Title
Supreme Court
Commissioner of Internal Revenue vs. San Roque Power Corp.
Case
G.R. No. 187485
Decision Date
Feb 12, 2013
San Roque, Taganito, and Philex sought VAT refunds; claims dismissed for premature filing or prescription, emphasizing strict compliance with 120+30-day rule under NIRC.

Case Summary (G.R. No. 187485)

Petitioners and Respondents

• G.R. No. 187485: CIR v. San Roque Power Corporation (San Roque) – CIR seeks reversal of CTA En Banc decision granting partial refund to San Roque
• G.R. No. 196113: Taganito Mining Corporation (Taganito) v. CIR – Taganito seeks review of CTA En Banc dismissal of its refund claim for premature filing
• G.R. No. 197156: Philex Mining Corporation (Philex) v. CIR – Philex seeks review of CTA En Banc denial of its refund claim as barred by prescription

Key Dates

• San Roque – administrative claim filed March 28, 2003; judicial claim filed April 10, 2003 (13 days later)
• Taganito – administrative claim filed November 14, 2006; judicial claim filed February 14, 2007 (92 days later)
• Philex – administrative claim filed March 20, 2006; judicial claim filed October 17, 2007 (426 days later)
• Supreme Court Decisions: Atlas (June 8, 2007), Mirant (September 12, 2008), Aichi (October 6, 2010)

Applicable Law

• 1987 Constitution (decision dates ≥ 1990)
• National Internal Revenue Code (NIRC), as amended:
– Sec. 110(B): excess input VAT may, at taxpayer’s option, be refunded or credited, subject to Sec. 112
– Sec. 112(A): two-year prescriptive period to file administrative claim (zero-rated or effectively zero-rated sales)
– Sec. 112(D)/112(C): 120-day period for CIR to act on administrative claim; 30-day period to appeal CIR decision or inaction to CTA
– Sec. 229: two-year prescriptive period from date of payment applies only to erroneously or illegally collected taxes (not input VAT)
• Revenue Regulations (RR) 7-95, 14-2005, 16-2005 – implementing rules on VAT refund/credit procedures
• Revenue Memorandum Circulars (RMC) 42-03 and 49-03 – concurrent processing by BIR and CTA permitted
• BIR Ruling DA-489-03 (Dec. 10, 2003) – advised that judicial claim may be filed before 120-day lapse, giving taxpayers the option to seek CTA relief

Legal Standards for VAT Refund/Tax Credit

  1. Administrative claim for zero-rated input VAT must be filed within two years after the close of the taxable quarter when sales were made (Sec. 112(A)).
  2. CIR must decide the claim within 120 days of submission of complete documents (Sec. 112(D)).
  3. If CIR denies or fails to act within 120 days, taxpayer may appeal to CTA within 30 days of denial or lapse of 120 days (Sec. 112(D)).
  4. Input VAT is not an “erroneously or illegally collected” tax under Sec. 229, so Sec. 112 governs the refund/credit of excess input VAT.
  5. The 120-day and 30-day periods are mandatory and jurisdictional: premature or late judicial claims divest CTA of jurisdiction.

Facts and Procedural History

  1. San Roque (G.R. 187485)
    – Incurred excess input VAT of P560.2 million for 2001; filed administrative claim March 28, 2003.
    – Filed judicial claim with CTA April 10, 2003 (13 days later). CTA Second Division first denied, then on reconsideration granted P483.8 million. CTA En Banc affirmed. CIR petitioned to deny entire claim.
  2. Taganito (G.R. 196113)
    – Reported zero-rated sales and excess input VAT of P8.37 million for 2005; filed administrative claim November 14, 2006 (corrected period Nov. 29, 2006).
    – Filed judicial claim February 14, 2007 (92 days later). CTA Second Division granted P8.25 million; CTA En Banc reversed as premature under Sec. 112(D). Taganito petitioned for review.
  3. Philex (G.R. 197156)
    – Filed administrative claim for P23.96 million input VAT March 20, 2006. CIR failed to act.
    – Filed judicial claim October 17, 2007 (426 days after administrative claim). CTA Second Division denied as prescribed; CTA En Banc affirmed. Philex petitioned for review.

Issues

  1. Is a judicial claim filed before the lapse of the 120-day period under Sec. 112(D) prematurely filed and therefore jurisdictionally defective?
  2. Is a judicial claim filed more than 30 days after denial or lapse of 120 days barred by prescription?
  3. Do Sec. 112(A) and Sec. 112(D) grant any flexibility to file judicial claims within two years of payment or close of quarter, regardless of the 120+30-day rule?
  4. Can BIR Ruling DA-489-03 or RMC 49-03 estop CIR from invoking prematurity of judicial claims?

Supreme Court’s Ruling

  1. 120+30-Day Rule is Mandatory and Jurisdictional
    – Sec. 112(D) plainly requires CIR to act within 120 days and limits the taxpayer to a 30-day appeal window thereafter.
    – Failure to observe either period deprives CTA of jurisdiction over judicial claim. CTA may not entertain a judicial claim filed before CIR act/120 days or after the 30-day appeal period.
  2. Two-Year Period Governs Only Administrative Claim
    – Sec. 112(A) two-year prescriptive period applies to the filing of an administrative claim, not to the CTA appeal.
    – Claims filed administratively beyond two years are barred.
  3. Input VAT is Not an “Erroneously Collected” Tax
    – Sec. 229 applies only to erroneously or illegally collected taxes, not to excess input VAT. Hence Sec. 112 exclus






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