Thello Dalanon ATTY. KIM HENARES’s IGNORANCE OF THE LAW AND INEXCUSABLE MISTAKE AS THEN PHILIPPINES INTERNAL REVENUE COMMISSIONER. 1. Kim Henares, on February 28, 2014, told GMA-7 in a telecast interview that my tax assessment against “Dunkin’ Donuts” show Read more ... ed inaccuracies. However, Henares and BIR Deputy Commissioner Estela Sales, in their counter-affidavits, and even the supporting affidavits of Atty. Rommel Curiba and Mr. Wilfredo Reyes, both of the BIR national office, did not give any justifications or explanations to dispute all the glaring and crucial issues included in my audit findings that were clearly stated in the Formal Complaint I filed against them before the Office of the Ombudsman. Despite respondents Henares’s and Sales’s failure to refute, the Ombudsman dismissed the case without conducting a thorough investigation and without requiring the respondents to submit “Dunkin’ Donuts” tax case docket and copy of its actual “protest” which are very essential in the investigation. The Ombudsman, in its dismissal resolution, did not discuss the merits of the case and did not state the facts and law upon which the conclusion given were drawn. AMAZING!!! 2. Henares’s ignorance of the law and inexcusable mistake as then internal revenue commissioner. I expressed my firm stance that the P1.56-B tax assessment against “Dunkin’ Donuts” attained finality based on the following grounds: a. DD failed to file a VALID protest; and b. DD failed to submit the required documents within the period required by law. Henares, in her counter-affidavit, states: “Mr. Dalanon, as then Revenue Officer, has no authority – and could not arrogate upon himself – to decide and declare that a certain assessment is already final, executory, and demandable. THIS IS A FUNCTION VESTED BY LAW UPON THE COMMISSIONER OF INTERNAL REVENUE OR HER DULY AUTHORIZED REPRESENTATIVES.” Henares’s statement does not find basis in law. Her claim is erroneous, because it is the law that determines finality of an assessment as clearly provided under Revenue Regulations No. 12-99 in relation to Section 228 of the 1997 National Internal Revenue Code, as amended. The Ombudsman dismissed the case without studying tax assessment rules. WONDERFUL!!! 3. Henares, in her counter-affidavit, denied knowledge of “Dunkin’ Donuts” irregularities; but admitted that she received my audit report on September 3, 2010. --- Therefore, she knew about it. I personally reported to her “Dunkin’ Donuts” omissions and recommended to her the criminal prosecution of the company for tax evasion under the much-vaunted Run After Tax Evaders (RATE) program of the Bureau. Atty. Jethro M. Sabariaga, who was then her Chief of Staff, knew very well that I personally talked to Henares about the case. In fact, Atty. Sabariaga first read my audit report before it was handed over to Henares. “Othello, di ka ba natatakot sa ginagawa mo? – That’s Atty. Sabariaga asking. To which I replied – trabaho lang ho sir. So if Henares didn’t know about “Dunkin’ Donuts” case as she claimed, what did Atty. Sabariaga report to her? -- Was it about the filmed story of “ASIONG SALONGA”? It was Henares who introduced me to Deputy Commissioner Estela Sales to whom she referred the case for evaluation by the RATE team to determine existence of fraud – “ganito ang gusto kong mga kaso” – Estela Sales even exclaimed! The evaluation conducted by the RATE team to determine existence of fraud resulted in the AFFIRMATIVE as relayed to me by a BIR official who requested anonymity. The informant further told me that the RATE team was then already preparing the memorandum to recommend the criminal prosecution of the doughnut company for tax evasion, but discontinued upon instruction by a high-ranking official of the Bureau whose name the informant did not disclose. There are documents to prove that Henares was properly apprised of the “Dunkin’ Donuts” tax case. These were attached to my Formal Complaint against Henares and Estela Sales filed before the Ombudsman. As I said, the Ombudsman dismissed the case. SURPRISING!!! 4. Henares, in her counter-affidavit, denied that she ordered “two re-investigations”. However, on February 28, 2014, in a telecast interview by GMA-7, she admitted that she had the doughnut company’s tax case re-investigated for several times (twice). “pinaimbestiga natin ng ilan beses, at yong mga imbestigasyon na yon, lumalabas na hindi naman tama ang assessment ni Mr. Othello [Dalanon]” – Henares said. This is what happened to the “two reinvestigations”. The “first re-investigation”, which is no longer warranted because my tax assessment which remained undisturbed after review and evaluation by high-ranking officers in the district and regional levels of the Bureau and already covered by Final Assessment Notices (FANs), all bearing