Case Summary (G.R. No. 203249)
Overview of the Case
This case primarily involves the interpretation of the mandatory periods stipulated in Section 112(D) of the National Internal Revenue Code concerning the filing for VAT refunds. The pivotal issue is whether the simultaneous filing of both administrative claims with the Bureau of Internal Revenue (BIR) and judicial claims with the Court of Tax Appeals (CTA) is permissible, particularly in light of the Supreme Court ruling in Commissioner of Internal Revenue v. Aichi Forging Company of Asia, Inc. (Aichi).
Facts of the Case
San Roque Power Corporation, a VAT-registered taxpayer, was granted zero-rating on its sales of electricity to the National Power Corporation between January 14, 2004, and December 31, 2004. The petitioner filed two separate administrative claims for the refund of unutilized input tax related to zero-rated sales, but due to the respondent’s inaction, it pursued its claims judicially with the CTA. The CTA Division initially granted part of the petitioner’s claims, but upon appeal by the CIR, the CTA En Banc dismissed the claims on grounds of prematurity.
Ruling of the CTA En Banc
The CTA En Banc ruled that the petitioner failed to comply with the 120-day and 30-day filing periods mandated by Section 112(D) of the NIRC. This ruling indicated that the judicial claims were prematurely filed since the petitioner had not waited for the full expiration of the 120-day period before filing for judicial relief.
Arguments Presented by the Petitioner
The petitioner contended that at the time it filed its judicial claims, there was no precedent established that limited the filing of such claims within the 120-day timeframe. It argued that the interpretations of the CTA prior to the Aichi decision permitted judicial claims as long as they were within the two-year prescriptive period. Furthermore, it challenged the retroactive application of the Aichi ruling on several grounds, including vested rights and the ex post facto rule.
Court’s Ruling on Non-Retroactive Application
The Court, while reaffirming the validity of the Aichi ruling, clarified that it did not find mention within the CTA En Banc decision that it relied on Aichi as a basis for dismissal. It held that the petitioner could not rely on the various CTA decisions to support the argument for permissible premature filings, declaring that only decisions from the Supreme Court form binding precedent.
Findings on the Mandatory Nature of Filing Periods
The ruling emphasized that the 120-day and 30-day periods established in Section 112(D) of the NIRC are mandatory and jurisdictional. Any claims filed prematurely fall outside the jurisdiction of the CTA unless an exception applies. The Court noted that there were no prior decisions allowing premature filing and that the Aichi rulings made clear the procedural requirements for claiming VAT refunds.
Jurisdictional Exception Recognized
However, the Court recognized that there was an exception as established in its previous ruling in Commissioner of Internal Revenue v. San Roque Power Corporation, particularly around BIR Ruling No. DA-489-03, which allowed taxpayers to file claims before the lapse of the 120-day period. Since the petitioner’s claims were filed between the issuance of this ruling and the promulgation of the Aichi ruling, this exception applied.
Application of the Exception
The Court found th
...continue readingCase Syllabus (G.R. No. 203249)
Overview of the Case
- The case revolves around the interpretation of the 120-day and 30-day periods provided in Section 112 (D) of the National Internal Revenue Code (NIRC) concerning claims for refund or credit of input VAT.
- The Supreme Court's ruling draws from the previous case, Commissioner of Internal Revenue v. Aichi Forging Company of Asia, Inc., which clarified the procedural requirements for filing both administrative claims with the Bureau of Internal Revenue (BIR) and judicial claims with the Court of Tax Appeals (CTA).
Background of the Case
- 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 January 14, 2004, until December 31, 2004.
- The petitioner filed two separate administrative claims for refund of unutilized input tax for different periods in December 2005 and February 2006.
- After inaction from the CIR, the petitioner filed petitions for review with the CTA, which were later partially granted by the CTA Division.
Ruling of the CTA En Banc
- The CTA En Banc dismissed the petitions for review on grounds of prematurity, asserting that the judicial claims were filed before the expiration of the mandatory 120-day period, thereby failing to exhaust administrative remedies.
- The dismissal was aligned with the findings in A