BIR Ruling [DA-043-01]

March 21, 2001 BIR RULING [DA-043-01] 236 (J); 232 (A); 133-99 National Panasonic Sales Phils . Ortigas Avenue Taytay, Rizal Attention: Ms . Elizabeth Gildore Finance Manager and Mr . Hirokazu Umeda Finance Adviser Gentlemen : This refers to your letter dated October 18, 2000 stating that on October 12, 2000 you filed with the Department of Trade and Industry, Region IV, an application for registration of new business name for your financial Sales Division, to wit: "PANASONIC INDUSTRIAL SALES PHILIPPINES (DIVISION OF MATSUSHITA ELECTRIC PHILIPPINES CORPORATION)" that is was approved on the basis that the business name is reflective of the nature of your business; that your manufacturing division uses your corporate name and only one corporate name MATSUSHITA ELECTRIC PHILIPPINES CORPORATION as this is where your factory and head office is located; that at present, your sales and marketing division has its own approved trade name "NATIONAL PANASONIC SALES PHILIPPINES"; and that in connection therewith, you now request for a ruling on the following issues: "1. Now that your Industrial Sales Division has its own business name and is reflective of the business engaged in is there a need for us to secure a new TIN Number for the new business name PANASONIC INDUSTRIAL SALES PHILIPPINES? "2. Is there a need for us to separate the set of books which was not the real intention in the registration of the new business name but merely to advertise our product and distinguish the name of the division as reflected in the new business name PANASONIC INDUSTRIAL SALES PHILIPPINES? "3. Is there any violation to any existing rule of the department if we will reflect on the invoice and other documents of INDUSTRIAL SALES DIVISION the new business name PANASONIC INDUSTRIAL SALES PHILIPPINES (DIVISION OF MATSUSHITA ELECTRIC PHILIPPINES CORPORATION)?" In reply, please be informed of the following: 1. Section 236(J) of the Tax Code of 1997 provides that any person required under the authority of the Code to make, render or file a return, statement or other document shall be supplied with or assigned a Taxpayer Identification Number (TIN) which he shall indicate in such return, statement or document filed with the Bureau of Internal Revenue for his proper identification for tax purposes, . . .. Being merely an Industrial Sales Division of Matsushita Electric Philippines Corporation, PANASONIC INDUSTRIAL SALES PHILIPPINES is not to be treated as a separate and distinct entity and is no longer required to procure a TIN of its own, since the return or statement of the former necessarily includes that of the latter. 2. Section 232(A) of the Tax Code of 1997 provides that all corporations, companies, partnerships or persons required by law to pay internal revenue taxes shall keep a journal and a ledger or their equivalent: . . .. While it is true that Panasonic Industrial Sales Philippines is merely a division of Matsushita Electric Philippines Corporation, it is nevertheless deemed as a marketing arm of the latter, where its activities are not limited to the advertisement of its product under the new business name but also sales are perfected therein. Consequently, Panasonic Industrial Sales Philippines is under obligation to keep a subsidiary books of accounts and records for its purpose. IHEAcC 3. Finally, since there is no violation under Revenue Regulations No. V-1, otherwise known as the "Bookkeeping Regulations", the Panasonic Industrial Sales Philippines, an industrial sales division of Matsushita Electric Philippines Corporation, together with the other divisions with distinctive names, may be allowed to use and reflect in its voices and documents of sales the distinctive names of all the divisions of the company provided the company name "Matsushita Electric Philippines Corporation" shall still be prominent business name that should be reflected on the invoice/receipts. The inclusion of the distinctive name "Panasonic Industrial Sales Philippines" should still reflect that this name refers to just a division of Matsushita Electric Philippines Corp. Provided further that the invoices/receipts are serially numbered and shall show among others, the name, business style, Taxpayer Identification Number (TIN), with the word "VAT-registered" and business address of Matsushita Electric Philippines Corporation; date of transaction; quantity; unit cost; description of the merchandise/service; total amount which the purchaser pays or is obligated to pay to the seller; name of the buyer, business style of the buyer, address of the buyer or client, and Taxpayer Identification Number of the buyer, if a VAT-registered person; pursuant to Section 238, 237 and 113 of the Tax Code of 1997. (BIR Ruling No. 133-99 dated August 24, 1999) This ruling is being issued on the basis of the foregoing representation. If upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. Very truly yours, Commissioner of Internal Revenue By: (SGD.) LILIAN B. HEFTI Deputy Commissioner Legal and Inspection Group