Demand No. 41-B072-07 and all dated October 29, 2010, attained finality, was assigned to Revenue Officer STANLEY ONG under Group Supervisor GREGORIO TUMANGUIL. Mr. Stanley Ong was the same revenue officer who conducted the review of “Dunkin’ Donuts” tax case and recommended for the issuance of the statutory notices of assessment (PAN and FANs) when he was yet with the Assessment Division of the Regional Office in Quezon City. I am not a lawyer though I believe that Revenue Officer Ong who conducted the “first re-investigation” could no longer disturb my tax assessment by himself for reasons of principle of estoppel. The equitable principle of estoppel forbids the revenue officer who conducted the “first re-investigation” from taking inconsistent position against his concurrence to my original audit findings that culminated in the deficiency tax assessment amounting to PhP 1.56-B which is already FINAL, EXECUTORY, and DEMANDABLE but which was re-investigated by no other than him. The result of the “first re-investigation” conducted by Revenue Officers Ong and Tumanguil, who were then assigned at RDO No. 41, Mandaluyong City, was a HOCUS-POCUS. The “second re-investigation”, which is also no longer necessary because my tax assessment attained finality, was referred to ATTY. GRACE CRUZ of the National Investigation Division, BIR National Office in Diliman, Quezon City. I strongly admire Atty. Cruz of her investigative expertise in administrative cases. Lest I be misconstrued. I am not saying that Atty. Cruz is short of proficiency in tax accounting and tax auditing. NO RESULT OF REINVESTIGATION WAS SUBMITTED BY ATTY. CRUZ. So, how can former BIR Chief Henares claim that her groups of revenue officers who conducted the two (2) separate re-investigations came up with the same findings that my tax assessment against the doughnut company was incorrect? --- AMAZING!!! 5. Henares’s another “PALUSOT” in not filing fraud case vs. “Dunkin’ Donuts”. Henares and her minions claimed that the compact disc (CD), which I presented to the RATE team, was allegedly not compliant with the requirements prescribed under Revenue Memorandum Order (RMO) No. 29-2002. The RATE coordinator, members, and Mr. Wilfredo Reyes, the pioneer CATTs user, failed to consider and evaluate the documents attached to the docket of “Dunkin’ Donuts” case and the findings for deficiency tax assessment which were based on entries per duly-registered books of accounts (hardbound computer-generated), as I have appropriately validated; and other independent relevant documents, such as but not limited to: Franchise Agreement, Technical Service Agreement, and other BIR returns filed by the doughnut company, such as: VAT returns and Final Withholding Tax Remittance Returns. The CD, which was neither mentioned nor objected to by “Dunkin’ Donuts” in its INVALID protest, is used by Henares and her minions as scapegoat in not filing tax evasion case against the company by claiming that said CD is not compliant with the requirements prescribed under RMO No. 29-2002 - that it should be properly labeled with the name of the taxpayer, taxable year and serial no. and volume no. and signed by the taxpayer and RDO. I pointed out that “Dunkin’ Donuts” adopts a “computer-assisted accounting system” wherein it is still required to register a “hardbound computer-generated books of accounts” which were the bases of my audit findings. Thus, the CD, which they used as scapegoat in not filing fraud case against “Dunkin’ Donuts”, need not be strictly compliant with the requirements provided under the aforesaid RMO in regards to the markings to be inscribed thereon. RMO No. 29-2002 clearly provides that in case the taxpayer has no capability to submit in CD-ROM form, procedures under the MANUAL SYSTEM shall prevail. In other words, if the taxpayer adopts a computer system of accounting but has no capability to integrate the different components of accounting system (i.e., books of accounts and other related accounting records) in a CD-ROM form, it shall still be required to register a “hardbound computer-generated books of accounts”, as in the case of “Dunkin’ Donuts”. I suggested to the RATE team that they may recommend for the issuance of a Subpoena Duces Tecum (SDT) to compel the doughnut company produce its duly-registered hardbound computer-generated books of accounts, but the suggestion was just ignored. What is crystal clear is that, Henares deliberately deceived the FILIPINO people by making excuses to conceal the REAL TRUTH about this bigtime tax evasion case. Again, as I said, the Ombudsman dismissed the case…without scrutinizing tax laws, rules and regulations. –- IT’S MORE FUN IN THE PHILIPPINES!!! www.othelloedalanon.blogspot.com Othello Dalanon

