Tag: Final Assessment

Defining ‘Final Assessment’: Seafarer Disability Benefits and Employer Obligations

In Jerry Bering Talaugon v. BSM Crew Service Centre Phils., Inc., the Supreme Court clarified the requirements for a company-designated physician’s assessment of a seafarer’s disability to be considered final and definitive. The Court ruled that a medical assessment must not only be issued within the prescribed 120/240-day period but must also provide a comprehensive and conclusive evaluation of the seafarer’s condition, including an explanation of the treatment progress and the expected recovery period. This decision protects seafarers by ensuring they receive appropriate disability benefits when assessments are incomplete or fail to accurately reflect their capacity to return to work, reinforcing the obligation of employers to provide thorough medical evaluations.

Beyond the Deadline: When is a Seafarer’s Medical Assessment Truly ‘Final’?

The case revolves around Jerry Bering Talaugon, a seafarer employed as an oiler, who suffered from a spinal cord tumor during his employment. After undergoing surgery and treatment, the company-designated physician issued a Grade 11 disability rating within the 120-day period following his repatriation. However, Talaugon argued that this assessment was not final and definitive, entitling him to permanent total disability benefits. The core legal question is whether the company-designated physician’s assessment was sufficient to meet the requirements of the Philippine Overseas Employment Administration Standard Employment Contract (POEA-SEC) and relevant jurisprudence.

The Supreme Court emphasized that merely issuing a disability grading within the 120/240-day period is insufficient. The assessment must be final and definitive, reflecting the true extent of the seafarer’s illness or injury and their capacity to resume work. The Court referred to Section 20(B) of the POEA-SEC, which outlines the employer’s liabilities for work-related injuries or illnesses. It is the company-designated physician’s primary responsibility to determine the disability grading or fitness to work of seafarers. To be conclusive, medical assessments or reports must be complete and definite to accurately reflect the true extent of the seafarer’s injuries and their ability to return to work. A vague or tentative assessment does not fulfill this requirement.

Section 20. COMPENSATION AND BENEFITS.

B. COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS The liabilities of the employer when the seafarer suffers work-related injury or illness during the term of his contract are as follows:

2. xxx

However, if after repatriation, the seafarer still requires medical attention arising from said injury or illness, he shall be so provided at cost to the employer until such time he is declared fit or the degree of his disability has been established by the company-designated physician.

In this case, the Medical Report dated May 15, 2014, stated that “the prognosis of returning to (his) sea duties is guarded” and suggested a Grade 11 disability rating. The Court found this assessment to be lacking because it did not provide a detailed explanation of the progress of Talaugon’s treatment or the approximate period needed for him to fully recover. The assessment was deemed indefinite and inconclusive.

The Court contrasted the situation with prior cases where definitive assessments were made. In Carcedo v. Maine Marine Phils., Inc., the Court ruled that the company-designated physician’s disability assessment was not definitive since the seafarer continued to require medical treatments thereafter. Similarly, in Island Overseas Transport Corp. v. Beja, the Court considered the partial disability grading as tentative because the seafarer continued physical therapy sessions beyond 240 days, and the physician did not explain how the assessment was reached.

Building on this principle, the Court found in Orient Hope Agencies Inc. v. Jara, that the medical report lacked any definitive declaration as to the seafarer’s fitness to work and that the seafarer was still complaining of pain during his last check-up. The Court reasoned that without a final and definitive assessment, Talaugon’s disability is deemed permanent and total by operation of law. The assessment’s lack of clarity rendered it insufficient under the POEA-SEC guidelines, tilting the scales in favor of the seafarer.

Furthermore, the Court underscored that disability compensation focuses on the incapacity to work resulting in the impairment of one’s earning capacity, rather than merely the injury itself. Total disability refers to an employee’s inability to perform their usual work, and permanent disability is the inability to perform the job for more than 120 or 240 days, regardless of whether they lose the use of any part of their body. In Talaugon’s case, his persistent back pain made it highly improbable for him to perform his usual tasks as an oiler, leading to a loss of earning capacity.

Therefore, the Court concluded that Talaugon was entitled to permanent total disability benefits. The Court reversed the Court of Appeals’ decision and ordered the respondents to pay Talaugon US$60,000.00 as permanent and total disability benefits, along with attorney’s fees equivalent to ten percent of this amount. A legal interest of 6% per annum was imposed on the total judgment award from the finality of the Decision until fully paid.

This ruling has significant implications for seafarers and their employers. It clarifies the standard for what constitutes a final and definitive medical assessment, emphasizing the need for thorough and conclusive evaluations by company-designated physicians. It reinforces the seafarer’s right to compensation that reflects their inability to return to work and provides a clearer framework for resolving disputes over disability benefits.

FAQs

What was the key issue in this case?	The key issue was whether the company-designated physician’s assessment of the seafarer’s disability was final and definitive, entitling him to permanent total disability benefits.
What is the required period for a company-designated physician to make an assessment?	The company-designated physician must issue a final medical assessment within 120 days from the time the seafarer reported, extendable to 240 days if further medical treatment is required.
What happens if the company-designated physician fails to make an assessment within the prescribed period?	If the company-designated physician fails to provide an assessment within the 120/240-day period without justification, the seafarer’s disability becomes permanent and total by operation of law.
What constitutes a final and definitive assessment?	A final and definitive assessment must be complete, providing a detailed explanation of the seafarer’s condition, the progress of treatment, and the expected period for recovery. It should reflect the true extent of the seafarer’s illness or injury and their capacity to resume work.
What if the assessment is vague or tentative?	If the assessment is vague or tentative, it does not meet the requirements of the POEA-SEC, and the seafarer’s disability may be deemed permanent and total.
What is the basis for disability compensation?	Disability compensation is based on the seafarer’s incapacity to work and the resulting impairment of their earning capacity, rather than solely on the injury itself.
What is considered total and permanent disability?	Total disability is the employee’s inability to perform their usual work, while permanent disability is the inability to perform the job for more than 120 or 240 days.
What was the Supreme Court’s ruling in this case?	The Supreme Court ruled in favor of the seafarer, holding that the company-designated physician’s assessment was not final and definitive, and thus the seafarer was entitled to permanent total disability benefits.

