Commissioner of Internal Revenue v. Maja Development Corp.

THIRD DIVISION [CA-G.R. SP No. 36069. November 13, 2003.] COMMISSIONER OF INTERNAL REVENUE , petitioner , vs . MAJA DEVELOPMENT CORPORATION , respondents . D E C I S I O N VERZOLA , E. , J p : This is an appeal by way of petition for review from a Decision 1 of the Court of Tax Appeals (CTA) dated September 30, 1994, ordering petitioner to refund to respondent the amount of P111,502.40 representing its excess income tax payment for the year 1989, and from a Resolution 2 dated November 24, 1994, denying petitioner's motion for reconsideration. The issue to be answered in this petition is whether respondent has the right to claim for a tax refund, which accrued in the year 1989 after it had opted to apply the excess tax payment as tax credit for the year 1990. We rule in the affirmative. It is admitted that respondent had an excess income tax payment for the year 1989. During the succeeding two (2) years, respondent suffered losses; hence it had no tax liability. As a result, the tax credit it was applying for may not be applied in 1990, and the same necessarily remains unsatisfied. The application for tax credit remains unresolved by the petitioner. The CTA consequently ordered the petitioner to refund the excess tax payment or issue a tax credit in favor of respondent representing the same excess income tax payment: Petitioner argues that the excess income tax payment in 1989 that is sought to be refunded was already credited against respondent's tax liabilities for the first and second quarter of taxable year 1990. It concludes that respondent had previously benefited from crediting, thus, to allow respondent to claim for refund anew would essentially result In double benefit. This allegation is misleading. Under the present law, respondent has an option to treat the excess tax payment either as a tax refund or a tax credit for the succeeding taxable year. It is true that respondent initially opted to avail of a tax credit. Its application however was not acted upon by petitioner in due time. Sensing that its claim might prescribe, respondent filed a petition on April 14, 1992 before the CTA to claim for tax refund or credit. The filing of the petition does not make respondent guilty of benefiting twice from the same excess tax payment. When it applied initially for a tax credit, it does not follow that it had already benefited from it, or had received the tax credit by sheer application. That application remains as an application until petitioner has taken a favorable action. As a consequence, until such favorable action takes place, no benefit may be attributed in favor of respondent. An evaluation of the facts of the case leads us to affirm the decision and resolution appealed from. The pieces of evidence, which may show the alleged error committed by CTA, were never presented in this petition. Other than the self-serving statements and arguments presented, no other evidence was attached to the petition. It is a rule that bare allegations, unsubstantiated by evidence, are not equivalent to proof under our Rules of Court. 3 It is axiomatic that factual findings of trial courts are entitled to respect. 4 The conclusiveness of factual findings of lower courts may be set aside when: (1) the conclusion is a finding grounded entirely on speculation, surmise and conjectures; (2) the inference made is manifestly mistaken; (3) there is grave abuse of discretion; (4) the judgment is based on a misapprehension of facts; and (5) the findings of fact are premised on the absence of evidence and are contradicted by the evidence on record. 5 The foregoing exceptions are not present in the instant case. Sans any showing that certain facts of substance and significance have been overlooked or that the trial court's findings are arbitrary, the conclusions arrived at below must be respected and the judgment on the basis thereof affirmed. 6 WHEREFORE, the instant petition is hereby DISMISSED for LACK OF MERIT. The decision and resolution appealed from are hereby AFFIRMED in toto . SO ORDERED. Salazar-Fernando and Sundiam, JJ., concur. Footnotes * Pursuant to Section 6, Rule 43 of the Rules of Court, there is no need to implead the Court of Tax Appeals as pay-respondent. 1. Rollo , p. 35. 2. Rollo , p. 42. 3. Manzano vs. Perez, Sr., 362 SCRA 430 (2001). 4. People vs. Bayotas, 348 SCRA 627(2000). 5. Grefalde vs. Sandiganbayan, 348 SCRA 367(2000). 6. People vs. Arlee, 323 SCRA 201 (2000).