Dole Philippines, Inc. v. Commissioner of Internal Revenue

SPECIAL SECOND DIVISION [C.T.A. CASE NO. 10212. June 13, 2023.] DOLE PHILIPPINES, INC. , petitioner , vs. COMMISSIONER OF INTERNAL REVENUE , respondent . DECISION CUI-DAVID , J p : Before this Court is a Petition for Review filed on November 13, 2019 by petitioner Dole Philippines, Inc. 1 ("Petitioner") , against respondent Commissioner of Internal Revenue ( "CIR" or "Respondent" ), under Section 3 (a), Rule 8, 2 in relation to Section 3 (a) (1), Rule 4 3 of the Revised Rules of the Court of Tax Appeals 4 ("RRCTA") , praying that judgment be rendered ordering respondent to refund petitioner the denied portion of its claim for refund of unutilized input value-added tax ("VAT") attributable to zero-rated sales for the period from April 1, 2017 to March 31, 2018 in the aggregate amount of P325,271,543.33. HTcADC THE PARTIES Petitioner Dole Philippines, Inc. is a corporation duly organized and existing under the laws of the Republic of the Philippines, with principal address at Cannery Site, Cannery, Polomolok, Sarangani Economic Development Zone, South Cotabato. 5 Petitioner's primary purpose is "to acquire, own, lease, hold, cultivate, develop, operate and maintain agricultural lands, grazing lands, farms, plantations, orchards and, gardens, cattle and other ranches, and to plant, grow, cultivate and harvest pineapples and other agricultural crops and raise and breed cattle and other kinds of animals therein and thereon; to produce, process, can, manufacture, freeze, preserve, refine, pack, buy and sell and otherwise deal in and with said cattle, other animals, pineapples, other agricultural crops, and other products of the land, including the products and by-products thereof, and for such and be such purposes to acquire, construct, lease, own, maintain and operate cold storage plants, slaughter houses, canneries, mills, factories, railroads, airplanes, ships, lighters, docks, piers, warehouses, storage and shipping facilities, buildings, structures and works of all kinds, wireless plants, instruments and apparatus, and all machinery, equipment and appliances which may be required, needed or used in connection therewith, for making manufacturing, storing, maintaining and transporting its crops, supplies, products and other property, and for other purposes incidental to any of its business; and to acquire, construct, maintain and operate pumping plants, irrigation systems and other works for the development, conservation, storage, transmission and utilization of water, including artesian wells, shafts, tunnels, pipe lines, ditches, flunes, dams, reservoirs and other works, and to do all of the things incidental to or proper in the business of acquiring water for its own use." 6 It is registered with the Bureau of Internal Revenue ("BIR") as a VAT-registered taxpayer with Tax Identification Number ("TIN") 000-428-573. 7 Its branches throughout the Philippines are likewise registered with the BIR. 8 CAIHTE Respondent Commissioner of Internal Revenue is empowered to perform the duties of his office, including acting upon on protest cases and approval of claims for refund or tax credit as provided by law and implementing regulations. He can be served with notices at BIR National Office Bldg., BIR Road, Diliman, Quezon City. 9 THE FACTS On June 28, 2019, petitioner filed an Application for Tax Credits/Refunds (BIR Form No. 1914), 10 with a Sworn Statement executed by Ms. Rhodora U. Cagampan, 11 under Section 112 of the National Internal Revenue Code ("NIRC") of 1997, as amended, for the refund of VAT, in the amount of P1,218,800,809.92 for the period from April 1, 2017 to March 31, 2018 with the BIR's VAT Credit Audit Division ("VCAD") . On October 16, 2019, petitioner received the VAT Refund Notice 12 dated August 29, 2019, and Tax Verification Notice No. TVN2018000083093 13 dated June 28, 2019, issued by respondent, partially granting petitioner's administrative claim in the amount of P893,529,266.59. Petitioner filed a Petition of Review on November 13, 2019. 14 On January 31, 2020, within the extended time granted by the Court, 15 respondent filed his Answer . 16 The Pre-Trial Conference was initially set on February 27, 2020. 17 However, on February 13, 2020, petitioner filed a Motion to Reset Pre-Trial Conference , 18 which the Court granted. 19 Petitioner's Pre-Trial Brief was filed on June 23, 2020, 20 Respondent's Pre-Trial Brief was submitted on June 26, 2020. 21 The Pre-Trial Conference was eventually held on June 29, 2020. 22 On July 20, 2020, petitioner filed a Manifestation , 23 stating that the parties have disagreed on certain stipulations of issues; thus, they will no longer file a Joint Stipulation of Facts and Issues . In the Resolution dated July 29, 2020, 24 the Court noted the Manifestation . On September 8, 2020, respondent transmitted the BIR Records of this case, consisting of one (1) folder, consecutively numbered as pages 1 to 58. 25 The trial ensued, wherein the parties presented their respective documentary and testimonial evidence. aScITE Petitioner offered the testimonies of the following individuals, namely: (1) Mr. Rhodora U. Cagampan, 26 Tax Manager of Dole Asia Company Ltd.; and (2) Ms. Sonia D. Segovia, 27 the Court-commissioned independent certified public accountant ("ICPA") . 28 The Report of the ICPA was submitted on January 12, 2021, consisting of eight (8) binders. 29 Petitioner filed its Formal Offer of Evidence on February 26, 2020. 30 On March 5, 2021, respondent posted a Motion to Admit Attached Comment on Petitioner's Formal Offer of Evidence . 31 In its Resolution dated March 22, 2021, 32 the Court granted the Motion and admitted the attached Comment/Opposition (to Petitioner's Formal Offer of Evidence) with Manifestation . 33 In the Resolution dated July 12, 2021, 34 the Court admitted petitioner's offered exhibits, except for the following: 1. Exhibits "P-1", "P-2", "P-2-A", "P-3", "P-3-A" to "P-3-Z", "P-11", "P-11-A" to "P-11-C", "P-12", "P-13-A", "P-13-B", "P-54" to "P-65", "P-68", "P-69", "P-71" to "P-73", and "P-74", for failure to submit the duly marked exhibits with the indication that the same are accordingly the original computer print-out, certified true copies or faithful reproduction of the originals; and 2. Exhibits "P-88-ae", "P-105-abl", "P-105-aew", "P-248-aw", "P-251-ak", "P-315-a", "P-334-b", "P-334-d", "P-441-wo", "P-441-agb", "P-442-em", "P-442-ig", "P-442-pe", "P-442-aag", "P-442-acq", and "P-442-aml", as the foregoing documents could not be found in the USB containing the softcopies of the exhibits identified in the ICPA Report . Consequently, on August 3, 2021, petitioner filed a Motion for Partial Reconsideration to the Resolution dated July 12, 2021 , 35 praying that this Court admit the denied exhibits. Respondent filed his Manifestation on November 24, 2021. 36 In the Resolution dated February 14, 2022, 37 the Court granted petitioner's Motion for Partial Reconsideration and admitted Exhibits "P-1", "P-2", "P-2-A", "P-3", "P-3-A" to "P-3-Z", "P-11", "P-11-A" to "P-11-C", "P-12", "P-13-A", "P-13-B", "P-54" to "P-65", "P-68", "P-69", "P-71" to "P-73", "P-74", "P-88-ae", "P-105-abl", "P-105-aew", "P-248-aw", "P-251-ak", "P-315-a", "P-334-b", "P-334-d", "P-441-wo", "P-441-agb", "P-442-em", "P-442-ig", "P-442-pe", "P-442-aag", "P-442-acq", and "P-442-aml". In the meantime, respondent, for his part, offered the testimony of Revenue Officer ("RO") Daniel Carlo C. Perez. 38 Respondent's Formal Offer of Evidence was filed on December 1, 2021. 39 Petitioner filed its Comment/Opposition (To the Respondent's Formal Offer of Evidence) . 40 In the Resolution dated February 14, 2022, 41 the Court admitted all respondent's offered exhibits. DETACa On March 8, 2022, respondent filed his Memorandum , 42 while petitioner filed its Memorandum on March 9, 2022. 43 The present case was submitted for decision on March 14, 2022. 44 However, on March 28, 2022, petitioner filed an Urgent Motion to Re-Open the Case . 45 Respondent failed to file his comment/opposition thereon. 46 In the Resolution dated June 16, 2022, 47 the Court denied petitioner's Urgent Motion to Re-Open the Case for lack of merit and submitted the present case for decision anew. Hence, this Decision . THE ISSUE Petitioner raised the following issue for the resolution of the Court: WHETHER PETITIONER IS ENTITLED TO THE DENIED PORTION OF CLAIM FOR REFUND ON THE EXCESS AND UNUTILIZED INPUT VALUE-ADDED TAX (VAT) FOR THE PERIOD APRIL 1, 2017 TO MARCH 31, 2018 AMOUNTING TO P325,271,543.33. PETITIONER'S ARGUMENTS Petitioner argues that it is a VAT-registered taxpayer whose sales are entitled to VAT zero-rating. 48 Petitioner cites Section 106 (A) (2) (a) of the NIRC of 1997, as amended, as the legal basis for its zero-rating. 49 Petitioner further avers that it had unutilized and unapplied input tax credits from April 1, 2017 to March 31, 2018 directly attributable to its zero-rated sales in the aggregate amount of P1,218,800,809.92. 50 Petitioner also claims that it timely filed its administrative claim for refund within the two-year prescriptive period, 51 and that it timely filed its Petition for Review with the Court. 52 Petitioner then argues that it should have been refunded the denied portion of P325,271,543.33 covering the period from April 1, 2017 to March 31, 2018. 53 It states that respondent erred in imputing output VAT from its zero-rated sales to Board of Investments ("BOI") , Subic Bay Metropolitan Authority ("SBMA") , and Clark Development Corporation ("CDC") enterprises 54 as they are allegedly properly classified as zero-rated sales under Revenue Regulations ("RR") No. 16-2005, as amended. Petitioner likewise impugns respondent's allocation of additional input VAT amounting to P51,333.07 to alleged unremitted export sales. 55 Petitioner further assails respondent's findings that it overclaimed input VAT amounting to P2,404,031.31, contending that petitioner only claimed input taxes properly substantiated with official receipts and invoices. 56 Petitioner assails respondent's findings that it claimed input VAT amounting to P22,146,144.05 that is out of period and argues that these were incurred from April 1, 2017 to March 31, 2018. 57 Petitioner assails the disallowance of P754,178.95 of its input VAT for allegedly being purchases from non-VAT registered suppliers based on the verification of the Integrated Tax System ("ITS") , contending that these are supported by invoices and official receipts from VAT-registered suppliers. 58 HEITAD Further, petitioner claims that, contrary to respondent's findings, P686,204.43 of its input VAT were from petitioner's suppliers who were properly issued with Authority to Print, 59 P949,485.63 of its input VAT were evidenced by invoices and official receipts that are readable, 60 P52,409.19 of its input VAT were not claimed twice, 61 P402,274.97 of its input VAT were evidenced by official receipts and invoices in which the Authority to Print is indicated, 62 P56,544.48 of its input VAT and P40,077.44 of its final withholding VAT were substantiated, 63 P61,520.00 of its input VAT were separately billed in the Bureau of Customs ("BOC") Statement of Settlement of Duties and Taxes ("SSDT") , 64 P15,186,044.55 of its input VAT were collaborated [sic] with other supporting documents despite the fact that the invoices contained alterations, 65 P1,382,553.27 of its input VAT were not overclaimed but "pertain to the difference between the petitioner's actual amount of input VAT allocable to exempt sales per VAT returns versus VCAD's computed allocation of input VAT on exempt sales," 66 and P2,933,642 of its input VAT on importation were properly supported with sales invoice, import entry, and other documents showing actual payment of VAT. 67 Petitioner further argues that the imposition of the compromise penalty amounting to P12,500.00 is improper considering that the same is without its conformity. 68 However, petitioner agrees with the finding of respondent that input tax in the amount of P1,075,123.00 pertains to the bond already refunded by the BOC 69 and that its deferred input VAT amounting to P5,144,460.88 should be disallowed. 70 RESPONDENT'S ARGUMENTS Respondent argues that petitioner failed to comply with the mandatory requirements for claiming a refund or tax credit. 71 According to respondent, petitioner's input VAT on Big Ticket purchases in the amount of P973,750 was disallowed for failure to attach supporting documents, such as a debit note or sales invoice, for being supported by altered invoices, and for being out-of-period. 72 Respondent also posits that petitioner's input tax on importations in the amount of P2,933,642 was likewise disallowed for failure to present the corresponding invoices and/or out-of-period SSDT. 73 Respondent states that petitioner has additional overclaimed input VAT in the amount of P1,382,553.27 pertaining to the discrepancy on input tax claimed based on Net Available Input Tax per VAT returns of fiscal year ("FY") 2018 as against the Application for Tax Credits/Refunds (BIR Form No. 1914). 74 aDSIHc According to respondent, petitioner's zero-rated sales were not properly substantiated, resulting in an allocated and disallowed input tax amount of P18,409,246.48. 75 Finally, respondent states that refund claims are construed strictly against the claimant for the same partake of the nature of exemption from taxation and, as such, they are looked upon with disfavor. 76 THE COURT'S RULING The Petition for Review is partly meritorious. The Court has jurisdiction over the instant Petition . Before proceeding to the merits of the case, We shall determine whether the Court has jurisdiction to take cognizance of this case. Section 7 (a) (1) of Republic Act ("RA") No. 9282, 77 amending RA No. 1125, 78 provides that: Section 7. Jurisdiction . The CTA shall exercise: (a) Exclusive appellate jurisdiction to review by appeal, as herein provided: xxx xxx xxx (1) Decisions of the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of internal revenue taxes , fees or other charges, penalties in relation thereto, or other matters arising under the National Internal Revenue Code or other laws administered by the Bureau of Internal Revenue [Emphasis and underscoring supplied.] The above provision is implemented by Section 3 (a) (1), Rule 4 of the RRCTA, 79 to wit: Section 3. Cases within the jurisdiction of the Court in Division . The Court in Division shall exercise: (a) Exclusive original or appellate jurisdiction to review by appeal the following: xxx xxx xxx (1) Decisions of the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of internal revenue taxes , fees or other charges, penalties in relation thereto, or other matters arising under the National Internal Revenue Code or other laws administered by the Bureau of Internal Revenue [Emphasis and underscoring supplied.] The records show that on October 16, 2019, petitioner received the VAT Refund Notice 80 dated August 29, 2019, and Tax Verification Notice No. TVN2018000083093 81 dated June 28, 2019, issued by respondent, partially granting petitioner's administrative claim in the amount of P893,529,266.59. Under Section 3 (a), Rule 8 82 of the RRCTA, petitioner had thirty (30) days from receipt of the partial denial on October 16, 2019, or until November 15, 2019, to file a Petition for Review before the CTA. ATICcS Petitioner timely filed its Petition of Review on November 13, 2019. 83 Having settled that the Petition was timely filed, We likewise rule that the Court has the requisite jurisdiction to take cognizance of this Petition under Section 3 (a) (1), Rule 4 84 of the RRCTA. We now proceed to the merits of the case. Section 112 (A) and (C) of the NIRC of 1997, as amended, provides: SEC. 112. Refunds or Tax Credits of Input Tax . (A) Zero-rated or Effectively Zero-rated Sales . Any VAT-registered person, whose sales are zero-rated or effectively zero-rated may, within two (2) years after the close of the taxable quarter when the sales were made, apply for the issuance of a tax credit certificate or refund of creditable input tax due or paid attributable to such sales, except transitional input tax, to the extent that such input tax has not been applied against output tax: Provided, however, That in the case of zero-rated sales under Section 106(A)(2)(a)(1), (2) and (b) and Section 108 (B)(1) and (2), the acceptable foreign currency exchange proceeds thereof had been duly accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP): Provided, further, That where the taxpayer is engaged in zero-rated or effectively zero-rated sale and also in taxable or exempt sale of goods of properties or services, and the amount of creditable input tax due or paid cannot be directly and entirely attributed to any one of the transactions, it shall be allocated proportionately on the basis of the volume of sales. Provided, finally, That for a person making sales that are zero-rated under Section 108(B) (6), the input taxes shall be allocated ratably between his zero-rated and non-zero-rated sales. (B) . . . (C) Period within which Refund of Input Taxes shall be Made . In proper cases, the Commissioner shall grant a refund for creditable input taxes within ninety (90) days from the date of submission of the official receipts or invoices and other documents in support of the application filed in accordance with Subsections (A) and (B) hereof: Provided, That should the Commissioner find that the grant of refund is not proper, the Commissioner must state in writing the legal and factual basis for the denial. In case of full or partial denial of the claim for tax refund, the taxpayer affected may, within thirty (30) days from the receipt of the decision denying the claim, appeal the decision with the Court of Tax Appeals: Provided, however, That failure on the part of any official, agent, or employee of the BIR to act on the application within the ninety (90)-day period shall be punishable under Section 269 of this Code. ETHIDa Based on the foregoing and as culled from jurisprudence, particularly Commissioner of Internal Revenue vs. Toledo Power Co. , 85 the requisites for claiming unutilized or excess input VAT under Section 112 of the NIRC of 1997, as amended, are as follows: As to the timeliness of the filing of the administrative and judicial claims : 1. The claim is filed with the BIR within two years after the close of the taxable quarter when the sales were made; 86 2. In case of full or partial denial of the refund claim, or the failure on the part of the Commissioner to act on the said claim within a period of [90] days, the judicial claim shall be filed with this Court within 30 days from receipt of the decision or after the expiration of the said [90]-day period; 87 Concerning the taxpayer's registration with the BIR : 3. The taxpayer is a VAT-registered person; 88 In relation to the taxpayer's output VAT : 4. The taxpayer is engaged in zero-rated or effectively zero-rated sales; 89 5. For zero-rated sales under Sections 106 (A) (2) (1) and (2); 106 (B); and 108 (B) (1) and (2) of the NIRC of 1997, as amended, the acceptable foreign currency exchange proceeds have been duly accounted for in accordance with the Bangko Sentral ng Pilipinas ("BSP") rules and regulations; 90 As regards the taxpayer's input VAT being refunded : 6. The input taxes are not transitional; 91 7. The input taxes are due or paid; 92 8. The input taxes claimed are attributable to zero-rated or effectively zero-rated sales. However, where there are both zero-rated or effectively zero-rated sales and taxable or exempt sales, and the input taxes cannot be directly and entirely attributable to any of these sales, the input taxes shall be proportionately allocated on the basis of sales volume; 93 and 9. The input taxes have not been applied against output taxes during and in the succeeding quarters. 