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COURT OF TAX APPEALS

(RA 1125)
by Anna Alyssa J. Robledo
Report Outline

• INTRODUCTION • EVIDENCE
o Review on jurisdiction of
courts • SUBJECT OF APPEAL
o Nature of the CTA
• TIME TO APPEAL
o Powers of the CTA
• Criminal cases
o Composition and
Appointment of members • Civil cases

• JURISDICTION OF • APPEAL AFTER CTA


THE CTA o Remedies available

o CTA en banc

o CTA en division
Court Jurisdiction

• BP 129
o MTC
o RTC
o CA
Jurisdiction
MTC 1) Forcible entry and unlawful detainer

RTC 2) Title to or possession of real prop. or any interest


therein
• Outside MM - exceeds 20,000
• Within MM - exceeds 50,00

FC 3) Petitions for adoption of children and revocation


thereof

RTC, CA, SC 4) Petitions for habeas corpus and quo warranto

RTC 5) Actions where subject matters are not capable of


pecuniary estimations.
Republic Act No. 1125
• An Act Creating the Court of Tax
Appeals
o June 16, 1954
o Had only 3 Judges
o 1 division
• Amended by
o RA 9282
o RA 9503
Nature of CTA
• Highly specialized body created for the
purpose of reviewing tax cases
• Jurisdiction is special or limited
• Proceedings are judicial in nature (although
not bound by the technical rules of
evidence)
• Procedure is governed by the Revised Rules
of the CTA (Rules of Court have suppletory
application)
Powers of the CTA
• Issue subpoena duces tecum
• Punish contempt
• Issue subpoena ad testificandum
• Suspend collection of tax pending appeal
• Issue order authorizing distraint of personal
property or levy of real property
• Administer oaths
• Promulgate rules and regulations for the
conduct of its business
Powers of the CTA
• Receive evidence

• Assess damages against appellant if appeal to


CTA is found frivolous or dilatory

• Render decisions on cases brought before it

• Issue writs of prohibition and injunction (CIR


vs. Yuseco)
Composition and Appointment of
CTA Members
• 9 members: 1 Presiding Justice, 8 Associate
Justices

• Appointed by the President upon nomination by


the JBC

• It may sit En banc, or in 3 divisions, each


division of 3 members

• Presiding justice and the 2 most senior


Associate Justices shall serve as chairperson of
the 3 divisions
Composition and Appointment of
CTA Members
En Banc
 Reversal of a decision of a Division: 5
affirmative votes is necessary
 Any other resolution/decision: simple majority
of justices present (R.A. 9503, Sec. 2)

Division
 Only a simple majority of the justices present is
required to promulgate a resolution or decision
(R.A. 9503, Sec. 2)
Composition and Appointment of
CTA Members

Quorum
Sessions: Decisions:
presence Affirmative
votes
En banc 5 justices 5 justices

Division 2 justices 2 justices


Composition and Appointment of
CTA Members

• When the necessary majority vote


cannot be had:
o Petition: dismissed
o Appealed cases: judgment / order
appealed from shall stand affirmed
o Incidental matters:
petition/motion shall be denied
(RRCTA Rule 2, Sec. 3)
CTA Jurisdiction
CTA en banc
 Reversal of a decision of a
Division:
• 5 affirmative votes is necessary
 Any other resolution/decision:
• simple majority of justices present
(R.A. 9503, Sec. 2)
Exclusive Original Jurisdiction of
CTA en banc

