MISNET, INC., v. CIR

 Doctrine: For a party to seek exception for its failure to comply strictly with the statutory requirements for perfecting its appeal, strong compelling reasons such as serving the ends of justice and preventing a grave miscarriage thereof must be shown, in order to warrant the Court's suspension of the rules. Indeed, the Court is confronted with the need to balance stringent application of technical rules vis-a-vis strong policy considerations of substantial significance to relax said rules based on equity and justice.

Facts: Petitioner received a PAN. Petitioner then filed a letter-protest on the PAN. Petitioner received a FAN. Petitioner paid for certain undisputed assessments. On the same day, petitioner administratively protested the FAN by filing a request for reconsideration. The CIR acknowledged receipt of the payment and the protest letter and informed the petitioner that its tax docket had been forwarded to RDO North Makati. Petitioner sent a letter to Revenue Officer Paralejas reiterating its protest to the PAN and the FAN. CIR again wrote a letter to petitioner informing it that it found additional deficiency taxes due. Petitioner received an Amended Assessment Notice reflecting an amended deficiency EWT after reinvestigation. On the same date, petitioner received an FDDA stating that after reinvestigation, there was still due from petitioner. This FDDA was received by petitioner on March 28, 2011. 

On April 8, 2011, petitioner filed a letter-reply to the Amended Assessment Notice and FDDA, which was received by the CIR on April 11, 2011. On May 9, 2011, the CIR sent a letter to petitioner which states in part that petitioner's letter-reply dated April 8, 2011 produced no legal effect since it availed of the improper remedy. It should have appealed the final decision of the CIR to the CTA within thirty days from the date of receipt of the said Decision, otherwise, the assessment became final, executory and demandable. On May 27, 2011, petitioner filed a Petition for Relief from Judgment with respondent Commissioner arguing that it was not able to file its proper appeal of the FDDA due to its mistake and excusable negligence as it was not assisted by counsel. On June 29, 2011, petitioner received a Preliminary Collection Letter dated June 22, 2011, which is deemed a denial of petitioner's Petition for Relief.

Petitioner filed a Petition for Review with the CTA. Meanwhile, the CIR filed a Motion to Dismiss the petition on the ground of lack of jurisdiction. The motion to dismiss was granted. Petitioner filed a motion for reconsideration but it was denied. Petitioner filed a Petition for Review with the CTA En Banc but it was dismissed.

Issue: Whether or not the CTA gravely erred in dismissing the petition for review for lack of jurisdiction.

Held: For a party to seek exception for its failure to comply strictly with the statutory requirements for perfecting its appeal, strong compelling reasons such as serving the ends of justice and preventing a grave miscarriage thereof must be shown, in order to warrant the Court's suspension of the rules. Indeed, the Court is confronted with the need to balance stringent application of technical rules vis-a-vis strong policy considerations of substantial significance to relax said rules based on equity and justice. 

Petitioner's belated filing of an appeal with the CTA is not without strong, compelling reason. We could say that petitioner was merely exhausting all administrative remedies available before seeking recourse to the judicial courts. While the rule is that a taxpayer has 30 days to appeal to the CTA from the final decision of the CIR, the said rule could not be applied if the Assessment Notice itself clearly states that the taxpayer must file a protest with the CIR or the Regional Director within 30 days from receipt of the Assessment Notice. Under the circumstances obtaining in this case, we opted not to apply the statutory period within which to appeal with the CTA considering that no final decision yet was issued by the CIR on petitioner's protest. The subsequent appeal taken by petitioner is from the inaction of the CIR on its protest.