94 We discuss each requisite in seriatim . TIADCc First and second requisites: Petitioner's administrative and judicial claims for refund were timely filed . The first requisite pertains to filing the claim for a tax credit or refund of input VAT before the BIR within two (2) years from the close of the taxable quarter when the zero-rated or effectively zero-rated sales were made. In the present case, petitioner seeks to refund its unutilized input taxes attributable to its VAT zero-rated sales for the four taxable quarters or for the period covering from April 1, 2017 to March 31, 2018. Counting two years from the close of the subject taxable quarters, petitioner had until the following dates to file its administrative claim: Period Covered Close of the Taxable Quarter Last Day to File Administrative Claim 1st Quarter (April 1 to June 30, 2017) June 30, 2017 June 30, 2019 2nd Quarter (July 1 to September 30, 2017) September 30, 2017 September 30, 2019 3rd Quarter (October 1 to December 31, 2017) December 31, 2017 December 31, 2019 4th Quarter (January 1 to March 31, 2018) March 31, 2018 March 31, 2020 Records reveal that on June 28, 2019 , petitioner filed an Application for Tax Credits/Refunds (BIR Form No. 1914) 95 with a Sworn Statement executed by Ms. Rhodora U. Cagampan. 96 Accordingly, We rule that the administrative claim for refund was seasonably filed. The second requisite is to the effect that the judicial claim for refund must have been filed within thirty (30) days from receipt of respondent's decision or after the expiration of the ninety (90)-day period under the afore-quoted Section 112 (C) of the NIRC of 1997, as amended. Notably, under Section 4.108-5 of RR No. 13-2018, 97 all applications filed from January 1, 2018 shall be processed and decided within ninety (90) days from the filing of the VAT refund application, while those filed before January 1, 2018, shall still be governed by the one hundred twenty (120) days processing period. In this case, from filing petitioner's administrative claim on June 28, 2019 , respondent had ninety (90) days, or until September 26, 2019, 98 to act on the claim. Records show that on August 29, 2019, or before the lapse of the 90 days, respondent issued the VAT Refund Notice partially denying petitioner's administrative claim. However, petitioner received the VAT Refund Notice dated August 29, 2019 only on October 16, 2019; 99 thus, it had 30 days from October 16, 2019 or until November 15, 2019, to file a judicial claim. Petitioner timely filed its judicial claim via the present Petition for Review 100 on November 13, 2019. Based on the foregoing, petitioner has complied with the first and second requisites. cSEDTC Third requisite: Petitioner is a VAT-registered entity . In determining whether petitioner is VAT-registered, reference may be made to its BIR Certificate of Registration (BIR Form No. 2303). A perusal of petitioner's Certificates of Registration for its Head Office 101 and its branches 102 indeed reveals that it is a VAT-registered taxpayer. As this is undisputed, We rule that the third requisite has been complied with. Having settled that petitioner is a VAT-registered taxpayer, and its administrative and judicial claims have been timely filed, We now proceed to determine whether it is entitled to its claim for refund of unutilized input VAT attributable to zero-rated sales. Fourth and fifth requisites: Petitioner had zero-rated sales or effectively zero-rated sales from April 1, 2017 to March 31, 2018 but only in the amount of P31,384,368,317.33 . The fourth and fifth requisites require that the taxpayer be engaged in zero-rated or effectively zero-rated sales. For zero-rated sales under Sections 106 (A) (2) (a) (1), (2) and (b), and 108 (B) (1) and (2), of the NIRC of 1997, as amended, the acceptable foreign currency exchange proceeds have been duly accounted for in accordance with BSP rules and regulations. In its Amended Quarterly VAT Returns for the period covering April 1, 2017 to March 31, 2018, petitioner reported total sales of P36,785,576,550.64, which include VATable sales amounting to P2,660,376,823.43, zero-rated sales amounting to P33,665,195,868.50, and exempt sales amounting to P460,003,858.71, as shown below: AIDSTE Type 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total Exhibit "P-450-c" Exhibits "P-29" 103 and "P-450-e" Exhibits "P-35" 104 and "P-450-g" Exhibit "P-450-k" VATable Sales P482,892,177.20 P530,575,094.07 P1,098,117,625.79 P548,791,926.37 P2,660,376,823.43 Zero-Rated Sales 7,595,583,535.40 8,016,662,548.70 9,057,437,267.87 8,995,512,516.53 33,665,195,868.50 Exempt Sales 99,800,626.19 106,274,290.52 138,792,991.18 115,135,950.82 460,003,858.71 Total P8,178,276,338.79 P8,653,511,933.29 P10,294,347,884.84 P9,659,440,393.72 P36,785,576,550.64 Petitioner alleged that its zero-rated sales were derived from its export sales of goods to Dole Asia Holdings Pte. Ltd. 105 ("DAH") and sales to export-oriented entities registered with the BOI, SBMA, PEZA, and CDC, 106 which were paid for in acceptable foreign currency and accounted for in accordance with the BSP rules and regulations, during the period April 1, 2017 to March 31, 2018, under Section 106 (A) (2) (a) (1) and (5) of the NIRC of 1997, as amended, to wit: Customer BOI/SBMA/CDC Registered Amount Century Pacific Agricultural Ventures, Inc. BOI P40,744,193.57 General Tuna Corporation BOI 2,920,155.24 General Tuna Corporation BOI 115,280.00 Hi-Las Marketing Corporation BOI 46,134.01 Philbest Canning Corporation BOI 2,065,000.00 Amley Food Corporation BOI 17,800.00 Gem Foods International, Inc. SBMA 1,277,796.65 Millbrae Exports, Inc. CDC 2,095,710.00 Millbrae Exports, Inc. CDC (4,040.00) 107 Total Zero-rated Sales to Export Oriented Entities P49,278,029.47 108 Dole Asia Holdings ("DAH") Pte. Ltd. Non-Resident Foreign Corporation 33,615,800,744.79 109 Total Zero-rated Sales P33,665,078,744.26 Total Zero-rated Sales per VAT Return P33,665,195,868.50 Difference (P117,094.24) As can be gleaned from the table above, the total zero-rated sales accounted for is lower than the P33,665,195,868.50 zero-rated sales declared per amended Quarterly VAT return by P117,094.24. Ms. Sonia D. Segovia, the Court-commissioned ICPA, noted in her report that the difference of P117,094.24 between the total zero-rated sales in the Summary List of Sales ("SLS") 110 amounting to P33,665,195,868.50 and Schedule of Zero-Rated Sales of Goods 111 amounting to P33,665,078,774.26, pertains to Corrugated Sales which was declared in both regular VAT-subject sales and zero-rated sales in the SLS. 112 Thus, the zero-rated sales declared per VAT return were overstated. SDAaTC Accordingly, only the total amount of P33,665,078,744.26 will be considered and be subjected to further scrutiny, while the P117,094.24 export sales will automatically be disallowed VAT zero-rating absent any document supporting the same. The relevant provision in determining whether petitioner's sales are subject to VAT at zero percent (0%) is Section 106 (A) (2) (a) (1) and (5) of the NIRC of 1997, as amended, as quoted hereunder for easy reference: "SEC. 106. Value-Added Tax on Sale of Goods or Properties . (A) Rate and Base of Tax . x x x (2) The following sales by VAT-registered persons shall be subject to zero percent (0%) rate: (a) Export Sales . The term 'export sales' means: (1) The sale and actual shipment of goods from the Philippines to a foreign country, irrespective of any shipping arrangement that may be agreed upon which may influence or determine the transfer of ownership of the goods so exported and paid for in acceptable foreign currency or its equivalent in goods or services, and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP); xxx xxx xxx (5) Those considered export sales under Executive Order No. 226, otherwise known as the Omnibus Investments Code of 1987, and other special laws." Relative thereto, Section 4.106-5 of RR No. 16-2005, 113 as amended by RR No. 4-2007, 114 provides: "SEC. 4.106-5. Zero-Rated Sales of Goods or Properties . . . . The following sales by VAT-registered persons shall be subject to zero percent (0%) rate: (a) Export Sales . 'Export Sales' shall mean: (1) The sale and actual shipment of goods from the Philippines to a foreign country, irrespective of any shipping arrangement that may be agreed upon which may influence or determine the transfer of ownership of the goods so exported, paid for in acceptable foreign currency or its equivalent in goods and services, and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP); xxx xxx xxx (5) Transactions considered export sales under Executive Order No. 226, otherwise known as the Omnibus Investments Code of 1987 and other special laws. AaCTcI 'Considered export sales under Executive Order No. 226' shall mean the Philippine port F.O.B. value determined from invoices, bills of lading, inward letters of credit, landing certificates, and other commercial documents, of export products exported directly by a registered export producer, or the net selling price of export products sold by a registered export producer to another export producer, or to an export trader that subsequently exports the same; Provided , That sales of export products to another producer or to an export trader shall only be deemed export sales when actually exported by the latter, as evidenced by landing certificates or similar commercial documents; Provided, further , That pursuant to EO 226 and other special laws, even without actual exportation, the following shall be considered constructively exported: (1) sales to bonded manufacturing warehouses of export-oriented manufacturers; (2) sales to export processing zones pursuant to Republic Act (RA) Nos. 7916, as amended, 7903, 7922 and other similar export processing zones; (3) sale to enterprises duly registered and accredited with the Subic Bay Metropolitan Authority pursuant to RA 7227; (4) sales to registered export traders operating bonded trading warehouses supplying raw materials in the manufacture of export products under guidelines to be set by the Board in consultation with the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC); (5) sales to diplomatic missions and other agencies and/or instrumentalities granted tax immunities, of locally manufactured, assembled or repacked products whether paid for in foreign currency or not. For purposes of zero-rating, the export sales of registered export traders shall include commission income. The exportation of goods on consignment shall not be deemed export sales until the export products consigned are in fact sold by the consignee: and Provided, finally , that sales of goods, properties or services made by a VAT-registered supplier to a BOI-registered manufacturer/producer whose products are 100% exported are considered export sales. A certification to this effect must be issued by the Board of Investment (BOI) which shall be good for one year unless subsequently re-issued by the BOI." [Underscoring supplied] Moreover, petitioner must comply with the pertinent invoicing requirements, containing all the required information under Section 113 (A) and (B) of the NIRC of 1997, as amended, to wit: "SEC. 113. Invoicing and Accounting Requirements for VAT-Registered Persons . (A) Invoicing Requirements . A VAT-registered person shall issue: acEHCD (1) A VAT invoice for every sale, barter or exchange of goods or properties; and (2) A VAT official receipt for every lease of goods or properties, and for every sale, barter or exchange of services. (B) Information Contained in the VAT Invoice or VAT Official Receipt . The following information shall be indicated in the VAT invoice or VAT official receipt: (1) A statement that the seller is a VAT-registered person, followed by his taxpayer's identification number (TIN); (2) The total amount which the purchaser pays or is obligated to pay to the seller with the indication that such amount includes the value-added tax: Provided , That: (a) The amount of the tax shall be shown as a separate item in the invoice or receipt; (b) If the sale is exempt from value-added tax, the term 'VAT-exempt sale' shall be written or printed prominently on the invoice or receipt; (c) If the sale is subject to zero percent (0%) value-added tax, the term 'zero-rated sale' shall be written or printed prominently on the invoice or receipt; (d) If the sale involves goods, properties or services some of which are subject to and some of which are VAT zero-rated or VAT-exempt, the invoice or receipt shall clearly indicate the breakdown of the sale price between its taxable, exempt and zero-rated components, and the calculation of the value-added tax on each portion of the sale shall be shown on the invoice or receipt: Provided , That the seller may issue separate invoices or receipts for the taxable, exempt, and zero-rated component of the sale. (3) The date of transaction, quantity, unit cost and description of the goods or properties or nature of the service; and (4) In the case of sales in the amount of One thousand pesos (P1,000.00) or more where the sale or transfers is made to a VAT-registered person, the name, business style, if any, address and Taxpayer Identification Number (TIN) of the purchaser, customer, or client." [Emphasis supplied.] EcTCAD The above provision on invoicing requirement is further implemented by Section 4.113-1 (A) and (B) of RR No. 16-2005, 115 as amended, to wit: SEC. 4.113-1. Invoicing Requirements . (A) A VAT-registered person shall issue: (1) A VAT invoice for every sale, barter or exchange of goods or properties; and (2) A VAT official receipt for every lease of goods or properties, and for every sale, barter or exchange of services. Only VAT-registered persons are required to print their TIN followed by the word "VAT" in their invoice or official receipts. Said documents shall be considered as a "VAT Invoice" or "VAT official receipt." All purchases covered by invoices/receipts other than VAT Invoice/VAT Official Receipt shall not give rise to any input tax. VAT invoice/official receipt shall be prepared at least in duplicate, the original to be given to the buyer and the duplicate to be retained by the seller as part of his accounting records. (B) Information contained in VAT invoice or VAT official receipt . The following information shall be indicated in VAT invoice or VAT official receipt: (1) A statement that the seller is a VAT-registered person, followed by his TIN; (2) The total amount which the purchaser pays or is obligated to pay to the seller with the indication that such amount includes the VAT; Provided , That: (a) The amount of tax shall be shown as a separate item in the invoice or receipt; (b) If the sale is exempt from VAT, the term "VAT-exempt sale" shall be written or printed prominently on the invoice or receipt; (c) If the sale is subject to zero percent (0%) VAT, the term "zero-rated sale" shall be written or printed prominently on the invoice or receipt; (d) If the sale involves goods, properties or services some of which are subject to and some of which are VAT zero-rated or VAT-exempt, the invoice or receipt shall clearly indicate the break-down of the sale price between its taxable, exempt and zero-rated components, and the calculation of the VAT on each portion of the sale shall be shown on the invoice or receipt. The seller has the option to issue separate invoices or receipts for the taxable, exempt, and zero-rated components of the sale. (3) In the case of sales in the amount of one thousand pesos (P1,000.00) or more where the sale or transfer is made to a VAT-registered person, the name, business style, if any, address and TIN of the purchaser, customer or client, shall be indicated in addition to the information required in (1) and (2) of this Section. SDHTEC In addition to the above requirements, the sales invoices ("SIs") and official receipts ("ORs") must be duly registered with the BIR as prescribed under Section 237, in relation to Section 238 of the NIRC of 1997, as amended, to wit: SEC. 237. Issuance of Receipts or Sales or Commercial Invoices . All persons subject to an internal revenue tax shall, for each sale or transfer of merchandise or for services rendered valued at Twenty-five pesos (P25.00) or more, issue duly registered receipts or sales or commercial invoices , prepared at least in duplicate, showing the date of transaction, quantity, unit cost and description of merchandise or nature of service. . . . SEC. 238. Printing of Receipts or Sales or Commercial Invoices . All persons who are engaged in business shall secure from the Bureau of Internal Revenue an authority to print receipts or sales or commercial invoices before a printer can print the same. No authority to print receipts or sales or commercial invoices shall be granted unless the receipts or invoices to be printed are serially numbered and shall show, among other things, the name, business style, Taxpayer Identification Number (TIN) and business address of the person or entity to use the same, and such other information that may be required by rules and regulations to be promulgated by the Secretary of Finance, upon recommendation of the Commissioner. [Underscoring supplied] Thus, only the sales of goods or services supported by the SIs and ORs, having the required information, shall qualify for VAT zero-rating. Export Sales of goods to DAH Based on the foregoing, for petitioner's export sales of goods to qualify as zero-rated pursuant to Section 106 (A) (2) (a) (1) of the NIRC of 1997, as amended, the following essential elements must be present: 1. The sale was made by a VAT-registered person; 2. There was a sale and actual shipment of goods from the Philippines to a foreign country; and 3. The sale was paid for in acceptable foreign currency accounted for in accordance with the rules and regulations of the BSP. Corollary thereto, We have consistently ruled that any VAT-registered person claiming for VAT zero-rating on its export sale of goods must present to the Court at least three (3) types of documents, as follows: HSAcaE 1. The sales invoice as proof of sale of goods; 2. The export declaration and bill of lading or airway bill as proof of actual shipment of goods from the Philippines to a foreign country; and 3. The bank credit advice, certificate of bank remittance , or any other document proving payment for the goods in acceptable foreign currency or its equivalent in goods and services. 