THIRD DIVISION

[G.R. No. 128315. June 29, 1999]

COMMISSIONER OF INTERNAL REVENUE, petitioner, vs. ASCOR REALT! AN" "EVELO MENT COR ORATION, ROGELIO A. "IO #n$ VIRGINIA S. "IO, respondents. "ECISION
ANGANI%AN, J.:

An assessment contains not only a computation of tax liabilities, but also a demand for payment wit in a prescribed period! It also si"nals t e time w en penalties and interests be"in to accrue a"ainst t e taxpayer! To enable t e taxpayer to determine is remedies t ereon, due process re#uires t at it must be ser$ed on and recei$ed by t e taxpayer! Accordin"ly, an affida$it, w ic was executed by re$enue officers statin" t e tax liabilities of a taxpayer and attac ed to a criminal complaint for tax e$asion, cannot be deemed an assessment t at can be #uestioned before t e %ourt of Tax Appeals! S&#&e'en& o( &)e C#*e &efore t is %ourt is a 'etition for Re$iew on Certiorari under Rule () of t e Rules of %ourt prayin" for t e nullification of t e October *+, ,--. Decision /,0 of t e %ourt of Appeals/10 in %A23R S' No! (+4)*, w ic effecti$ely affirmed t e 5anuary 1), ,--. Resolution/*0 of t e %ourt of Tax Appeals/(0 in %TA %ase No! )16,! T e %TA disposed as follows7 89H:R:;OR:, findin" /t e erein petitioner<s0 =>otion to Dismiss< as ?N>:RITORIO?S, t e same is ereby D:NI:D! /T e %IR0 is ereby "i$en a period of t irty @*+A days from receipt ereof to file er answer!B 'etitioner also seeCs to nullify t e ;ebruary ,*, ,--6 Resolution /)0 of t e %ourt of Appeals denyin" reconsideration! T)e F#+&* As found by t e %ourt of Appeals, t e undisputed facts of t e case are as follows7