The Talaugon case underscores the importance of clear, comprehensive medical assessments in seafarer disability claims. Moving forward, employers and company-designated physicians must ensure that evaluations are not only timely but also provide a thorough understanding of the seafarer’s condition and prognosis. This will ensure fair compensation and support for seafarers who have suffered work-related injuries or illnesses.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Jerry Bering Talaugon v. BSM Crew Service Centre Phils., Inc., G.R. No. 227934, September 04, 2019

September 4, 2019

Due Process in Taxation: Assessments Voided for Ignoring Taxpayer Evidence

In a landmark decision, the Supreme Court ruled that tax assessments issued by the Bureau of Internal Revenue (BIR) are null and void if they violate a taxpayer’s right to due process. This means the BIR must genuinely consider all evidence and arguments presented by taxpayers, not just issue assessments based on presumptions. This ruling protects taxpayers from arbitrary tax demands and ensures fair treatment under the law.

Ignoring Evidence, Inflating Assessments: Avon’s Fight for Due Process

This case involves consolidated petitions concerning tax assessments issued by the Commissioner of Internal Revenue (Commissioner) against Avon Products Manufacturing, Inc. (Avon) for the taxable year 1999. Avon contested these assessments, arguing that the Commissioner failed to observe administrative due process by ignoring its protests and submissions. The core legal question is whether the Commissioner violated Avon’s right to due process, thereby rendering the tax assessments void.

The facts reveal that Avon filed its Value Added Tax (VAT) returns and Monthly Remittance Returns of Income Tax Withheld for the taxable year 1999. Subsequently, Avon signed two Waivers of the Defense of Prescription, which extended the period for the BIR to assess taxes. However, on July 14, 2004, Avon received a Collection Letter demanding payment of P80,246,459.15 in deficiency taxes. These deficiency assessments mirrored those in a Preliminary Assessment Notice (PAN) dated November 29, 2002, which Avon had previously protested.

Avon, in its protest letter, asserted that the Bureau of Internal Revenue (BIR) had committed multiple procedural violations. It argued that the BIR increased the assessment without justifiable reason and ignored all submissions made by Avon to contest the deficiency tax assessments. It was not accorded a real opportunity to be heard, making all of the assessments null and void. It also pointed out that the Commissioner issued identical Preliminary Assessment Notice, Final Assessment Notices, and Collection Letters without considering Avon’s submissions or its partial payment of the assessments. A conference was allegedly held where Avon informed the revenue officers that all the documents necessary to support its defenses had already been submitted.

The Supreme Court emphasized the importance of due process in administrative proceedings. Due process furnishes a standard to which governmental action should conform to impress it with the stamp of validity. The Commissioner exercises administrative adjudicatory power or quasi-judicial function in adjudicating the rights and liabilities of persons under the Tax Code. In carrying out these quasi-judicial functions, the Commissioner is required to investigate facts or ascertain the existence of facts, hold hearings, weigh evidence, and draw conclusions from them as basis for their official action and exercise of discretion in a judicial nature. Tax investigation and assessment necessarily demand the observance of due process because they affect the proprietary rights of specific persons.

The Supreme Court referred to the seminal case of Ang Tibay v. The Court of Industrial Relations, which laid down the fundamental requirements of due process in administrative proceedings. One key requirement is that the administrative tribunal or body must consider the evidence presented. In addition, the decision must be rendered in a manner that the parties may know the various issues involved and the reasons for the decision. It then enumerated the fundamental requirements of due process that must be respected in administrative proceedings:

(1)

The party interested or affected must be able to present his or her own case and submit evidence in support of it.

(2)

The administrative tribunal or body must consider the evidence presented.

(7)

The administrative tribunal’s decision is rendered in a manner that the parties may know the various issues involved and the reasons for the decision.

Furthermore, Section 228 of the Tax Code, as implemented by Revenue Regulations No. 12-99, provides certain procedures to ensure that the right of the taxpayer to procedural due process is observed in tax assessments. Notably, the regulations prescribe the due process requirement for the four (4) stages of the assessment process: Notice for informal conference, Preliminary Assessment Notice (PAN), Formal Letter of Demand and Assessment Notice, and Administrative Decision on a Disputed Assessment. The importance of providing the taxpayer with adequate written notice of his or her tax liability is undeniable. Under Section 228, it is explicitly required that the taxpayer be informed in writing of the law and of the facts on which the assessment is made; otherwise, the assessment shall be void.

The Supreme Court found that Avon was deprived of due process. The details of the discrepancy attached to the Preliminary Assessment Notice, as well as the Formal Letter of Demand with the Final Assessment Notices, did not even comment or address the defenses and documents submitted by Avon. Thus, Avon was left unaware on how the Commissioner or her authorized representatives appreciated the explanations or defenses raised in connection with the assessments. There was clear inaction of the Commissioner at every stage of the proceedings. Given this procedural deficiency, the Court held that the presumption of correctness of assessments cannot apply in the face of compelling proof that they were issued without due process.

Consequently, the Court declared the tax assessments void. It held that the Commissioner’s total disregard of due process rendered the identical Preliminary Assessment Notice, Final Assessment Notices, and Collection Letter null and void, and of no force and effect. Compliance with strict procedural requirements must be followed in the collection of taxes as any arbitrariness will negate the very reason for government itself.

The Court also addressed the Commissioner’s arguments regarding estoppel and prescription. The Commissioner contended that Avon was estopped from assailing the validity of the Waivers of the Defense of Prescription because it paid portions of the disputed assessments. However, the Court found that Rizal Commercial Banking Corporation is not on all fours with this case. In contrast to Rizal Commercial Banking Corporation, Avon claimed that it did not receive any benefit from the waivers and there was even a drastic increase in the assessed deficiency taxes. Under these circumstances, Avon’s payment of an insignificant portion of the assessment cannot be deemed an admission or recognition of the validity of the waivers.

Finally, the Court addressed the issue of prescription. The Commissioner argued that Avon’s right to appeal its protest before the Court of Tax Appeals had prescribed. However, the Court held that the Collection Letter dated July 9, 2004, constituted the final decision of the Commissioner that is appealable to the Court of Tax Appeals and that Avon’s appeal to the Court of Tax Appeals was therefore not time-barred.

