Mercury Drug Corp. v. Commissioner of Internal Revenue

FORMER FIFTH DIVISION [CA-G.R. SP No. 63056. June 23, 2004.] MERCURY DRUG CORPORATION , petitioner , vs . COMMISSIONER OF INTERNAL REVENUE , respondent . R E S O L U T I O N CARANDANG , R ., J p : Before Us is a Motion for Reconsideration of Our Decision dated October 20, 2003 dismissing the petition for review filed by petitioner Mercury Drug Corporation seeking a partial modification of the Resolution of the Court of Tax Appeals in CTA Case No. 5315, entitled "MERCURY DRUG CORPORATION vs. COMMISSIONER OF INTERNAL REVENUE". Petitioner alleged that while this Court interpreted the term "cost" as including all direct expenses incurred by petitioner in complying with the requirement of giving 20% discounts on purchases of medicines by senior citizens under RA 7432, the Court of Tax Appeals appeared to have adopted a formula inconsistent with such definition, since the formula used grants an amount of tax credit less than what petitioner had actually incurred in complying with the law. We deny the motion. Petitioner sought to illustrate what it claims to be the proper method of computation that should be adopted to arrive at the actual amount petitioner had incurred in granting the mandated 20% Senior Citizen's Discount. There is no indubitable showing, however, that the allowable creditable amounts of P2,989,930.43 and P28,775,519.28, for 1993 and 1994, respectively, as computed by the Court of Tax Appeals, do not in fact correspond to the actual amounts spent by petitioner in granting the 20% Senior Citizen's Discount for the same years. Petitioner thus failed to substantiate its allegation that the formula adopted by the Court of Tax Appeals grants less than the actual amount directly spent by petitioner in complying with the requirements of the law. Moreover, as to the correctness of the formula used in arriving at the "cost" of the 20% discount to senior citizens, it must be noted that the Court of Tax Appeals employed the same computation in the case of Commissioner of Internal Revenue vs. Elmas Drug Corporation (CA-G.R. SP No. 49946, October 19, 1999), which case is now pending appeal before the Supreme Court. Considering therefore that the High Court has yet to ultimately pass upon the issue, it behooves this Court to maintain its earlier ruling on the matter until the Supreme Court's final pronouncement thereon. HDaACI All other arguments being essentially similar to those previously raised and passed upon in our Decision dated October 20, 2003, and there being no cogent reason to disturb the same, this Court resolves to DENY the motion for reconsideration for lack of merit. SO ORDERED. Labitoria and Gozo-Dadole, JJ. , concur.