Report On Sec 220 To 227 of NIRC

Form and Mode
of Proceeding
in Actions
Civil and Criminal actions
and proceedings;
Shall be enforced by BIR,
Shall be brought in the name of Gov. of PH and,
Shall be conducted by legal officers of BIR
Every actions filed for recovery and enforcement of

penalty with court shall be with the approval of the
Commissioner otherwise void.(Sec. 220)
Remedy for Enforcement
of Statutory Penal Provisions
Either by criminal or civil action (judicial remedies)
-depending on the situation
-subject to the approval of the
Commissioner(Sec. 221)
Period of limitation of Assessment
and Collection of Taxes; Exceptions
Gen. Rule: Prescriptive period to collect taxes is five years
from the date of assessment.
Exceptions:
a.) False or fraudulent return with intent to evade taxes:
within 10 years from discovery without need for prior
assessment. The government may file a proceeding in court.
[Sec. 222(A)].
b.)Failure or omission to file a return: within 10 years from
discovery without need for assessment. (Sec. 222(A))
c.) Waiver in writing executed before the five-year period
expires: period agreed upon. (Sec. 222(B))
Any internal revenue tax
may be collected by:
(1) distraint or levy or
(2) by a proceeding in court
within five(5) years following the
assessment of the tax. (Sec. 222(C))
The tax is deemed collected if:
(1) it is through summary remedies, when the gov.

avails of a distraint and levy procedure under the NIRC.
Distraint and levy proceedings are commenced by the issuance
of the warrant and service to the taxpayer.
(BPI v. CIR, GR 139736)
(2) It is through judicial remedies
(criminal or civil), when the government
files the complaint with the proper court.
It may be initiated by filing a complaint w/ regular trial
court, or where assessment is appealed to the CTA, by
filing an answer to the taxpayers petition for review
wherein payment of the tax is prayed for. (PNOC v. CA)
Is the 10 year period still applicable for
collection despite the fact that assessment
was previously made?
Republic v. Ret,
G.R. No. L-13754,
March 31, 1962
Facts: It was Feb. 23, 1949 when Damian Ret filed his income
return with BIR. BIR found out that the return filed by Ret was
fraudulent when he was assessed with deficiency income tax.
So on Jan. 20, 1951, CIR issued income tax assessment
notices to RET urging him to pay buy the latter failed/refused
to pay the sums. He was sentenced to pay a fine of Php 300.
On Sept. 21, 1957, the Republic filed the complaint for
recovery of RETs deficiency taxes. The defendant on the
other hand filed a motion to dismiss and claimed that the
cause of action had already prescribed.
ISSUE: Whether or not governments
cause of action had already prescribed
Rulling: Affirmative.
An assessment against the taxpayer takes the case out of the
provisions of Section 222(A) and places it under Section
222(C), which gives the government only five years from the
date the assessment was made to collect.
The Plaintiff-Appelant (Republic) made the assessment on

Jan. 20, 1951 and had up to January 20, 1956 to file the
necessary action. It was only on Sept. 5, 1957, that an action
was filed in court for the collection of alleged deficiency
income tax far beyond the 5 year period.
Regular return was made False, Fraudulent , or Failure to File
A Return
Assessment: 3 years Assessment: 10 years, from discover
Collection: 5 years from assessment Collection: 5 years, from assessment
If government does not make an

assessment, they can collect within 10
years from discovery.
They are however, limited to purely

judicial remedies. (Sec. 222[A])
CIR vs ASALUS
CORPORATION
G.R. 221590
Feb. 22, 2017
Facts: On Jan. 10 2011, CIR issued PAN finding ASALUS
liable for deficiency VAT for 2007. Protest was filed
but it was denied.
On Aug. 26, 2011, ASALUS received FAN for
deficiency VAT for 2007. ASALUS filed a protest
against FAN and thereafter filed a supplemental
protest stating that the assessment had prescribed
pursuant to Sec. 203 of the NIRC. (3 years)
ISSUE: Whether petitioners right to assess
respondent for its deficiency VAT for taxable
year 2007 had already prescribed.
HELD: Negative. Generally, interenal revenue taxes shall be
assessed within 3 years after the last day prescribed by law for
the filing of the return, or where the return is filed beyond the
period, from the day the return was actually filed. Sec. 222 of
the NIRC, however provides for exceptions to the general rule.
It states that in the case of a false or fraudulent return with

intent to evade tax or of failure to file a return, the
assessment may be made within ten years from the discovery
of the falsity, fraud or omission.
Case remanded to CTA for determination of VAT liabilities of

ASALUS.
Suspension of Running of
Statute of limitations(Sec.223)
The running of the prescriptive period for both
the power to assess and the power to collect
can be suspended in the following situations:
when the CIR is prohibited from making an

assessment or beginning distraint and levy or
a proceeding in court and for 60 days
thereafter
The running of the prescriptive period for both
the power to assess and the power to collect
can be suspended in the following situations:
when the CIR is prohibited from making an

assessment or beginning distraint and levy or
a proceeding in court and for 60 days
thereafter
When the taxpayer requests for
reinvestigation which is granted by the
CIR
When the taxpayer cannot be located in
the address given by him in the return
filed, unless he informs the CIR of the
change of address.
When the warrant of distraint and levy
is duly served upon the taxpayer or
authorized representative and no
property could be located.
When the taxpayer is out of the
Philippines.
Remedy for Enforcement of Forfeitures.(Sec.
224)
Forfeiture of chattels and removable fixtures:
It shall be enforced by the seizure and sale or
destruction of the specific forfeited property.
Forfeiture of real property:

It shall be enforced by a judgment and sale in a legal
action or proceeding, civil or criminal, as the case may
require.
When property to be sold or Destroyed.
Forfeited chattels and removable fixtures

The sale shall be made in accordance with the terms and
conditions made in public notice.
Liqours, cigarettes etc.
Upon order of Commissioner, be destroyed if the sale for use or
consumption would be detrimental to the health of public or
prejudicial to the enforcement of law.
Forfeited property shall not be destroyed

until at least twenty days after seizure.(sec.
225)
Funds Recovered in Legal Proceedings or
Obtained from forfeitures shall be paid or be
disposed of in favor of the Commissioner or
his duly authorized deputies(Sec. 226)
Satisfaction of Judgment Recovered Against
any Internal Rev. Officer.(Sec. 227)
The Commissioner shall satisfy the judgment,
damages or costs recovered in an action filed
against an IRO by reason of his duty upon
approval of Secretary of Finance.
However such shall not be paid to the person who

has acted negligently or in bad faith, or with willful
oppression.

Report On Sec 220 To 227 of NIRC

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Report On Sec 220 To 227 of NIRC

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Form and Mode

Every actions filed for recovery and enforcement of

(1) it is through summary remedies, when the gov.

The Plaintiff-Appelant (Republic) made the assessment on

Collection: 5 years from assessment Collection: 5 years, from assessment

If government does not make an

They are however, limited to purely

It states that in the case of a false or fraudulent return with

Case remanded to CTA for determination of VAT liabilities of

when the CIR is prohibited from making an

when the CIR is prohibited from making an

Forfeiture of real property:

Forfeited chattels and removable fixtures

Forfeited property shall not be destroyed

However such shall not be paid to the person who

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