Butuan Sawmill, Inc. v CTA; G.R. No. L-20601; 28 Feb 1966

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During the period from 31 January 1951 to 08 June 1953, petitioner sold logs to Japanese firms. Upon ascertainment on 17 September 1957 that petitioner did not file a sales tax return and pay the corresponding tax on the sales, CIR on 27 August 1958 assessed against petitioner tax, surcharge and compromise penalty on its sales of logs for the said period.

Petitioner averred that the filing of its income tax returns, wherein the proceeds of the disputed sales were declared, is substantial compliance with the requirements of filing a sales tax return.

Whether or not the assessment was made within the prescriptive period provided by the law therefor.

YES. The taxpayer must file a return for the particular tax required by law in order to avail himself of the benefits of Section 331 of the Tax Code; otherwise, if he does not file a return, an assessment may be made within the time stated in Section 332(a) of the same Code.

It being undisputed that petitioner failed to file a return for the disputed sales corresponding to the years 1951, 1952 and 1953, and this omission was discovered only on 17 September 1957, and that under Section 332 (a) of the Tax Code assessment thereof may be made within ten (10) years from and after the discovery of the omission to file the return, it is evident that the assessment and collection of the sales tax in question has not yet prescribed.

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