116 Consequently, only export sales supported by the above-stated documents shall qualify for VAT zero-rating under Section 106 (A) (2) (a) (1) of the NIRC of 1997, as amended. Anent the first element, as discussed earlier, petitioner was able to prove that it is a VAT-registered person. As to the second and third elements, petitioner adduced before this Court, in support of its zero-rated sales, its sales invoices, 117 bills of lading and/or airways bills, 118 export declarations, 119 bank statements, 120 and summary of inward remittances 121 which the ICPA examined. Petitioner claims that it sold its products to Dole Asia Holdings ("DAH") Pte. Ltd. in the total amount of P33,615,800,744.79 122 under the following Intercompany Sales Agreement: 1. Packaged Foods Intercompany Sales Agreement 123 between DAH Pte. Ltd. and Dole Philippines, Inc.; and 2. Intercompany Sales Agreement 124 between DAH Pte. Ltd. and Dole Philippines, Inc.-Stanfilco Division. However, based on respondent's computation of input VAT allocation to zero-rated sales, 125 the total export sales to DAH amounting to P33,615,800,744.79 was adjusted to P28,806,756,419.64, computed as follows: Amount Export Sales to DAH P33,615,800,744.79 126 Less: Adjustments VCAD Adjustment Unremitted export sales (see Schedule 6 of VCAD Working Paper Export Sales and Dollar Remittances page 613 (23,814.26 @ 50.80) P1,209,764.41 127 TARD Adjustments Direct Export Sales which were invalidated by reasons enumerated in Sub-Annex C.1 DOLEFIL 4,494,586,935.85 128 Direct Export Sales which were invalidated by reasons enumerated in Sub-Annex C.2 Stanfilco 188,348,718.03 129 Direct Export Sales which were invalidated by reasons enumerated in Sub-Annex C.3 Dolefil Copperwires and Corrugated Boxes 77,587,326.60 130 Insufficient Remittance of Zero-Rated Sales 47,311,580.26 131 Total Adjustments 4,809,044,325.15 Adjusted Export Sales to DAH P28,806,756,419.64 To summarize, respondent disallowed petitioner's export sales to DAH in the total amount of P4,809,044,325.15 based on the following grounds: AScHCD No. Disallowances Amount 1 Unremitted export sale (see Schedule 6 of VCAD Working Paper Export Sales and Dollar Remittances page 613 (23,814.26 @ 50.80) P1,209,764.41 2 Direct Export Sales which were not properly substantiated (Sub-Annexes C.1 to C.4) 4,807,834,560.74 Total disallowances P4,809,044,325.15 Upon further scrutiny of the pieces of evidence presented, We find that the disallowances made by respondent are partly tenable, as follows: 1. The disallowance of unremitted export sales in the total amount of P1,209,764.41 is proper. Although petitioner offered SI No. 291024 132 evidencing the sale of goods to Beijing Weian Trading Co. Ltd., it failed to show proof of actual shipment. A perusal of the alleged bill of lading 133 and SI No. 291024 indicates that the invoice has incomplete details (such as the date of shipment, vessel name, and voyage number); thus, the Court cannot ascertain if the bill of lading corresponds to the shipment of goods in the said invoice. Since there was no proof of actual shipment, discussing the proof of its inward remittance is futile. Moreover, it can be noted that this was also included in the disallowances under "insufficient remittance to zero-rated sales," amounting to P47,311,580.26. 134 Hence, the disallowances due to insufficient remittance to zero-rated sales should be reduced by P1,209,764.41; and 2. Upon further verification of the documents submitted before the Court, We find that instead of the total export sales amounting to P4,807,834,560.74, only the total amount of P2,232,314,333.05 should be disallowed for being not adequately substantiated, as itemized below: HESIcT 1. Export sales supported by a blurred Bill of Lading ("BL") Date Invoice BL/Airway Bill Proof of Inward Remittance Amount Exhibit Invoice No. Exhibit Exhibit Page No. 04/08/2017 "P-173-a" 90546 "P-442-b" "P-439-a" 2 P15,978.49 04/19/2017 "P-174-a" 90795 "P-442-c" "P-439-b" 1 15,978.49 04/22/2017 "P-174-b" 90796 "P-442-d" "P-439-b" 1 15,978.49 11/15/2017 "P-177-a" 95002 "P-442-t" "P-439-i" 3 16,656.16 01/10/2018 "P-186-a" 96004 "P-442-ai" "P-439-j" 13 16,656.16 06/21/2017 "P-193-a" 92124 "P-442-bc" "P-439-d" 6 18,346.64 06/24/2017 "P-193-b" 92144 "P-442-bd" "P-439-d" 6 16,490.81 06/28/2017 "P-193-c" 92261 "P-442-be" "P-439-d" 8 16,490.81 12/07/2017 "P-210-g" 95400 "P-442-ew" "P-439-i" 12 287,278.73 12/07/2017 "P-210-h" 95401 "P-442-ex" "P-439-i" 12 294,040.66 12/07/2017 "P-210-i" 95404 "P-442-ey" "P-439-i" 12 316,838.88 12/07/2017 "P-210-j" 95406 "P-442-ez" "P-439-i" 12 907,095.30 12/07/2017 "P-210-k" 95408 "P-442-fa" "P-439-i" 12 835,177.69 12/07/2017 "P-212-a" 95405 "P-442-fg" "P-439-i" 12 793,412.34 12/07/2017 "P-212-b" 95407 "P-442-fh" "P-439-i" 12 541,840.41 12/07/2017 "P-212-c" 95410 "P-442-fi" "P-439-i" 12 2,039,695.63 12/07/2017 "P-213-a" 95409 "P-442-fj" "P-439-i" 12 3,003,302.12 12/31/2017 "P-238-p" 95861 "P-442-lu" "P-439-j" 10 334,486.41 06/22/2017 "P-279-c" 92234 "P-442-aaz" "P-439-d" 8 1,290,685.95 09/06/2017 "P-292-b" 93677 "P-442-ada" "P-439-f" 11 263,428.31 12/21/2017 "P-319-d" 95718 "P-442-afi" "P-439-j" 6 1,843,184.94 01/05/2018 "P-319-h" 95938 "P-442-afm" "P-439-j" 12 2,772,806.34 12/21/2017 "P-320-a" 95715 "P-442-aft" "P-439-j" 5 4,382,300.89 01/05/2018 "P-323-a" 95939 "P-442-agf" "P-439-j" 12 5,682,620.99 06/20/2017 "P-323-l" 92117 "P-442-akk" "P-439-d" 6 422,043.06 06/30/2017 "P-332-o" 92278 "P-442-akn" "P-439-d" 9 394,107.48 07/04/2017 "P-332-v" 92406 "P-442-aku" "P-439-d" 12 5,044,028.55 07/04/2017 "P-332-w" 92407 "P-442-akv" "P-439-d" 12 302,184.53 01/25/2018 "P-340-y" 96320 "P-442-aot" "P-439-k" 3 1,390,048.17 02/16/2018 "P-343-k" 96713 "P-442-aro" "P-439-k" 11 1,319,581.30 03/15/2018 "P-345-g" 97291 "P-442-asl" "P-439-l" 8 7,668,876.53 05/27/2017 "P-367-a" 91542 "P-442-avr" "P-439-c" 6 16,178.60 06/07/2017 "P-367-b" 91848 "P-442-avs" "P-439-c" 13 18,489.82 03/22/2018 "P-380-c" 97527 "P-442-awr" "P-439-m" 2 4,223,943.33 03/23/2018 "P-380-e" 97535 "P-442-awt" "P-439-m" 2 266,044.77 03/28/2018 "P-422-a" 86504 "P-442-bbi" "P-439-aa" 11 443,433.73 Subtotal P47,229,731.48 2. Export sales supported by a bill of lading with mismatched BL number indicated in the sales invoice/without BL number indicated in the sales invoice Date Invoice BL/Airway Bill Proof of Inward Remittance Amount Exhibit Invoice No. Exhibit Exhibit Page No. 10/11/2017 "P-174-c" 94364 "P-442-e" "P-439-h" 2 P16,656.16 10/14/2017 "P-174-d" 94378 "P-442-f" "P-439-h" 2 16,656.16 10/18/2017 "P-174-e" 94457 "P-442-g" "P-439-h" 10 16,656.16 10/21/2017 "P-174-f" 94480 "P-442-h" "P-439-h" 10 16,656.16 10/25/2017 "P-174-g" 94617 "P-442-i" "P-439-h" 12 16,656.16 10/28/2017 "P-174-h" 94627 "P-442-j" "P-439-h" 12 16,656.16 11/01/2017 "P-174-i" 94684 "P-442-k" "P-439-h" 14 16,656.16 11/03/2017 "P-174-j" 94687 "P-442-l" "P-439-h" 14 16,656.16 11/08/2017 "P-176-a" 94870 "P-442-m" "P-439-h" 9 16,656.16 11/10/2017 "P-176-b" 94887 "P-442-n" "P-439-h" 9 16,656.16 11/17/2017 "P-176-c" 95017 "P-442-o" "P-439-i" 3 16,656.16 11/22/2017 "P-176-d" 95118 "P-442-p" "P-439-i" 6 16,656.16 11/24/2017 "P-176-e" 95119 "P-442-q" "P-439-i" 6 16,656.16 11/29/2017 "P-176-f" 95239 "P-442-r" "P-439-i" 8 16,656.16 12/01/2017 "P-176-g" 95240 "P-442-s" "P-439-i" 8 16,656.16 11/10/2017 "P-178-a" 94882 "P-442-u" "P-439-h" 9 707,694.93 11/29/2017 "P-181-a" 95235 "P-442-x" "P-439-i" 8 13,390,060.90 04/03/2017 "P-183-a" 90491 "P-442-z" "P-439-a" 1 13,238.86 04/10/2017 "P-183-b" 90492 ''P-442-aa" "P-439-a" 1 16,164.57 10/04/2017 "P-183-c" 90501 "P-442-ab" "P-439-a" 1 16,018.29 10/04/2017 "P-184-a" 90493 "P-442-ac" "P-439-a" 1 17,993.14 10/04/2017 "P-184-b" 90499 "P-442-ad" "P-439-a" 1 16,018.29 10/04/2017 "P-184-c" 90500 "P-442-ae" "P-439-a" 1 16,018.29 10/04/2017 "P-184-d" 90502 "P-442-af" "P-439-a" 1 16,091.43 09/04/2017 "P-185-a" 90722 "P-442-ag" "P-439-b" 2 683,417.23 09/04/2017 "P-185-b" 90723 "P-442-ah" "P-439-b" 2 762,587.46 01/12/2018 "P-186-b" 96005 "P-442-aj" "P-439-j" 13 14,276.71 01/24/2018 "P-186-c" 96263 "P-442-ak" "P-439-k" 1 16,656.16 05/04/2017 "P-187-c" 91080 "P-442-an" "P-439-b" 10 1,264,115.36 05/11/2017 "P-187-f" 91225 "P-442-aq" "P-439-b" 14 1,892,877.26 05/11/2017 "P-187-g" 91239 "P-442-ar" "P-439-b" 14 215,674.79 04/30/2017 "P-188-c" 91049 "P-442-au" "P-439-b" 9 2,990,358.74 04/30/2017 "P-188-d" 91050 "P-442-av" "P-439-b" 9 1,100,169.79 04/30/2017 "P-188-e" 91051 "P-442-aw" "P-439-b" 9 1,100,583.38 05/05/2017 "P-189-a" 91084 "P-442-ay" "P-439-b" 10 258,680.90 04/27/2017 "P-190-a" 90934 "P-442-az" "P-439-b" 7 2,205,722.18 05/11/2017 "P-191-a" 91240 "P-442-ba" "P-439-b" 14 1,235,035.01 05/11/2017 "P-191-b" 91241 "P-442-bb" "P-439-b" 14 828,208.37 07/08/2017 "P-193-d" 92424 "P-442-bf" "P-439-d" 12 16,490.81 07/12/2017 "P-193-e" 92531 "P-442-bg" "P-439-d" 15 11,779.15 07/15/2017 "P-193-f" 92536 "P-442-bh" "P-439-d" 15 11,779.15 07/19/2017 "P-193-g" 92696 "P-442-bi" "P-439-e" 4 11,779.15 08/09/2017 "P-193-h" 93126 "P-442-bj" "P-439-e" 13 11,779.15 08/12/2017 "P-193-i" 93127 "P-442-bk" "P-439-e" 13 14,134.98 09/13/2017 "P-193-j" 93806 "P-442-bl" "P-439-g" 3 14,276.71 09/16/2017 "P-193-k" 93826 "P-442-bm" "P-439-g" 3 16,656.16 09/20/2017 "P-193-l" 93947 "P-442-bn" "P-439-g" 4 14,276.71 09/23/2017 "P-193-m" 93967 "P-442-bo" "P-439-g" 4 16,656.16 09/27/2017 "P-193-n" 94158 "P-442-bp" "P-439-g" 8 14,276.71 09/30/2017 "P-193-o" 94159 "P-442-bq" "P-439-g" 8 16,656.16 10/04/2017 "P-193-p" 94184 "P-442-br" "P-439-g" 9 16,656.16 10/07/2017 "P-193-q" 94185 "P-442-bs" "P-439-g" 9 16,656.16 06/12/2017 "P-195-b" 91975 "P-442-bu" "P-439-d" 2 326,516.88 07/22/2017 "P-196-a" 92802 "P-442-bw" "P-439-e" 6 350,334.65 04/19/2017 "P-214-l" 90834 "P-442-fv" "P-439-b" 4 1,437,993.86 04/13/2017 "P-218-b" 90740 "P-442-gj" "P-439-b" 3 467,760.45 01/30/2018 "P-225-f" 96390 "P-442-gs" "P-439-k" 5 4,890,009.24 02/14/2018 "P-225-k" 96616 "P-442-gx" "P-439-k" 9 2,512,212.61 12/10/2017 "P-227-a" 95499 "P-442-hg" "P-439-j" 1 529,896.17 01/30/2018 "P-227-b" 96391 "P-442-hh" "P-439-k" 5 321,149.20 02/06/2018 "P-227-c" 96510 "P-442-hi" "P-439-k" 7 6,965,812.03 12/06/2017 "P-229-a" 95370 "P-442-hj" "P-439-i" 11 16,656.16 12/08/2017 "P-229-b" 95371 "P-442-hk" "P-439-i" 11 16,656.16 12/13/2017 "P-229-c" 95521 "P-442-hl" "P-439-j" 1 16,656.16 12/15/2017 "P-229-d" 95522 "P-442-hm" "P-439-j" 2 16,656.16 12/20/2017 "P-229-e" 95648 "P-442-hn" "P-439-j" 4 16,656.16 12/22/2017 "P-229-f" 95649 "P-442-ho" "P-439-j" 4 14,276.71 12/27/2017 "P-229-g" 95786 "P-442-hp" "P-439-j" 7 16,656.16 12/29/2017 "P-229-h" 95787 "P-442-hq" "P-439-j" 7 14,276.71 03/02/2018 "P-229-i" 96903 "P-442-hr" "P-439-l" 2 14,479.26 03/14/2018 "P-229-j" 97231 "P-442-hs" "P-439-l" 7 14,479.26 03/16/2018 "P-229-k" 97232 "P-442-ht" "P-439-l" 7 14,479.26 03/21/2018 "P-229-l" 97444 "P-442-hu" "P-439-l" 11 14,479.26 03/23/2018 "P-229-m" 97445 "P-442-hv" "P-439-l" 11 14,479.26 01/16/2018 "P-247-h" 96135 "P-442-bby" "P-439-j" 15 2,147,831.09 01/17/2018 "P-247-i" 96139 "P-442-bbz" "P-439-j" 15 2,249,158.88 01/17/2018 "P-247-j" 96140 "P-442-bca" "P-439-j" 16 1,639,144.27 05/03/2017 "P-255-g" 91131 "P-442-vx" "P-439-b" 11 674,059.62 04/19/2017 "P-265-a" 90959 "P-442-ym" "P-439-b" 7 332.24 07/26/2017 "P-272-a" 92869 "P-442-zm" "P-439-e" 9 742,845.60 04/03/2017 "P-273-a" 90482 "P-442-zn" "P-439-a" 1 16,018.29 04/03/2017 "P-273-b" 90483 "P-442-zo" "P-439-a" 1 16,018.29 04/03/2017 "P-273-c" 90484 "P-442-zp" "P-439-a" 1 16,018.29 04/03/2017 "P-273-d" 90485 "P-442-zq" "P-439-a" 1 16,018.29 04/03/2017 "P-273-e" 90486 "P-442-zr" "P-439-a" 1 16,018.29 04/03/2017 "P-273-f" 90487 "P-442-zs" "P-439-a" 1 16,018.29 04/03/2017 "P-273-g" 90488 "P-442-zt" "P-439-a" 1 16,237.71 04/03/2017 "P-273-h" 90489 "P-442-zu" "P-439-a" 1 16,237.71 04/03/2017 "P-273-i" 90490 "P-442-zv" "P-439-a" 1 16,237.71 04/10/2017 "P-273-j" 90495 "P-442-zw" "P-439-a" 1 16,091.43 04/03/2017 "P-274-a" 90573 "P-442-zy" "P-439-a" 3 541,158.32 06/10/2017 "P-277-a" 91956 "P-442-aaq" "P-439-d" 1 1,138,888.71 04/21/2017 "P-279-a" 90960 "P-442-aax" "P-439-b" 8 359.18 07/14/2017 "P-279-h" 92661 "P-442-abe" "P-439-e" 3 3,201.40 04/03/2017 "P-280-a" 90574 "P-442-abf" "P-439-a" 3 741,128.93 04/03/2017 "P-280-b" 90575 "P-442-abg" "P-439-a" 3 744,932.35 04/13/2017 "P-290-a" 90686 "P-442-acd" "P-439-b" 2 45,414.26 04/13/2017 "P-290-b" 90687 "P-442-ace" "P-439-b" 2 238,419.69 04/13/2017 "P-290-c" 90688 "P-442-acf" "P-439-b" 2 1,621,352.83 04/13/2017 "P-290-d" 90689 "P-442-acg" "P-439-b" 2 1,635,726.11 04/09/2017 "P-291-c" 90662 "P-442-acp" "P-439-a" 5 6,698,066.62 05/16/2017 "P-294-a" 91364 "P-442-adc" "P-439-c" 3 3,592,935.40 07/20/2017 "P-294-b" 92702 "P-442-add" "P-439-e" 4 655,969.33 04/13/2017 "P-295-a" 90679 "P-442-ade" "P-439-a" 5 1,555,325.59 07/22/2017 "P-296-a" 92707 "P-442-adg" "P-439-e" 4 11,779.15 07/26/2017 "P-296-b" 92826 "P-442-adh" "P-439-e" 8 11,779.15 07/29/2017 "P-296-c" 92839 "P-442-adi" "P-439-e" 8 11,779.15 08/02/2017 "P-296-d" 92978 "P-442-adj" "P-439-e" 10 11,779.15 08/05/2017 "P-296-e" 92990 "P-442-adk" "P-439-e" 10 11,779.15 06/05/2017 "P-339-a" 91836 "P-442-ann" "P-439-c" 13 9,110,464.41 06/30/2017 "P-354-a" 92280 "P-442-aua" "P-439-d" 9 325,651.63 05/17/2017 "P-360-a" 91426 "P-442-auh" "P-439-c" 4 330.75 03/03/2018 "P-363-a" 96995 "P-442-avd" "P-439-l" 3 2,680,250.86 01/26/2018 "P-367-c" 96267 "P-442-avt" "P-439-k" 1 14,276.71 08/16/2017 "P-388-a" 93271 "P-442-ayl" "P-439-f" 2 11,897.26 08/19/2017 "P-388-b" 93294 "P-442-aym" "P-439-f" 2 14,276.71 08/23/2017 "P-388-c" 93439 "P-442-ayn" "P-439-f" 5 14,276.71 08/26/2017 "P-388-d" 93462 "P-442-ayo" "P-439-f" 6 16,656.16 08/30/2017 "P-388-e" 93643 "P-442-ayp" "P-439-f" 10 14,276.71 09/02/2017 "P-388-f" 93655 "P-442-ayq" "P-439-f" 10 16,656.16 09/06/2017 "P-388-g" 93678 "P-442-ayr" "P-439-f" 11 14,276.71 02/28/2018 "P-391-a" 96902 "P-442-ays" "P-439-l" 2 14,479.26 03/07/2018 "P-391-b" 97048 "P-442-ayt" "P-439-l" 4 14,479.26 03/09/2018 "P-391-c" 97049 "P-442-ayu" "P-439-l" 4 14,479.26 05/08/2017 "P-396-a" 82970 "P-442-ayx" "P-439-p" 8 2,213,807.83 05/09/2017 "P-396-b" 82968 "P-442-ayy" "P-439-p" 8 1,573,056.25 04/17/2017 "P-398-a" 82714 "P-442-azd" "P-439-p" 2 1,295,913.12 05/02/2017 "P-398-b" 82892 "P-442-aze" "P-439-p" 6 2,518,100.33 12/18/2017 "P-399-a" 85435 "P-442-azf" "P-439-x" 4 45,910.50 12/18/2017 "P-399-b" 85436 "P-442-azg" "P-439-x" 4 189,043.25 05/16/2017 "P-400-a" 83053 "P-442-azh" "P-439-q" 2 6,286,014.07 06/02/2017 "P-400-b" 83252 "P-442-azi" "P-439-q" 6 1,496,068.69 06/15/2017 "P-400-c" 83412 "P-442-azj" "P-439-r" 3 5,383,441.32 02/24/2018 "P-400-d" 86154 "P-442-azk" "P-439-z" 5 1,234,752.00 03/22/2018 "P-400-f" 86431 "P-442-azm" "P-439-aa" 9 1,694,576.78 10/17/2017 "P-406-a" 84751 "P-442-azr" "P-439-v" 2 1,010,417.92 02/12/2018 "P-406-b" 86020 "P-442-azs" "P-439-y" 10 658,376.64 03/21/2018 "P-406-c" 86413 "P-442-azt" "P-439-aa" 8 1,081,227.90 04/25/2017 "P-409-a" 82822 "P-442-azu" "P-439-p" 4 361,247.04 05/16/2017 "P-409-b" 83048 "P-442-azv" "P-439-q" 2 2,453.91 05/16/2017 "P-409-c" 83048 "P-442-azw" "P-439-q" 2 29,407.07 04/24/2017 "P-411-a" 82810 "P-442-bab" "P-439-p" 4 78,525.04 04/24/2017 "P-411-b" 82811 "P-442-bac" "P-439-p" 4 240,831.36 07/11/2017 "P-411-h" 83686 "P-442-bai" "P-439-s" 3 263,457.25 08/02/2017 "P-411-k" 83918 "P-442-bal" "P-439-s" 11 178,588.14 11/23/2017 "P-411-n" 85181 "P-442-bao" "P-439-w" 7 537,765.18 12/07/2017 "P-411-o" 85333 "P-442-bap" "P-439-w" 12 226,851.90 03/26/2018 "P-411-s" 86491 "P-442-bat" "P-439-aa" 10 11,221.59 03/26/2018 "P-411-t" 86491 "P-442-bau" "P-439-aa" 10 21,641.64 03/26/2018 "P-411-u" 86491 "P-442-bav" "P-439-aa" 10 351,877.11 04/12/2017 "P-412-a" 82669 "P-442-baw" "P-439-p" 1 289,797.60 08/10/2017 "P-412-b" 84014 "P-442-bax" "P-439-t" 1 31,749.23 11/22/2017 "P-412-d" 85172 "P-442-baz" "P-439-w" 7 369,034.44 12/06/2017 "P-412-e" 85326 "P-442-bba" "P-439-w" 11 462,125.14 01/09/2018 "P-415-a" 85671 "P-442-bbc" "P-439-x" 11 665,188.16 07/14/2017 "P-416-a" 83725 "P-442-bbd" "P-439-s" 4 152,396.29 02/13/2018 "P-419-a" 86038 "P-442-bbh" "P-439-y" 12 430,032.02 09/07/2017 "P-429-a" 84323 "P-442-bbp" "P-439-t" 12 554,492.57 Subtotal P118,336,107.81 3. Export sales supported by a bill of lading without the date of shipment Date Invoice BL/Airway Bill Proof of Inward Remittance Amount Exhibit Invoice No. Exhibit Exhibit Page No. 07/02/2017 "P-325-i" 92398 "P-442-agp" "P-439-d" 11 P1,287,802.80 Subtotal P1,287,802.80 4. Export sales not supported by a bill of lading and/or proof of inward remittance Date Invoice BL/Airway Bill Proof of Inward Remittance Amount Exhibit Invoice No. Exhibit Exhibit Page No. 04/01/2017 "P-175-a" 90365 - "P-439-a" 1 P13,695.85 04/12/2017 "P-175-b" 90672 - "P-439-a" 5 13,695.85 04/15/2017 "P-175-c" 90698 - "P-439-b" 2 15,978.49 05/11/2017 "P-192-a" 91237 - "P-439-b" 14 343,744.65 05/24/2017 "P-194-a" 91517 - "P-439-c" 6 16,178.60 06/15/2017 "P-199-a" 91982 - "P-439-d" 3 1,778,109.76 08/23/2017 "P-220-a" 93486 - "P-439-f" 7 1,363,023.76 02/02/2018 "P-228-a" 96399 - "P-439-k" 5 14,276.71 01/31/2018 "P-230-a" 96398 - "P-439-k" 5 16,656.16 02/07/2018 "P-230-b" 96517 - "P-439-k" 8 16,656.16 02/09/2018 "P-230-c" 96518 - "P-439-k" 8 14,276.71 02/14/2018 "P-230-d" 96619 - "P-439-k" 9 16,656.16 02/16/2018 "P-230-e" 96620 - "P-439-k" 9 14,276.71 02/23/2018 "P-230-f" 96755 - "P-439-k" 11 14,276.71 05/06/2017 "P-281-a" 91193 - "P-439-b" 13 570,296.75 05/09/2017 "P-281-b" 91264 - "P-439-b" 14 570,296.75 05/09/2017 "P-281-c" 91265 - "P-439-b" 14 359.18 05/24/2017 "P-281-d" 91572 - "P-439-c" 7 445,766.11 06/05/2017 "P-281-e" 91959 - "P-439-d" 1 688.32 07/03/2017 "P-281-f" 92430 - "P-439-d" 12 754,586.62 08/11/2017 "P-281-g" 93296 - "P-439-f" 2 368.52 08/16/2017 "P-281-h" 93366 - "P-439-f" 4 340.88 12/08/2017 "P-281-i" 95417 - "P-439-i" 12 362.52 02/03/2018 "P-281-j" 96471 - "P-439-k" 7 111,882.40 03/20/2018 "P-281-k" 97474 - "P-439-l" 12 4,377.59 03/20/2018 "P-281-l" 97475 - "P-439-l" 12 4,153.50 03/12/2018 "P-288-a" 97274 - - - 710,951.47 03/12/2018 "P-288-b" 97276 - - - 642,390.11 01/11/2018 "P-316-a" 96043 - "P-439-j" 14 636,182.04 03/23/2018 "P-334-d" 97506 - "P-439-m" 2 10,198,161.08 05/28/2017 "P-368-a" 91656 - "P-439-c" 9 343,701.98 05/31/2017 "P-368-b" 91663 - "P-439-c" 9 16,178.60 06/01/2017 "P-368-c" 91680 - "P-439-c" 9 828,105.56 06/03/2017 "P-368-d" 91695 - "P-439-c" 10 16,178.60 06/06/2017 "P-368-e" 91840 - "P-439-c" 13 343,701.98 06/10/2017 "P-368-f" 91867 - "P-439-c" 14 18,489.82 06/14/2017 "P-368-g" 91980 - "P-439-d" 3 18,489.82 06/17/2017 "P-368-h" 91983 - "P-439-d" 3 18,489.82 06/29/2017 "P-368-i" 92267 - "P-439-d" 9 844,086.11 07/01/2017 "P-368-j" 92282 - "P-439-d" 9 16,490.81 07/05/2017 "P-368-k" 92409 - "P-439-d" 12 16,490.81 06/16/2017 "P-368-l" 92512 - "P-439-d" 14 63,951.78 07/15/2017 "P-369-a" 92662 - "P-439-e" 3 585,585.67 03/12/2018 "P-375-a" 97275 - - - 644,029.62 03/28/2018 "P-386-a" 97561 - "P-439-m" 3 13,887.64 03/30/2018 "P-386-b" 97562 - "P-439-m" 3 13,887.64 09/08/2017 "P-389-a" 93679 - "P-439-f" 11 16,656.16 04/26/2017 "P-390-a" 90933 - "P-439-b" 7 16,180.61 05/03/2017 "P-390-b" 91064 - "P-439-b" 9 16,180.61 05/06/2017 "P-390-c" 91087 - "P-439-b" 10 16,180.61 05/10/2017 "P-390-d" 91224 - "P-439-b" 14 16,180.61 05/13/2017 "P-390-e" 91242 - "P-439-b" 14 16,180.61 05/17/2017 "P-390-f" 91365 - "P-439-c" 3 16,180.61 05/20/2017 "P-390-g" 91378 - "P-439-c" 3 16,180.61 01/17/2018 "P-394-a" 96146 - "P-439-j" 16 273,548.59 01/17/2018 "P-394-b" 96167 - "P-439-j" 7 335.88 10/04/2016 "P-401-a" 80605 - - - 806,944.24 11/15/2017 "P-407-a" 85064 - "P-439-w" 2 851,926.40 06/12/2017 "P-408-a" 83363 - - - 18,187.74 03/24/2018 "P-420-a" - - - - 71,288,825.75 03/12/2018 "P-282-a" 97268 "P-442-abq" - - 881,208.35 03/12/2018 "P-282-b" 97270 "P-442-abr" - - 890,426.30 03/12/2018 "P-282-c" 97271 "P-442-abs" - - 652,135.45 03/12/2018 "P-283-a" 97256 "P-442-abt" - - 766,588.52 03/12/2018 "P-283-b" 97258 "P-442-abu" - - 766,588.52 03/12/2018 "P-283-c" 97259 "P-442-abv" - - 766,588.52 03/12/2018 "P-284-a" 97273 "P-442-abw" - - 759,219.58 03/12/2018 "P-285-a" 97261 "P-442-abx" - - 1,361,137.85 03/12/2018 "P-285-b" 97262 "P-442-aby" - - 1,125,080.62 03/12/2018 "P-286-a" 97264 "P-442-abz" - - 745,415.59 03/12/2018 "P-287-a" 97265 "P-442-aca" - - 745,415.59 03/12/2018 "P-287-b" 97267 "P-442-acb" - - 608,834.86 04/16/2017 "P-290-e" 90780 "P-442-ach" - - 644,956.65 02/16/2018 "P-297-a" 96723 "P-442-adl" - - 9,936,424.88 03/12/2018 "P-370-a" 97257 "P-442-avu" - - 766,588.52 03/12/2018 "P-371-a" 97272 "P-442-avv" - - 759,219.58 03/12/2018 "P-372-a" 97263 "P-442-avw" - - 1,436,935.25 03/12/2018 "P-373-a" 97260 "P-442-avx" - - 5,720,047.57 03/12/2018 "P-374-a" 97266 "P-442-avy" - - 745,415.59 03/12/2018 "P-374-b" 97269 "P-442-avz" - - 798,997.26 12/13/2017 "P-403-a" 85406 "P-442-azo" - - 280,679.03 07/14/2017 "P-411-j" 83719 "P-442-bak" - - 22,054.18 Subtotal P126,654,059.57 5. Export sales supported by blurred sales invoices/sales invoices with incomplete or missing page(s) Date Invoice BL/Airway Bill Proof of Inward Remittance Amount Exhibit Invoice No. Exhibit Exhibit Page No. 05/05/2017 "P-187-d" 91085 "P-442-ao" "P-439-b" 10 P414,104.18 12/26/2017 "P-214-r" 95788 "P-442-gb" "P-439-j" 7 1,815,073.58 12/26/2017 "P-214-t" 95790 "P-442-gd" "P-439-j" 7 154,945.31 02/14/2018 "P-225-l" 96618 "P-442-gy" "P-439-k" 9 1,601,244.98 12/27/2017 "P-248-y" 95793 "P-442-pw" "P-439-j" 7 1,211,703.26 08/10/2017 "P-250-c" 93176 "P-442-sl" "P-439-e" 13 1,878,391.53 12/27/2017 "P-250-e" 95791 "P-442-sn" "P-439-j" 7 9,067,819.11 12/27/2017 "P-250-f" 95792 "P-442-so" "P-439-j" 7 20,358,038.96 04/13/2017 "P-255-b" 90756 "P-442-vs" "P-439-b" 3 2,099,072.58 12/27/2017 "P-256-a" 95794 "P-442-xy" "P-439-j" 7 740,759.90 12/27/2017 "P-256-b" 95795 "P-442-xz" "P-439-j" 7 740,759.90 12/27/2017 "P-274-d" 95796 "P-442-aab" "P-439-j" 7 435,741.12 02/16/2018 "P-301-a" 96716 "P-442-adx" "P-439-k" 11 2,759,795.51 12/20/2017 "P-321-b" 95674 "P-442-aga" "P-439-j" 5 29,727,076.22 03/30/2018 "P-325-as" 97594 "P-442-ahz" "P-439-m" 4 3,012,231.46 03/3/2018 "P-340-au" 97008 "P-442-app" "P-439-l" 3 670,427.51 03/30/2018 "P-346-k" 97604 "P-442-asw" "P-439-m" 4 24,091,660.49 03/9/2018 "P-351-g" 97166 "P-442-atp" "P-439-l" 6 1,320,780.66 03/3/2018 "P-362-o" 97007 "P-442-ava" "P-439-l" 3 828,823.22 03/23/2018 "P-380-f" 97537 "P-442-awu" "P-439-m" 2 4,325,064.63 Subtotal P107,253,514.12 6. Export sales with different amounts per sales invoice Date Invoice BL/Airway Bill Proof of Inward Remittance Amount Exhibit Invoice No. Exhibit Exhibit Page No. 08/14/2017 "P-423-a" 84044 "P-442-bbj" "P-439-t" 2 P2,961,184.49 03/01/2018 "P-424-a" 86186 "P-442-bbk" "P-439-z" 6 545,051.97 04/08/2017 "P-426-a" 82646 "P-442-bbm" "P-439-p" 1 5,486,386.45 Subtotal P8,992,622.92 7. Export sales supported by a bill of lading with corrections but not countersigned Date Invoice BL/Airway Bill Proof of Inward Remittance Amount Exhibit Invoice No. Exhibit Exhibit Page No. 11/22/2017 "P-412-c" 85157 "P-442-bay" "P-439-w" 6 P2,883,956.21 Subtotal P2,883,956.21 8. Export sales dated outside the period of the claim Date Invoice BL/Airway Bill Proof of Inward Remittance Amount Exhibit No. Invoice No. Exhibit Exhibit No. Page No. 04/02/2018 "P-421-a" 86552 - - - P319,506.84 04/02/2018 "P-421-b" 86553 - - - 150,189.10 04/02/2018 "P-421-c" 86562 - - - 56,968.28 04/02/2018 "P-421-d" 86572 - - - 207,950.92 04/02/2018 P-421-e" 86573 - - - 36,252.54 Subtotal P770,867.68 9. Export sales without supporting documents Date Invoice BL/Airway Bill Proof of Inward Remittance Amount Exhibit Invoice No. Exhibit Exhibit Page No. 03/21/2017 "P-222" - - - - P234,400,539.84 03/25/2017 "P-223" - - - - 261,692,674.60 07/15/2017 "P-376" - - - - 9,000.91 07/15/2017 "P-377" - - - - 1,582,000.66 07/15/2017 "P-377" - - - - 3,921.29 06/17/2017 "P-378" - - - - 1,175,756,828.58 03/24/2018 "P-387" - - - - 21,771,562.13 04/11/2017 to 02/08/2018 "P-430" 77,587,326.60 03/20/2018 "P-432" - - - - 25,400,026.92 - "P-433" - - - - 20,701,788.93 Subtotal P1,818,905,670.46 Total Additional Disallowances P2,232,314,333.05 In sum, only the total amount of P31,382,276,647.33 satisfied the essential elements to qualify as VAT zero-rated sales under Section 106 (A) (2) (a) (1) of the NIRC of 1997, as amended, computed as follows: AcICHD Amount Export Sales to DAH P33,615,800,744.79 135 Less: Disallowances Disallowances sustained by the Court P1,209,764.41 Disallowances per Court's further verification 2,232,314,333.05 2,233,524,097.46 Total Valid Export Sales P31,382,276,647.33 Considered Export Sales to BOI, PEZA, SBMA, and CDC-registered entities. Petitioner claims that it also derived its zero-rated sales to export-oriented entities registered with the BOI, SBMA, PEZA, and CDC, in the aggregate amount of P49,278,029.47, broken down as follows: Customer BOI/SBMA/CDC Registered Amount Century Pacific Agricultural Ventures, Inc. BOI P40,744,193.57 General Tuna Corporation BOI 2,920,155.24 General Tuna Corporation BOI 115,280.00 Hi-Las Marketing Corporation BOI 46,134.01 Philbest Canning Corporation BOI 2,065,000.00 Amley Food Corporation BOI 17,800.00 Gem Foods International, Inc. SBMA 1,277,796.65 Millbrae Exports, Inc. CDC 2,091,670.00 Total Zero-rated Sales to Export Oriented Entities P49,278,029.47 To recall, respondent imputed additional output VAT in the amount of P5,918,954.44 against petitioner and deducted the same from petitioner's input VAT refund claim. 136 The amount of P5,918,954.44 can be traced from petitioner's claimed zero-rated sales to export-oriented entities registered with the BOI, SBMA, PEZA, and CDC of P49,278,029.47. caITAC Under Section 106 (A) (2) (a) (5) of the NIRC of 1997, as amended, and as implemented by Section 4.106-5 of RR No. 16-2005, as amended by RR No. 4-2007, for a "considered export sale" to qualify as zero-rated, the following essential elements must be present: 1. The sale was made by a VAT-registered person; and, 2. There was a sale of goods or services to an entity entitled to incentives under Executive Order No. 226, otherwise known as the Omnibus Investment Code of 1987 ("OIC"), and other special laws. As for the first essential element, it is already settled that petitioner is a VAT-registered person. As for the second essential element, any VAT-registered person claiming VAT zero-rated "considered export sales" must present, among others, the following documents: 1. The sales invoice as proof of sale of goods; and 2. The proof of entitlement to zero-rating under the OIC or other special laws. As for the first type of document, petitioner presented the sales invoices 137 in support of its alleged "considered export sales" to the following customers: Customer Name Amount Exhibits Sale of goods to BOI-registered entities Century Pacific Agricultural Ventures, Inc. P40,744,193.57 "P-157.1"; "P-158"; "P-159" General Tuna Corporation 2,920,155.24 "P-157.1" General Tuna Corporation 115,280.00 Philbest Canning Corporation 2,065,000.00 "P-157.2"; "P-159" Amley Food Corporation 17,800.00 "P-157.2" Sale of goods to PEZA-registered entity Hi-Las Marketing Corporation 46,134.01 No supporting documents 138 Sale of goods to SBMA-registered entity Gem Foods International, Inc. 1,277,796.65 "P-160" to "P-161" Sale of goods to CDC-registered entity Millbrae Exports, Inc. 2,091,670.00 "P-162" Total Zero-rated Sales to Export Oriented Entities P49,278,029.47 However, after careful examination of the sales invoices presented, the Court finds that only the "considered export sales" to Millbrae Exports, Inc. and Amley Foods Corporation in the amounts of P2,091,670.00 and P17,800.00, respectively, are duly supported by invoices and may be accorded VAT zero-rating. In contrast, the remaining portion of P47,168,559.47 must be disallowed outright for failure to comply with the invoicing requirements under the NIRC of 1997, as amended, and RR No. 16-2005, as amended, to wit: TAIaHE DATE EXHIBIT REF. INVOICE NO. AMOUNT 1. TIN OF THE PURCHASER NOT INDICATED IN THE INVOICE ISSUED BY PETITIONER A. CENTURY PACIFIC AGRICULTURAL VENTURES, INC. 04/03/2017 "P-157.1-a" 8671 P14,000.91 04/03/2017 "P-157.1-b" 8672 80,761.59 04/05/2017 "P-157.1-c" 8673 378,336.00 04/06/2017 "P-157.1-d" 8670 37,230.00 04/06/2017 "P-157.1-e" 8674 104,181.75 04/06/2017 "P-157.1-f" 8677 18,377.59 04/06/2017 "P-157.1-g" 8678 19,739.72 04/06/2017 "P-157.1-h" 8679 438,865.20 04/06/2017 "P-157.1-i" 8680 77,880.00 04/10/2017 "P-157.1-j" 8695 172,368.00 04/10/2017 "P-157.1-k" 8696 102,600.00 04/10/2017 "P-157.1-l" 8697 22,374.66 04/10/2017 "P-157.1-m" 8698 289,668.00 04/11/2017 "P-157.1-n" 8700 275,788.80 04/11/2017 "P-157.1-o" 8701 230,100.00 04/11/2017 "P-157.1-p" 8702 115,809.75 04/11/2017 "P-157.1-q" 8703 20,431.95 04/17/2017 "P-157.1-r" 8705 3,595.13 04/21/2017 "P-157.1-s" 8709 77,341.00 04/21/2017 "P-157.1-t" 8710 81,420.00 04/21/2017 "P-157.1-u" 8711 9,244.62 04/26/2017 "P-157.1-w" 8720 42,480.00 04/26/2017 "P-157.1-x" 8721 8,485.40 04/26/2017 "P-157.1-y" 8722 80,402.49 04/26/2017 "P-157.1-z" 8732 247,608.00 05/11/2017 "P-157.1-ab" 8741 86,184.00 05/11/2017 "P-157.1-ac" 8746 5,144.80 05/11/2017 "P-157.1-ad" 8747 45,600.00 05/11/2017 "P-157.1-ae" 8748 7,750.00 05/11/2017 "P-157.1-af" 8749 172,368.00 05/12/2017 "P-157.1-ag" 8761 274,352.40 05/12/2017 "P-157.1-ah" 8762 81,608.25 05/15/2017 "P-157.1-ai" 8753 88,446.33 05/15/2017 "P-157.1-aj" 8754 189,604.80 05/15/2017 "P-157.1-ak" 8755 130,496.94 05/15/2017 "P-157.1-al" 8756 67,266.00 05/15/2017 "P-157.1-am" 8757 76,344.66 05/16/2017 "P-157.1-an" 8765 26,338.80 05/16/2017 "P-157.1-ao" 8766 15,513.60 05/16/2017 "P-157.1-ap" 8767 202,532.40 05/17/2017 "P-157.1-aq" 8771 184,830.00 05/17/2017 "P-157.1-ar" 8772 75,913.74 05/18/2017 "P-157.1-as" 8773 65,419.20 05/18/2017 "P-157.1-at" 8774 224,078.40 05/18/2017 "P-157.1-au" 8775 8,696.60 05/22/2017 "P-157.1-av" 8781 140,100.00 05/22/2017 "P-157.1-aw" 8782 189,604.80 05/22/2017 "P-157.1-ax" 8783 48,370.77 05/23/2017 "P-157.1-ay" 8784 296,358.24 05/23/2017 "P-157.1-az" 8785 61,872.60 05/23/2017 "P-157.1-ba" 8786 72,974.52 05/23/2017 "P-157.1-bb" 8787 30,164.40 05/23/2017 "P-157.1-bc" 8788 112,003.29 05/23/2017 "P-157.1-bd" 8789 68,947.20 05/24/2017 "P-157.1-be" 8790 241,315.20 05/24/2017 "P-157.1-bf 8791 34,473.60 05/24/2017 "P-157.1-bg" 8792 86,184.00 05/24/2017 "P-157.1-bh" 8793 106,200.00 05/24/2017 "P-157.1-bi" 8794 12,480.00 05/24/2017 "P-157.1-bj" 8795 92,160.00 05/25/2017 "P-157.1-bk" 8796 115,522.00 05/25/2017 "P-157.1-bl" 8797 5,664.00 05/25/2017 "P-157.1-bm" 8798 35,191.80 05/25/2017 "P-157.1-bn" 8799 101,856.00 05/30/2017 "P-157.1-bo" 8807 210,888.00 05/30/2017 "P-157.1-bp" 8808 121,684.80 06/01/2017 "P-157.1-bq" 8812 242,400.00 06/01/2017 "P-157.1-br" 8813 84,960.00 06/02/2017 "P-157.1-bs" 8818 103,953.24 06/02/2017 "P-157.1-bt" 8819 1,030.75 06/02/2017 "P-157.1-bu" 8820 259,889.16 06/02/2017 "P-157.1-bv" 8821 46,507.25 06/05/2017 "P-157.1-bw" 8826 37,440.00 06/05/2017 "P-157.1-bx" 8827 209,355.30 06/06/2017 "P-157.1-by" 8830 305,908.80 06/13/2017 "P-157.1-bz" 8841 37,280.32 06/14/2017 "P-157.1-ca" 8842 157,742.75 06/14/2017 "P-157.1-cb" 8843 42,042.25 06/14/2017 "P-157.1-cc" 8844 101,500.00 06/15/2017 "P-157.1-ce" 8849 313,984.88 06/15/2017 "P-157.1-cf" 8850 41,627.08 07/17/2017 "P-157.1-cg" 8948 189,254.00 07/21/2017 "P-157.1-ci" 8951 60,300.00 07/21/2017 "P-157.1-cj" 8952 127,440.00 07/21/2017 "P-157.1-ck" 8953 1,216.00 07/21/2017 "P-157.1-cl" 8954 113,280.00 07/21/2017 "P-157.1-cm" 8955 38,798.00 07/21/2017 "P-157.1-cn" 8956 6,832.98 07/24/2017 "P-157.1-co" 8957 7,592.20 07/24/2017 "P-157.1-cp" 8971 337,536.00 08/01/2017 "P-157.1-cq" 8976 169,014.50 08/03/2017 "P-157.1-cr" 13726 49,035.00 08/04/2017 "P-157.1-cs" 13724 107,596.80 08/04/2017 "P-157.1-ct" 13725 56,026.40 08/05/2017 "P-157.1-cu" 13718 59,598.77 08/05/2017 "P-157.1-cv" 13720 47,830.86 08/05/2017 "P-157.1-cw" 13721 2,802.00 08/05/2017 "P-157.1-cx" 13722 28,933.60 08/05/2017 "P-157.1-cy" 13723 44,528.40 08/08/2017 "P-157.1-cz" 13730 30,604.80 08/08/2017 "P-157.1-da" 13731 61,555.20 08/08/2017 "P-157.1-db" 13732 117,480.00 08/08/2017 "P-157.1-dc" 13733 69,326.40 08/09/2017 "P-157.1-dd" 13746 117,480.00 08/09/2017 "P-157.1-de" 13747 167,376.50 08/14/2017 "P-157.1-df" 13769 80,455.50 08/14/2017 "P-157.1-dg" 13770 195,817.23 08/15/2017 "P-157.1-dh" 13767 128,640.00 08/15/2017 "P-157.1-di" 13768 120,175.00 08/15/2017 "P-157.1-dj" 13777 1,789.20 08/15/2017 "P-157.1-dk" 13778 258,552.00 08/15/2017 "P-157.1-dl" 13779 12,780.00 08/15/2017 "P-157.1-dm" 13962 18,268.14 08/16/2017 "P-157.1-dn" 13783 50,220.17 08/16/2017 "P-157.1-do" 13785 119,939.40 08/16/2017 "P-157.1-dp" 13786 1,958.00 08/16/2017 "P-157.1-dq" 13787 50,750.00 08/16/2017 "P-157.1-dr" 13788 1,581.75 08/16/2017 "P-157.1-ds" 13789 66,818.25 08/16/2017 "P-157.1-dt" 13790 363,600.00 08/18/2017 "P-157.1-dv" 13925 63,720.00 08/18/2017 "P-157.1-dw" 13926 197,074.08 08/18/2017 "P-157.1-dx" 13927 37,539.84 08/18/2017 "P-157.1-dy" 13928 32,025.60 08/18/2017 "P-157.1-dz" 13929 152,190.00 08/19/2017 "P-157.1-ea" 13930 275,788.80 08/20/2017 "P-157.1-eb" 13956 68,947.20 08/22/2017 "P-157.1-ec" 13931 275,788.80 08/23/2017 "P-157.1-ed" 13933 40,629.00 08/23/2017 "P-157.1-ee" 13934 77,062.86 08/23/2017 "P-157.1-ef" 13935 157,142.16 08/24/2017 "P-157.1-eg" 13937 51,300.00 08/24/2017 "P-157.1-eh" 13939 90,084.30 