OSG asks CA to reinstate case vs Tan

The Office of the Solicitor General (OSG) asked the Court of Appeals yesterday to reinstate in the Marikina City Metropolitan Trial Court (MTC) the P25.2-billion tax evasion case the government had filed against beer and tobacco magnate Lucio Tan.

In a 40-page memorandum, government lawyers said the nine counts of tax evasion against Fortune Tobacco Corp. should push through in the sala of Marikina Judge Alex Ruiz even if the Bureau of Internal Revenue claimed it will no longer testify against the taipan.

Solicitor General Ricardo Galvez maintained that the BIR's withdrawal does not necessarily mean the tax fraud charges will not prosper and that the Department of Justice (DOJ) no longer needs the prior written approval of the BIR commissioner whenever it files cases in court.

"The chief state prosecutor, not the BIR commissioner, approved the filing of the same (charges). It will be absurd and irregular to insist that the state prosecutors of the DOJ shall be subject to the control of the BIR commissioner in the performance of their duties," he said.

Besides, Section 220 of the Tax Reform Act of 1997 which requires the BIR chief's go-signal, is not aimed at giving the government official the "whimsical authority to stop the filing of cases in court after taxing the government prosecutors with the burden of conducting the preliminary investigation."

"The BIR, on its own, cannot withdraw the criminal complaints without the prior approval and conformity of the public prosecutors. Granting that the BIR did not want to pursue the cases, it should have executed an affidavit of desistance with the conformity of the DOJ trial panel," the OSG stated.

It added: "Well-settled is the rule of criminal procedure that once criminal cases are filed in court, the conduct of the criminal proceedings are subject to the complete control and supervision of the public prosecutors and the complainants thereto are reduced to mere witnesses for the State."

Ruiz dismissed the tax fraud suit on March 1999. The case was elevated for appeal by the DOJ to the sala of RTC Judge Olga Palanca-Enriquez but was also dismissed on a technicality after the prosecutors filed the appeal 11 days late.

The suit was initially filed in September 1993 by then BIR Commissioner Liwayway Vinzons-Chato, but Tan's lawyer, former Solicitor General Estelito Mendoza, was able to hold the investigation until 1997 when the Supreme Court finally allowed the probe to continue.

After the DOJ five-member panel, headed by Senior State Prosecutor Paulita Acosta-Villarante, finished the preliminary investigation in September 1999, the charges were filed two months later by former Justice Secretary Serafin Cuevas, who referred the matter to the OSG later.