Case Digest (G.R. No. 187485)
Facts:
In Commissioner of Internal Revenue v. San Roque Power Corporation (G.R. No. 187485, consolidated with G.R. Nos. 196113 and 197156), the Supreme Court, En Banc, resolved Motions for Reconsideration of its 12 February 2013 Decision. The Commissioner of Internal Revenue (CIR) had questioned the validity of BIR Ruling No. DA-489-03 issued on 10 December 2003 by Deputy Commissioner Buñag, which permitted taxpayers to file judicial claims for VAT refund before the 120-day administrative period lapsed. San Roque Power Corporation filed its administrative claim for input VAT refund on 28 March 2003 and prematurely filed a petition with the Court of Tax Appeals (CTA) on 10 April 2003. The CTA granted relief, but this Court, in Aichi Forging Company of Asia, Inc. v. CIR (6 October 2010), held that under Section 112(C) of the 1997 NIRC the 120-day + 30-day periods are mandatory and jurisdictional. San Roque moved that the new rule be given only prospective application. Taganito Mining andCase Digest (G.R. No. 187485)
Facts:
- Procedural Background
- San Roque Power Corporation filed a Motion for Reconsideration (MR) and Supplemental MR in G.R. No. 187485, seeking prospective application of the Court’s 12 February 2013 Decision.
- The Commissioner of Internal Revenue (CIR) filed an MR in G.R. No. 196113, urging disallowance of Taganito Mining Corporation’s judicial claim for VAT refund. Taganito filed a comment to that MR.
- Underlying Decision (12 February 2013)
- The Court held that under Section 112(C) of the 1997 NIRC, the 120-day period for the Commissioner to act on a VAT refund claim and the 30-day period to appeal are mandatory and jurisdictional.
- The Court recognized BIR Ruling No. DA-489-03 (10 December 2003), which allowed simultaneous administrative and judicial claims, as an operative fact from its issuance until this Court’s reversal in Aichi (6 October 2010).
- BIR Ruling No. DA-489-03
- Issued by Deputy Commissioner Buñag, it approved Lazi Bay Resources Development, Inc.’s practice of filing judicial claims with the CTA before the 120-day administrative period lapsed.
- Based on CA’s Hitachi decision, it diverged from the BIR’s prior position that the 120+30-day periods were mandatory.
- Arguments on Reconsideration
- San Roque: The Court’s rule should apply only prospectively; the BIR and CTA in practice did not enforce the 120+30-day periods, creating an operative fact.
- CIR: Taganito’s claim was premature; BIR Ruling No. DA-489-03 is invalid because issued by a Deputy Commissioner.
Issues:
- Operative Fact Doctrine
- Can an administrative practice, rather than a formal issuance, qualify as an operative fact exempting past non-compliance?
- Does BIR Ruling No. DA-489-03 meet the criteria of an operative fact under Section 246 of the Tax Code?
- Validity of BIR Ruling No. DA-489-03
- Did Deputy Commissioner Buñag have authority to issue a binding ruling under Sections 4 and 7 of the 1997 NIRC?
- Must taxpayers be allowed to rely in good faith on that ruling pending its reversal?
- Prospective vs. Retroactive Effect
- Should the Court’s February 2013 Decision be given only prospective effect?
- Does reliance on BIR Ruling No. DA-489-03 entitle San Roque and others to relief for past premature filings?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)