8It appears t at by $irtue of Detter of Aut ority No! ++,,-4, t en &IR %ommissioner 5ose ?! On" aut oriEed Re$enue Officers T omas T! Fue, Sonia T! :storco and :mmanuel >! Sa$ellano to examine t e booCs of accounts and ot er accountin" records of 'ascor Realty and De$elopment %orporation! @'RD%A for t e years endin" ,-4., ,-46 and ,-44! T e said examination resulted in a recommendation for t e issuance of an assessment in t e amounts of '6,(-4,(*(!.) and '*,+,),1*.!*) for t e years ,-4. and ,-46, respecti$ely! %IR Co'',**,one- On. ,**ue$ # Le&&e- o( Au&)o-,&/ &o &)e Re0enue o((,+e-* &o e1#',ne &)e 2oo3* o( #++oun&* #n$ o&)e- #++oun&,n. -e+o-$* o( Re*4on$en& #*+o- Re#5&/ "e0e5o4'en& Co-4 6 R"C7 (o- &)e /e#-* 1988, 1989 #n$ 1988. A**e**'en&* ,n &)e #'oun&* o( 9M: #n$ 3M: (o- /e#-* 1988 #n$ 1989, -e*4e+&,0e5/ ;e-e ,**ue$. T)e CIR (,5e$ # +-,',n#5 +o'45#,n& #.#,n*& &)e -e*,$en& #n$ T-e#*u-e- 6 -,0#&e -e*4on$en&*7 o( R"C (o- &#1 e0#*,on ,n &)e #'oun& o( 1<M:. T)e 5#&e- (,5e$ # Re+on*,$e-#&,on=Re,n0e*&,.#&,on $,*4u&,n. &)e &#1 #**e**'en& #n$ &#1 5,#2,5,&/, ;),+) &)e CIR $en,e$ on &)e .-oun$ o( no (o-'#5 &)#& no (o-'#5 #**e**'en& )#* #* /e& ,**ue$ 2/ &)e Co'',**,one-. 8On >arc ,, ,--), t e %ommissioner of Internal Re$enue filed a criminal complaint before t e Department of 5ustice a"ainst t e 'RD%, its 'resident Ro"elio A! Dio, and its Treasurer Vir"inia S! Dio, alle"in" e$asion of taxes in t e total amount of ',+,),*,.6,!++! 'ri$ate respondents 'RD%, et! al! filed an ?r"ent Re#uest for ReconsiderationGRein$esti"ation disputin" t e tax assessment and tax liability! 8On >arc 1*, ,--), pri$ate respondents recei$ed a subpoena from t e DO5 in connection wit t e criminal complaint filed by t e %ommissioner of Internal Re$enue @&IRA a"ainst t em! 8In a letter dated >ay ,6, ,--), t e %IR denied t e ur"ent re#uest for reconsiderationGrein$esti"ation of t e pri$ate respondents on t e "round t at no formal assessment as as yet been issued by t e %ommissioner! 8'ri$ate respondents t en ele$ated t e Decision of t e %IR dated >ay ,6, ,--) to t e %ourt of Tax Appeals on a petition for re$iew docCeted as %TA %ase No! )16, on 5uly 1,, ,--)! On September ., ,--), t e %IR filed a >otion to Dismiss t e petition on t e "round t at t e %TA as no Hurisdiction o$er t e subHect matter of t e petition, as t ere was no formal assessment issued a"ainst t e petitioners! T e %TA denied t e said motion to dismiss in a Resolution dated 5anuary 1), ,--. and ordered t e %IR to file an answer wit in t irty @*+A days from receipt of said resolution! T e %IR recei$ed t e resolution on 5anuary *,, ,--. but did not file an answer nor did s e mo$e to reconsider t e resolution! -,0#&e -e*4on$en&* (,5e$ # 4e&,&,on (o- -e0,e; ;,&) &)e CTA. CIR (,5e$ # MT" on &)e .-oun$ &)#& &)e CTA )#* no >u-,*$,+&,on o0e- &)e *u2>e+& '#&&e- o( &)e

4e&,&,on, on &)e *#'e .-oun$, &)#& no (o-'#5 #**e**'en& )#* 2een ,**ue$ &o &)e 4-,0#&e -e*4on$en&*. CTA $en,e$ &)e MT". 8Instead, t e %IR filed t is petition on 5une 6, ,--., alle"in" as "rounds t at7 =Respondent %ourt of Tax Appeals acted wit "ra$e abuse of discretion and wit out Hurisdiction in considerin" t e affida$itGreport of t e re$enue officer and t e indorsement of said report to t e secretary of Hustice as assessment w ic may be appealed to t e %ourt of Tax AppealsI Respondent %ourt of Tax Appeals acted wit "ra$e abuse of discretion in considerin" t e denial by petitioner of pri$ate respondents< >otion for Reconsideration as /a0 final decision w ic may be appealed to t e %ourt of Tax Appeals!< 8In denyin" t e motion to dismiss filed by t e %IR, t e %ourt of Tax Appeals stated7 =9e a"ree wit petitioners< contentions, t at t e criminal complaint for tax e$asion is t e assessment issued, and t at t e letter denial of >ay ,6, ,--) is t e decision properly appealable to /u0s! Respondent<s "round of denial, t erefore, t at t ere was no formal assessment issued, is untenable! =It is t e %ourt<s onest belief, t at t e criminal case for tax e$asion is already an assessment! T e complaint, more particularly, t e 5oint Affida$it of Re$enue :xaminers Da"may and Sa$ellano attac ed t ereto, contains t e details of t e assessment liCe t e Cind and amount of tax due, and t e period co$ered! ='etitioners are ri" t, in claimin" t at t e pro$isions of Republic Act No! ,,1), relatin" to exclusi$e appellate Hurisdiction of t is %ourt, do not, maCe any mention of =formal assessment!< T e law merely states, t at t is %ourt as exclusi$e appellate Hurisdiction o$er decisions of t e %ommissioner of Internal Re$enue on disputed assessments, and ot er matters arisin" under t e National Internal Re$enue %ode, ot er law or part administered by t e &ureau of Internal Re$enue %ode! =As far as t is %ourt is concerned, t e amount and Cind of tax due, and t e period co$ered, are sufficient details needed for an =assessment!< T ese details are more t an complete, compared to t e followin" definitions of t e term as #uoted ereunder! T us7 =Assessment is layin" a tax! 5o nson %ity $! %linc field R! %o!, (* S!9! @1dA *4., *46, ,.* Tenn! **1! @9ords and ' rases, 'ermanent :dition, Vol! (, p! ((.A =T e word assessment w en used in connection wit taxation, may a$e more t an one meanin"! T e ultimate purpose of an assessment to suc a connection is to ascertain t e amount t at eac taxpayer is to pay! >ore commonly, t e word =assessment< means t e official $aluation of a taxpayer<s property for purpose of taxation! State $! New JorC, N!H! and H!R! %o! 11 A! 6.), 6.4, .+ %onn! *1., *1)! @Ibid! p! (()A<

