FIRST DIVISION
[G.R. No. 85956. April 10, 1989.]
COMMISSIONER OF INTERNAL REVENUE, petitioner, vs. ASIA AUSTRALIA EXPRESS LTD., respondent.
R E S O L U T I O N
Gentlemen :
Quoted hereunder, for your information, is a resolution of the First Division of this Court dated April 10, 1989:
After deliberating on the petition for review of the decision dated September 29, 1988 of the court of Tax Appeals in C.T.A. Case No. 3695 entitled "ASIA AUSTRALIA EXPRESS, LTD., represented by SORIAMONT STEAMSHIP AGENCIES, INC. vs. COMMISSIONER OF INTERNAL REVENUE," We find no reversible error in the decision of the court of Tax Appeals which ordered the petitioner to refund or credit to the private respondent the amount of P60,380.49, representing overpaid income taxes for fiscal years 1981 and 1982. Its ruling that the private respondent's right, to claim the refund of excess income taxes (paid by it in quarterly installments) for 1981 and 1982 had not yet prescribed is supported by Our decisions in Collector of Internal Revenue vs. Prieto, 2 SCRA 1007 and Commissioner of Internal Revenue vs. Palanca, Jr., 18 SCRA 496, where We ruled that "when a tax is paid in installments, the prescriptive period of two years provided in Section 306 (now Section 292) of the National Internal Revenue Code should be counted from the date of the final payment." The "final payment" is the last quarter payment at the end of the fiscal year when it is finally ascertainable that the taxpayer either made profits or suffered losses in its business operations.
For the last quarter of the fiscal year ending September 30, 1981, the private respondent filed its adjusted final tax return on January 14, 1982 and an Amended Final Adjusted corporate Annual Income Tax Return on July 5, 1982 declaring therein a tax due of P1,994.74 and, after crediting previous payments, showed a refundable amount of P38,146.26. 2005jurcd
Its final quarterly return for the fiscal year ending September 30, 1982 showed a net loss of P224,732.54.
It filed on May 9, 1983 a claim for refund of the excess income taxes it paid for the 1981 and 1982 fiscal years in the total amount of P60, 380.49. Since the two-year period within which it may claim a refund commenced to run, at the earliest, on January 14, 1982 when it filed its adjusted final tax return for 1981, and would have expired on January 14, 1984, the filing of its petition for refund in the Tax Court on October 26, 1983 was well within the two-year prescriptive period fixed ion Section 292 of the Tax Code. cdt
The decision in Guagua Electric Light Plant Company, Inc. vs. Collector of Internal Revenue, 1 SCRA 1221, cited in the petition for review, is inapplicable to this case because it involved a claim for refund of overpaid franchise tax. it did not involve income taxes paid in quarterly installments.
WHEREFORE, the decision for review is denied for lack of merit. We affirm the decision of the Court of Tax Appeals in toto.
Very truly yours,
ESTRELLA C. PAGTANA
Clerk of Court