FAQs

What was the key issue in this case?	The key issue was whether the Commissioner of Internal Revenue violated Avon’s right to due process in issuing tax assessments, thereby rendering the assessments void. The Court held that due process was indeed violated.
What does “due process” mean in the context of tax assessments?	In tax assessments, due process requires that the taxpayer be informed of the legal and factual bases of the assessment, and that their defenses and evidence are duly considered by the taxing authority. The taxing authority must give some reason for rejecting any defense of the taxpayer.
What happens if the BIR fails to observe due process?	If the BIR fails to observe due process, the tax assessments are rendered null and void. This means the taxpayer is not legally obligated to pay the assessed taxes.
Can a taxpayer waive their right to due process?	While taxpayers can enter into agreements that affect the prescriptive periods for tax assessments, the BIR must still comply with procedural requirements to ensure the validity of such waivers. The BIR also cannot invoke estoppel to cover its own failures to comply with required procedures.
What is a Waiver of the Defense of Prescription?	A Waiver of the Defense of Prescription is a written agreement between the BIR and the taxpayer to extend the period within which the BIR can assess and collect taxes beyond the standard three-year period. This waiver must comply with certain requirements to be valid.
What options does a taxpayer have if the Commissioner of Internal Revenue fails to act on their protest?	A taxpayer can either file a petition for review with the Court of Tax Appeals within 30 days after the expiration of the 180-day period from the filing of a protest, or wait for the final decision of the Commissioner on the disputed assessment and appeal such final decision to the Court of Tax Appeals within 30 days after receipt of it. These are mutually exclusive remedies.
How did the Court determine that the Commissioner failed to act on Avon’s submissions?	The Court found that the Preliminary Assessment Notice, Final Assessment Notices, and Collection Letter were issued without addressing or commenting on the defenses and documents submitted by Avon. It was found that these submissions were simply ignored.
Can a Collection Letter be considered a final decision?	Yes, a Collection Letter can be considered a final decision if it demonstrates a character of finality, such as demanding payment with a warning of further action if not paid within a specific period. The facts and circumstances of each case will determine if a demand letter serves as a final determination.

This case underscores the vital importance of administrative due process in tax assessments. The Supreme Court’s decision reinforces that the BIR must adhere to established procedures and give genuine consideration to taxpayer evidence. This ruling serves as a crucial safeguard against arbitrary tax demands and ensures fairness in the assessment and collection of taxes.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: COMMISSIONER OF INTERNAL REVENUE vs. AVON PRODUCTS MANUFACTURING, INC., G.R. Nos. 201418-19, October 3, 2018

October 3, 2018

Tax Evasion: The Supreme Court’s Stance on Probable Cause and Assessment Finality

The Supreme Court ruled that the Secretary of Justice committed grave abuse of discretion in dismissing the tax evasion complaint against L.M. Camus Engineering Corporation (LMCEC). The Court emphasized that a tax assessment becomes final and unappealable if the taxpayer fails to contest it within the prescribed period, preventing collateral attacks on its validity. This decision reinforces the government’s authority to pursue tax evasion cases based on valid assessments and underscores the importance of taxpayers adhering to procedural requirements in disputing tax liabilities.

Unearthing Fraud: Can a Taxpayer Evade Prosecution by Ignoring a Final Assessment?

This case revolves around a tax fraud investigation initiated by the Commissioner of Internal Revenue (CIR) against L.M. Camus Engineering Corporation (LMCEC) for the taxable years 1997, 1998, and 1999. The investigation was triggered by information from an informant alleging substantial underdeclaration of income by LMCEC. Despite a subpoena duces tecum, LMCEC failed to provide its books of accounts, leading the CIR to gather information from third parties, revealing significant discrepancies between declared and actual income.

Based on this investigation, the CIR assessed LMCEC with deficiency taxes amounting to P430,958,005.90. A Preliminary Assessment Notice (PAN) was issued, followed by assessment notices and a formal letter of demand. LMCEC refused to receive these notices, prompting constructive service by the BIR. Consequently, the CIR filed a complaint with the Department of Justice (DOJ) against LMCEC and its officers for violating Sections 254 (Attempt to Evade or Defeat Tax) and 255 (Willful Failure to Pay Tax) of the National Internal Revenue Code (NIRC).

LMCEC countered that the DOJ was not the proper forum, arguing that the case was a simple civil action for collection rather than tax evasion. They challenged the validity of the assessment notices, citing the lack of serial numbers and proper affidavit of service. LMCEC also claimed to have availed of tax amnesty programs and that a prior examination had already been conducted for the years in question, limiting the BIR to a single examination per taxable year. LMCEC asserted that the CIR was estopped from further action due to the prior tax amnesty programs.

The Chief State Prosecutor initially found insufficient evidence to establish probable cause, citing LMCEC’s participation in tax amnesty programs and irregularities in the assessment notices. The Secretary of Justice upheld this decision, leading the CIR to appeal to the Court of Appeals (CA). The CA affirmed the Secretary of Justice’s ruling, prompting the CIR to elevate the case to the Supreme Court.

The Supreme Court, however, reversed the CA’s decision, holding that the Secretary of Justice had committed grave abuse of discretion. The Court emphasized that the assessment notices and Formal Letter of Demand contained the facts, law, rules and regulations, or jurisprudence on which the assessment was based. The Court noted that the details in the demand letter fulfill the requirements stipulated in Section 228 of the NIRC and Revenue Regulation (RR) No. 12-99.

The core issue before the Supreme Court was whether LMCEC and its officers could be prosecuted for violating Sections 254 and 255 of the NIRC. The Court noted that these sections penalize any person who willfully attempts to evade or defeat any tax or willfully fails to pay such tax or supply correct and accurate information.

