Univation Motor Philippines, Inc. v. Commissioner of Internal Revenue

THIRD DIVISION [C.T.A. CASE NO. 8797. July 21, 2016.] UNIVATION MOTOR PHILIPPINES, INC. , 1 petitioner , vs. COMMISSIONER OF INTERNAL REVENUE , respondent . DECISION BAUTISTA , J p : The Case The Petition for Review, 2 filed pursuant to Section 3 (a) (1), Rule 4 of the Revised Rules of the Court of Tax Appeals , 3 prays for the refund or issuance of a tax credit certificate ("TCC") in the amount of Php13,165,171.67 representing petitioner's excess and unutilized creditable withholding tax ("CWT") for calendar year ("CY") 2011. The Parties Petitioner is a corporation duly organized and existing under the laws of the Republic of the Philippines, with principal place of business at the Nissan Technopark, Barangay Pulong Sta. Cruz, Sta. Rosa, Laguna. 4 Respondent is the duly appointed Commissioner of Internal Revenue ("CIR") vested with authority to carry out all the functions, duties, and responsibilities of said office, including, inter alia ,the power to act upon, decide, and approve claims for refund and/or tax credits of overpaid or erroneously paid or collected internal revenue taxes. She holds office at the 5th Floor, Bureau of Internal Revenue ("BIR") National Office Building, Agham Road, Diliman, Quezon City. 5 The Facts Petitioner was incorporated for the primary purpose of carrying out the business of "buying, acquiring, manufacturing, assembling, producing, importing, holding, selling, disposing, distributing, dealing in motor trucks, cars, engines and other kinds of automobiles and mechanically propelled vehicles, means of transportation and industrial machinery, their bodies, spare parts, accessories; and to repair, maintain, service, condition and/or recondition said products." 6 Petitioner is a registered taxpayer of the BIR, Large Taxpayers Service, with Taxpayer Identification No. 000-389-353-000. 7 IDSEAH For CY 2011, petitioner manually filed with the BIR its Annual Income Tax Return ("ITR") on April 26, 2012, 8 and electronically filed the same with the BIR through the electronic Filing and Payment System ("eFPS") on July 25, 2012, 9 marked as belatedly filed. 10 Under its 2011 Annual ITR, petitioner was liable for Minimum Corporate Income Tax ("MCIT") in the amount of Php1,344,538.02 considering that the MCIT was higher than the Normal Income Tax Due of Php0.00. Nevertheless, petitioner had an overpayment of Php25,055,787.65, computed as follows: Income Tax Due (MCIT) Php1,344,538.02 Less: Tax Credits/Payments Prior Year's Excess Credits Other Than MCIT Php13,235,154.00 Creditable Tax Withheld from Previous Quarter/s 10,132,336.00 Creditable Tax Withheld per BIR Form No. 2307 for the Fourth Quarter 3,032,835.67 Total Tax Credits/Payments 26,400,325.67 Net Tax Payable/(Overpayment) Php(25,055,787.65) Aggregate Tax Payable/(Overpayment) (25,055,787.65) Total Penalties 0.01 Total Amount Payable/(Overpayment) Php(25,055,787.64) =============== Accordingly, petitioner indicated on the face of its 2011 Annual ITR its option to be issued a TCC for its excess and unutilized CWT for CY 2011. 11 Thereafter, on December 21, 2012, petitioner filed with the BIR, Large Taxpayers Excise Audit Division II an administrative claim for refund or issuance of TCC for its excess and unutilized CWT for CY 2011 in the amount of Php13,165,171.00. 12 On April 10, 2014, petitioner filed the present Petition for Review 13 following Sections 58 (D), 76, 204 (C), and 229 of the National Internal Revenue Code of 1997 (the "1997 NIRC"). On June 24, 2014, respondent filed her Answer 14 interposing the following Special and Affirmative Defenses: 15 4. She reiterates and re-pleads the preceding paragraphs of this Answer as part of her Special and Affirmative Defenses. 5. Taxes collected are presumed to be in accordance with laws and regulations. 6. The amount of Php13,165,171.00 allegedly representing excess and unutilized creditable withholding tax for calendar year 2011 was not properly documented. 7. In an action for refund, the burden of proof is on the taxpayer to establish its right to refund, and failure to sustain the burden is fatal to the claim for refund/credit. 8. All claims for refund are governed by one same rule: that respondent still has to investigate and ascertain the veracity of the claim. As the Supreme Court stated in one case, "[a] corporate taxpayer's option to avail of tax credit does not, however, mean that it is ipso facto granted." Hence, petitioner's alleged claim for refund is subject to administrative routinary investigation/examination by the Bureau of Internal Revenue. The instant claim for tax refund is tainted with procedural infirmity due to petitioner's failure to submit complete documents in support of its administrative claim for refund. 