CBK Power Company Limited v. Commissioner of Internal Revenue

THIRD DIVISION [C.T.A. CASE NO. 7771. December 3, 2010.] CBK POWER COMPANY LIMITED , petitioner , vs . COMMISSIONER OF INTERNAL REVENUE , respondent . [C.T.A. CASE NO. 7814. December 3, 2010.] CBK POWER COMPANY LIMITED , petitioner , vs . COMMISSIONER OF INTERNAL REVENUE , respondent . DECISION COTANGCO-MANALASTAS , J p : THE CASE This resolves the consolidated Petitions for Review both filed by CBK Power Company Limited on April 23, 2008 and July 24, 2008, pursuant to Section 11 of Republic Act No. 1125 (R.A. 1125), as amended by Section 9 of R.A. No. 9282, and Section 3 (a), Rule 8 of the 2005 Revised Rules of the Court of Tax Appeals (RRCTA), praying for the issuance of tax credit certificates (TCCs) allegedly representing its unutilized input Value Added Taxes (VAT). For CTA Case No. 7771 filed on April 23, 2008, the amount of SEVEN MILLION FIVE HUNDRED FIFTY NINE THOUSAND NINE HUNDRED FORTY THREE AND 44/100 PESOS (P7,559,943.44) representing unutilized input VAT paid on its domestic purchases of goods and services, which are attributable to zero-rated sales for the period January 1, 2006 to March 31, 2006; 1 and for CTA Case No. 7814 filed on July 24, 2008, the amount of THIRTY SIX MILLION TWO HUNDRED FORTY SIX THOUSAND SIX HUNDRED SIX AND 28/100 PESOS (P36,246,606.28), representing unutilized input VAT paid on its domestic purchases of goods and services, which are attributable to zero-rated sales for the period April 1, 2006 to December 31, 2006. 2 THE PARTIES Petitioner is a partnership duly organized and existing under and by virtue of the laws of the Philippines, with principal office at the NPC Compound, Kalayaan, Laguna. Respondent, on the other hand, is the Commissioner of Internal Revenue, who is charged with the authority to act as such, including inter alia, the power to decide and grant refunds or tax credit or erroneously or illegally collected internal revenue taxes, as provided by law, with office at the Bureau of Internal Revenue (BIR) National Office Building, Diliman, Quezon City, where he may be served with summons and other court processes. 3 THE FACTS The facts of the case, as culled from the records, are as follows: Petitioner is a special purpose entity, the sole purpose of which is to engage in all aspects of (a) design, financing, construction, testing, commissioning, operation, maintenance, management and ownership of Kalayaan II pumped-storage hydroelectric power plant, the new Caliraya Spillway, and other assets located in the Province of Laguna, and (b) rehabilitation, upgrade, expansion, testing, commissioning, operation, maintenance and management of the Caliraya, Botocan and Kalayaan I hydroelectric power plants and their related facilities, located in the Province of Laguna. It generates electricity through its Caliraya, Botocan, and Kalayaan I hydroelectric power plants, as well as from the Kalayaan II hydroelectric power plant. 4 Petitioner is registered as a VAT entity, with TIN/VAT No. 205-760-474-000, in accordance with the Tax Code, as amended. It was issued BIR Certificate of Registration OCN 1RC0000050243, dated April 10, 2000, by BIR Revenue District Office No. 55 (San Pablo City, Laguna), which was updated on May 11, 2005. As a consequence thereof, petitioner was issued BIR Certificate of Registration OCN 1RC0000195405. 5 AICDSa Petitioner was also issued by the Energy Regulatory Commission the following Certificates of Compliance: (1) COC No. 04-02-GXT49A-0050, dated April 11, 2007; (2) COC No. 04-02-GXT49B-0051, dated February 4, 2004; (3) COC No. 04-02-GXT49C-0052, dated February 4, 2004; and (4) COC No. 05-10-GN12-13354-13373, dated April 11, 2007. 6 On March 17, 2006, BIR issued BIR Ruling No. DA-146-2006, confirming petitioner's claim that as an entity engaged in hydropower generation, its billings/fees for the sale of electricity to NPC are subject to VAT at zero percent (0%) rate, under Section 108 (B)(7) of the Tax Code of 1997, as amended by Republic Act 9337 (R.A. 9337). 7 For the period January 1, 2006 to December 31, 2006, petitioner filed with the BIR its Monthly VAT Declarations and Quarterly VAT Returns. Petitioner filed its Original Quarterly VAT Returns for the first, second, third, and fourth quarters of Calendar Year (CY) 2006 and Amended Quarterly VAT Returns for the four quarters of CY 2006 on the following dates: 8 2006 Original VAT Return Amended VAT Return Taxable Quarter (Date filed) (Date filed) 1st April 25, 2006 December 28, 2007 March 31, 2008 2nd July 25, 2006 April 18, 2008 3rd October 20, 2006 May 7, 2008 4th January 24, 2007 July 21, 2008 Petitioner's Amended Quarterly VAT Returns for the four quarters of CY 2006 reflected/reported the following input tax credits: 9 Input Tax Credits for the period January 1 to December 31, 2006 2006 Purchase of Domestic Importation Domestic Services Total Input Taxable Capital Purchases of Goods Purchase of Rendered Tax Credits Quarter Goods of Goods Other than Services by Non- exceeding Other than Capital Residents P1Million Capital Goods Goods 1st 1,870,700.70 1,821,359.38 556,816.00 4,151,387.81 968,642.68 9,368,906.57 2nd 1,346,348.83 1,209,055.08 1,152,424.00 5,797,606.67 1,199,547.36 10,704,981.94 3rd 2,998,466.11 1,425,019.73 810,906.00 10,921,541.86 302,627.14 16,458,560.84 4th 344,377.46 1,620,670.63 654,763.00 8,586,528.36 1,608,644.90 12,814,984.35 TOTAL 6,559,893.10 6,076,104.82 3,174,909.00 29,457,064.70 4,079,462.08 49,347,433.70 ========= ========== ========== ========== ========= ========== Also, based on the Amended Quarterly VAT returns for the Period January 1 to December 31, 2006, petitioner's reported zero-rated sales during the period are as follows: 10 Zero-Rated Sales for the period January 1 to December 31, 2006 2006 Taxable Quarter Zero-Rated Sales/Receipts 1st 1,583,390,407.46 2nd 1,648,748,033.50 3rd 1,599,882,354.64 4th 1,547,858,529.27 TOTAL 6,379,879,324.87 =========== Out of the total input tax reported in the Amended Quarterly VAT returns for the period January 1 to December 31, 2006, amounting to P49,347,433.70, petitioner is seeking issuance of TCCs for a total amount of P43,806,549.72 ( i.e., P7,559,943.44 for CTA Case No. 7771 and P36,246,606.28 for CTA Case No. 7814 ) CTA Case No. 7771 On March 31, 2008, petitioner filed its administrative claim 11 with the BIR RDO No. 55 of Laguna for the issuance of a TCC in the total amount of P7,559,943.44, representing its unutilized input taxes for the period January 1, 2006 to March 31, 2006, pursuant to Section 112 (A) of the NIRC of 1997, as amended by R.A. 9337. 12 Since respondent has not issued its final decision on the above administrative claim, petitioner filed on April 23, 2008 a Petition for Review 13 with this Court, docketed as CTA Case No. 7771, alleging inaction of respondent. 