Deutsche Knowledge Services Pte Ltd. v. Commissioner of Internal Revenue

FIRST DIVISION [C.T.A. CASE NO. 8243. January 4, 2016.] For: Refund DEUTSCHE KNOWLEDGE SERVICES PTE LTD. , petitioner , vs. COMMISSIONER OF INTERNAL REVENUE , respondent . DECISION MINDARO-GRULLA , J p : This is a Petition for Review filed on March 25, 2011 by Deutsche Knowledge Services Pte Ltd. as petitioner, against Commissioner of Internal Revenue as respondent, before the Court in Division, pursuant to Section 7 (a) (2) of Republic Act (RA) No. 1125, An Act Creating the Court of Tax Appeals, as amended, 1 as well as Rule 4, Section 3 (a) (2), in relation to Rule 8, Section 4 (a) of the Revised Rules of the Court of Tax Appeals (RRCTA), 2 as amended. Petitioner seeks the refund of the amount of P58,385,248.41, allegedly representing its excess and unutilized input value-added tax (VAT) on purchases of goods and services attributable to zero-rated sales for the first quarter of calendar year 2009. Petitioner Deutsche Knowledge Services Pte Ltd. is the Philippine branch of a multinational company organized and existing under and by virtue of the laws of Singapore, with registered office address at One Raffles Quay, #17-10 South Tower, Singapore 048583. 3 It was registered with the Bureau of Internal Revenue (BIR) on June 16, 2005 as a VAT taxpayer with Taxpayer Identification No. (TIN) 238-763-115-000. 4 Petitioner is licensed to do business as a regional operating headquarters (ROHQ) in the Philippines, engaging in general administration and planning, business planning and coordination, sourcing/procurement of raw materials and components, corporate finance advisory services, marketing control and sales promotion, training and personnel management, logistic services, research and development services and product development, technical support and maintenance, data processing, and communication and business development. 5 Moreover, petitioner acts as a shared services center, which handles regional, as well as global and accounting and related controlling processes, such as accounting production work in the global general ledger in SAP, developing and operating inter-company clearing house, accounting and head office reporting for non-regulated entities and product control. 6 Respondent is the duly appointed Commissioner of the Bureau of Internal Revenue empowered to perform the duties of her office, including, among others, the duty to act upon and approve claims for refund or tax credit as provided by law. She holds office at the 5th Floor, BIR National Office Building, Agham Road, Diliman, Quezon City. CAIHTE Petitioner entered into several IntraGroup Service Agreements ("Service Agreements" for brevity) with its foreign clients. 7 On April 22, 2009, petitioner filed its original Quarterly VAT Return 8 for the first quarter of calendar year 2009 with the BIR Revenue District Office (RDO) No. 47. On October 28, 2010, petitioner filed its Application for Tax Credits/Refunds (BIR Form No. 1914) 9 and administrative claim for refund or issuance of tax credit certificate. 10 The administrative claim for refund or issuance of tax credit certificate purportedly represented the unutilized input VAT attributable to its zero-rated sales of services to its foreign clients for the first quarter of calendar year 2009. There being no action taken by respondent on petitioner's administrative claim for refund or issuance of tax credit certificate, petitioner filed the present Petition for Review before this Court on March 25, 2011. In her Answer 11 filed on May 2, 2011, respondent interposed the following Special and Affirmative Defenses: "4. Petitioner's alleged claim for issuance of tax credit certificate is still subject to administrative routinary investigation/examination by the respondent's Bureau; 5. Taxes paid and collected are presumed to have been made in accordance with law, hence, not refundable. 6. Petitioner's claim for refund or issuance of tax credit certificate in the amount of P58,385,248.41 , as alleged excess and unutilized input VAT on purchases of goods and services attributable to its zero-rated sales for the 1st quarter of taxable year 2009 were not fully substantiated by proper documents, such sales invoices, official receipts and others. 7. In an action for refund/credit, the burden of proof is upon petitioner to establish its right to the claimed refund and failure to adduce sufficient proof is fatal to its claim. 8. Petitioner's sales of goods and services to various alleged clients/affiliates do not qualify as zero-rated VAT. 9. The amount subject of the claim for refund of petitioner does not pertain in full to its input VAT attributable to its zero-rated sales of goods and services for the 1st quarter of taxable year 2009. 10. Petitioner failed to comply with the substantiation requirements under Revenue Regulations No. 7-95 in relation to Sections 113 and 237 of the 1997 Tax Code. 11. Petitioner failed to comply with the conditions/requirements under Section 112(C) of the 1997 Tax Code. Hence, this Honorable Court has no jurisdiction to entertain the instant case. 12. It is incumbent upon petitioner to show that it has complied with the provisions under Section 204 (c) in relation to Section 229 of the Tax Code. Otherwise, its failure to prove the same is fatal to its claim for refund. aScITE 13. Claims for refund are construed strictly against the claimant for the same partakes the nature of exemption from taxation (Commissioner of Internal Revenue vs. Ledesma, 31 SCRA 95) and as such, they are looked upon with disfavor (Western Minolco Corp. vs. Commissioner of Internal Revenue, 124 SCRA 1211) ." Respondent filed her Pre-Trial Brief 12 on May 11, 2011; while petitioner filed its Pre-Trial Brief 13 on May 19, 2011. The Pre-Trial was held on June 3, 2011. 14 Thereafter, as directed by the Court, the parties submitted their Joint Stipulation of Facts and Issues 15 on July 8, 2011 as well as their Supplemental Joint Stipulation of Facts and Issues 16 on July 29, 2011; which were approved by the Court in the Resolution 17 dated August 9, 2011. During trial, petitioner presented and formally offered pieces of documentary and testimonial evidence, 18 sans respondent's comment. 19 In a Resolution 20 dated November 20, 2012, the Court admitted petitioner's Exhibits "A", "B", "C", "D", "E", "F", "G", "G-1", "H", "I", "J", "J-1-a", "J-1" to "J-91", "J-92" to "J-286", "J-287" to "J-342", "J-343" to "J-1521", "J-1522" to "J-1523", "J-1524" to "J-1542", "J-1543" to "J-1546", "J-1547" to "J-1555", "K", "L", "L-1", "O", "O-1", "O-2", "O-3", "O-4", "O-5", "O-6", "O-7", "O-8", "O-9", "O-10", "O-12", "O-14", "O-15", "O-16", "O-17", "O-18", "O-19", "O-20", "O-22", "O-24", "O-25", "O-30", "O-31", "O-32", "O-33", "O-34", "O-35", "O-36", "O-37", "O-38", "O-39", "O-40", "O-44", "O-47", "O-48", "P", "P-2", "P-3", "P-4", "P-5", "P-6", "P-7", "P-8", "P-9", "P-10", "P-11", "P-13", "P-14", "P-16", "P-18", "P-20", "P-21", "P-22", "P-23.1", "P-23.2", "P-23.3", "P-23.4", "P-23.5", "P-23.6", "P-24", "P-25", "P-26", "P-27", "P-29", "P-32", "P-35", "Q", "Q-1", "R", "R-1", "R-1-a", and "R-1-b". Petitioner filed an Urgent Motion for Leave to Present Supplemental Evidence 21 on February 22, 2013, praying for the following: (1) grant petitioner's prayer to present supplemental documentary evidence; (2) set a Commissioner's Hearing for the marking of petitioner's supplemental documentary evidence; and (3) order the deferment of the submission of the parties' respective Memoranda. Respondent filed her Comment/Opposition (To Petitioner's Urgent Motion for Leave to Present Supplemental Evidence) 22 on April 8, 2013. In a Resolution 23 dated May 17, 2013, the Court granted petitioner's Urgent Motion for Leave to Present Supplemental Evidence and ordered the setting of Commissioner's Hearing for the marking of petitioner's supplemental documentary evidence. On July 9, 2013, petitioner filed a Supplemental Formal Offer of Evidence. 24 Respondent failed to file her Comment to petitioner's Supplemental FOE. 25 In a Resolution 26 dated November 13, 2013, petitioner's Exhibits "O-49", "O-50", "O-51", "O-52", "O-53", "O-54", "O-55", "O-56", "O-57", "O-58", "O-59", "O-60", "O-61", "O-62", "O-63", "O-64", "O-65", "O-66", "O-67", "O-69", "O-70", "O-71", "O-72", "O-73", and "S" were admitted; while Exhibit "O-68" was denied admission for failure to correspond with the document described in the Supplemental FOE. On December 10, 2013, 27 petitioner filed a Motion for Reconsideration 28 without respondent's Comment. 29 In a Resolution 30 dated March 17, 2014, the Court granted petitioner's Motion for Reconsideration and admitted Exhibit "O-68". In the said Resolution, the parties were given a period of twenty (20) days from receipt of the Resolution within which to submit their respective Memoranda. Respondent filed her Memorandum 31 on April 10, 2014; while petitioner filed its Memorandum (With Motion to Re-Open Trial) 32 on May 2, 2014, sans respondent's Comment, 33 for the purpose of presenting additional documentary evidence. In a Resolution 34 dated July 3, 2014, the Court granted petitioner's Motion to Re-Open Trial for the sole purpose of presenting additional documentary evidence. On August 22, 2014, petitioner filed a Motion to Admit Supplemental Formal Offer of Evidence with attached Supplemental FOE. 35 Respondent, however, failed to file her Comment on the said Motion. 