u m e I I I I s s u e N o . 8 A U G U S T 2 0 1 0

CITY MAYOR, CITY TREAS-
URER, CITY ASSESSOR, ALL
OF QUEZON CITY, and ALVIE-
MERSON S. YU
vs.
RIZAL COMMERCIAL
BANKING CORPORATION
G.R. No. 171033
August 3, 2010


FACTS: Spouses Roberto and
Monette Naval (spouses Naval) ob-
tained a loan from RCBC. The real
estate mortgage was later foreclosed
and the properties were sold at pub-
lic auction with RCBC as the high-
est bidder. Certificates of Sale were
issued.

An auction sale of tax delinquent
properties was conducted by the
City Treasurer of Quezon City. Al-
vin Emerson S. Yu (Yu) was the
highest bidder. Upon payment of
the tax delinquencies, he was issued
the Certificate of Sale of Delinquent
Property.

Spouses Naval contended, that it
had until one (1) year from the date
of registration of the certificate of
sale to redeem the property.

ISSUE: Whether or not spouses
Naval has a right to redemption.

RULING: Spouses Naval has a
right to redemption.

The owner of the delinquent real
property or person having legal
interest therein, or his representa-
tive, has the right to redeem the
property within one (1) year from
the date of sale upon payment of
the delinquent tax and other fees.
Verily, the period of redemption of
tax delinquent properties should be
counted not from the date of regis-
tration of the certificate of sale, as
previously provided by Section 78
of P.D. No. 464 (The Real Proper-
ty Tax Code), but rather on the
date of sale of the tax delinquent
property, as explicitly provided by
Section 261 of R.A. No. 7160 (The
Local Government Code of 1991).

CARLOS DE CASTRO
vs.
LIBERTY BROADCASTING
NETWORK INC. and
EDGARDO QUIOGE
G.R. No. 165153
August 25,2010


FACTS: Carlos C. de Castro (de
Castro) filed a complaint against
its employer Liberty Broadcasting
Network Inc. (LBNI) for illegal
dismissal with NLRC praying for
reinstatement, payment of back
wages, damages, and attorneys
fees. He maintained that he could
not have solicited commissions
from suppliers considering that he
was new in the company.

The Labor Arbiter (LA) rendered
a decision in de Castros favor,
holding LBNI liable for illegal
dismissal.

The National Labor Relations
Commission (NLRC) ruled in
favor of de Castro.

ISSUE: Whether or not LBNI is
liable for illegal dismissal.

RULING: LBNI is liable for
illegal dismissal.

The Court found de Castros dis-
missal was based on unsubstanti-
ated charges. De Castro had not
stayed in the company and had
not even passed the probationary
period and when the acts charged
allegedly took place. This is con-
trary to common practice since
new employees will have a posi-
tive motivation to make a good
impression in order to be regular-
ized.

The Court ruled that the grounds
that LBNI invoked for de Castros
dismissal were doubtful. These
doubts should be interpreted in
JURISPRUDENCE
7

A U G U S T 2 0 1 0 V o l u m e I I I I s s u e N o . 8
De Castros favor pursuant to Arti-
cle 4 of Labor Code. Between a
laborer and his employer, doubts
reasonably arising from the evi-
dence or interpretation of agree-
ments and writing should be re-
solved in the formers favor.


MICHAEL B. BELEN
vs.
JUDGE MEDEL ARNALDO B.
BELEN, Regional Trial Court,
Calamba City, Branch 36
A.M. No. RTJ-08-2139,
August 9,2010



FACTS: Michael B. Belen
(Michael) filed a complaint with
the Office of the Court Admin-
istrator (OCA) of the Supreme
Court, charging Judge Medel
Arnaldo B. Belen (Judge Medel)
with grave abuse of authority
and conduct unbecoming a
judge. According to Michael,
Judge Medel filed a case for
Estafa against Michaels father,
Nezer D. Belen (Nezer), but the
same was dismissed for lack of
probable cause.

Thereafter, Judge Medel alleg-
edly started harassing and
threatening Nezer with the fil-
ing of several cases against the
latter.

ISSUE: Whether or not Judge
Medel is guilty of grave abuse
of discretion.

RULING: Judge Medel is
guilty of grave abuse of discre-
tion.
In this case where Judge Medel
committed the acts of threat
and harassments against Mi-
chael and Nezer, the former
violated the rule that judges
shall not allow family, social or
other relationships to influence
judicial conduct or judgment.
That propriety and appearance
of propriety are essential to the
performance of the judge.


PEOPLE OF THE
PHILIPPINES
vs.
ESTELA TUAN y BALUDDA
G.R. No. 176066
August 11, 2010

FACTS: Two separate Infor-
mations were filed before the RTC
against Estela Tuan y Baludda
(Baludda) for illegal possession of
marijuana and illegal possession of
firearm.

