PEOPLE vs. MAGDALUYO (Tax 2)

G.R. No. L-16235             April 20, 1961

PEOPLE OF THE PHILIPPINES, plaintiff-appellant,

vs.

CARLOS MAGDALUYO, defendant-appellee.

Office of the Solicitor General for plaintiff-appellant.

Antonio N. Lobin for defendant-appellee.

FACTS:

An information was filed that Magdaluyo did then and there wilfully, unlawfully, and feloniously and notwithstanding repeated demands failed and refused to pay the specific tax in the amount of P24,43840, due from him, to the damage and prejudice of the government in the aforestated amount of P24,438.

One week after the filing of said information, i.e., on August 17, 1959, defendant paid the Bureau of Internal Revenue the balance of the specific tax in the sum of P4,438.40, as well as the compromise penalty in the sum of P1,000.00 (a total of P5,438.40) under O.R. No. A-724051.

Defendant filed a motion to quash the same, on the ground that "the criminal liability of the accused has been extinguished" by his full payment on August 17, 1958, of his tax liability and penalty pursuant to the compromise agreement with the Commissioner of Internal Revenue and consented to originally by the City Attorney of Pasay. To this motion, the Assistant City Attorney filed an opposition, the court dismissed the case, in an order of this tenor.

ISSUE:

Whether the trial court erred in dismissing the case since the information charging defendant with the offense in question was filed prior to his (defendant's) full payment of the tax liability and compromise penalty, the Commissioner of Internal Revenue lost the authority to compromise 1 the criminal aspect of the tax case.

RULING:

We find no merit in the contention. The argument might be correct had no compromise agreement been entered into between defendant and the Commissioner, with the knowledge of and concurrence by the Pasay City Fiscal, prior to the filing of the information (on August 17, 1959) or that there was non-compliance with the compromise agreement. The records disclose that the Commissioner of Internal Revenue has agreed to compromise the case (see memorandum Annex I), and that the Pasay City Fiscal, upon being advised thereof has expressed his conformity to the agreement, considering the case as "closed and terminated". (See letter quoted above, dated January 24, 1959, or 7 months prior to the filing of the information on August 10, 1959).

Nor is there non-compliance with the compromise agreement which set no specific date within which defendant must fully pay the tax and penalty. In fact, the Commissioner of Internal Revenue agreed to the payment of said tax and penalty in installments (see letter of the Commissioner, Annex "L"), and defendant appears to have made payment as follows: P5,000.00 on February 16, 1959, P5,000.00 on March 16, 1959, P5,000.00 on May 19, 1959, P5,000.00 on July 7, 1959, and P5,438.40, on August 17, 1959.