The Bureau of Internal Revenue (BIR) has won a major legal victory against tax fraud. Officers of a so-called “ghost corporation” have been found guilty of criminal tax violations. The case involved Decarich Supertrade, Inc., a company that never truly operated. The Quezon City Regional Trial Court (RTC), Branch 100, handed down the decision on January 21, 2026.

Fernando Bitoon Lawas, also known as Fernando Bitongon Lawas, was the president of the company. Adeline Manngas y Cañas, also called Adeline Manggas y Cañas, served as treasurer. Both were convicted beyond reasonable doubt. They broke tax laws under the National Internal Revenue Code of 1997, as amended.

The court focused on false information in the company’s Value-Added Tax (VAT) return. The report was for the first quarter of 2021. The two officers failed to give correct and accurate data. This is a violation of Section 255 of the Tax Code. The judge sentenced them to up to three years in prison. They must also pay a total fine of Php120,000.00.

Decarich Supertrade, Inc. was registered with the Securities and Exchange Commission (SEC). It was also listed with the BIR. That means it had legal duties, including filing tax returns. But investigators could not find the company at its registered address. They acted under a valid Letter of Authority and Mission Order.

Barangay officials and the building administrator confirmed the truth. No such business existed at the stated location. There was no office. There were no employees. There was no daily operation. The address was fake.

The court said this alone is a crime. Giving a false address to the BIR violates tax laws. A real business needs a real place to operate. Without one, no legal transactions can happen. The company only existed on paper.

Records made it seem like Decarich was active. But when tested, the proof fell apart. The court found more lies. The officers tried to show business activity. But their documents showed mismatches. The data did not add up.

Prosecutors showed the scheme used fake receipts. These are also called “ghost receipts.” They made it look like Decarich had millions in sales. But none of the sales were real. The transactions never happened.

The goal was clear. Create the illusion of sales. Help clients hide their own fake deals. Reduce tax payments owed to the government. This is tax evasion. It hurts public funds. It breaks trust in the tax system.

The court noted “patent inconsistencies” in the records. These gaps proved intent. The officers acted on purpose. They wanted to cheat the system. Their actions harmed the government’s right to collect proper taxes.

The BIR said this case is a warning. Ghost corporations will not be tolerated. The agency is cracking down on fake businesses. These companies exist only to commit fraud. They file false returns. They issue fake receipts. They cost the Philippines millions in lost revenue.

This conviction shows the BIR’s push for accountability. It proves that tax cheats can be caught. Legal action follows. Officers face jail time. They also face heavy fines.

Tax fraud hurts all Filipinos. It reduces funds for schools, hospitals, roads, and safety. The BIR urges the public to report suspicious businesses. Anyone with info can contact the agency.

The fight against ghost corporations continues. The BIR works with other agencies. They use audits, data checks, and field visits. Their goal is a fair and honest tax system for everyone.

This win in Quezon City sets a strong example. It shows that the law applies to all. No one is above it. The BIR remains committed to stopping tax fraud in the Philippines.