36 The Court granted petitioner's Motion to Admit Supplemental Formal Offer of Evidence in a Resolution 37 dated November 6, 2014. Respondent still failed to file her Comment on petitioner's Supplemental FOE. 38 In a Resolution 39 dated January 23, 2015, the Court admitted petitioner's Exhibits "J-1556", "J-1557", "J-1558", "J-1559", "T", and "T-1". In the same Resolution, the Court declared the case submitted for decision in view of the filing of petitioner's Memorandum (with Motion to Re-Open Trial) on May 2, 2014 and respondent's Memorandum on April 10, 2014. Exhibit Description A Securities and Exchange Commission (SEC) Certificate of Registration and License (S.E.C. Reg. No. FS2005506950) B Bureau of Internal Revenue (BIR) Certificate of Registration dated June 16, 2005 C Quarterly VAT Return for the 1st Quarter of calendar year (CY) 2009, filed on April 22, 2009 via the BIR's EFPS with reference no. 100900002918295 D Quarterly VAT Return for the 2nd Quarter of CY 2009, filed on July 17, 2009 via the BIR's EFPS with reference no. 100900003099684 E Quarterly VAT Return for the 3rd Quarter of CY 2009, filed on October 19, 2009 via the BIR's EFPS with reference no. 100900003288515 F Quarterly VAT Return for the 4th Quarter of CY 2009, filed on January 25, 2010 via the BIR's EFPS with reference no. 101000003509641 G Quarterly VAT Return for the 1st Quarter of CY 2010, filed on April 21, 2010 via the BIR's EFPS with reference no. 101000003734058 G-1 Amended Quarterly VAT Return for the 1st Quarter of CY 2010, filed on October 17, 2011 via the BIR's EFPS with reference no. 101100005210798 H Quarterly VAT Return for the 2nd Quarter of CY 2010, filed on July 21, 2010 via the BIR's EFPS with reference no. 101000003951054 I Quarterly VAT Return for the 3rd Quarter of CY 2010, filed on October 20, 2010 via the BIR's EFPS with reference no. 101000004171299 J Quarterly VAT Return for the 4th Quarter of CY 2010, filed on January 25, 2011 via the BIR's EFPS with reference no. 101000004425763 J-1-a Amended Quarterly VAT Return for the 4th Quarter of CY 2010, filed on February 10, 2011 via the BIR's EFPS with reference no. 101100004487877 J-1 to J-91 Inward remittance advice and bank statements for the 1st quarter of CY 2009 J-92 to J-286 Service invoices relating to petitioner's zero-rated sales for the 1st quarter of CY 2009 J-287 to J-342 Official receipts relating to petitioner's zero-rated sales for the 1st quarter of CY 2009 J-343 to J-1521 Suppliers' invoices and suppliers' official receipts for the 1st quarter of CY 2009 J-1522 to J-1523 VAT Returns for the CY 2009 J-1524 to J-1542 Audited Financial Statements as of and for the year ended December 31, 2009 J-1543 to J-1546 Certifications issued to petitioner by the SEC and Board of Investments (BOI) certifying the registered activities of petitioner J-1457 to J-1555 BIR Form 1600 (Monthly Remittance Return of VAT and other percentage taxes withheld) J-1556 Inward Remittance with Reference No. 02RS03160017 dated March 16, 2009 for the amount of EUR5,554,074.84 (Php339,648,338.69) J-1557 Inward Remittance with Reference No. 02RS03160026 dated March 16, 2009 for the amount of EUR13,346.38 (Php816,171.18) corresponding to payments for service invoice with reference numbers 2009-SOM TMG APHO-001 (for the amount of EUR2,152.00), 2009-SOM TMG APHO- 002 (for the amount of EUR2,152.00), and INV 08-APHO-0396 J-1558 Service Invoice with Reference No. 2009- SOM TMG APHO-001 for the amount of EUR2,152.00 J-1559 Service Invoice with Reference No. 2009- SOM TMG APHO-002 for the amount of EUR2,152.00 K Quarterly VAT Return for the 1st Quarter of CY 2011, filed on April 25, 2011 via the BIR's EFPS with reference no. 101100004711772 L Administrative Claim for Refund of its unutilized input VAT for the 1st quarter of CY 2009 dated October 27, 2010 and filed with the BIR on October 28, 2010 L-1 Application for Tax Credits/Refunds (BIR Form No. 1914) for the 1st quarter of CY 2009 filed with the BIR on October 28, 2010 O Authenticated Articles of Association of Deutsche Bank Aktiengesellschaft O-1 Authenticated License and Change Location issued by the Banking Department of the State of New York to Deutsche Bank AG, New York Branch O-2 Authenticated Certification from the Registrar of Companies for England and Wales that Deutsche Bank Aktiengesellschaft has established a branch and continues to maintain a branch in England and Wales O-3 Authenticated Certified True Copy of Certificate of Incorporation on Change of Name of Company from Deutsche Morgan Grenfell Asia Pacific Holdings Pte Ltd. to Deutsche Asia Pacific Holdings Pte Ltd. O-4 Authenticated Certified Copy of All Historical Registered Matters pertaining to Deutsche Securities, Inc. based in 11-1 Sanno Park Tower, Nagatacho 2-chome, Chiyoda-ku, Tokyo O-5 Authenticated Certificate of Registration of Oversea Company of Deutsche Bank Aktiengesellschaft, from the Registrar of companies Hong Kong O-6 Authenticated Business Registration (NO.D.15.6.2.30) of Deutsche Bank Aktiengesellschaft, Filiale Jakarta from the Menteri Keuangan, Indonesia O-7 Authenticated Certificate of Registration of Foreign Company of Deutsche Bank Aktiengesellschaft issued by the Acting Registrar of Companies, Singapore O-8 Authenticated Certificate of Incorporation on change of Name of Deutsche Asset Management (Asia) Limited issued by the Assistant Registrar of Companies and Businesses, Singapore O-9 Authenticated Certification from Deutsche Bank Aktiengesellschaft, Asia Pacific Head Office in One Raffles Quay, # 15-00 South Tower, Singapore that it is a segment of Deutsche Bank Ag and that it is not a separate legal entity O-10 Authenticated Certificate of Registration of a Foreign Company of Deutsche Group Services Pty Limited (Australia) O-12 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft, Inlandsbank O-14 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft, Filiale London O-15 Certification of Non-Registration of Corporation/Partnership of Deutsche Asia Pacific Holdings Pte. Ltd. O-16 Certification of Non-Registration of Corporation/Partnership of Deutsche Group Services Pty Limited O-17 Certification of Non-Registration of Corporation/Partnership of Deutsche Securities, Inc. O-18 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft, Filiale Hong Kong O-19 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft, Filiale Jakarta O-20 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft, Filiale Singapur O-22 Certification of Non-Registration of Corporation/Partnership of Deutsche Asset Management (Asia) Limited O-24 Certification of Non-Registration of Corporation/Partnership of DBOI Global Services Private Limited O-25 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft, Filiale Bangkok O-30 Certification of Non-Registration of Corporation/Partnership of DB Finance, Inc. O-31 Certification of Non-Registration of Corporation/Partnership of DB Trust Company Limited Japan O-32 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft, Filiale Prag O-33 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank PBC Spolka Akcyjna O-34 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Luxembourg S.A. O-35 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Trust Company Americas O-36 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank (China) Co. Ltd., Beijing Branch O-37 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Sociedad Anonima Espanola O-38 Certification of Non-Registration of Corporation/Partnership of PT Deutsche Securities Indonesia O-39 Certification of Non-Registration of Corporation/Partnership of DWS Holding & Service GMBH O-40 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft, Filiale Wien from the SEC O-44 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft, Filiale Zurich O-47 Certification of Non-Registration of Corporation/Partnership of Global Markets Centre Private Limited O-48 Certification of Non-Registration of Company of DB International (Asia) Limited P IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, Asia Pacific Head office P-2 Amendment and Accession Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, New York Branch (with attached Service Agreement between the same parties) P-3 IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, Filiale London P-4 IntraGroup Service Agreement between Petitioner and Deutsche Asia Pacific Holdings Pte Ltd. P-5 IntraGroup Service Agreement between Petitioner and Deutsche Group Services Pty Limited P-6 IntraGroup Service Agreement between Petitioner and Deutsche Securities, Inc. P-7 IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, Hongkong