Manulife Data Services, Inc. v. Commissioner of Internal Revenue

FIRST DIVISION [C.T.A. CASE NOS. 8305, 8322, 8348 and 8408. July 1, 2016.] MANULIFE DATA SERVICES, INC. , petitioner , vs. COMMISSIONER OF INTERNAL REVENUE , respondent . DECISION UY , J p : The instant case is a consolidation of four (4) Petitions for Review filed by Manulife Data Services, Inc., seeking the refund or issuance of tax credit certificate (TCC) in the amount of P22,201,886.30, allegedly representing its excess and unutilized input value-added tax (VAT) paid for the four (4) quarters of calendar year (CY) 2009, broken down as follows: CTA Case Period Covered Amount No. (2009) 8305 1st Quarter P4,085,030.49 8322 2nd Quarter P5,736,852.20 8348 3rd Quarter P8,033,790.00 8408 4th Quarter P4,346,213.61 TOTAL P22,201,886.30 ============ THE FACTS Petitioner Manulife Data Services, Inc. is a foreign corporation duly registered with and licensed by the Securities and Exchange Commission (SEC) to operate as a Regional Operating Headquarter (ROHQ) under SEC Certificate of Registration No. FS200603505. 1 It is a VAT-registered entity since March 9, 2006. 2 Its registered address is at Manulife Building, UP North Science and Technology Park, Commonwealth Avenue, Diliman, Quezon City. 3 As an ROHQ, petitioner is engaged in the business of providing qualifying services to its affiliates and related parties in the Asia-Pacific Region and in other foreign markets. 4 On the other hand, respondent is the duly appointed Commissioner of the Bureau of Internal Revenue (BIR), with principal office at the 5th Floor, BIR National Office Building, Agham Road, Diliman, Quezon City. She is vested with the power to decide tax cases, including claims for refunds or tax credits. 5 CAIHTE For the year 2009, petitioner filed its original and amended Quarterly VAT Returns on the following dates: QUARTERLY VAT DATE FILED RETURNS (2009) 1st Quarter (Original) April 24, 2009 6 2nd Quarter (Original) July 24, 2009 7 2nd Quarter (Amended) August 4, 2009 8 3rd Quarter (Original) October 22, 2009 9 4th Quarter (Original) January 25, 2010 10 4th Quarter (Amended) March 19, 2010 11 Thereafter, petitioner filed with respondent, through the Revenue District Office (RDO) No. 38, applications for refund or issuance of tax credit certificate for its alleged excess/unutilized input VAT, on the following dates: 12 TAXABLE PERIOD DATE FILED AMOUNT (2009) 1st Quarter February 1, 2011 13 P4,085,030.49 2nd Quarter March 28, 2011 14 P5,736,852.20 3rd Quarter May 13, 2011 15 P8,033,790.00 4th Quarter August 12, 2011 16 P4,346,213.61 Respondent failed to rule on petitioner's applications for refund or issuance of TCC for its purported excess/unutilized input VAT for the four quarters of 2009. 17 Thus, petitioner filed separate Petitions for Review for the refund or issuance of TCC of its alleged excess and unutilized input VAT for each of the taxable quarters of CY 2009, the details of which are as follows: CTA CASE NO. TAXABLE PERIOD DATE FILED (2009) 8305 1st Quarter June 30, 2011 18 8322 2nd Quarter August 18, 2011 19 8348 3rd Quarter October 6, 2011 20 8408 4th Quarter January 3, 2012 21 On August 26, 2011, within the extension period granted by the Court, 22 respondent filed her Answer in CTA Case No. 8305, 23 interposing the following Special and Affirmative Defenses: " SPECIAL AND AFFIRMATIVE DEFENSES 3. She reiterates and re-pleads the preceding paragraphs of this Answer as part of her Special and Affirmative Defenses. 4. Petitioner's claim for the issuance of tax refund/tax credit certificate is subject to administrative investigation/examination by respondent's Bureau. 5. Taxes paid and collected are presumed to have been paid in accordance with law and regulations, hence, not refundable. 6. Moreover, in order to validly claim for tax credit/refund, it is imperative for petitioner to prove its 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 tax 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 the such claim. d. That the input taxes of P4,085,030.49 allegedly representing unutilized input VAT from its purchases of goods and services from VAT registered suppliers 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/refund allegedly representing unutilized input VAT in the amount of P4,085,030.49 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. 7. 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 refund. DETACa 8. A tax credit or refund, like tax exemption, is strictly construed against the taxpayer. The taxpayer claiming the tax credit or refund has the burden of proving that he is entitled to the refund or credit, in this case VAT input tax, by submitting evidence that he has complied with the requirements laid down in the tax code and the BIR's revenue regulations under which such privilege of credit or refund is accorded (Microsoft Philippines, Inc. vs. Commissioner of Internal Revenue, G R. No. 180173, April 6, 2011). " Likewise, within the extension period granted by the Court, 24 respondent filed her Answers 25 in CTA Case Nos. 8322 and 8348, on October 20, 2011 and on November 28, 2011, respectively, interposing substantially the same Special and Affirmative Defenses as those alleged in the Answer in CTA Case No. 8305, except for the amounts involved therein ( i.e. , P5,736,852.20 and P8,033,790.00) and periods ( i.e. , April 1, 2009 to June 30, 2009 and July 1, 2009 to September 30, 2009) of the claim. Respondent also contends, in both cases, that petitioner's citation in Paragraph 15 of the law is misleading and confusing considering that the laws on VAT had been amended. Respondent alleges that under Republic Act (RA) No. 9337, there are only two kinds of VAT-registered taxpayers who may apply for the issuance of a tax credit certificate or refund of input taxes, namely: (1) those with zero-rated and effectively zero-rated sales; and (2) those who would be cancelling their VAT registration. Thus, input taxes derived from importation or local purchases of capital goods to the extent that such input taxes have not been applied against output taxes are no longer entitled to this remedy except only when the VAT taxpayer would already be canceling its VAT registration. As regards respondent's Answer in CTA Case No. 8408 filed on March 26, 2012, 26 also within the extension period granted by the Court, 27 respondent interposes the following special and affirmative defenses: " SPECIAL AND AFFIRMATIVE DEFENSES 4. She reiterates and re-pleads the foregoing paragraphs of this Answer as part of her Special and Affirmative Defenses; 5. Petitioner's claim for issuance of tax credit certificate is subject to administrative investigation/examination by Respondent's Bureau; 6. Taxes paid and collected are presumed to have been paid in accordance with law and regulations, hence, not refundable; 7. It is incumbent upon the taxpayer to prove its compliance with the pertinent provisions of the NIRC, particularly Sections 112, 113, and 114 to validly claim for tax a credit/refund; 8. Taxpayer must establish by sufficient and competent evidence that it is entitled to a tax credit/refund; HEITAD 9. Claims for refund are strictly construed against the taxpayer as the same partakes the nature of a tax exemption; 10. The Petitioner should prove its legal basis for claiming the amount to be refunded." Thereafter, the four (4) cases were set for Pre-Trial Conference as follows: for CTA Case No. 8305, on September 23, 2011; 28 for CTA Case No. 8322, on November 17, 2011; 29 for CTA Case No. 8348, on January 13, 2012; 30 and for CTA Case No. 8408, on April 26, 2012. 31 Petitioner filed a Reply in each of the four cases to refute respondent's arguments contained in her Answers. In CTA Case No. 8305, petitioner filed "Reply (Re: Answer dated 26 August 2011)" on September 9, 2011; 32 in CTA Case No. 8322, it filed a Reply (Re: Answer dated 19 October 2011) through registered mail on November 8, 2011, 33 which was received by the Court on November 15, 2011; in CTA Case No. 8348, petitioner filed its Reply (Re: Answer dated 28 November 2011) on December 8, 2011; 34 and in CTA Case No. 8408, petitioner filed its Reply (Re: Answer dated 23 March 2012) on April 10, 2012. 35 On October 27, 2011, a Joint Stipulation of Facts and Issue was filed in CTA Case No. 8305. 36 In the Resolution dated November 3, 2011, the Court ordered the parties to file a Supplemental Joint Stipulation of Facts and Issues, as they failed to indicate the list of documents to be presented. Hence, on November 18, 2011, the parties submitted their Supplemental Joint Stipulation of Facts and Issue. 37 These were approved by the Court in the Resolution dated November 23, 2011, 38 which also terminated the Pre-Trial. Thereafter, the Pre-Trial Order was issued on January 16, 2012 39 in CTA Case No. 8305. Meanwhile, the Joint Stipulation of Facts and Issue in CTA Case Nos. 8322 and 8348, were submitted on December 7, 2011 40 and July 20, 2012, 41 respectively. These were approved by the Court through the Pre-Trial Order issued on January 3, 2012 42 and the Resolution dated July 26, 2012, 43 which also terminated the Pre-Trial. Petitioner filed a Motion for Consolidation on January 9, 2012, 44 seeking the consolidation of CTA Case No. 8322 with CTA Case No. 8305. This was granted by the Third Division of the Court in the Resolution dated February 8, 2012. 45 The First Division of the Court affirmed the consolidation of CTA Case No. 8322 with CTA Case No. 8305 in the Resolution dated April 2, 2012. 