=;rom t e abo$e, it can be "leaned t at an assessment simply states ow muc tax is due from a taxpayer! T us, based on t ese definitions, t e details of t e tax as "i$en in t e 5oint Affida$it of respondent<s examiners, w ic was attac ed to t e tax e$asion complaint, more t an suffice to #ualify as an assessment! T erefore, t is assessment a$in" been disputed by petitioners, and t ere bein" a denial of t eir letter disputin" suc assessment, t is %ourt un#uestionably ac#uired Hurisdiction o$er t e instant petition for re$iew!<B/.0 As earlier obser$ed, t e %ourt of Appeals sustained t e %TA and dismissed t e petition! Hence, t is recourse to t is %ourt!/60 Ru5,n. o( &)e Cou-& o( A44e#5* T e %ourt of Appeals eld t at t e tax court committed no "ra$e abuse of discretion in rulin" t at t e %riminal %omplaint for tax e$asion filed by t e %ommissioner of Internal Re$enue wit t e Department of 5ustice constituted an 8assessmentB of t e tax due, and t at t e said assessment could be t e subHect of a protest! &y definition, an assessment is simply t e statement of t e details and t e amount of tax due from a taxpayer! &ased on t is definition, t e details of t e tax contained in t e &IR examiners< 5oint Affida$it,/40 w ic was attac ed to t e criminal %omplaint, constituted an assessment! Since t e assailed Order of t e %TA was merely interlocutory and de$oid of "ra$e abuse of discretion, a petition for certiorari did not lie! I**ue* ?en+e, CIR (,5e$ &),* e&,&,on. ISSUE@ AON &)e -e0enue o((,+e-*B A((,$#0,&CRe4o-&, ;),+) ;#* #&&#+)e$ &o &)e +-,',n#5 Co'45#,n& (,5e$ ;,&) &)e "OJ, +on*&,&u&e* #n #**e**'en&. 'etitioners submit for t e consideration of t is %ourt t e followin" issues7 8@,A 9 et er or not t e criminal complaint for tax e$asion can be construed as an assessment!

@1A 9 et er or not an assessment is necessary before criminal c ar"es for tax e$asion may be instituted! @*A 9 et er or not t e %TA can taCe co"niEance of t e case in t e absence of an assessment!B/-0 In t e main, t e %ourt will resol$e w et er t e re$enue officers< Affida$it2Report, w ic was attac ed to t e criminal %omplaint filed wit t e Department of 5ustice, constituted an assessment t at could be #uestioned before t e %ourt of Tax Appeals!

