G.R. No. 174012 - Mactan-Cebu International Airport Authority vs. Tudtud

Petron Corporation (Petron) is engaged in the manufacture and marketing of petroleum products.
Petron imports alkylate, a raw material or blending component for ethanol-blended motor gasoline.

For January 2009 to August 2011 and April 2012, Petron made 22 separate importations of alkylate.
The Commissioner of Internal Revenue (CIR) issued Authorities to Release Imported Goods (ATRIGs) exempting Petron’s importation of alkylate from excise tax, stating alkylate was not subject to excise tax under Title VI of Republic Act No. 8424 (1997 National Internal Revenue Code, NIRC).
For importations from September 2011 to June 2012 (except April 2012), the CIR issued ATRIGs with a reservation clause, stating that excise taxes, penalties, and interest might be collected depending on the final resolution of whether alkylate is subject to excise tax under the NIRC.

Petron imported 12,802,660 liters of alkylate in June 2012, paying VAT of ₱41,657,533.00 as shown in Import Entry and Internal Revenue Declaration (IEIRD) No. SN 122406532.
The Collector of Customs (COC), following instructions from the Commissioner of Customs, subjected this import to excise taxes at ₱4.35 per liter (₱55,691,571.00 total) plus 12% VAT on the excise tax (₱6,682,989.00).
This assessment was based on Customs Memorandum Circular (CMC) No. 164-2012 dated July 18, 2012, implementing the CIR’s June 29, 2012 Letter which interpreted alkylate as subject to excise tax under Section 148(e) of the NIRC.

Petron filed a petition for review with the Court of Tax Appeals (CTA) under CTA Case No. 8544, questioning whether its importation of alkylate is subject to excise tax under Section 148(e) of the NIRC.
The CIR filed a motion to dismiss the petition on grounds of lack of jurisdiction and prematurity.
Initially, the CTA dismissed the petition on November 15, 2012.
Upon Petron’s motion for reconsideration, the CTA reversed its dismissal in a February 13, 2013 Resolution, allowing the petition to proceed.
The CTA denied the CIR’s motion for reconsideration on May 8, 2013.

The CTA found that the case concerned the propriety of the CIR’s interpretation of Section 148(e) of the NIRC, falling within the exclusive jurisdiction of the CTA under Section 4 of the NIRC as “other matters arising under” the Code.
The CTA also noted exceptional circumstances exempting Petron from exhausting administrative remedies due to potential irreparable damage.

The CIR filed a petition with the Supreme Court challenging the CTA’s assumption of jurisdiction, alleging grave abuse of discretion for taking cognizance despite lack of jurisdiction.

Whether the Court of Tax Appeals (CTA) has jurisdiction to entertain Petron Corporation’s petition contesting the imposition of excise tax on its importation of alkylate under Section 148(e) of the NIRC.

Whether the petition was premature due to failure to exhaust administrative remedies under the Tariff and Customs Code (TCC).