14 In his Answer, 15 respondent alleged by way of special and affirmative defenses that: "5. Petitioner's alleged claim for the issuance of a tax credit certificate is subject to administrative investigation/examination by respondent's Bureau; 6. Petitioner failed to demonstrate that the tax subject of the case at bar was erroneously or illegally collected; 7. Taxes collected are presumed to be in accordance with laws and regulations; 8. Petitioner's judicial claim for the issuance of a TAX CREDIT CERTIFICATE was prematurely filed in view of Section 112 (C) of the 1997 National Internal Revenue Code (1997 NIRC), as amended, which provides that: 'Section 112. Refunds or Tax Credits of Input Tax. (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.' (Italics supplied) Hence, when the petitioner filed its administrative claim for the issuance of a TAX CREDIT CERTIFICATE with the BIR Revenue District Office No. 55 of Laguna on 31 March 2008, respondent had 120 days within which to decide on petitioner's claim for the issuance of a TAX CREDIT CERTIFICATE. And in the case of full or partial denial of the claim or failure of respondent to act on the application within the 120 day period, petitioner has 30 days to appeal the decision or inaction with the Court of Tax Appeals. Thus, respondent had to render a decision within 120 days from 31 March 2008 or until 29 July 2008. In the event that respondent failed to act upon petitioner's claim for the issuance of a tax credit certificate, petitioner has 30 days from 29 July 2008 or until 28 August 2008 to appeal the unacted claim with the Court of Tax Appeals. Petitioner filed the instant Petition for Review with the Court of Tax Appeals on 23 April 2008, more than four (4) months before the lapse of the period allowed by law to file the judicial claim for the issuance of a tax credit certificate with the Court of Tax Appeals. DcaSIH In the case at bar, petitioner seeks the issuance of a tax credit certificate representing its alleged unutilized input taxes. Thus, petitioner can appeal to this Honorable Count only after the expiration of the 120-day period granted by law or within 30 days from the decision of respondent denying its claim for tax credit. This being so, this Honorable Court has no jurisdiction to act on the instant Petition for Review. 9. Assuming in gratia argumenti that petitioner's judicial claim for the issuance of a tax credit certificate was not prematurely filed, it is imperative for petitioner to prove compliance with the following, viz.: a. The registration requirements of a value-added taxpayer under the pertinent provision of the 1997 NIRC, as amended, and its implementing revenue regulations; b. The invoicing and accounting requirements for VAT registered persons, as well as the filing and payment of VAT pursuant to the provisions of Sections 113 and 114 of the 1997 NIRC, as amended. Failure to comply with the invoicing requirements on the documents supporting the sale of goods and services will result in the disallowance of the claim for input tax of the taxpayer claimant (Revenue Memorandum Circular No. 42-2003); c. The submission of complete documents in support of the administrative claim for refund pursuant to Section 112 (C) of the 1997 NIRC, as amended, otherwise, there would be no sufficient compliance with regard to the filing of administrative claim for tax credit/refund which is a condition sine qua non prior to the filing of judicial claim in accordance with Section 229 of the 1997 NIRC, as amended; d. That the input taxes of P7,559,943.44 allegedly representing unutilized input VAT from its local purchases and/or importation of goods and services and payments for services rendered by non-residents, other than capital goods, and purchases of capital goods, were: i. paid by the petitioner; ii. attributable to its zero-rated or effectively zero-rated sales; and iii. such input taxes paid should not have been applied against any output tax; e. That petitioner's claim for tax credit or refund of the unutilized input tax (VAT) in the amount of P7,559,943.44 was filed within two (2) years after the close of the taxable quarter when the sales were made in accordance with Section 112 (A) of the 1997 NIRC, as amended; f. That petitioner has complied with the governing rules and regulations with reference to recovery of tax erroneously or illegally collected as explicitly provided in Sections 112 (A) and 229 of the 1997 NIRC, as amended. 10. Moreover, in an action for tax credit/refund, the burden of proof rests upon the taxpayer to establish by sufficient and competent evidence its entitlement to a claim for tax credit/refund; 11. Basic is the rule that tax refunds are in the nature of tax exemptions and are to be construed strictissimi juris against the entity claiming the same ( Philippine Geothermal, Inc. vs. Commissioner of Internal Revenue, G.R. No. 154028, July 27, 2005). Moreover, statutes in derogation of sovereignty such as those containing exemption from taxation should be strictly construed in favor of the State. In this regard, taxation is the rule and exemption is the exception. The law does not look with favor on tax exemptions and that he who would seek to be thus privileged must justify it by words too plain to be mistaken and too categorical to be misinterpreted ( Sea-Land Services, Inc. vs. Court of Appeals, 357 SCRA 444)." CTA Case No. 7814 On July 23, 2008, petitioner filed with the BIR RDO No. 55 of Laguna an administrative claim 16 for the issuance of a TCC for the total amount of P36,246,606.28, representing its unutilized input taxes for the period April 1, 2006 to December 31, 2006, pursuant to Section 112 (A) of the NIRC of 1997, as amended by R.A. 9337. 17 On July 24, 2008, petitioner filed a Petition for Review 18 with this Court, docketed as CTA Case No. 7814, in order to toll the running of the two (2) year prescriptive period. 