9. Basic as hornbook principle is that, taxes are the lifeblood of the nation through which the government agencies continue to operate and with which the State effects its functions for the welfare of its constituents. Hence, tax refunds are in the nature of tax exemptions and are to be interpreted in the strictest manner. Considering that tax refunds consist of monetary amounts which are currently in the hands of the government, the validity of petitioner's claim should be meticulously verified. With these, to claim for refund, petitioner should adduce every single document that will prove its entitlement to its claim. It is imperative to prove therefore every minute aspect of its case. 10. Hence, in order to be entitled to the refund being sought, petitioner must satisfactorily comply with the following requisites: 1. The claim must be filed with the CIR within the two-year period from the date of payment of the tax; 2. It must be shown on the return that the income received was declared as part of the gross income; and 3. The fact of withholding must be established by a copy of a statement duly issued by the payor to the payee showing the amount paid and the amount of the tax withheld. 11. However, compliance with the afore-quoted requirements will not suffice if petitioner failed to comply with the prescribed checklist of requirements to be submitted involving claims for unutilized creditable withholding tax pursuant to Revenue Memorandum Order (RMO) No. 53-98 (Checklist of Documents to be Submitted by a Taxpayer upon Audit of his Tax Liabilities as well as of the Mandatory Reporting Requirements to be Prepared by a Revenue Officer, all of which comprise a Complete Tax Docket).To be sure, RMO No. 53-98 was issued to identify the documents required from a taxpayer during audit of the application for refund. In obedience to the provisions of RMO No. 53-98, the following documents must be submitted by the taxpayer: aCIHcD INCOME TAX/WITHHOLDING TAX A) Requirements from Taxpayer 1) Certified Financial Statements, including comparative Profit and Loss Statement with Statement of Cost of Goods Manufactured and Sold, if applicable. 2) Proof of claimed tax credit if applicable. 3) Proof of the claimed "Interest Expense," if applicable. 4) Proof of claimed Bad Debts/worthlessness of credits, if applicable. 5) Reconciliation of "Book Income" and "Taxable Income." 6) Certificate of Registration issued by the appropriate regulatory agency, together with the conditions attached to such registration, if applicable. 7) Proof of Exemption under special laws, if applicable. 8) Certification of the appropriate regulatory agency as to taxpayer's entitlement to tax incentives, if applicable. 9) Xerox copy of used Tax Credit Certificate with annotation of issued TDM at the back, if applicable. 10) Proof of payment of deficiency tax, if any/applicable. a) [C]urrent year/period b) [P]revious year/period 11) Reports submitted to applicable regulatory agency that reflects the financial condition and result of operation of the taxpayer e.g. ,Annual Statement prepared by insurance companies submitted to the Insurance Commissioner etc.,if applicable. 12. Further, Revenue Regulations 2-2006 (Mandatory Attachments of the Summary Alpha list of Withholding Agents of Income Payments Subjected to Tax Withheld at Source (SAWT) to Tax Returns with Claimed Tax Credits due to Creditable Tax Withheld at Source and of the Monthly Alphalist of Payees (MAP) whose income received have been subjected to Withholding Tax to the Withholding Tax Remittance Return Filed by the Withholding Agent/Payor of Income Payments) provides: Section 2. MANDATORY SUBMISSION OF SUMMARY ALPHALIST WITHHOLDING AGENTS OF INCOME PAYMENTS SUBJECTED TO CREDITABLE WITHHOLDING TAXES (SAWT) BY THE PAYEE/INCOME RECIPIENT AND OF MONTHLY ALPHALIST OF PAYEES (MAP) SUBJECTED TO WITHHOLDING TAX BY THE WITHHOLDING AGENT INCOME PAYOR AS ATTACHMENT TO THEIR FILED RETURNS. A. ... B. Persons required to submit Summary Alpha list of Withholding Agents of Income Payment subjected to Withholding-Taxes (SAWT) 1. All persons claiming refund or applying their creditable tax withheld at source against the tax due with not more than ten (10) withholding agents-payor of income payment per return