Case Digest (G.R. No. 127624)
Facts:
BPI Leasing Corporation v. The Honorable Court of Appeals, Court of Tax Appeal and Commissioner of Internal Revenue, G.R. No. 127624, November 18, 2003, Supreme Court First Division, Azcuna, J., writing for the Court.
BPI Leasing Corporation (BLC) is engaged in the business of leasing properties. For calendar year 1986 BLC paid P1,139,041.49 to the Commissioner of Internal Revenue (CIR) as the 4% "contractor’s percentage tax" then imposed by Section 205 of the National Internal Revenue Code (NIRC), computed on gross rentals from equipment leasing totaling P27,783,725.42.
On November 10, 1986 the CIR issued Revenue Regulation No. 19-86. Section 6.2 provided that finance and leasing companies registered under Republic Act No. 5980 would be subject to gross receipts tax (5%-3%-1%) on actual income earned, i.e., taxation under Section 260 (now Section 122) rather than the contractor’s percentage tax under Section 205. Recomputing its liability under the gross receipts tax, BLC calculated it should have paid only P361,924.44.
On April 11, 1988 BLC filed a claim for refund with the CIR for the difference of P777,117.05, and four days later filed a petition with the Court of Tax Appeals (CTA) to stop the running of prescription. In a decision dated May 13, 1994, the CTA dismissed the petition and denied the refund, holding that Revenue Regulation 19-86, pursuant to its own Section 7, took effect January 1, 1987 and applied only to leases written on or after that date; because BLC’s rental income derived from leases prior to January 1, 1987 the regulation did not apply.
The CTA denied reconsideration in a resolution dated July 26, 1995. BLC appealed to the Court of Appeals (CA) which, in CA-G.R. SP No. 38223, affirmed the CTA decision and denied BLC’s motion for reconsideration. BLC filed a petition for review on certiorari under Rule 45 to the Supreme Court. In a resolution dated March 29, 2000 the Court gave the petition due course and required memoranda, after which ...(Subscriber-Only)
Issues:
- Did the petition substantially comply with Supreme Court Circular No. 28-91 (now Sec. 2, Rule 42) as to the Certification/Verification against forum shopping?
- Is Revenue Regulation No. 19-86 legislative or interpretative in nature?
- Is Revenue Regulation No. 19-86 prospective or retroactive in its application?
- Did petitioner fail to meet the quantum of evidence required in refund cases?
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Ruling:
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Ratio:
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Doctrine:
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