08/24/2017 "P-157.1-ei" 13940 172,368.00 08/29/2017 "P-157.1-ej" 13947 271,120.50 08/31/2017 "P-157.1-ek" 13963 277,476.57 09/11/2017 "P-157.1-el" 14104 72,688.00 09/12/2017 "P-157.1-em" 14106 106,200.00 09/12/2017 "P-157.1-en" 14107 57,150.94 09/21/2017 "P-157.1-eq" 14125 58,176.00 09/22/2017 "P-157.1-er" 14126 179,550.00 09/25/2017 "P-157.1-es" 14132 35,910.00 09/25/2017 "P-157.1-et" 14133 233,415.00 09/28/2017 "P-157.1-eu" 14129 273,600.00 09/28/2017 "P-157.1-ev" 14130 68,400.00 09/28/2017 "P-157.1-ew" 14131 215,460.00 10/02/2017 "P-157.1-ex" 14137 193,920.00 10/02/2017 "P-157.1-ey" 14138 143,640.00 10/04/2017 "P-157.1-fd" 14144 5,357.80 10/04/2017 "P-157.1-fe" 14145 233,810.01 10/04/2017 "P-157.1-ff" 14146 31,000.00 10/09/2017 "P-157.1-fg" 14271 170,510.00 10/09/2017 "P-157.1-fh" 14272 160,840.89 10/16/2017 "P-157.1-fi" 14347 56,942.20 10/16/2017 "P-157.1-fj" 14348 50,760.00 10/16/2017 "P-157.1-fk" 14349 5,607.00 10/17/2017 "P-157.1-fl" 14350 41,296.50 10/17/2017 "P-157.1-fm" 14351 177,754.50 10/19/2017 "P-157.1-fn" 14281 175,615.00 10/19/2017 "P-157.1-fo" 14282 234,492.30 10/20/2017 "P-157.1-fp" 14327 107,730.00 10/20/2017 "P-157.1-fq" 14328 51,692.50 10/20/2017 "P-157.1-fr" 14329 90,241.83 10/20/2017 "P-157.1-fs" 14330 112,800.00 10/27/2017 "P-157.1-fu" 14357 94,400.00 10/27/2017 "P-157.1-fv" 14358 39,060.00 10/27/2017 "P-157.1-fw" 14359 329,940.00 10/27/2017 "P-157.1-fx" 14360 72,162.00 10/27/2017 "P-157.1-fy" 14361 38,976.00 10/27/2017 "P-157.1-fz" 14362 144,573.66 10/30/2017 "P-157.1-ga" 14364 10,260.00 10/30/2017 "P-157.1-gb" 14365 19,200.00 10/30/2017 "P-157.1-gc" 14366 233,415.00 11/15/2017 "P-157.1-gd" 14508 121,540.00 11/15/2017 "P-157.1-ge" 14509 189,222.00 11/15/2017 "P-157.1-gf" 14510 203,896.98 11/15/2017 "P-157.1-gg" 14511 128,874.00 11/21/2017 "P-157.1-gh" 14514 27,361.60 11/21/2017 "P-157.1-gi" 14515 90,780.48 11/21/2017 "P-157.1-gj" 14516 175,404.00 11/21/2017 "P-157.1-gk" 14517 109,698.00 11/22/2017 "P-157.1-gl" 14518 287,280.00 11/22/2017 "P-157.1-gm" 14519 35,136.00 11/22/2017 "P-157.1-gn" 14520 187,047.96 11/22/2017 "P-157.1-go" 14521 122,569.56 11/29/2017 "P-157.1-gq" 14528 6,584.70 11/29/2017 "P-157.1-gr" 14529 57,600.00 11/29/2017 "P-157.1-gs" 14530 68,416.40 11/29/2017 "P-157.1-gt" 14531 50,750.00 11/29/2017 "P-157.1-gu" 14532 16,169.00 11/29/2017 "P-157.1-gv" 14533 115,200.00 11/29/2017 "P-157.1-gw" 14534 73,320.00 12/12/2017 "P-157.1-gx" 14681 74,405.52 12/12/2017 "P-157.1-gy" 14682 79,145.64 12/12/2017 "P-157.1-gz" 14683 134,842.05 12/13/2017 "P-157.1-ha" 14684 42,480.00 12/13/2017 "P-157.1-hb" 14685 275,022.00 12/13/2017 "P-157.1-hc" 14686 53,865.00 12/18/2017 "P-157.1-hd" 14696 245,440.00 12/18/2017 "P-157.1-he" 14697 108,342.00 12/20/2017 "P-157.1-hf" 14708 127,440.00 12/20/2017 "P-157.1-hg" 14709 215,460.00 12/22/2017 "P-157.1-hi" 14713 69,043.20 12/22/2017 "P-157.1-hj" 14714 66,541.23 12/22/2017 "P-157.1-hk" 14715 18,124.80 12/22/2017 "P-157.1-hl" 14717 148,918.77 12/26/2017 "P-157.1-hm" 14718 106,752.00 12/26/2017 "P-157.1-hn" 14719 141,305.85 12/26/2017 "P-157.1-ho" 14720 35,324.10 01/03/2018 "P-157.1-hp" 14860 107,730.00 01/03/2018 "P-157.1-hq" 14861 25,452.00 01/03/2018 "P-157.1-hr' 14862 76,800.00 01/03/2018 "P-157.1-hs" 14863 100,992.00 01/03/2018 "P-157.1-ht" 14864 61,360.00 01/03/2018 "P-157.1-hu" 14865 28,200.00 01/03/2018 "P-157.1-hv" 14866 197,505.00 01/04/2018 "P-157.1-hw" 14867 56,400.00 01/04/2018 "P-157.1-hx" 14868 125,685.00 01/04/2018 "P-157.1-hy" 14869 125,685.00 01/04/2018 "P-157.1-hz" 14870 179,550.00 01/04/2018 "P-157.1-ia" 14871 39,834.62 01/04/2018 "P-157.1-ib" 14872 86,052.00 01/11/2018 "P-157.1-ic" 14949 286,274.52 01/12/2018 "P-157.1-ie" 14952 38,782.80 01/12/2018 "P-157.1-if" 14953 51,279.48 01/12/2018 "P-157.1-ig" 14954 72,720.00 01/12/2018 "P-157.1-ih" 14955 125,685.00 01/12/2018 "P-157.1-ii" 14956 288,465.03 01/15/2018 "P-157.1-ij" 14878 3,024.00 01/16/2018 "P-157.1-ik" 14879 639.00 01/16/2018 "P-157.1-il" 14880 3,024.00 01/16/2018 "P-157.1-im" 14881 8,568.00 01/17/2018 "P-157.1-in" 14883 125,685.00 01/17/2018 "P-157.1-io" 14884 42,480.00 01/17/2018 "P-157.1-ip" 14885 3,517.92 01/17/2018 "P-157.1-iq" 14886 69,800.00 01/17/2018 "P-157.1-ir" 14887 31,382.08 01/17/2018 "P-157.1-is" 14888 7,272.00 01/17/2018 "P-157.1-it" 14889 12,600.00 01/17/2018 "P-157.1-iu" 14917 182,600.55 01/18/2018 "P-157.1-iv" 14891 187,620.00 01/18/2018 "P-157.1-iw" 14892 22,680.00 01/18/2018 "P-157.1-ix" 14893 12,210.00 01/18/2018 "P-157.1-iy" 14894 3,968.25 01/18/2018 "P-157.1-iz" 14895 39,234.60 01/19/2018 "P-157.1-ja" 14920 156,959.55 01/19/2018 "P-157.1-jb" 14921 792,929.61 01/19/2018 "P-157.1-jc" 14922 48,636.00 01/22/2018 "P-157.1-jd" 14924 84,960.00 01/22/2018 "P-157.1-je" 14925 134,877.96 01/22/2018 "P-157.1-jf" 14926 14,605.92 01/23/2018 "P-157.1-jg" 14927 3,024.00 01/23/2018 "P-157.1-jh" 14928 6,219.36 01/24/2018 "P-157.1-ji" 14941 10,439.55 01/24/2018 "P-157.1-jj" 14942 154,395.45 01/24/2018 "P-157.1-jk" 14943 9,908.64 01/26/2018 "P-157.1-jl" 14945 14,388.00 01/31/2018 "P-157.1-jm" 14971 209,280.00 01/31/2018 "P-157.1-jn" 14972 861.84 01/31/2018 "P-157.1-jo" 14973 142,778.16 02/01/2018 "P-157.1-jp" 15095 143,640.00 02/01/2018 "P-157.1-jq" 15096 107,730.00 02/01/2018 "P-157.1-jr" 15097 35,910.00 02/02/2018 "P-157.1-js" 15104 79,361.10 02/02/2018 "P-157.1-jt" 15105 91,008.00 02/02/2018 "P-157.1-ju" 15122 84,960.00 02/06/2018 "P-157.1-jv" 15106 61,371.60 02/06/2018 "P-157.1-jw" 15107 30,088.80 02/06/2018 "P-157.1-jx" 15113 186,264.00 02/06/2018 "P-157.1-jy" 15114 53,865.00 02/06/2018 "P-157.1-jz" 15115 175,168.98 02/06/2018 "P-157.1-ka" 15116 42,480.00 02/06/2018 "P-157.1-kb" 15117 31,999.20 02/06/2018 "P-157.1-kc" 15119 161,595.00 02/07/2018 "P-157.1-kd" 15110 53,865.00 02/07/2018 "P-157.1-ke" 15111 71,820.00 02/07/2018 "P-157.1-kf" 15112 44,707.95 02/07/2018 "P-157.1-kg" 15120 20,060.00 02/07/2018 "P-157.1-kh" 15121 154,235.00 02/08/2018 "P-157.1-ki" 15125 89,775.00 02/08/2018 "P-157.1-kj" 15126 229,230.00 02/08/2018 "P-157.1-kk" 15127 183,150.00 02/08/2018 "P-157.1-kl" 15128 236,750.00 02/08/2018 "P-157.1-km" 15129 234,200.00 02/08/2018 "P-157.1-kn" 15130 71,820.00 02/08/2018 "P-157.1-ko" 15131 125,685.00 02/08/2018 "P-157.1-kp" 15132 50,940.00 02/08/2018 "P-157.1-kq" 15133 72,208.75 02/08/2018 "P-157.1-kr" 15134 17,955.00 02/08/2018 "P-157.1-ks" 15135 30,312.26 02/09/2018 "P-157.1-kt" 15136 53,865.00 02/09/2018 "P-157.1-ku" 15137 17,955.00 02/09/2018 "P-157.1-kv" 15138 70,750.00 02/15/2018 "P-157.1-la" 15149 209,541.60 02/15/2018 "P-157.1-lb" 15150 21,168.00 02/17/2018 "P-157.1-le" 15156 861.84 02/17/2018 "P-157.1-lf" 15157 225,882.00 02/17/2018 "P-157.1-lg" 15158 107,730.00 02/17/2018 "P-157.1-lh" 15159 35,048.16 02/21/2018 "P-157.1-lj" 15167 30,164.40 02/21/2018 "P-157.1-lk" 15168 117,174.33 02/21/2018 "P-157.1-ll" 15169 32,015.28 02/21/2018 "P-157.1-lm" 15170 108,600.00 02/21/2018 "P-157.1-ln" 15172 102,866.72 02/26/2018 "P-157.1-lo" 15190 347,520.00 02/26/2018 "P-157.1-lp" 15191 2,009.25 02/26/2018 "P-157.1-lq" 15192 78,714.72 02/26/2018 "P-157.1-lr" 15193 143,640.00 02/26/2018 "P-157.1-ls" 15194 76,454.40 03/03/2018 "P-157.1-lv" 15342 3,528.00 03/06/2018 "P-157.1-lw" 15222 545,164.29 03/06/2018 "P-157.1-lx" 15223 14,590.80 03/09/2018 "P-157.1-ly" 15329 4,955.58 03/09/2018 "P-157.1-lz" 15330 282,324.42 03/09/2018 "P-157.1-ma" 15331 164,620.80 03/09/2018 "P-157.1-mb" 15332 135,272.97 03/09/2018 "P-157.1-mc" 15333 1,582.56 03/12/2018 "P-157.1-md" 15344 28,608.00 03/12/2018 "P-157.1-me" 15345 251,370.00 03/13/2018 "P-157.1-mf" 15350 103,420.80 03/14/2018 "P-157.1-mg" 15351 109,468.80 03/14/2018 "P-157.1-mh" 15352 14,776.32 03/14/2018 "P-157.1-mi" 15353 85,824.90 03/16/2018 "P-157.1-mk" 15361 80,689.77 03/16/2018 "P-157.1-ml" 15362 9,731.61 03/16/2018 "P-157.1-mm" 15363 161,987.76 03/16/2018 "P-157.1-mn" 15364 44,760.00 03/16/2018 "P-157.1-mo" 15365 40,900.00 03/16/2018 "P-157.1-mp" 15366 27,920.00 03/16/2018 "P-157.1-mq" 15367 49,196.70 03/16/2018 "P-157.1-mr" 15368 10,054.80 03/16/2018 "P-157.1-ms" 15369 94,299.66 03/16/2018 "P-157.1-mt" 15370 86,880.00 03/16/2018 "P-157.1-mu" 15371 40,900.00 03/19/2018 "P-157.1-mv" 15387 27,920.00 03/19/2018 "P-157.1-mw" 15388 10,584.00 03/19/2018 "P-157.1-mx" 15389 173,846.88 03/20/2018 "P-157.1-my" 15392 22,347.36 03/21/2018 "P-157.1-mz" 15393 304,080.00 03/21/2018 "P-157.1-na" 15394 203,299.20 03/21/2018 "P-157.1-nb" 15395 75,222.00 03/26/2018 "P-157.1-nc" 15448 37,260.72 03/26/2018 "P-157.1-nd" 15449 71,820.00 03/26/2018 "P-157.1-ne" 15450 283,000.00 03/26/2018 "P-157.1-nf" 15451 25,238.64 03/26/2018 "P-157.1-ng" 15452 173,760.00 03/26/2018 "P-157.1-nh" 15453 144,354.60 05/11/2018 "P-157.1-ni" 8742 32,152.95 05/11/2018 "P-157.1-nj" 8743 143,535.20 05/11/2018 "P-157.1-nk" 8744 602.91 05/11/2018 "P-157.1-nl" 8745 16,640.00 06/06/2018 "P-157.1-nm" 8831 20,160.00 06/06/2018 "P-157.1-nn" 8833 76,704.00 06/08/2018 "P-157.1-no" 8834 339,360.00 06/08/2018 "P-157.1-np" 8835 132,108.00 06/08/2018 "P-157.1-nq" 8836 224,388.80 08/01/2018 "P-157.1-nr" 8977 51,225.02 08/01/2018 "P-157.1-ns" 8978 35,287.75 06/19/2017 "P-158-a" 8861 31,255.95 06/19/2017 "P-158-b" 8862 25,425.90 06/19/2017 "P-158-c" 8863 190,553.20 06/19/2017 "P-158-d" 8864 84,822.31 06/20/2017 "P-158-e" 8865 333,468.09 06/20/2017 "P-158-f" 8866 194,126.07 06/20/2017 "P-158-g" 8867 169,644.62 06/23/2017 "P-158-h" 8872 3,780.28 06/23/2017 "P-158-i" 8873 208,521.01 06/28/2017 "P-158-j" 8877 46,740.87 06/28/2017 "P-158-k" 8879 43,136.32 06/28/2017 "P-158-1" 8881 99,276.16 06/30/2017 "P-158-m" 8887 43,323.92 06/30/2017 "P-158-n" 8889 11,005.71 06/30/2017 "P-158-o" 8890 263,181.80 07/03/2017 "P-158-p" 8894 64,792.34 07/03/2017 "P-158-q" 8895 171,639.94 07/04/2017 "P-158-r" 8892 61,824.85 07/04/2017 "P-158-s" 8896 54,601.89 07/04/2017 "P-158-t" 8897 112,066.82 07/06/2017 "P-158-u" 8902 15,502.74 07/06/2017 "P-158-v" 8903 103,747.44 07/06/2017 "P-158-w" 8904 179,696.97 07/07/2017 "P-158-x" 8905 74,059.64 07/07/2017 "P-158-y" 8907 50,965.16 07/07/2017 "P-158-z" 8908 174,841.57 07/11/2017 "P-158-aa" 8914 84,822.31 07/11/2017 "P-158-ab" 8915 84,115.46 07/11/2017 "P-158-ac" 8916 51,107.22 07/11/2017 "P-158-ad" 8917 26,381.24 07/11/2017 "P-158-ae" 8922 40,403.95 07/12/2017 "P-158-af" 8925 49,638.08 07/12/2017 "P-158-ag" 8926 252,613.66 07/13/2017 "P-158-ah" 8929 26,526.28 07/13/2017 "P-158-ai" 8930 97,763.45 07/13/2017 "P-158-aj" 8931 117,009.34 sub-total P41,235,354.57 B. GENERAL TUNA CORPORATION 05/09/2017 "P-157.1-aa" 8739 P57,640.00 06/14/2017 "P-157.1-cd" 8848 115,280.00 07/17/2017 "P-157.1-ch" 8937 115,280.00 08/17/2017 "P-157.1-du" 13795 115,280.00 09/15/2017 "P-157.1-eo" 14114 50,648.00 09/19/2017 "P-157.1-ep" 14119 374,016.00 10/03/2017 "P-157.1-ez" 14140 364,353.92 10/03/2017 "P-157.1-fa" 14141 42,856.00 10/03/2017 "P-157.1-fb" 14142 103,166.08 10/03/2017 "P-157.1-fc" 14143 273,499.20 10/25/2017 "P-157.1-ft" 14356 327,264.00 11/24/2017 "P-157.1-gp" 14525 42,485.88 12/20/2017 "P-157.1-hh" 14706 29,220.00 01/11/2018 "P-157.1-id" 14950 61,655.76 02/14/2018 "P-157.1-kw" 15148 161,338.50 02/14/2018 "P-157.1-kx" 15151 37,762.20 02/14/2018 "P-157.1-ky" 15152 26,973.00 02/14/2018 "P-157.1-kz" 15153 167,232.60 02/15/2018 "P-157.1-lc" 15154 45,554.40 02/15/2018 "P-157.1-ld" 15155 144,655.20 02/19/2018 "P-157.1-li" 15160 113,046.84 02/26/2018 "P-157.1-lt" 15195 2,737.26 02/26/2018 "P-157.1-lu" 15196 94,126.40 03/14/2018 "P-157.1-mj" 15354 54,084.00 04/21/2017 "P-157.1-v" 8708 115,280.00 sub-total P3,035,435.24 C. PHILBEST CANNING CORP. 05/05/2017 "P-157.2-a" 14079 147,500.00 05/13/2017 "P-157.2-b" 14080 147,500.00 06/30/2017 "P-157.2-c" 14081 147,500.00 08/30/2017 "P-157.2-d" 14084 147,500.00 09/15/2017 "P-157.2-e" 14085 147,500.00 09/26/2017 "P-157.2-f" 14148 147,500.00 10/13/2017 "P-157.2-h" 15336 147,500.00 11/20/2017 "P-157.2-i" 15337 147,500.00 11/20/2017 "P-157.2-j" 15339 147,500.00 11/21/2017 "P-157.2-k" 15338 147,500.00 02/24/2018 "P-157.2-l" 15340 147,500.00 sub-total P1,622,500.00 D. GEM FOODS INTERNATIONAL, INC. 05/23/2017 "P-160-a" 13334 64,795.93 07/10/2017 "P-160-b" 13578 100,322.34 08/23/2017 "P-160-c" 13924 437,038.84 09/07/2017 "P-160-d" 13960 221,178.12 09/07/2017 "P-160-e" 13961 6,613.34 09/15/2017 "P-160-f" 14086 2,939.26 09/22/2017 "P-160-g 14087 20,192.39 09/22/2017 "P-160-h" 14088 4,408.89 sub-total P857,489.10 TOTAL P46,750,778.91 2. PURPORTED INVOICES WERE NOT FORMALLY OFFERED A. CENTURY PACIFIC AGRICULTURAL VENTURES, INC. (Annex P-159 of Exhibit P-77) 05/17/2017 17020306 P293,220.00 05/29/2017 8805 23,131.80 05/29/2017 8806 223,719.30 06/28/2017 8878 126,522.65 07/13/2017 8927 216,170.66 01/16/2018 8064630 (383,351.12) 01/24/2018 14944 285,621.36 01/24/2018 8071584 (22,681.35) 02/08/2018 8078176 (183,141.00) 03/06/2018 8089360 (48,638.91) 03/06/2018 8089361 (1,024,955.14) 03/07/2018 15224 3,220.75 sub-total P(491,161.00) B. PHILBEST CANNING CORP. (Annex P-159 of Exhibit P-77) 04/22/2017 13160 147,500.00 07/18/2017 7992631 147,500.00 07/26/2017 7995354 147,500.00 sub-total P442,500.00 C. GEM FOODS INTERNATIONAL, INC. (Annex P-161 of Exhibit P-77) 05/01/2017 13214 37,880.93 07/31/2017 7997261 14,769.42 07/31/2017 7997262 85.98 07/31/2017 7997263 687.82 07/31/2017 7997264 63,303.72 08/08/2017 8000810 2,023.00 10/05/2017 14147 144,184.13 10/25/2017 14331 2,939.27 11/20/2017 14490 5,143.71 01/30/2018 14959 97,914.16 01/30/2018 14960 2,939.26 02/09/2018 15139 44,762.07 02/15/2018 15140 3,674.08 sub-total P420,307.55 D. HI-LAS MARKETING CORPORATION (Annex P-163 of Exhibit P-77) 08/09/2017 8001057 P18,411.83 08/09/2017 8001058 2,985.95 08/09/2017 8001059 5,310.38 08/09/2017 8001060 19,425.86 sub-total 46,134.01 TOTAL 417,780.56 Grand Total P47,168,559.47 As to the second essential element, to prove that its customers, Milbrae Exports, Inc. and Amley Foods Corporation, are duly registered with the BOI and CDC, respectively, petitioner submitted the Certifications issued by the respective agencies, to wit: ICHDca Customer Name Proof of VAT Zero-rating Certification Period Exhibit No. % of Export Sales Amley Food Corporation BOI Certification was issued on February 27, 2017 January 1 to December 31, 2017 "P-77-C" 139 /"P-443-a" 93.48% for the period January 1 to December 31, 2016 Millbrae Exports, Inc. CDC Certificate of Registration and Tax Exemption March 1, 2016 to April 30, 2018 "P-445-b" Upon examination, We find that the sales made to Millbrae Exports, Inc. in the amount of P2,091,670.00 are indeed zero-rated export sales based on the certification issued by the CDC on February 17, 2016. With regard to sales to Amley Food Corporation, We cannot consider the same subject to VAT zero-rating. cDHAES In Commissioner of Internal Revenue vs. Filminera Resources Corporation (Filminera case) , 140 the Supreme Court ruled that sales made to a BOI-registered buyer are export sales subject to the zero percent rate if the following conditions are met: 1. The buyer is a BOI-registered manufacturer/producer; 2. The buyer's products are 100% exported; and 3. The BOI certifies that the buyer exported 100% of its products. For this purpose, the BOI Certification is vital for the seller-taxpayer to avail of zero-rating benefits. The certification is evidence that the buyer exported its entire products and shall serve as authority for the seller to claim for refund or tax credit. Relative thereto, petitioner must present the following documents: 1. The buyer's Certificate of Registration with the BOI; and, 2. The BOI Certification that the buyer exported 100% of its products. A cursory examination of the BOI Certification issued to Amley Food Corporation shows that petitioner fell short in proving that Amley Food Corporation's products for the period subject of the present claim, i.e. , from April 1, 2017 to March 31, 2018 , are 100% exported . To emphasize, the BOI's records show that Amley Food Corporation has exported 93.48% of its sales value from January 1 to December 31, 2016 . Thus, petitioner's sales of P17,800.00 cannot qualify for a VAT zero rating. In sum, petitioner's valid zero-rated sales for the period covering April 1, 2017 to March 31, 2018 amounted to P31,384,368,317.33 , as determined below: Export Sales to DAH Considered Export Sales Total Reported Zero-Rated Sales (based on the amended Quarterly VAT Returns) P33,615,917,839.03 P49,278,029.47 P33,665,195,868.50 Less: Adjustments - Unsupported Zero-Rated Sales (117,094.24) (117,094,24) Disallowances sustained by the Court for failure to establish compliance with the essential elements to qualify for VAT zero-rating (1,209,764.41) Disallowances per Court's further verification for failure to establish compliance with the essential elements to qualify for VAT zero-rating (2,232,314,333.05) (47,186,359.47) 141 (2,280,710,456.93) Valid zero-rated sales P31,382,276,647.33 P2,091,670.00 P31,384,368,317.33 Sixth requisite: The input VAT claimed by petitioner are not transitional input taxes . The input taxes are not transitional, as understood under Section 111 (A) of the NIRC of 1997, as amended, to wit: TCAScE "SEC. 111. Transitional/Presumptive Input Tax Credits . (A) Transitional Input Tax Credits . A person who becomes liable to value-added tax or any person who elects to be a VAT-registered person shall, subject to the filing of an inventory according to rules and regulations prescribed by the Secretary of Finance, upon recommendation of the Commissioner, be allowed input tax on his beginning inventory of goods, materials and supplies equivalent to two percent (2%) of the value of such inventory or the actual value-added tax paid on such goods, materials and supplies, whichever is higher, which shall be creditable against the output tax." As held by the Supreme Court in Fort Bonifacio Development Corporation vs. Commissioner of Internal Revenue , 142 transitional input tax credit operates to benefit newly VAT-registered persons, whether or not they previously paid taxes in the acquisitions of their beginning inventory of goods, materials