PEOPLE OF THE PHILIPPINES VS.

GLORIA V. KINTANAR

This is a Petition for Review filed by petitioner from the decision of CTA Division finding
him guilty of violation of Section 255 of the National Internal Revenue Code of1997, as
amended, and is hereby SENTENCED to sufferan indeterminate penalty of one (1)
year, as minimum, to
two (2) years, as maximum, and is ORDERED to pay afine in the amount of
P10,000.00.
FACTS:
Petitioner is engaged in business and earning income as distributor of Forever Living
Products Philippines, Inc., with obligation under the law to file her Income Tax Return
(ITR) for the taxable year 2000 and fails to file her ITR with the Bureau of Internal
Revenue for the year 2000, to the damage and prejudice of the Government in the
estimated amount of Pl ,329,319.95 exclusive of penalties, surcharges and interest.
After the initial investigation, the investigating team found that spouses Kintanar were
able to generate a large amount of income, as distributors or independent contractors of
FLPPI.
LOA was issued, Sps. Kintanar failed to submit the required documents. A Final Notice
was issued, still Sps. Failed to submit the required documents. On December 9, 2003,
a Preliminary Assessment Notice, together with the details of discrepancies, for taxable
years 1999 to 2002, were issued by the BIR and sent to spouses Kintanar, giving them
15 days to explain the discrepancies. Again, spouses Kintanar failed to comply.
A formal letter of demand was issued demanding them to pay their deficiency income
and VAT liabilities. A letter of protest was filed by the husband who undertook to submit
additional documents and agreements,within 60 days thereof. The Chief of the National
Investigation Division sent a notice to Sps. Informing them that no documents received
and they only have 60 days to submit such from filing of their letters of protest. Still Sps
failed to do so.
The assessment had become final, executor and demandable. Based on said
investigation, and the documents obtained, the prosecution found that petitioner failed
to file her ITRs for the years 1999 to 2001 and found her liable for deficiency income
taxes, arising from income earned from FLPPI.
SPS DEFENSES

Petitioner Gloria V. Kintanar, the first witness for the defense, substantially testified that
she filed her ITRs for taxable years 2000 and 2001on March 28, 2001 and April 5, 2002
respectively that she has no personal knowledge of actual filing of said returns because
it was her husband who filed their ITRs;
Her husband on the other hand contended that he was the one who filed their ITRs; that
they filed joint ITRs from years 1997 to 2004,through their hired accountant, Marina
Mendoza; that it was Mendoza who prepared the ITRs; that he gave all the documents
necessary for filing the ITRs, specifically W2 Forms (Creditable Tax Withheld
Cetiificates) toMendoza; that he relied on Mendoza in preparing their ITRs; that he just
browsed the ITRs; thus, he has no knowledge of the amount and address stated therein
and where their ITRs were filed.
SECOND DIVISION RULING:
found petitioner guilty beyond reasonable doubt of Violation of Section 2 55of the NIRC
of 1997, as amended, in both C.T.A. Crim. Case Nos. 0-033 and 0-034.. They filed their
MR, but was denied. Hence, this Petition for Review was filed before the CTA en banc.
The latter affirmed CTA Second Divisions ruling.
ISSUE:
Whether or not CTA en banc erred in convicting Kintanar for their violation under
Section 255 of NIRC OF 1997
RULING:
NO.
Section 255 of the NIRC of 1997
"SEC. 255. Failure to File Return, Supply Correct and
Accurate Information, Pay Tax, Withhold and Remit Tax, and
Refund Excess Taxes Withheld on Compensation.- Any
person required under this Code or by rules and
regulations promulgated thereunder to pay any tax, mal{e
a return, keep any record, or supply correct and accurate
information, who willfully fails to keep any record, or supply
such correct and accurate information, or withhold or remit
taxes withheld, or refund excess taxes withheld on
compensation, at the time or times required by law or
rules and regulations shall, in addition to other penalties