19 In his Answer filed on September 18, 2008, respondent alleged by way of special and affirmative defenses that: "5. Petitioner's claim for tax refund is subject to administrative investigation/examination by respondent; 6. Taxes remitted to the BIR are presumed to have been made in the regular course of business and in accordance with the provision of law; 7. To support its claim, it is imperative for petitioner to prove the following, viz.: a. The registration requirements of a value-added taxpayer in compliance with the pertinent provision of the National Internal Revenue Code of 1997 (1997 NIRC), as amended, and its implementing revenue regulations; EHSTcC b. The invoicing and accounting requirements for VAT-registered persons, as well as the filing and payment of VAT pursuant to the provisions of Sections 113 and 114 of the 1997 NIRC, as amended; c. Proof of compliance with the submission of complete documents in support of the administrative claim for refund pursuant to Section 112 (C) of the 1997 NIRC, as amended, otherwise there would be no sufficient compliance with the filing of administrative claim for refund which is a condition sine qua non prior to the filing of judicial claim in accordance with Section 229 of the 1997 NIRC, as amended; d. That the input taxes of Php36,246,606.28 representing unutilized input tax (VAT) from its local purchases and/or importation of goods and services and payments for services rendered by non-residents, other than capital goods for the period April 1, 2006 to December 31, 2006 were: d.i. paid by the petitioner; d.ii. attributable to its zero-rated or effectively zero-rated sales; and d.iii. such have not been applied against any output tax; e. That petitioner's claim for tax credit or refund of the unutilized input tax (VAT) was filed within two (2) years after the close of the taxable quarter when the sales were made in accordance with Section 112 (A) of the 1997 NIRC, as amended; f. That petitioner's domestic purchases and/or importation of goods and services, payment for services rendered by non-residents and capital goods were made in the course of its trade or business, properly supported by VAT invoices and/or official receipts and other documents, such as subsidiary purchase journal, showing that it actually paid VAT in accordance with Sections 110 (A) (2) and 113 of the 1997 NIRC, as amended and in pursuance to Section 4.104-5(a) & (b) of Revenue Regulations No. 7-95 (Re: Substantiation of Claims for Input Tax Credit); g. That petitioner has complied the requirements as enumerated under Section 4.104-2 of the Revenue Regulations 7-95 (Re: persons who can avail of the Input Tax Credit). 8. 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 tax refund/credit. This is so because exemptions from taxation are highly disfavored in law and he who claims exemptions must be able to justify his claim by the clearest grant of organic or statutory law. An exemption from common burden cannot be permitted to exist upon vague implications; 9. The claims for refund are construed strictly against the claimant for the same partakes the nature of exemption from taxation and liberally in favor of the taxing authority." On October 20, 2008, petitioner filed a Motion for Consolidation of Cases 20 praying for the consolidation of CTA Case No. 7814 with CTA Case No. 7771, which the Court granted in a Resolution 21 dated November 27, 2008. The parties filed their Joint Stipulation of Facts and Issues 22 on February 2, 2009, which was approved by this Court in a Resolution dated February 9, 2009, thus the Pre-Trial was terminated and the parties were ordered to proceed with the trial on the merits. During the hearing held on April 1, 2009, Mr. Fernando J. Dela Paz, Chief Financial Officer of the petitioner, testified on direct examination by way of affidavit, he affirmed the veracity of the declarations made in his affidavit and identification of Exhibits "A" to "E-3", inclusive of all submarkings. Considering the absence of the respondent's counsel despite notice, and as moved by petitioner's counsel, the right of the respondent's counsel to cross-examine Mr. Dela Paz was declared by this Court as deemed waived. In the same hearing, the petitioner's Motion to Commission Mr. Edwin F. Ramos of Constantino Guadalquiver & Company, as the Independent Certified Public Accountant (CPA) who will conduct the audit and verification of the aforesaid official receipts, invoices and other pertinent documents, was granted. 23 On July 24, 2009, Mr. Edwin F. Ramos, commissioned Independent CPA to conduct the independent special audit and examination of petitioner's voluminous documents, submitted his Sworn Statement. 24 The testimony of Mr. Ramos was taken during the hearing held on July 29, 2009, where he affirmed the veracity of his declarations in his Sworn Statement and identification of Exhibits "G" to "W", "Y" and "AA", inclusive of all sub-markings. 25 Petitioner filed its Formal Offer of Evidence 26 on October 26, 2009, offering Exhibits "A" to "BB-1", inclusive of all submarkings. The exhibits were all admitted by the Court in a Resolution 27 dated November 25, 2009. On April 21, 2010, counsel for respondent manifested that he will no longer present any witness and that he is resting his case, thus, the parties were ordered to file their respective Memoranda, within thirty (30) days or until May 21, 2010; afterwhich, the cases shall be deemed submitted for decision. 28 Considering Petitioner's Memorandum 29 filed on May 17, 2010, and the Report 30 of the Judicial Records Division dated June 3, 2010 that respondent failed to file his memorandum despite due notice, the cases were deemed submitted for decision on June 7, 2010. 31 TEacSA THE ISSUES Following are the issues, as stipulated upon by the parties, for this Court's resolution: "1. Whether or not Petitioner's administrative and judicial claims for the issuance of tax credit certificates were filed on time; 2. Whether or not Petitioner is registered as a value-added taxpayer pursuant to the provisions of the 1997 NIRC, as amended; 3. Whether or not Petitioner has complied with the invoicing and accounting requirements for VAT-registered persons, as well as the filing and payment of VAT pursuant to the provisions of Sections 113 and 114 of the 1997 NIRC, as amended; 4. Whether or not Petitioner has submitted complete documents in support of its administrative claims for the issuance of tax credit certificates pursuant to Section 112(C) of the 1997 NIRC, as amended; 5. Whether or not the alleged input taxes in the amount of P43,806,549.72 representing unutilized input VAT from local purchases and/or importation of goods and services and payments for services rendered by non-residents and purchases of capital goods were: i. paid or incurred by Petitioner; ii. attributable to its zero-rated sales or effectively zero-rated sales; iii. such input taxes paid or incurred should not have been applied against any output tax; 6. Whether or not the input taxes claimed were carried over to the succeeding quarter or quarters in Petitioner's VAT returns; 7. Whether or not Petitioner is entitled to the issuance of tax credit certificates in the amount of P43,806,549.72 allegedly representing unutilized input VAT from local purchases and/or importation of goods and services and payments for services rendered by non-residents and purchases of capital goods for the period January 1, 2006 to December 31, 2006. The above issues revolve around the principal issue of whether petitioner is entitled to the issuance of TCCs in the total amount of P43,806,549.72, representing unutilized input VAT on local purchases and/or importation of goods and services and payments for