Thello Dalanon BIR KIM HENARES: BOOKS OF ACCOUNTS ARE NOT THE BASES OF TAX ASSESSMENTS. Section 232 of Republic Act No. 8424 otherwise known as the National Internal Revenue Code of 1997, as amended, in relation to Section 3 of Revenue Regulations No. V-1, the Boo Read more ... kkeeping Regulations, as amended, provides that all persons, natural or juridical, required by law to pay internal revenue tax shall keep books of accounts. The said books of accounts shall contain all information necessary for the accurate determination of the internal revenue taxes due on their businesses. Section 235 of the same Code also provides that the books of accounts shall be subject to examination and inspection by the internal revenue officers. The reason for the requirement to keep books of accounts is stated in the law (Section 232, 1997 NIRC, as amended) itself, that is, in order that all taxes due the government may readily and accurately be ascertained and determined any time of the year. In GDI (Dunkin’ Donuts) tax case, the bases of my audit findings that culminated in the tax assessment amounting to P1.56-B against the company were its BIR-registered hardbound computer-generated books of accounts. That sales reflected in the said books of accounts was significantly higher than the amount reflected in the tax return. Meaning, there was a substantial under-declaration of sales. According to the SUPREME COURT in the case of Paper Industries Corporation of the Philippines v. Court of Appeals, et al., 250 SCRA 434 – the books of accounts prevail over tax return when they reflect higher sales, because they are kept and prepared under control and supervision of the taxpayer; and they embody what must appear to be admission against interest. However, for BIR Commissioner Kim Henares, my audit findings which were based on data contained in GDI’s BIR-registered hardbound computer-generated books of accounts were flawed. So, why still keep books of accounts when they are not the bases of tax assessments? Why do BIR examiners require taxpayers who are under tax investigation to present books of accounts? Comics ba ang laman ng books of accounts, Atty. Kim Henares? THE HOCUS-POCUS. Henares, in a telecast interview by GMA-7, said that representatives of GDI complained to her that my tax assessment against the company was faulty, that is why she had it re-investigated twice, conducted by different groups of revenue officers who supposedly arrived at the same results, purportedly finding my tax assessment to be incorrect. The honorable commissioner LIED!!! Just to reiterate. The PhP 1.56 billion deficiency tax assessment against GDI obtained finality. Thus, re-investigations are no longer warranted. Once the deficiency tax assessment obtained finality, the right of the government to collect the deficiency tax becomes absolute; thus, precludes the taxpayer from questioning the correctness of the assessment and from raising any justification or defense that would pave the way for a re-investigation. There is no LAW that authorizes the Commissioner to order two (2) re-investigations of a FINAL, EXECUTORY and DEMANDABLE assessment. Notwithstanding the ensuing finality of the afore-said deficiency tax assessment against GDI, no less than the Commissioner herself allowed such re-investigations. The “first re-investigation”, which is no longer warranted because my tax assessment which remained undisturbed after review and evaluation by high-ranking officers in the district and regional levels of the Bureau and already covered by Final Assessment Notices (FANs) bearing Demand No. 41-B072-07 and all dated October 29, 2010 obtained finality, was assigned to Revenue Officer STANLEY ONG, under Group Supervisor GREGORIO S. TUMANGUIL. Mr. STANLEY ONG was the same revenue officer who conducted the review of the case and recommended for the issuance of the statutory notices of assessment (PAN and FANs) when he was yet with the Assessment Division of the Regional Office in Quezon City. I am not a lawyer though I believe that Revenue Officer STANLEY ONG who conducted the “first re-investigation” could no longer disturb my tax assessment by himself for reasons of principle of estoppel. The equitable principle of estoppel forbids the revenue officer who conducted the “first re-investigation” from taking inconsistent position against his concurrence to my original audit findings that culminated in the deficiency tax assessment amounting to P1.56 billion which is already FINAL, EXECUTORY and DEMANDABLE but which was re-investigated by no other than him. The result of the “first re-investigation” conducted by revenue officers STANLEY ONG and GREGORIO TUMANGUIL, both of BIR Revenue District Office (RDO) no. 41, Mandaluyong City, was a HOCUS-POCUS. The “second re-investigation”, which again is no longer necessary because my tax assessment obtained finality, was