Philex Mining Corp. v. Commissioner of Internal Revenue

SECOND DIVISION [C.T.A. CASE NOS. 7933 & 7968. May 11, 2011.] PHILEX MINING CORPORATION , petitioner , vs . COMMISSIONER OF INTERNAL REVENUE , respondent . RESOLUTION CASTAEDA, JR. , J p : This resolved petitioner's "Motion for Reconsideration" of the Decision dated March 17, 2011 filed on April 4, 2011 with respondent's "Comment" filed on April 18, 2011. The dispositive portion of the assailed Decision reads: cSaCDT " WHEREFORE , the instant Petition for Review in CTA Case Nos. 7933 and 7968 is hereby DENIED for having been prematurely filed. SO ORDERED ." In its motion, petitioner moves that the assailed Decision be reconsidered and an amended decision be rendered based on the evidence admitted. In support thereof, petitioner contends that the dismissal of its case is erroneous because the premature filing of the petition is not one of the instances under Section 1, Rule 9 of the Rules of Court wherein this Court can motu proprio dismiss the case. It states that the defense of "failure of the petitions to state a cause of action" due to premature filing thereof is deemed waived since the same was not raised as a special and affirmative defense when respondent filed her Answer. Hence, the Court has jurisdiction and the case should be decided on the merits. Furthermore, petitioner argues that it relied, in good faith, upon previous judicial doctrines, which provide that both judicial and administrative claim for refund should be filed within the two year prescriptive period. As such, the ruling of the Supreme Court in the case of Commissioner of Internal Revenue vs. Aichi Forging Company of Asia, Inc. 1 ("Aichi case") , which allegedly overturned previous judicial doctrines, should be applied prospectively. On the other hand, respondent, in her Comment, counter-argues that Section 1, Rule 9 of the Rules of Court provides the authority of the Court to motu proprio dismiss the case on the ground of lack of jurisdiction; that Section 112 (C) of the National Internal Revenue Code (NIRC) is clear and free from any ambiguity, hence, there is no room for construction or interpretation but only for its application; and that assuming the application of the ruling in the Aichi Case prejudiced the petitioner, this Court was merely following the ruling of the Supreme Court which is considered as the court of last resort and final arbiter of all legal questions properly brought before it. Based on the arguments of the parties, we find the instant Motion for Reconsideration to be devoid of merit. ITScAE By tradition and in our system of judicial administration, the Supreme Court has the last word on what the law is; it is the final arbiter of any justifiable controversy. There is only one Supreme Court from whose decisions all other courts should take their bearings. 2 It is the duty of the lower courts to obey the decisions of the Supreme Court and render obeisance to its status as the apex of hierarchy of courts. 3 The Supreme Court ruled, in the Aichi case , that "the premature filing of a claim for refund/credit of input VAT before the CTA warrants a dismissal inasmuch as no jurisdiction was acquired by the CTA." Such pronouncement demonstrates that in cases of input tax refund, the premature invocation of this Court's jurisdiction would warrant the dismissal of the case on the ground of lack of jurisdiction. Being a question of jurisdiction, the same can be taken up motu proprio by the Court. As regards the argument on the prospective application of the Aichi case , suffice to say that a cursory reading of the said case would reveal that the period to appeal before the CTA was determined pursuant to Section 112 (D) [now 112 (C)] of the NIRC. It was ruled in that case that the phrase "within two years" under Section 112 (A) of the NIRC refers to application for refund/credit with the Commissioner of Internal Revenue and not to appeals made to the CTA. The construction/interpretation placed upon Section 112 (A) and (D) of the NIRC in that Aichi case retroacts to the date of the enactment of the said law on January 1, 1998. As held in Philippine Constitution Association vs. Enriquez, 4 "the Court's interpretation of the law is part of the law as of the date of its enactment since the court's interpretation merely establishes the contemporary legislative intent that the construed law purports to carry into effect." WHEREFORE , the instant Motion for Reconsideration is hereby DENIED for lack of merit. SO ORDERED . (SGD.) JUANITO C. CASTAEDA, JR. Associate Justice Cielito N. Mindaro-Grulla, J. , concurs. Caesar A. Casanova, J. , is on leave. Footnotes 1. G.R. 184823, October 6, 2010. 2. Commissioner of Internal Revenue vs. Michel J. Lhuiller Pawnshop, Inc. , G.R. No. 150947, July 15, 2003 (406 SCRA 178) citing GSIS vs. Court of Appeals, 334 Phil. 163, 175; 266 SCRA 187 [1997], Ang Ping v. RTC of Manila, Br. 40, G.R. No. L-75860, 17 September 1987, 154 SCRA 77 and Tugade v. Court of Appeals, G.R. L-47772, 31 August 1978, 85 SCRA 226. 3. Commission on Higher Education vs. Atty. Felina S. Dasig , G.R. No. 172776, December 17, 2008; 574 SCRA 227. 4. G.R. No. 113105, August 19, 1994; 235 SCRA 506 citing People v. Licera, 65 SCRA 270 [1975] .