46 In both CTA Case Nos. 8305 and 8348 petitioner separately filed an Omnibus Motion A. For Leave of Court for Early Resolution of the Issue Whether Petitioner's Claim for Refund of Excess and Unutilized Input Taxes as Deemed Granted if Respondent Fails to Act within the 120-day Period under Section 112 of the 1997 NIRC; B. To Allow Petitioner to File its Formal Offer of Evidence Relative to this Issue; C. Postponement of Petitioner's Presentation of Evidence until Resolution of this Motion, on January 24, 2012 47 and on February 14, 2012. 48 These were denied by the Court for lack of merit in the Resolutions dated March 29, 2012 49 and April 3, 2012. 50 Thereafter, petitioner filed Motions for Reconsiderations on April 19, 2012 51 and on April 20, 2012, 52 respectively. The Court, however, denied petitioner's Motions for Reconsideration in the Resolutions dated June 18, 2012 53 and June 6, 2012. 54 Meanwhile, on April 25, 2012, petitioner filed an Omnibus Motion 55 A. For Leave of Court for Early Resolution of the Issue Whether Petitioner's Claim for Refund of Excess and Unutilized Input Taxes as Deemed Granted if Respondent Fails to Act within the 120-day Period under Section 112 of the 1997 NIRC; B. Postponement of Pre-Trial Conference on 26 April 2012 and Suspension of Proceedings until Resolution of this Motion. This was denied by the Court for lack of merit in the Resolution 56 dated June 26, 2012. Thereafter, on July 12, 2012, petitioner filed a Motion for Reconsideration (Re: Resolution of 26 June 2012), 57 which was also denied in the Resolution 58 dated November 22, 2012. On July 4, 2012, pursuant to the consolidation of CTA Case Nos. 8305 and 8322, the parties filed a Consolidated Joint Stipulation of Facts and Issue. 59 Thereafter, petitioner filed an Urgent Motion for Consolidation on July 19, 2012, 60 seeking to consolidate CTA Case No. 8348 with CTA Case No. 8305. This was granted by the Court in the Resolution dated August 15, 2012, 61 which consolidated CTA Case No. 8348 with CTA Case Nos. 8305 and 8322. Consequently, the Court ordered the parties to file a Consolidated Joint Stipulation of Facts and Issues. 62 The parties complied with the order by submitting their Amended Consolidated Joint Stipulation of Facts and Issue on August 30, 2012. 63 This was approved by the Court in the Resolution dated September 18, 2012. 64 Thereafter, a Consolidated Pre-Trial Order was issued on February 21, 2013. 65 On January 18, 2013, petitioner filed a Motion for Consolidation in CTA Case No. 8408, 66 seeking to consolidate CTA Case No. 8408 with CTA Case Nos. 8305, 8322 and 8348. This was granted by the Third Division of the Court in the Resolution dated February 20, 2013, 67 which consolidated CTA Case No. 8408 with CTA Case Nos. 8305, 8322, and 8408. This was affirmed by the First Division of the Court in the Resolution dated March 22, 2013. 68 The parties again filed an Amended Consolidated Joint Stipulation of Facts and Issue on April 18, 2013. 69 This was approved by the Court in the Resolution 70 dated April 24, 2013. Thereafter, the Court issued an Amended Consolidated Pre-Trial Order on April 25, 2013. 71 On May 10, 2013, upon Motion 72 of petitioner, the Court commissioned Katherine O. Constantino as an Independent Certified Public Accountant (CPA) for the instant consolidated cases. 73 ATICcS During trial, petitioner presented the following witnesses: (1) Agnes N. Neria its Accounting Specialist; (2) Lourdes Rosario V. Mantaring its Vice President and General Manager; (3) Amelia Villamor its Vice President for Operations; and (4) Katherine O. Constantino the Independent CPA. On April 10, 2014, petitioner filed its Formal Offer of Evidence. 74 In the Resolution dated September 25, 2014, 75 the Court admitted as petitioner's evidence, Exhibits "A" to "M-2", "N" to "U-1", "W" to "Y-3", "AA" to "BB-1", "DD", "FF" to "KK-2", "LL", "LL-1", "LL-2", "LL-3" to "SS", "SS-1", "SS-2" "SS-3", "TT-1", "TT-2", "UU" to "XX-2", "XX-4" to "YY-3", "ZZ" to "ZZ-4", "BBB" to "EEE", "EEE-2" to "JJJ", "NNN" to "PPP-597", "PPPa" to "PPP-233a", "PPP-235-a" to "PPP-243a", "PPP-245a" to "PPP-261a", "QQQ" to "VVV-300", "VVV-109A", "VVV-271A", "VVV-272A", "WWW" to "EEEE", "F 4 ", "F 4 -1", "IIIII", "IIIII-1", "K 5 ", and "K 5 -1". However, the Court denied the admission of Exhibits "V" and "CC", for failure of petitioner to have the said exhibits identified; Exhibits "Z" to "Z-5", "EE", "KKK" to "MMM", "G 5 ", "H 5 " and "JJJJJ", for failure of petitioner to submit the originals for comparison; and Exhibits "PPP-234a" and "PPP-244a", for not being found in the records of the case. On October 17, 2014, petitioner filed a Motion for Partial Reconsideration (Re: Resolution dated 25 September 2014; with Prayer for Reopening of Trial), 76 praying that the Court would grant its request to reopen the case and recall its witnesses Katherine O. Constantino and Agnes N. Neria to testify regarding the excluded exhibits and after due hearing allow petitioner to submit a supplemental formal offer of documentary exhibits. This was granted by the Court in the Resolution dated December 18, 2014. 77 Consequently, petitioner's witnesses Katherine O. Constantino and Agnes N. Neria were recalled to testify on February 10, 2015. 78 Thereafter, petitioner filed its Supplemental Formal Offer of Exhibits on February 20, 2015. 79 In the Resolution dated April 7, 2015, 80 the Court admitted petitioner's Exhibits "L 5 ", "L 5 -1", "M 5 ", "M 5 -1", "V", "CC", "Z", "Z-1", "Z-2", "Z-3", "Z-4", "Z-5", "EE", "KKK", "LLL", "LLL-1", "LLL-2", "LLL-3", "MMM", "G 5 ", "H 5 ", "JJJJJ", "PPP-234a", "PPP-244", and "PPP-244a". During the February 10, 2015 hearing, respondent's counsel manifested that she will not be presenting evidence for respondent. In view therefore, both parties were given thirty (30) days from receipt of the Court's Resolution of petitioner's Supplemental Formal Offer of Evidence to file their Memoranda. 81 Within the extended time granted by the Court, 82 the Memorandum for the Petitioner was filed on May 29, 2015; 83 while respondent's Memorandum was filed on June 15, 2015. 84 Hence, the instant consolidated cases were submitted for decision in the Resolution dated July 1, 2015. 85 Hence, this Decision. THE ISSUE The sole issue 86 for the Court's resolution, as stipulated by the parties, is: "Whether or not petitioner is entitled to its claim for refund or issuance of a tax credit certificate for its unutilized/excess input VAT payments for the 1st to 4th Quarters of 2009 amounting to, as follows: Taxable Period Amount (Php) 1st Quarter of 2009 4,085,030.49 2nd Quarter of 2009 5,736,852.20 3rd Quarter of 2009 8,033,790.00 4th Quarter of 2009 4,346,213.61 Total 22,201,886.21" ============ Petitioner's arguments: Petitioner argues that it is entitled to a refund or issuance of tax credit certificate for its excess or unutilized input VAT for the first to fourth quarters of CY 2009. It primarily contends that having fully complied with the two-year prescriptive period under Section 112 (A) of the Tax Code, and the 120-day and 30-day periods under Section 112 (C) of the same Code, this Court acquires jurisdiction over these cases. Moreover, petitioner asserts that its sales for CY 2009 were zero-rated as it rendered services to four (4) foreign companies, all engaged in business outside the Philippines; and its services were paid for in US Dollars inwardly remitted to the Philippines and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP). It also avers that it generated minimal output VAT. Furthermore, petitioner alleges that its input VAT for the first to fourth quarters of CY 2009 results from its domestic purchases of goods and services. It claims that its input VAT for CY 2009 is directly attributable to its alleged zero-rated sales for the said quarters. Petitioner also contends that its input VAT for the same quarters remains unutilized. Lastly, petitioner argues that it has complied with the submission of complete documents in support of its administrative claim for refund. Respondent's counter-arguments: Respondent counter-argues that petitioner's judicial claim for refund is not valid due to its failure to prove the submission of complete documents in support of its administrative claim for refund; and that petitioner's judicial claim for refund was prematurely filed. TIADCc Furthermore, respondent maintains that petitioner failed to observe the strict substantiation requirements for VAT-registered entities. Respondent also stresses that basic is the rule that a tax credit or refund, like tax exemption, is strictly construed against the taxpayer. The taxpayer claiming the tax credit or refund has the burden of proving that he is entitled to the refund or credit, in this case input VAT, by submitting evidence that he has complied with the requirements laid down in the Tax Code and the BIR's revenue regulations under which such privilege of credit or refund is accorded. THE COURT'S RULING The consolidated Petitions for Review are partly meritorious. Petitioner's refund claim finds legal basis on Section 112 (A) and (C) of the National Internal Revenue Code (NIRC) of 1997, as amended by RA No. 9337, which provide as follows: "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: . . . . xxx xxx xxx (C) Period within which Refund or Tax Credit of Input Taxes shall be Made. In proper cases, the Commissioner shall grant a refund or issue the tax credit certificate for creditable input taxes within one hundred twenty (120) days from the date of submission of complete documents in support of the application filed in accordance with Subsection (A) hereof. In case of full or partial denial of the claim