The Supreme Court examined whether the participation of LMCEC in various tax amnesty programs barred the criminal prosecution. The court determined that LMCEC was actually ineligible to participate in the VAP, stating:

from the express terms of the aforesaid revenue regulations, LMCEC is not qualified to avail of the VAP granting taxpayers the privilege of last priority in the audit and investigation of all internal revenue taxes for the taxable year 2000 and all prior years under certain conditions, considering that first, it was issued a PAN on February 19, 2001, and second, it was the subject of investigation as a result of verified information filed by a Tax Informer under Section 282 of the NIRC duly recorded in the BIR Official Registry as Confidential Information (CI) No. 29-2000

Building on this principle, The Court clarified that estoppel generally does not apply against the government, especially in matters of taxation. The Supreme Court referred to the principle that the state cannot be in estoppel:

Given the explicit conditions for the grant of immunity from audit under RR No. 2-99, RR No. 8-2001 and RR No. 10-2001, we hold that respondent Secretary gravely erred in declaring that petitioner is now estopped from assessing any tax deficiency against LMCEC after issuance of the aforementioned documents of immunity from audit/investigation and settlement of tax liabilities. It is axiomatic that the State can never be in estoppel, and this is particularly true in matters involving taxation. The errors of certain administrative officers should never be allowed to jeopardize the government’s financial position.

The Supreme Court also addressed the argument that the assessment notices were invalid due to the absence of serial numbers. The Court clarified that the essential requirement for a valid assessment is that it informs the taxpayer of the declaration of deficiency tax and states the facts, law, rules, or jurisprudence on which the assessment is based. The absence of a control number did not invalidate the assessment.

The Court emphasized that tax assessments by tax examiners are presumed correct and made in good faith. In this case, LMCEC failed to file a petition for review with the Court of Tax Appeals within the statutory period, rendering the assessment final, executory, and demandable.

Furthermore, the Court addressed the lower court’s concerns regarding the lack of a prior determination of fraud. The Court determined that a prior determination of fraud was supported by factual basis and evidence on record. The revenue officers conducted a preliminary investigation based on information and documents showing substantial understatement of LMCEC’s tax liabilities. This was a crucial factor in finding probable cause for violations of Sections 254 and 255 of the NIRC.

In summary, the Supreme Court found that the Secretary of Justice committed grave abuse of discretion in dismissing the tax evasion complaint against LMCEC. The Court underscored the importance of adhering to procedural requirements in disputing tax assessments and the government’s authority to pursue tax evasion cases based on valid assessments.

FAQs

What was the key issue in this case?	The key issue was whether the Secretary of Justice committed grave abuse of discretion in dismissing the tax evasion complaint against LMCEC, particularly regarding the validity of the tax assessment and the effect of tax amnesty programs.
What is a Preliminary Assessment Notice (PAN)?	A PAN is a notice issued by the BIR to a taxpayer, informing them of a proposed assessment of deficiency taxes, detailing the facts and legal basis for the assessment. The taxpayer has a limited time to respond to the PAN.
What happens if a taxpayer fails to protest a tax assessment?	If a taxpayer fails to protest a tax assessment within the prescribed period, the assessment becomes final, executory, and demandable, precluding the taxpayer from challenging its validity.
Does the absence of a serial number invalidate a tax assessment?	No, the absence of a serial number does not automatically invalidate a tax assessment. The essential requirement is that the assessment must inform the taxpayer of the deficiency and state the factual and legal bases.
What constitutes a substantial underdeclaration of income?	Under the NIRC, a failure to report sales, receipts, or income exceeding 30% of that declared in the return is considered a substantial underdeclaration, constituting prima facie evidence of a false or fraudulent return.
Can the government be estopped from collecting taxes?	Generally, no. The State cannot be in estoppel, especially in matters of taxation. Errors of administrative officers should not jeopardize the government’s financial position.
What is tax fraud, and what are the penalties for it?	Tax fraud involves intentional and willful attempts to evade or defeat any tax. Penalties for tax fraud include fines and imprisonment, as specified in Sections 254 and 255 of the NIRC.
What is the role of the Department of Justice in tax evasion cases?	The Department of Justice, through its prosecutors, conducts preliminary investigations to determine if there is probable cause to charge individuals or entities with tax evasion or other tax-related offenses.
What is the significance of the ‘Best Evidence Obtainable’ rule?	The ‘Best Evidence Obtainable’ rule allows the BIR to assess a taxpayer’s tax liability based on the best available information when the taxpayer fails to provide necessary records or documents.

In conclusion, the Supreme Court’s decision in this case underscores the importance of upholding tax laws and ensuring that taxpayers comply with their obligations. This ruling emphasizes the finality of tax assessments when not properly challenged and reinforces the government’s authority to pursue tax evasion cases based on substantial evidence of fraud.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: COMMISSIONER OF INTERNAL REVENUE v. GONZALEZ, G.R. No. 177279, October 13, 2010

August 22, 2011

Taxpayer Protection: When Ambiguous Tax Notices Lead to Legal Relief in the Philippines

In a significant ruling, the Supreme Court of the Philippines emphasized the need for clear communication from the Commissioner of Internal Revenue (CIR) regarding tax assessments. The Court held that if the CIR’s communication is ambiguous and leads a taxpayer to reasonably believe that a formal assessment is a final decision, the CIR is estopped from claiming the taxpayer failed to exhaust administrative remedies. This decision protects taxpayers from potential confusion caused by unclear tax notices and ensures that the right to appeal is not unfairly prejudiced. The ruling serves as a reminder to tax authorities to use precise language in their communications to avoid misleading taxpayers about their legal options.

Navigating the Labyrinth: Did Allied Bank Jump the Gun or Follow the Taxman’s Lead?

This case revolves around Allied Banking Corporation’s challenge to deficiency Documentary Stamp Tax (DST) and Gross Receipts Tax (GRT) assessments for the taxable year 2001. The Bureau of Internal Revenue (BIR) initially issued a Preliminary Assessment Notice (PAN), which Allied Banking protested. Subsequently, the BIR issued a Formal Letter of Demand with Assessment Notices, containing a statement that the assessment was a “final decision based on investigation” and advising the bank to “appeal this final decision within thirty (30) days.” Believing this to be a final determination, Allied Banking directly filed a Petition for Review with the Court of Tax Appeals (CTA), bypassing the administrative protest stage usually required. The core legal question is whether the BIR’s Formal Letter of Demand was indeed a final decision appealable to the CTA, or whether Allied Banking prematurely sought judicial review by failing to file an administrative protest.