Branch P-8 IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft Jakarta Branch P-9 IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft Singapore Branch P-10 IntraGroup Service Agreement between Petitioner and Deutsche Bank (China) Co., Ltd. P-11 IntraGroup Service Agreement between Petitioner and Deutsche Asset Management (Asia) Limited P-13 IntraGroup Service Agreement between Petitioner and DBOI Global Services Private Limited P-14 IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, Filiale Bangkok P-16 IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, Filiale Seoul Branch P-18 IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, Asia Pacific Head Office P-20 IntraGroup Service Level Agreement between Petitioner and DB Trust Company Limited Japan P-21 IntraGroup Service Agreement between Petitioner and Deutsche Bank AG Prague Branch P-22 IntraGroup Service Agreement between Petitioner and Deutsche Bank Polska S.A. P-23.1 IntraGroup Service Agreement between Petitioner and Deutsche Bank AG Luxembourg Branch P-23.2 IntraGroup Service Agreement between Petitioner and DWS Investment S.A. P-23.3 IntraGroup Service Agreement between Petitioner and Deutsche Bank Luxembourg SA P-23.4 IntraGroup Service Agreement between Petitioner and Deutsche Bank Re S.A. P-23.5 IntraGroup Service Agreement between Petitioner and Deutsche Bank Vita S.A. P-23.6 IntraGroup Service Agreement between Petitioner and Primelux Insurance P-24 IntraGroup Service Agreement between Petitioner and Deutsche Bank (China) Co. Ltd. Beijing Branch P-25 IntraGroup Service Agreement between Petitioner and Deutsche Bank SAE (Sociedad Anonima Espaola) P-26 IntraGroup Service Agreement between Petitioner and Deutsche Securities Indonesia P-27 IntraGroup Service Agreement between Petitioner and DWS Holding & Service GmbH P-29 Deutsche Bank List of Shareholdings 2008 P-32 IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, Filiale Zurich P-35 IntraGroup Service between Petitioner and Deutsche Bank Aktiengesellschaft, Filiale Zurich Q Sworn Statement of Mr. Romeo A. De Jesus to Questions propounded by Atty. Marvin B. Ibarra dated October 25, 2011 Q-1 Signature of Mr. Romeo A. De Jesus R Petitioner's Independent CPA Report dated September 22, 2011 R-1 Signature of Mr. Romeo A. De Jesus R-1-a Sworn Statement of Ms. Rachel Concepcion to Questions propounded by Atty. Marvin B. Ibarra dated January 27, 2012 R-1-b Signature of Ms. Rachel Concepcion T Supplemental Sworn Statement of Mr. Romeo A. De Jesus, Jr. to Questions Propounded by Atty. Marvin B. Ibarra dated August 6, 2014 T-1 Signature of Romeo A. De Jesus, Jr. The parties submitted the following issue 40 for this Court's resolution: WHETHER OR NOT PETITIONER IS ENTITLED TO THE CLAIM FOR REFUND OF OR ISSUANCE OF TAX CREDIT CERTIFICATE OF EXCESS OR UNUTILIZED INPUT VAT IN THE AMOUNT OF PHP58,385,248.41. The main issue may be broken down into the following sub-issues: A. WHETHER OR NOT PETITIONER INCURRED INPUT VAT ON ITS PURCHASES OF GOODS AND SERVICES ATTRIBUTABLE TO ZERO-RATED SALES FOR THE 1ST QUARTER OF CY 2009. aDSIHc B. WHETHER OR NOT THE AMOUNT OF PHP58,385,248.41, BEING CLAIMED BY PETITIONER AS UNUTILIZED INPUT VAT PAID, FOR THE 1ST QUARTER OF CY 2009, PERTAINS IN FULL TO ITS ZERO-RATED SALES OF GOODS AND SERVICES. C. WHETHER OR NOT PETITIONER HAD ZERO-RATED SALES DURING THE 1ST QUARTER OF CY 2009, THE CONSIDERATION FOR WHICH IS PAID FOR IN ACCEPTABLE FOREIGN CURRENCY AND ACCOUNTED FOR IN ACCORDANCE WITH THE RULES AND REGULATIONS OF THE BSP. D. WHETHER OR NOT THE INPUT VAT INCURRED BY PETITIONER FOR THE 1ST QUARTER OF CY 2009 IS DULY SUPPORTED BY VAT INVOICES AND OFFICIAL RECEIPTS. E. WHETHER OR NOT THE INPUT VAT INCURRED BY PETITIONER FOR THE 1ST QUARTER OF CY 2009 AMOUNTING TO PHP58,385,248.41 WAS APPLIED AGAINST ANY OUTPUT VAT OR CARRIED OVER TO SUCCEEDING TAXABLE PERIODS. F. WHETHER OR NOT PETITIONER'S ADMINISTRATIVE AND JUDICIAL CLAIMS FOR REFUND OR ISSUANCE OF TCC FOR ITS EXCESS AND UNUTILIZED INPUT VAT ON PURCHASES OF CAPITAL GOODS, NON-CAPITAL GOODS AND SERVICES ATTRIBUTABLE TO ITS ZERO-RATED SALES WERE FILED WITHIN THE TWO-YEAR PERIOD PRESCRIBED UNDER SECTIONS 110, 112 AND 229, TAX CODE. G. WHETHER OR NOT PETITIONER HAS COMPLIED WITH THE INVOICING REQUIREMENTS PRESCRIBED UNDER REVENUE REGULATIONS NO. 7-95 IN RELATION TO SECTIONS 113 AND 237 OF THE TAX CODE. H. WHETHER OR NOT PETITIONER HAS COMPLIED WITH THE REQUIREMENTS UNDER SECTION 112(A)(B)(C) OF THE TAX CODE. Petitioner alleges that during the first quarter of calendar year 2009, it rendered services in the Philippines to persons engaged in business conducted outside the Philippines, the payments for which were made in Euro and other acceptable foreign currency and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP). 41 Petitioner further claims that it accumulated excess input VAT in the amount of P58,385,248.41 attributable to its zero-rated sales, which remains unutilized and/or unapplied against its output tax liability. 42 Petitioner thus contends 43 that it is entitled to a refund of the said input VAT attributable to its zero-rated sales for the first quarter of calendar year 2009 pursuant to Sections 108 (B) (2) and 112 (A), in relation to Section 110 (B) of National Internal Revenue Code (NIRC) of 1997, as amended, which are quoted hereunder for easy reference: "SEC. 108. Value-added Tax on Sale of Services and Use or Lease of Properties . xxx xxx xxx (B) Transactions Subject to Zero Percent (0%) Rate. The following services performed in the Philippines by VAT-registered persons shall be subject to zero percent (0%) rate: xxx xxx xxx (2) Services other than those mentioned in the preceding paragraph rendered to a person engaged in business conducted outside the Philippines or to a nonresident person not engaged in business who is outside the Philippines when the services are performed, the consideration for which is paid for in acceptable foreign currency and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP);" "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." "SEC. 110. Tax Credits. xxx xxx xxx (B) Excess Output or Input Tax. If at the end of any taxable quarter the output tax exceeds the input tax, the excess shall be paid by the VAT-registered person. If the input tax exceeds the output tax, the excess shall be carried over to the succeeding quarter or quarters: . . . Provided, however , That any input tax attributable to zero-rated sales by a VAT-registered person may at his option be refunded or credited against other internal revenue taxes, subject to the provisions of Section 112." Based on the above-quoted provisions, in order to be entitled to a refund or tax credit of input VAT payments attributable to zero-rated or effectively zero-rated sales, the following requisites must be satisfied: ETHIDa 1. that the taxpayer must be VAT-registered; 2. that there must be zero-rated or effectively zero-rated sales; 3. that input taxes were incurred or paid; 4. that such input VAT payments are directly attributable to zero-rated sales or effectively zero-rated sales; 5. that the input VAT payments were not applied against any output VAT liability; and 6. that the claim for refund was filed within the two-year prescriptive period. Before discussing the other requisites mentioned in the preceding paragraph, the Court shall first rule on the timeliness of the filing of the instant claim. Respondent alleges that petitioner failed to comply with the conditions or requirements under Section 112 (C) of the NIRC of 1997, as amended, which would mean that this Court has no jurisdiction to entertain the instant case. 44 In Commissioner of Internal Revenue vs. Aichi Forging Company of Asia, Inc. , 45 the Supreme Court explained that in case of tax refunds under Section 112 of the NIRC of 1997, as amended, the phrase "within two years" applies only to the filing of the administrative claim for refund and not to the filing of the judicial claim. The pertinent portions of the decision are quoted as follows: "There is nothing in Section 112 of the NIRC to support respondent's view. Subsection (A) of the said provision states that 'any VAT-registered person, whose sales are zero-rated or effectively zero-rated may, within two 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.' The phrase 'within two (2) years . . . apply for the issuance of a tax credit certificate or refund' refers to applications for refund/credit filed with the CIR and not to appeals made to the CTA. This is apparent in the first paragraph of subsection (D) of the same provision, which states that the CIR has '120 days from the submission of complete documents in support of the application filed in accordance with Subsections (A) and (B)' within which to decide on the claim. In fact, applying the two-year period to judicial claims would render nugatory Section 112(D) of the NIRC, which already provides for a specific period within which a taxpayer should appeal the decision or inaction of the CIR. The second paragraph of Section 112(D) of the NIRC envisions two scenarios: (1) when a decision is issued by the CIR before the lapse of the 120-day period; and (2) when no decision is made after the 120-day period. In both instances, the taxpayer has 30 days within which to file an appeal with the CTA. As we see it then, the 120-day period is crucial in filing an appeal with the CTA." Accordingly, petitioner had two years from the close of the first quarter of calendar year 2009, or until March 31, 2011, within which to file its administrative claim with respondent. Evidently, petitioner timely filed its refund claim with the BIR on October 28, 2010. 