The Regional Trial Court (RTC)
found Baludda guilty as charged.
The Court of Appeals affirmed the
decision of the RTC with regard to
the illegal possession of marijuana
and acquitted the accused with re-
gard to the charge of illegal pos-
session of firearm since the records
were bereft of evidence that the
gun supposedly confiscated from
Baludda was unlicensed.

ISSUE: Whether or not there was
a showing of procedural defect or
lapses in the issuance of the search
warrant.

RULING: There was no showing
of procedural defect or lapses in
the issuance of the search warrant.

The validity of the issuance of a
search warrant rests upon the fol-
lowing factors: (1) it must be is-
sued upon probable cause; (2) the
probable cause must be determined
by the judge himself and not by the
applicant or any other person; (3)
in the determination of probable
cause, the judge must examine,
under oath or affirmation, the com-
plainant and such witnesses as the
latter may produce; and (4) the
warrant issued must particularly
describe the place to be searched
and persons or things to be seized.

8

V o l u m e I I I I s s u e N o . 8 A U G U S T 2 0 1 0
A description of the place to be
searched is sufficient if the officer
serving the warrant can, with rea-
sonable effort, ascertain and identi-
fy the place intended and distin-
guish it from other places in the
community. In the case at bar, the
address and description of the
place to be searched in the Search
Warrant was specific enough.




VICTORINA (VICTORIA)
ALICE LIM LAZARO
vs.
BREWMASTER INTERNA-
TIONAL, INC.
G.R. No. 182779
August 23, 2010


FACTS: Brewmaster Internation-
al, Inc., (Brewmaster) is a market-
ing company engaged in selling
and distributing beer and other
products of Asia Brewery, Inc.
Brewmaster filed a Complaint for
Sum of Money against Prescillo G.
Lazaro (Prescillo) and Victorina
(also known as Victoria) Alice
Lazaro alleging that Prescillo and
Victoria obtained on credit from
Brewmaster beer and other prod-
ucts and despite repeated demands,
they have failed and refused to pay
their aforesaid obligation.

The Metropolitan Trial Court
(MeTC) dismissed the complaint
ratiocinating that Brewmaster
failed to meet the burden of proof
required to establish its claim by
preponderance of evidence.

The Regional Trial Court (RTC)
found no reversible error in the
assailed decision.

The Court of Appeals (CA) ruled
in favor of Brewmaster.

ISSUE: Whether or not the Com-
plaint failed to state a cause of ac-
tion.

RULING: The Complaint did not
fail to state a cause of action.

The basic requirement under the
rules of procedure is that a com-
plaint must make a plain, concise,
and direct statement of the ultimate
facts on which the plaintiff relies
for his claim.

To determine whether the com-
plaint states a cause of action, all
documents attached thereto may, in
fact, be considered, particularly
when referred to in the complaint.
if the complaint does not state a
cause of action, then no relief can
be granted to the plaintiff and it
would necessarily follow that the
allegations in the complaint would
not warrant a judgment favorable
to the plaintiff.

In the case at bar, the Complaint
sufficiently states a cause of ac-
tion. The following allegations in
the complaint adequately make up
a cause of action for collection of
sum of money against Victoria: (1)
that Victoria and her husband ob-
tained beer and other products on
credit from Brewmaster; and (2)
that they refused to pay despite
demand.

Although it is true that sales in-
voices are not actionable docu-
ments, they were not the bases of
Brewmasters action for sum of
money but were attached to the
Complaint only to provide details
on the alleged transactions.







9

A U G U S T 2 0 1 0 V o l u m e I I I I s s u e N o . 8
At the start of a trial, a lawyer called his first witness to the stand. She seemed like a sweet,
elderly woman. He approached her and asked, "Mrs. Santos, do you know me?"
She responded, "Why, yes, I do know you attorney. I've known you since you were a young
boy. You've become a huge disappointment to me. You lie, you cheat on your wife, you ma-
nipulate people and talk about them behind their backs. You think you are a hot shot law-
yer, when you havent got the brains to realize you never will amount to anything more than
a two-bit paper pusher. Yes, I know you."
The lawyer was stunned. Not knowing what else to do he pointed across the room and
asked, "Mrs. Santos, do you know the defense attorney?"
She replied, "Why, of course I do. I've known him since he was a youngster, too. I used to
baby-sit him for his parents. And he, also, is a real disappointment. He's lazy, bigoted, never
has a nice word to say about anybody, and he drinks like a fish. He's had indecent relation-
ships with so many women, and everybody knows that he charges so much legal fees to his
clients. Yes, I know him."
The judge rapped his gavel, to quiet the tittering among the spectators in the courtroom.
Once the room was silent, he called both attorneys to his bench. In a quiet, menacing voice,
he warned, "If either of you asks her if she knows me, you'll be jailed for contempt!"

JLs Corner
Volume III Issue No. 8
August 2010
LAGUNDI CARONAN AND ASSOCI ATES
DO YOU KNOW
M
E?