The Supreme Court. INQUIRER FILE PHOTO
MANILA, Philippines—The Supreme Court denied the appeal filed by the Bureau of Internal Revenue (BIR) to gain access to the Statement of Assets, Liabilities and Networth (SALN) of the high court, Court of Appeals and Court of Tax Appeals Associate Justices saying the law does not authorize ‘fishing expedition.’
BIR wants SALN copies from 2003 to 2012.
In its motion for reconsideration, BIR cited its duty stated under the Tax Code which includes to: (a) ascertain the correctness of a return; or (b) in making a return when none has been made; or (c) in determining the liability of any person for any internal revenue tax; or (d) in collecting on any such liability; or (e) in evaluating tax compliance.
But the high court said the cited provision “does not authorize the acquisition of any information or an investigation prior to an assessment of tax deficiency and that it should never be construed to authorize the conduct of a fishing expedition to hunt for any supposed tax liability.”
The high court said the powers given to the BIR to investigate is not absolute.
Under the National Internal Revenue Code (NIRC), specifically section 203, provides a three-year limit imposed for the assessment of internal revenue taxes while Section 222 extends the period to assess deficiency taxes to 10 years in cases when there is a false or fraudulent return with intent to evade tax or the non-filing of a tax return.
The BIR, according to the high court’s ruling, failed to allege in particularity who she seeks to investigate; she had not given notice to those supposedly being investigated that they are being accused of fraud.
The high court added that the request is silent on the facts and the law on which the agency has based the finding of fraud to justify the application of the 10-year prescriptive period.
“Because fraud is never presumed and must be alleged and proven, the Court found it incredulous that the CIR seems to imply that all the justices of the high court, Court of Appeals, Court of Tax Appeals are being investigated for tax fraud,” the high court said.
The high court also noted that they find it curious that while the Commissioner of Internal Revenue “claimed that her interest was to ensure tax compliance by members of the judiciary, she showed no interest to seek the SALNs of the other members of the judiciary like those in the Sandiganbayan or the first level courts…Her request is limited to those belonging to the Supreme Court, the Court of Appeals and the Court of Tax Appeals, all tribunals exercising jurisdiction over cases involving her office.”
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