period are strictly required to submit SAWT in hard copy as attachment to the required tax return; 2. All persons claiming for refund or applying their creditable tax withheld at source against the tax due with more than ten (10) withholding agents-payor of income payment per return period are strictly required to submit SAWT electronically in 3.5 inch floppy diskette following the format to be prescribed by the BIR; 13. Simply put, petitioner must prove compliance with RR 53-98 and 2-2006 ,to give support to the validity of its claim for excess and unutilized creditable withholding tax for calendar year 2011. Verily, administrative issuances have the force and effect of law. They benefit from the same presumption of validity and constitutionality enjoyed by statutes. Failure of the petitioner to prove compliance with the above-mentioned requirements in the administrative level will likely render its Petition for Review vulnerable and shows the weakness of its claim. 14. Likewise, failure on the part of the taxpayer to submit relevant documents in the administrative level, such as in the instant case, makes the administrative claim for tax refund or credit pro-forma and shall be construed as if no administrative claim was filed at all. 15. In the case at bar, petitioner miserably failed to substantiate its administrative claim for refund filed with respondent and failed to submit the complete list of requirements mandated under RMO No. 53-98. There is no record of petitioner ever submitting all the required documents to substantiate its administrative claim for refund. This is a requirement established by law and jurisprudence. cHaCAS 16. In cases such as this, before judicial inquiry into the issue of whether taxpayers, in general, are entitled to a refund/tax credit under substantive law may be considered, they have an initial burden to discharge. They must prove that they complied with all the administrative requirements continuing up to judicial review. In other words, before trial de novo proceeds and disposes of the issue of refund entitlement under substantive law, it must first be proved that there was procedural compliance in pursuing the administrative claim leading to the appellate proceedings. 17. The Supreme Court in Atlas Consolidated Mining and Development Corporation vs. Commissioner of Internal Revenue, (G.R. No. 145526, March 16, 2007) held that: "..a judicial claim for refund or tax credit in the CTA is by no means an original action but rather an appeal by way of petition for review of a previous, unsuccessful administrative claim. Therefore, as in every appeal or petition for review, a petitioner has to convince the appellate court that the quasi-judicial agency a quo did not have any reason to deny its claims. In this case, it was necessary for petitioner to show the CTA not only that it was entitled under substantive law to the grant of its claims but also that it satisfied all the documentary and evidentiary requirements for an administrative claim for refund or tax credit. Second, cases filed in the CTA are litigated de novo .Thus, a respondent should prove every minute aspect of its case by presenting, formally offering and submitting its evidence to the CTA. Since it is crucial for a petitioner in a judicial claim for refund or tax credit to show that its administrative claim should have been granted in the first place, part of the evidence to be submitted to the CTA must necessarily include whatever is required for the successful prosecution of an administrative claim. [] xxx xxx xxx" 18. Clearly, the necessity for petitioner to submit all relevant documents to substantiate its administrative claim for refund is imperative. Absent these circumstances, the judicial claim merely becomes an attempt by the taxpayer to circumvent the role and duties of the Commissioner in evaluating taxpayer's claim for refund. Had petitioner submitted all relevant documents to substantiate its claim for tax credit, respondent would have the opportunity to determine the veracity of its claim and might refund or issue a tax credit certificate for the claimed amount. Again, petitioner undermines the respondent's administrative duty under the tax code by its failure to submit relevant documents, therefore depriving the respondent of the opportunity and time to study petitioner's claim for refund and to fully exercise its function. Petitioner miserably failed to exhaust administrative remedies before elevating the case to the Honorable Court 19. Well-settled is the rule that, the party aggrieved by a decision of an administrative official should first apply for review of such decision by higher administrative authority before seeking judicial relief, otherwise his court suit may be dismissed for prematurity or lack of cause of action. 