T)e Cou-&B* Ru5,n. T e petition is meritorious! M#,n I**ue@ Assessment ?EL"@ No. An #**e**'en& 'u*& 2e *en& &o #n$ -e+e,0e$ 2/ # &#14#/e-, #n$ 'u*& $e'#n$ 4#/'en& o( &)e &#1e* $e*+-,2e$ &)e-e,n ;,&),n # *4e+,(,+ 4e-,o$. T)u*, &)e NIRC ,'4o*e* # 25 4e-+en& 4en#5&/, ,n #$$,&,on &o &)e &#1 $ue, ,n +#*e &)e &#14#/e- (#,5* &o 4#/ &)e $e(,+,en+/ &#1 ;,&),n &)e &,'e 4-e*+-,2e$ (o- ,&* 4#/'en& ,n &)e no&,+e o( #**e**'en&. L,3e;,*e, #n ,n&e-e*& o( 2< 4e-+en& 4e- #nnu', o- *u+) ),.)e-#&e #* '#/ 2e 4-e*+-,2e$ 2/ -u5e* #n$ -e.u5#&,on*, ,* &o 2e +o55e+&e$ (-o' &)e $#&e 4-e*+-,2e$ (o- ,&* 4#/'en& un&,5 &)e (u55 4#/'en&. T)e ,**u#n+e o( #n #**e**'en& ,* 0,&#5 ,n $e&e-',n,n. &)e 4e-,o$ o( 5,',&#&,on -e.#-$,n. ,&* 4-o4e- ,**u#n+e #n$ &)e 4e-,o$ ;,&),n ;),+) &o 4-o&e*& ,&. Se+&,on 2<3 o( &)e NIRC 4-o0,$e* &)#& ,n&e-n#5 -e0enue &#1e* 'u*& 2e #**e**e$ ;,&),n &)-ee /e#-* (-o' &)e 5#*& $#/ ;,&),n ;),+) &o (,5e &)e -e&u-n. Se+&,on 222, on &)e o&)e- )#n$, *4e+,(,e* # 4e-,o$ o( &en /e#-* ,n +#*e # (-#u$u5en& -e&u-n ;,&) ,n&en& &o e0#$e ;#* *u2',&&e$ o- ,n +#*e o( (#,5u-e &o (,5e # -e&u-n. A5*o, Se+&,on 228 o( &)e *#'e 5#; *&#&e* &)#& *#,$ #**e**'en& '#/ 2e 4-o&e*&e$ on5/ ;,&),n &),-&/ $#/* (-o' -e+e,4& &)e-eo(. Ne+e**#-,5/, &)e &#14#/e- 'u*& 2e +e-&#,n &)#& # *4e+,(,+ $o+u'en& +on*&,&u&e* #n #**e**'en&. O&)e-;,*e, +on(u*,on ;ou5$ #-,*e -e.#-$,n. &)e 4e-,o$ ;,&),n ;),+) &o '#3e #n #**e**'en& o- &o 4-o&e*& &)e *#'e, o- ;)e&)e- ,n&e-e*& #n$ 4en#5&/ '#/ #++-ue &)e-eon. I& *)ou5$ #5*o 2e *&-e**e$ &)#& &)e *#,$ $o+u'en& ,* # no&,+e $u5/ *en& &o &)e &#14#/e-. In$ee$, #n #**e**'en& ,* $ee'e$ '#$e on5/ ;)en &)e +o55e+&o- o( ,n&e-n#5 -e0enue -e5e#*e*, '#,5* o- *en$* *u+) no&,+e &o &)e &#14#/e-.