referred to ATTY. GRACE CRUZ of the National Investigation Division, BIR National Office in Diliman, Quezon City. I strongly admire ATTY. CRUZ of her investigative expertise in administrative cases. Lest I be misconstrued. I am not saying that ATTY. CRUZ is short of proficiency in tax accounting and tax auditing. No result of re-investigation was submitted by ATTY. CRUZ. So, how can Henares claim that her groups of revenue officers who conducted the two (2) separate re-investigations came up with the same findings that my tax assessment against GDI was incorrect? What is crystal clear is that, Henares deliberately deceived the FILIPINO people by making excuses to conceal the real truth about this bigtime tax evasion case. ON ANOTHER NOTE. Henares and her minions claimed that the compact disc (CD), which I presented to the RATE “Run after Tax Evaders” team, was allegedly not compliant with the requirements prescribed under Revenue Memorandum Order (RMO) No. 29-2002. The RATE coordinator, members, and Mr. Wilfredo Reyes, the pioneer CAATTs (Computer-Assisted Audit Tools and Techniques) user, failed to consider and evaluate the documents attached to the docket of GDI case and the findings for deficiency tax assessment which were based on entries per duly-registered books of accounts (hardbound computer-generated), as I have appropriately validated; and other independent relevant documents, such as but not limited to, Franchise Agreement; Technical Service Agreement, and other BIR returns filed by GDI, such as: VAT returns and Final Withholding Tax Remittance Returns. The CD, which was neither mentioned nor objected to by GDI in its INVALID protest, is used by Henares and her minions as scapegoat in not filing tax evasion case against GDI by claiming that said CD is not compliant with the requirements prescribed under RMO No. 29-2002 - that it should be properly labeled with the name of the taxpayer, taxable year and serial no. and volume no. and signed by the taxpayer and RDO. I pointed out that GDI adopts a “computer-assisted accounting system” wherein it is still required to register a “hardbound computer-generated books of accounts” which were the bases of my audit findings. Thus, the CD, which they used as scapegoat in not filing fraud case against GDI, need not be strictly compliant with the requirements provided under the aforesaid RMO in regards to the markings to be inscribed thereon. RMO No. 29-2002 clearly provides that in case the taxpayer has no capability to submit in CD-ROM form, procedures under the MANUAL SYSTEM shall prevail. In other words, if the taxpayer adopts a computer system of accounting but has no capability to integrate the different components of accounting system (i.e., books of accounts and other related accounting records) in a CD-ROM form, it shall still be required to register a “hardbound computer-generated books of accounts”, as in the case of GDI. I suggested to the RATE team that they may recommend for the issuance of a Subpoena Duces Tecum (SDT) to compel GDI produce its duly-registered hardbound computer-generated books of accounts, but the suggestion was just ignored. ATTY. HENARES, JUST SPEAK THE WHOLE TRUTH AND NOTHING BUT THE TRUTH!!! www.othelloedalanon.blogspot.com Othello Dalanon Philippine Daily Inquirer Chairperson Marixi R. Prieto firm Golden Donuts, Inc. (GDI) is the exclusive Philippine Franchisee of the American food brand “Dunkin’ Donuts”. #KimHenares #BIR #Commissioner #EstelaSales #NestorValeroso #IsabelPaulino #GregorioTumanguil #StanleyOng #MarixiPrieto #PhilippineDailyInquirer #GoldenDonuts #DunkinDonuts #DunkinBrands #eFPS #EVAT #IncomeTax #TaxWhiz #TaxCode #Taxes #SALN #SupremeCourt #RMO #RMC #RR

Thello Dalanon BIR’s HENARES, HINOKUSPOKUS ANG P1.56-B TAX DEFICIT NG “DUNKIN’ DONUTS”. Kim Henares, in a telecast interview by GMA-7, said that representatives of Philippine Daily Inquirer chair Marixi R. Prieto firm Golden Donuts, Inc. (GDI), the exclusi Read more ... ve Philippine Franchisee of the global brand “Dunkin’ Donuts”, complained to her that my tax assessment against the company was faulty, that is why she had it re-investigated twice, conducted by different groups of revenue officers who supposedly arrived at the same results, purportedly finding my tax assessment to be incorrect. SHE LIED!!! Just to reiterate. The PhP 1.56 billion deficiency tax assessment against GDI obtained finality. Thus, re-investigations are no longer warranted. Once the deficiency tax assessment obtained finality, the right of the government to collect the deficiency tax becomes absolute; thus, precludes the taxpayer from questioning the correctness of the assessment and from raising any justification or defense that would pave the way for a re-investigation. There is no LAW that authorizes the Commissioner to order two (2) re-investigations of a FINAL, EXECUTORY and DEMANDABLE assessment. Notwithstanding the ensuing finality of the afore-said deficiency tax assessment against GDI, no less than the Commissioner herself allowed such re-investigations. The “first re-investigation”, which is no longer warranted because my tax assessment which remained undisturbed after review and evaluation by high-ranking officers in the district and regional levels of the Bureau and already covered by Final Assessment Notices (FANs) bearing Demand No. 41-B072-07 and all dated October 29, 2010 obtained finality, was assigned to Revenue Officer STANLEY ONG, under Group Supervisor GREGORIO S. TUMANGUIL. Mr. STANLEY ONG was the same revenue officer who conducted the review of the case and recommended for the issuance of the statutory notices of assessment (PAN and FANs) when he was yet with the Assessment Division of the Regional Office in Quezon City. I am not a lawyer though I believe that Revenue Officer STANLEY ONG who conducted the “first re-investigation” could no longer disturb my tax assessment by himself for reasons of principle of estoppel. The equitable principle of estoppel forbids the revenue officer who conducted the “first re-investigation” from taking inconsistent position against his concurrence to my original audit findings that culminated in the deficiency tax assessment amounting to P1.56 billion which is already FINAL, EXECUTORY and DEMANDABLE but which was re-investigated by no other than him. The result of the “first re-investigation” conducted by revenue officers STANLEY ONG and GREGORIO TUMANGUIL, both of BIR Revenue District Office (RDO) no. 41, Mandaluyong City, was a HOCUS-POCUS. The “second re-investigation”, which again is no longer necessary because my tax assessment obtained finality, was referred to ATTY. GRACE CRUZ of the National Investigation Division, BIR National Office in Diliman, Quezon City. I strongly admire ATTY. CRUZ of her investigative expertise in administrative cases. Lest I be misconstrued. I am not saying that ATTY. CRUZ is short of proficiency in tax accounting and tax auditing. No result of re-investigation was submitted by ATTY. CRUZ. So, how can Henares claim that her groups of revenue officers who conducted the two (2) separate re-investigations came up with the same findings that my tax assessment against GDI was incorrect? What is crystal clear is that, Henares deliberately deceived the FILIPINO people by making excuses to conceal the real truth about this bigtime tax evasion case. Atty. Henares, just speak the whole truth and nothing but the truth!!! www.othelloedalanon.blogspot.com Othello Dalanon #KimHenares #BIR #Commissioner #RFP #eFPS #IncomeTax #VAT #EstelaSales #NestorValeroso #IsabelPaulino #OliviaAmanse #GregorioTumanguil #StanleyOng #MarixiPrieto #PhilippineDailyInquirer #GoldenDonuts #DunkinDonuts #DunkinBrands #TaxReform #TaxWatch #TaxWhiz #CorruptOfficials #Taxes #PhilippineGovernment #TaxAudit #DaangMatuwid #SALN #Ombudsman #TaxLawyer #Justices

Thello Dalanon “HENARES ON LOWER TAX CALLS: GOOD FOR ME BUT NOT FOR PH” [ABS-CBNnews.com] BUT WHAT ABOUT HER INTENTIONAL FAILURE TO COLLECT GDI’s P1.56-B UNPAID TAX DEFICIT? GOOD FOR HER AND HER MINIONS, NOT FOR PH INDEED! The formal complaint I filed with Read more ... the Office of the Ombudsman vs Kim Henares and Estela Sales in connection with the P1.56-B tax case involving Golden Donuts, Inc. (GDI) includes, among other issues, the following: 1. That GDI’s duly-registered books of accounts reflected a Net Income of P135.2-M while the tax return reflected a Net Loss of P44.9-M. 2. That GDI’s duly-registered books of accounts reflected higher sales than that reflected on the tax return. Sales per duly-registered books was P1.928-B while per tax return was P1.031-B. A huge discrepancy (under-declaration) amounting to P897-M. The SUPREME COURT ruled in the case of Paper Industries Corporation of the Philippines versus Court of Appeals, et al., 250 SCRA 434 that “where the books of accounts reflected a Sales or Receipts higher than that reflected in the return, the books of accounts should prevail. This is so, because the books of accounts are kept by the taxpayer and are prepared under its control and supervision; and they reflected what may be deemed to be admission against interest.” 