The CTA initially dismissed Allied Banking’s petition, citing a lack of jurisdiction because the bank had not filed an administrative protest against the Formal Letter of Demand. According to the CTA, it is the decision of the CIR on the disputed assessment (following an administrative protest) that can be appealed to the court, as highlighted in Commissioner of Internal Revenue vs. Villa, 22 SCRA 3. The CTA emphasized the importance of exhausting administrative remedies before seeking judicial intervention. However, the Supreme Court took a different view, focusing on the potential for confusion created by the BIR’s communication.

The Supreme Court acknowledged that the CTA has exclusive appellate jurisdiction to review decisions of the CIR in cases involving disputed assessments, as outlined in Section 7 of Republic Act (RA) No. 9282. Further, Section 228 of the National Internal Revenue Code (NIRC) provides the procedure for protesting an assessment. Normally, a taxpayer who disagrees with an assessment must file an administrative protest within 30 days of receiving the assessment notice. However, the Court recognized an exception to the general rule requiring exhaustion of administrative remedies, specifically estoppel on the part of the administrative agency.

The Court cited the case of Vda. De Tan v. Veterans Backpay Commission, 105 Phil. 377, 383 (1959), where the respondent was estopped from invoking the rule on exhaustion of administrative remedies because its own resolution indicated that only a final judicial ruling would be accepted. Similarly, in the present case, the Supreme Court found that the CIR’s Formal Letter of Demand contained language that could reasonably be interpreted as a final decision, thereby estopping the CIR from arguing that Allied Banking should have filed an administrative protest.

The critical portion of the Formal Letter of Demand stated, “This is our final decision based on investigation. If you disagree, you may appeal this final decision within thirty (30) days from receipt hereof, otherwise said deficiency tax assessment shall become final, executory and demandable.” This language, according to the Supreme Court, suggested that the CIR had already made a final determination on the matter, and the taxpayer’s recourse was to appeal within 30 days. In Oceanic Wireless Network, Inc. v. Commissioner of Internal Revenue, G.R. No. 148380, December 9, 2005, 477 SCRA 205, 211, the Supreme Court also considered the language used and the tenor of the letter sent to the taxpayer as the final decision of the CIR.

Furthermore, the Court highlighted the use of the word “appeal” in the Formal Letter of Demand. Under prevailing tax laws, “appeal” typically refers to the filing of a Petition for Review with the CTA, while terms like “protest,” “reinvestigation,” and “reconsideration” refer to administrative remedies before the CIR. This distinction, coupled with the “final decision” statement, reasonably led Allied Banking to believe that its next step was to appeal to the CTA.

The Court emphasized the importance of clarity in the CIR’s communications, stating, “We have time and again reminded the CIR to indicate, in a clear and unequivocal language, whether his action on a disputed assessment constitutes his final determination thereon in order for the taxpayer concerned to determine when his or her right to appeal to the tax court accrues.” Any ambiguity or doubt in the interpretation of the Formal Letter of Demand should be resolved in favor of the taxpayer, not the agency causing the confusion.

The Supreme Court clarified that it was not disregarding the rules of procedure under Section 228 of the NIRC or deviating from its prior rulings on the commencement of the 30-day appeal period. Rather, it emphasized that the specific language used in the Formal Letter of Demand, combined with the circumstances of the case, justified treating it as a final decision appealable to the CTA, even without a prior administrative protest.

Notably, during the pendency of the case, Allied Banking availed itself of Revenue Regulations No. 30-2002 and submitted an offer of compromise for the settlement of its GRT, DST, and VAT liabilities for the period 1998-2003. The BIR accepted this offer, rendering the original Petition for Review moot. Consequently, while the Supreme Court reversed the CTA’s decision, it ultimately dismissed Allied Banking’s petition based on the accepted compromise agreement.

FAQs

What was the key issue in this case?	The key issue was whether the BIR’s Formal Letter of Demand constituted a final decision appealable to the CTA, even though Allied Banking did not file an administrative protest. The Supreme Court focused on whether the language of the letter reasonably led the taxpayer to believe it was a final decision.
What is a Preliminary Assessment Notice (PAN)?	A PAN is an initial notice from the BIR informing a taxpayer of a potential deficiency tax assessment. It gives the taxpayer an opportunity to respond and present their side before a formal assessment is issued.
What is a Formal Letter of Demand?	A Formal Letter of Demand is a notice from the BIR demanding payment of a deficiency tax liability. It usually includes an assessment notice and states the basis for the assessment.
What does it mean to exhaust administrative remedies?	Exhausting administrative remedies means pursuing all available avenues for resolving a dispute within an administrative agency before seeking judicial review. In tax cases, this typically involves filing a protest with the BIR before appealing to the CTA.
What is the Court of Tax Appeals (CTA)?	The CTA is a special court in the Philippines that has exclusive appellate jurisdiction over tax-related cases. It reviews decisions of the Commissioner of Internal Revenue, the Commissioner of Customs, and other relevant agencies.
What is the significance of the word “appeal” in the BIR’s letter?	The Supreme Court noted that the use of the word “appeal” suggested that the taxpayer’s next step was to file a Petition for Review with the CTA, as opposed to filing an administrative protest with the BIR. This contributed to the ambiguity of the letter.
What is estoppel?	In legal terms, estoppel prevents a party from asserting a right or claim that contradicts its previous actions or statements. In this case, the BIR was estopped from claiming Allied Banking failed to exhaust administrative remedies because the BIR’s own letter implied that the assessment was a final decision.
What was the ultimate outcome of the case?	While the Supreme Court reversed the CTA’s decision, it ultimately dismissed Allied Banking’s petition because the bank had entered into a compromise agreement with the BIR to settle its tax liabilities.