46 As regards petitioner's judicial claim, the applicable provision is Section 112 (C) of the NIRC of 1997, as amended, which reads as follows: "SEC. 112. Refunds or Tax Credits of Input Tax. xxx xxx xxx (C) Period within which Refund or Tax Credit of Input Taxes shall be Made. In proper cases, the Commissioner shall grant a refund or issue the tax credit certificate for creditable input taxes within one hundred twenty (120) days from the date of submission of complete documents in support of the application filed in accordance with Subsection (A) hereof. In case of full or partial denial of the claim for tax refund or tax credit, or the failure on the part of the Commissioner to act on the application within the period prescribed above, the taxpayer affected may, within thirty (30) days from the receipt of the decision denying the claim or after the expiration of the one hundred twenty day-period, appeal the decision or the unacted claim with the Court of Tax Appeals." Based on the foregoing, the taxpayer may appeal to this Court within thirty (30) days from receipt of the decision or from inaction of respondent after the lapse of one hundred twenty (120) days from the filing of its administrative claim for refund. In this case, respondent failed to act on petitioner's claim filed on October 28, 2010 within the prescribed period, or until February 25, 2011. Thus, petitioner had thirty (30) days from February 25, 2011, or until March 27, 2011, within which to file with this Court its appeal of respondent's inaction. Accordingly, this Petition for Review filed on March 25, 2011 is well within the prescriptive period allowed by law. The Court shall now proceed to determine the merits of petitioner's claim for refund or tax credit. Petitioner maintains that its sales of services to entities engaged in business conducted outside of the Philippines constitute zero-rated sales. In the case of Commissioner of Internal Revenue vs. Burmeister and Wain Scandinavian Contractor Mindanao, Inc. , 47 the Supreme Court held that in order for the supply of services to be VAT zero-rated under Section 102 (B) (2) [now Section 108 (B) (2)] of the NIRC of 1997, as amended, the following requisites must be satisfied: 1. the services must be other than processing, manufacturing or repacking of goods; 2. the payment for such services must be in acceptable foreign currency accounted for in accordance with the BSP rules and regulations; and 3. the recipient of such services must be doing business outside the Philippines. It is undisputed that petitioner is licensed to do business as ROHQ in the Philippines to engage in general administration and planning, business planning and coordination, sourcing/procurement of raw materials and components, corporate finance advisory services, marketing control and sales promotion, training and personnel management, logistic services, research and development services and product development, technical support and maintenance, data processing and communication and business development. 48 Petitioner likewise acts as a shared services center, which handles regional, as well as global and accounting and related controlling processes, such as accounting production work in the global general ledger in SAP, developing and operating inter-company clearing house, accounting and head office reporting for non-regulated entities and product control. 49 Evidently, the services provided by petitioner are not in the same category as "processing, manufacturing or repacking of goods". For services rendered during the first quarter of calendar year 2009, petitioner received foreign currency payments (in Euro) which were accounted for in accordance with the BSP rules and regulations, as evidenced by sales invoices 50 and official receipts 51 issued by petitioner to its alleged non-resident foreign clients, various inward remittance advices, and bank statements. 52 cSEDTC To prove that petitioner rendered services to entities/affiliates engaged in business conducted outside the Philippines, it presented the following documents: (a) SEC Certificates of Non-Registration of Company; 53 (b) Various registration documents ( i.e. , AMI.net Company Profile Fact Sheet, Authenticated Articles of Association, Certificate of Registration, and Certificate of Incorporation on Change of Name of Company); 54 and (c) Intragroup Service Agreements. 55 However, this Court finds that each of the aforesaid documents, standing alone, is an inadequate proof that petitioner's client is a non-resident foreign corporation doing business outside the Philippines. While the SEC Certificates of Non-Registration show that the named entities therein are not registered corporations/partnerships in the Philippines, the same do not prove that such entities are non-resident foreign corporations doing business outside the Philippines. Likewise, the Certificate of Association and Certificates of Registration/Incorporation of Foreign Company only prove that the named entities therein were incorporated/organized abroad but do not establish that such entities are not doing business in the Philippines. Also, the Service Agreements only show the names of petitioner's customers to whom it rendered services but the same do not establish that such customers are non-resident foreign corporations doing business outside the Philippines. To be considered as non-resident foreign corporation doing business outside the Philippines, each entity must be supported, at the very least, by both SEC Certificate of Non-Registration of Corporation/Partnership and Certificate/Articles of Foreign Incorporation/Association/Registration. Thus, only the following clients of petitioner shall be considered as non-resident foreign corporations doing business outside the Philippines: Entity Client SEC Certificate AMI.net Code 56 of Non- Company Profile Registration Fact Sheet, Articles of Association, Certificate of Registration, and Certification of Incorporation on Change of Name of Company 100 Deutsche Bank Aktiengesellschaft, Inlandsbank O-12 O-49 743 Deutsche Bank Sociedad Annima Espaola O-37 O-50 744 Deutsche Bank Aktiengesellschaft, Filiale Zrich O-44 O-51 747 Deutsche Bank Aktiengesellschaft, Filiale Wien O-40 O-52 781 Deutsche Bank Aktiengesellschaft, Filiale Singapur O-20 O-7 783 Deutsche Bank Aktiengesellschaft, Filiale Bangkok O-25 O-53 786 Deutsche Bank Aktiengesellschaft, Filiale Hongkong O-18 O-5 788 Deutsche Bank Aktiengesellschaft, Filiale Jakarta O-19 O-6 801 Deutsche Asset Management (Asia) Limited O-22 O-8 840 Deutsche Bank Aktiengesellschaft, Filiale London O-14 O-55 845 Deutsche Bank Aktiengesellschaft, Filiale Prag O-32 O-56 871 Deutsche Bank Luxembourg S.A. O-34 O-57 872 Deutsche Securities, Inc. O-17 O-4 910 Deutsche Bank (China) Co. Ltd., Beijing Branch O-36 O-59 935 DWS Holding & Service GmbH O-39 O-60 5046 Deutsche Asia Pacific Holdings Pte Ltd. O-15 O-3 5157 PT Deutsche Securities Indonesia O-38 O-61 5180 Deutsche Group Services Pty Limited O-16 O-10 5735 Deutsche Bank PBC Spolka Akcyjna O-33 O-62 6201 Deutsche Bank Trust Company Americas O-35 O-63 6502 DB Finance, Inc. O-30 O-64 6518 DB Trust Company Limited Japan O-31 O-65 6822 DB International (Asia) Limited O-48 O-66 9478 DBOI Global Services Private Limited O-24 O-67 9608 Global Markets Centre Private Limited O-47 O-68 Accordingly, petitioner's sales of services to the afore-mentioned entities for the first quarter of calendar year 2009 in the amount of 4,634,848.23 with peso equivalent of P289,872,951.07, as presented below, qualify for VAT zero-rating under Section 108 (B) (2) of the NIRC of 1997, as amended: SDAaTC Inward Remittance Official Receipt Entity Exhibit No. Amount Exhibit Amount Code No. 5180 J3 12,541.00 J289 P787,073.91 845 J5 925.00 J287 60,012.77 6502 J7 1,388.00 J290 87,805.24 6518 J8 1,388.00 J291 89,671.27 5180 J12 4,464.00 J293 280,165.95 786 J14 665,050.31 J294 40,970,510.83 910 J16 18,500.00 J295 1,133,649.85 910 J17 18,500.00 J296 1,133,649.85 788 J19 16,650.00 J298 1,070,275.32 872 J20 911,272.00 J297 56,175,316.96 5180 J22 11,200.00 J299 679,119.84 5735 J24 463.00 J300 28,146.00 5157 J26 1,850.00 J301 118,110.62 840 J28 102,966.00 J302 6,464,764.79 840 J30 142,311.00 J303 8,935,084.06 840 J34 80,000.00 J305 5,022,838.10 840 J37 127,751.60 J307 8,020,945.05 6201 J41 1,425.00 J309 86,309.97 6201 J43 688.00 J310 41,632.26 781 J47 25,000.00 