3. Other independent relevant documents further revealed that GDI’s sales topped P2.366-B but the amount recorded in the duly-registered books was P1.928-B. A huge discrepancy amounting to P438-M. Henares and Sales, in their counter-affidavits, and even the supporting affidavits of Atty. Romel Curiba, RATE Team Leader, and Mr. Wilfredo Reyes, the pioneer BIR CAATTs user, did not state any justifications or explanations to refute the above-enumerated issues. The Ombudsman dismissed the case without investigating these issues scrupulously, and without discussing the same in the dismissal resolution despite glaring discrepancies. The Ombudsman also did not secure GDI tax case docket from the BIR which is very crucial in the investigation. No hearing was conducted. THE HOCUS-POCUS Henares, in a telecast interview by GMA-7, said that representatives of GDI complained to her that my tax assessment against the company was faulty, that is why she had it re-investigated twice, conducted by different groups of revenue officers who supposedly arrived at the same results, purportedly finding my tax assessment to be incorrect. SHE LIED!!! Just to reiterate. The PhP 1.56 billion deficiency tax assessment against GDI obtained finality. Thus, re-investigations are no longer warranted. Once the deficiency tax assessment obtained finality, the right of the government to collect the deficiency tax becomes absolute; thus, precludes the taxpayer from questioning the correctness of the assessment and from raising any justification or defense that would pave the way for a re-investigation. There is no LAW that authorizes the Commissioner to order two (2) re-investigations of a FINAL, EXECUTORY and DEMANDABLE assessment. Notwithstanding the ensuing finality of the afore-said deficiency tax assessment against GDI, no less than the Commissioner herself allowed such re-investigations. The “first re-investigation”, which is no longer warranted because my tax assessment which remained undisturbed after review and evaluation by high-ranking officers in the district and regional levels of the Bureau and already covered by Final Assessment Notices (FANs) bearing Demand No. 41-B072-07 and all dated October 29, 2010 obtained finality, was assigned to Revenue Officer STANLEY ONG, under Group Supervisor GREGORIO S. TUMANGUIL. Mr. STANLEY ONG was the same revenue officer who conducted the review of the case and recommended for the issuance of the statutory notices of assessment (PAN and FANs) when he was yet with the Assessment Division of the Regional Office in Quezon City. I am not a lawyer though I believe that Revenue Officer STANLEY ONG who conducted the “first re-investigation” could no longer disturb my tax assessment by himself for reasons of principle of estoppel. The equitable principle of estoppel forbids the revenue officer who conducted the “first re-investigation” from taking inconsistent position against his concurrence to my original audit findings that culminated in the deficiency tax assessment amounting to P1.56 billion which is already FINAL, EXECUTORY and DEMANDABLE but which was re-investigated by no other than him. The result of the “first re-investigation” conducted by revenue officers STANLEY ONG and GREGORIO TUMANGUIL, both of BIR Revenue District Office (RDO) no. 41, Mandaluyong City, was a HOCUS-POCUS. The “second re-investigation”, which again is no longer necessary because my tax assessment obtained finality, was referred to ATTY. GRACE CRUZ of the National Investigation Division, BIR National Office in Diliman, Quezon City. I strongly admire ATTY. CRUZ of her investigative expertise in administrative cases. Lest I be misconstrued. I am not saying that ATTY. CRUZ is short of proficiency in tax accounting and tax auditing. No result of re-investigation was submitted by ATTY. CRUZ. So, how can Henares claim that her groups of revenue officers who conducted the two (2) separate re-investigations came up with the same findings that my tax assessment against GDI was incorrect? What is crystal clear is that, Henares deliberately deceived the FILIPINO people by making excuses to conceal the real truth about this bigtime tax evasion case. ON ANOTHER NOTE. Henares and her minions claimed that the compact disc (CD), which I presented to the RATE “Run after Tax Evaders” team, was allegedly not compliant with the requirements prescribed under Revenue Memorandum Order (RMO) No. 29-2002. The RATE coordinator, members, and Mr. Wilfredo Reyes, the pioneer CAATTs (Computer-Assisted Audit Tools and Techniques) user, failed to consider and evaluate the documents attached to the docket of GDI case and the findings for deficiency tax assessment which were based on entries per duly-registered books of accounts (hardbound computer-generated), as I have appropriately validated; and other independent relevant documents, such as but not limited to, Franchise Agreement; Technical Service Agreement, and other BIR returns filed by GDI, such as: VAT returns and Final Withholding Tax Remittance Returns. The CD, which was neither mentioned nor objected to by GDI in its INVALID protest, is used by Henares and her minions as scapegoat in not filing tax evasion case against GDI by claiming that said CD is not compliant with the requirements prescribed under RMO No. 29-2002 - that it