services rendered by non-residents and purchases of capital goods attributable to its zero-rated sales for the period January 1, 2006 to December 31, 2006. Arguments of Petitioner CBK Power Company Limited 32 In this present Petitions for Review, petitioner CBK Power Company Limited maintains that its administrative and judicial claims for the issuance of TCCs for unutilized input taxes for the period January 1, 2006 to December 31, 2006, were seasonably filed citing Section 229 of the NIRC of 1997, as amended, which provides for the two-year period for judicially claiming tax refund/credit, and argued that the case of Atlas Consolidated Mining and Development Corporation v. Commissioner of Internal Revenue 33 ( " Atlas case") is the applicable jurisprudence in the pending petitions. Considering that the Atlas case was the prevailing jurisprudence at the time the subject administrative and judicial claims were filed, petitioner followed in good faith the doctrine enunciated therein that the two-year prescriptive period for filing a claim for refund/credit of input VAT on zero-rated sales and input tax on capital goods should be counted from the date of filing of the VAT return and payment of the tax due. The case of Commissioner of Internal Revenue v. Mirant Pagbilao Corporation (Formerly Southern Energy Quezon, Inc.) 34 ( "'Mirant case " ) should be given prospective application following the principle of prospectivity of statutes. With regard to the second issue, petitioner contends that it is a value-added taxpayer pursuant to the provisions of the Tax Code of 1997, as amended. In the Joint Stipulation of Facts and Issues (JSFI) 35 filed by both parties on February 2, 2009, respondent had admitted that petitioner is registered as a VAT entity in accordance with the Tax Code of 1997. As regards the remaining issues, which all boil down to the issue of whether or not petitioner is entitled to the issuance of TCCs, petitioner asserts that it had sufficiently proven and substantiated that it has complied with all the basic requirements in order to be entitled to the issuance of TCCs in the amount of P43,806,549.72 representing unutilized input VAT from local purchases and/or importation of goods and services and payments for services rendered by non-residents and purchases of capital goods for the period January 1, 2006 to December 31, 2006. Arguments of Respondent Commissioner of Internal Revenue Respondent CIR strongly contends that petitioner's judicial claims for the issuance of TCCs were prematurely filed in view of Section 112 (C) of the NIRC of 1997, as amended by R.A. 9337, which essentially provides that the Commissioner shall grant a refund or issue the tax credit certificate for creditable input taxes within 120 days from the date of submission of complete documents in support of the application. Hence, the petitioner can elevate his claim before this Court only after the expiration of the 120-day period granted by law or within 30 days from the decision of the respondent denying its claim for tax credit. THE RULING OF THE COURT Section 112 (A) of the NIRC of 1997, as amended, provides for the refund or tax credit of unutilized input VAT attributable to zero rated or effectively zero-rated sales, to wit: 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. Based on the afore-quoted provision and settled jurisprudence, a taxpayer engaged in zero-rated or effectively zero-rated transactions may apply for tax refund or issuance of TCC for unutilized input VAT provided, the following requisites are satisfied: (1) the taxpayer is VAT registered; (2) the taxpayer is engaged in zero-rated or effectively zero-rated sales; (3) the input taxes were incurred or paid; (4) the input taxes have not been applied against output taxes during and in the succeeding quarters; (5) the input taxes claimed are attributable to zero-rated or effectively zero-rated sales; (6) the claim was applied/filed within the period prescribed in Section 112(A) and (C) of the NIRC of 1997, as amended. Timeliness of Petitioner's administrative and judicial claims for the issuance of tax credit certificates. Before this Court proceeds to determine petitioner's compliance with the 1st to 5th requisites for tax refund and issuance of TCCs, the Court deems it appropriate and opts to first dwell on the 6th requisite, which is in fact the first (1st) issue in this case, pertaining to the timeliness of petitioner's administrative and judicial claims for the issuance of TCCs, seeing that the resolution of this controversy is the determining factor on whether this Court should proceed with the disquisition of the other issues in this case. On the following dates, petitioner filed its Original and Amended Quarterly VAT Returns, 36 and its administrative 37 and judicial claims for the issuance of TCCs: SacDIE Taxable Return VAT Return Claim Review Quarter (Date filed) (Date filed) (Date filed) (Date filed) 1st April 25, 2006 December 28, March 31, April 23, 2008 2007 2008 March 31, 2008 2nd July 25, 2006 April 18, 2008 July 23, 2008 July 24, 2008 3rd October 20, May 7, 2008 2006 4th January 24, July 21, 2008 2007 Respondent, Commissioner of Internal Revenue, contends that petitioner's judicial claims for the issuance of TCCs were prematurely filed in view of Section 112 (C) of the NIRC of 1997, as amended by R.A. 9337, which provides that: SEC. 112. Refunds or Tax Credits of Input Tax. (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. Respondent posits that petitioner can appeal to this Honorable Court only after the expiration of the 120-day period granted by law or within 30 days from the decision of the respondent denying its claim for tax credit. This being so, according to the respondent, this Court has no jurisdiction to act on the Petitions for Review. The issue concerning the timeliness of petitioner's administrative and judicial claims, for input tax refund or the issuance of TCCs, brought forth divergent views on the following: First , reckoning of the 2-year period for filing/claiming refund or issuance of TCC provided under Section 112 (A) of the NIRC of 1997, as amended by R.A. 9337 ; Second , whether the 2-year period mandated under Section 112 (A) of the NIRC of 1997, as amended by R.A. 9337, refers to the filing of both administrative and judicial claim. Third , whether the non-observance of the 120-day period and 30-day period under Section 112 (C) of the NIRC of 1997, as amended by R.A. 9337, prior to the filing of Petition for Review amounts to non-exhaustion of administrative remedy and thereby results to lack of jurisdiction of this Court. However, the Supreme Court finally put to rest the controversies as above-mentioned when it ruled in the case of Commissioner of Internal Revenue v. Aichi Forging Company of Asia, Inc., G.R. No. 184823 ( "Aichi case") on October 6, 2010, as follows: First , the reckoning of the 2-year period for filing/claiming refund or issuance of TCC as expressly provided for under Section 112(A) of the NIRC of 1997, as amended by R.A. 9337, is from the close of the quarter when such sales were made. In the Aichi case, the Supreme Court adhered to the principle enunciated in the Mirant case notwithstanding the fact that the claim for refund was filed on September 30, 2004, approximately 4 years before the Mirant case was promulgated, effectively giving the Mirant doctrine a retroactive application. Second , 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 (C) 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. 