20. In Jariol v. COMELEC, 80 SCAD 910, 270 SCRA (1997) ,the Highest Tribunal had occasion to rule the following: xxx xxx xxx "The aggrieved party must not merely initiate the prescribed administrative procedure to obtain relief, but must also pursue it to its appropriate conclusion before seeking judicial intervention in order to give that administrative agency an opportunity to decide the matter by itself correctly and prevent unnecessary and premature resort to the court. " [] xxx xxx xxx 21. In the instant case, respondent was not given sufficient facts to evaluate the administrative claim. In a Final Notice dated February 14, 2014, the OIC Chief of LT Excise Audit Division 2 stated: "The Revenue Officers who are assigned to conduct investigation of your tax liabilities have reported to me up that up [sic] to this writing, you have not presented the needed records to them for examination and approval of your claim for income tax refund despite their repeated requests therefore. Your failure to do so, being a violation of the above cited Bookkeeping Regulations, the investigating Revenue Officers have recommended that a Subpoena Duces Tecum be duly served on you as prescribed. ..." 22. Respondent humbly submits that failure on the part of petitioner to submit the required complete supporting documents would render the instant petition with this Honorable Court to have been prematurely filed. 23. In Ampil, Jr. vs. COMELEC, the Supreme Court had repeatedly pronounced the following: "...In a long line of cases, this Court has held consistently that before a party is allowed to seek the intervention of the Court, it is a pre-condition that he should have availed of all the means of administrative processes afforded him. Hence, if a remedy within the administrative machinery can still be resorted to by giving the administrative officer concerned every opportunity to decide on a matter that comes within his jurisdiction, then such remedy should be exhausted first before the court's judicial power can be sought. The premature invocation of court's intervention is fatal to one's cause of action[.]" DACcIH xxx xxx xxx 24. Petitioner's claim for refund is subject to administrative investigation/examination by respondent. Pending the closure of this investigation, no grant of refund may be given to petitioner based on the filed claim. It has been held by the Supreme Court that a claim for refund is not ipso facto granted because the Commissioner of Internal Revenue still has to investigate and ascertain the veracity of the claim. 25. The purpose of requiring submission of supporting documents relevant to a claim for tax credit is to give the administrative agency the opportunity to ascertain the veracity and validity of the claim. This is the very essence, the very substance of the doctrine of exhaustion of administrative remedies. The doctrine rests upon the presumption that the administrative body, board, or officer, if given the chance to correct its mistake or error, may amend its decision on a given matter and decide it properly. Thus, non-compliance with a condition precedent renders the petition for review filed by petitioner dismissible. 26. Additionally, the doctrine of exhaustion of administrative remedies ensures an orderly procedure which favors a preliminary sifting process, particularly with respect to matters peculiarly within the competence of the administrative agency. After this sifting process comes the availability of judicial review of administrative decisions. Judicial review of administrative decisions entails the Court to examine the method in which the decision was arrived at, and finding no error, lets the administrative decision stand. This is precisely because, as previously stated, these are matters peculiarly within the competence of the administrative agency. 