J312 1,549,353.33 747 J54 925.00 J316 58,762.88 100 J56 1,752,962.93 J317 109,884,954.58 781 J61 16,174.71 J321 989,132.04 840 J67 98,686.00 J324 6,196,057.88 845 J69 925.00 J327 60,012.77 801 J70 87,500.07 J328 5,697,165.43 935 J71 18,500.04 J329 1,204,545.19 9478 J73 77,050.00 J330 5,081,412.87 747 J74 647.00 J331 41,102.26 5157 J75 1,850.00 J332 113,133.05 743 J76 27,750.06 J333 1,830,103.97 6518 J77 1,387.50 J334 89,638.97 840 J79 84,991.00 J335 5,336,173.87 783 J81 18,500.04 J336 1,209,926.30 6822 J83 46,250.10 J338 2,994,365.14 6822 J84 123,233.87 J339 7,978,516.89 9608 J85 5,551.00 J340 359,387.78 840 J86 126,984.00 J337 7,972,750.92 871 J91 647.00 J342 41,372.31 TOTAL 4,634,848.23 P289,872,951.07 ============= ============= The rest of petitioner's declared zero-rated sales in the amount of P863,838,977.32, that is P1,153,711,928.39 less P289,872,951.07, shall be denied VAT zero-rating for petitioner's failure to prove that the entities to whom it rendered services are non-resident foreign corporations doing business outside the Philippines. Petitioner asserts that its input VAT for the first quarter of calendar year 2009 in the amount of P58,385,248.41, as shown below, are duly substantiated by appropriate documentary evidence and are attributable to its zero-rated sales: Input VAT from Current Transactions Purchase of Capital Goods not exceeding P1 Million P4,464.22 Purchase of Capital Goods exceeding P1 Million 1,500,608.79 Domestic Purchases of Goods Other than Capital Goods 1,190,633.97 Domestic Purchases of Services 51,943,810.08 Services Rendered by Non-Residents 3,745,731.35 Total Input VAT per Return P58,385,248.41 ============ In support of its claim, petitioner presented various invoices and official receipts issued by its suppliers, BIR Form 1600, and other documents, 57 which were all examined by the Independent Certified Public Accountant (ICPA). The latter noted the following exceptions, which this Court finds in order; thus, shall be disallowed from petitioner's claim: 58 Annex Findings Disallowed Input VAT A.1 Purchase of goods not supported by supplier's sales invoices P36,533.57 A.2 Purchase of services not supported by supplier's official receipts 4,148,408.27 A.3 Input VAT on purchases with invalid supporting documents 477,787.39 A.4 Purchase of goods and services not within the 1st quarter of CY 2009 503,290.09 Total P5,166,019.32 =========== In addition, the input VAT of P41,000,124.19, as detailed below, shall be disallowed for petitioner's failure to meet the substantiation requirements under Sections 110 (A) and 113 (A) and (B) of the NIRC of 1997, as amended by Republic Act (RA) No. 9337, and as implemented by Sections 4.110-2, 4.110-3, 4.110-8 and 4.113-1 of Revenue Regulations (RR) No. 16-05: Exhibit Supplier Invoice/ Disallowed Input Official Receipt VAT No. 1. Input VAT not separately indicated in the supporting invoices or official receipts J370 Ambassador Home and Electronics Center 83521 P238.93 J388 JJED Philippines, Inc. 66493 7,373.46 J389 JJED Philippines, Inc. 66848 8,276.25 J393 Michigan Enterprises Corporation 14730 7,232.14 J394 Michigan Enterprises Corporation 14731 10,285.71 J502 6-24 Property Holdings, Inc. 134 2,049,996.96 J503 6-24 Property Holdings, Inc. 204 372,726.72 J504 6-24 Property Holdings, Inc. 205 1,384,566.21 J505 6-24 Property Holdings, Inc. 217 2,049,996.96 J506 6-3 Property Holdings, Inc. 635 977,894.04 J509 6-3 Property Holdings, Inc. 648 2,081.88 J510 6-3 Property Holdings, Inc. 681 171,590.94 J511 A. Soriano Corporation 19217 454,100.17 J513 ACCRALAW 34999 28.07 J515 ACCRALAW 34998 120.00 J516 ACCRALAW 34997 720.00 J519 Air2100, Inc. 42055 278.28 J520 Air2100, Inc. 42061 283.76 J532 American Express Transnational, Inc. 39806 15,845.09 J533 Asia Select, Inc. 4605 1,431.76 J534 Asia Select, Inc. 4606 1,149.03 J535 Asia Select, Inc. 4629 2,522.83 J536 Asia Select, Inc. 4674 1,071.33 J537 Asia Select, Inc. 4697 1,348.83 J538 Asia Select, Inc. 4776 1,128.91 J539 Audioman Enterprises 28622 482.14 J540 Audioman Enterprises 28664 1,232.14 J541 Audioman Enterprises 28713 5,357.14 J542 Audioman Enterprises 28683 535.71 J543 Autohome Business Solutions, Inc. 973 4,217.48 J544 Autohome Business Solutions, Inc. 938 1,899.24 J545 Autohome Business Solutions, Inc. 836 4,217.48 J546 Autohome Business Solutions, Inc. 939 6,358.36 J547 Barrington Carpets, Inc. 11276 1,449,815.15 J548 Bayan Telecommunications, Inc. 297585 182.04 J549 Bayan Telecommunications, Inc. 297654 182.04 J550 Bayan Telecommunications, Inc. 306127 182.04 J552 Bayan Telecommunications, Inc. 297597 182.04 J553 Bayan Telecommunications, Inc. 305617 182.04 J555 Bayan Telecommunications, Inc. 279282 182.04 J556 Bayan Telecommunications, Inc. 297652 182.04 J557 Bayan Telecommunications, Inc. 306146 182.04 J559 Bayan Telecommunications, Inc. 279275 182.04 J560 Bayan Telecommunications, Inc. 297598 182.04 J561 Bayan Telecommunications, Inc. 306124 182.04 J563 Bayan Telecommunications, Inc. 306120 182.04 J564 Bayan Telecommunications, Inc. 279276 182.04 J565 Bayan Telecommunications, Inc. 297599 182.04 J566 Bayan Telecommunications, Inc. 305607 182.04 J568 Bayan Telecommunications, Inc. 306137 182.04 J570 Bayan Telecommunications, Inc. 297656 182.04 J571 Bayan Telecommunications, Inc. 305635 182.04 J573 Bayan Telecommunications, Inc. 279271 182.04 J577 Bayan Telecommunications, Inc. 297593 182.04 J578 Bayan Telecommunications, Inc. 305632 182.04 J580 Bayan Telecommunications, Inc. 297653 182.04 J581 Bayan Telecommunications, Inc. 306125 182.04 J583 Bayan Telecommunications, Inc. 297670 182.04 J584 Bayan Telecommunications, Inc. 306126 182.04 J586 Bayan Telecommunications, Inc. 297657 182.04 J587 Bayan Telecommunications, Inc. 305619 182.04 J589 Bayan Telecommunications, Inc. 279270 182.04 J590 Bayan Telecommunications, Inc. 297658 182.04 J591 Bayan Telecommunications, Inc. 305609 182.04 J593 Bayan Telecommunications, Inc. 297580 182.04 J594 Bayan Telecommunications, Inc. 306148 182.04 J596 Bayan Telecommunications, Inc. 279264 182.04 J597 Bayan Telecommunications, Inc. 297672 182.04 J598 Bayan Telecommunications, Inc. 306134 182.04 J600 Bayan Telecommunications, Inc. 279269 182.04 J601 Bayan Telecommunications, Inc. 297651 182.04 J602 Bayan Telecommunications, Inc. 306121 182.04 J604 Bayan Telecommunications, Inc. 297579 182.04 J605 Bayan Telecommunications, Inc. 305616 182.04 J607 Bayan Telecommunications, Inc. 279263 182.04 J608 Bayan Telecommunications, Inc. 297676 182.04 J609 Bayan Telecommunications, Inc. 306122 182.04 J611 Bayan Telecommunications, Inc. 297581 182.04 J612 Bayan Telecommunications, Inc. 306133 182.04 J614 Bayan Telecommunications, Inc. 297662 182.04 J615 Bayan Telecommunications, Inc. 305613 182.04 J617 Bayan Telecommunications, Inc. 306141 182.04 J618 Bayan Telecommunications, Inc. 279277 182.04 J619 Bayan Telecommunications, Inc. 306144 182.04 J620 Bayan Telecommunications, Inc. 306142 182.04 J622 Bayan Telecommunications, Inc. 279283 182.04 J623 Bayan Telecommunications, Inc. 297661 182.04 J624 Bayan Telecommunications, Inc. 305622 182.04 J626 Bayan Telecommunications, Inc. 297594 182.04 J627 Bayan Telecommunications, Inc. 305633 182.04 J629 Bayan Telecommunications, Inc. 279281 182.04 J630 Bayan Telecommunications, Inc. 297565 182.04 J631 Bayan Telecommunications, Inc. 297566 182.04 J632 Bayan Telecommunications, Inc. 305634 182.04 J634 Bayan Telecommunications, Inc. 279261 182.04 J635 Bayan Telecommunications, Inc. 297595 182.04 J636 Bayan Telecommunications, Inc. 305614 182.04 J638 Bayan Telecommunications, Inc. 297582 182.04 J639 Bayan Telecommunications, Inc. 306130 182.04 J641 Bayan Telecommunications, Inc. 279262 182.04 J642 Bayan Telecommunications, Inc. 297568 182.04 J643 Bayan Telecommunications, Inc. 306131 182.04 J645 Bayan Telecommunications, Inc. 297577 182.04 J646 Bayan Telecommunications, Inc. 297570 182.04 J649 Bayan Telecommunications, Inc. 279260 182.04 J650 Bayan Telecommunications, Inc. 297663 182.04 J651 Bayan Telecommunications, Inc. 305610 182.04 J654 Bayan Telecommunications, Inc. 279268 182.04 J655 Bayan Telecommunications, Inc. 297674 182.04 J656 Bayan Telecommunications, Inc. 305601 182.04 J657 Bayan Telecommunications, Inc. 297572 182.04 J658 Bayan Telecommunications, Inc. 305623 182.04 J781 Career Management Consulting & Business Solution, 91 16,650.00 Inc. J782 Career Management Consulting & Business Solution, 92 21,750.00 Inc. J783 Career Management Consulting & Business Solution, 93 21,600.00 Inc. J784 Career Management Consulting & Business Solution, 94 21,600.00 Inc. J792 CIBI Information, Inc. 19309 600.00 J793 Colliers International Philippines, Inc. 11032 754.82 J794 Colliers International Philippines, Inc. 10834 151,431.82 J795 Colliers International Philippines, Inc. 10979 151,431.82 J796 Concept One Management Services 219 10,178.57 J797 Cravings Food Services, Inc. 7017 5,785.71 J800 CWC International Corp. 27091 5,657,784.63 J801 CWC International Corp. 27078 249,375.00 J802 CWC International Corp. 27311 4,526,227.70 J806 DB