CTA Case No. 4821 (Decision)

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY ALLEN ARTHUR (Manila), INC., C.T.A. CASE NO. 4821 Petitioner, --X - versus - COMMISSIONER OF INTERNAL REVENUE, Respondent. X- - - - - - - DECISION This is a judicial claim for tax credit of value- added taxes (VAT) in the amount of P329,295.71 representing input taxes on domestic purchase of taxable goods and services covering four taxable quarters from March 1, 1990 up to February 28, 1991. Petitioner is a corporation organized and existing under and by virtue of the laws of the Republic of the Philippines. It is engaged in the business of exporting toupees, wigs, wiglets, hairpieces and other related accessories, and also, of selling raw materials such as doll wigs, to export-oriented Board of Investment (BOI) registered enterprises; The antecedent facts are as follows: On December 20, 1991, petitioner filed with respondent a claim for tax credit of the abovestated 1367

DECISION - C.T.A. Case No. 4821. - 2- amount of input taxes in accordance with Section 106 (a) and (b) of the National Internal Revenue Code ( Tax Code, for brevity) in relation with Section 16 (a) of Revenue Regulations No. 5-87. On June 19, 1992, with the statutory period of two (2) years within which to file a claim for tax credit and/or refund of said VAT input taxes allegedly about to lapse without action on the part of the respondent, petitioner commenced the instant petition for review. Petitioner is a VAT registered entity with an approved application for zero-rating on its sales of raw materials to export-oriented HOI-registered enterprises pursuant to Sections 107 and 100 (a) (2) of the Tax Code. From March 1, 1990 to February 28, 1991, petitioner generated and recorded zero-rated sales amounting to P59,678,160.24 which were paid for in convertible foreign currency inwardly remitted through the banking system in accordance with existing regulations of the Central Bank of the Philippines. Correspondingly, it paid VAT input taxes on its domestic purchase of taxable goods and services allegedly attributable to said sales amounting to P329,295.71 for the same period. It further alleges that the input taxes being claimed for tax credit have not been applied to any VAT output tax liability during 1368

DECISION - C.T.A. Case No. 4821. - 3- said taxable quarters or any succeeding quarters pursuant to Section 106 of the Tax Code. (Petition for Review, p. 5) In her answer, respondent avers, inter alia, as special and affirmative defenses the failure of the petitioner to state any cause of action under Section 204 of the Tax Code. She asserts that petitioner begs the issue as it failed to show on the face of the petition that the collection of the tax liability in the amount of P329,295.71 is illegal and erroneous, as against the legal presumption that the collection thereof is lawful and regular. In addition, she alleges that the claim for "refund" is still under investigation, and thus prays for the dismissal ot the petition for lack of merit. lt is to be noted that respondent did not submit any quantum of evidence in support of her assertions including the filing of her memorandum, which leaves the court no recourse but to decide this case on the basis of pleadings, testimonies and evidences presented by petitioner. The only issue in this appeal is whether or not petitioner is entitled to the issuance of Tax Credit Certificate on VAT input taxes it paid. We rule in the affirmative. 13G9

DECISION - C.T.A. Case No. 4821. - 4- Petitioner has complied with the requirements of a valid claim for tax credit under Section 106 (a) and (b) of the Tax Code, as implemented by Revenue Regulations No. 5-87, as amended, namely: 1) The exporter must be VAT-registered; 2) An application for tax credit/refund of VAT paid (BIR Form No. 2552) shall be filed with the Revenue District Office; 3) A photocopy of the purchase invoice or receipt evidencing VAT paid shall be submitted together with the application; 4) Photocopy of export document showing the amount of export, and the date and destination of the goods exported; 5) Statement from the Central Bank or any of its accredited agent banks that the proceeds of the sale in acceptable foreign currency has been inwardly remitted and accounted for in accordance with applicable banking regulations; 6) That such input taxes paid has not been applied to output taxes; and, 7) The VAT (input tax) paid must be directly and entirely attributable to the goods exported. It has also made a timely appeal in accordance with Section 110 (b) in relation with Section 230 of the Tax -~- Code which provide, to quote: "SEC. 110. Return and payment of V<d ue-added tax.- XXX XXX 1370

