Facts:

The case involves San Roque Power Corporation (petitioner) and the Commissioner of Internal Revenue (respondent). The events leading to the case began when San Roque Power Corporation, a VAT-registered taxpayer, was granted a zero-rating on its sales of electricity to the National Power Corporation (NPC) effective from January 14, 2004, to December 31, 2004. On December 22, 2005, and February 27, 2006, the petitioner filed two separate administrative claims for the refund of unutilized input VAT for the periods of January 1, 2004, to March 31, 2004, and April 1, 2004, to December 31, 2004, respectively. Due to the inaction of the respondent, the petitioner filed petitions for review before the Court of Tax Appeals (CTA) on March 30, 2006, and June 20, 2006, for the respective periods, seeking refunds amounting to P17,017,648.31 and P14,959,061.57. The CTA Second Division initially granted a partial refund of P29,931,505.18. However, the Commissioner of Internal Revenue filed ...

Facts:

Background of the Case

San Roque Power Corporation (petitioner) is a VAT-registered taxpayer granted zero-rating on its sales of electricity to the National Power Corporation (NPC) from 14 January 2004 to 31 December 2004. The petitioner filed two separate administrative claims for refund of unutilized input VAT for the periods 1 January 2004 to 31 March 2004 and 1 April 2004 to 31 December 2004 on 22 December 2005 and 27 February 2006, respectively.

Filing of Judicial Claims

Due to the inaction of the Commissioner of Internal Revenue (CIR), the petitioner filed petitions for review before the Court of Tax Appeals (CTA) on 30 March 2006 and 20 June 2006, seeking refunds for the respective periods. The CTA Second Division partially granted the refund claims, but the CTA En Banc later dismissed the petitions on the ground of prematurity, citing the failure to observe the 120-day and 30-day periods under Section 112(D) of the National Internal Revenue Code (NIRC).

Petitioner's Arguments

The petitioner argued that at the time of filing, there was no established rule requiring the observance of the 120-day and 30-day periods. It relied on CTA decisions that allowed premature filing of judicial claims as long as they were within the two-year prescriptive period. The petitioner also contended that the retroactive application of the Supreme Court's ruling in Commissioner of Internal Revenue v. Aichi Forging Company of Asia, Inc. (Aichi) was improper, as it impaired vested rights and violated the ex post facto rule.

Issue:

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Ruling:

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Ratio:

1. Mandatory and Jurisdictional Nature of the 120-Day and 30-Day Periods: The 120-day and 30-day periods under Section 112(D) of the NIRC are mandatory and jurisdictional. Non-compliance with these periods renders a judicial claim void. This principle was established in Aichi and reiterated in San Roque.

2. Exception to the 120-Day Rule: BIR Ruling No. DA-489-03, issued on 10 December 2003, created an exception to the mandatory 120-day period. Taxpayers who filed judicial claims between 10 December 2003 and 6 October 2010 (the "window period") were not required to wait for the expiration of the 120-day period. This exception was based on the principle of equitable estoppel, which protects taxpayers who relied in good faith on the BIR ruling.

3. Application of BIR Ruling No. DA-489-03: The petitioner's judicial claims, filed on 30 March 2006 and 20 June 2006, fell within the window period. Therefore, the CTA had jurisdiction over the claims, and the petitioner was entitled to the refund. The Court emphasized that the benefit of BIR Ruling No. DA-489-03 applies to all taxpayers who filed judicial claims during the window period, regardless of whether they specifically invoked the ruling.

4. No Retroactive Application of Aichi: The Aichi ruling did not introduce a new rule but merely interpreted existing law. Thus, its application was not retroactive in a way that impaired vested rights or violated the ex post facto rule.

Conclusion:

The Supreme Court reinstated the CTA Second Division's decision, granting the petitioner's refund claim. The Court clarified that the 120-day and 30-day periods are generally mandatory and jurisdictional, but an exception exists for claims filed during the window period from 10 December 2003 to 6 October 2010, based on BIR Ruling No. DA-489-03.