Wizards, Inc. 8989 19,800.00 J807 DB Wizards, Inc. 9112 41,417.83 J809 Design & Creative Logic, Inc. 3480 4,276.85 J810 Design & Creative Logic, Inc. 3490 2,251.82 J812 Design & Creative Logic, Inc. 3479 2,673.43 J814 Design & Creative Logic, Inc. 3482 2,673.43 J816 DHL Express Phils. Corp. 1250931 1,166.35 J818 DHL Express Phils. Corp. 1250014 1,344.20 J820 DHL Express Phils. Corp. 1250489 4,503.39 J822 DHL Express Phils. Corp. 1250930 4,634.17 J824 DHL Express Phils. Corp. 1251050 12,163.75 J827 DHL Express Phils. Corp. 1251049 5,045.49 J834 DHL Express Phils. Corp. 1250453 2,044.60 J836 DHL Express Phils. Corp. 1251558 209.44 J837 E.E. Black, Ltd. 1351 1,299,882.09 J838 E.E. Black, Ltd. 1355 2,664,441.69 J840 Electronic Security Systems Corporation 7727 4,071.43 J841 Electronic Security Systems Corporation 7733 3,642.86 J849 Exclusive Cars, Inc. 2073 819.91 J850 Exclusive Cars, Inc. 2079 1,776.66 J851 Exclusive Cars, Inc. 2080 3,260.07 J852 Exclusive Cars, Inc. 2081 3,662.02 J853 Exclusive Cars, Inc. 2082 3,162.19 J854 Exclusive Cars, Inc. 2084 2,762.31 J855 Exclusive Cars, Inc. 2085 505.72 J856 Exclusive Cars, Inc. 2089 1,324.84 J861 Exclusive Cars, Inc. 2100 2,946.09 J864 Exclusive Cars, Inc. 2113 2,442.06 J865 Exclusive Cars, Inc. 2114 2,715.57 J866 Exclusive Cars, Inc. 2136 367.23 J868 Exclusive Cars, Inc. 2140 2,356.87 J899 Facilities Managers, Inc. 36677 25,253.81 J900 Facilities Managers, Inc. 36780 27,872.23 J901 Facilities Managers, Inc. 36923 47.32 J902 Facilities Managers, Inc. 36924 1,746.42 J903 Facilities Managers, Inc. 36925 2,283.53 J904 Facilities Managers, Inc. 36926 320.88 J1212 Goudie Associates Manila, Ltd. 1401 21,497.14 J1213 Goudie Associates Manila, Ltd. 1426 42,994.28 J1215 Headstrong Philippines, Inc. 1043 43,680.00 J1216 Headstrong Philippines, Inc. 1045 11,520.00 J1217 Headstrong Philippines, Inc. 1047 23,250.00 J1218 I.Systems Integrators, Inc. 717 399,167.14 J1254 International Elevator & Equipment, Inc. 17623 533,571.43 J1256 Jones Lang LaSalle (Philippines), Inc. 3405 50,895.00 J1257 Jones Lang LaSalle (Philippines), Inc. 3414 270,864.00 J1258 Jones Lang LaSalle (Philippines), Inc. 3406 48,214.65 J1259 Jones Lang LaSalle (Philippines), Inc. 3464 135,432.00 J1264 Kapient Philippines, Inc. 1088 49,896.00 J1265 Kapient Philippines, Inc. 1089 41,580.00 J1275 Lane Moving & Storage, Inc. 80478 360.00 J1276 Lane Moving & Storage, Inc. 80563 180.00 J1277 Lantro Phils., Inc. 1874 69,105.80 J1278 Lantro Phils., Inc. 1875 4,119,728.59 J1279 Lantro Phils., Inc. 1876 8,264.82 J1284 Mandarin Oriental Manila 21777 10,800.00 J1285 Mc Engineering, Inc. 5261 103,243.19 J1286 Mc Engineering, Inc. 5263 119,732.14 J1287 Mc Engineering, Inc. 5266 541,071.42 J1288 Mc Engineering, Inc. 5264 2,422,229.74 J1289 Mc Engineering, Inc. 5272 3,494,265.27 J1290 Micro-D International, Inc. 24647 5,827.63 J1291 Micro-D International, Inc. 24615 4,845.80 J1292 Micro-D International, Inc. 24562 124,039.93 J1293 Micro-D International, Inc. 24592 10,085.89 J1294 Micro-D International, Inc. 24614 151,640.91 J1295 Micro-D International, Inc. 24648 9,208.93 J1296 Monolith Construction and Development Corporation 2448 259,244.85 J1297 Monolith Construction and Development Corporation 2449 8,674.47 J1298 No Ka Oi (Philippines) International, Inc. 16946 4,933.67 J1299 No Ka Oi (Philippines) International, Inc. 17080 2,466.84 J1308 PLDT PWKOR000599041 151.09 J1309 PLDT PWKOR000596237 258.02 J1310 PLDT PWKOR000596236 486.67 J1317 PLDT PWKOR000599009 239.40 J1318 PLDT PWKOR000599004 160.71 J1320 PLDT PWKOR000596238 151.09 J1321 PLDT PWKOR000599039 160.71 J1324 PLDT PWKOR000599002 160.71 J1325 PLDT PWKOR000599037 160.71 J1326 PLDT PWKOR000599022 160.71 J1329 PLDT PWKOR000599010 239.40 J1340 PLDT PWKOR000599018 239.40 J1347 PLDT PWKOR000599036 239.40 J1349 PLDT PWKOR000599007 389.38 J1352 PLDT PWKOR000599032 239.40 J1354 PLDT PWKOR000599025 239.40 J1357 PLDT PWKOR000599024 239.40 J1359 PLDT PWKOR000599000 160.71 J1362 PLDT PWKOR000596241 31,482.18 J1363 PLDT PWKOR000599020 160.71 J1364 PLDT PWKOR000599023 160.71 J1368 PLDT PWKOR000599033 217.68 J1369 PLDT PWKOR000599021 239.40 J1371 PLDT PWKOR000599019 239.36 J1372 PLDT PWKOR000596239 8,507.70 J1373 PLDT PWKOR000599011 239.40 J1374 PLDT PWKOR000599016 217.68 J1376 PLDT PWKOR000599014 239.40 J1377 PLDT PWKOR000599006 239.40 J1378 PLDT PWKOR000599013 239.40 J1381 PLDT PWKOR000599904 239.40 J1386 PLDT PWKOR000618366 160.71 J1391 PLDT PWKOR000618373 239.40 J1398 PLDT PWKOR000619572 217.68 J1416 PLDT PWKOR000619567 389.38 J1417 PLDT PWKOR000619571 389.38 J1418 PLDT PWKOR000619569 389.38 J1426 PLDT PWKOR000619568 160.71 J1427 PLDT PWKOR000624041 160.71 J1431 PLDT PWKOR000618367 217.68 J1438 PLDT PWKOR000618369 239.40 J1453 PLDT PWKOR000624045 16,200.00 J1454 PLDT PWKOR000624043 19,980.00 J1456 PLDT PWKOR000596240 25,804.97 J1459 Premium Security & Investigation Agency, Inc. 51515 2,890.14 J1461 Premium Security & Investigation Agency, Inc. 51166 2,704.11 J1463 Premium Security & Investigation Agency, Inc. 51474 3,191.70 J1465 Premium Security & Investigation Agency, Inc. 51477 5,756.52 J1467 Premium Security & Investigation Agency, Inc. 51774 5,756.52 J1468 Primover Consultancy Services, Inc. 2280 38,640.00 J1473 R.S. Ison & Associates 295 4,800.00 J1475 R.S. Bernaldo & Associates 2906 36,000.00 J1476 Real Form Furniture Shop 161 1,029.60 J1477 Real Form Furniture Shop 173 4,365.00 J1478 Regus Centres, Inc. 11424 12,213.00 J1483 RP Reytas Industries 166 8,357.14 J1492 Sinclair Knight Merz 1197 19,440.00 J1493 Sky Cable Corporation 480514 48,192.00 J1500 Solstice Ventures, Inc. 3 12,857.14 J1501 SOP Printing House 959 1,125.00 J1502 SOP Printing House 960 1,735.71 J1506 Stagetek, Co. 330 535.71 J1507 Sycip Salazar Hernandez & Gatmaitan 5037944 2,700.00 J1510 Tempo Services, Inc. 41641 2,680.39 J1511 Tempo Services, Inc. 41294 2,808.67 J1512 Tempo Services, Inc. 41642 2,847.95 J1513 Tempo Services, Inc. 41884 2,811.86 J1514 Tempo Services, Inc. 42016 2,808.20 J1515 Tempo Services, Inc. 42023 3,349.34 J1516 Tempo Services, Inc. 42124 2,625.62 J1517 Tempo Services, Inc. 36899 2,570.85 J1518 Tierra International Construction Corporation 14927 432,000.00 J1519 Trane Philippines 26388 188,244.00 J1520 Zero Eight DB Design Services 261 9,000.00 Sub-total 38,125,236.67 2. Input VAT supported by official receipts dated not within the first quarter of 2009 J514 ACCRALAW 35929 5,400.00 J521 Air2100, Inc. 47379 438.71 J522 Air2100, Inc. 47380 129.21 J523 Air2100, Inc. 47381 399.63 J524 Air2100, Inc. 47382 505.62 J525 Air2100, Inc. 47383 131.20 J526 Air2100, Inc. 47384 431.42 J527 Air2100, Inc. 47385 208.48 J528 Air2100, Inc. 47386 104.24 J529 Air2100, Inc. 47387 108.45 J530 Air2100, Inc. 47388 108.45 J551 Bayan Telecommunications, Inc. 331599 182.04 J554 Bayan Telecommunications, Inc. 331582 182.04 J558 Bayan Telecommunications, Inc. 331600 182.04 J562 Bayan Telecommunications, Inc. 331588 182.04 J567 Bayan Telecommunications, Inc. 331584 182.04 J569 Bayan Telecommunications, Inc. 331906 182.04 J572 Bayan Telecommunications, Inc. 331907 182.04 J579 Bayan Telecommunications, Inc. 331908 182.04 J582 Bayan Telecommunications, Inc. 331909 182.04 J585 Bayan Telecommunications, Inc. 331910 182.04 J588 Bayan Telecommunications, Inc. 331911 182.04 J592 Bayan Telecommunications, Inc. 331583 182.04 J595 Bayan Telecommunications, Inc. 331912 182.04 J599 Bayan Telecommunications, Inc. 350063 182.04 J603 Bayan Telecommunications, Inc. 350064 182.04 J606 Bayan Telecommunications, Inc. 331913 182.04 J610 Bayan Telecommunications, Inc. 350065 182.04 J613 Bayan Telecommunications, Inc. 331914 182.04 J616 Bayan Telecommunications, Inc. 331592 182.04 J621 Bayan Telecommunications, Inc. 331590 182.04 J625 Bayan Telecommunications, Inc. 331915 182.04 J628 Bayan Telecommunications, Inc. 331591 182.04 J633 Bayan Telecommunications, Inc. 331598 182.04 J637 Bayan Telecommunications, Inc. 331596 182.04 J640 Bayan Telecommunications, Inc. 331595 182.04 J644 Bayan Telecommunications, Inc. 331593 182.04 J647 Bayan Telecommunications, Inc. 331916 182.04 J648 Bayan Telecommunications, Inc. 331917 182.04 J652 Bayan Telecommunications, Inc. 331597 182.04 J653 Bayan Telecommunications, Inc. 331918 269.22 J659 Bayan Telecommunications, Inc. 331919 182.04 J790 Chef Concepts Incorporated 15057 5,400.00 J832 DHL Express Phils. Corp. 1308240 4,782.84 J839 Electronic Security Systems Corporation 7809 964.29 J909 FMR Corporation 5960 1,210.71 J915 Fuji Xerox Philippines, Inc. 89299 64,807.35 J977 Globe Telecom, Inc. GALXAF05083274 204.00 J984 Globe Telecom, Inc. GALXAF05083270 204.00 J1007 Globe Telecom, Inc. GALXAF05083265 204.00 J1012 Globe Telecom, Inc. GALXAF05083268 204.00 J1015 Globe Telecom, Inc. GALXAF05083273 128.75 J1092 Globe Telecom, Inc. GALXAF05083266 204.00 J1103 Globe Telecom, Inc. GALXAF05083275 204.00 J1106 Globe Telecom, Inc. GALXAF05083267 204.00 J1180 Globe Telecom, Inc. GTWRBD05083272 204.00 J1221 Innove Communications, Inc. 2168 138.75 J1227 Innove Communications, Inc. 2167 138.75 J1251 Innove Communications, Inc. 