and supplies. During the transition period from non-VAT to VAT status, the transitional input tax credit alleviates the impact of the VAT on the taxpayer. Since there is no showing that the claimed input taxes are transitional, petitioner has complied with the sixth requisite for the grant of an input VAT refund. Seventh requisite: Not all input taxes being claimed are due or paid . Anent the seventh requisite in claiming a VAT refund, it is indispensable for petitioner to provide supporting documents proving that the input taxes claimed during the period covering April 1, 2017 to March 31, 2018 were due or paid under Section 110 (A) of the NIRC of 1997, as amended, to wit: SEC. 110. Tax Credits . (A) Creditable input Tax . (1) Any input tax evidenced by a VAT invoice or official receipt issued in accordance with Section 113 hereof on the following transactions shall be creditable against the output tax: ASEcHI (a) Purchase or importation of goods: (1) For sale; or (ii) For conversion into or intended to form part of a finished product for sale including packaging materials; or (iii) For use as supplies in the course of business; or (iv) For use as materials supplied in the sale of service; or (v) For use in trade or business for which deduction for depreciation or amortization is allowed under this Code. (b) Purchase of services on which a value-added tax has actually been paid. (2) The input tax on domestic purchase or importation of goods or properties by a VAT-registered person shall be creditable: (a) To the purchaser upon consummation of sale and on importation of goods or properties; and (b) To the importer upon payment of the value-added tax prior to the release of the goods from the custody of the Bureau of Customs. Provided , That the input tax on goods purchased or imported in a calendar month for use in trade or business for which deduction for depreciation is allowed under this Code shall be spread evenly over the month of acquisition and the fifty-nine (59) succeeding months if the aggregate acquisition cost for such goods, excluding the VAT component thereof, exceeds One million pesos (P1,000,000): Provided, however, That if the estimated useful life of the capital good is less than five (5) years, as used for depreciation purposes, then the input VAT shall be spread over such a shorter period: Provided , finally, That in the case of purchase of services, lease or use of properties, the input tax shall be creditable to the purchaser, lessee or licensee upon payment of the compensation, rental, royalty or fee. The above provisions are implemented by Sections 4.110-1 to 4.110-3 of RR No. 16-2005, which read as follows: "SECTION 4.110-1. Credits for Input Tax . "Input tax" means the VAT due on or paid by a VAT-registered person on importation of goods or local purchases of goods, properties, or services, including lease or use of properties, in the course of his trade or business. It shall also include the transitional input tax and the presumptive input tax determined in accordance with Sec. 111 of the NIRC of 1997, as amended. cTDaEH It includes input taxes which can be directly attributed to transactions subject to the VAT plus a ratable portion of any input tax which cannot be directly attributed to either the taxable or exempt activity. Any input tax on the following transactions evidenced by a VAT invoice or official receipt issued by a VAT-registered person in accordance with Secs. 113 and 237 of the NIRC of 1997, as amended, shall be creditable against the output tax: (a) Purchase or importation of goods (1) For sale; or (2) For conversion into or intended to form part of a finished product for sale, including packaging materials; or (3) For use as supplies in the course of business; or (4) For use as raw materials supplied in the sale of services; or (5) For use in trade or business for which deduction for depreciation or amortization is allowed under the NIRC of 1997, as amended, (b) Purchase of real properties for which a VAT has actually been paid; (c) Purchase of services in which a VAT has actually been paid; (d) Transactions "deemed sale" under Sec. 106 (B) of the NIRC of 1997, as amended; (e) Transitional input tax allowed under Sec. 4.111 (a) of these Regulations; (f) Presumptive input tax allowed under Sec. 4.111 (b) of these Regulations; (g) Transitional input tax credits allowed under the transitory and other provisions of these Regulations. SECTION 4.110-2. Persons Who Can Avail of the Input Tax Credit . The input tax credit on importation of goods or local purchases of goods, properties or services by a VAT-registered person shall be creditable: (a) To the importer upon payment of VAT prior to the release of goods from customs custody; (b) To the purchaser of the domestic goods or properties upon consummation of the sale; or (c) To the purchaser of services or the lessee or licensee upon payment of the compensation, rental, royalty or fee." ITAaHc Relative thereto, Section 4.110-8 of RR No. 16-2005 provides for the substantiation requirements of input tax credits as follows: "SEC. 4.110-8. Substantiation of Input Tax Credits . (a) Input taxes for the importation of goods or the domestic purchase of goods, properties or services is made in the course of trade or business, whether such input taxes shall be credited against zero-rated sale, non-zero-rated sales, or subjected to the 5% Final Withholding VAT, must be substantiated and supported by the following documents, and must be reported in the information returns required to be submitted to the Bureau: (1) For the importation of goods import entry or other equivalent document showing actual payment of VAT on the imported goods. (2) For the domestic purchase of goods and properties invoice showing the information required under Secs. 113 and 237 of the Tax Code. (3) For the purchase of real property public instrument, i.e. , deed of absolute sale, deed of conditional sale, contract/agreement to sell, etc., together with VAT invoice issued by the seller. (4) For the purchase of services official receipt showing the information required under Secs. 113 and 237 of the Tax Code." Verily, to prove entitlement to credits for input taxes due and paid, petitioner must not only present the supporting documents prescribed under Section 4.110-8 of RR No. 16-2005 but also, these documents must comply with the invoicing requirements under Sections 113 (A) and (B), 237 and 238 of the NIRC of 1997, as amended, and as implemented by Section 4.113-1 (A) and (B) of RR No. 16-2005, which were quoted earlier. Based on its Amended Quarterly VAT Returns 143 for the period covering April 1, 2017 to March 31, 2018, petitioner reported current input tax from various purchases of goods and services amounting to P1,538,046,028.73, out of which the amount of P1,218,800,809.92 144 is the subject of its administrative claim for refund, 145 as shown below: Particulars FY FY FY FY 1st Qtr 2018 2nd Qtr 2018 3rd Qtr 2018 4th Qtr 2018 Total P-450-c P-29/P-450-e P-35/P-450-g P-450-k Deferred from the previous quarter P20,153,348.91 P17,048,737.55 P14,161,000.03 P11,568,171.64 P62,931,258.13 Less: Deferred for the succeeding period 17,048,737.53 14,161,000.04 11,568,171.62 9,280,906.18 52,058,815.37 Amortized input tax on capital goods exceeding P1M 3,104,611.38 2,887,737.51 2,592,828.41 2,287,265.46 10,872,442.76 Input tax on domestic purchases of goods other than capital goods 92,222,554.55 129,437,440.44 178,735,782.68 244,961,566.10 645,357,343.77 Input Tax on importation of goods other than capital goods 56,150,842.00 65,856,117.10 119,303,871.30 76,416,213.00 317,727,043.40 Input tax on domestic purchases of services 120,840,418.54 108,281,885.32 152,080,513.68 143,823,321.73 525,026,139.27 Services Rendered by Non-Residents 5,341,028.73 9,563,209.48 11,091,999.61 13,026,744.28 39,022,982.10 Creditable Withholding VAT (reflected as Others in VAT Returns) 8,505.86 6,946.99 5,004.15 19,620.44 40,077.44 Total input tax during the period P277,667,961.06 P316,033,336.84 P463,809,999.83 P480,534,731.01 P1,538,046,028.74 Less: Output tax 57,947,061.26 63,669,011.29 131,774,115.09 65,855,031.16 319,245,218.81 Excess input tax P219,720,899.80 P252,364,325.55 P332,035,884.74 P414,679,699.85 P1,218,800,809.93 Out of the reported input VAT of P1,538,046,028.74 during the period of claim, respondent found that petitioner's allowable input VAT amounted to P1,422,392,553.50, 146 while the remaining input VAT amounting to P115,653,475.24 was disallowed due to the alleged non-compliance with the invoicing requirements, among others. Moreover, the additional amount of P209,618,068.10 was deducted from petitioner's claim for refund, which represents the output VAT imposed upon petitioner, compromise penalty, and the input VAT allocated to sales allegedly not qualified for zero-rating, as well as exempt sales. To the point of being repetitive, the input VAT amount of P325,271,543.33 was disallowed for refund by respondent, and, thus, has been the subject of the present claim before the Court. cSaATC To support its input taxes from importations and domestic purchases of goods and services, petitioner submitted the Single Administrative Document ("SAD") , Temporary Assessment Notices, and SSDT 147 issued by the BOC and VAT sales invoices and official receipts 148 issued by its various suppliers. The denied portion of petitioner's claim for refund of the excess and unutilized input tax aggregating P325,271,543.33 are accounted for as follows: 149 No. ICPA Report, Table Nos. 6 and 10 150 Item No. Particulars Amount Annexed to Exhibit "P-77" Exhibits 1 Item Nos. 1 to 4, 6 to 14, 16, 20, & 21 The total amount of disallowed input VAT due to Non-compliance with the invoicing requirements, double/over-claimed input VAT, insufficient/no supporting documents, invalid ATP/failure to indicate ATP, and supported by out-of-period VAT SIs or ORs P114,899,296.26 Annex B , pp. 20-22 "P-78" to "P-106" Annex C , p. 23 "P-108" to "P-121" Annex D , p. 24 "P-122" to "P-128" Annexes F to N , pp. 24-27 "P-130" to "P-156" Annex P , p. 29 "P-164" Annexes S to T , pp. 29-30. "P-166" to "P-171" 2 Item No. 5 Non-VAT per ITS verification 754,178.95 Annex E , p. 24 "P-129" Total Disallowances pertaining to Input VAT during the period P115,653,475.23 3 Item No. 15 Additional output VAT based on considered export sales without prior approved VAT zero-rating 5,918,954.44 Annex O , p. 28 "P-157.1" to "P-163" 4 Item No. 17 Allocation of input tax on unremitted export sales 51,333.07 Annex Q , p. 29 "P-165" 5 Item Nos. 18 & 22 The total amount of input VAT allocable to exempt sales 19,226,034.11 Annex R , p. 29 - Annex U , p. 30 - 6 Item No. 23 The total amount of disallowed input VAT allocable to sales not qualified for zero-rated 184,409,246.48 Table V-1 , p. 31 7 Item No. 19 Compromise Penalty 12,500.00 Total Disallowances P325,271,543.33 Based on the ICPA report, out of the input VAT of P115,653,475.23, We find the following disallowances amounting to P92,561,103.84 proper, thus, shall be sustained: CHTAIc No. Particulars Disallowed Input VAT per CIR Annexed to Exhibit "P-77" Exhibits Amount 1 The total amount of disallowed input VAT due to Non-compliance with the invoicing requirements, insufficient/no supporting documents, invalid ATP/failure to indicate ATP, and supported by out-of-period VAT SIs or ORs (Item Nos. 1 to 4, 6 to 14, 16, 20 & 21) P114,899,296.28 Annex B , pp. 21-22 "P-86" to "P-106" P42,669,750.22 Annex C , p. 23 "P-109" to "P-121" 2,324,802.13 Annex D , p. 24 "P-123" to "P-128" 21,984,083.28 Annexes F to N , pp. 24-27 "P-130" to "P-156" 18,504,135.80 Annex P , p. 29 "P-164" 5,144,460.88 Annexes S to T , pp. 29-30 "P-166" to "P-169" and "P-171" 1,179,692.58 2 Non-VAT per ITS verification (Item No. 5) 754,178.95 Annex E , p. 24 "P-129" 754,178.95 Grand Total P115,653,475.23 P92,561,103.84 In addition, upon further verification, the Court finds that the total amount of P17,602,110.62 should likewise be disallowed for the reasons stated below: 1. Input VAT not declared separately Exhibit No. Name of Supplier Date SI/OR No. Input VAT Amount "P-78-iv" MALLBERRY SUITES 01/12/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 336531 P409.07 "P-85-b" SARANGANI RESOURCES CORP. 05/05/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 3249 144,020.98 Subtotal P144,430.05 2. Overdeclared input VAT Exhibit No. Name of Supplier Date SI/OR No. Input VAT Amount "P-78-cq" ECCO HARDWARE, INC. 03/08/2018 VAT REG. TIN CHARGE SALES INVOICE NO. 85774 P30.72 "P-108-a" ADELA M. BUSTOS TRUCKING 2/21/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 0089 33,019.00 "P-108-c" ADELA M. BUSTOS TRUCKING 3/5/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 0090 46,106.65 "P-122-m" to "P-122-q" RVB MACHINE SHOP & ENGINEERING SERVICES 03/15/2018 VAT REG. TIN CHARGE INVOICE NO. 7521 14,400.00 Subtotal P93,556.37 3. Input VAT supported by blurred OR/SI Exhibit No. Name of Supplier Date SI/OR No. Input VAT Amount "P-78-ay" ACE HARDWARE PHILIPPINES, INC. 07/06/2017 VAT REG. TIN SALES INVOICE NOS. 816-000096719, 816-000095037, 816-000094286, 816-000091921, 817-000107250, 817-000107833, 817-000105952, 815-000096070, 816-000094289 P362.51 "P-78-cy" REACHEM INDUSTRIES, INC. 03/23/2018 VAT REG. TIN SALES INVOICE NO. 34429 1,178.57 Subtotal P1,541.08 4. Input VAT supported by ORs but failed to indicate the nature of service rendered Exhibit No. Name of Supplier Date SI/OR No. Input VAT Amount "P-78-cz" to "P-78-dg" NMC CONTAINER LINES, INC. 04/06/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0162747 P25,074.44 "P-78-dh" to "P-78-dn" NMC CONTAINER LINES, INC. 04/06/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0162748 18,806.98 "P-78-do" to "P-78-ds" NMC CONTAINER LINES, INC. 04/06/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0162749 19,886.98 "P-78-dv" to "P-78-ee" DS DYNATEC INDUSTRIAL SOLUTIONS AND ENGG 04/27/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0055 33,840.00 "P-78-ef" RTX ELECTRONICS TRADING AND SERVICES 05/20/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0666 2,160.00 "P-78-eg" RTX ELECTRONICS TRADING AND SERVICES 05/20/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0667 2,280.00 "P-78-eh" PPLM INDUSTRIAL CORPORATION 06/08/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 5423 15,600.00 "P-78-ej" to "P-78-em" AERON EQUIPMENT SALES & RENTAL SERVICES 06/22/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 001005 24,357.01 "P-78-en" RTX ELECTRONICS TRADING AND SERVICES 07/02/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0668 2,160.00 "P-78-eo" RTX ELECTRONICS TRADING AND SERVICES 07/02/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0669 2,280.00 "P-78-ep" BETAN CALIBRATION TECHNIQUE 07/05/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 19657 13,500.00 "P-78-eq" LEADING BLDG. INTELLIGENCE (LBI) PHILS., INC. 07/14/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 078 41,280.00 "P-78-er" DOLE ASIA COMPANY LIMITED 07/27/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 02804 67,387.41 "P-78-es" RTX ELECTRONICS TRADING AND SERVICES 08/01/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0670 2,160.00 "P-78-et" RTX ELECTRONICS TRADING AND SERVICES 08/01/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0671 2,280.00 "P-78-eu" RTX ELECTRONICS TRADING AND SERVICES 08/21/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0657 5,508.00 "P-78-ev" RTX ELECTRONICS TRADING AND SERVICES 08/21/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0658 7,344.00 "P-78-ex" RTX ELECTRONICS TRADING AND SERVICES 08/30/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0672 2,160.00 "P-78-ey" RTX ELECTRONICS TRADING AND SERVICES 08/30/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0674 2,280.00 "P-78-ez" MONARK EQUIPMENT CORP. 08/31/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 00951 2,856.84 "P-78-fa" J.E. PALERMO CONSTRUCTION & MATERIALS SU 09/06/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 3890 83,247.37 "P-78-fb" MT. MATUTUM HEALTH CARE FOUNDATION, INC. 09/07/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 230262 6,477.76 "P-78-go" DOLE ASIA COMPANY, LTD. (DPGSL PHILIPPINES) 09/20/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 02838 489,951.01 "P-78-gp" RTX ELECTRONICS TRADING AND SERVICES 09/30/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0675 2,280.00 "P-78-gq" RTX ELECTRONICS TRADING AND SERVICES 10/01/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0662 2,160.00 "P-78-gr" RTX ELECTRONICS TRADING AND SERVICES 10/01/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0663 2,160.00 "P-78-gs" WRU CORPORATION 10/19/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0003406 18,214.29 "P-78-gt" RTX ELECTRONICS TRADING AND SERVICES 10/30/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0676 2,160.00 "P-78-gu" RTX ELECTRONICS TRADING AND SERVICES 10/30/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0682 2,280.00 "P-78-gy" RTX ELECTRONICS TRADING AND SERVICES 11/30/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0678 2,280.00 "P-78-ha" 2GO GROUP, INC. 12/08/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0541336 4,203.21 "P-78-hb" to "P-78-he" SOUTH COTABATO INTEGRATED PORT SERVICES 12/11/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 206930 153.60 "P-78-hf" to "P-78-hh" KPS TRUCKING SERVICES 12/12/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0035 50,127.47 "P-78-hi" to "P-78-ht" KAICOSH CORPORATION 12/13/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0114 41,396.58 "P-78-hv" to "P-78-hy" GRANDCITY HOTEL 12/21/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 121140 2,070.01 "P-78-ia" to "P-78-ib" SOUTH COTABATO INTEGRATED PORT SERVICES 12/23/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 207543 2,379.84 "P-78-ig" to "P-78-ij" TNL EXPRESS WORLDWIDE CORP. 