Criminal Law, Taxation

TUPAZ v. ULEP G.R. No. 127777. October 1, 1999 Taxation, Assessment, Prescriptive Period, Criminal Action


     On January 10, 1991, two Informations were filed with the RTC, against Petronila C. Tupaz and her late husband Jose J. Tupaz, Jr., as corporate officers of El Oro Engravers Corp., for nonpayment of deficiency corporate income tax for the year 1979.

Criminal Case No. Q-91-17321 was raffled to Branch 105, presided over by respondent Judge Benedicto B. Ulep; Q-91-17322 was raffled to Branch 86, then presided over by Judge Antonio P. Solano.

On May 20, 1996, Judge Ulep granted the motion for withdrawal of the information in Criminal Case No. Q-91-17321 and dismissed the case, as prayed for by the prosecution.

Prosecutor Agcaoili filed a motion to reinstate information in Criminal Case Q-91-17321, stating that the motion to withdraw information was made through palpable mistake, and was the result of excusable neglect. He thought that Criminal Case No. Q-91-17321 was identical to Criminal Case No Q-90-12896, wherein accused was charged with nonpayment of deficiency contractors tax, amounting to P346,879.29.

Over the objections of accused, Judge Ulep granted the motion and ordered the information in Criminal Case No. Q-91-17321 reinstated. The subsequent MR was denied.

 Petitioner submits that respondent judge committed a grave abuse of discretion in reinstating the information in Criminal Case No. Q-91-17321 because

(a) the offense has prescribed; or

(b) it exposes her to double jeopardy.

As regards the issue of prescription, petitioner contends that:

(a) the period of assessment has prescribed, applying the three year period provided under Batas Pambansa No. 700;

(b) the offense has prescribed since the complaint for preliminary investigation was filed only on June 8, 1989, and the offense was committed in April 1980 when she filed the income tax return covering taxable year 1979.

On July 16, 1984, the Bureau of Internal Revenue (BIR) issued a notice of assessment. Petitioner contends that the July 16, 1984 assessment was made out of time.

Petitioner avers that while Sections 318 and 319 of the NIRC of 1977 provide a five (5) year period of limitation for the assessment and collection of internal revenue taxes, Batas Pambansa Blg. 700, enacted on February 22, 1984, amended the two sections and reduced the period to three (3) years. Since the tax return was filed in April 1980, the assessment made on July 16, 1984 was beyond the three (3) year prescriptive period.

Petitioner submits that B.P. Blg. 700 must be given retroactive effect since it is favorable to the accused. Petitioner argues that Article 22 of the Revised Penal Code, regarding the allowance of retroactive application of penal laws when favorable to the accused shall apply in this case.



  1. Whether or not the period of assessment has prescribed.
  2. Whether or not Article 22 of the Revised Penal Code shall apply in this case.
  3. Whether or not the trial court committed grave abuse of discretion in reinstating the information against petitioner




 1.  At the outset, it must be stressed that internal revenue taxes are self-assessing and no further assessment by the government is required to create the tax liability. An assessment, however, is not altogether inconsequential; it is relevant in the proper pursuit of judicial and extra judicial remedies to enforce taxpayer liabilities and certain matters that relate to it, such as the imposition of surcharges and interest, and in the application of statues of limitations and in the establishment of tax liens.

An assessment contains not only a computation of tax liabilities, but also a demand for payment within a prescribed period. The ultimate purpose of assessment is to ascertain the amount that each taxpayer is to pay.

An assessment is a notice to the effect that the amount therein stated is due as tax and a demand for payment thereof. Assessments made beyond the prescribed period would not be binding on the taxpayer.

We agree with the Solicitor General that the shortened period of three (3) years prescribed under B.P. Blg. 700 is not applicable to petitioner. B.P. Blg. 700, effective April 5, 1984, specifically states that the shortened period of three years shall apply to assessments and collections of internal revenue taxes beginning taxable year 1984.

Assessments made on or after April 5, 1984 are governed by the five-year period if the taxes assessed cover taxable years prior to January 1, 1984. The deficiency income tax under consideration is for taxable year 1979. Thus, the period of assessment is still five years, under the old law. The income tax return was filed in April 1980. Hence, the July 16, 1984 tax assessment was issued within the prescribed period of five (5) years, from the last day of filing the return, or from the date the return is filed, whichever comes later.



  1. Article 22 of the Revised Penal Code finds no application in this case for the simple reason that the provisions on the period of assessment cannot be considered as penal in nature.

We agree with the Solicitor General that the offense has not prescribed. Petitioner was charged with failure to pay deficiency income tax after repeated demands by the taxing authority. In Lim, Sr. v. Court of Appeals, we stated that by its nature the violation could only be committed after service of notice and demand for payment of the deficiency taxes upon the taxpayer. Hence, it cannot be said that the offense has been committed as early as 1980, upon filing of the income tax return. This is so because prior to the finality of the assessment, the taxpayer has not committed any violation for nonpayment of the tax. The offense was committed only after the finality of the assessment coupled with taxpayers willful refusal to pay the taxes within the allotted period. In this case, when the notice of assessment was issued on July 16, 1984, the taxpayer still had thirty days from receipt thereof to protest or question the assessment. Otherwise, the assessment would become final and unappealable.

As he did not protest, the assessment became final and unappealable on August 16, 1984. Consequently, when the complaint for preliminary investigation was filed on June 8, 1989, the criminal action was instituted within the five (5) year prescriptive period.


  1. However, the petitioner’s contention that the reinstatement of the information would expose her to double jeopardy. An accused is placed in double jeopardy if he is again tried for an offense for which he has been convicted, acquitted or in another manner in which the indictment against him was dismissed without his consent. In the instant case, there was a valid complaint filed against petitioner to which she pleaded not guilty. The court dismissed the case at the instance of the prosecution, without asking for accused-petitioners consent. This consent cannot be implied or presumed. Such consent must be expressed as to have no doubt as to the accused’s conformity. As petitioner’s consent was not expressly given, the dismissal of the case must be regarded as final and with prejudice to the re-filing of the case. Consequently, the trial court committed grave abuse of discretion in reinstating the information against petitioner in violation of her constitutionally protected right against double jeopardy.


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