Beauty doc Joel Mendez meted 3 years in jail
THE Court of Tax Appeals (CTA) has convicted beauty doctor Joel Mendez for non-filing of Income Tax Return (ITR) for taxable year 2001.
In a 25-page decision penned by Associate Justice Esperanza Fabon-Victorino, the tax court’s Special First Division sentenced Mendez to an indeterminate prison term of one to three years and ordered him to pay P10,000 fine.
“In fine, the prosecution was able to establish the guilt of accused beyond reasonable doubt for violation of Section 255 (Failure to file ITR) of the NIRC (National Internal Revenue Code ), the Tax Court said in a decision promulgated Wednesday.
It dismissed Mendez’ claim that he was not legally obligated to file an ITR as he has no income in 2001.
But the Tax Court said “pieces of evidence reveal that he had been practicing his profession as a doctor offering medical services in his various clinics….”
“Accused even placed several advertisements in the newspaper…The massive and huge advertising campaign covering the print and broadcast media in 200 and 2001 to promote the branches of Weigh Less Center negates accused’ contention that he was not yet in operation in 2001,” the Tax Court added.
Mendez added that the services he performed to celebrity-clients were exchange deals for free commercial plugging.
But the Tax Court pointed out that even assuming that no income was generated in 2001 despite the advertisements, the Tax Code still requires him to file his ITR.
“The said provision explicitly requires every person engaged in trade or business or is in the exercise of his profession, like the accused, to file an ITR and declare income obtained from whatever source, irrespective of whether the income flowed during the taxable period,” the Tax Court said.
“It is the commencement of business or the engagement in the practice of profession that subjects the taxpayer to the requirement of registration and subsequently filing of an ITR…Contrary to accused claim, generation of income is not a condition to the filing of an ITR. The obligation to file an ITR is not dependent on the acquisition of income during the relevant taxable period,” the Tax Court added.
The Tax Court further added that it cannot feign ignorance of his obligation because he was informed on the matter by the Bureau of Internal Revenue (BIR) as confirmed by his own employee.
“He was given not one but several opportunities to submit his accounting records and other business documents to refute if not negate the BIR finding that he failed to file the required 2001 ITR and pay the corresponding tax for income earned for taxable year 2001.”
“But despite notice and opportunity granted, accused failed to take any action on the matter, an indication of his intent to defraud the government,” the Tax Court’s decision read.
The Court however said it cannot impose any civil liability on Mendez because the government prosecutors did not include an assessment by the Commissioner. The Tax Court also added that the evidence presented was for non-filing of ITR.
Mendez was absent during the promulgation. His lawyer said the doctor was suffering from hypertension.
Mendez was previously convicted by the Tax Court’s second division in 2011 for failure to file his tax return for taxable year 2002 and failing to supply the correct and accurate information for taxable year 2003. The January 2011 decision was affirmed by the Tax Court’s en banc (full court). The case is currently with the Supreme Court.
The prosecutors who handled the case are Senior State Prosecutors Susan F. Dacanay and Juan Pedro Navera and Prosecuting Atty Olivia Laroza-Torrevillas.