• Shall sit en banc in the exercise of its:


o Administrative
o Ceremonial
o Non-adjudicative functions
Exclusive Appellate Jurisdiction
of CTA en banc
A) Decisions or resolutions on Motions for
Reconsideration or New Trial of the court in division in
the exercise of its exclusive appellate jurisdiction
over:
1. Cases arising from administrative agencies:
 BIR
 BOC
 DOF
 DTI
 DA
2. Local tax cases decided by the RTC in the exercise of
their original jurisdiction; and
Exclusive Appellate Jurisdiction
of CTA en banc
Decisions or resolutions on Motions for
Reconsideration or New Trial of the court
in division in the exercise of its exclusive
appellate jurisdiction over:
3. Tax collection cases decided by the RTCs in
the exercise of their original jurisdiction
involving final and executory assessments
for taxes, fees, charges and penalties,
where the principal amount of taxes and
penalties claimed is less than 1 million
pesos;
Exclusive Appellate Jurisdiction
of CTA en banc
B) Decisions or resolutions or orders of the
RTCs decided or resolved by them in the
exercise of their appellate jurisdiction over:
1. Local tax cases
2. Tax collection cases where the principal
amount of taxes and fees, exclusive of
charges and penalties claimed is less than 1
million
3. Criminal offenses arising from violations of the
NIRC or Tariff Code and other laws
administered by the BIR or BOC
Exclusive Appellate Jurisdiction
of CTA en banc
C) Decisions, resolutions or orders on motions for reconsideration or
new trial of the Court in Division in the exercise of its exclusive original
jurisdiction over tax collection cases

D) Decisions of the CBAA

E) Decisions, resolutions or orders on motion for reconsideration or new


trail of the Cout in Division in the exercise of its exclusive original
jurisdiction over cases involving criminal offeses arising from violations
of the NIRC or the TCC and other laws administered by the BIR or BOC

F) Decisions, resolutions or orders on motions for reconsideration or new


trial of the Court in Division in the exercise of its exclusive appellate
jurisdiction over criminal offenses mentioned in the preceding
subparagraph

G) Decisions, resolutions or orders of the RTC in the exercise of their


appellate jurisdiction over criminal offenses mention in subparagraph
(F)
CTA in division
 Only a simple majority of the
justices present is required to
promulgate a resolution or
decision (R.A. 9503, Sec. 2)
Exclusive Original Jurisdiction
of CTA in division
1. Criminal Offenses arising from violations of
the NIRC or TCC and other laws
administered by the BIR or BOC, where the
principal amount of taxes and fees,
exclusive of charges and penalties, claimed
is one million pesos or more (Sec. 3[b][1])
2. Tax collection cases cases involving final
and executory assessments for taxes, fees,
charges and penalties, where the principal
amount of taxes and fees, exclusive of
charges and penalties, claimed is one
million pesos or more; and (Sec. 3[c][1])
Exclusive Appellate Jurisdiction
of CTA in division
1. Decisions or inaction by the CIR
where the NIRC provides a specific
period of action
a. In cases involving disputed assessments, refunds,
or internal revenue taxes, fees, or other
charges, penalties in relation thereto; or other
matters arising under the NIRC or other laws
administered by the BIR
b. or other matters arising under the NIRC
or other laws administered by the BIR;
Exclusive Appellate Jurisdiction
of CTA in division
2. Decisions of the Commissioner of
Customs
a) In cases involving liability for customs
duties, fees or other money charges,
seizure, detention or release of property
affected, fines, forfeitures of other
penalties in relation thereto, or
b) Other matters arising under the Customs
Law or other laws administered by the
Bureau of Customs
Bar Question (2000)
On the basis of a warrant of seizure and
detention issued by the Collector of Customs for the
purpose of enforcing the Tariff and Customs Laws,
assorted brands of cigarettes said to have been
illegally imported into the Philippines were seized
from a store where they were openly offered for
sale. Dissatisfied with the decision rendered after
hearing by the Collector of Customs on the
confiscation of the articles, the importer filed a
petition for review with the Court of Tax Appeals.
The Collector moved to dismiss the petition for lack
of Jurisdiction. Rule on the motion. (2%)
Bar Question (2000)
SUGGESTED ANSWER:

Motion granted. The Court of Tax Appeals has


jurisdiction only over decisions of the
Commissioner of Customs in cases involving
seizures, detention or release of property
affected. (Sec. 7, R.A. No. 1125). There is no
decision yet of the Commissioner which is
subject to review by the Court of Tax Appeals.
Exclusive Appellate Jurisdiction
of CTA in division
3. Decisions of the Secretary of
Finance on customs cases elevated to
him automatically for review from
decisions of the Commissioner of
Customs adverse to the Government
under Section 2315 of the Tariff and
Customs Code
Exclusive Appellate Jurisdiction
of CTA in division
4. Decisions of the Secretary of Trade and
Industry, in the case of nonagricultural
product, commodity or article, and the
Secretary of Agriculture, in the case of
agricultural product, commodity or article,
involving dumping and countervailing duties
under Section 301 and 302, respectively, of
the Tariff and Customs Code, and safeguard
measures under Republic Act No. 8800,
where either party may appeal the decision
to impose or not to impose said duties
Exclusive Appellate Jurisdiction
of CTA in division
5. Judgments, resolutions or orders of the
Regional Trial Courts in their original
jurisdiction in criminal offenses arising from
violations of the National Internal Revenue
Code or Tariff and Customs Code and other
laws administered by the Bureau of Internal
Revenue or Bureau of Customs, where the
principal amount of taxes and fees, exclusive
of charges and penalties, claimed is less than
one million pesos or where there is no
specified amount claimed
Exclusive Appellate Jurisdiction
of CTA in division
6. Judgments, resolutions or orders of
the Regional Trial Courts in tax
collection cases decided by them in
the exercise of their original
jurisdiction
Exclusive Appellate Jurisdiction
of CTA in division
7. Appeals from the judgments,
resolutions or orders of the RTCs in
tax collection cases where the
principal amount of taxes and fees,
exclusive of charges and penalties,
claimed is less than 1 million
Evidence
Burden of proof is on the taxpayer on appeal to prove
by full disclosure of data in his possession and to prove
not only that the one who rendered the assailed
decision is wrong but the taxpayer is right.
The CTA may receive evidence in
the following cases:
1. In all cases falling within the original
jurisdiction of the CTA in Division pursuant to
Sec. 3, Rule 4 of the RRCTA

2. In appeals in both civil and criminal cases


where the Court grants a new trial pursuant to
Sec. 2, Rule 53, and Sec. 12, Rule 124 of the
Rules of Court

(RRCTA, Rule 12, Sec. 2)


Taking of Evidence:
1. By a Justice of the CTA
• Motu propio or upon motion, when:
a) The determination of a question of fact
arises at any stage of the proceedings;
or
b) The taking of an account is necessary
c) The determination of an issue requires
the examination of a long account
Taking of Evidence:
2) By a Court Official
a) Clerk of Court
b) Division Clerk of Court
c) Their assistants who are members of the
Philippine Bar
d) Court Attorney

*Applies only in default or ex parte


hearings, or where the parties agree in
writing
What To Appeal
Subject of appeal
Only a FINAL decision is
appealable to the CTA in division
 When it constitutes the final action
taken by him or his authorized
deputies with respect to the
taxpayer’s liability
 Commissioner must state that his
decision is final for the period of
appeal to run
Final decision or not?
YES 1. Action taken by Commissioner in response to a
protest

YES 2. An exchange of communication between the CIR


and taxpayer, where the CIR states that decision is
final

YES 3. A demand letter for tax deficiency issued and signed


by an authorized person with the warning that failure
to pay would result to the issuance of warrant of
distraint and levy without further notice