38 Third , compliance with the "120-30 day period" under Section 112 (C) of the NIRC of 1997, as amended of R.A. 9337, is crucial in filing a judicial claim. AaHcIT Hence, applying the aforementioned jurisprudential principle with the prevailing circumstances in this case, this Court is constrained to DENY petitioner's claim for issuance of TCCs. The Court in Division finds the Petitions to be devoid of merit and the arguments of the respondent to be in order. Administrative claims were filed on time Apropos the administrative claim for refund or issuance of tax credit certificate for unutilized input tax, germane is the provision of Section 112 (A) of the NIRC of 1997, as amended by R.A. 9337, which prescribes the reckoning of the 2-year period within which to make a claim for refund or tax credit, i.e., from the close of the taxable quarter when the sales were made. By a plain reading of the foregoing provision, the 2-year prescriptive period for filing the application for refund/credit of input tax on zero-rated sales shall be determined from the close of the quarter when such sales were made. The Supreme Court, in the Aichi case, reinforced the doctrine laid down in the Mirant case, that the 2-year prescriptive period is reckoned from the close of the taxable quarter when the relevant sales or transactions were made, and significantly gave the said doctrine a retroactive application considering that the High Court applied the same to the Aichi case notwithstanding the fact that the claim for refund was filed on September 30, 2004, approximately 4 years before the Mirant case was promulgated. In the Aichi case, 39 the Supreme Court explained as follows: xxx xxx xxx The pivotal question of when to reckon the running of the two-year prescriptive period, however, has already been resolved in Commissioner of Internal Revenue v. Mirant Pagbilao Corporation, where we ruled that Section 112(A) of the NIRC is the applicable provision in determining the start of the two-year period for claiming a refund/credit of unutilized input VAT, and that Sections 204(C) and 229 of the NIRC are inapplicable as "both provisions apply only to instances of erroneous payment or illegal collection of internal revenue taxes." We explained that: The above proviso [Section 112 (A) of the NIRC] clearly provides in no uncertain terms that unutilized input VAT payments not otherwise used for any internal revenue tax due the taxpayer must be claimed within two years reckoned from the close of the taxable quarter when the relevant sales were made pertaining to the input VAT regardless of whether said tax was paid or not. As the CA aptly puts it, albeit it erroneously applied the aforequoted Sec. 112 (A), "[P]rescriptive period commences from the close of the taxable quarter when the sales were made and not from the time the input VAT was paid nor from the time the official receipt was issued." Thus, when a zero-rated VAT taxpayer pays its input VAT a year after the pertinent transaction, said taxpayer only has a year to file a claim for refund or tax credit of the unutilized creditable input VAT. The reckoning frame would always be the end of the quarter when the pertinent sales or transaction was made, regardless when the input VAT was paid. Be that as it may, and given that the last creditable input VAT due for the period covering the progress billing of September 6, 1996 is the third quarter of 1996 ending on September 30, 1996, any claim for unutilized creditable input VAT refund or tax credit for said quarter prescribed two years after September 30, 1996 or, to be precise, on September 30, 1998. Consequently, MPC's claim for refund or tax credit filed on December 10, 1999 had already prescribed. Reckoning for prescriptive period under Secs. 204(C) and 229 of the NIRC inapplicable To be sure, MPC cannot avail itself of the provisions of either Sec. 204(C) or 229 of the NIRC which, for the purpose of refund, prescribes a different starting point for the two-year prescriptive limit for the filing of a claim therefor. Secs. 204(C) and 229 respectively provide: 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, of any sum alleged to have been excessively or in any manner wrongfully 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. IHaSED 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 face of the return upon which payment was made, such payment appears clearly to have been erroneously paid. Notably, the above provisions also set a two-year prescriptive period, reckoned from date of payment of the tax or penalty, for the filing of a claim of refund or tax credit. Notably too, both provisions apply only to instances of erroneous payment or illegal collection of internal revenue taxes. MPC's creditable input VAT not erroneously paid For perspective, under Sec. 105 of the NIRC, creditable input VAT is an indirect tax which can be shifted or passed on to the buyer, transferee, or lessee of the goods, properties, or services of the taxpayer. The fact that the subsequent sale or transaction involves a wholly-tax exempt client, resulting in a zero-rated or effectively zero-rated transaction, does not, standing alone, deprive the taxpayer of its right to a refund for any unutilized creditable input VAT, albeit the erroneous, illegal, or wrongful payment angle does not enter the equation. xxx xxx xxx Considering the foregoing discussion, it is clear that Sec. 112 (A) of the NIRC, providing a two-year prescriptive period reckoned from the close of the taxable quarter when the relevant sales or transactions were made pertaining to the creditable input VAT, applies to the instant case, and not to the other actions which refer to erroneous payment of taxes. (Emphasis supplied.) In view of the foregoing, we find that the CTA En Banc erroneously applied Sections 114(A) and 229 of the NIRC in computing the two-year prescriptive period for claiming refund/credit of unutilized input VAT. To be clear, Section 112 of the NIRC is the pertinent provision for the refund/credit of input VAT. Thus, the two-year period should be reckoned from the close of the taxable quarter