DECISION - C.T.A. Case No. 4821. - 5- (b) Time for filing ot return and payment of tax.-The return shall be filed and the tax paid within 20 days following the end of each quarter specifically prescribed for a VAT-registered person XXX" (Underscoring supplied) "SEC. 230. Recovery of tax erroneously or illegally collected.- No suit or proceeding shall be maintained in any court for the rec.overy of any nat iona 1 internal revenue tax hereafter alleged to have been erroneously or illegally assessed or collected, or of any penalty claimed to have been collected without authority or of any sum alleged to have been excessive or in any manner wrongfully collected, un~il a claim for refund or credit has been duly filed with the Commissioner; but such suit or proceeding may be maintained, whether or not such tax, penalty, or sum has been paid under protest or duress. In any case, no suit or proceeding shall be begun after the expiration of two years from the date of payment of the tax or penalty regardless of any supervening cause that may arise after payment: Provided, however, That the Commissioner may, even without a written claim therefor, refund or credit any tax, where. on the face of the return upon which payment was made, such payment appears clearly to have been erroneously paid. XXX" (Underscoring supplied) The prayer of respondent that this case be dismissed ',1� on account bf its� alleged pendency before her office is not well taken. Our Supreme Court "has consistently adhered to the rule that the claim for refund [or credit] should first be filed with the Commissioner of Internal Revenue, and 13'71

DECISION - C.T.A. Case No. 4821. - 6- the subsequent appeal to the Court of Tax Appeals must be instituted, within the said two year period. If, however, the Commissioner takes time in deciding the claim, and the period of two years is about to end, the suit or proceeding must be started in the Court of Tax Appeals before the end of the two year period without awaiting the decision of the Commissioner."(Insular Lumber Co., Inc. vs. CTA, 104 SCRA 721) Records show that petitioner, in support of its claim, has formally offered in evidence the following documents 1) VAT registration certificate, 2) duly approved application for zero-rating of its sales of raw materials to Tikicraft Industries, Inc., an export- oriented BOT-registered enterprise, 3) BOI certification dated February 1, 1990 showing that Tikicraft Industries, Inc. has exported more than 70% of its total sales from January to December 1989 and favorably endorsing its application for zero-rating with the BIR, 4) application for tax crecJtt/refund of V~T (P,IR:fp_r~ ~~g. 2552), 5) VAT . J : .: . . ~ '. .i -�� qu~rterl:r t;~t4n1s 'aeparat~ly filec:J. on�� June 20, 1990, Septempet 20, 1Q,. 90, December 20, f; ~~f.9-:'0, and March 30, 1991, 6) schedu:l~ ~. of export sales, 7) sales invoices inclusive of airway bills/courier assig~~ent notes, certificates of marking and export de~l tration, 8) bank 1372

DECISION - C.T.A. Case No. 4821. - 7- credit advices/memoranda, 9)schedule of input, taxes, and 10) suppliers invoices and/or official receipts covering the period from March 1, 1990 to February 28, 1991. From the foregoing facts~ it can be gleaned readily that petitioner filed its VAT returns within the twenty- day period after the close of each quarter, and duly filed the instant appeal within the two-year period starting from the filing of the first VAT return with the respondent on June 20, 1990 up to the filing of herein petition for review on June 19, 1992. Likewise a closer examination of the VAT returns would dislose that petitioner has not applied the input taxes being claimed to any of its output tax liability. Evidently, petitioner's entitlement to tax credit is sufficiently established by the above-listed proofs. With input taxes definitely in excess of its zero-rated output tax, respondent thus collected such input taxes excessively or in a wrongful manner, and petitioner is, by provisions of Section 106 (a) and (b) in relation with Section 230 of the Tax Code, supra, clearly deserving of its claim for tax credit. A careful scrutiny however of the submitted invoices/receipts on domestic purchase of goods and services reveals that most of the input taxes are not 1 u'J ~t,u",