27. It is a sound rule in tax laws, that the taxpayer who feels aggrieved by the actions taken by tax authorities may not seek redress in the courts of justice without first exhausting available administrative remedies ,except for certain well-recognized exceptions. It is the policy of the law and good practice to discourage court litigations and encourage resort to administrative action whenever the latter is feasible, adequate, and speedy. Another thing, the respect and consideration due to each branch of the government demand that the judicial department abstain, whenever possible from interfering in the acts of the other departments except when the latter transcend their respective shares of action and suitable remedies cannot be obtained by them. Of prime importance therefore is the requirement for petitioner to submit all relevant documents to substantiate its administrative claim for refund. The filing of the petition for review to this Honorable Court must be due to the denial by respondent of petitioner's claim or respondent's inaction which is tantamount to a denial of the said petitioner's claim. Absent these circumstances, the judicial claim merely becomes an attempt by the taxpayer to circumvent the role and duties of the Commissioner in evaluating taxpayer's claim for refund. Claims for refund are construed strictly against the taxpayer and in favor of the Government. 28. Time and again, it has been held that the right of taxation cannot easily be surrendered, statutes granting tax exemptions are considered as a derogation of the sovereign authority. Statutes that grant tax exemptions are construed strictissimi juris against the taxpayer and liberally in favor of the taxing authority. The general rule is that claimants of tax refunds bear the burden of proving the factual basis of their claims. Again, taxes are the lifeblood of the nation. Therefore, statutes that allow exemptions are construed strictly against the grantee and liberally in favor of the government. 29. In Asiatic Petroleum Co. v. Llanes ,the Honorable Supreme Court held that: "When exemption is claimed, it must be shown indubitably to exist. At the outset, every presumption is against it. A well-founded doubt is fatal to the claim. It is only when the terms of the concession are too explicit to admit fairly of any other construction that the proposition can be supported." 16 Respondent filed her Pre-Trial Brief on August 8, 2014, 17 while petitioner filed its Pre-Trial Brief on August 11, 2014. 18 On October 1, 2014, the parties filed their Joint Stipulation of Facts and Issues, 19 which was adopted by the Court in the Pre-Trial Order dated October 16, 2014. 20 On April 23, 2015, petitioner filed its Formal Offer of Evidence, 21 which was resolved by the Court in a Resolution dated May 25, 2015. 22 Subsequently, on July 20, 2015, petitioner filed its Supplemental Formal Offer of Evidence, 23 which was resolved by the Court in a Resolution dated September 8, 2015. 24 Meanwhile, during the hearing held on May 25, 2015, respondent manifested that she will not be presenting any witnesses. 25 In compliance with this Court's Resolution dated September 8, 2015, 26 which ordered the parties to file their respective memoranda within thirty (30) days from receipt thereof, respondent filed her Memorandum on October 15, 2015 27 while petitioner filed its Memorandum on October 29, 2015. 28 HSCATc On November 11, 2015, this Court promulgated a Resolution 29 submitting the case for decision; hence, this Decision. The Issue The sole issue for consideration of the Court is, as follows: WHETHER PETITIONER IS ENTITLED TO ITS CLAIM FOR REFUND OR ISSUANCE OF TCC FOR EXCESS AND UNUTILIZED CWT FOR CY 2011 IN THE AMOUNT OF PHP13,165,171.67. 30 The Ruling of the Court The Petition for Review is meritorious. The relevant provision, Section 76 of the 1997 NIRC ,reads as follows: SEC. 76. Final Adjustment Return. Every corporation liable to tax under Section 27 shall file a final adjustment return covering the total taxable income for the preceding calendar or fiscal year. If the sum of the quarterly tax payments made during the said taxable year is not equal to the total tax due on the entire taxable income of that year, the corporation shall either: (A) Pay the balance of tax still due; or (B) Carry-over the excess credit; or (C) Be credited or refunded with the excess amount paid, as the case may be. In case the corporation is entitled to a tax credit or refund of the excess estimated quarterly income taxes paid, the excess amount shown on its final adjustment return may be carried over and credited against the estimated quarterly income tax liabilities for the taxable quarters of the succeeding taxable years. Once the option to carry-over and apply the excess quarterly income tax against income tax due for the taxable quarters of the succeeding taxable years has been made, such option shall be considered irrevocable for that taxable period and no application for cash refund or issuance of a tax credit certificate shall be allowed therefor. 