when the sales were made. xxx xxx xxx Petitioner filed its administrative 40 claims for the issuance of TCCs on the following dates: 2006 Close of the Last Day to File Date Taxable Quarter Administrative Administrative Quarter Claim Claim Filed 1st March 31, 2006 March 31, 2008 March 31, 2008 2nd June 30, 2006 June 30, 2008 July 23, 2008 3rd September 30, 2006 September 30, 2008 4th December 31, 2006 December 31, 2008 Clearly, applying the explicit provision of Section 112 (A) of the NIRC of 1997, as amended by R.A. 9337, as bolstered in the cases of Mirant and Aichi, the administrative claims were filed by the petitioner within the 2-year prescriptive period, except for the period covering the 2nd quarter of 2006. For the 2nd quarter of 2006, the mandated last day of filing of an administrative claim was set by law on June 30, 2008, however, petitioner filed its administrative claim on July 23, 2008, which is clearly beyond the 2-year prescriptive period under Section 112 (A) of the NIRC of 1997, as amended by R.A. 9337. The filing of the judicial claim was premature Regarding the judicial claim for refund, Section 112 (C) of the NIRC of 1997, as amended by R.A. 9337, is the relevant provision, viz.: "(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) hereon." "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." Section 112 (C) of the NIRC clearly provides that the CIR has "120 days from the date of the submission of the complete documents in support of the application [for tax refund/credit]," within which to grant or deny the claim. In case of full or partial denial by the CIR, the taxpayer's recourse is to file an appeal before the Court of Tax Appeals (CTA) within 30 days from receipt of the decision of the CIR. However, if after the 120-day period the CIR fails to act on the application for tax refund/credit, the remedy of the taxpayer is to appeal the inaction of the CIR to the CTA within 30 days. 41 In this case, records reveal that: CTA Case Administrative End of 120 Days Date Judicial Claim Filed for the BIR Claim Filed Commissioner to Decide the claim CTA Case No. March 31, 2008 July 29, 2008 April 23, 2008 7771 CTA Case No. July 23, 2008 November 20, July 24, 2008 7814 2008 Verily, in both petitions, petitioner did not wait for the decision of the CIR or the lapse of the 120-day period before filing its appeal to this Court. For this reason, this Court finds the filing of the judicial claims for issuance of TCCs for unutilized input VAT, premature. HAaDTE Also, it is significant to note that, as clarified by the Supreme Court in the Aichi case, 42 the aforementioned 2-year period refers to applications for refund/credit filed with the CIR and not to appeals made to this Court (CTA). The Supreme Court ratiocinated in this wise: xxx xxx xxx Respondent's assertion that the non-observance of the 120-day period is not fatal to the filing of a judicial claim as long as both the administrative and the judicial claims are filed within the two-year prescriptive period has no legal basis. 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. With regard to Commissioner of Internal Revenue v. Victorias Milling, Co., Inc. relied upon by respondent, we find the same inapplicable as the tax provision involved in that case is Section 306, now Section 229 of the NIRC. And as already discussed, Section 229 does not apply to refunds/credits of input VAT, such as the instant case. In fine, the premature filing of respondent's claim for refund/credit of input VAT before the CTA warrants a dismissal inasmuch as no jurisdiction was acquired by the CTA. xxx xxx xxx This Court adheres to the ruling of the Supreme Court in the case of Commissioner of Internal Revenue v. Aichi Forging Company of Asia, Inc., G.R. No. 184823, October 6, 2010. This is in keeping with the time-honored rule that the Supreme Court, by tradition and in our system of judicial administration, has the last word on what the law is. It is the final arbiter of any justiciable controversy. 43 All courts must take their bearings from the decisions of this Court. 44 To hold otherwise would not only offend the above-cited principles, but would altogether undermine the very foundations upon which the afore-cited principles were pronounced by the Supreme Court in the aforementioned decisions. Under the principle of stare decisis et non quieta movere, past judicial precedents should be followed in subsequent cases by all courts in the land. 45 Hence, the cases of Mirant 46 and Aichi 47 constitute as stare decisis to the case at bar. WHEREFORE, premises considered, the instant Petitions for Review are hereby DISMISSED for having been prematurely filed. (SGD.) AMELIA R. COTANGCO-MANALASTAS Associate Justice Olga Palanca-Enriquez, J., concurs. Lovell R. Bautista, J., with dissenting opinion. Separate Opinions BAUTISTA , J., dissenting opinion : Consistent with my stand that the taxpayer-claimant has the option of seeking judicial redress for refund or tax credit of excess or unutilized input tax with this Court either within thirty (30) days from receipt of the denial of its claim, or after the lapse of the one hundred twenty (120)-day period in the event of inaction by the Commissioner, provided that both the administrative and judicial remedies must be undertaken within the two (2)-year prescriptive period, I am compelled to register my dissent on the dismissal of the Petitions for Review for having been prematurely filed. With all due respect to the members of the Court, it is my considered view that if the 2-year prescriptive period under Sections 112 and 229 of the 1997 National Internal Revenue Code ("NIRC") is about to expire, there is no need to wait for the denial of the claim by the Commissioner of Internal Revenue or its inaction after the expiration of the 120-day period before the taxpayer-claimant can lodge its appeal with this Court, 1 for beyond that period, the taxpayer can no longer appeal to this Court. 