Decision
Castro v. Revenue
G.R. No. L-12174 · 1962-04-26 · J.B.L, J. · LawPhil
MARIA B. CASTRO, petitioner, vs. THE COLLECTOR OF INTERNAL REVENUE, respondent. Rosendo J. Tansinsin and Manuel O. Chan for petitioner. Office of the Solicitor General and Special Attorney Librada del Rosario-Natividad for respondent. REYES
J.B.L., J.:
Appeal from a decision of the Court of Tax Appeals (in its C.T.A. Case 141) holding petitioner Maria B. Castro liable under the War Profits Tax Law, Republic Act No. 55, and ordering her to pay a deficiency war profits tax (including surcharges and interest) in the amount of P1,360,514.66, and costs. The background of this case is set forth in great detail in the decision appealed from. We quote: Petitioner Maria B. Castro, who is authorized to manage her own property, is a duly licensed merchant.
Pursuant to the provisions of Section 4 (b) and (c) of Republic Act No. 55, she filed with the Bureau of Internal Revenue on February 28, 1947, her war profits tax returns which showed a net worth on February 26, 1945 in the amount of P431,884.00 and a net worth on December 8, 1941 in the sum of P409,581.57. Although there is indicated an increase in net worth in the amount of P22,302.43, she is totally exempted from paying any war profits tax therefor as the deduction of six per centum (6%) per annum of the net worth on December 8, 1941 therefrom would show only a taxable increase in net worth in the amount of P5,574.61 which is not taxable under the said law. On November 22, 1947, however, Criminal Case No. 4976 was filed against her in the Court of First Instance of Manila for violation of Section 4, in connection with Section 8, of the War Profits Tax Law, for allegedly defrauding the Republic of the Philippines in the total amount of P1,048,687.76.
The criminal action, was filed at the instance of respondent and simultaneous with the filing of said action, the petitioner received for the first time the notice of assessment dated November 19, 1947 by registered mail from the Collector of Internal Revenue. The said letter of demand was based on the report of Supervising Examiner Felipe Aquino of the Bureau of Internal Revenue, who recommended that the petitioner be assessed and made to pay the sum of P1,048,687.76 as war profits tax and surcharge, computed as follows: . Increase in net worth P 885,694.63