In &)e 4-e*en& +#*e, &)e -e0enue o((,+e-*B A((,$#0,& 'e-e5/ +on&#,ne$ # +o'4u&#&,on o( -e*4on$en&*B &#1 5,#2,5,&/. I& $,$ no& *&#&e # $e'#n$ o- # 4e-,o$ (o4#/'en&. Ao-*e, ,& ;#* #$$-e**e$ &o &)e >u*&,+e *e+-e&#-/, no& &o &)e &#14#/e-*. N.%. T?E ISSUANCE OF AN ASSESSMENT MUST %E "ISTINGUIS?E" FROM T?E FILING OF A COM LAINT. %e(o-e #n #**e**'en& ,* ,**ue$, &)e-e ,*, 2/ 4-#+&,+e, # 4-eC#**e**'en& no&,+e *en& &o &)e &#14#/e-. T)e &#14#/e- ,* &)en .,0en # +)#n+e &o *u2',& 4o*,&,on 4#4e-* #n$ $o+u'en&* &o 4-o0e &)#& &)e #**e**'en& ,* un;#--#n&e$. I( &)e +o'',**,one- ,* un*#&,*(,e$, #n #**e**'en& *,.ne$ 2/ ),' o- )e- ,* &)en *en& &o &)e &#14#/e- ,n(o-',n. &)e 5#&&e- *4e+,(,+#55/ #n$ +5e#-5/ &)#& #n #**e**'en& )#* 2een '#$e #.#,n*& ),' o- )e-. In +on&-#*&, &)e +-,',n#5 +)#-.e nee$ no& .o &)-ou.) #55 &)e*e. T)e +-,',n#5 +)#-.e ,* (,5e$ $,-e+&5/ ;,&) &)e "OJ. T)e-e#(&e-, &)e &#14#/e- ,* no&,(,e$ &)#& # +-,',n#5 +#*e )#$ 2een (,5e$ #.#,n*& ),', no& &)#& &)e +o'',**,one- )#* ,**ue$ #n #**e**'en&. I& 'u*& 2e *&-e**e$ &)#& # +-,',n#5 +o'45#,n& ,* ,n*&,&u&e$ no& &o $e'#n$ 4#/'en&, 2u& &o 4en#5,De &)e &#14#/e- (o- 0,o5#&,on o( &)e T#1 Co$e. 'etitioner ar"ues t at t e filin" of t e criminal complaint wit t e Department of 5ustice cannot in any way be construed as a formal assessment of pri$ate respondents< tax liabilities! T is position is based on Section 1+) of t e National Internal Re$enue %ode/,+0 @NIR%A, w ic pro$ides t at remedies for t e collection of deficient taxes may be by eit er ci$il or criminal action! DiCewise, petitioner cites Section 11*@aA of t e same %ode, w ic states t at in case of failure to file a return, t e tax may be assessed or a proceedin" in court may be be"un without assessment! Respondents, on t e ot er and, maintain t at an assessment is not an action or proceedin" for t e collection of taxes, but merely a notice t at t e amount stated t erein is due as tax and t at t e taxpayer is re#uired to pay t e same! T us, #ualifyin" as an assessment was t e &IR examiners< 5oint Affida$it, w ic contained t e details of t e supposed taxes due from respondent for taxable years endin" ,-46 and ,-44, and w ic was attac ed to t e tax e$asion %omplaint filed wit t e DO5! %onse#uently, t e denial by t e &IR of pri$ate respondents< re#uest for rein$esti"ation of t e disputed assessment is properly appealable to t e %TA! 9e a"ree wit petitioner! Neit er t e NIR% nor t e re$enue re"ulations "o$ernin" t e protest of assessments/,,0 pro$ide a specific definition or form of an assessment! Howe$er, t e NIR% defines t e specific functions and effects of an assessment! To consider t e affida$it attac ed to t e %omplaint as a proper assessment is to sub$ert t e nature of an assessment and to set a bad precedent t at will preHudice innocent taxpayers! True, as pointed out by t e pri$ate respondents, an assessment informs t e taxpayer t at e or s e as tax liabilities! &ut not all documents comin" from t e &IR containin" a computation of t e tax liability can be deemed assessments! To start wit , an assessment must be sent to and recei$ed by a taxpayer, and must demand payment of t e taxes described t erein wit in a specific period! T us, t e NIR% imposes a 1) percent penalty, in addition to t e tax due, in case t e taxpayer fails to

