- Petitioner
- Commissioner of Internal Revenue
- Respondent
- B.F. Goodrich Phils.
- Citation
- G.R. No. 104171
- Court
- From Bureau of Internal Revenue (BIR) to Court of Tax Appeals (CTA) to Court of Appeals (CA) to Supreme Court (SC)
- Division
- Third Division
- Ponente
- Panganiban, J.
- Decided
- February 24, 1999
Summary
This Supreme Court case resolved whether the Bureau of Internal Revenue can assess deficiency donor's tax beyond the five-year prescriptive period. B.F. Goodrich, facing loss of land ownership rights due to Parity Amendment expiration, sold Basilan plantation land below declared market value. After paying initial income tax assessment in 1975, BIR issued donor's tax assessments in 1980-1981, claiming the price difference constituted taxable donation. The Court of Tax Appeals upheld the assessments based on alleged falsity, but the Court of Appeals reversed, finding insufficient grounds to overcome prescription. The Supreme Court affirmed, ruling that mere sale below market value without proof of fraudulent intent cannot justify assessment beyond the statute of limitations. The decision emphasizes taxpayer protection through strict construction of prescription exceptions and confirms that BIR negligence cannot prejudice taxpayers' rights to finality in tax obligations.