SAN JUAN, Puerto Rico, Oct 10 (Reuters) - A Puerto Rico judge ruled in favor of Doral Financial Corp. late on Friday in its $229 million tax dispute with the Puerto Rico Treasury Department.
"The court finds that the State failed to prove that relevant facts were falsified," Puerto Rico Superior Court Judge Laureana Perez said in her 48-page ruling.
Last May, the Treasury Department voided a 2012 agreement that set a $229 million tax refund for Doral resulting from a restatement of inflated earnings during a six-year period from 1998 to 2004. Doral asked for the payment after U.S. regulators said earlier this year it could no longer include the money as cash on its balance sheet.
Treasury Secretary Melba Acosta said the agency voided the deal because it was never recognized in government accounting books and because the statute of limitations had run out on the refund. Officials also cited discrepancies in Doral financial documents and said the agreement was reached through fraud. (Reporting by Reuters in San Juan; Editing by Chris Reese)