31 The above-cited provision states that corporations with excess income taxes may either carry over the excess credit to the succeeding taxable quarters, or claim a refund or the issuance of a TCC for the same; however, once the corporation opts to carry over its excess credit, such option shall be considered irrevocable for the taxable period and the corporation may no longer claim a refund or the issuance of a TCC. A review of petitioner's 2011 Annual ITR 32 shows that petitioner had income tax credits in the total amount of Php26,400,325.67 33 consisting of the prior year's excess credits other than the MCIT in the amount of Php13,235,154.00 34 and CWT accumulated during the four (4) quarters of CY 2011 in the aggregate amount of Php13,165,171.67, 35 as follows: 36 Sales/Revenues/Receipts/Fees Php1,510,345,251.00 Less: Cost of Sales/Services 1,452,761,712.00 Gross Income from Operation 57,583,539.00 Add: Other Taxable Income 9,643,362.00 Gross Income Php67,226,901.00 Total Itemized Deductions 445,295,663.00 Net Taxable Income Php(378,068,762.00) Applicable Income Tax Rate 30% Income Tax Due Other Than MCIT Php- MCIT Php1,344,538.02 Income Tax Due Php1,344,538.02 Less: Tax Credits/Payments Prior Year's Excess Credits Other than MCIT Php13,235,154.00 Creditable Tax Withheld 37 13,165,171.67 Tax Credits/Payments 26,400,325.67 Total Amount Payable/(Overpayment) Php(25,055,787.65) =============== As illustrated below, the prior year's excess credits of Php13,235,154.00 originated from the CWT for CY 2008 in the amount of Php16,024,714.00, which are duly supported by various Certificates of Creditable Tax Withheld at Source (BIR Forms No. 2307): 38 Exhibit Year Income Prior Year's (Income Tax Still CWT for Excess CWT Tax Due Excess Due)/Balance the Year at the end (a) Credits of Prior Year's of the Year (b) Excess Credits (c=b-a) "P-29-1" 2005 13,120,451.40 - (13,120,451.40) 32,752,987.00 19,632,535.60 "P-29-2" 2006 - 19,632,536.00 19,632,536.00 25,287,007.00 44,919,543.00 "P-29-3" 2007 56,165,995.35 44,919,543.00 (11,246,452.35) 19,514,513.00 8,268,060.65 "P-29-4" 2008 6,188,219.90 8,268,061.00 2,079,841.10 16,024,714.00 18,104,555.10 "P-29-5" 2009 2,527,717.78 18,104,555.00 15,576,837.22 - 39 15,576,837.22 "P-29-6" 2010 2,341,683.48 15,576,837.00 13,235,153.52 - 40 13,235,153.52 "P-3" 2011 1,344,538.02 13,235,154.00 11,890,615.98 - 41 11,890,615.98 42 Petitioner's MCIT due for CY 2011 in the amount of Php1,344,538.02 was offset against the prior year's excess credits of Php13,235,154.00; thus leaving the balance of the prior year's excess credits of Php11,890,615.98 and creditable taxes withheld during CY 2011 in the amount of Php13,165,171.67 (or a total amount of Php25,055,787.65) 43 unutilized as of December 31, 2011, as shown below: IDTSEH Prior Year's Excess Credits Php13,235,154.00 Less: Income Tax Due (MCIT for 2011) 1,344,538.02 Balance of Prior Year's Excess Credits Php11,890,615.98 Add: Creditable Taxes Withheld During the Year 13,165,171.67 Unutilized Excess Tax Credits as of December 31, Php25,055,787.65 2011 ============== Inasmuch as petitioner clearly indicated its intention to be issued a TCC by marking the box corresponding to the said choice in its 2011 Annual ITR, 44 and only the excess tax credits from CY 2008 in the amount of Php11,890,616.00 45 were carried over by petitioner in its Amended Annual ITR for the succeeding CY 2012, 46 the amount of Php13,165,171.67 may be the proper subject of a claim for refund under Section 76 of the 1997 NIRC. In Banco Filipino Savings and Mortgage Bank v. Court of Appeals , 47 the Supreme Court enumerated the requisites for granting a claim for refund of CWT, as follows: 1. The claim is filed with the CIR within the two (2)-year period from the date of payment of the tax; 2. It is shown on the return of the recipient that the income payment received was declared as part of the gross income; and 3. The fact of withholding is established by a copy of a statement duly issued by the payor to the payee showing the amount paid and the amount of the tax withheld therefrom. The Court shall now determine in seriatim whether petitioner was able to comply with the aforementioned requisites. The claim for refund was timely filed. Section 204 (C) in relation to Section 229 of the 1997 NIRC requires the filing of an administrative claim for refund before the filing of a judicial claim, both of which claims should be filed within