2 In the case of Commissioner of Internal Revenue v. San Roque Power Corporation, 3 the Court En Banc aptly penned as follows: Corollary thereto, the Honorable Court of Appeals has ruled that when the 2-year prescriptive period is about to prescribe and the claim for refund with the Commissioner of Internal Revenue has not been acted upon by him, for the protection of the interest of the taxpayer, the latter should file a Petition for Review with the Court of Tax Appeals within the said 2-year period; otherwise, if the decision of the Commissioner is adverse to the taxpayer and it was made after the 2-year period, he can no longer appeal the same to the Court of Tax Appeals. The Court of Appeals ratiocinated in this wise: "It appears therefore, that it is not necessary for the Commissioner of Internal Revenue to first act unfavorably on the claim for refund before the Court of Tax Appeals could validly take cognizance of the case. This is so because of the positive mandate of Section 230 of the Tax Code and also by virtue of the doctrine that the delay of the Commissioner in rendering his decision does not extend the reglementary period prescribed by statute. Incidentally, the taxpayer could not be faulted for taking advantage of the full two-year period set by law for filing his claim for refund. Indeed, no provision in the tax code requires that the claim for refund be filed at the earliest instance in order to give the Commissioner an opportunity to rule on it and the court to review the ruling of the Commissioner of Internal Revenue on appeal. The law fixed the same period two years for filing a claim for refund with the Commissioner (Sec. 204, par. 3), and for filing of suit in court (Sec. 230), unlike in protests of assessment under Sec. 229 which fixed the period (thirty days from receipt of the decision) before an appeal could be made in court. Indeed, only the latter case presupposes the existence of a prior decision of the Commissioner which could be subjected to review by the court. In fact, the Court of Tax Appeals itself acknowledges that the claim for refund with the Commissioner could be pending simultaneously with a suit for refund filed before the former ( Commissioner of Internal Revenue vs. Bank of the Philippine Islands as Liquidator of Paramount Acceptance Corporation and the Court of Tax Appeals, CA-G.R. SP No. 34102, September 19, 1994 )." ECcTaH Even the Bureau of Internal Revenue cited the foregoing disquisition of the Court of Appeals as basis when it made the following ruling: "In reply, please be informed that a taxpayer-claimant need not wait for the lapse of the 120-day period before it could seek judicial relief with the CTA by way of Petition for Review. Neither is it required that the Commissioner should first act on the claim of a particular taxpayer before the CTA may acquire jurisdiction, particularly if the claim is about to prescribe. The Tax Code fixed the period of two (2) years for filing a claim for refund with the Commissioner [Sec. 112(A) in relation to Sec. 204(c)] and for filing a case in court [Section 229]. Hence, a decision of the Commissioner is not a condition or requisite before the taxpayer can resort to the judicial remedy afforded by law." More importantly, the Court En Banc has squarely and exhaustively ruled on this issue in this wise: "It is true that Section 112(D) of the abovementioned provision applies to the present case. However, what the petitioner failed to consider is Section 112(A) of the same provision. The respondent is also covered by the two (2) year prescriptive period. We have repeatedly held that the claim for refund with the BIR and the subsequent appeal to the Court of Tax Appeals must be filed within the two-year period. Accordingly, the Supreme Court held in the case of Atlas Consolidated Mining and Development Corporation vs. Commissioner of Internal Revenue that the two-year prescriptive period for filing a claim for input tax is reckoned from the date of the filing of the quarterly VAT return and payment of the tax due. If the said period is about to expire but the BIR has not yet acted on the application for refund, the taxpayer may interpose a petition for review with this Court within the two year period. In the case of Gibbs vs. Collector, the Supreme Court held that if, however, the Collector (now Commissioner) takes time in deciding the claim, and the period of two years is about to end, the suit or proceeding must be started in the Court of Tax Appeals before the end of the two-year period without awaiting the decision of the Collector. Furthermore, in the case of Commissioner of Customs and Commissioner of Internal Revenue vs. The Honorable Court of Tax Appeals and Planters Products, Inc., the Supreme Court held that the taxpayer need not wait indefinitely for a decision or ruling which may or may not be forthcoming and which he has no legal right to expect. It is disheartening enough to a taxpayer to keep him waiting for an indefinite period of time for a ruling or decision of the Collector (now Commissioner) of Internal Revenue on his claim for refund. It would make matters more exasperating for the taxpayer if we were to close the doors of the courts of justice for such a relief until after the Collector (now Commissioner) of Internal Revenue, would have, at his personal convenience, given his go signal. This Court ruled in several cases that once the petition is filed, the Court has already acquired jurisdiction over the claims and the Court is not bound to wait indefinitely for no reason for whatever action respondent (herein petitioner) may take. At stake are claims for refund and unlike disputed assessments, no decision of respondent (herein petitioner) is required before one can go to this Court." Lastly, it is apparent from the following provisions of Revenue Memorandum Circular No. 49-03 dated August 1[5], 2003, that petitioner knows that claims for VAT refund or tax credit filed with the Court can proceed simultaneously with the ones filed with the BIR and that taxpayers need not wait for the lapse of the subject 120-day period, to wit: "In response to request of selected taxpayers for adoption of procedures in handling refund cases that are aligned to the statutory requirements that refund cases should be elevated to the Court of Tax Appeals before the lapse of the period prescribed by law, certain provisions of RMC No. 42-2003 are hereby amended and new provisions are added thereto. In consonance therewith, the following amendments are being introduced to RMC No. 42-2003, to wit: I.) A-17 of Revenue Memorandum Circular No. 42-2003 is hereby revised to read as follows: In cases where the taxpayer has filed a "Petition for Review" with the Court of Tax Appeals involving a claim for refund/TCC that is pending at the administrative agency (Bureau of Internal Revenue or OSS-DOF), the administrative agency and the tax court may act on the case separately. While the case is pending in the tax court and at the same time is still under process by the administrative agency, the litigation lawyer of the BIR, upon receipt of the summons from the tax court, shall request from the head of the investigating/processing office for the docket containing certified true copies of all the documents pertinent to the claim. The docket shall be presented to the court as evidence for the BIR in its defense on the tax credit/refund case filed by the taxpayer. In the meantime, the investigating/processing office of the administrative agency shall continue processing the refund/TCC case until such time that a final decision has been reached by either the CTA or the administrative agency. If the CTA is able to release its decision ahead of the evaluation of the administrative agency, the latter shall cease from processing the claim. On the other hand, if the administrative agency is able to process the claim of the taxpayer ahead of the CTA and the taxpayer is amenable to the findings thereof, the concerned taxpayer must file a motion to withdraw the claim with the CTA. . . . ." ( Citations omitted ) Thus, the judicial recourse to this Court by a taxpayer-claimant within 30 days, either from the lapse of the 120-day period within which the Commissioner of Internal Revenue shall decide on the claim, or after the receipt of the decision denying the same, pursuant to Section 112 (C) 4 of the 1997 NIRC, as amended, is directory and permissive, and not mandatory nor jurisdictional, as long as it is made within the 2-year prescriptive period. 