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[ G.R. No. 140488. January 24, 2000]

CIR vs. ATLAS CONSOLIDATED MINING AND DEVELOPMENT CORP.

SECOND DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated JAN 24 2000.

G.R. No. 140488 (Commissioner of Internal Revenue vs. Atlas Consolidated Mining and Development Corporation.)

This is a petition for review on certiorari of the decision, dated September 30, 1999, of the Court of Appeals, affirming the decision, dated May 3, 1996, of the Court of Tax Appeals. The Court of Tax Appeals reversed the decision, dated may 23, 1990, of petitioner Commissioner of Internal Revenue denying the letter-protest of respondent Atlas Consolidated Mining & Development Corporation.

It appears that petitioner issued an assessment letter, dated April 12, 1985, against respondent demanding payment of delinquent taxes in the amount of P40,691,335.85 for the year 1979. In response to the said assessment letter, respondent filed a letter-protest on May 13, 1985, which petitioner denied in a decision, dated May 23, 1990. Respondent appealed to the Court of Tax Appeals, which reversed the decision of petitioner. The Court of Tax Appeals held that petitioner could no longer enforce the assessment letter because of prescription. The Court of Appeals affirmed the decision of the Court of Tax Appeals.

Petitioner alleges that, as respondent filed a letter-protest from the assessment letter, the period within which petitioner may collect delinquent taxes by distraint, levy, or court proceeding was suspended until the letter-protest was denied in May 23, 1990. Hence, petitioner can still enforce the assessment letter as prescription has not yet set in.

The petition has no merit. Under the then �319 of the National Internal Revenue Code, petitioner may collect delinquent taxes by distraint, levy, or court proceeding within five years of the issuance of the assessment letter. In the instant case, the assessment letter was issued on April 12, 1985, but, on May 23, 1990, when petitioner denied the letter-protest of respondent, petitioner had not commenced any action to enforce the assessment letter. Under � 319 of the National Internal Revenue Code, petitioner may collect delinquent taxes by distraint, levy, or court proceeding beyond the original five-year period only if he had entered into a written agreement with the taxpayer regarding an additional period for collection. However, the three waivers of the statute of limitation signed by Zoilo V. Castillo, Jr., the Senior Vice President and Assistant Treasurer of respondent, were not signed by petitioner. Revenue Memorandum Order No. 20-90 requires that waivers must be signed by the Commissioner of Internal Revenue or the revenue officer authorized by him as proof that the BIR has agreed to the waiver.

It has been held that a taxpayer cannot set up the defense of prescription even if he has not previously waived it in writing, as when he requests the postponement of the collection. 1 Colector of Internal Revenue vs. Suyoc Consolidated Mining Company, 104 Phil. 819 (1958). Significantly, in the instant case, respondent categorically stated in its letter-protest dated May 13, 1985 that it is not requesting for "reconsideration or reinvestigation or a plea for accommodation in any sense." Thus, the prescriptive period was not suspended, as there was nothing to prevent petitioner from collecting the delinquent taxes by distraint, levy, or court proceeding. Hence, the Court of Appeals correctly upheld the finding of the Court of Tax Appeals that petitioner can no longer enforce the assessment letter issued against respondent.

WHEREFORE, the petition is DENIED for lack of merit.

* The manifestation, dated January 10, 2000, of counsel for petitioner is NOTED.

Very truly yours,

(Sgd.) TOMASITA M. DRIS

Clerk of Court

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