NO 4. Preliminary collection letters, post reporting notices,


and pre-assessment

YES 5. A letter of CIR reiterating previous demand to pay


assessment

YES 6. Issuance FLD/FAN


Allied Banking Corporation v. CIR
(GR No. 175097)
FACTS:
• Preliminary Assessment Notice (PAN) for
deficiency Documentary Stamp Tax
• Formal Letter of Demand (FLD) with
assessment notices which reads:
• “It is requested that the above deficiency tax
be paid immediately upon receipt hereof,
inclusive of penalties incident to
delinquency. This is our final decision based
on investigation. If you disagree, you may
appeal the final decision within thirty (30)
days from receipt hereof, otherwise said
deficiency tax assessment shall become final,
executory and demandable.”
Allied Banking Corporation v. CIR
(GR No. 175097)
FACTS:
• Petition for review to CTA First Division
• Denied for failure of petitioners to file an
administrative protest on the FLD
• Appealed to CTA en banc
o Denied again: “absolutely necessary to file an
administrative protest in order for the CTA to
acquire jurisdiction”
Allied Banking Corporation v. CIR
(GR No. 175097)
ISSUE:

• Whether or not the FLD can be construed as a final


decision of the CIR appealable to CTA under RA 9282

RULING:

 GRANTED! Exception to the rule of exhaustion of


administrative remedies (estoppel on the part of the
administrative agency)

 CIR appeared to have made a final decision on the


matter and that the proper remedy is to appeal the
final decision within 30 days
Allied Banking Corporation v. CIR
(GR No. 175097)
RULING:
 CIR used the word “APPEAL”
instead of protest, reinvestigation,
or reconsideration, and “FINAL
DECISION”
 Any doubt should be resolved in
favor of petitioner not respondent
who caused the confusion
 FAN that should be protested or
disputed within 30 days not the
PAN
The key to effective
communication is
CLARITY.
Tenor of Finality Rule:
Where several requests for
reconsideration are filed, the
appealable decision is that which
affirms the finality of the action
taken by the CIR (Reyes vs. CIR).
When To Appeal
Period within which to file Appeal to CTA
Civil Cases
• CTA in division
• Within 30 days after receipt of the
decision of the BIR Commissioner
o Failure of the Commissioner to act on
the protest within 180 days, 30 days
(after the lapse of 180 days)
o Motion for Reconsideration of the
denial of administrative protest does
not toll the 30-day period to appeal to
the CTA
Civil Cases
• CTA en banc
• Within 15 days from the receipt of the
decision of the CTA in division on Motion
for Reconsideration or New Trial
o Motion for Reconsideration and New Trial
is a condition precedent before bring the
case to the CTA en banc
• Within 30 days from receipt of the
questioned decision of the ruling of
CBAA and RTC in the exercise of its
appellate jurisdiction
Criminal Cases
• RTC (original jurisdiction)
– within 15 days
• RTC (appellate jurisdiction
- within 15 days (petition for review via Rule 43)

• CTA in division (to CTA en banc)


– within 15 days

• CTA en banc
– within 15 days (petition for review via Rule 43)
* Institution of the criminal action shall interrupt the
running of the period of prescription
Finding of fact of CTA not
reviewable
• Considered as an expert on the
subject, unless there has been an
abuse or improvident exercise of
authority
• Exception: if supplied by substantial
evidence or there is a showing of
gross error or abuse on part of CTA
Remedies of the party affected
by the CTA decision
• CTA in division (ruling, order or decision)
 File a Motion for Reconsideration or New Trial
before the same division within 15 days from
notice

• CTA in division (resolution on the Motion for


Reconsideration or New Trial)
 File a petition for review with the CTA en banc

• CTA en banc
 File with the Supreme Court a verified petition for
review on certiorari within 15 days via Rule 45
GENERAL RULE:
Once a decision becomes final and
executory, it cannot be altered or
modified.
EXCEPTIONS:
1. In some cases where facts or events transpire
after a decision has become executory, which
acts constitute a supervening cause rending
the final judgment unenforceable
2. The execution of the final judgment becomes
impossible or unjust
Pag sinabi na wala na talaga,
wala na talaga.
Final and executory na yan.

EXCEPTIONS?
Thank you!