By Rey E. Requejo
The Supreme Court (SC) has sustained the decision of the Court of Tax Appeals absolving retired Lt. Gen. Jacinto C. Ligot and his wife Erlinda of four counts of tax evasion for willful under-declaration of income from 2001 to 2004 amounting to P458 million.
In a 20-page decision, the SC’s Third Division through Associate Justice Henri Jean Paul Inting held that the CTA Third Division did not commit grave abuse of discretion in dismissing the tax evasion case against the Ligots.
The CTA Third Division, in a decision rendered last January 8, 2019, declared that the prosecution failed to prove that the couple are guilty beyond reasonable doubt of violation of Section 254 ( Attempt to Evade or Defeat Tax) and 255 (Failure to File Return, Supply Correct and Accurate Information, Pay Tax Withhold and Remit Tax and Refund Excess Taxes Withheld on Compensation) of the National Internal Revenue Code or the Tax Code.
On October 5, 2019, the appellate tax court issued a resolution denying the motion for reconsideration (MR) filed by the Bureau of Internal Revenue (BIR) and the Department of Justice (DOJ).
The case stemmed from the investigation conducted by the BIR on the books of account of the respondents which showed real and personal tangible properties which they acquired either directly by any one of them or indirectly through a third person during the taxable years 2001 to 2004.
These include several parcels of land, condominium units, a Toyota Hilux vehicle, bank deposits and other properties.
The investigation showed that the spouses’ property acquisitions, bank deposits and investments to be grossly disproportionate to what they actually declared in their Statement of Assets, Liabilities and Net Worth (SALN) and Income Tax Return (ITR).
In junking the tax evasion case, the CTA ruled that the prosecution’s theory in all four criminal cases were founded largely on the alleged existence of the spouses’ bank deposits, investments, and other financial affairs.
But the CTA said the entire body of evidence offered by the prosecution to support its theory such as bank statements and documents are excluded by law, thus inadmissible.
The CTA also held that the exceptions to the bank secrecy laws cannot be extended to apply to tax evasion cases.
Finally, the CTA Third Division concluded that the evidence relied upon by the prosecution have either been excluded or were found to have insufficient probative value due to the prosecution’s failure to establish their authenticity and execution.
In upholding the CTA’s Third Division’s ruling, the SC stressed that it “resolved the case only after all the evidence was considered, weighed, and passed upon.”
“In view of the foregoing, the Court finds that there was nothing capricious, whimsical, or even arbitrary in the CTA’s ruling that the prosecution failed to establish accused-respondents’ guilt beyond reasonable doubt,” the Court said.