The Bureau of Internal Revenue (BIR) today filed a criminal complaint with the Department of Justice against MARY ANNE A. ABAD (MARY ANNE) for one (1) count of willful attempt to evade or defeat the payment of Estate Tax and for one (1) count of deliberate failure to file the Estate Tax Return of the Estate of Martiniano G. Abad, in violation of Sections 254 and 255 of the National Internal Revenue Code of 1997, as amended (Tax Code).

Likewise charged was ATTY. ANTOLIN V. OLIVA (ATTY. OLIVA) for for one (1) count of willful attempt to evade or defeat the payment of Estate Tax of the Estate of Martiniano G. Abad, in violation of Section 254 in relation to Section 253 (b) of the Tax Code.

MARY ANNE is a resident of #63 Gilmore Street, New Manila, Quezon City while ATTY. OLIVA holds office at M/F Diamond Theater Bldg., Mary Street cor. Aurora Boulevard, Cubao, Quezon City.

The investigation of the Estate of Martiniano G. Abad was prompted by a denunciation letter received by the Office of the Regional Director on February 10, 2010 with the information that a certain Martiniano G. Abad died on December 21, 2008 without a will and left several residential and commercial real properties with improvements.

Investigation showed that Remedios, wife of Martiniano, died in 1986 without any estate tax return being filed by the legal heirs Martiniano and Myrna Abad. Nevertheless, Martiniano settled the Estate of Remedios in 1997 under the Voluntary Assessment Program (VAP) of the BIR.

Despite the death of Remedios in 1986, five (5) Special Powers of Attorney (SPAs) were executed on June 2006 appointing MARY ANNE as Attorney-in-Fact of Spouses Martiniano and Remedios to exercise control and supervision over all the spouses’ properties located in Manila, Quezon City, Makati, Nueva Ecija and Laguna valued at P382.67 million. ATTY. OLIVA notarized the said SPAs wherein he acknowledged the execution of the documents by, among others, Remedios who was already dead at that time. ATTY. OLIVA was not a commissioned Notary Public in 2006.

Martiniano died in December 2008 without any estate tax return being filed by Myrna, the sole legal heir of both spouses. On October 2009, notwithstanding the death of Spouses Martiniano and Remedios, MARY ANNE executed five (5) Deeds of Assignment conveying their properties in favor of Abad Royale Estate, Inc. (AREI) as payment for the subscription of stocks of the latter. The said conveyance was exempted from the payment of the corresponding taxes by BIR Certification Ruling SN No. 391-2009 dated December 29, 2009. AREI was incorporated in 2010 with the properties so conveyed forming part of the total assets of the corporation.

With both majority shareholders Martiniano and Remedios dead, MARY ANNE had the controlling shares and exercised effective “owner-like” rights over the real properties of AREI. On June 2011, Myrna Abad died intestate. On July 10, 2013, the BIR revoked the Certification Ruling issued to AREI in view of factual misrepresentation made in the application for exemption, in particular, at the time of the execution of the Deeds of Assignment, Spouse Martiniano and Remedios were already dead making the transfers invalid.

Since no estate tax returns were filed by MARY ANNE for Martiniano and Myrna and with her collective series of acts of executing the SPAs when one of the principal, Remedios, was already dead, the transfer of the properties of Martiniano and Remedios Abad to AREI by virtue of the Deeds of Assignment, and the subsequent incorporation of AREI, MARY ANNE is liable for the payment of estate tax since she is the person in actual and constructive possession of the properties of the decedent.

MARY ANNE was sued for the payment of the estate tax on the Estate of Martiniano G. Abad amounting to P129.70 million, inclusive of surcharges and interests, and ATTY. OLIVA for willfully aiding or abetting in the commission of the crime of attempting to evade or defeat payment of estate tax.

The case against MARY ANNE A. ABAD and ATTY. ANTOLIN V. OLIVA is the 175th filed under the Run After Tax Evaders (RATE) program of the BIR under the leadership of Commissioner Kim S. Jacinto-Henares. It is likewise a RATE case of Revenue Region No. 7, Quezon City. (reytdlc)