for tax refund or tax credit, or the failure on the part of the Commissioner to act on the application within the period prescribed above, the taxpayer affected may, within thirty (30) days from the receipt of the decision denying the claim or after the expiration of the one hundred twenty day-period, appeal the decision or the unacted claim with the Court of Tax Appeals." In the application of the foregoing legal provisions, certain requisites have been jurisprudentially developed which a taxpayer-applicant must comply with to successfully obtain a credit/refund of excess input VAT. The said requisites may be classified under several categories, to wit: Timeliness of the filing of the administrative and judicial claims: 1. the claim is filed with the BIR within two years after the close of the taxable quarter when the sales were made; 87 2. that in case of full or partial denial of the refund claim, or the failure on the part of the Commissioner to act on the said claim within a period of 120 days, the judicial claim has been filed with this Court, within 30 days from receipt of the decision or after the expiration of the said 120-day period; 88 Taxpayer's registration with the BIR: 3. the taxpayer is VAT-registered; 89 Taxpayer's OUTPUT VAT: 4. the taxpayer is engaged in zero-rated or effectively zero-rated sales; 90 5. for zero-rated sales under Section 106(A)(2)(a)(1), (2) and (b), and 108(B)(1) and (2), the acceptable foreign currency exchange proceeds have been duly accounted for in accordance with BSP rules and regulations; 91 Taxpayer's INPUT VAT subject of refund claim: 6. the input taxes are due or paid; 92 7. the input taxes are not transitional input taxes; 93 8. the input taxes claimed are attributable to zero-rated or effectively zero-rated sales; 94 9. where there are both zero-rated or effectively zero-rated sales and taxable or exempt sales, and the input taxes cannot be directly and entirely attributable to any of these sales, the input taxes shall be proportionately allocated on the basis of sales volume; 95 and 10. the input taxes have not been applied against output taxes during and in the succeeding quarters. 96 The first and second requisites: The first and second requisites pertain to the timeliness of the filing of petitioner's administrative and judicial claims for issuance of tax credit certificate or refund of its input VAT. Petitioner's claims cover the four quarters of CY 2009, which respectively closed on March 31, 2009, on June 30, 2009, on September 30, 2009, and on December 31, 2009. AIDSTE Counting two years from said dates, petitioner had until March 31, 2011, June 30, 2011, September 30, 2011, and December 31, 2011, respectively, within which to file its administrative claims for issuance of TCC or refund before the BIR. As shown below, petitioner's administrative claims were timely filed on February 1, 2011, on March 28, 2011, on May 13, 2011, and on August 12, 2011, thus complying with the first requisite as shown below, to wit: CTA CY 2009 Close of Last Day to File Filing Date of Case Taxable Administrative Administrative Reference No. Quarter Claim Claim 8305 1st March 31, March 31, 2011 February 1, Exhibit "C" Quarter 2009 2011 8322 2nd June 30, June 30, 2011 March 28, 2011 Exhibits "II" & Quarter 2009 "RR" 8348 3rd September September 30, May 13, 2011 Exhibit "JJ" Quarter 30, 2009 2011 8408 4th December December 31, August 12, 2011 Exhibit "KKK" Quarter 31, 2009 2011 Anent the second requisite, respondent contends that since petitioner failed to prove that it submitted complete documents in support of its claims for refund, the counting of the 120-day period within which the BIR Commissioner shall grant a refund did not start to run. As such, the running of the 30-day period within which petitioner may appeal its claim with this Court has allegedly yet to commence. Therefore, the Petitions for Review were allegedly filed prematurely and should be dismissed accordingly. 97 The Court disagrees with respondent. In the case of Pilipinas Total Gas, Inc. vs. Commissioner of Internal Revenue , 98 the Supreme Court held that it is the taxpayer and not the BIR who would determine what relevant supporting documents to submit as basis of its claim. Likewise, the question of "when should the submission of documents be deemed 'completed' for purposes of determining the running of the 120-day period" had already been clarified therein, to wit: ". . . for purposes of determining when the supporting documents have been completed it is the taxpayer who ultimately determines when complete documents have been submitted for the purpose of commencing and continuing the running of the 120-day period. After all, he may have already completed the necessary documents the moment he filed his administrative claim, in which case, the 120-day period is reckoned from the date of filing. . . . Then, except in those instances where the BIR would require additional documents to fully appreciate a claim for tax credit or refund, in terms what additional document must be presented in support of a claim for tax credit or refund it is the taxpayer who has that right and the burden of providing any and all documents that would support his claim for tax credit or refund. After all, in a claim for tax credit or refund, it is the taxpayer who has the burden to prove his cause of action. As such, he enjoys relative freedom to submit such evidence to prove his claim. The foregoing conclusion is but a logical consequence of the due process guarantee under the Constitution. Corollary to the guarantee that one be afforded the opportunity to be heard, it goes without saying that the applicant should be allowed reasonable freedom as to when and how to present his claim within the allowable period. Thereafter, whether these documents are actually complete as required by law is for the CIR and the courts to determine. Besides, as between a taxpayer-applicant, who seeks the refund of his creditable input tax and the CIR, it cannot be denied that the former has greater interest in ensuring that the complete set of documentary evidence is provided for proper evaluation of the State. xxx xxx xxx To summarize, for the just disposition of the subject controversy, the rule is that from the date an administrative claim for excess unutilized VAT is filed, a taxpayer has thirty (30) days within which to submit the documentary requirements sufficient to support his claim, unless given further extension by the CIR. Then, upon filing by the taxpayer of his complete documents to support his application , or expiration of the period given, the CIR has 120 days within which to decide the claim for tax credit or refund. Should the taxpayer, on the date of his filing, manifest that he no longer wishes to submit any other addition documents to complete his administrative claim, the 120-day period allowed to the CIR begins to run from the date of filing. In all cases, whatever documents a taxpayer intends to file to support his claim must be completed within the two-year period under Section 112(A) of the NIRC. The 30-day period from denial of the claim or from the expiration of the 120-day period within which to appeal the denial or inaction of the CIR to the CTA must also be respected." (Emphasis supplied) Records show that petitioner, upon the filing of its administrative claims, 99 simultaneously submitted the documents in support thereof. In all its letter-requests for refund/issuance of tax credit certificate filed with the BIR for the four quarters of 2009, petitioner enumerated and stated that it attached therewith the complete set of documents in support of its applications in accordance with Annex B-1 of Revenue Memorandum Order No. 53-1998. As the records do not show that a written notice was sent by the BIR informing petitioner that the submitted documents were incomplete or that petitioner must submit additional documents, the 120-day period started and continued to run from the dates when petitioner filed its administrative claims together with the supporting documents. AaCTcI Hence, petitioner's judicial claims for the four (4) quarters of CY 2009 were likewise timely filed within the required periods, as shown below, to wit: CTA CY 2009 Filing Date of End of 120 End of 30 Days Filing Date of Case Administrative Days for CIR from expiration Petition for No. Claim to decide on of 120 days Review refund claim 8305 1st Quarter February 1, 2011 June 01, 2011 July 01, 2011 June 30, 2011 100 8322 2nd Quarter March 28, 2011 July 26, 2011 August 25, 2011 August 18, 2011 101 8348 3rd Quarter May 13, 2011 September 10, October 10, 2011 October 06, 2011 102 2011 8408 4th Quarter August 12, 2011 December 10, January 09, January 03, 2012 103 2011 2012 With the timely filing of petitioner's administrative and judicial claims of its excess and unutilized input VAT paid for the four (4) quarters of CY 2009, it has complied with both the first and second requisites. The third requisite: Petitioner has complied with the third requisite that the taxpayer is VAT-registered as evidenced by its Certificate of Registration 104 issued by the BIR with Taxpayer's Identification No. 244-027-271-000, indicating that it is subject to VAT. The fourth and fifth requisites: The fourth and fifth requisites require that the taxpayer is engaged in zero-rated or effectively zero-rated sales and for zero-rated sales under Section 106 (A) (2) (a) (1) and (2), 106 (B), and 108 (B) (1) and (2) of the NIRC of 1997, as amended by RA No. 9337, the acceptable foreign currency exchange proceeds have been duly accounted for in accordance with BSP rules and regulations. In its Quarterly VAT Returns for CY 2009, petitioner reflected a total amount of P848,488,331.30 zero-rated sales/receipts, broken down as follows: EXHIBIT PERIOD COVERED ZERO-RATED (2009) SALES/RECEIPTS "D" 1st Quarter P165,418,912.30 "F" 2nd Quarter 201,108,061.66 "G" 3rd Quarter 234,150,877.61 "I" 4th Quarter 247,810,479.73 TOTAL P848,488,331.30 ============= Petitioner alleges that its sales of services to its foreign affiliates who are all engaged in business conducted outside the Philippines, and which services were paid for in United States Dollars inwardly remitted to the Philippines and accounted for in accordance with the rules and regulations of the BSP qualify for VAT zero-rating under Section 108 (B) (2) of the NIRC of 1997, as amended by RA No. 9337, which states that: "SEC. 108. Value-added Tax on Sale of Services and Use or Lease of Properties. xxx xxx xxx (B) Transactions Subject to Zero Percent (0%) Rate. The following services performed in the Philippines by VAT-registered persons shall be subject to zero percent (0%) rate: (1) Processing, manufacturing or repacking goods for other persons doing business outside the Philippines which goods are subsequently exported, where the services are paid for in acceptable foreign currency and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP); (2) Services other than those mentioned in the preceding paragraph rendered to a person engaged in business conducted outside the Philippines or to a nonresident person not engaged in business who is outside the Philippines when the services are performed, the consideration for which is paid for in acceptable foreign currency and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP)". Based on the foregoing and the case of Commissioner of Internal Revenue vs. Burmeister and Wain Scandinavian Contractor Mindanao, Inc. , 105 in order for the supply of services to be VAT zero-rated under Section 108 (B) (2) of the NIRC of 1997, as amended by RA 9337, the following requisites must be met: 1. the services by a VAT-registered person must be other than processing, manufacturing or repacking of goods; 2. the payment for such services must be in acceptable foreign currency accounted for in accordance with the BSP rules and regulations; and 3. the recipient of such services is doing business outside the Philippines. Petitioner complied with the above-stated first requisite. Petitioner is a multinational company organized and existing under the laws of Barbados and had established regional operating headquarters in the Philippines, under Securities and Exchange Commission Certificate of Registration and License No. FS200603505, to engage in general administration and planning; business planning and coordination; sourcing/procurement of raw materials and components; corporate finance advisory services; marketing control and sales promotion; training and personnel management; logistic services; research and development services; product development; technical support and maintenance; data processing and communication and business development. 106 EcTCAD Pursuant to the service agreements entered into between petitioner and its client-affiliates, petitioner shall provide its client-affiliates with administrative and business process outsourcing (BPO) services, 107 information technology, reports and support services and other services including but not limited to, business processing, data processing, data entry, data imaging and call center services. 108 These services clearly fall within the scope of "services other than processing, manufacturing or repacking of goods" contemplated by the afore-mentioned provision. Corollary to the second requisite, Sections 113 (A) (2), (B) (1), (2) (c) and (3) of the NIRC of 1997, as amended by RA No. 9337, as implemented by Sections 4.113-1 (A) (2), (B) (1) and (2) (c) of Revenue Regulations No. 16-2005, provide that a VAT taxpayer, like herein petitioner, shall, for every lease of goods or properties and for every sale, barter or exchange of services, issue a VAT official receipt which must contain the following information. The said provisions read as follows: "SEC. 113. Invoicing and Accounting Requirements for VAT-Registered Persons. (A) Invoicing Requirements. A VAT-registered person shall issue: xxx xxx xxx (2) A VAT official receipt for every lease of goods or properties, and for every sale, barter or exchange of services. (B) Information Contained in the VAT Invoice or VAT Official Receipt. The following information shall be indicated in the VAT invoice or VAT official receipt: (1) A statement that the seller is a VAT-registered person, followed by his Taxpayer's Identification Number (TIN); (2) The total amount which the purchaser pays or is obligated to pay to the seller with the indication that such amount includes the value-added tax: Provided , That: xxx xxx xxx (c) If the sale is subject to zero percent (0%) value-added tax, the term 'zero-rated sale' shall be written or printed prominently on the invoice or receipt; xxx xxx xxx (3) The date of transaction, quantity, unit cost and description of the goods or properties or nature of the service; and" (Emphasis supplied) "SECTION 4.113-1. Invoicing Requirements. (A) A VAT-registered person shall issue: xxx xxx xxx (2) A VAT official receipt for every lease of goods or properties, and for every sale, barter or exchange of services. Only VAT-registered persons are required to print their TIN followed by the word 'VAT' in their invoice or official receipts . Said documents shall be considered as a 'VAT Invoice' or VAT official receipt. All purchases covered by invoices/receipts other than VAT Invoice/VAT Official Receipt shall not give rise to any input tax. VAT invoice/official receipt shall be prepared at least in duplicate, the original to be given to the buyer and the duplicate to be retained by the seller as part of his accounting records. (B) Information contained in VAT invoice or VAT official receipt. The following information shall be indicated in VAT invoice or VAT official receipt: (1) A statement that the seller is a VAT-registered person, followed by his TIN; (2) The total amount which the purchaser pays or is obligated to pay to the seller with the indication that such amount includes the VAT; Provided, That: xxx xxx xxx (c) If the sale is subject to zero percent (0%) VAT, the term 'zero-rated sale' shall be written or printed prominently on the invoice or receipt;" (Emphasis supplied) Based on the foregoing provisions, the foreign currency remittances referred to under Section 108 (B) (2) of the NIRC of 1997, as amended, must likewise be supported by VAT zero-rated official receipts. To prove that it rendered services to its foreign affiliates and was paid in US dollars duly accounted for in accordance with the rules and regulations of the BSP for the four quarters of CY 2009, petitioner presented VAT zero-rated official receipts, 109 VAT zero-rated invoices, 110 Schedule of Zero-Rated Sales, 111 Summary/List of Bank Remittances, 112 Customer's Advices issued by Citibank, 113 and Bank Statements of Citibank dollar account, 114 which were examined by the Court-commissioned Independent CPA. In her Report dated June 7, 2013, the Independent CPA made the following findings: Client 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total Amounts in Philippine Pesos Zero-rated sales/receipts properly supported by zero-rated official receipts 115 Manulife (International) Limited P17,832,623.69 P18,933,241.44 P19,476,259.33 P19,580,406.10 P75,822,530.56 The Manufacturer's Life Insurance Company 81,118,188.15 91,947,708.20 129,852,606.76 141,219,869.30 444,138,372.41 John Hancock Life Insurance Company 64,678,680.32 76,717,399.03 69,588,719.78 73,703,520.36 284,688,319.49 Elliot and Page Limited - - 4,247,566.52 5,624,849.01 9,872,415.53 Manulife Insurance Berhad - - - 1,026,171.20 1,026,171.20 subtotal P163,629,492.16 P187,598,348.67 P223,165,152.39 P241,154,815.97 P815,547,809.19 Zero-rated sales/receipts supported by zero-rated official receipts in the name of Customer's Department 116 The Manufacturer's Life Insurance Company P1,505,886.35 P12,307,892.42 P8,413,620.86 P5,798,503.64 P28,025,903.27 John Hancock Life Insurance Company - 1,208,848.54 2,574,038.11 1,121,755.20 4,904,641.85 subtotal P1,505,886.35 P13,516,740.96 P10,987,658.97 P6,920,258.84 P32,930,545.12 Zero-rated sales/receipts without supporting documents 117 The Manufacturer's Life Insurance Company - - P36,521.74 - P36,521.74 subtotal - - P36,521.74 - P36,521.74 TOTAL P165,135,378.51 P201,115,089.63 P234,189,333.10 P248,075,074.81 P848,514,876.05 ============== ============== ============== ============== ============== Petitioner's sales which are supported by VAT zero-rated official receipts issued in the name of "Customer's Department" and sales without supporting documents in the respective amounts of P32,930,545.12 and P36,521.74 shall be disallowed for non-compliance with the invoicing requirements provided by the afore-quoted VAT law and regulations. HSAcaE Further, it was noted that petitioner's declared zero-rated receipts from John Hancock Life Insurance Company in the amount of P538,849.96 ($11,122.44) for the first quarter of 2009 although supported by VAT zero-rated Official Receipt No. 742 118 it does not have corresponding Citibank Customer Advice-Bank Credit Memo or Bank Statement; hence, the same shall also be disallowed. In sum, petitioner's declared zero-rated receipts for CY 2009 which are duly supported by VAT zero-rated official receipts and Citibank Customer Advices-Bank Credit Memos and Bank Statements for CY 2009 amounted only to P815,008,959.23, detailed as follows: Client 1st Quarter 119 2nd Quarter 120 3rd Quarter 121 4th Quarter 122 Total Amounts in Philippine Pesos Zero-rated sales/receipts properly supported by zero- rated official receipts per ICPA report Manulife (International) Limited P17,832,623.69 P18,933,241.44 P19,476,259.33 P19,580,406.10 P75,822,530.56 The Manufacturer's Life Insurance Company 81,118,188.15 91,947,708.20 129,852,606.76 141,219,869.30 444,138,372.41 John Hancock Life Insurance Company 64,678,680.32 76,717,399.03 69,588,719.78 73,703,520.36 284,688,319.49 Elliot and Page Limited - - 4,247,566.52 5,624,849.01 9,872,415.53 Manulife Insurance Berhad - - - 1,026,171.20 1,026,171.20 Total P163,629,492.16 P187,598,348.67 P223,165,152.39 P241,154,815.97 P815,547,809.19 Less: Receipts from John Hancock Life Insurance Company per OR No. 742 not supported by Citibank customer advice-bank credit memo/bank statement P538,849.96 P538,849.96 Zero-rated official receipts properly supported by zero- rated official receipts and Citibank customer advices- bank credit memos and bank statements P163,090,642.20 P187,598,348.67 P223,165,152.39 P241,154,815.97 P815,008,959.23 ============== ============== ============== ============== ============== In compliance with the third requisite of proving that its clients for the subject period of claim are non-resident foreign corporations doing business outside the Philippines, petitioner presented the following documents: EXHIBIT DOCUMENTS Manulife (International) Limited "W" Business Processing Services Agreement "AA" SEC Certification of Non-Registration of Company "FF" Certified Documents (such as Certificate of Incorporation, Memorandum of Association, First Schedule to the Companies, Certificate of Deposit of Memorandum of Association and By- Laws) "FF-1" Certificate of Registration of Change of Name of Oversea Company John Hancock Life Insurance "X" Service Agreement "Y" Addendum to the Service Agreement "BB" SEC Certification of Non-Registration of Company The Manufacturer's Life Insurance Company "Z" Master Administrative Services Agreement "DD" Amended General Information Sheet "EE" Certificate of Filing of Amended General By-laws of a Foreign Corporation "GG" Certification of Articles of Incorporation or Amendments to Articles of Incorporation "HH" Letters Patent Manulife Insurance Berhad "LLL" Service Agreement "MMM" SEC Certification of Non-Registration of Company In order to be considered as non-resident foreign corporation doing business outside the Philippines, each entity must be supported at the very least by both SEC Certificate of Non-Registration of Company and proof of incorporation or registration in a foreign country, and that there is no indication that said foreign corporation is doing business in the Philippines. A careful consideration of the evidence presented by petitioner however failed to establish that the following entities are non-resident foreign corporations doing business outside the Philippines: CLIENT GROUND FOR DISALLOWANCE The Manufacturer's Life A corporation organized and residing Insurance Company in Canada which conducts business in the Philippines through its Philippine branch office ( Exhibits "DD", "EE", and "HH" ) Elliot and Page Limited Without SEC Certificate of Non- Registration of Company and Proof of Incorporation or Registration in a Foreign Country Manulife Insurance Without Proof of Incorporation or Berhad Registration in a Foreign Country Hence, petitioner's declared zero-rated receipts from the afore-mentioned entities for CY 2009 in the total amount of P455,036,959.14, detailed below, shall be disallowed. HESIcT Client 1st Quarter 123 2nd Quarter 124 3rd Quarter 125 4th Quarter 126 Total Declared Zero-Rated Receipts in Philippine Pesos The Manufacturer's Life Insurance Company P81,118,188.15 P91,947,708.20 P129,852,606.76 P141,219,869.30 P444,138,372.41 Elliot and Page Limited - - 4,247,566.52 5,624,849.01 9,872,415.53 Manulife Insurance Berhad 1,026,171.20 1,026,171.20 Total P81,118,188.15 P91,947,708.20 P134,100,173.28 P147,870,889.51 P455,036,959.14 ============== ============== ============== ============== ============== In sum, only the amount of P359,972,000.09, representing gross receipts derived by petitioner from services rendered to the following entities, qualifies for VAT zero-rating under Section 108 (B) (2) of the NIRC of 1997, as amended: Client 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total Amounts in Philippine Pesos Zero-rated sales/receipts properly supported by zero-rated official receipts per ICPA report Manulife (International) Limited P17,832,623.69 P18,933,241.44 P19,476,259.33 P19,580,406.10 P75,822,530.56 John Hancock Life Insurance Company 64,678,680.32 76,717,399.03 69,588,719.78 73,703,520.36 284,688,319.49 Total 82,511,304.01 95,650,640.47 89,064,979.11 93,283,926.46 360,510,850.05 Less: Receipts from John Hancock Life Insurance Company per OR No. 742 not supported by Citibank Customer Advice-Bank Credit Memo 538,849.96 538,849.96 Zero-rated sales/receipts properly supported by zero-rated official receipts and Citibank Customer Advice-Bank Credit Memos P81,972,454.05 P95,650,640.47 P89,064,979.11 P93,283,926.46 P359,972,000.09 ============= ============= ============= ============= ============= A comparison of the amount of zero-rated receipts as reflected in the Summary of Zero-Rated Sales/Receipts as accounted for by the Independent CPA vis--vis the amount declared in petitioner's Quarterly VAT Returns shows the following discrepancies: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total Per Summary of Zero- Rated Sales/Receipts 127 P165,135,378.51 P201,115,089.63 P234,189,333.10 P248,075,074.81 P848,514,876.05 Per Quarterly VAT Returns 128 165,418,912.30 201,108,061.66 234,150,877.61 247,810,479.73 848,488,331.30 Difference (P283,533.79) P7,027.97 P38,455.49 P264,595.08 P26,544.75 ============= ============= ============= ============= ============= For the first quarter of 2009, petitioner failed to provide supporting documents for its declared zero-rated receipts in the amount of P283,533.79, whereas for the second, third and fourth quarters of 2009, petitioner failed to declare its zero-rated receipts in the respective amounts of P7,027.97, P38,455.49, and P264,595.08. TAIaHE Accordingly, for purposes of input VAT allocation, the basis of petitioner's total amount of zero-rated receipts per quarter is the higher between the amount per Summary of Zero-Rated Sales/Receipts and per Quarterly VAT Returns, to wit: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total Zero-Rated Receipts P165,418,912.30 P201,115,089.63 P234,189,333.10 P248,075,074.81 P848,798,409.84 Consequently, only the portion of the input VAT claim attributable to the substantiated zero-receipts will be considered for refund using the following rate: CY 2009 Valid Zero-Rated Should-be Total Rate of Valid Zero- Receipts Amount of Rated Receipts to Declared Zero- Should-Be Total Rated Receipts 129 Amount of Declared Zero-Rated Receipts 1st Quarter P81,972,454.05 P165,418,912.30 49.554463% 2nd Quarter 95,650,640.47 201,115,089.63 47.560151% 3rd Quarter 89,064,979.11 234,189,333.10 38.031185% 4th Quarter 93,283,926.46 248,075,074.81 37.603103% Total P359,972,000.09 P848,798,409.84 ============= ============= The sixth, seventh, eighth, ninth, and tenth requisites: Having found that petitioner had VAT zero-rated receipts for the subject period of claim, the Court shall proceed to determine whether petitioner complied with the following remaining requisites: a) sixth requisite: the input taxes are due or paid; b) seventh requisite: the input taxes are not transitional input taxes; c) eighth requisite: the input taxes claimed are attributable to zero-rated or effectively zero-rated sales; d) ninth requisite: where there are both zero-rated or effectively zero-rated sales and taxable or exempt sales, and the input taxes cannot be directly and entirely attributed to any of these sales, the input taxes shall be proportionately allocated on the basis of sales volume; and e) tenth requisite: the input taxes have not been applied against output taxes during and in the succeeding quarters. In its Quarterly VAT Returns for CY 2009, petitioner reflected a total amount of P22,109,898.38 excess input VAT arising from its amortization of input VAT on purchases of capital goods exceeding P1Million, domestic purchases of goods not exceeding P1Million, domestic purchases of goods other than capital goods, and domestic purchases of services for the said period, broken down as follows: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter CY 2009 Exhibit "D" Exhibit "F" Exhibit "G" Exhibit "I" Amounts in Philippine Pesos Input Tax Deferred on Capital Goods Exceeding P1 Million from Previous Quarter P20,942,297.70 P20,208,563.33 P19,116,089.82 P21,254,644.84 P20,942,297.70 Add: Input Tax on Capital Goods Exceeding P1 Million Purchased this Quarter 699,756.44 383,671.86 3,761,992.45 3,557,539.16 8,402,959.91 Total Unamortized Input Tax on Capital Goods Exceeding P1 Million P21,642,054.14 P20,592,235.19 P22,878,082.27 24,812,184.00 29,345,257.60 Less: Input Tax on Purchases of Capital Goods exceeding P1 Million Deferred for the succeeding period 20,208,563.33 19,116,089.82 21,254,644.84 22,991,003.97 22,991,003.96 Amortization of Input Tax on Capital Goods exceeding P1 Million P1,433,490.81 P1,476,145.37 P1,623,437.43 P1,821,180.03 P6,354,253.64 Add: Input Tax on Domestic Purchases of Capital Goods not Exceeding P1 Million 370,752.22 319,569.64 606,290.67 633,629.38 1,930,241.91 Domestic Purchases of Goods Other than Capital Goods 224,173.93 72,196.78 97,184.00 177,032.24 570,586.95 Domestic Purchase of Services 3,024,164.85 3,868,940.41 6,717,378.26 1,718,405.91 15,328,889.43 Total Allowable Input Tax P5,052,581.81 P5,736,852.20 P9,044,290.36 P4,350,247.56 P24,183,971.93 Less: Output Tax Due 967,551.32 - 1,010,500.36 96,021.87 2,074,073.55 Excess Input Tax P4,085,030.49 P5,736,852.20 P8,033,790.00 P4,254,225.69 P22,109,898.38 ============= ============= ============= ============= ============= As can be seen in the returns, the above input taxes do not include transitional input taxes, which are equivalent to two percent (2%) of the value of the beginning inventory on hand or actual VAT on such goods, materials and supplies, whichever is higher, which amount shall be creditable against the output tax of VAT-registered person. 130 In support of its input VAT claim, petitioner submitted various suppliers' invoices and official receipts 131 that were examined by the Independent CPA. As can be gleaned from the immediately preceding table, part of the amount of the claim is P17,829,718.29, computed as follows: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total Purchase of Capital Goods not exceeding P1M P370,752.22 P319,569.64 P606,290.67 P633,629.38 P1,930,241.91 Domestic Purchases of Goods other than Capital Goods 224,173.93 72,196.78 97,184.00 177,032.24 570,586.95 Domestic Purchases of Services 3,024,164.85 3,868,940.41 6,717,378.26 1,718,405.91 15,328,889.43 Total P3,619,091.00 P4,260,706.83 P7,420,852.93 P2,529,067.53 P17,829,718.29 ============ ============ ============ ============ ============ However, a review of the Independent CPA Report together with the documents supporting the said amount of P17,829,718.29 shows that input taxes amounting to P1,206,671.45 should be disallowed for not being properly substantiated by VAT invoices or official receipts as prescribed under Sections 110 (A), 113 (A) and (B), 237, and 238 of the NIRC of 1997, as amended by RA No. 9337, in relation to Sections 4.110-1, 4.110-8, and 4.113-1 of Revenue Regulations No. 16-2005, as amended. Below is the breakdown of the said amount of P1,206,671.45, to wit: FINDINGS 1st Quarter 2nd 3rd 4th Quarter Total Quarter Quarter Amounts in Philippine Pesos INPUT VAT ON PURCHASES OF CAPITAL GOODS NOT EXCEEDING P1MILLION 1. Supported by TIN VAT invoices dated outside the period of claim 132 P245,727.99 - - P8,568.00 P254,295.99 2. Supported by TIN VAT invoice with petitioner's TIN handwritten on a printed invoice 133 - - - 605.57 605.57 3. Supported by VAT REG TIN invoice with incomplete petitioner's address 134 - - - 1,071.32 1,071.32 4. Supported by collection receipts with indication of "not valid as source of input tax" 135 - - 25,935.85 - 25,935.85 5. No supporting documents 136 - 22,554.49 111,618.94 41,990.56 176,163.99 Total P245,727.99 P22,554.49 P137,554.79 P52,235.45 P458,072.72 INPUT VAT ON DOMESTIC PURCHASES OF GOODS (OTHER THAN CAPITAL GOODS) 1. Supported by TIN VAT invoices dated outside the period of claim 137 P16,473.86 - - - P16,473.86 2. Supported by VAT REG TIN invoices but without invoice date 138 - - - P360.54 360.54 3. Supported by VAT REG TIN invoices with alteration in the petitioner's name 139 - - - 237.64 237.64 4. Supported by VAT REG TIN invoices with name of the petitioner handwritten on a printed invoice (Annex 56) - - - 540.00 540.00 5. Supported by TIN VAT invoices without petitioner's TIN 140 215.92 - - - 215.92 6. Supported by TIN VAT invoices with incorrect petitioner's TIN 141 - 401.46 - - 401.46 7. Supported by TIN VAT invoices with alteration on the input VAT amount 142 - 135.86 - - 135.86 8. Supported by Statement of Accounts 143 - 807.04 28.80 1,121.25 1,957.09 9. No supporting documents 144 (627.83) 5,921.49 - 62,679.99 67,973.65 Total P16,061.95 P7,265.85 P28.80 P64,939.42 P88,296.02 INPUT VAT ON DOMESTIC PURCHASES OF SERVICES 1. Supported by official receipts dated outside the period of claim a. VAT REG TIN official receipts 145 - - - P37,050.26 P37,050.26 b. TIN VAT official receipts 146 - - - 13,039.93 13,039.93 2. Supported by VAT REG TIN official receipts but without petitioner's TIN indicated therein 147 - 3,535.71 - - 3,535.71 3. Supported by VAT REG TIN official receipts with incorrect petitioner's TIN indicated therein 148 - - 16,208.64 - 16,208.64 4. Supported by VAT REG TIN official receipts with alteration in the petitioner's TIN 149 11,522.40 - - - 11,522.40 5. Supported by official receipts but the amount of VAT is not shown separately in the official receipt: a. VAT REG TIN official receipts 150 - - 8,035.71 9,672.00 17,707.71 b. TIN VAT official receipt 151 41,089.69 37,903.01 123,842.65 - 202,835.35 6. Supported by tape receipts 152 - 924.19 - - 924.19 Supported by provisional receipts 153 53,000.57 - 9,400.18 - 62,400.75 7. Supported by official receipts with VAT Exempt Sale indicated in the official receipt: a. VAT REG TIN official receipts 154 - - 19.44 - 19.44 b. TIN VAT official receipts 155 80,717.82 - 40,876.86 - 121,594.68 8. Supported by collection receipts with indication of "not valid as source of input tax" 156 - - 12,589.29 52,223.49 64,812.78 9. Supported by VAT REG TIN official receipts with the word "Zero- rated" 157 - - - 3,600.00 3,600.00 10. Supported by Statement of Accounts 158 - 906.54 - - 906.54 11. Supported by NON VAT REG TIN official receipt 159 - - - 34,200.00 34,200.00 12. No supporting documents 160 (7,191.39) 8,413.44 (8,262.35) 76,984.63 69,944.33 Total P179,139.09 P51,682.89 P202,710.42 P226,770.31 P660,302.71 GRAND TOTAL P440,929.03 P81,503.23 P340,294.01 P343,945.18 P1,206,671.45 ============ ============ =========== =========== =========== In addition to the foregoing exceptions found by the Independent CPA, the following input VAT totaling P135,880.05 shall also be disallowed for non-compliance with the substantiation requirements under the VAT law and regulations: Exhibit Vendor's Name Invoice/ Date Amount O.R. No. Input VAT on domestic purchase of service supported by documents other than VAT Official Receipt 2nd Quarter VVV-81 STANDARD INSURANCE CO., INC. 26888 5/13/2009 P2,314.80 3rd Quarter VVV-205 UP NORTH PROPERTY HOLDINGS, INC. 1000000840 10/7/2009 43,640.82 subtotal P45,955.62 Input VAT on domestic purchases of services supported by VAT Official Receipts but the amount of VAT is not separately indicated 2nd Quarter VVV-120 UPS DELBROS INTERNATIONAL EXPRESS LTD., 89927 5/5/2009 P3,522.51 INC. 3rd Quarter VVV-144 ANSCOR-CASTO TRAVEL CORPORATION 36981 8/27/2009 72.00 4th Quarter VVV-223 GUTHRIE JENSEN CONSULTANTS, INC. 33868 11/25/2009 1,200.00 subtotal P4,794.51 Input VAT on domestic purchases of services supported by VAT Official Receipts where the amount reflected therein is lower than the amount of claim 2nd Quarter VVV-83 EAGLEWATCH SECURITY SERVICES 12634 6/10/2009 Per Official Per Claim Receipt Difference P1,238.69 P814.84 P423.85 P423.85 3rd Quarter VVV-191 ABS-CBN BROADCASTING CORPORATION 193573 7/31/2009 Input VAT Input VAT Per Claim Per OR Difference P277,029.07 P193,028.40 P84,000.67 84,000.67 subtotal P84,424.52 Input VAT on domestic purchase of goods (other than capital goods) supported by VAT Invoice where the amount reflected therein is lower than the amount of claim 1st Quarter UUU-39 SAN-MOR TRADING, INC. 29885 2/3/2009 Input VAT Input VAT Per Claim Per Invoice Difference P3,843.23 P3,169.97 P673.26 P673.26 subtotal P673.26 Input VAT on purchase of capital goods not exceeding P1Million supported by VAT Invoice where the amount reflected therein is lower than the amount of claim 4th Quarter WWW-91 88 LIVING CORPORATION 333 12/20/2009 Input VAT Input VAT Per Claim Per Invoice Difference P1,562.14 P1,530.00 P32.14 P32.14 subtotal P32.14 Total P135,880.05 =========== Hence, out of the P17,829,718.29 input VAT claim on purchases of capital goods not exceeding P1million, domestic purchases of goods other than capital goods and domestic purchases of services, only the amount of P16,487,166.79 represents petitioner's valid input VAT, computed as follows: 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Total Amounts in Philippine Pesos Input VAT per VAT Returns Purchases of Capital Goods not exceeding P1 Million P370,752.22 P319,569.64 P606,290.67 P633,629.38 P1,930,241.91 Domestic Purchases of Goods other than Capital Goods 224,173.93 72,196.78 97,184.00 177,032.24 570,586.95 Domestic Purchases of Services 3,024,164.85 3,868,940.41 6,717,378.26 1,718,405.91 15,328,889.43 Total P3,619,091.00 P4,260,706.83 P7,420,852.93 P2,529,067.53 P17,829,718.29 Less: Disallowances Per ICPA report P440,929.03 P81,503.23 P340,294.01 P343,945.18 P1,206,671.45 Per this Court's further verification 673.26 6,261.16 127,713.49 1,232.14 135,880.05 Total P441,602.29 P87,764.39 P468,007.50 P345,177.32 P1,342,551.50 Properly Substantiated Input VAT on Purchases of Capital Goods not exceeding P1Million, Domestic Purchases of Goods other than Capital Goods and Domestic Purchases of Services P3,177,488.71 P4,172,942.44 P6,952,845.43 P2,183,890.21 P16,487,166.79 ============ ============ ============ ============ ============= The Court shall now proceed to determine the substantiation of the amortization of input VAT on capital goods purchases exceeding P1Million in the amount of P6,354,253.64, which originated from the P20,942,297.70 input tax deferred on capital goods exceeding P1Million from previous quarter and P8,402,959.91 input VAT from purchases during the four quarters of CY 2009, as shown below: Input Tax Deferred on Capital Goods exceeding P1Million from Previous Quarter P20,942,297.70 Add: Input Tax on Capital Goods exceeding P1Million Purchased this Quarter 8,402,959.91 Total Unamortized Input Tax on Capital Goods exceeding P1Million 29,345,257.61 Less: Input Tax on Purchases of Capital Goods exceeding P1Million deferred for the succeeding period 22,991,003.97 Amortization of Input Tax on Capital Goods exceeding P1Million P6,354,253.64 ============ It is indicated in the Independent CPA Report that the P20,942,297.70 input tax deferred on capital goods exceeding P1Million from previous quarter pertains to petitioner's purchases in the years 2006, 2007 and 2008. 161 However, petitioner presented only a Lapsing Schedule 162 for the said periods without providing the supporting invoices and/or official receipts to establish the existence of the said input VAT. Hence, the claimed amortization of input VAT on purchases from previous quarters of taxable years 2006 to 2008 shall be denied. As regards the substantiation of the P8,402,959.91 input VAT on purchases of capital goods exceeding P1Million for taxable year 2009, the Independent CPA noted the following findings: 163 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Total Amounts in Philippine Pesos Properly Substantiated for VAT Purposes 1. Input tax claimed on purchases of capital goods exceeding P1Million which are substantiated for VAT purposes: a. Properly supported by VAT REG TIN invoice 164 - - P794,235.27 P815,787.00 P1,610,022.27 b. Properly supported by TIN VAT invoice 165 P521,074.67 P383,671.86 2,709,337.63 1,714,121.26 5,328,205.42 subtotal P521,074.67 P383,671.86 P3,503,572.90 P2,529,908.26 P6,938,227.69 Other Findings 2. Input tax claimed on purchases of capital goods exceeding P1Million without supporting documents P178,681.77 - P258,419.55 P1,027,630.90 P1,464,732.22 subtotal P178,681.77 - P258,419.55 P1,027,630.90 P1,464,732.22 Total P699,756.44 P383,671.86 P3,761,992.45 P3,557,539.16 P8,402,959.91 =========== =========== =========== =========== =========== From the above findings of the Independent CPA, the unsupported amount of P1,464,732.22 shall be disallowed. In addition, petitioner's input VAT claim in the amount of P465,336.43, which relates to purchases of services, must be denied for petitioner's failure to substantiate the same with VAT official receipts, to wit: cTDaEH Exhibit Supplier's Name Invoice Date Amount of Input VAT No. Purchase Third Quarter XXX-5 IBMS TECHNOLOGY PHILS. 01901 7/23/2009 P1,312,500.00 P157,500.00 CORP. Fourth Quarter XXX-15 TOTAL VENTURES, INC. 1316 12/2/2009 2,565,303.58 307,836.43 TOTAL P3,877,803.58 P465,336.43 =========== =========== Thus, out of the P8,402,959.91 input VAT on purchases of capital goods exceeding P1Million, only the amount of P6,472,891.26 was properly substantiated by VAT invoices/official receipts, computed as follows: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total Input VAT on Purchases of Capital Goods exceeding P1Million P699,756.44 P383,671.86 P3,761,992.45 P3,557,539.16 P8,402,959.91 Less: Disallowances Per ICPA findings 178,681.77 - 258,419.55 1,027,630.90 1,464,732.22 Per this Court's findings - - 157,500.00 307,836.43 465,336.43 Properly substantiated Input VAT on Purchases of Capital Goods exceeding P1Million P521,074.67 P383,671.86 P3,346,072.90 P2,222,071.83 P6,472,891.26 =========== =========== =========== =========== =========== Pursuant to Section 110 (A) (2) of the NIRC of 1997, as amended by RA No. 9337, input VAT claim on capital goods purchases attributable to zero-rated sales may be claimed either in full during the month of acquisition, or spread over a period of time, depending on the aggregate acquisition cost of the capital goods in the calendar month. If the aggregate acquisition cost exceeds P1Million, the claim for input tax should be spread over 60 months or the estimated useful life of the capital goods, whichever is shorter. On the other hand, if aggregate acquisition cost does not exceeds P1million, the total input taxes shall be disallowed as credit/refund in the month of acquisition. cSaATC Applying the said Section 110 (A) (2) to the present case, out of the P6,472,891.26 input VAT properly substantiated by VAT invoices, only the amount of P565,565.77 is creditable for the year 2009, computed as follows: Date of Supplier Exhibit Amount of Input Tax Est. Useful Monthly Allowable Purchase 166 No. Purchase net Life (in Amortization Input Tax (Invoice/ of VAT mos.) 167 for CY 2009 O.R.) Amounts in Philippine Pesos FIRST QUARTER Accent Micro 3/9/09 Tech., Inc. XXX P3,309,371.65 P397,124.60 48 P8,273.43 P82,734.30 Jebsen & Jessen 3/9/09 Communications XXX-1 1,032,917.25 123,950.07 60 2,065.83 20,658.30 subtotal P4,342,288.90 P521,074.67 P10,339.26 P103,392.60 SECOND QUARTER Accent Micro 05/12/09 Tech., Inc. XXX-2 3,197,265.50 383,671.86 48 7,993.16 63,945.28 subtotal P3,197,265.50 P383,671.86 P7,993.16 P63,945.28 THIRD QUARTER Barrington 8/7/09 Carpets, Inc. XXX-3A P1,692,180.00 P203,061.60 60 P3,384.36 P16,921.80 Trends & 9/23/09 Technologies XXX-4 3,613,947.27 433,673.67 60 7,227.89 28,911.56 Total Ventures, 7/29/09 Inc. XXX-6A 7,695,910.67 923,509.28 60 15,391.82 92,350.92 Total Ventures, 9/3/09 Inc. XXX-7A 7,695,910.67 923,509.28 60 15,391.82 61,567.28 Accent Micro 7/14/09 Tech., Inc. XXX-8 2,660,210.55 319,225.27 60 5,320.42 31,922.52 Accent Micro 7/14/09 Tech., Inc. XXX-9 4,525,781.66 543,093.80 48 11,314.45 67,886.70 subtotal P27,883,940.82 P3,346,072.90 P58,030.76 P299,560.78 FOURTH QUARTER Futureproof Asia, 10/6/09 Inc. XXX-10 P2,058,000.00 P246,960.00 60 P4,116.00 P12,348.00 Barrington 10/14/09 Carpets, Inc. XXX-11A 2,115,225.00 253,827.00 60 4,230.45 12,691.35 IBMS Technology 11/16/09 Phils. XXX-12A 2,625,000.00 315,000.00 60 5,250.00 10,500.00 Total Ventures, 10/14/09 Inc. XXX-13A 7,695,910.67 923,509.28 60 15,391.82 46,175.46 Hoffsman Systematic 10/14/09 Designs, Inc. XXX-14 1,139,775.00 136,773.00 60 2,279.55 6,838.65 Accent Micro 12/10/09 Tech., Inc. XXX-16 1,796,620.14 215,594.42 60 3,593.24 3,593.24 Teledatacom 10/14/09 Phils., Inc. XXX-17 1,086,734.45 130,408.13 60 2,173.47 6,520.41 subtotal P18,517,265.26 P2,222,071.83 P37,034.53 P98,667.11 TOTAL P53,940,760.48 P6,472,891.26 P113,397.71 P565,565.77 ============= ============= ============= =========== Therefore, petitioner's properly substantiated input VAT for the four quarters of taxable year 2009 amounted only to P17,052,732.56, computed as follows: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total Amounts in Philippine Pesos Input VAT on Purchases of Capital Goods not exceeding P1Million, Domestic Purchases of Goods other than Capital Goods and Domestic Purchases of Services P3,177,488.71 P4,172,942.44 P6,952,845.43 P2,183,890.21 P16,487,166.79 Amortization of Input VAT on Purchases of Capital Goods Exceeding P1Million 103,392.60 63,945.28 299,560.78 98,667.11 565,565.77 Total Valid Input VAT P3,280,881.31 P4,236,887.72 P7,252,406.21 P2,282,557.32 P17,052,732.56 ============ ============ ============ ============ ============ A portion, however, of the P17,052,732.56 substantiated input VAT shall be applied against petitioner's reported output VAT liability for the four taxable quarters of 2009 in the total amount of P2,074,073.55. 168 Consequently, only the remaining input VAT of P14,978,659.01 can be attributed to the should-be total amount of declared zero-rated receipts of P848,798,409.84 and only the input VAT of P6,357,504.39 is attributable to the valid zero-rated receipts of P359,972,000.09 as computed below: cHDAIS 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total Valid Input VAT P3,280,881.31 P4,236,887.72 P7,252,406.21 P2,282,557.32 P17,052,732.56 Less: Output VAT 967,551.32 - 1,010,500.36 96,021.87 2,074,073.55 Excess Input VAT P2,313,329.99 P4,236,887.72 P6,241,905.85 P2,186,535.45 P14,978,659.01 Multiply by Rate of Valid Zero-Rated Receipts to Should-be Total Amount of Declared Zero-Rated Receipts 49.554463% 47.560151% 38.031185% 37.603103% Excess Input VAT Attributable to Valid Zero-Rated Receipts P1,146,358.25 P2,015,070.20 P2,373,870.76 P822,205.18 P6,357,504.39 =========== =========== =========== =========== =========== Even though the claimed input VAT was carried over by petitioner in its succeeding Quarterly VAT Returns, 169 the same remained unutilized until it was deducted as "VAT Refund/TCC claimed" in its Quarterly VAT Returns for the fourth quarter of 2010 170 and the first 171 and second 172 quarters of 2011, thus, preventing the carry-over or application of the claimed input VAT in the next taxable quarters. In sum, petitioner has sufficiently proven its entitlement to the refund or issuance of TCC in the amount of P6,357,504.39, representing unutilized excess input VAT attributable to its zero-rated receipts for the four quarters of CY 2009. WHEREFORE , in light of the foregoing, the consolidated Petitions for Review are hereby PARTIALLY GRANTED . Accordingly, respondent is hereby ORDERED TO REFUND or TO ISSUE A TCC in favor of petitioner in the amount of SIX MILLION THREE HUNDRED FIFTY-SEVEN THOUSAND FIVE HUNDRED FOUR PESOS AND THIRTY-NINE CENTAVOS (P6,357,504.39) , representing its unutilized excess input VAT attributable to its zero-rated receipts for the four (4) quarters of CY 2009. SO ORDERED. (SGD.) ERLINDA P. UY Associate Justice Roman G. del Rosario, P.J., concurs. Cielito N. Mindaro-Grulla, J., is on official business. Footnotes 1. Par. 1, Stipulation of Facts, Amended Consolidated Joint Stipulation of Facts and Issue (ACJSFI), Docket Vol. III (CTA Case No. 8305), p. 1502. 2. Par. 3, Stipulation of Facts, ACJSFI, Docket Vol. III (CTA Case No. 8305), pp. 1502 to 1503. 3. Id. 4. Par. 2, Stipulation of Facts, ACJSFI, Docket Vol. III (CTA Case No. 8305), p. 1502. 5. Pars. 2 and 2.1, Petition for Review, vis--vis Par. 1, Answer, Docket Vol. I (CTA Case No. 8305), pp. 1 to 2, and 78; Pars. 2 and 2.1, Petition for Review, vis--vis Par. 1, Answer, Docket Vol. I (CTA Case No. 8322), pp. 6 to 7, and 62; Pars. 2 and 2.1, Petition for Review, vis--vis Par. 1, Answer, Docket Vol. I (CTA Case No. 8348), pp. 6 to 7, and 80; Pars. 2 and 2.1, Petition for Review, vis--vis Par. 1, Answer, Docket (CTA Case No. 8408), pp. 6 to 7, 101. 6. Exhibits "D" and "D-2". 7. Exhibits "E" and "E-2". 8. Exhibits "F" and "F-2". 9. Exhibits "G" and "G-2". 10. Exhibits "H" and "H-2". 11. Exhibits "I" and "I-2". 12. Par. 4, Stipulation of Facts, ACJSFI, Docket Vol. III (CTA Case No. 8305), p. 1503. 13. Exhibits "C" and "C-1". 14. Exhibits "II", and "II-1"; Exhibits "RR" and "RR-1". 15. Exhibits "JJ" and "JJ-1". 16. Exhibit "KKK". 17. Refer to Par. 5, Stipulation of Facts, ACJSFI, Docket Vol. III (CTA Case No. 8305), p. 1503. 18. Petition for Review, Docket Vol. I (CTA Case No. 8305), pp. 1 to 14. 19. Petition for Review, Docket Vol. I (CTA Case No. 8322), pp. 6 to 18. 20. Petition for Review, Docket Vol. I (CTA Case No. 8348), pp. 6 to 18. 21. Petition for Review, Docket (CTA Case No. 8408), pp. 6 to 19. 22. Order dated July 26, 2011, Docket Vol. I (CTA Case No. 8305), p. 77. 23. Docket Vol. I (CTA Case No. 8305), pp. 78 to 81. 24. Resolution dated September 20, 2011, Docket Vol. I (CTA Case No. 8322), p. 61; Order dated November 3, 2011, Docket Vol. I (CTA Case No. 8348), p. 65. 25. Docket Vol. I (CTA Case No. 8322), pp. 62 to 65; CTA Case No. 8348, Docket Vol. I, pp. 80 to 83. 26. Docket (CTA Case No. 8408), pp. 101 to 103. 27. Resolution dated February 29, 2012, Docket (CTA Case No. 8408), p. 100. 28. Docket Vol. I (CTA Case No. 8305), p. 82. 29. Docket Vol. I (CTA Case No. 8322), p. 66. 30. Docket Vol. I (CTA Case No. 8348), p. 84. 31. Docket (CTA Case No. 8408), p. 104. 32. Docket Vol. I (CTA Case No. 8305), pp. 83 to 94. 33. Docket Vol. II (CTA Case No. 8322), pp. 654 to 667. 34. Docket Vol. I (CTA Case No. 8348), pp. 66 to 78. 35. Docket (CTA Case No. 8408), pp. 106 to 115. 36. Docket Vol. III (CTA Case No. 8305), pp. 1148 to 1152. 37. Docket Vol. III (CTA Case No. 8305), pp. 1156 to 1165. 38. Docket Vol. III (CTA Case No. 8305), pp. 1168 to 1169. 39. Docket Vol. III (CTA Case No. 8305), pp. 1199 to 1206. 40. Docket Vol. II (CTA Case No. 8322), pp. 681 to 685. 41. Docket Vol. II (CTA Case No. 8348), 815 to 819. 42. Docket Vol. II (CTA Case No. 8322), pp. 692 to 699. 43. Docket Vol. II (CTA Case No. 8348), p. 824. 44. Docket Vol. II (CTA Case No. 8322), pp. 700 to 703. 45. Docket Vol. II (CTA Case No. 8322), pp. 948-949; Docket Vol. III (CTA Case No. 8305), pp. 1246 to 1247. 46. Docket Vol. II (CTA Case No. 8322), p. 973; Docket Vol. III (CTA Case No. 8305), p. 1295. 47. Docket Vol. III (CTA Case No. 8305), pp. 1207 to 1233. 48. Docket Vol. II (CTA Case No. 8348), pp. 673 to 688. 49. Docket Vol. III (CTA Case No. 8305), pp. 1287 to 1293. 50. Docket Vol. II (CTA Case No. 8348), pp. 716 to 727. 51. Motion for Reconsideration (Resolution of 29 March 2012), Docket Vol. III (CTA Case No. 8305), pp. 1296 to 1303. 52. Motion for Reconsideration (Resolution of 03 April 2012), Docket Vol. II (CTA Case No. 8348), pp. 728 to 738. 53. Docket Vol. III (CTA Case No. 8305), pp. 1313 to 1321. 54. Docket Vol. II (CTA Case No. 8348), pp. 747 to 750. 55. Docket (CTA Case No. 8408), pp. 120 to 144. 56. Docket (CTA Case No. 8408), pp. 188 to 190. 57. Docket (CTA Case No. 8408), pp. 192 to 199. 58. Docket (CTA Case No. 8408), pp. 207 to 212. 59. Docket Vol. III (CTA Case No. 8305), pp. 1323 to 1327. 60. Docket Vol. II (CTA Case No. 8348), pp. 761 to 764. 61. Docket Vol. II (CTA Case No. 8348), p. 835. 62. Docket Vol. III (CTA Case No. 8305), pp. 1354 to 1355. 63. Docket Vol. III (CTA Case No. 8305), pp. 1356 to 1360. 64. Docket Vol. III (CTA Case No. 8305), pp. 1369 to 1370. 65. Docket Vol. III (CTA Case No. 8305), pp. 1479 to 1491. 66. Docket (CTA Case No. 8408), pp. 215 to 218. 67. Docket (CTA Case No. 8408), pp. 229 to 230. 68. Docket Vol. III (CTA Case No. 8305), p. 1496. 69. Docket Vol. III (CTA Case No. 8305), pp. 1502 to 1506. 70. Docket Vol. IV (CTA Case No. 8305), p. 1810. 71. Docket Vol. IV (CTA Case No. 8305), pp. 1817 to 1829. 72. Motion to Commission an Independent Certified Public Accountant, Docket Vol. IV (CTA Case No. 8305), pp. 1834 to 1836. 73. Docket Vol. IV (CTA Case No. 8305), p. 1856. 74. Docket Vol. V (CTA Case No. 8305), pp. 2071 to 2098. 75. Docket Vol. V (CTA Case No. 8305), pp. 2175 to 2177. 76. Docket Vol. V (CTA Case No. 8305), pp. 2178 to 2184. 77. Docket Vol. V (CTA Case No. 8305), pp. 2192 to 2194. 78. Minutes of the Hearing dated February 10, 2015, Docket Vol. V (CTA Case No. 8305), pp. 2212 to 2215. 79. Docket Vol. V (CTA Case No. 8305), pp. 2219 to 2232. 80. Docket Vol. V (CTA Case No. 8305), pp. 2240 to 2241. 81. Resolution dated February 10, 2015, Docket Vol. V (CTA Case No. 8305), pp. 2217 to 2218. 82. Order dated May 21, 2015, Docket Vol. V (CTA Case No. 8305), p. 2249. 83. Docket Vol. V (CTA Case No. 8305), pp. 2250 to 2276. 84. Docket Vol. V (CTA Case No. 8305), pp. 2278 to 2286. 85. Docket Vol. V (CTA Case No. 8305), p. 2288. 86. Issue, ACJSFI, Docket Vol. III (CTA Case No. 8305), p. 1504. 87. Intel Technology Philippines, Inc. vs. Commissioner of Internal Revenue , G.R. No. 166732, April 27, 2007; San Roque Power Corporation vs. Commissioner of Internal Revenue , G.R. No. 180345, November 25, 2009; AT&T Communications Services Philippines, Inc. vs. Commissioner of Internal Revenue , G.R. No. 182364, August 3, 2010. 88. Rohm Apollo Semiconductor Philippines vs. Commissioner of Internal Revenue , G.R. No. 168950, January 14, 2015. 89. Intel Technology Philippines, Inc. vs. Commissioner of Internal Revenue , supra ; San Roque Power Corporation vs. Commissioner of Internal Revenue , supra ; AT&T Communications Services Philippines, Inc. vs. Commissioner of Internal Revenue , supra. 90. Id. 91. Id. 92. Id. 93. Id. 94. Id. 95. Intel Technology Philippines, Inc. vs. Commissioner of Internal Revenue , supra ; San Roque Power Corporation vs. Commissioner of Internal Revenue , supra. 96. Intel Technology Philippines, Inc. vs. Commissioner of Internal Revenue , supra ; San Roque Power Corporation vs. Commissioner of Internal Revenue , supra ; AT&T Communications Services Philippines, Inc. vs. Commissioner of Internal Revenue , supra. 97. Respondent's Memorandum, Docket Vol. V (CTA Case No. 8305), pp. 2280 and 2281. 98. G.R. No. 207112, December 8, 2015. 99. Exhibits "C", "II", "JJ", and "KKK". 100. Docket Vol. I (CTA Case No. 8305), p. 1. 101. Docket Vol. I (CTA Case No. 8322), p. 6. 102. Docket Vol. I (CTA Case No. 8348), p. 6. 103. Docket (CTA Case No. 8408), p. 6. 104. Exhibit "B". 105. G.R. No. 153205, January 22, 2007. 106. Exhibit "A". 107. Exhibit "W-2". 108. Exhibit "X-2". 109. Exhibits "PPP" to "PPP-597". 110. Exhibits "PPPa" to "PPP-261a". 111. Exhibits "O", "SS", "LL", and "QQQ". 112. Exhibits "S", "QQ", "XX", and "EEE". 113. Exhibits "S-2" to "S-72", "QQ-2" to "QQ-13", "XX-2" to "XX-18", and "EEE-2" to "EEE-20". 114. Exhibits "RRR" to "RRR-11". 115. Exhibit "OOO", Annexes 5, 6, 7, and 8. 116. Id. , Annexes 9, 10, 11, and 12. 117. Id. , Annex 13. 118. Exhibit "PPP-97". 119. Exhibit "OOO", Annex 5. 120. Id. , Annex 6. 121. Id. , Annex 7. 122. Id. , Annex 8. 123. Id. , Annex 5. 124. Id. , Annex 6. 125. Id. , Annex 7. 126. Id. , Annex 8. 127. Id. , Annex 3. 128. Exhibits "D", "F", "G", and "I". 129. Higher between the amount per Summary of Zero-Rated Sales/Receipts (Exhibit "OOO", Annex 3) and per Quarterly VAT Returns (Exhibits "D", "F", "G", and "I"). 130. Section 4.111-1 (a), Revenue Regulations No. 16-05. 131. Exhibits "UUU" to "UUU-164", "VVV" to "VVV-300", "WWW-WWW-91", and "XXX to XXX-17". 132. Exhibit "OOO", Annexes 112 and 126. 133. Id. , Annex 127. 134. Id. , Annex 128. 135. Id. , Annex 120. 136. Id. , Annexes 115, 121, and 130. 137. Id. , Annex 33. 138. Id. , Annex 54. 139. Id. , Annex 55. 140. Id. , Annex 34. 141. Id. , Annex 41. 142. Id. , Annex 42. 143. Id. , Annexes 43, 49, and 59. 144. Id. , Annexes 38, 44, and 60. 145. Id. , Annex 102. 146. Id. , Annex 103. 147. Id. , Annex 77. 148. Id. , Annex 88. 149. Id. , Annex 66. 150. Id. , Annexes 89 and 104. 151. Id. , Annexes, 67, 78, and 90. 152. Id. , Annex 79. 153. Id. , Annexes 68 and 91. 154. Id. , Annex 94. 155. Id. , Annexes 70 and 95. 156. Id. , Annexes 96 and 106. 157. Id. , Annex 107. 158. Id. , Annex 81. 159. Id. , Annex 108. 160. Id. , Annexes 71, 82, 97, and 109. 161. Id. , Annex 27. 162. Exhibit "ZZZ". 163. Exhibit "OOO", p. 22. 164. Id. , Annexes 20 and 23. 165. Id. , Annexes 17, 19, 21, and 24. 166. Per Schedules attached to the Quarterly VAT Returns (Exhibits "D", "F", "G", and "I"). 167. Id. 168. Exhibit Period Covered (CY 2009) Output Tax "D" 1st Quarter P967,551.32 "F" 2nd Quarter - "G" 3rd Quarter 1,010,500.36 "I" 4th Quarter 96,021.87 Total P2,074,073.55 =========== 169. Exhibits "J", "K", "L", "M", "III" and "JJJ". 170. Exhibit "N", line 23D, input VAT claim for the 1st quarter of 2009 in the amount of P4,085,030.49 was deducted. 171. Exhibit "JJJ", line 23D, input VAT claim for the 2nd quarter of 2009 in the amount of P5,736,852.20 was deducted. 172. Exhibit "III", line 23D, input VAT claim for the third and fourth quarters of 2009 in the total amount of P12,380,003.61 (P8,033,790.00 and 4,346,213.61) was deducted.