This case highlights the importance of clear and unambiguous communication from government agencies, especially in matters as complex as tax law. The Supreme Court’s decision serves as a reminder that agencies must ensure their communications do not mislead taxpayers about their rights and obligations. The ruling in Allied Banking provides a crucial safeguard for taxpayers facing potentially confusing tax assessments.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: ALLIED BANKING CORPORATION vs. COMMISSIONER OF INTERNAL REVENUE, G.R. No. 175097, February 05, 2010

February 5, 2010

Finality of Tax Assessments: When Collection Efforts Don’t Reopen Tax Disputes

The Supreme Court has ruled that collection efforts by the Bureau of Customs (BOC) based on previously settled tax liabilities do not reopen the original tax assessment for protest. Pilipinas Shell’s attempt to question the validity of tax credit certificate cancellations was deemed outside the jurisdiction of the Court of Tax Appeals (CTA). This means taxpayers cannot use collection letters as an opportunity to challenge long-settled tax assessments; instead, disputes over payment methods must be resolved in ordinary courts.

Tax Credit Troubles: Can Old Assessments Be Challenged Through Collection Letters?

Pilipinas Shell Petroleum Corporation, engaged in importing petroleum products, paid customs duties and internal revenue taxes using tax credit certificates (TCCs). These TCCs were transferred to Shell by Board of Investment (BOI)-registered companies and approved by the One Stop Shop Inter-Agency Tax Credit and Duty Drawback Center. Subsequently, the Center canceled these TCCs, claiming they were fraudulently secured, and demanded Shell pay the corresponding amounts. Shell contested the cancellation, arguing a lack of due process, but the Commissioner of Customs insisted on payment, leading to collection efforts.

The core legal issue revolved around whether Shell could challenge the tax liabilities in the CTA at this stage. Section 7 of RA No. 1125 states the CTA has jurisdiction over “Decisions of the Commissioner of Customs in cases involving liability for customs duties, fees or other money charges”. This refers to decisions on administrative tax protest cases. Under Section 2402 of the Tariff and Customs Code, a party aggrieved by the Commissioner’s ruling “upon protest” may appeal to the CTA. The court emphasized that Shell’s original tax liabilities had already been assessed, and these assessments were considered settled when Shell used the TCCs. The subsequent demand for payment due to the cancellation of the TCCs did not constitute a reassessment or a new basis for protest; rather, it was a collection effort based on the original assessment.

The Supreme Court highlighted that Shell never protested the original tax assessments. Therefore, these assessments became final and beyond any subsequent protest proceedings. The Court reasoned that the letters Shell received demanding payment based on the canceled TCCs did not constitute a new assessment that could be protested. Rather, these were collection letters based on existing assessments. The real issue for Shell was the validity of the TCC cancellations, which was a decision made by the Center, not the Commissioner of Customs. Consequently, Shell should have sought a certiorari petition with the regular courts regarding the TCC cancellation or raised its payment defense in the collection cases before the RTC, as confirmed in Shell v. Republic of the Philippines.

The Court further cited Dayrit v. Cruz, stating that collection efforts on a final tax assessment are akin to enforcing a judgment. “No inquiry can be made therein as to the merits of the original case or the justness of the judgment relied upon.” Therefore, once an assessment becomes final, the focus shifts to collection, and the taxpayer cannot revisit the original assessment in court. In summary, collection letters from the BOC, even if framed as a final demand, cannot be used as a springboard to reopen or protest the original tax assessment; such issues should be contested through the proper legal channels concerning the cancellation of the TCCs or as a defense in collection proceedings.

FAQs

What was the key issue in this case?	The key issue was whether the collection letters issued by the Commissioner of Customs could be considered a decision appealable to the Court of Tax Appeals (CTA), allowing Shell to protest its tax liabilities anew.
What is a tax credit certificate (TCC)?	A TCC is a document issued by the government, often to BOI-registered companies, that can be used to settle tax obligations. It is transferable for value to other entities, subject to government approval.
Why were Shell’s TCCs cancelled?	The TCCs were cancelled by the One Stop Shop Inter-Agency Tax Credit and Duty Drawback Center due to findings that the original grantees had fraudulently secured them.
Did Shell protest the original tax assessments?	No, Shell did not protest the original assessments of its tax liabilities. It initially settled them using the TCCs, which were later cancelled.
What was the Court’s reasoning in denying Shell’s petition?	The Court reasoned that the collection letters did not constitute a new assessment that could be protested. The original assessments were final, and Shell’s issue concerned the validity of the TCC cancellations, which should have been addressed separately.
Where should Shell have filed its case regarding the TCC cancellation?	Shell should have filed a certiorari petition before the regular courts challenging the decision of the Center to cancel the TCCs. Alternatively, Shell could raise its payment defense in the collection cases before the RTC.
What is the significance of a final tax assessment?	A final tax assessment means the tax liability is determined and no longer open for dispute. Collection efforts are then focused on enforcing the assessment.
What does the case tell us about challenging tax collection efforts?	It clarifies that collection efforts do not reopen the underlying tax assessment for protest. The challenge must focus on the validity of the payment method or seek relief through appropriate channels like certiorari.

In conclusion, this case clarifies the boundaries of tax protest procedures, emphasizing that taxpayers cannot use collection letters as an opportunity to reopen already finalized tax assessments. The proper recourse lies in challenging the specific grounds for the collection efforts, such as the validity of the payment instrument, rather than disputing the original tax liability.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: PILIPINAS SHELL PETROLEUM CORPORATION VS. COMMISSIONER OF CUSTOMS, G.R. No. 176380, June 18, 2009

June 18, 2009

Tax Assessments: The Imperative of Timely Protests in Philippine Law

In the Philippines, taxpayers must promptly contest tax assessments issued by the Commissioner of Internal Revenue (CIR). The Supreme Court, in this case, underscores that failure to protest an assessment within the legally prescribed period renders the assessment final and unappealable. This ruling emphasizes the taxpayer’s responsibility to actively challenge assessments they believe are incorrect, reinforcing the principle that tax assessments are presumed correct unless proven otherwise. The decision clarifies the procedural requirements for protesting tax assessments, highlighting the critical importance of adhering to statutory deadlines to preserve one’s right to appeal.

Unraveling Tax Liabilities: Did BPI Miss Its Chance to Contest?

This case revolves around deficiency percentage and documentary stamp taxes assessed by the CIR against the Bank of the Philippine Islands (BPI) for the year 1986. The CIR issued notices of assessment in October 1988. BPI argued that these notices lacked sufficient detail regarding the factual and legal bases for the assessment. The central legal question is whether BPI’s failure to formally protest these initial assessments within the prescribed timeframe barred it from later contesting the tax liabilities.