pay t e deficiency tax wit in t e time prescribed for its payment in t e notice of assessment! DiCewise, an interest of 1+ percent per annum, or suc i" er rate as may be prescribed by rules and re"ulations, is to be collected from t e date prescribed for its payment until t e full payment!/,10 T e issuance of an assessment is $ital in determinin" t e period of limitation re"ardin" its proper issuance and t e period wit in w ic to protest it! Section 1+*/,*0of
t e NIR% pro$ides t at internal re$enue taxes must be assessed wit in t ree years from t e last day wit in w ic to file t e return ! Section 111,/,(0 on t e ot er and, specifies a period of ten

years in case a fraudulent return wit intent to e$ade was submitted or in case of failure to file a return! Also, Section 114/,)0 of t e same law states t at said assessment may be protested only wit in t irty days from receipt t ereof! Necessarily, t e taxpayer must be certain t at a specific document constitutes an assessment! Ot erwise, confusion would arise re"ardin" t e period wit in w ic to maCe an assessment or to protest t e same, or w et er interest and penalty may accrue t ereon! It s ould also be stressed t at t e said document is a notice duly sent to t e taxpayer! Indeed, an assessment is deemed made only w en t e collector of internal re$enue releases, mails or sends suc notice to t e taxpayer!/,.0 In t e present case, t e re$enue officers< Affida$it merely contained a computation of respondents< tax liability! It did not state a demand or a period for payment! 9orse, it was addressed to t e Hustice secretary, not to t e taxpayers! Respondents maintain t at an assessment, in relation to taxation, is simply understood to mean7 8A notice to t e effect t at t e amount t erein stated is due as tax and a demand for payment t ereof!B/,60 8;ixes t e liability of t e taxpayer and ascertains t e facts and furnis es t e data for t e proper presentation of tax rolls!B/,40 :$en t ese definitions fail to ad$ance pri$ate respondents< case! T at t e &IR examiners< 5oint Affida$it attac ed to t e %riminal %omplaint contained some details of t e tax liabilities of pri$ate respondents does not ipso facto maCe it an assessment! T e purpose of t e 5oint Affida$it was merely to support and substantiate t e %riminal %omplaint for tax e$asion! C5e#-5/, ,& ;#* no& 'e#n& &o 2e # no&,+e o( &)e &#1 $ue #n$ # $e'#n$ &o &)e 4-,0#&e -e*4on$en&* (o- 4#/'en& &)e-eo( ! T e fact t at t e %omplaint itself was specifically directed and sent to t e Department of 5ustice and not to pri$ate respondents s ows t at t e intent of t e commissioner was to file a criminal complaint for tax e$asion, not to issue an assessment! Alt ou" t e re$enue officers recommended t e issuance of an assessment, t e commissioner opted instead to file a criminal case for tax e$asion! 9 at pri$ate respondents recei$ed was a notice from t e DO5 t at a criminal case for tax e$asion ad been filed a"ainst t em, not a notice t at t e &ureau of Internal Re$enue ad made an assessment!