two (2) years from payment of the tax. The relevant provisions read: Sec. 204. Authority of the Commissioner to Compromise, Abate and Refund or Credit Taxes. The Commissioner may xxx xxx xxx (C) Credit or refund taxes erroneously or illegally received or penalties imposed without authority, refund the value of internal revenue stamps when they are returned in good condition by the purchaser, and, in his discretion, redeem or change unused stamps that have been rendered unfit for use and refund their value upon proof of destruction. No credit or refund of taxes or penalties shall be allowed unless the taxpayer files in writing with the Commissioner a claim for credit or refund within two (2) years after the payment of the tax or penalty ; Provided, however ,That a return filed showing an overpayment shall be considered as a written claim for credit or refund. xxx xxx xxx Sec. 229. Recovery of Tax Erroneously or Illegally Collected. No suit or proceeding shall be maintained in any court for the recovery of any national internal revenue tax hereafter alleged to have been erroneously or illegally assessed or collected, or of any penalty claimed to have been collected without authority, or of any sum alleged to have been excessively or in any manner wrongfully collected, until a claim for refund or credit has been duly filed with the Commissioner ;but such suit or proceeding may be maintained, whether or not such tax, penalty, or sum has been paid under protest or duress. In any case, no such suit or proceeding shall be filed after the expiration of two (2) years from the date of payment of the tax or penalty regardless of any supervening cause that may arise after payment ; Provided, however ,That the Commissioner may, even without a written claim therefor, refund or credit any tax, where on the fact of the return upon which payment has been made, such payment appears clearly to have been erroneously paid. 48 As applied to the present case, the Court holds that petitioner timely filed its administrative and judicial claims for refund of excess and unutilized CWT, the relevant dates of which are summarized as follows: Date of Filing of Date of Filing of Last Day to File Date of Payment Administrative Petition for Review Both Claims Claim April 26, 2012 December 21, 2012 April 10, 2014 April 26, 2014 Petitioner's 2011 Annual ITR shows that the income from which the CWTs being claimed for refund were withheld was declared as part of its gross income. With regard to the second requisite, the Court was able to trace the income payments related to the substantiated CWT in the amount of Php12,938,601.20 to petitioner's General Ledger ("GL") for CY 2011, and notes that the same was reported in petitioner's Annual ITR for CY 2011. SICDAa In this regard, the Court agrees with the finding of the independent Certified Public Accountant that CWT amounting to Php226,570.47 was not traced to the GL or the official receipts/invoices, to wit: The CWT pertaining to revenue which has not been traced to the invoices and debit memos amounted to Php221,338.84 and the CWT pertaining to the revenue not traced to official receipts and credit memos amounted to Php5,231.63 or a total of Php226,570.47. 49 Moreover, the total amounts of sale of goods and services and other income booked by petitioner in its GL for CY 2011 tally with the amount of sales of goods and services and other income declared in petitioner's Annual ITRs for the said year, as shown below: Per General Ledger Per 2011 ITR Difference Exhibit Amount Exhibit Amount Sales "P-33-1," page 207 1,510,345,251.00 "P-3," line 16C 1,510,345,251.00 - Other Income "P-37-1," page 4 6,776,570.99 "P-3," line 19C 9,643,362.00 (2,866,791.01) The difference in "Other Income" was accounted for, as follows: 50 Reversal of Accrued Benefits Php5,000,000.00 Loss on Write off of CWT (2,976,065.00) Loss on Repossession (4,310,435.00) Interest Income (580,292.00) Total Php(2,866,792.00) 51 ============== The reconciliation table below shows that the taxable income indicated in petitioner's 2011 Annual ITR tallies with the reconciliation of taxable income per books against taxable income for CY 2011, thus: Net Taxable Income/(Net Loss) Php(378,068,762.00) 52 Per 2011 ITR Net Taxable Income/(Net Loss) Php(378,068,762.00) 53 Per Reconciliation Schedule Difference - ============== Petitioner's excess and unutilized CWT for CY 2011 is duly substantiated. To prove its compliance with the third requisite, petitioner presented a Schedule/Summary of Creditable Taxes Withheld for the year 2011 54 and the related Certificates of Creditable Taxes Withheld at Source (BIR Form No. 2307) 55 duly issued to petitioner by various withholding agents for CY 2011, reflecting creditable withholding taxes in the total amount of Php13,165,172.56. 