Commissioner of Internal Revenue v. Process Machinery Co. Inc.

EN BANC [C.T.A. EB CASE NO. 1999. February 17, 2021.] (C.T.A. Case No. 9217) COMMISSIONER OF INTERNAL REVENUE , petitioner , vs. PROCESS MACHINERY CO., INC. , respondent . RESOLUTION MODESTO-SAN PEDRO , J p : Before this Court En Banc is petitioner's Motion for Reconsideration, filed through registered mail on 17 September 2020, 1 with respondent's Comment to Motion for Reconsideration ("Comment"), filed on 10 November 2020. 2 In the Motion for Reconsideration, 3 petitioner alleges that respondent should be held liable to pay deficiency Value Added Tax ("VAT") for issuance of VAT official receipts covering transactions amounting to Php29,750,076.39. This is because there must be a strict compliance with the invoicing requirements under the National Internal Revenue Code ("Tax Code") . If this Court En Banc will tolerate respondent's wrong policy of issuing VAT sales invoice and VAT official receipt for the same transaction, this will result in an absurd situation to the prejudice of the government because respondent's customers can claim the tax credit representing input VAT twice, while respondent only declared output VAT once in its VAT return. The government then ends up refunding a tax which has not been paid at all. In its Comment, 4 respondent counter-argues that: 1. The jurisprudence cited by petitioner in the Motion for Reconsideration are wholly inapplicable to the case at bar, considering that the same involves a VAT refund case while the present Petition for Review ("Petition") involves a deficiency tax assessment; 2. The Tax Code does not penalize a VAT-registered person by imposing VAT twice for one transaction as a result of issuing both a VAT invoice and a VAT official receipt for the same transaction; 3. Respondent's issuance of both a VAT invoice and a VAT official receipt for the same transaction was a result of petitioner's confusing revenue issuances; and IAETDc 4. It is highly unlikely that the government will refund a tax which has not been paid at all given the quantum of evidence necessary to prove entitlement to a tax refund. We deny the Motion for Reconsideration. The arguments raised therein are an exact copy of those raised by petitioner in his Petition filed before this Court En Banc . Thus, these have already been sufficiently tackled in the Decision, dated 17 July 2020. On this finding alone, this Motion for Reconsideration deserves scant consideration. This Court En Banc has no other recourse but to deny the Motion for Reconsideration for failure to raise an issue worthy of this Court En Banc's attention. WHEREFORE , the Motion for Reconsideration is hereby DENIED for lack of merit. SO ORDERED. (SGD.) MARIA ROWENA MODESTO-SAN PEDRO Associate Justice Roman G. del Rosario, P.J., Juanito C. Castaeda, Jr., Erlinda P. Uy, Ma. Belen M. Ringpis-Liban, Catherine T. Manahan and Jean Marie A. Bacorro-Villena, JJ. , concur. Footnotes 1. Records, pp. 90-94. 2. Id. , pp. 98-103. 3. Id. , pp. 90-91. 4. Id. , pp. 98-101.