provided by law, upon conviction thereof, be punished by a

fine of not less than Ten thousand pesos (P10,000) and
suffer imprisonment of not less than one(1) year but not
more than ten (10) years.
PERSON REQUIRED TO MAKE
OR FILE A RETURN
Section 51 of the NIRC of 1997, as amended, provides:
"SEC. 51. Individual Return.
(A) Requirements.(l)Except as provided in paragraph (2) of this Subsection, the
following individuals are required to fi le an income tax return:
(a) Every Filipino citizen residing in the Philippines;
XXX XXX
(4) The income tax return shall be filed in duplicate by the
following persons:
(a) A resident citizen- on his income from all sources;
XXX XXX
(D) Husband and Wife. - Married individuals, whether citizens,
resident or nonresident aliens, who do not derive income
purely from compensation, shall file a return for the taxable
year to include the income of both spouses, but where it is
impracticable for the spouses to file one return, each spouse
may file a separate return of income but the returns so filed
shall be consolidated by the Bureau for purposes of
verification for the taxable year."
Petitioner admitted that she received the checks issued by FLPPI, as her
payment/commission, which she encashed or cleared at the BPI Nmih-Greenhills,
wherein she maintains an Account no. 257004248
Considering that petitioner earned a substantial income, as distributor/independent
contractor of FLPPI; she is, therefore, required to make or file her annual income tax
return, pursuant to the afore quoted provisions.

PETITIONER FAILED TO MAKE OR

FILE THE RETURN AT THE TIME
REQUIRED BYLAW
Pursuant to Section 51, subsections (B) and (C) (1) , of the NIRC of1997, as amended,
a person with legal residence or principal place of business in the Philippines, shall file
his return with an authorized agent bank, Revenue District Officer, Collection Agent or
duly authorized Treasurer of the city or municipality. The return shall be filed on or
before the 15th day of April of each year covering income for the preceding taxable
year.
Under the above-provision, petitioner was supposed to register, file her ITR and pay the
corresponding income taxes due with the authorized agent bank, RDO, Collection Agent
or duly authorized Treasurer of the city, where she has her legal residence or principal
place of business. However,
upon thorough investigation and from the evidence adduced by the prosecution,
petitioner has no record of filing of the required ITRs, within the reglementary period,
with any of the RDOs of the BIR.
upon verification of Assistant Commissioner Alberto A. Pio de Roda of the Information
Systems Operations Service of the BIR, there is no record showing that petitioner has
filed her ITRs for years 1999
to 2001. The only existing record of petitioner is that she was registered as a "one-time
transaction taxpayer" for capital gains and documentary stamp tax, at RDO No. 54 of
Trece Martires City, Cavite.

THE FAILURE TO MAKE OR

FILE A RETURN WAS WILLFUL
First, under the law, petitioner and her husband, as married individuals, who do not
derive
income purely from compensation, are obliged to file their ITRs for taxable years 2000
and 2001 for the income they earned, as distributors/independent contractors of FLPPI.
Thus, petitioner's sole reliance on her husband to file their ITRs is not a valid reason to
justify her non-filing, considering that she
knew from the start that she and her husband are mandated by law to file their ITRS.
Second, being an experienced businesswoman, and having been an independent
distributor/contractor of FLPPI since 1996, petitioner ought to know and understand all
the matters concerning her business. She must have knowledge and awareness of her

tax obligation in connection with her business. Petitioner should know how much are her
tax dues, the details stated on the ITRs, where the same are filed, and other important
facts related to the filing of her ITRs; after all, these matters concern her finances.
Despite the several notices given to petitioner starting from April 3,2003, the evidence
on record shows that only a protest letter made by petitioner's husband dated August
31, 2004 was the reply given by the petitioner. It took petitioner more than one year to
send said reply. Evidently, such non-compliance with the BIR's notices clearly shows
petitioner's intent not to file her ITRs.
WHEREFORE, premises considered, the present Petition for Review
IS hereby DENIED.