CIR vs.

Avon
GR No. 201398-99, October 3, 2018
Facts:
The respondent filed its income tax return and VAT return for the taxable year
1999. Later on, it executed two waivers of the defense of prescription. Later on, a
collection letter was sent by the petitioner to the respondent which required the latter to
pay approximately P80 million. A preliminary assessment notice was subsequently
issued covering the same deficiency. Respondent protested the assessment. Without
acting upon the protest for the preliminary assessment, the petitioner issued a final
assessment notice which is identical with the previous assessment. Hence, respondent
sent the same protest.
A conference was held and obliged the respondent to pay a part of the
discrepancy so that the petitioner may cancel the assessments. However, after making
the payment, the petitioner continued with the assessment and asserted the liability of
the respondent. Hence, the respondent filed with the CTA a petition for review.
The CTA division partially granted the petition. It stated that the assessment has
already prescribed. Both the petitioner and respondent moved for a reconsideration but
both were denied. The CTA En Banc affirmed the decision when the case was appealed
to it. Hence, the consolidated petition was brought before the Supreme Court. The
respondent contended that it was deprived of due process when the BIR did not act
upon its protest. The BIR, on the other hand, avers that the respondent is estopped
from assailing the assessment because it had paid portions of it.
Issue:
Whether or not AVON was deprived of due process.
Ruling:
Yes.
Under Section 228 of the NIRC, it is required that the assessments, in all stages
of the collection process, should indicated the facts, law, rules and regulations, and
jurisprudence to which the said assessment is based. Also, due process requires that
the parties be given reasonable opportunity to present evidence.
AVON presented several evidence and documents to rebut the said
assessments but the BIR did not appreciate them. There was nothing in the
assessments containing any justification why such protest was not considered. Neither
the evidence presented was not included. The BIR reiterated its previous assessments
without considering the protest of the AVON.
As one of the aspects of due process, the presentation of evidence is not merely
confined with the fact that the party adduced and presented evidence. The evidence
must be considered. The quasi-judicial body must show in its decision the appreciation
of the evidence, whether it is given probative value or not.