2166 138.75 J1252 Innove Communications, Inc. 2165 138.75 J1262 Jones Lang LaSalle (Philippines), Inc. 3550 135,432.00 J1263 Jones Lang LaSalle (Philippines), Inc. 3552 109,859.28 J1266 Kapient Philippines, Inc. 1091 20,700.00 J1274 Lane Moving & Storage, Inc. 80726 900.00 J1283 Loxon Philippines, Inc. 20408 787.50 J1486 Santa Fe Moving and Relocation Services, Phils., Inc. 407 613.07 J1487 SAS Institute (Philippines), Inc. 2109 11,400.00 J1503 SOP Printing House 981 2,110.70 J1504 SOP Printing House 983 321.43 Sub-total 375,300.75 3. Input VAT supported by documents other than invoices or official receipts J396/7 National Book Store SSRDATED1/28/09 5,343.00 J409 National Book Store SSRDATED1/14/09 5,345.43 J424 National Book Store SSRDATED1/27/09 5,356.88 J431 National Book Store SSRDATED2/1/09 5,340.45 J442 National Book Store SSRDATED2/3/09 5,302.02 J452/3 National Book Store SSRDATED2/19/09 5,351.57 J467 National Book Store SSRDATED1/2/09 5,320.15 J1305 PLDT 7160 803.66 J1306 PLDT 4255 239.40 J1307 PLDT 6500 239.40 J1311 PLDT 1923 217.68 J1312 PLDT 9544 239.40 J1313 PLDT 9539 239.40 J1314 PLDT 5900 581.12 J1315 PLDT 6784 16,200.00 J1316 PLDT 6782 19,980.00 J1319 PLDT 3947 160.71 J1322 PLDT 9537 239.40 J1323 PLDT 3945 239.40 J1327 PLDT 4941 239.40 J1328 PLDT 9507 239.40 J1330 PLDT 9538 239.40 J1331 PLDT 3946 217.68 J1332 PLDT 9036 239.40 J1333 PLDT 9510 239.40 J1334 PLDT 9033 160.71 J1335 PLDT 9032 160.71 J1336 PLDT 9034 239.40 J1337 PLDT 3951 526.02 J1338 PLDT 5902 510.28 J1339 PLDT 5899 573.25 J1341 PLDT 5901 510.28 J1342 PLDT 3948 518.16 J1343 PLDT 3949 518.15 J1344 PLDT 3952 518.16 J1345 PLDT 3950 541.77 J1346 PLDT 5903 444.04 J1348 PLDT 9545 212.59 J1350 PLDT 9541 389.38 J1351 PLDT 9542 389.38 J1353 PLDT 9527 239.40 J1355 PLDT 6400 217.68 J1356 PLDT 9511 239.40 J1358 PLDT 9509 160.71 J1360 PLDT 3848 160.71 J1361 PLDT 3944 160.71 J1365 PLDT 3846 217.68 J1366 PLDT 9543 239.40 J1367 PLDT 6059 239.40 J1370 PLDT 3845 239.40 J1375 PLDT 6470 217.68 J1379 PLDT 9535 239.40 J1380 PLDT 9536 239.40 J1382 PLDT 3844 16,200.00 J1383 PLDT 3847 19,980.00 J1384 PLDT 6476 239.40 J1385 PLDT 4942 160.71 J1387 PLDT 6477 151.09 J1388 PLDT 3838 160.71 J1389 PLDT 6493 239.40 J1390 PLDT 1264 964.29 J1392 PLDT 6399 160.71 J1393 PLDT 4482 160.71 J1394 PLDT 1442 239.40 J1395 PLDT 3833 239.40 J1396 PLDT 3832 239.40 J1397 PLDT 6495 239.40 J1399 PLDT 6478 239.40 J1400 PLDT 6471 239.40 J1401 PLDT 6475 160.71 J1402 PLDT 6497 160.71 J1403 PLDT 6469 239.40 J1404 PLDT 3840 239.40 J1405 PLDT 3836 239.40 J1406 PLDT 6403 239.40 J1407 PLDT 3843 239.40 J1408 PLDT 6487 239.40 J1409 PLDT 6483 239.40 J1410 PLDT 4943 239.40 J1411 PLDT 3839 239.40 J1412 PLDT 3841 239.40 J1413 PLDT 6694 239.40 J1414 PLDT 6485 239.40 J1415 PLDT 6467 151.09 J1419 PLDT 6473 239.40 J1420 PLDT 6468 239.40 J1421 PLDT 6481 239.40 J1422 PLDT 3842 239.40 J1423 PLDT 6472 239.40 J1424 PLDT 6480 160.71 J1425 PLDT 6488 160.71 J1428 PLDT 4944 33,815.43 J1429 PLDT 6489 160.71 J1430 PLDT 6486 160.71 J1432 PLDT 1297 239.40 J1433 PLDT 6401 239.40 J1434 PLDT 1441 239.40 J1435 PLDT 6492 217.68 J1436 PLDT 6474 239.40 J1437 PLDT 4744 239.40 J1439 PLDT 6490 239.40 J1440 PLDT 6498 8,303.31 J1441 PLDT 4510 160.71 J1442 PLDT 6695 239.40 J1443 PLDT 6402 239.40 J1444 PLDT 6491 217.68 J1445 PLDT 3837 217.68 J1446 PLDT 6496 239.40 J1447 PLDT 6479 239.40 J1448 PLDT 6693 239.40 J1449 PLDT 3835 239.40 J1450 PLDT 6484 239.40 J1451 PLDT 6483 239.40 J1452 PLDT 6494 239.40 J1455 PLDT 7135 19,980.00 J1457 PLDT 6783 308.18 J1458 PLDT 3834 217.64 J1494 Smart Communications, Inc. 17 192.86 J1497 Smart Communications, Inc. 16 308.57 J1498 Smart Communications, Inc. 20 494.74 Sub-total 200,241.05 4. Input VAT supported by ZERO RATED official receipt J1214 Great Year Industries Corporation Manila 530 102,464.20 Sub-total 102,464.20 5. Input VAT supported by TIN official receipts J1280 Leaves & Branches Enterprises 3714 7,108.93 J1281 Leaves & Branches Enterprises 3747 7,108.93 J1282 Leaves & Branches Enterprises 3895 4,714.29 Sub-total 18,932.15 6. Input VAT supported by official receipts not in the name of petitioner J1301 P&L Resources, Inc. 3752 2,734.29 J1302 P&L Resources, Inc. 3753 4,191.43 J1303 P&L Resources, Inc. 3754 5,776.07 J1304 P&L Resources, Inc. 3755 4,932.86 Sub-total 17,634.65 7. Input VAT supported by official receipts imprinted with the phrase "not valid source of input tax" J1471 Product Providers, Inc. 24993 1,128.00 J1472 Product Providers, Inc. 25163 1,128.00 J1495 Smart Communications, Inc. 6776 375.00 J1496 Smart Communications, Inc. 4589 375.00 J1499 Smart Communications, Inc. 6777 192.86 Sub-total 3,198.86 8. Input VAT on purchases of services without supporting official receipts 6-3 Property Holdings, Inc. 0647 140,066.10 6-3 Property Holdings, Inc. 818,592.35 6-3 Property Holdings, Inc. 8,533.24 6-3 Property Holdings, Inc. 2,926.35 6-3 Property Holdings, Inc. 7,776.00 Cravings Food Services, Inc. 7098 8,678.57 CRV Aircon & Plumbing Services 1027 13,676.79 DHL Express Phils. Corp. 1250453 100.80 DHL Express Phils. Corp. 1250931 6,251.80 DHL Express Phils. Corp. 1251021 3.60 DHL Express Phils. Corp. 1308241 967.60 Digital Telecommunications - 189,017.28 Digital Telecommunications - 189,017.28 Digital Telecommunications - 189,979.20 Digital Telecommunications - 193,586.40 Digital Telecommunications - 193,626.48 Fuji Xerox Philippines, Inc. 86608 40,529.45 Globe Telecom, Inc. GTWRBD08027907 204.00 Globe Telecom, Inc. 8022718 204.00 Globe Telecom, Inc. 8027798 204.00 Globe Telecom, Inc. 6036089 204.00 Innove Communications, Inc. 6355190 152.18 Innove Communications, Inc. 6355561 138.75 Innove Communications, Inc. 6187557 138.75 Innove Communications, Inc. 6184053 138.75 Innove Communications, Inc. 6354280 152.18 Maxicare Healthcare Corp. 56804 191.60 Maxicare Healthcare Corp. 65148 24,948.40 Maxicare Healthcare Corp. 56018 731.17 MMLDC Foundation, Inc. 15729 17,098.20 Philippine Vending Corporation 5,335.47 PLDT 8,507.70 PLDT 31,482.18 Premium Security & Investigation Agency, Inc. 50917 2,854.21 Premium Security & Investigation Agency, Inc. 51153 3,709.46 R.S. Bernaldo & Associates 2970 36,000.00 SGV & Co. 53471 289.29 Sinclair Knight Merz 1196 19,440.00 Smart Communications, Inc. 8 558.71 Smart Communications, Inc. 26 375.00 Smart Communications, Inc. 28 192.86 Smart Communications, Inc. 27 535.71 Sub-total 2,157,115.86 Grand Total P41,000,124.19 ============ Moreover, part of the total input VAT claim of P58,385,248.41 is the amount of P1,500,608.79, representing petitioner's input VAT on purchases of capital goods exceeding P1,000,000.00. Pursuant to Section 110 (A) of the NIRC of 1997, as amended, as implemented by Section 4.110-3 of RR No. 16-2005, input VAT claim on capital goods purchases attributable to zero-rated sales may be claimed either in full during the month of acquisition, or spread over a period of time, depending on the aggregate acquisition cost of the capital goods in the calendar month. If the aggregate acquisition cost exceeds P1,000,000.00, the claim for input tax should be spread over 60 months or the estimated useful life of the capital goods, whichever is shorter. On the other hand, if aggregate acquisition cost does not exceed P1,000,000.00, the total input taxes shall be allowed as credit/refund in the month of acquisition. acEHCD Thus, while petitioner was able to substantiate the amount of P1,472,164.08 out of the total claimed input VAT of P1,500,608.79 on capital goods purchases exceeding P1,000,000.00, only the amortization for the first quarter of calendar year 2009 in the amount of P48,902.99 may be claimed by petitioner as valid input tax credits for the same taxable quarter, as determined below: Exhibit Supplier Date of Amount of Input VAT Monthly Amortization Invoice Purchase Input Tax Credit 59 J343 Accent Micro Technologies, Inc. 19-Jan-09 P17,321.42 P2,078.57 P34.64 P103.93 J344 Accent Micro Technologies, Inc. 19-Jan-09 17,321.42 2,078.57 34.64 103.93 J345 Accent Micro Technologies, Inc. 19-Jan-09 765,882.17 91,905.86 1,531.76 4,595.29 J346 Accent Micro Technologies, Inc. 20-Jan-09 4,025.00 483.00 8.05 24.15 J347 Accent Micro Technologies, Inc. 20-Jan-09 4,025.00 483.00 8.05 24.15 J348 Accent Micro Technologies, Inc. 20-Jan-09 27,303.58 3,276.43 54.61 163.82 J349 Accent Micro Technologies, Inc. 26-Jan-09 1,631,250.00 195,750.00 3,262.50 9,787.50 J350 Accent Micro Technologies, Inc. 29-Jan-09 42,857.17 5,142.86 85.71 257.14 J351 Accent Micro Technologies, Inc. 29-Jan-09 40,178.58 4,821.43 80.36 241.07 J352 Accent Micro Technologies, Inc. 29-Jan-09 32,142.83 3,857.14 64.29 192.86 Subtotal 2,582,307.17 309,876.86 15,493.84 J353 Accent Micro Technologies, Inc. 3-Feb-09 31,250.00 3,750.00 62.50 125.00 J354 Accent Micro Technologies, Inc. 3-Feb-09 1,362,642.83 163,517.14 2,725.29 5,450.57 J355 Accent Micro Technologies, Inc. 5-Feb-09 28,571.42 3,428.57 57.14 114.29 J356 Accent Micro Technologies, Inc. 10-Feb-09 6,250.00 750.00 12.50 25.00 J357 Accent Micro Technologies, Inc. 10-Feb-09 6,250.00 750.00 12.50 25.00 J358 Accent Micro