In addition, w at pri$ate respondents sent to t e commissioner was a motion for a reconsideration of t e tax e$asion c ar"es filed, not of an assessment, as s own t us7 8T is is to re#uest for reconsideration of t e tax e$asion c ar"es a"ainst my client, 'AS%OR Realty and De$elopment %orporation and for t e same to be referred to t e Appellate Di$ision in order to "i$e my client t e opportunity of a fair and obHecti$e earin"B/,-0 A$$,&,on#5 I**ue*@ Assessment Not Necessary Before Filing of Criminal Complaint 'ri$ate respondents maintain t at t e filin" of a criminal complaint must be preceded by an assessment! T is is incorrect, because Section 111 of t e NIR% specifically states t at in cases w ere a false or fraudulent return is submitted or in cases of failure to file a return suc as t is case, proceedin"s in court may be commenced without an assessment! ;urt ermore, Section 1+) of t e same %ode clearly mandates t at t e ci$il and criminal aspects of t e case may be pursued simultaneously! In Ungab v. Cusi,/1+0 petitioner t erein sou" t t e dismissal of t e criminal %omplaints for bein" premature, since is protest to t e %TA ad not yet been resol$ed! T e %ourt eld t at suc protests could not stop or suspend t e criminal action w ic was independent of t e resolution of t e protest in t e %TA! T is was because t e commissioner of internal re$enue ad, in suc tax e$asion cases, discretion on w et er to issue an assessment or to file a criminal case a"ainst t e taxpayer or to do bot ! 'ri$ate respondents insist t at Section 111 s ould be read in relation to Section 1)) of t e NIR%,/1,0 w ic penaliEes failure to file a return! T ey add t at a tax assessment s ould precede a criminal indictment! 9e disa"ree! To reiterate, said Section 111 states t at an assessment is not necessary before a criminal c ar"e can be filed! T is is t e "eneral rule! 'ri$ate respondents failed to s ow t at t ey are entitled to an exception! >oreo$er, t e criminal c ar"e need only be supported by a prima facie s owin" of failure to file a re#uired return! T is fact need not be pro$en by an assessment! T e issuance of an assessment must be distin"uis ed from t e filin" of a complaint! &efore an assessment is issued, t ere is, by practice, a pre2assessment notice sent to t e taxpayer! T e taxpayer is t en "i$en a c ance to submit position papers and documents to pro$e t at t e assessment is unwarranted! If t e commissioner is unsatisfied, an assessment si"ned by im or er is t en sent to t e taxpayer informin" t e latter specifically and clearly t at an assessment as been made a"ainst im or er! In contrast, t e criminal c ar"e need not "o t rou" all t ese! T e criminal c ar"e is filed directly wit t e DO5! T ereafter, t e taxpayer is notified t at a criminal case ad been filed a"ainst im, not t at t e commissioner as issued an assessment! It must be stressed t at a criminal complaint is instituted not to demand payment, but to penaliEe t e taxpayer for $iolation of t e Tax %ode!

A?EREFORE, t e petition is ereby GRANTED! T e assailed Decision is REVER ED and ET A !DE! %TA %ase No! )16, is liCewise D! "! ED! No costs! SO OR"ERE". Vitug, #urisima, and Gon$aga%Re&es, ''., concur. Romero (Chairman), '., abroad on official business!