The CIR contended that the October 1988 notices were valid assessments under the prevailing tax code at the time, which only required notifying the taxpayer of the findings. BPI, however, claimed that due process demanded a more detailed explanation of the assessment’s basis. The Court of Tax Appeals (CTA) initially sided with the CIR, dismissing BPI’s petition for review due to the bank’s failure to file a timely protest. The Court of Appeals (CA) reversed this decision, arguing that the initial notices were not valid assessments because they lacked sufficient information. This led the CIR to elevate the case to the Supreme Court.

The Supreme Court had to determine whether the initial notices sufficiently met the requirements of a valid assessment under the old law and jurisprudence. The former Section 270 of the National Internal Revenue Code (NIRC) stated:

Sec. 270. Protesting of assessment. — When the [CIR] or his duly authorized representative finds that proper taxes should be assessed, he shall first notify the taxpayer of his findings. Within a period to be prescribed by implementing regulations, the taxpayer shall be required to respond to said notice. If the taxpayer fails to respond, the [CIR] shall issue an assessment based on his findings.

The Court emphasized that under the old law, the CIR was only required to notify the taxpayer of the findings. There was no explicit requirement to provide a written statement detailing the law and facts supporting the assessment. In contrast, the amended Section 228 of the NIRC now mandates that “[t]he taxpayer shall be informed in writing of the law and the facts on which the assessment is made; otherwise, the assessment shall be void.”

Building on this principle, the Supreme Court distinguished between the requirements of the old and new tax codes. The Court stated, in CIR v. Reyes:

In the present case, Reyes was not informed in writing of the law and the facts on which the assessment of estate taxes had been made. She was merely notified of the findings by the CIR, who had simply relied upon the provisions of former Section 229 prior to its amendment by [RA] 8424, otherwise known as the Tax Reform Act of 1997… The notice required under the old law was no longer sufficient under the new law.

The Court held that the October 1988 notices met the requirements of a valid assessment under the then-prevailing law and jurisprudence. BPI should have protested the assessments within 30 days of receiving them. Its December 10, 1988, reply did not constitute a formal protest because the bank indicated it would decide whether to protest after further clarification. Therefore, BPI’s failure to file a timely protest rendered the assessments final and unappealable. The Supreme Court highlighted the implications of a valid assessment:

Considering that the October 28, 1988 notices were valid assessments, BPI should have protested the same within 30 days from receipt thereof. The December 10, 1988 reply it sent to the CIR did not qualify as a protest since the letter itself stated that “[a]s soon as this is explained and clarified in a proper letter of assessment, we shall inform you of the taxpayer’s decision on whether to pay or protest the assessment.” Hence, by its own declaration, BPI did not regard this letter as a protest against the assessments.

Even if the December 10, 1988, letter was considered a protest, BPI failed to appeal the CIR’s final decision within the statutory period. The CIR’s May 8, 1991, response was his “final decision on the matter.” BPI had 30 days from receiving this decision on June 27, 1991, to appeal, but it filed its appeal with the CTA on February 18, 1992, which was beyond the allowed timeframe.

The Supreme Court also emphasized the presumption of correctness of tax assessments:

Tax assessments by tax examiners are presumed correct and made in good faith. The taxpayer has the duty to prove otherwise. In the absence of proof of any irregularities in the performance of duties, an assessment duly made by a Bureau of Internal Revenue examiner and approved by his superior officers will not be disturbed. All presumptions are in favor of the correctness of tax assessments.

The Supreme Court reversed the CA’s decision, reinstating the CTA’s dismissal of BPI’s appeal. The Court stressed the importance of taxes to the government and the need for taxpayers to comply with tax laws:

Taxes are the lifeblood of the government, for without taxes, the government can neither exist nor endure. A principal attribute of sovereignty, the exercise of taxing power derives its source from the very existence of the state whose social contract with its citizens obliges it to promote public interest and common good. The theory behind the exercise of the power to tax emanates from necessity; without taxes, government cannot fulfill its mandate of promoting the general welfare and well-being of the people.

FAQs

What was the key issue in this case?	The key issue was whether BPI’s failure to protest the initial tax assessments within the prescribed period rendered those assessments final and unappealable.
What did the initial tax assessment notices lack, according to BPI?	According to BPI, the initial tax assessment notices lacked sufficient detail regarding the factual and legal bases for the deficiency tax assessments.
What was the requirement for a valid tax assessment under the old law?	Under the old law, the CIR was only required to notify the taxpayer of the findings, without necessarily providing a detailed explanation of the assessment’s legal and factual bases.
How does the current law differ regarding tax assessment notices?	The current law mandates that the taxpayer be informed in writing of the law and the facts on which the assessment is made; otherwise, the assessment shall be void.
What was the Supreme Court’s ruling in this case?	The Supreme Court ruled that the initial tax assessment notices were valid under the old law, and BPI’s failure to protest them within the prescribed period rendered them final and unappealable.
What is the significance of protesting a tax assessment within the given timeframe?	Protesting a tax assessment within the given timeframe is crucial to preserve the taxpayer’s right to appeal and contest the assessment’s validity.
What is the presumption regarding tax assessments made by tax examiners?	Tax assessments made by tax examiners are presumed correct and made in good faith, and the taxpayer has the burden of proving otherwise.
What is the basis for the government’s power to tax?	The government’s power to tax is based on necessity, as taxes are the lifeblood of the government and enable it to fulfill its mandate of promoting the general welfare and well-being of the people.

This case serves as a critical reminder of the importance of promptly addressing tax assessments. Taxpayers must be vigilant in understanding and complying with tax laws, and they must act swiftly to protect their rights when facing potentially erroneous assessments. Failure to do so can result in the irreversible loss of the opportunity to challenge tax liabilities.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: COMMISSIONER OF INTERNAL REVENUE VS. BANK OF THE PHILIPPINE ISLANDS, G.R. NO. 134062, April 17, 2007

April 17, 2007

Delegation of Authority in Tax Assessments: Validity of Subordinate Officer’s Demand Letters

The Supreme Court ruled that a demand letter for tax deficiency assessments issued by a subordinate officer of the Bureau of Internal Revenue (BIR), acting on behalf of the Commissioner, is considered final and appealable to the Court of Tax Appeals (CTA). This means taxpayers must act on these demand letters within the prescribed period, even if not directly from the Commissioner, to preserve their right to appeal. Failure to do so renders the assessment final, executory, and demandable, impacting the taxpayer’s ability to contest the assessment.