5 Likewise, I cannot concur to the unqualified application of the ruling in the case of Commissioner of Internal Revenue v. Mirant Pagbilao Corporation (Formerly Southern Energy Quezon, Inc.) 6 ("Mirant case"), since I maintain that rulings of the court modifying or reversing a doctrine or principle operates prospectively, and rights acquired under such doctrine or principle prior to its modification or reversal may not be affected thereby. 7 STcADa As I have exhaustively discussed in the case of Mindanao II Geothermal Partnership v. Commissioner of Internal Revenue, 8 a new doctrine should be applied prospectively and should not apply to parties who had relied on the old doctrine and acted in good faith, for to hold otherwise would be to deprive the law of its quality of fairness and justice then, if there is no recognition of what had transpired prior to such adjudication. 9 Judicial interpretation of a statute constitutes part of the law as of the date it was originally passed, since the court's construction merely establishes the contemporaneous legislative intent that the interpreted law carried into effect, subject only to the qualification that when a doctrine is overruled and a different view is adopted, and more so when there is a reversal thereof. 10 Thus, the ruling in the Mirant case that the reckoning of the 2-year prescriptive period is from the close of the taxable quarter should be applied prospectively i.e., only to administrative and judicial claims filed after September 12, 2008. In the case at bench, as well as for the administrative and judicial cases filed before the Supreme Court enunciated the ruling in the Mirant case, the prevailing jurisprudence then was that held in the case of Atlas Consolidated Mining and Development Corporation v. Commissioner of Internal Revenue ("Atlas case"), 11 wherein the 2-year prescriptive period is reckoned not from the close of the pertinent quarter but from the date of filing of the VAT return. With the foregoing in mind, petitioner had until the following dates within which to file its administrative and judicial claims, to wit: Period Date of Filing of End of the 2-Year Covered Returns Period (2006) 1st Quarter April 25, 2006 April 25, 2008 2nd Quarter July 25, 2006 July 25, 2008 3rd Quarter October 20, 2006 October 20, 2008 4th Quarter January 24, 2007 January 24, 2008 TOTAL Thus, the administrative claim for the first quarter filed on March 31, 2008 and the subsequent Petition for Review filed on April 23, 2008 docketed as CTA Case No. 7771; and the administrative claim for the second to the fourth quarters filed on July 23, 2008, and the Petition for Review filed on July 24, 2008 docketed as CTA Case No. 7814, were made within the prescribed period. Accordingly, I vote that the Petitions for Review be given its due course. aIcDCH Footnotes 1. Rollo, pp. 1-14, Petition for Review for CTA Case No. 7771. 2. Rollo, pp. 418-429, Petition for Review for CTA Case No. 7814. 3. Rollo, p. 230, Pars. 1 and 2, Facts Admitted, Joint Stipulation of Facts and Issues (JSFI). 4. Pars. 5 and 9, Facts Admitted, JSFI, Rollo, pp. 231-232. 5. Par. 6, Facts Admitted, JSFI, Rollo, p. 231. 6. Par. 10, Facts Admitted, JSFI, Rollo, p. 232. 7. Par. 11, Facts Admitted, JSFI, Rollo, pp. 232-233. 8. Pars. 7-8, Facts Admitted, JSFI, Rollo, pp. 231-232. 9. Exhibits "H-1" to "H-10". 10. Supra Note 8. 11. Exhibit "A". 12. Par. 12, Facts Admitted, JSFI, Rollo, p. 235. 13. Rollo, pp. 1-14. 14. Par. 14, Facts Admitted, JSFI, Rollo, p. 235. 15. Rollo, pp. 156-162. 16. Exhibit "B". 17. Par. 13, Facts Admitted, JSFI, Rollo, p. 235. 18. Rollo, pp. 418-429. 19. Par. 14, Facts Admitted, JSFI, Rollo, p. 235. 20. Rollo, pp. 185-188. 21. Rollo, p. 194. 22. Rollo, pp. 229-239. 23. Minutes of the hearing held by the Second Division on April 1, 2009; Rollo, p. 281. 24. Rollo, pp. 302-311. 25. Minutes of the hearing held by the Second Division on July 29, 2009; Rollo, p. 312. 26. Rollo, pp. 323-335. 27. Rollo, pp. 349-350. 28. Minutes of the hearing held by the Second Division on April 21, 2010; Rollo, p. 357. 29. Rollo, pp. 360-413. 30. Rollo, p. 415. 31. Rollo, p. 417, Resolution dated June 7, 2010. 32. Memorandum for the Petitioner, Rollo, pp. 360-413. 33. G.R. Nos. 141104 & 148763, June 8, 2007. 34. G.R. No. 172129, September 12, 2008. 35. Rollo, pp. 229-238. 36. Pars. 7-8, Facts Admitted, JSFI, Rollo, pp. 231-232. 37. Pars. 12-13, Facts Admitted, JSFI, Rollo, p. 235. 38. Commissioner of Internal Revenue v. Aichi Forging Company of Asia, Inc., G.R. No. 184823, October 6, 2010. 39. Supra note 38. 40. Pars. 12-13, Facts Admitted, JSFI, Rollo, p. 235. 41. Supra note 38. 42. Supra note 38. 43. Dante Nacuray, et al. vs. National Labor Relations Commission; G.R. Nos. 114924-27; 270 SCRA 9. 44. Systra Philippines, Inc. vs. Commissioner of Internal Revenue, G.R. No. 176290, Resolution dated September 21, 2007, 533 SCRA 776, 781. 45. Gregorio Castillo v. Sandiganbayan, G.R. No. 138231, 377 SCRA 509. 46. G.R. No. 172129; 565 SCRA 154, 171. 47. Supra note 38. BAUTISTA, J., dissenting opinion: 1. Commissioner of Internal Revenue v. CE Cebu Geothermal Power Company, Inc., CTA EB No. 426, May 29, 2009. 2. Commissioner of Internal Revenue v. Accenture, Inc., CTA EB No. 410 (CTA Case No. 7387), March 18, 2009. 3. CTA EB No. 408 (CTA Case No. 6647), March 25, 2009. 4. As amended by Republic Act No. 9337. 5. Commissioner of Internal Revenue v. Aichi Forging Company of Asia, Inc., CTA EB No. 416, February 4, 2009. 6. G.R. No. 172129, September 12, 2008, 565 SCRA 154. 7. People v. Jabinal, G.R. No. 30061, February 27, 1974, 55 SCRA 607. 8. CTA EB No. 513 (CTA Case Nos. 7227, 7287 and 7317), March 10, 2010, Concurring and Dissenting Opinion penned by Associate Justice Lovell R. Bautista, with Associate Justice Caesar A. Casanova, concurring. 9. Columbia Pictures, Inc., et al. v. Court of Appeals, et al., G.R. No. 110318, August 28, 1996, 261 SCRA 144. 10. Ibid. 11. G.R. Nos. 141104 & 148763, June 8, 2007, 524 SCRA 73.