01/05/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 7055 1,584.00 "P-78-ik" to "P-78-it" KAICOSH CORPORATION 01/09/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 0121 47,880.12 "P-78-iu" MALLBERRY SUITES 01/12/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 336531 231.43 "P-78-iw" to "P-78-ix" IRELAN'S ENTERPRISES 01/12/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 6802 2,886.00 "P-78-iy" to "P-78-jc" IRELAN'S ENTERPRISES 01/19/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 6803 6,120.00 "P-78-jv" RTX ELECTRONICS TRADING AND SERVICES 02/15/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 0679 2,280.00 "P-78-jw" R & G RUIZ CONSTRUCTION, INC. 03/01/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 0106 12,978.60 "P-78-kd" SGS PHILIPPINES, INC. 03/07/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 0156907 300.00 "P-78-ke" to "P-78-kl" KAICOSH CORPOR 03/12/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 0160 14,487.81 "P-78-km" ASIAN MARINE TRANSPORT CORP. 03/12/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 58032 49,345.71 "P-78-kn" ASIAN MARINE TRANSPORT CORP. 03/12/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 58037 218,628.00 "P-78-kr" AJ SUELA & REDUCTO TRUCKING SERVICES 03/16/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 5874 1,865.99 "P-78-ks" ASIAN MARINE TRANSPORT CORP. 03/20/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 58035 52,736.79 "P-78-kt" R & G RUIZ CONSTRUCTION, INC. 03/22/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 0108 31,800.00 "P-81-a" NARCISO FARM, INC. 06/01/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 0301 6,804,000.00 "P-83-a" DOLE ASIA COMPANY, LTD. (DPGSL PHILIPPINES) 04/07/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 02761 300,134.94 "P-83-b" DOLE ASIA COMPANY, LTD. (DPGSL PHILIPPINES) 05/04/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 02769 363,430.18 "P-83-c" DOLE ASIA COMPANY, LTD. (DPGSL PHILIPPINES) 06/05/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 02780 790,903.60 "P-83-d" DOLE ASIA COMPANY, LTD. (DPGSL PHILIPPINES) 06/29/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 02789 537,068.86 "P-84-a" DOLE ASIA COMPANY, LTD. (DPGSL PHILIPPINES) 07/27/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 02806 357,409.40 "P-108-b" ADVENT TRANSPORT SERVICES 03/02/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 0059 103.53 "P-122-v" to "P-122-x" TROPILAND ENTERPRISES 04/12/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 5026 57,036.00 "P-112-y" to "P-122-ac" CMKT ENTERPRISES 03/01/2018 VAT REG. TIN OFFICIAL RECEIPT NO. 423 40,649.09 "P-134-a" DAVAO INT'L. CONTAINER TERMINAL, INC. 08/11/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 115833 1,386.97 "P-134-b" DAVAO INT'L. CONTAINER TERMINAL, INC. 11/30/2017 VAT REG. TIN OFFICIAL RECEIPT NO. 126781 4,160.92 P10,704,150.74 5. Input VAT without supporting documents "P-79" VARIOUS SUPPLIERS - - 6,658,432.38 P6,658,432.38 TOTAL P17,602,110.62 Considering the foregoing, out of the input VAT of P115,653,475.23 (previously disallowed by respondent), the Court finds that the amount of P5,490,260.77 was properly supported in accordance with the invoicing and substantiation requirements under the law and regulations, computed as follows: cHDAIS Total input VAT for the period covering April 1, 2017 to March 31, 2018 accounted for by petitioner (Item Nos. 1 to 14, 16, 20 & 21) P115,653,475.23 Less: Disallowances Per ICPA report 92,561,103.84 Per the Court's further verification 17,602,110.62 Total Disallowances (110,163,214.46) Valid Input VAT per this Court's verification P5,490,260.77 Hence, petitioner complied with the seventh requisite, i.e. , the input taxes are due or paid, but only in the amount of P5,490,260.77. As for the deferred input VAT amounting to P5,144,460.88 and bond already refunded by BOC amounting to P1,075,123.00, or in the aggregate amount of P6,219,583.88, petitioner is already amenable to these disallowances. 151 Eighth requisite: A portion of the input taxes claimed by petitioner are attributable to zero-rated or effectively zero- rated sales . The eighth requisite is that the input VAT claimed is attributable to zero-rated or effectively zero-rated sales. However, where there are both zero-rated or effectively zero-rated sales and taxable or exempt sales, and the input taxes cannot be directly and entirely attributable to any of these sales, the input taxes shall be proportionately allocated based on sales volume. EATCcI As discussed earlier, petitioner declared in its Amended Quarterly VAT returns for the period covering April 1, 2017 to March 31, 2018 a total sales of P36,785,576,550.64 consisting of VAT-subject sales amounting to P2,660,376,823.43, zero-rated sales amounting to P33,665,195,868.50, and exempt sales amounting to P460,003,858.71. However, since petitioner's valid input VAT for the same quarter in the total amount of P1,427,882,814.27 152 cannot be identified to specific sales, this Court shall proportionately allocate the said input VAT based on the volume of petitioner's sales, thus: Total Zero-Rated Sales per VAT Returns P33,665,195,868.50 Divided by the Reported Total Sales per Quarterly VAT Returns P36,785,576,550.64 Multiplied by Total Valid Input VAT P1,427,882,814.27 Valid input VAT allocated to total zero-rated sales P1,306,760,940.76 Total VATable Sales per VAT Returns P2,660,376,823.43 Divided by the Reported Total Sales per Quarterly VAT Returns P36,785,576,550.64 Multiplied by Total Valid Input VAT P1,427,882,814.27 Valid input VAT allocated to VATable sales P103,266,190.23 Total Exempt Sales per VAT Returns P460,003,858.71 Divided by the Reported Total Sales per Quarterly VAT Returns P36,785,576,550.64 Multiplied by Total Valid Input VAT P1,427,882,814.27 Valid input VAT allocated to Exempt sales P17,855,683.29 Thus, with regard to petitioner's compliance with the eighth requisite, only the amount of P1,306,760,940.76 represents its valid input VAT attributable to the total declared zero-rated for the subject period of the claim. Ninth requisite: Petitioner's input taxes have not been applied against output taxes during and in the succeeding quarters As regards the ninth requisite, petitioner reported output taxes from its taxable sales for the 1st to 4th quarter of FY 2018 in the aggregate amount of P319,245,218.80, to wit: ISHCcT FY ending March 2018 Output VAT 1st Quarter 153 P57,947,061.26 2nd Quarter 154 63,669,011.29 3rd Quarter 155 131,774,115.09 4th Quarter 156 65,855,031.16 Total P319,245,218.80 In the recent case of Chevron Holdings, Inc. (Formerly Caltex Asia Limited) vs. Commissioner of Internal Revenue , 157 the Supreme Court held that the input tax attributable to zero-rated sales, may, at the option of the VAT-registered taxpayer, be: (1) charged against output tax from regular 12% VAT-able sales, and any unutilized or "excess" input tax may be claimed for refund or the issuance of tax credit certificate; or (2) claimed for refund or tax credit in its entirety, and such option is vested with the taxpayer-claimant, to wit: "Thus, the input tax attributable to zero-rated sales may, at the option of the VAT-registered taxpayer , be: (1) charged against output tax from regular 12% VAT-able sales, and any unutilized or "excess" input tax may be claimed for refund of the issuance of tax credit certificate ; or (2) claimed for refund or tax credit in its entirety . It must be stressed that the remedies of charging the input tax against the output tax and applying for a refund or tax credit are alternative and cumulative . Furthermore, the option is vested with the taxpayer-claimant . . . ." [Emphases and underscoring supplied.] Applying the foregoing, records show that petitioner chose the first option, i.e. , it computed its claim for refund in the aggregate amount of P1,218,800,809.92 by offsetting its output tax from the regular VATable sales against its available input taxes for the 1st to 4th quarters of FY ending March 2018, as shown hereafter: Input Tax Local purchases of goods and services P1,170,383,483.03 Importation 317,727,043.40 Service rendered by Non-Residents 39,022,982.10 Government Transactions 40,077.44 Amortization of Input Tax on Capital Goods 10,872,442.76 Less: Output Tax (319,245,218.80) Net VAT Refund P1,218,800,809.92 It is clear from the foregoing that petitioner opted to claim a refund of its unutilized or "excess" input tax, which is the amount after charging the input tax allocated to zero-rated sales against its output tax liabilities. DHITCc Following the same computation, since petitioner's valid input VAT allocated to sales subject to the 12% VAT in the amount of P103,266,190.23, as earlier determined, is not enough to cover its output VAT liability amounting to P319,245,218.80, the output VAT still due amounting to P215,979,028.57 shall then be charged against its valid input VAT attributable to total reported zero-rated sales of P1,306,760,940.76, leaving an excess input VAT attributable to total zero-rated sales of P1,090,781,912.18, as herein computed: Output VAT P319,245,218.80 Less: Valid Input VAT allocated to sales subject to 12% VAT 103,266,190.23 Output VAT Still Due P215,979,028.57 Valid input VAT allocated to zero-rated sales P1,306,760,940.76 Less: Output VAT Still Due 215,979,028.57 Excess Input VAT attributable to zero-rated sales P1,090,781,912.18 However, as discussed earlier, petitioner was able to properly substantiate only the total amount of P31,384,368,317.33 out of its total declared zero-rated sales of P33,665,195,868.50. Consequently, only the input VAT of P1,016,881,096.42 is attributable to the said valid zero-rated sales of P31,384,368,317.33, as computed below: Excess Input VAT attributable to total reported zero-rated sales P1,090,781,912.18 Divided by Total Reported Zero-rated sales P33,665,195,868.50 Multiplied by Valid zero-rated sales P31,384,368,317.33 Excess Input VAT attributable to valid zero-rated sales P1,016,881,096.42 However, since respondent had already issued a TCC in the amount of P893,529,266.59 in favor of petitioner for its input VAT on domestic purchases, the said amount of P893,529,266.59 shall be offset against the valid input VAT attributable to zero-rated sales of P1,016,881,096.42, as found by this Court, to determine the amount of input VAT still to be refunded to petitioner. CAacTH Thus, for the 1st to 4th quarters of FY 2018, petitioner is still entitled to the refund of the amount of P123,351,829.83 (P1,016,881,096.42 less P893,529,266.59). Although petitioner carried over the claimed amount of P1,218,800,809.92 in its succeeding quarters/period, the same remained unutilized until it was deducted as "VAT Refund/TCC claimed" 158 in its Quarterly VAT Return for the 4th quarter of FY ending March 2019, albeit , only in the amount of P1,199,574,775.84, since the discrepancy of which amounting to P19,226,034.08 159 pertains to input VAT allocable to exempt sales which were already deducted and do not anymore form part of the petitioner's allowable input tax to be carried over, as disclosed in its VAT Returns for the 1st to 4th quarters of FY ending March 2018. Accordingly, the subject claim no longer formed part of the excess input VAT of P1,332,824,668.48 as of the end of the 4th quarter of FY ending March 2019, to be carried over to the next quarters. Such being the case, the excess valid input VAT of P123,351,829.83 was not utilized or applied against any output tax liability during the 1st quarter of FY 2020 and in the succeeding quarters. In fine, petitioner was able to satisfy the ninth requisite and has sufficiently proven its entitlement to the refund or issuance of TCC in the amount of P123,351,829.83, representing excess and unutilized input VAT attributable to its zero-rated sales for the 1st to 4th quarters of FY ending March 2018. Respondent's imposition of a compromise penalty is not proper . Respondent imposed compromise penalty amounting to P12,500.00 for failure to supply the correct information and deducted the same from petitioner's input VAT claim. Petitioner argues that it cannot be compelled to pay the compromise penalty since a compromise agreement implies a mutual agreement between the parties regarding the thing or subject matter that is so compromised, and the choice of paying or not paying it distinctly belongs to the taxpayer. This Court agrees with petitioner. Under Revenue Memorandum Order ("RMO") No. 7-2015, 160 compromise penalties are the only amounts suggested in settlement of criminal liability. They may not be imposed or exacted on the taxpayer if a taxpayer refuses to pay the proposed compromise penalties. It is well-settled that the Court has no jurisdiction to compel a taxpayer to pay the compromise penalty because, by its very nature, it implies a mutual agreement between the parties with respect to the thing or subject matter which is so compromised, and the choice of paying or not paying it distinctly belongs to the taxpayer. 161 Absent a showing that petitioner consented to the compromise penalty herein, its imposition should be deleted. The imposition of the same without the conformity of the taxpayer is illegal and unauthorized. 162 cEaSHC Hence, there being no compromise agreement between the parties in the instant case, the compromise penalty imposed by respondent should be cancelled. Final note An applicant for a tax refund or tax credit must not only prove entitlement to the claim but also comply with all the documentary and evidentiary requirements, such as VAT invoicing requirements provided by tax laws and regulations. 163 Well-settled is the rule that tax refunds or credits are strictly construed against the taxpayer, just like tax exemptions. The burden is on the taxpayer to show that he has strictly complied with the conditions for the grant of the tax refund or credit. 164 However, once the requirements laid down by the NIRC of 1997, as amended, have been met, a claimant should be considered successful in discharging its burden of proving its right to refund. Thereafter, the burden of going forward with the evidence, as distinct from the general burden of proof, shifts to the opposing party, the respondent. It is then the turn of the latter to disprove the claim by presenting contrary evidence. 165 WHEREFORE , in light of the foregoing, the instant Petition for Review is PARTIALLY GRANTED . Accordingly, respondent is ORDERED TO REFUND OR ISSUE A TAX CREDIT CERTIFICATE in favor of petitioner in the additional amount of One Hundred Twenty-Three Million Three Hundred Fifty-One Thousand Eight Hundred Twenty-Nine Pesos and Eighty-Three Centavos (P123,351,829.83), representing petitioner's excess and unutilized input VAT attributable to its zero-rated sales for the 1st to 4th quarters of FY ending March 2018. SO ORDERED. (SGD.) LANEE S. CUI-DAVID Associate Justice Jean Marie A. Bacorro-Villena, J. , with separate opinion. Separate Opinions BACORRO-VILLENA , J. : I concur with the ponencia of my esteemed colleague Associate Justice Lanee S. Cui-David in ruling that: (1) petitioner complied with the requisites for granting a claim for refund of unutilized input tax; (2) certain zero-rated sales must be disallowed for failure to show proof of actual shipment and/or incomplete supporting documents, failure to comply with the invoicing requirements (such as incorrect Tax Identification Number) and failure to formally offer some invoices; and, (3) some input taxes must be disallowed because of non-compliance with the invoicing requirements or blurred sales invoices/Official Receipts ( OR s). IAETDc However, with due respect, I espouse a different view as regards the computation of the refundable amount. In my previous Separate Opinion in the Court En Banc case of Maersk Global Services Centres (Philippines) Ltd. v. Commissioner of Internal Revenue , 1 I outlined what I deem to be the correct steps in computing the amount of the refundable input value-added tax (VAT) based on the recent Supreme Court decision in Chevron Holdings, Inc. (formerly Caltex Asia Limited) v. Commissioner of Internal Revenue 2 (Chevron) : 1. Determine the amount of substantiated or valid input VAT; 2. Deduct from the substantiated or valid input VAT any input VAT directly attributable to a specific activity to arrive at the substantiated or valid input VAT not attributable to any activity; 3. Multiply the substantiated or valid input VAT not attributable to any activity by the ratio of Valid Zero-Rated Sales over Total Sales to determine the amount of substantiated or valid input VAT attributable to zero-rated sales; 4. Add to the amount computed in no. 3 any substantiated or valid input VAT directly attributable to zero-rated sales to arrive at the total substantiated or valid input VAT attributable to zero-rated sales; and, 5. Deduct from the total substantiated or valid input VAT attributable to zero-rated sales any input VAT already charged by the taxpayer-claimant against its output VAT liability and any input VAT carried-over instead. Applying the foregoing steps, I forward and submit the following illustration thereof, to wit: Step 1 It is observable from the Decision that the amount of substantiated or valid input VAT is P1,427,882,814.27. Step 2 No input VAT is directly attributable to a specific activity. Step 3 The amount of substantiated or valid input VAT attributable to zero-rated sales is computed as follows: Total Valid Zero-Rated Sales P31,384,368,317.33 Divided by the Reported Total Sales per Quarterly VAT Returns 36,785,576,550.64 Multiplied by Total Valid Input VAT 1,427,882,814.27 Valid input VAT allocated to total valid zero-rated sales P1,218,227,478.24 Step 4 No input VAT is directly attributable to a specific activity. CTIEac Step 5 Refundable amount is: Output VAT P319,245,218.80 Total VATable Sales per VAT Returns P2,660,376,823.43 Divided