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G.R. No. L-39910|September 26, 1988|1st Division|GANCAYCO|Rule 65|Remedies Effect of Failure to File Protest| fgdlj
DOCTRINE: From the date of reception of assessment, the taxpayer must appeal w/in 15 days to CTA in order for the
assessments to remain disputed and will not become final and executory.
CASE SUMMARY: Spouses Teodoro died. Dayrit et al were their heirs. They filed estate proceedings of their parents’ estate.
CIR issued assessments to the estates. They failed to file a position paper for the reconsideration of the assessments and they
filed to timely appeal to CTA. CIR filed a claim with the estate court w/c allowed the same. SC affirmed the allowance.
FACTS:
Cecilia Teodoro Dayrit, Toribia Teodoro Castaneda, Prudencio Teodoro, Francisco Teodoro, and Josefina Teodoro
Tiongson are the legitimate children and heirs of the deceased spouses Marta J. Teodoro who died intestate and Don
Toribio Teodoro who died testate (both 1965).
The heirs filed separate estate and inheritance tax returns for the estates of the late spouses with BIR.
Intestate and testate proceedings were filed by Dayrit in CFI Caloocan and she was appointed administrator and
executor.
CIR issued deficiency estate and inheritance tax assessments and were received by Dayrit:
Estate of Dona Marta Estate of Don Toribio
Estate Tax & penalties P1,662,072.34 P1,542,293.01
Inheritance Tax & interests 1,747,790.94 P1,518,458.72
Dayrit et al asked for reconsideration and requested 30 days w/in w/c to file their position paper.
o No position paper was filed.
FEM signed PD23 (1972) "Proclaiming Tax Amnesty Subject to Certain Conditions" and subsequently, PD67 amended
PD23 thus providing that:
o In all cases of voluntary disclosure of previously untaxed income and/or wealth such as earnings, receipts,
gifts, bequests or any other acquisitions from any source whatsoever which are taxable under NIRC
realized here or abroad by any taxpayer, the collection of taxes, civil and criminal liabilities are condoned and in
lieu thereof a tax of 10% on such previously untaxed income or wealth is imposed on the ff conditions:
a. Such previously untaxed income and/or wealth must have been earned or realized prior to 1972;
b. The taxpayer must file a return with the Commissioner of Internal Revenue on or before March 31,
1973, showing such previously untaxed income and/or wealth;
In a tax return dated March 31, 1973, Dayrit declared an additional amount of P3,655,595.78 as part of the estates
of the Teodoro spouses, for additional valuation over and above the amount declared in the previous return for estates
and inheritance taxes of the said late spouses.
o BIR issued tax payment acceptance order thus the estates and heirs of the deceased spouses paid P5T,
P30,046.68 and P250T per ORs totaling to P285,046.68.
CIR filed a motion for Allowance of Claim against the estates of spouses and for an order of payment of taxes
amounting to P6,470,396.81 plus surcharges and interest.
o Dayrit filed 2 oppositions alleging that the taxes were settled pursuant to PD67and that the assessments have not
become final and executory.
o In reply, CIR alleged that they could not avail of the tax amnesty in view of the existence of a prior assessment.
o Dayrit insisted that they could avail of tax amnesty invoking Section 4, BIR Revenue Regulation No. 8-72.
Judge approved the CIR claim and directed payment thereof.
W/N an estate may avail of tax amnesty under PD23 where there is already an existing assessment made prior to
the issuance of the said decree on the basis of the submitted estate and inheritance tax returns by merely filing
separate estate tax returns of an undeclared and untaxed income over and above the original amount of the estate
declared. NO
PD23, in order to avail of tax amnesty, requires a voluntary disclosure of a previously untaxed income.
o In addition thereto, said income must have been earned or realized prior to 1972 and the tax return must be filed
on or before March 31, 1973.
o Considering that P.D. No. 23 was issued on October 16, 1972, the court rules that the said decree
embraces only those income declared in pursuance thereof within the taxable year 1972.
o The time frame cannot be stretched to include declarations made prior to the issuance of the said decree or those
made outside of the time frame as envisioned in the said decree.
o Thus, the estates of the Teodoro spouses which have been declared separately sometime in the 1960's
are clearly outside the coverage of the tax amnesty provision.
MODIFICATION: Thus, if at all, it is only the estates in the amount of P3,655,595.78 declared pursuant to P.D. No. 67
that is covered, upon payment of 10% of the said amount within the period prescribed under P.D. No. 23, which was up
to June 30, 1973.
Considering that there has been partial compliance with the said requirement by the payment of P285,046.68, petitioner
may claim the benefit of amnesty for said declared amount upon payment of the balance of 10% thereof required to be
paid.
NOTES: