Commissioner of Internal Revenue v. AIG Shares Service Corp. (Philippines)

EN BANC [C.T.A. EB CASE NO. 2545. October 17, 2023.] (C.T.A. Case No. 9351) COMMISSIONER OF INTERNAL REVENUE , petitioner , vs. AIG SHARED SERVICES CORPORATION (PHILIPPINES) [Formerly: CHARTIS TECHNOLOGY AND OPERATIONS MANAGEMENT CORPORATION] , respondent. RESOLUTION REYES-FAJARDO , J p : For the Court's resolution is the Commissioner of Internal Revenue (CIR)'s Motion for Reconsideration 1 of the Decision dated March 27, 2023, which denied the CIR's Petition for Review and upheld the ruling of the Court of Tax Appeals Third Division (Court in Division). Previously, the Court in Division partially granted respondent AIG Shared Services Corporation (Philippines) (AIG Philippines)'s judicial claim for refund or issuance of tax credit relative to unutilized excess input value-added tax (VAT) attributable to zero-rated sales in CTA Case No. 9351. In the instant Motion, the CIR mainly reiterates that respondent AIG Philippines is not entitled to any refund or credit and, in fact, is still liable for deficiency VAT. 2 On June 23, 2023, the CIR's Motion for Reconsideration, with AIG Philippines's Comment/Opposition, 3 was submitted for resolution. CAIHTE After a careful review of the records of the present case, the Court finds no compelling reason to reverse or modify the Assailed Decision. The instant motion raises the same argument already passed upon and discussed at length by the Court. The CIR has not adduced any substantial argument to warrant reconsideration or modification of the Assailed Decision. It is already settled that if the issues raised in the motion for reconsideration are mere reiterations of those which have already been passed upon and, in fact, adjudged as unmeritorious by the Court, these cannot be regarded as substantial and no longer require another full-blown discussion. Any further discourse will only be unnecessary and repetitive. 4 Be that as it may, We underscore that, in refund cases, the Court has no authority to determine possible deficiency tax and assess the claimant on the basis thereof. Verily, the courts have the power to review tax assessments issued by the CIR. However, it has no assessment powers and cannot, by itself, assess a taxpayer for deficiency taxes. 5 The law 6 vests sole authority to the CIR to make such assessments. And, as a matter of due process, an administrative remedial process 7 is mandated as a condition precedent to the judicial determination of liability for deficiency taxes. Certainly, We cannot allow the tax authorities "to use a claim for refund under Section 112 of the Tax Code as a means to assess a taxpayer for any deficiency VAT, especially if the period to assess had already prescribed." 8 WHEREFORE , in light of the foregoing considerations, the Commissioner of Internal Revenue's Motion for Reconsideration of the Decision dated March 27, 2023 is DENIED for lack of merit. HTcADC SO ORDERED. (SGD.) MARIAN IVY F. REYES-FAJARDO Associate Justice Roman G. del Rosario, P.J., Ma. Belen M. Ringpis-Liban, Catherine T. Manahan, Jean Marie A. Bacorro-Villena, Maria Rowena Modesto-San Pedro, Lanee S. Cui-David and Corazon G. Ferrer-Flores, JJ. , concur . Henry S. Angeles, J. , is on leave. Footnotes 1. Rollo , pp. 120-126. 2. Rollo , p. 123. 3. Rollo , pp. 134-140. 4. Social Justice Society (SJS) Officers, et al. v. Lim , G.R. Nos. 187836 & 187916, March 10, 2015. 5. Commissioner of Internal Revenue v. Toledo Power Company , G.R. Nos. 196415 & 196451, December 2, 2015. 6. Section 6, Tax Code. 7. Section 228, Tax Code. 8. Commissioner of Internal Revenue v. Toledo Power Company , G.R. Nos. 196415 & 196451, December 2, 2015.