by the Reported Total Sales per Quarterly VAT Returns 36,785,576,550.64 Multiplied by Total Valid Input VAT 1,427,882,814.27 Valid input VAT allocated to VATable sales 103,266,190.23 VAT paid per VAT Returns - Input VAT attributable to zero-rated sales that was effectively applied against the output VAT P215,979,028.57 Valid input VAT allocated to total valid zero-rated sales P1,218,227,478.24 Less: Input VAT attributable to zero-rated sales that was effectively applied against the output VAT 215,979,028.57 Valid and substantiated input VAT that found to be unutilized and should be refundable P1,002,248,449.67 Less: Already supported by a tax credit certificate (TCC) 893,529,266.59 Amount still to be refunded P108,719,183.08 In contrast, the ponencia computed a refundable amount of P123,351,829.83 in the following manner: Output VAT P319,245,218.80 Less: Valid Input VAT allocated to sales subject to 12% VAT 103,266,190.23 Output VAT Still Due P215,979,028.57 Valid input VAT allocated to zero-rated sales P1,306,760,940.76 Less: Output VAT Still Due P215,979,028.57 Excess Input VAT attributable to zero-rated sales P1,090,781,912.18 Excess input tax attributable to total reported zero-rated sales P1,090,781,912.18 Divided by total reported zero-rated sales 33,665,195,868.50 Multiplied by valid zero-rated sales 31,384,368,317.33 Excess input tax attributable to valid zero-rated sales P1,016,881,096.42 Less: Already supported by a tax credit certificate (TCC) 893,529,266.59 Amount still to be refunded P123,351,829.83 From the above, the difference resulted from the treatment of the "Input VAT attributable to zero-rated sales that was effectively applied against the output VAT" or "Output VAT Still Due" amounting to P215,979,028.57. DcHSEa With due respect, I submit that such amount should be deducted from the valid input VAT allocated to total valid zero-rated sales and not just from the valid input VAT allocated to total zero-rated sales . It must be noted that the option of the VAT-registered taxpayer on whether to charge against output tax from regular 12% VAT-able sales and any unutilized or "excess" input tax may be claimed for refund or the issuance of tax credit certificate, or whether to claim for refund or tax credit in its entirety, only applies to substantiated input tax attributable to valid zero-rated sales . This can be gleaned from the following computation of the Supreme Court in Chevron , 3 citing Section 4.110-4 4 of RR No. 16-2005, 5 as amended by RR No. 4-2007: 6 xxx xxx xxx Thus, the refundable input VAT is computed by getting the percentage of valid zero-rated sales over total reported sales (taxable, zero-rated, and exempt) multiplied by the properly substantiated input taxes not directly attributable to any of the transactions. xxx xxx xxx Accordingly, Chevron Holdings is entitled to the refund of unutilized input tax allocable to its zero-rated sales for January 1 to December 31, 2006, in the total amount of P1,140,381.22, 103 computed as follows: First Quarter Second Quarter Third Quarter Fourth Quarter Valid Zero-Rated Sales 5,762,011.70 4,669,743.23 66,091,331.71 79,131,661.58 Divided by: Total reported sales 313,164,583.06 272,400,438.61 299,500,840.65 501,152,183.16 Multiplied by: Valid input tax not directly attributable to any activity 1,276,656.14 1,650,503.65 1,860,385.53 4,294,269.68 Input tax attributable to zero-rated sales 23,489.59 28,294.48 410,534.26 678,062.88 TOTAL P1,140,181.22 xxx xxx xxx All told, I vote to PARTIALLY GRANT petitioner Dole Philippines, Inc.'s Petition for Review and ORDER respondent Commissioner of Internal Revenue to refund the recomputed amount of P108,719,183.08 . SaCIDT Footnotes 1. Dated November 8, 2019, received by the Court on November 13, 2019; Docket Vol. I, pp. 6-35. 2. Section 3. Who May Appeal; Period to File Petition . (a) A party adversely affected by a decision, ruling or the inaction of the Commissioner of Internal Revenue on disputed assessments or claims for refund of internal revenue taxes, or by a decision or ruling of the Commissioner of Customs, the Secretary of Finance, the Secretary of Trade and Industry, the Secretary of Agriculture, or a Regional Trial Court in the exercise of its original jurisdiction may appeal to the Court by petition for review filed within thirty days after receipt of a copy of such decision or ruling, or expiration of the period fixed by law for the Commissioner of Internal Revenue to act on the disputed assessments. In case of inaction of the Commissioner of Internal Revenue on claims for refund of internal revenue taxes erroneously or illegally collected, the taxpayer must file a petition for review within the two-year period prescribed by law from payment or collection of the taxes. 3. Section 3. Cases within the Jurisdiction of the Court in Divisions . The Court in Divisions shall exercise: (a) Exclusive original or appellate jurisdiction to review by appeal the following: (1) Decisions of the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of internal revenue taxes, fees or other charges, penalties in relation thereto, or other matters arising under the National Internal Revenue Code or other laws administered by the Bureau of Internal Revenue. 4. A.M. No. 05-11-07-CTA. 5. Exhibit "P-1", Docket Vol. I, p. 305; Pars. 3.1 and 4.1, Petition for Review, Docket Vol. I, p. 8. 6. Exhibit "P-2-a", Docket Vol. I, pp. 306-307. 7. Exhibit "P-3", Docket Vol. I, p. 324. 8. Exhibits "P-3-A" to "P-3-Z", Docket Vol. I, pp. 326-351. 9. Par. 3.2, Petition for Review, Docket Vol. I, p. 8. 10. Exhibit "P-68", Docket Vol. II, pp. 954 to 955. 11. Exhibit "P-70", Docket Vol. II, p. 970. 12. Exhibits "P-73-A" and "P-73-B", Docket Vol. II, pp. 974 to 975. 13. Exhibit "P-73", Docket Vol. II, p. 973. 14. Docket Vol. I, pp. 6 to 36. 15. Respondent's Motion for Extension of Time to File Answer , Docket Vol. I, pp. 193 to 196; Order dated December 9, 2019, Docket Vol. I, p. 198; Respondent's Motion for Additional Time to File Answer , Docket Vol. I, pp. 199 to 202; Order dated January 8, 2020, Docket Vol. I, p. 204. 16. Docket Vol. I, pp. 206 to 215. 17. Notice of Pre-Trial Conference dated February 27, 2020, Docket Vol. I, pp. 221 to 222. 18. Docket Vol. I, pp. 223 to 225. 19. Order dated February 18, 2020, Docket Vol. I, p. 228. 20. Docket Vol. I, pp. 235 to 264. 21. Docket Vol. I, pp. 560 to 563. 22. Order dated, and Minutes of the hearing held on, June 29, 2020, Docket Vol. II, pp. 564 to 565. 23. Docket Vol. II, pp. 583 to 584. 24. Docket Vol. II, p. 592. 25. Docket Vol. II, pp. 610 to 612. 26. Exhibit "P-75", Docket Vol. I, pp. 270 to 559; Minutes of the hearing held on, and Order dated, October 14, 2020, Docket Vol. II, pp. 626 to 627. 27. Exhibit "P-470", Docket Vol. II, pp. 655 to 702; Minutes of the hearing held on, and Order dated, February 1, 2021, Docket Vol. II, pp. 703 to 704. 28. Oath of Commission dated October 14, 2020, Docket Vol. II, p. 628; Minutes of the hearing held on, and Order dated, October 14, 2020, Docket Vol. II, pp. 626 to 627. 29. Exhibit "P-77-A". 30. Docket Vol. II, pp. 723 to 754. 31. Docket Vol. II, pp. 979 to 983. 32. Docket Vol. II, p. 991. 33. Docket Vol. II, pp. 985 to 988. 34. Docket Vol. II, pp. 993 to 996. 35. Docket Vol. II, pp. 998 to 1001. 36. Docket Vol. II, pp. 1032 to 1034. 37. Docket Vol. II, pp. 1046 to 1048. 38. Exhibit "R-6", Docket Vol. II, pp. 618 to 622-a; Order dated November 10, 2021, Docket Vol. II, p. 1031. 39. Docket Vol. II, pp. 1036 to 1040. 40. Docket Vol. II, pp. 1042 to 1043. 41. Docket Vol. II, pp. 1046 to 1048. 42. Docket Vol. II, pp. 1049 to 1057. 43. Docket Vol. II, pp. 1059 to 1099. 44. Resolution dated March 14, 2022, Docket Vol. II, p. 1101. 45. Docket Vol. II, pp. 1102 to 1104. 46. Records Verification dated June 7, 2022 issued by the Judicial Records Division of this Court, Docket Vol. II, p. 1126. 47. Docket Vol. II, pp. 1127 to 1130. 48. Petition for Review, p. 6. 49. Id. , p. 8. 50. Id. , p. 8. 51. Id. , p. 9. 52. Id. , p. 12. 53. Id. , p. 13. 54. Id. , p. 15. 55. Id. , p. 22. 56. Id. , p. 25. 57. Id. , pp. 25-26. 58. Id. , p. 26. 59. Id. , p. 26. 60. Id. , p. 26. 61. Id. , p. 26. 62. Id. , p. 27. 63. Id. , p. 27. 64. Id. , p. 27. 65. Id. , pp. 27-28. 66. Id. , p. 28. 67. Id. , p. 29. 68. Id. , pp. 28-29. 69. Id. , p. 27. 70. Id. , p. 28. 71. Answer, p. 2. 72. Id. , p. 4. 73. Id. , p. 4. 74. Id. , p. 6. 75. Id. , p. 6. 76. Id. , p. 8. 77. An Act Expanding the Jurisdiction of the Court of Tax Appeals (CTA), Elevating Its Rank to the Level of a Collegiate Court with Special Jurisdiction and Enlarging Its Membership, Amending for the Purpose Certain Sections of Republic Act No. 1125, as Amended, Otherwise Known as the Law Creating the Court of Tax Appeals, and for Other Purposes, 30 March 2004. 78. An Act Creating the Court of Tax Appeals, June 16, 1954. 79. A.M. No. 05-11-07-CTA, November 22, 2005. 80. Annex "A", Petition for Review. 81. Annex "B", Petition for Review. 82. Section 3. Who May Appeal; Period to File Petition . (a) A party adversely affected by a decision, ruling or the inaction of the Commissioner of Internal Revenue on disputed assessments or claims for refund of internal revenue taxes, or by a decision or ruling of the Commissioner of Customs, the Secretary of Finance, the Secretary of Trade and Industry, the Secretary of Agriculture, or a Regional Trial Court in the exercise of its original jurisdiction may appeal to the Court by petition for review filed within thirty days after receipt of a copy of such decision or ruling, or expiration of the period fixed by law for the Commissioner of Internal Revenue to act on the disputed assessments. In case of inaction of the Commissioner of Internal Revenue on claims for refund of internal revenue taxes erroneously or illegally collected, the taxpayer must file a petition for review within the two-year period prescribed by law from payment or collection of the taxes. 83. Docket Vol. I, pp. 6 to 36. 84. Section 3. Cases within the Jurisdiction of the Court in Divisions . The Court in Divisions shall exercise: (a) Exclusive original or appellate jurisdiction to review by appeal the following: (1) Decisions of the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of internal revenue taxes, fees or other charges, penalties in relation thereto, or other matters arising under the National Internal Revenue Code or other laws administered by the Bureau of Internal Revenue. 85. G.R. Nos. 195175 & 199645, 10 August 2015, 766 SCRA 20-33. 86. Intel Technology Philippines, Inc. vs. Commissioner of Internal Revenue , G.R. No. 155732, April 27, 2007; San Roque Power Corporation vs. Commissioner of Internal Revenue , G.R. No. 180345, November 25, 2009; and AT&T Communications Services Philippines, Inc., G.R. No. 182364, 3 August 2010. 87. Steag State Power, Inc. (Formerly State Power Development Corporation) vs. Commissioner of Internal Revenue , G.R. No. 205282, January 14, 2019; Rohm Apollo Semiconductor Philippines vs. Commissioner of Internal Revenue , G.R. No. 168950, January 14, 2015. 88. Intel Technology Philippines, Inc. vs. Commissioner of Internal Revenue , supra ; San Roque Power Corporation vs. Commissioner of Internal Revenue , supra ; and AT&T Communications Services Philippines, Inc., supra . 89. Id. 90. Id. 91. Id. 92. Id. 93. Intel Technology Philippines, Inc. vs. Commissioner of Internal Revenue , supra ; San Roque Power Corporation vs. Commissioner of Internal Revenue , supra ; and AT&T Communications Services Philippines, Inc., supra . 94. Intel Technology Philippines, Inc. vs. Commissioner of Internal Revenue , supra ; San Roque Power Corporation vs. Commissioner of Internal Revenue , supra ; and AT&T Communications Services Philippines, Inc., supra . 95. Supra at note 10. 96. Supra at note 11. 97. Regulations Implementing the VAT Provisions under the RA No. 10963, Further Amending RR No. 16-2005, as Amended, March 15, 2018. 98. The 90th day from June 28, 2019 is September 26, 2019; Exhibits "P-73-A" and "P-73-B", Docket Vol. I, pp. 556 to 557. 99. Par. 2.3, Petition for Review, Docket Vol. I, p. 7; Exhibits "P-73-A" and "P-73-B", Docket Vol. I, pp. 556 to 557. 100. Docket Vol. I, pp. 6 to 35. 101. Supra at note 7. 102. Supra at note 8. 103. Docket Vol. I, pp. 468 to 469. 104. Docket Vol. I, pp. 480 to 481. 105. Petition for Review, Docket Vol. I, pp. 12 to 13. 106. Petition for Review, Docket Vol. I, pp. 20 to 21. 107. Exhibit "P-162-a"; Pertains to Sales Returns and Adjustment, hence, deducted. 108. Petition for Review, Docket Vol. I, pp. 20 to 21. 109. Sub-Annex "C.4", BIR Records, p. 25. 110. Exhibits "P-451-a" to "P-451-d". 111. Exhibit "P-446". 112. Page 12, Exhibit "P-77". 113. Consolidated Value-Added Tax Regulations of 2005, September 1, 2005. 114. Amending Certain Provisions of Revenue Regulations No. 16-2005, as Amended, Otherwise Known as the Consolidated Value-Added Tax Regulations of 2005, February 7, 2007. 115. Supra at note 113. 116. Commissioner of Internal Revenue v. Port Barton Development Corp. , C.T.A. EB Case No. 1743 (CTA Case No. 8490), January 21, 2019; Oceanagold (Philippines), Inc. v. Commissioner of Internal Revenue , CTA EB Case No. 2358 (CTA Case No. 9112) (Resolution), June 21, 2022. 117. Exhibits "P-172-a" to "P-431-a". 118. Exhibits "P-442-a" to "P-442-bcc". 119. Exhibits "P-441-a" to "P-441-auk". 120. Exhibits "P-438-a" to "P-438-ad". 121. Exhibits "P-439-a" to "P-439-aa". 122. Sub-Annex "C.4", BIR Records, p. 25. 123. Exhibit "P-13", Docket Vol. I, pp. 408 to 414. 124. Exhibit "P-13-A", Docket Vol. I, pp. 415 to 423. 125. Annex "C" of Exhibit "R-3", BIR Records, pp. 47 & 56. 126. Sub-Annex "C.4", BIR Records, p. 25. 127. Table V-2, Exhibit "P-77", p. 32. 128. Table V-3, Exhibit "P-77", pp. 32 to 95. 129. Table V-4, Exhibit "P-77", pp. 95 to 101. 130. Table V-5, Exhibit "P-77", p. 101. 131. Table V-6, Exhibit "P-77", p. 101. 132. Exhibit "P-172-a". 133. Exhibit "P-442-a". 134. Table V-6, Exhibit "P-77", p. 101. 135. Sub-Annex "C.4", BIR Records, p. 25. 136. Refer to Exhibit "R-2", BIR Records (Exhibit "R-5"), p. 22. 137. "P-157.1-a" to "P-157.1-ns"; "P-157.2-a" to "P-157.2-l"; "P-158-a" to "P-158-aj"; "P-160-a" to "P-160-h"; "P-162-a" to "P-162-e". 138. Exhibit "P-163". 139. Docket Vol. II, p. 674. 140. G.R. No. 236325, September 16, 2020. 141. P47,168,559.47 + P17,800.00. 142. G.R. Nos. 158885 & 170680, April 2, 2009. 143. Exhibits "P-450-c", "P-29"/"P-450-e", "P-35"/"P-450-g", and "P-450-k". 144. With discrepancy of P0.01. 145. Exhibit "P-69", Docket Vol. I, pp. 539 to 551. 146. Exhibit "R-5", BIR Records, p. 47. 147. Exhibits "P-170-a" to "P-170-l". 148. Exhibits "P-78-a" to "P-155-b". 149. See Exhibit "P-77", pp. 7, 12 to 14. 150. Exhibit "P-77", pp. 5 to 6. 151. Petition for Review , Docket Vol. I, at pp. 32 and 33. 152. To properly determine petitioner's refundable amount, we shall consider the valid input VAT in its entirety, i.e. , the total valid input VAT as per BIR's findings (P1,422,392,553.50) and this Court's findings (P5,490,260.77). 153. Line 15B, Exhibit "P-450-a". 154. Line 15B, Exhibit "P-450-e". 155. Line 15B, Exhibit "P-450-g". 156. Line 15B, Exhibit "P-450-k". 157. G.R. No. 215159, July 5, 2022. 158. Exhibit "P-450-m", Line 23D. 159. FY ending March 2018 Input Tax allocable to Exempt Sales Exhibit (Line 23C) 1st Quarter P3,387,096.62 "P-450-a" 2nd Quarter 3,879,258.45 "P-450-e" 3rd Quarter 6,174,493.83 "P-450-g" 4th Quarter 5,785,185.18 "P-450-k" Total P19,226,034.08 160. The Revised Consolidated Schedule of Compromise Penalties for Violations of the National Internal Revenue Code. 161. The Philippines International Fair, Inc. vs. The Collector of Internal Revenue, et al. , G.R. L-1298 and L-12932, March 31, 1962, 4 SCRA 781. 162. Commissioner of Internal Revenue v. Lianga Bay Logging Co., Inc. , G.R. L-35266, January 21, 1991, 193 SCRA 92-93. 163. Philippine Gold Processing and Refining Corp. vs. Commissioner of Internal Revenue , G.R. No. 222904 (Notice), July 15, 2020. 164. Commissioner of Internal Revenue vs. San Roque Power Corp. , G.R. Nos. 187485, 196113 & 197156, 12 February 2013, 703 SCRA 310-434. 165. Winebrenner & Iigo Insurance Brokers, Inc. v. Commissioner of Internal Revenue , G.R. No. 206526, January 28, 2015, 752 SCRA 375-412. BACORRO-VILLENA, J.: 1. CTA EB No. 2541 (CTA Case No. 9537), 27 April 2023. 2. G.R. No. 215159, 05 July 2022. 3. Supra at note 2; Citation omitted and emphasis supplied. 4. SEC. 4.110-4. Apportionment of Input Tax on Mixed Transactions . . . . xxx xxx xxx Illustration : ERA Corporation has the following sales during the month: Sale to private entities subject to 12% P100,000.00 Sale to private entities subject to 0% 100,000.00 Sale of exempt goods 100,000.00 Sale to gov't. subjected to 5% final VAT Withholding 100,000.00 Total Sales for the month P400,000.00 ========= The following input taxes were passed on by its VAT suppliers: Input tax on taxable goods 12% P5,000.00 Input tax on zero-rated sales 3,000.00 Input tax on sale of exempt goods 2,000.00 Input tax on sale to government 4,000.00 Input tax on depreciable capital good not attributable to any specific activity (monthly amortization for 60 months) 20,000.00 xxx xxx xxx B. The input tax attributable to zero-rated sales for the month shall be computed as follows : Input tax directly attributable to zero-rated sale P3,000.00 Ratable portion of the input tax not directly attributable to any activity: Taxable sales (0%) x Input tax not directly attributable to any activity Amount of Total Sales P100,000.00 x P20,000.00 P5,000.00 400,000.00 Total input tax attributable to zero-rated sales for the month P8,000.00 ======= 5. Consoli d ated Value-Added Tax Regulations of 2005. 6. Amending Cert ain Provisions of Rev enue Regulations No. 16-2005, as Amended, Otherwise Known as the Consoli dated Value-Added Tax Regulat ions of 2005, Reve nue Regul ations No. 04-07.