Requesting Entity: Center for Health Development (CHD) - CALABARZON
Issues Concern: Tax Evasion
Whether the Bids and Awards Committee (BAC) of CHD may suspend an on-going infrastructure project for a period of one (1) month due to the tax evasion case filed by Bureau of Internal Revenue (BIR) against DQT Builders Corporation.
[B]ased on the existing rules on the Contract Implementation Guidelines for the Procurement of Infrastructure Projects , the procuring entity shall have the authority to suspend the work wholly or partly by written order for such period when:
a) Due to force majeure or any fortuitous events;
b) Failure on the part of the contractor to correct bad conditions which are unsafe for workers or for the general public;
c) To carry out valid orders given by the procuring entity or to perform any provisions of the contract; or
d) Due to adjustment of plans to suit field conditions as found necessary during construction.
[T]he filing of tax evasion case against the contractor is not one of the situations mentioned that will merit the suspension of the work either wholly or partially. Also, the action of the procuring entity to suspend the work may be considered premature since the tax evasion case is not tantamount to tax liability in view of the fact that the BIR has yet to determine with finality the liability of the winning contractor apart from any judicial relief or intervention that the contractor may opt to adopt.