019. People v. Tan Boon Kong

[019] PEOPLE

OF THE

PHILIPPINE ISLANDS,

PLAINTIFF-APPELLANT

V.

TAN BOON KONG,

DEFENDANT-APPELLEE

GR NO L-35262 MARCH 15, 1930 OSTRAND, J. SV: Tan Boon Kong, manager of a corporation engaged in buying and selling copra, sugar and other goods was charged in an information for violation of a law requiring the making of true returns of receipts and sales. The demurrer to the info was sustained on the ground that the offense was committed by the corporation and not by the officials or agents SC: a corporation can only act through its officers and agents, in this case, the false return was caused by the manager and he should bear its consequences.

1. An information was filed against Tan Boon Kong charging him with the violation of sec. 14581 of Act 2711 as amended. 2. According to the information the Tan “as corporation” organized under the laws of the Philippine islands and engaged in the purchase and sale of sugar, “bayon”, copra and other native products and should be subject to pay internal-revenue taxes. 3. Allegedly he only declared in 1924 for the purpose of taxation the sum of P2,352,761.94 when in fact he knew that the total gross sales of the said corporation amounted to P2,543,303.44 (difference P190,541.50, which he failed to declare) 4. Judge of the 23rd judicial district sustained the demurrer to the information charging Tan with the said violation. Hence this appeal

1

SEC. 1458. Payment of percentage taxes — Quarterly reports of earnings. — The percentage taxes on business shall be payable at the end of each calendar quarter in the amount lawfully due on the business transacted during each quarter; and it shall be on the duty of every person conducting a business subject to such tax, within the same period as is allowed for the payment of the quarterly installments of the fixed taxes without penalty, to make a true and complete return of the amount of the receipts or earnings of his business during the preceeding quarter and pay the tax due thereon. . . . (Act No. 2711.)

ISSUE: should Tan as manager of the corporation be liable criminally under the sec. 2723 2 of act no. 2711 for violation of sec 1458 of the same act for the benefit of the said corporation? YES •

the court below based the ruling on the ground that the offense charged must be regarded as committed by the corporation and not by its officials or agents.

•

But a corporation can act only through its officers and agents and where the business itself involves a violation of the law, the rule is that all who participate in it are liable

•

State v. Burnam: the manager of a corporation was criminally liable for the violation of a statute by the corporation though he was not present when it was committed

•

In the present case, the info alleges that Tan was the manager of the corporation, he made a false return for the purposes of taxation, and such false return constitutes a violation of law. Tan, as the author of the illegal act, must answer for its consequences if the allegations are proven.

Ruling appealed from REVERSED. Case remanded for further proceedings not inconsistent with the SC ruling.

2

SEC. 2723. Failure to make true return of receipts and sales. — Any person who, being required by law to make a return of the amount of his receipts, sales, or business, shall fail or neglect to make such return within the time required, shall be punished by a fine not exceeding two thousand pesos or by imprisonment for a term not exceeding one year, or both. And any such person who shall make a false or fraudulent return shall be punished by a fine not exceeding ten thousand pesos or by imprisonment for a term not exceeding two years, or both. (Act No. 2711.)