Taxman’s Delegation: When Does a Demand Letter Trigger the Appeal Clock?

This case arose when Oceanic Wireless Network, Inc. challenged the authority of the Chief of the Accounts Receivable and Billing Division of the BIR National Office to issue final decisions on tax deficiency assessments. In 1988, Oceanic Wireless received deficiency tax assessments totaling P8,644,998.71 for the taxable year 1984. The company protested, seeking reconsideration or cancellation of the assessments. Subsequently, the Chief of the BIR Accounts Receivable and Billing Division denied the request for reinvestigation and reiterated the tax assessments in a letter dated January 24, 1991, demanding payment within ten days. When Oceanic Wireless failed to pay, warrants of distraint and levy were issued. This led Oceanic Wireless to file a Petition for Review with the CTA, contesting the warrants, which was ultimately dismissed for being filed beyond the 30-day period.

The CTA based its dismissal on the premise that the January 24, 1991 demand letter constituted the final decision of the Commissioner, triggering the 30-day appeal period. The core legal question was whether a demand letter issued by a subordinate officer, acting on behalf of the Commissioner, qualifies as a final decision appealable to the CTA. The Court of Appeals upheld the CTA’s decision, prompting Oceanic Wireless to elevate the matter to the Supreme Court.

The Supreme Court affirmed that a demand letter could indeed be considered a final decision on a disputed assessment, hinging on the language and tenor of the letter. The Court emphasized the necessity for the Commissioner of Internal Revenue to clearly communicate a final determination to the taxpayer, allowing them to understand when their right to appeal accrues. In this case, the letter unequivocally demanded payment of the deficiency taxes, with a warning of enforcement through distraint and levy upon failure to comply, coupled with a denial of the request for reconsideration due to lack of supporting documents.

. . . we deem it appropriate to state that the Commissioner of Internal Revenue should always indicate to the taxpayer in clear and unequivocal language whenever his action on an assessment questioned by a taxpayer constitutes his final determination on the disputed assessment, as contemplated by Sections 7 and 11 of Republic Act No. 1125, as amended. On the basis of his statement indubitably showing that the Commissioner’s communicated action is his final decision on the contested assessment, the aggrieved taxpayer would then be able to take recourse to the tax court at the opportune time.

The court then addressed the issue of delegation of authority. Under the National Internal Revenue Code (NIRC), the Commissioner can delegate powers to subordinate officials with the rank equivalent to a division chief or higher, except for specific powers enumerated in Section 7. These non-delegable powers include recommending the promulgation of rules and regulations, issuing rulings of first impression, compromising or abating tax deficiencies, and assigning internal revenue officers to establishments producing excise tax items. The act of issuing the demand letter did not fall under any of these exceptions.

Section 6 of the NIRC further clarifies that the authority to make tax assessments can be delegated. This means that an assessment made by a subordinate officer, if not reviewed or revised by the Commissioner, has the same force and effect as one issued by the Commissioner directly. Therefore, the demand letter issued by the Chief of the Accounts Receivable and Billing Division was deemed a valid exercise of delegated authority.

The Supreme Court highlighted that taxpayers have thirty days from receipt of a tax deficiency assessment to request a reconsideration; otherwise, the decision becomes final and demandable. Oceanic Wireless failed to bring the matter before the CTA within the prescribed period. While the exact date of receipt was not established, the Court applied the presumption of regular mail delivery under Section 2(v), Rule 131 of the Rules of Court. Given the filing date with the CTA, the assessment had long become final and executory, depriving the CTA of jurisdiction.

FAQs

What was the key issue in this case?	The key issue was whether a demand letter issued by a subordinate officer of the BIR, acting for the Commissioner, could be considered a final decision appealable to the Court of Tax Appeals.
What did the BIR assess against Oceanic Wireless?	The BIR assessed deficiency taxes against Oceanic Wireless for the taxable year 1984, totaling P8,644,998.71, including income tax, penalties, contractor’s tax, fixed tax, and franchise tax.
When did Oceanic Wireless file its appeal with the CTA?	Oceanic Wireless filed its Petition for Review with the Court of Tax Appeals on November 8, 1991, contesting the warrants of distraint and levy.
What is the effect of a final tax assessment?	A final tax assessment becomes executory and demandable, meaning the BIR can enforce collection through remedies like distraint and levy, and the taxpayer loses the right to contest the assessment.
What is the deadline to appeal an assessment?	Taxpayers have thirty (30) days from receipt of the Commissioner’s decision to appeal to the Court of Tax Appeals. Failure to do so renders the assessment final.
Can the Commissioner of Internal Revenue delegate powers?	Yes, the Commissioner can delegate powers to subordinate officers with the rank of division chief or higher, except for specific powers enumerated in Section 7 of the National Internal Revenue Code.
What are some non-delegable powers of the CIR?	Non-delegable powers include recommending rules and regulations, issuing rulings of first impression, compromising tax deficiencies, and assigning internal revenue officers to excise tax establishments.
How does the presumption of regular mail affect the case?	The court presumed that Oceanic Wireless received the demand letter within a reasonable time after it was mailed, in accordance with the Rules of Court, absent evidence to the contrary.

In conclusion, the Supreme Court’s decision reinforces the importance of prompt action upon receiving tax assessments and demand letters, even if issued by subordinate officers of the BIR. Taxpayers must remain vigilant and adhere to the prescribed timelines for filing protests and appeals to protect their rights and avoid the finality of tax assessments.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Oceanic Wireless Network, Inc. vs. Commissioner of Internal Revenue, G.R. NO. 148380, December 09, 2005

December 9, 2005

(1)	The party interested or affected must be able to present his or her own case and submit evidence in support of it.

(2)	The administrative tribunal or body must consider the evidence presented.

(7)	The administrative tribunal’s decision is rendered in a manner that the parties may know the various issues involved and the reasons for the decision.