LAW OF BASIC TAXATION IN PHILIPPINES. (2) When the tax or any portion thereof appears to be unjustly or excessively assessed; or 0) When he administration and oletion costs involved do not justify the collection of the amount ec asi tt due (See. 204/B), 1997 3. Compromise of Criminal Violations - All criminal violations may be compromised except (#) Those already filed in court; and (©) Those involving fraud Insofar as compromises are concerned, and pursuant to See 1997 NIRC, Revenue Regulations No. 12-99, dated Sept, 6, 1998, provides that “in general, the taxpayer's criminal liability arising from his violation of the pertinent provision of the Code may be settled extra-judicially instead ofthe BIR instituting against the taxpayer a criminal action in Court. A compromise in extra-judicial settlement of the taxpayer's criminal liability for his violation is consensual in character, hence, may not be imposed on the taxpayer without his consent, Hence, the BIR may only suggest settlement ofthe taxpayer's liability through a compromise.” Itis further mandated that the extra. judicial settlement ofthe taxpayer's criminal liability and the amount ‘of the suggested compromise penalty shall conform with the schedule of compromise penalties provided under the relevant BIR regulations or orders, 4. Delegation of the Power to Compromise - ‘The power to compromise or abate, under Sec. 204(A) and (B) of the 1997 NIRC shall not be delegated by the Commissioner; provided, however, that assessments issued by the regional offices involving basic taxes of five hundred thousand pesos (500,000) or less, and minor criminal Violations, as may be determined by rules and regulations to be promulgated by the Secretary of Finance, upon recommendation of the Commissioner, may be compromised by a regional evaluation board which shall be composed of the Regional Director as chairman, the Assistant Regional Director, the heads of the Legal, Assessment and Collection Divisions and the Revenue District Officer having jurisdiction over the taxpayer, as members (Sec. 7, 1997 NIRC). Incidentally, if the taxpayer fails to abide by the compromise arrangement, the Government could either insist on the collect the compromised sum, or disregard the compromise and collect the original tax due. 5. Power to Compromise Not Absolute - May a case still be compromised even after final judgement? This question was answered 236 TAX REME REMEDIES OF THE GOVERNMENT \egative in Rovero v. Amparo, etc., et al. (91 Phil. 228). In the Government won and a fine was imposed based on the appraisement of certain jewelry. However, later on, the joner of Customs, with the approval of the Department of e, ordered a reappraisal of the article in question and entered toa compromise, The Supreme Court, however, ruled that the ‘compromise was improper because as a mere agent of the Government, the Commissioner of Customs is not authorized to accept anything ws than what is adjudicated in favor of the Government. By virtue of al judgment, the Government had already acquired a vested right 6, Nature of Compromise Penalty - A compromise penalty is a certain amount of money which the taxpayer pays to compromise a ax violation. As previously pointed out, this is paid in lieu of a criminal rosecution. ‘A compromise implies mutual agreement. Hence, compromise penalties cannot be imposed in the absence of a showing that the payer consented thereto. If the Commissioner's offer of compromise rejected by the taxpayer, the Commissioner cannot enforce it but he ay file a criminal action against the taxpayer for the tax violation. (Collector of Internal Revenue v. University of Santo Tomas, et al., 104 Phil. 1062 [Unrep.]; Commissioner of Internal Revenue v. Fireman’s Fund Insurance Co., et al., L-30644, Mar. 9, 1987). The Commissioner has no power to impose and collect the so-called ‘compromise penalties in the absence of a compromise agreement validly entered into between the taxpayer and the Commissioner (Mithi ng Bayan Cooperative Marketing Ass'n Inc. v. Araneta, CTA Case No. 79, Aug. 14, 1958; affirmed in G.R. L-14575, July 31, 1961). ‘Asa pointed out earlier, compromise penalties being voluntary in character, they may be collected only if the taxpayer is willing to pay them, However, where in an appeal to CTA, the taxpayer has expressed his willingness to pay compromise penalties, said amounts may be lected as part of the judgment (Commissioner of Internal Revenue v, Guerrero, et al., L-19074 and L-19089, Jan. 31, 1967). ‘Suppose the taxpayer reneges on his conformity to the payment of the suggested compromise, may the Commissioner collect the compromise penalty thru an action in court by distraint and levy? ‘A collection action does not lie because a compromise penalty is neither tax nor an administrative penalty for tax delinquency, COLLECTION BY DISTRAINT AND LEVY. Distraint and levy are remedies in tax collection which run parallel, in point of importance, 237