56 The creditable withholding taxes in the total amount of Php13,165,172.56 was included in petitioner's gross sales for CY 2011 in the amount of Php1,510,345,251.00 and Other Income in the amount of Php9,643,362.00, as reflected in petitioner's 2011 Annual ITR. 57 Having complied with the requisites provided for the granting of a claim for refund or issuance of a TCC for excess and unutilized CWT, and considering petitioner's option (as indicated in its 2011 Annual ITR) to have a TCC issued for the same, the Court holds that petitioner is entitled to the issuance of TCC for its excess and unutilized CWT in the amount of Php12,938,601.20, broken down as follows: CWT per Claim Php13,165,171.67 Disallowed CWT (Not Traced to Petitioner's Income) 226,570.47 Substantiated Unutilized CWT for CY 2011 Php12,938,601.20 ============== WHEREFORE ,premises considered, the Petition for Review is hereby PARTIALLY GRANTED .Respondent Commissioner of Internal Revenue is hereby ORDERED to ISSUE A TAX CREDIT CERTIFICATE in favor of petitioner Univation Motor Philippines, Inc. in the reduced amount of TWELVE MILLION NINE HUNDRED THIRTY-EIGHT THOUSAND SIX HUNDRED ONE AND 20/100 PESOS (Php12,938,601.20) representing petitioner's excess and unutilized creditable withholding tax for calendar year 2011. SO ORDERED . (SGD.) LOVELL R. BAUTISTA Associate Justice Esperanza R. Fabon-Victorino and Ma. Belen M. Ringpis-Liban, JJ., concur. Footnotes 1. Formerly, Nissan Motor Philippines, Inc.,in a Minute Resolution promulgated on March 4, 2015 ( see Records, CTA Case No. 8797, Vol. 1 ,p. 520),the Court resolved that by virtue of the change in petitioner's corporate name, all orders, resolutions, decision, and other processes shall be entitled "Univation Motor Philippines, Inc. v. Commissioner of Internal Revenue." 2. Records, Vol. 1, Petition for Review ("PFR") ,pp. 14-130, with annexes. 3. A.M. No. 05-11-07-CTA (2005). Section 3 (a) (1), Rule 4 of the Revised Rules of the Court of Tax Appeals provides: Sec. 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. Records, Vol. 1, Joint Stipulation of Facts and Issues ("JSFI") ,p. 401. 5. Id. at 401-402. 6. Id. at 402. 7. Id. 8. Records, Vol. 2, Exhibit "P-3," BIR Form No. 1702 (Manual) ,pp. 605-617, with annexes. 9. Records, Vol. 2, Exhibit "P-4," BIR Form No. 1702 (Electronic) ,pp. 618-625. 10. Id. at 618. 11. Id. at 622. 12. Id.,Exhibit "P-16," Administrative Claim ,pp. 758-767, with annexes. 13. Records, Vol. 1, PFR ,pp. 14-130, with annexes. 14. Records, Vol. 1, Answer ,pp. 139-150. 15. Id.,Answer ,pp. 140-148; emphases retained. 16. Records, Vol. 1 ,pp. 140-148. 17. Id. at 363-367. 18. Id. at 377-387. 19. Id. at 401-407. 20. Id. at 425-431. 21. Records, Vol. 2 ,pp. 555-581. 22. Id. at 775-777. 23. Id. at 796-802. 24. Id. at 810-812. 25. Id. at 778; see pp. 786-787. 26. Id. at 810-812. 27. Records, Vol. 2 ,pp. 813-826. 28. Id. at 832-850. 29. Records, Vol. 2 ,p. 852. 30. Records, Vol. 1, Pre-Trial Order ,p. 426. 31. Underscoring ours. 32. Records, Vol. 2, Exhibit "P-3," pp. 605-611. 33. Id.,Line 33R ,p. 606. 34. Id.,Line 33A ,p. 606. 35. Id.,Lines 33F and 33H ,p. 606. 36. Id. at 605-606. 37. First Three Quarters Php10,132,336.00; Fourth Quarter Php3,032,835.67. 38. ICPA Box 7, Folder 68, Exhibits "P-44-1" to "P-44-220." 39. Subject claim in CTA Case No. 8420 in the amount of Php14,242,888.00. 40. Subject claim in CTA Case No. 8637 in the amount of Php12,868,745.00. 41. Subject claim in CTA Case No. 8797 in the amount of Php13,165,171.67. 42. Records, Vol. 2, Exhibit "P-11," Line 33A ,p. 729; with 0.02 rounding-off difference. 43. Id.,Exhibit "P-3," Line 37 ,p. 606. 44. Id.,Exhibit "P-3-A," p. 606. 45. Id.,Exhibit "P-11," Line 33A ,p. 729. 46. Id.,Exhibit "P-11," pp. 728-733. 47. G.R. No. 155682, March 27, 2007, 519 SCRA 93. 48. Underscoring ours. 49. ICPA Report, Exhibit "P-18," Summary of Findings ,p. 2, par. 7. 50. Id. ,p. 8, par. 24. 51. With 0.99 rounding-off difference. 52. Records, Vol. 2, Exhibit "P-3," Line 26C ,p. 606. 53. ICPA Box 7, Folder 67, Exhibit "P-40." 54. ICPA Box 1, Folders 1 & 2, Exhibits "P-31" and "P-32." 55. Id.,Folders 2 & 3, Exhibits "P-32-1" to "P-32-494." 56. With 0.89 rounding-off difference. 57. Records, Vol. 2, Exhibit "P-3," Lines 16C and 19C ,p. 605.