Technologies, Inc. 11-Feb-09 1,359,375.00 163,125.00 2,718.75 5,437.50 J359 Accent Micro Technologies, Inc. 19-Feb-09 6,266.08 751.93 12.53 25.06 J360 Accent Micro Technologies, Inc. 19-Feb-09 5,819.67 698.36 11.64 23.28 J361 Accent Micro Technologies, Inc. 19-Feb-09 5,819.67 698.36 11.64 23.28 J362 Accent Micro Technologies, Inc. 25-Feb-09 2,501,250.00 300,150.00 5,002.50 10,005.00 J363 Accent Micro Technologies, Inc. 25-Feb-09 35,714.25 4,285.71 71.43 142.86 J364 Accent Micro Technologies, Inc. 27-Feb-09 17,857.17 2,142.86 35.71 71.43 J365 Accent Micro Technologies, Inc. 27-Feb-09 1,651,785.75 198,214.29 3,303.57 6,607.14 Subtotal 7,018,851.84 842,262.22 28,075.41 J366 Accent Micro Technologies, Inc. 3-Mar-09 32,946.42 3,953.57 65.89 65.89 J367 Accent Micro Technologies, Inc. 13-Mar-09 455,357.17 54,642.86 910.71 910.71 J368 Accent Micro Technologies, Inc. 13-Mar-09 2,125,000.00 255,000.00 4,250.00 4,250.00 J369 Accent Micro Technologies, Inc. 17-Mar-09 53,571.42 6,428.57 107.14 107.14 Subtotal 2,666,875.01 320,025.00 5,333.74 Grand Total P12,268,034.02 P1,472,164.08 P48,902.99 ============ =========== ============ Accordingly, the unamortized portion of the input VAT in the amount of P1,423,261.09 (P1,472,164.08 less P48,902.99) shall be deducted from petitioner's input VAT claim. In sum, petitioner's substantiated input VAT amounts to P10,795,843.81, and only the input VAT amount of P2,701,413.70 is attributable to petitioner's valid zero-rated receipts of P289,872,951.07, as computed below: Input VAT claimed for Refund P58,385,248.41 Less: Disallowances Per ICPA Findings (Annex A.1 to A.4) P5,166,019.32 Per this Court's Findings Input VAT on Purchases of Goods and Services P41,000,124.19 Unamortized Input VAT on Capital Goods exceeding P1M 1,423,261.09 42,423,385.28 47,589,404.60 Valid Input VAT P10,795,843.81 Multiply by Valid Zero Rated Receipts 289,872,951.07 Divided by Total Declared Receipts 1,158,439,045.31 Valid Input VAT attributable to valid zero-rated receipts P2,701,413.70 =============== However, since petitioner did not submit the invoices/official receipts proving the existence of its reported input VAT from previous quarter, its output VAT liability for the first quarter in the amount of P567,254.03 shall be offset against the substantiated input VAT attributable to VATable receipts in the amount of P44,053.43, and to zero-rated receipts in the amount of P523,200.60, as herein determined: VAT Allocation: VATable Sales Zero-Rated Sales Total Per VAT Returns P4,727,116.92 P1,153,711,928.39 P1,158,439,045.31 Valid Input VAT Allocation 44,053.43 60 10,751,790.38 61 10,795,843.81 Output VAT Allocation 44,053.43 523,200.60 62 567,254.03 Hence, only the input VAT of P2,178,213.10, as computed below, may be refunded to petitioner: Valid Input VAT attributable to valid zero-rated receipts P2,701,413.70 Less: Output VAT allocated to zero-rated receipts 523,200.60 Refundable Input VAT P2,178,213.10 =========== Even though the claimed input VAT was carried over by petitioner in the succeeding Quarterly VAT Returns in 2009 63 and 2010, 64 the same remained unutilized until it was deducted 65 from petitioner's total available input tax in the fourth quarter of 2010. Consequently, the subject claim no longer formed part of the excess input VAT of P264,856,936.52 66 as of the fourth quarter of 2010 which was carried over/applied to the succeeding first quarter of 2011. 67 WHEREFORE , premises considered, the present Petition for Review is hereby PARTIALLY GRANTED . Accordingly, respondent is hereby ORDERED TO REFUND OR TO ISSUE A TAX CREDIT CERTIFICATE in favor of petitioner in the amount of P2,178,213.10 representing the latter's unutilized input VAT attributable to its zero-rated sales for the first quarter of 2009. SO ORDERED . SDHTEC (SGD.) CIELITO N. MINDARO-GRULLA Associate Justice Roman G. del Rosario, P.J. and Erlinda P. Uy, J., concur. Footnotes 1. Sec. 7. Jurisdiction. The CTA shall exercise: (a) Exclusive appellate jurisdiction to review by appeal, as herein provided: xxx xxx xxx (2) Inaction by the Commissioner of Internal Revenue in cases involving disputed assessments, refunds or internal revenue taxes, fees of 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, where the National Internal Revenue Code provides a specific period for action, in which case the inaction shall be deemed a denial; xxx xxx xxx 2. Rule 4, Sec. 3. Cases within the jurisdiction of the Court in Division . The Court in Division shall exercise: (a) Exclusive original over or appellate jurisdiction to review by appeal the following: xxx xxx xxx (2) Inaction by 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, where the National Internal Revenue Code or other applicable law provides a specific period for action: Provided , that in case of disputed assessments, the inaction of the Commissioner of Internal Revenue within the one hundred eighty day-period under Section 228 of the National Internal Revenue Code shall be deemed a denial for purposes of allowing the taxpayer to appeal his case to the Court and does not necessarily constitute a formal decision of the Commissioner of Internal Revenue on the tax case; Provided, further , that should the taxpayer opt to await the final decision of the Commissioner of Internal Revenue on the disputed assessments beyond the one hundred eighty day-period abovementioned, the taxpayer may appeal such final decision to the Court under Section 3 (a), Rule 8 of these Rules; xxx xxx xxx Rule 8, Sec. 4. Where to appeal; mode of appeal. (a) An appeal from a decision or ruling or the inaction of the Commissioner of Internal Revenue on disputed assessments or claim for refund of internal revenue taxes erroneously or illegally collected, the decision or ruling of the Commissioner of Customs, the Secretary of Finance, the Secretary of Trade & Industry, the Secretary of Agriculture, and the Regional Trial Court in the exercise of their original jurisdiction, shall be taken to the Court by filing before it a petition for review as provided in Rule 42 of the Rules of Court. The Court in Division shall act on the appeal. xxx xxx xxx 3. Par. 1, Admitted Facts, Joint Stipulation of Facts and Issues (JSFI), Docket, p. 79. 4. Exhibit "B"; Par. 2, Admitted Facts, JSFI, Docket, p. 80. 5. Exhibit "A"; Par. 3, Admitted Facts, JSFI, Docket, p. 80. 6. Par. 4, Admitted Facts, JSFI, Docket, p. 80. 7. Exhibit "P" to "P-35". 8. Exhibit "C"; Par. 6, Admitted Facts, JSFI, Docket, p. 81. 9. The application for tax credits/refunds was filed with BIR-RDO No. 44, Exhibit "L-1". 10. The letter claim for refund/issuance of TCC was filed with the BIR RDO No. 44, Exhibit "L". 11. Docket, pp. 48-49. 12. Docket, pp. 51-53. 13. Docket, pp. 57-65. 14. Minutes of the Pre-Trial; Docket, pp. 66-67. 15. Docket, pp. 79-84. 16. Docket, pp. 88-93. 17. Docket, p. 102. 18. Formal Offer of Evidence filed on May 7, 2012, Docket, pp. 247-709. 19. Records Verification dated September 27, 2012, Docket, p. 715. 20. Docket, pp. 717-718. 21. Docket, pp. 723-729. 22. Docket, pp. 760-764. 23. Docket, pp. 769-771. 24. Docket, pp. 1170-1561. 25. Records Verification dated September 18, 2013, Docket, p. 1569. 26. Docket, pp. 1573-1574. 27. Manifestation dated December 11, 2013, Docket, pp. 1575-1577. 28. Docket, pp. 1578-1587. 29. Records Verification dated February 13, 2014, Docket, p. 1598. 30. Docket, pp. 1602-1603. 31. Docket, pp. 1604-1612. 32. Docket, pp. 1618-1646. 33. Records Verification dated June 5, 2014, Docket, p. 1654. 34. Docket, pp. 1656-1658. 35. Docket, pp. 1678-1688. 36. Records Verification dated October 13, 2014, Docket, p. 1692. 37. Docket, pp. 1696-1697. 38. Records Verification dated January 9, 2015, Docket, p. 1698. 39. Docket, p. 1702. 40. Stipulated Issues for Resolution, JSFI, Docket, pp. 81-82. 41. Par. 3, Petition for Review, Docket, p. 3. 42. Par. 5, Petition for Review, Docket, p. 3. 43. Par. 8.1, Petition for Review, Docket, p. 4. 44. Par. 11, Answer, Docket, p. 49. 45. G.R. No. 184823, October 6, 2010. 46. Exhibits "L" and "L-1". 47. G.R. No. 153205, January 22, 2007. 48. Exhibit "A"; Par. 3, Admitted Facts, JSFI, Docket, p. 80. 49. Par. 4, Admitted Facts, JSFI, Docket, p. 80. 50. Exhibits "J92" to "J286". 51. Exhibits "J287" to "J342". 52. Exhibits "J1" to "J91". 53. Exhibits "O-12", "O-14" to "O-20", "O-22", "O-24", "O-25", "O-30" to "O-40", "O-44", "O-47", and "O-48". 54. Exhibits "O" to "O-10" and "O-49" to "O-73". 55. Exhibits "P", "P-2" to "P-11", "P-13", "P-14", "P-16", "P-18", "P-20" to "P-27", "P-32", and "P-35". 56. Annex E, Exhibit "R". 57. Exhibits "J-343" to "J-1555". 58. Exhibit "R". 59. This is based on the estimated useful life of 60 months since the Court cannot determine the actual life of the capital goods. 60. P4,727,116.92/P1,158,439,045.31 x P10,795,843.81. 61. P1,153,711,928.39/P1,158,439,045.31 x P10,795,843.81. 62. P567,254.03 - P44,053.43. 63. Exhibits "D", "E", and "F". 64. Exhibits "G-1", "H", and "I". 65. Line 23D, Exhibit "J-1-a". 66. Line 27, Exhibit "J-1-a". 67. Line 20E, Exhibit "K".