Bank of the Philippine Islands v CIR; G.R. No. 139736; 17 Oct 2005

in Legal Chyme by

On 10 October 1989, the BIR issued an assessment against petitioner finding the latter liable for deficiency documentary stamp tax (DST) on its 1985 sales of US currency to the Central Bank of the Philippines. Petitioner in a letter protested against the assessment, requesting for reconsideration.

Petitioner did not receive any immediate reply to its protest letter. The BIR on 23 October 1992 served petitioner a Warrant of Distraint and/or Levy for the assessed deficiency DST for taxable year 1985. On 11 September 1997, respondent received a letter dated 13 August 1997 and signed by respondent denying petitioner’s request for reconsideration.

Whether or not respondent’s right to collect the deficiency DST was barred by prescription.

YES. The running of the prescriptive period for collection of taxes can only be suspended by a request for reinvestigation, not a request for reconsideration. Even if, for the sake of argument, petitioner’s protest is considered a request for reinvestigation, it could not have suspended at once the running of the statute of limitations because such request was not granted. Petitioner was left in the dark as to the status of its protest in the absence of any word from the BIR.

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