S!NO SIS On >arc ,, ,--), t e %ommissioner of Internal Re$enue @%IRA filed a criminal complaint before t e Department of 5ustice a"ainst respondents alle"in" e$asion of taxes! 'ri$ate respondents t en filed a re#uest for reconsideration and rein$esti"ation! T e %IR denied said re#uest on t e "round t at no formal assessment as been issued! T e matter was ele$ated to t e %ourt of Tax Appeals @%TAA! T e %IR mo$ed to dismiss! T e %TA denied said motion to dismiss and eld t at t e criminal complaint for tax e$asion was already an assessment! T e %ourt of Appeals affirmed t e %T AKs denial! Hence, t is petition! T e re$enue officersK affida$it attac ed to t e criminal complaint merely contained a computation of respondentsK tax liability! It did not state a demand or a period of payment! It was addressed to t e Hustice secretary, not to t e taxpayers! As to t e respondentsK contention t at t e filin" of a criminal complaint must be preceded by an assessment, t e %ourt ruled t at t is was incorrect! Section 111 of t e NDR% especially states t at in cases of failure to file a return suc as t is case, proceedin"s in court may be commenced wit out an assessment! A criminal complaint is instituted not to demand payment, but to penaliEe t e taxpayer for $iolation of t e Tax %ode! S!LLA%US
1. TAEATIONF TAEF ASSESSMENTF CONSTRUE". L An assessment must be sent to and recei$ed by a taxpayer, and must demand payment of t e taxes described t erein wit in a specific period! T e issuance of an assessment is $ital in determinin" t e period of limitation re"ardin" its proper issuance and t e period wit in w ic to protest it! Necessarily, t e taxpayer must be certain t at a specific document constitutes an assessment! Ot erwise, confusion would arise re"ardin" t e period wit in w ic to maCe an assessment or to protest t e same, or w et er interest and penalty may accrue t ereon! It s ould also be stressed t at t e said document is a notice duly sent to t e taxpayer! Indeed, an assessment is deemed made only w en t e collector of internal re$enue releases, mails or sends suc notice to t e taxpayer! 2. I".F I".F REVENUE OFFICERGS AFFI"AVIT AIT?OUT "EMAN" OR ERIO" OF A!MENT, NOT AN ASSESSMENT. 2 In t e present case, t e re$enue officersK Affida$it merely contained a computation of respondentsK tax liability! It did not state a demand or a period for payment! 9orse, it was addressed to t e 5ustice Secretary, not to t e taxpayers! T at t e &IR examinersK 5oint Affida$it attac ed to t e %riminal %omplaint contained some details of t e tax liabilities of pri$ate respondents does not ipso facto maCe it an assessment! T e purpose of t e 5oint Affida$it was merely to support and substantiate t e %riminal %omplaint for tax e$asion! %learly, it was not meant to be a notice of t e tax due and a demand to t e pri$ate respondents for payment t ereof!

3. I".F I".F FALSE OR FRAU"ULENT RETURNSF ROCEE"INGS IN COURT MA!%E COMMENCE" I AIT?OUT ASSESSMENT. 2 Section 111 of t e NIR% specifically states t at in cases w ere a false or fraudulent return is submitted or in cases of failure to file a return suc as t is case, proceedin"s in court may be commenced without an assessment! ;urt ermore, Section 1+) of t e same %ode clearly mandates t at t e ci$il and criminal aspects of t e case may be pursued simultaneously! H. I".F I".F I".F I".F ROTEST AILL NOT STO OR SUS EN" CRIMINAL ACTION. 2 In Ungab v. Cusi, petitioner t erein sou" t t e dismissal of t e criminal %omplaints for bein" premature, since is protest to t e %TA ad not yet been resol$ed! T e %ourt eld t at suc protests could not stop or suspend t e criminal action w ic was independent of t e resolution of t e protest in t e %TA! T is was because t e commissioner of internal re$enue ad, in suc tax e$asion cases, discretion on w et er to issue an assessment or to file a criminal case a"ainst t e taxpayer or to do bot ! 5. I".F I".F ASSESSMENT "ISTINGUIS?E" FROM FILING OF COM LAINT. 2 T e issuance of an assessment must be distin"uis ed from t e filin" of a complaint! &efore an assessment is issued, t ere is, by practice, a pre2assessment notice sent to t e taxpayer! T e taxpayer is t en "i$en a c ance to submit position papers and documents to pro$e t at t e assessment is unwarranted! If t e commissioner is unsatisfied, an assessment si"ned by im or er is t en sent to t e taxpayer informin" t e latter specifically and clearly t at an assessment as been made a"ainst im or er! In contrast, t e criminal c ar"e need not "o t rou" all t ese! T e criminal c ar"e is filed directly wit t e DO5! T ereafter, t e taxpayer is notified t at a criminal case ad been filed a"ainst im, not t at t e commissioner as issued an assessment! It must be stressed t at a criminal complaint is instituted not to demand payment, but to penaliEe t e taxpayer for $iolation of t e Tax %ode!

EARANCES OF COUNSEL

The o*icitor Genera* for petitioner. De Gu$man Ce*is +aw ,ffice for private respon-ents.