should be properly labeled with the name of the taxpayer, taxable year and serial no. and volume no. and signed by the taxpayer and RDO. I pointed out that GDI adopts a “computer-assisted accounting system” wherein it is still required to register a “hardbound computer-generated books of accounts” which were the bases of my audit findings. Thus, the CD, which they used as scapegoat in not filing fraud case against GDI, need not be strictly compliant with the requirements provided under the aforesaid RMO in regards to the markings to be inscribed thereon. RMO No. 29-2002 clearly provides that in case the taxpayer has no capability to submit in CD-ROM form, procedures under the MANUAL SYSTEM shall prevail. In other words, if the taxpayer adopts a computer system of accounting but has no capability to integrate the different components of accounting system (i.e., books of accounts and other related accounting records) in a CD-ROM form, it shall still be required to register a “hardbound computer-generated books of accounts”, as in the case of GDI. I suggested to the RATE team that they may recommend for the issuance of a Subpoena Duces Tecum (SDT) to compel GDI produce its duly-registered hardbound computer-generated books of accounts, but the suggestion was just ignored. ATTY. HENARES, JUST SPEAK THE WHOLE TRUTH AND NOTHING BUT THE TRUTH!!! www.othelloedalanon.blogspot.com Othello Dalanon #KimHenares #BIR #Commissioner #RFP #eFPS #IncomeTax #VAT #EstelaSales #NestorValeroso #IsabelPaulino #OliviaAmanse #GregorioTumanguil #StanleyOng #MarixiPrieto #PhilippineDailyInquirer #GoldenDonuts #DunkinDonuts #DunkinBrands #TaxReform #TaxCut #TaxWhiz #Taxation #Government #Filipino #Citizen #Philippines #Taxes #TaxExperts

Thello Dalanon [Permission to post] DOES PHILIPPINES's INTERNAL REVENUE CHIEF HENARES COLLECT THE CORRECT TAXES? The formal complaint I filed with the Office of the Ombudsman vs Kim Henares and Estela Sales in connection with the P1.56-B tax case involving Golden Read more ... Donuts, Inc. (GDI) includes, among other issues, the following: 1. That GDI’s duly-registered books of accounts reflected a Net Income of P135.2-M while the tax return reflected a Net Loss of P44.9-M. 2. That GDI’s duly-registered books of accounts reflected higher sales than that reflected on the tax return. Sales per duly-registered books was P1.928-B while per tax return was P1.031-B. A huge discrepancy (under-declaration) amounting to P897-M. The SUPREME COURT ruled in the case of Paper Industries Corporation of the Philippines versus Court of Appeals, et al., 250 SCRA 434 that “where the books of accounts reflected a Sales or Receipts higher than that reflected in the return, the books of accounts should prevail. This is so, because the books of accounts are kept by the taxpayer and are prepared under its control and supervision; and they reflected what may be deemed to be admission against interest.” 3. Other independent relevant documents further revealed that GDI’s sales topped P2.366-B but the amount recorded in the duly-registered books was P1.928-B. A huge discrepancy amounting to P438-M. Henares and Sales, in their counter-affidavits, and even the supporting affidavits of Atty. Romel Curiba, RATE Team Leader, and Mr. Wilfredo Reyes, the pioneer BIR CAATTs user, did not state any justifications or explanations to refute the above-enumerated issues. The Ombudsman dismissed the case without investigating these issues scrupulously, and without discussing the same in the dismissal resolution despite glaring discrepancies. The Ombudsman also did not secure GDI tax case docket from the BIR which is very crucial in the investigation. No hearing was conducted. THE HOCUS-POCUS Henares, in a telecast interview by GMA-7, said that representatives of GDI complained to her that my tax assessment against the company was faulty, that is why she had it re-investigated twice, conducted by different groups of revenue officers who supposedly arrived at the same results, purportedly finding my tax assessment to be incorrect. SHE LIED!!! Just to reiterate. The PhP 1.56 billion deficiency tax assessment against GDI obtained finality. Thus, re-investigations are no longer warranted. Once the deficiency tax assessment obtained finality, the right of the government to collect the deficiency tax becomes absolute; thus, precludes the taxpayer from questioning the correctness of the assessment and from raising any justification or defense that would pave the way for a re-investigation. There is no LAW that authorizes the Commissioner to order two (2) re-investigations of a FINAL, EXECUTORY and DEMANDABLE assessment. Notwithstanding the ensuing finality of the afore-said deficiency tax assessment against GDI, no less than the Commissioner herself allowed such re-investigations. The “first