G.R. No. 111211 - ABS-CBN Employees Union vs. National Labor Relations Commission

Hedcor Sibulan, Inc. (HSI) is a domestic corporation principally engaged in the business of power generation through hydropower and the subsequent sale of generated power.
The Commissioner of Internal Revenue (CIR) is the petitioner, while HSI is the respondent in the case.

On April 21, 2008, HSI filed its Original Quarterly VAT Returns for the first quarter of calendar year 2008.
On May 20, 2008, HSI filed its Amended Quarterly VAT Returns for the same period, showing unutilized input VAT amounting to ₱9,379,866.27.
HSI had no local sales subject to the 12% VAT rate, meaning it did not incur any output VAT liability against which to apply the unutilized input VAT.

HSI filed an administrative claim for refund of its unutilized input VAT on March 29, 2010.
Subsequently, on March 30, 2010—just one day after the administrative claim—HSI filed its judicial claim for refund with the Court of Tax Appeals (CTA), docketed as CTA Case No. 8051.

The CTA Division initially dismissed HSI’s judicial claim on the ground that it was prematurely filed, basing its decision on the mandatory waiting period prescribed under Section 112(C) of the National Internal Revenue Code (NIRC) of 1997, as clarified in Commissioner of Internal Revenue v. Aichi Forging Company of Asia, Inc.
HSI filed a motion for reconsideration with the CTA Division, which was denied in the Resolution dated March 28, 2012.
HSI elevated the dispute to the CTA En Banc, arguing that:

On December 6, 2012, the CTA En Banc rendered a Decision affirming the dismissal but, in light of further jurisprudence, later reversed its earlier ruling in an Amended Decision on May 30, 2013, and remanded the case to the CTA Division for a complete determination of HSI’s refund claim.
The CIR then filed a motion for reconsideration, which was denied by the CTA En Banc in its Resolution dated September 17, 2013.

Section 112(C) of the NIRC of 1997, as amended, provides that the CIR has a 120-day period to grant or deny a refund claim, after which the taxpayer has an additional 30-day period to file a petition for review with the CTA.
The Court in Aichi held that these periods are mandatory and jurisdictional, meaning failure to observe them is fatal to a judicial claim.
However, later decisions, including San Roque and Taganito Mining Corporation v. Commissioner of Internal Revenue, recognized an exception arising from BIR Ruling No. DA-489-03, which allowed taxpayers to file judicial claims before the lapse of the 120-day period when misled by the Commissioner’s interpretative guidance.

Whether HSI’s judicial claim for refund/credit, filed on March 30, 2010—just one day after filing its administrative claim—was premature in light of the mandatory 120-day period provided under Section 112(C) of the NIRC.

Whether HSI is entitled to a refund or tax credit for its alleged unutilized input VAT of ₱9,379,866.27 for the first quarter of calendar year 2008.

Whether the exception provided by BIR Ruling No. DA-489-03, as interpreted in later cases such as San Roque and Taganito, applies to shield HSI from the vice of prematurity and thus validate its judicial claim.