The children of businesswoman Janet Napoles were acquitted by the Court of Tax Appeals (CTA) en banc of a criminal complaint for tax evasion filed by the Bureau of Internal Revenue (BIR).
The CTA en banc, in a seven-page decision issued on 8 June 2026 through Associate Justice Marian Ivy F. Reyes-Fajardo, affirmed the resolutions issued by the CTA Second Division, which junked the tax case against James Christopher Napoles and Jo Christine Napoles, president and treasurer of JCLN Global Properties Development Corp., on the ground of prescription.
The case stemmed from the BIR’s complaint for willful failure to supply correct and accurate information in the respondents’ 2010 income tax return.
The respondents were alleged to have fraudulently stated in their income tax return the amount of P1,742,073 only as their gross revenues for 2010, although the company’s income reached P44,192,418, which was used to acquire real properties for the same year.
The BIR accused them of deliberately concealing the existence of the acquired properties, resulting in an under-declaration of their true and correct income by P36.06 million and a failure to pay the correct tax amounting to P13.25 million, exclusive of interest and penalty charges.
BIR issued challenge
The CTA’s Second Division dismissed the complaint on the ground of prescription in a resolution issued on 20 August 2024.
The BIR in its petition for review filed before the CTA en banc, argued that prescription has not set in because under Section 281 of the National Internal Revenue Code of 1997, the discovery of the violation and the institution of proceedings operate concurrently to comment and interrupt the prescriptive period, and that the filing of criminal complaint with the prosecutor’s office for purpose of preliminary investigation interrupts or suspends the running of prescription.
But the respondents insisted that the prescriptive period commenced on 17 September 2015, upon the filing by the BIR of the criminal complaint before the DoJ; such filing did not interrupt the running of prescription, which continued uninterrupted until it lapsed on 17 September 2020; and consequently, when the information was filed before the CTA on 19 July 2024, the criminal action was already barred by prescription.