re-investigation”, which is no longer warranted because my tax assessment which remained undisturbed after review and evaluation by high-ranking officers in the district and regional levels of the Bureau and already covered by Final Assessment Notices (FANs) bearing Demand No. 41-B072-07 and all dated October 29, 2010 obtained finality, was assigned to Revenue Officer STANLEY ONG, under Group Supervisor GREGORIO S. TUMANGUIL. Mr. STANLEY ONG was the same revenue officer who conducted the review of the case and recommended for the issuance of the statutory notices of assessment (PAN and FANs) when he was yet with the Assessment Division of the Regional Office in Quezon City. I am not a lawyer though I believe that Revenue Officer STANLEY ONG who conducted the “first re-investigation” could no longer disturb my tax assessment by himself for reasons of principle of estoppel. The equitable principle of estoppel forbids the revenue officer who conducted the “first re-investigation” from taking inconsistent position against his concurrence to my original audit findings that culminated in the deficiency tax assessment amounting to P1.56 billion which is already FINAL, EXECUTORY and DEMANDABLE but which was re-investigated by no other than him. The result of the “first re-investigation” conducted by revenue officers STANLEY ONG and GREGORIO TUMANGUIL, both of BIR Revenue District Office (RDO) no. 41, Mandaluyong City, was a HOCUS-POCUS. The “second re-investigation”, which again is no longer necessary because my tax assessment obtained finality, was referred to ATTY. GRACE CRUZ of the National Investigation Division, BIR National Office in Diliman, Quezon City. I strongly admire ATTY. CRUZ of her investigative expertise in administrative cases. Lest I be misconstrued. I am not saying that ATTY. CRUZ is short of proficiency in tax accounting and tax auditing. No result of re-investigation was submitted by ATTY. CRUZ. So, how can Henares claim that her groups of revenue officers who conducted the two (2) separate re-investigations came up with the same findings that my tax assessment against GDI was incorrect? What is crystal clear is that, Henares deliberately deceived the FILIPINO people by making excuses to conceal the real truth about this bigtime tax evasion case. ON ANOTHER NOTE. Henares and her minions claimed that the compact disc (CD), which I presented to the RATE “Run after Tax Evaders” team, was allegedly not compliant with the requirements prescribed under Revenue Memorandum Order (RMO) No. 29-2002. The RATE coordinator, members, and Mr. Wilfredo Reyes, the pioneer CAATTs (Computer-Assisted Audit Tools and Techniques) user, failed to consider and evaluate the documents attached to the docket of GDI case and the findings for deficiency tax assessment which were based on entries per duly-registered books of accounts (hardbound computer-generated), as I have appropriately validated; and other independent relevant documents, such as but not limited to, Franchise Agreement; Technical Service Agreement, and other BIR returns filed by GDI, such as: VAT returns and Final Withholding Tax Remittance Returns. The CD, which was neither mentioned nor objected to by GDI in its INVALID protest, is used by Henares and her minions as scapegoat in not filing tax evasion case against GDI by claiming that said CD is not compliant with the requirements prescribed under RMO No. 29-2002 - that it should be properly labeled with the name of the taxpayer, taxable year and serial no. and volume no. and signed by the taxpayer and RDO. I pointed out that GDI adopts a “computer-assisted accounting system” wherein it is still required to register a “hardbound computer-generated books of accounts” which were the bases of my audit findings. Thus, the CD, which they used as scapegoat in not filing fraud case against GDI, need not be strictly compliant with the requirements provided under the aforesaid RMO in regards to the markings to be inscribed thereon. RMO No. 29-2002 clearly provides that in case the taxpayer has no capability to submit in CD-ROM form, procedures under the MANUAL SYSTEM shall prevail. In other words, if the taxpayer adopts a computer system of accounting but has no capability to integrate the different components of accounting system (i.e., books of accounts and other related accounting records) in a CD-ROM form, it shall still be required to register a “hardbound computer-generated books of accounts”, as in the case of GDI. I suggested to the RATE team that they may recommend for the issuance of a Subpoena Duces Tecum (SDT) to compel GDI produce its duly-registered hardbound computer-generated books of accounts, but the suggestion was just ignored. ATTY. HENARES, JUST SPEAK THE WHOLE TRUTH AND NOTHING BUT THE TRUTH!!! www.othelloedalanon.blogspot.com Othello Dalanon