DECISION - C.T.A. Case No. 4821. - 8- directly and entirely attributable to the zero-rated transactions covered by the application for credit. Hence, input taxes on items such as medicines, office supplies, refrigerator, television set, gas range, copiers, repairs and maintenance of automobiles, grocery items, christmas lights and the like which cannot, in any manner, be directly and entirely attributed to the goods exported are excluded as part of the claim. Hereunder is the detailed computation of the amount of input taxes to be granted to petitioner as tax credit on its domestic purchase of goods and service, to wit: Supplier VAT Reg. No. Exh. Inv/OR t Date Inv. hount Cost Input Tax TBT Skypak 32A-7-000490 M-3 74202 03-31-90 895.00 813.64 81.36 1319 03-05-90 90.00 81.82 8.18 One-Source Enterprises 23-1-004 761 K-6 13759 03-10-90 7,908.75 7,189.77 718.98 149 03-12-90 1,520.00 152.00 Henkel Philippines, Inc. 32A-2-000255 K-14 150 03-12-90 1'6 72. 00 727.27 72.73 25693 03-12-90 800.00 11,681.82 1,168.18 Jarvi! Printing &Services 30-1-004076 H-25 8728 03-13-90 5,795.45 579.55 0043 03-14-90 12,850.00 2,590.91 259.09 Jarvi! Printing &Services 30-1-004076 H-26 6370 03-14-90 6,375.00 3,272.73 327.27 16122 03-14-90 2,850.00 27. 27 2. 73 Colorado Cheaical Sales 32-9-000084-87 H-27 20493 03-14-90 3,600.00 1,300.91 130.09 119279 03-16-90 14 5. 45 14.55 St. Louis International Corp. 30-1-002773 K-28 70079 03-09-90 30.00 13,636.36 1,363.64 20629 03-14-90 1,431.00 1,653.45 165.35 Chemdyes Corporation 31-900-4326 K-30 11919 03-21-90 172.73 17.2 7 13552 03-23-90 160.00 5,818.18 581.82 Nissin Metals Center 23-1-004191 H-32 113234 03-30-90 15,000.00 56.00 5.60 13766 04-11-90 I ,818.80 4,793.18 479.32 Goodwin General Merchandise 22-3000956 K-36 9062 04-11-90 4,359.09 435.91 17936 04-07-90 190.00 30.91 3.09 Williaa Bazar 22-0-001164 H-37 18529 04-19-90 6,400.00 395.45 39.55 7393 04-17-90 582.27 58.23 Filipinas lace Center 22-7-00676 H-39 22581 04-17-90 61.60 43.64 4.36 5,272.50 Ferdie's Coa�ercial 22-8-001877 K-40 4,795.00 Pacific Textile Traders 22-8-000598 H-41 34.00 435.00 Pa�o Fishing Supply 22-2-001691 K-45 640.50 48.00 Lion Chemical Corporation 30A-8-006 314 H-57 \leila Cheao-Technische Kfg. ,Inc. 34-9-000076 "-65 Henkel Philippines, Inc. 32A-2-000255 H-68 St. Louis International Corp. 30-1-002773 H-69 A/J Hortaleza Vaciador 33-2-000610 H-75 A/J Hortaleza Vaciador 33-2-000610 K-85 Oceanic Sales 22-2-000099 H-87 Pacific Textile Traders 22-8-000598 K-88 137lj

DECISION - C.T.A. Case No. 4821. -9 - Supplier VAT Reg. No. Exh. Inv/OR t Date Inv. A11ount Cost Input Tax ABC Hardware 23-9-005547 K-91 25!9 04-17-90 937.50 852.27 85' Z3 Worldwide Packaging 30-5-000443 K-92 6528 04-17-90 18,500.00 16,818.18 1,681.82 30-1-004076 K-95 152 04-21-90 1,045.00 Jarvi! Printing &Services 33-2-000610 K-96 18398 04-21-90 950.00 95.00 22-8-0018 77 K-97 70696 04-10-90 775.00 704.55 70. 45.. A/J Hortaleza Vaciador 32A-7-000490 H-99 75464 05-18-90 11,726.00 10,660.00 Ferdie's Coaaercial 22-7-00 359 3 K-100 8520 04-24-90 I ,590.90 1,446.27 1,066.00 TNT Skypak 23-9-005547 K-102 2550 04-24-90 772.73 144.63 Chelle -Hark Trading 22-8-000598 H-103 24559 04-24-90 850.00 681.82 ABC Hardware 32-9-000084-87 K-105 25885 04-11-90 750.00 401. 82 77' 27 Pacific Textile Traders 32-9-000084-87 H-106 25886 04-11-90 442.00 8,636.36 68' 18 Colorado Cbeaical Sales 23-7-003080 H-109 53085 04-25-90 9,500.00 4,090.91 40' 18 Colorado Che�ical Sales 22-5-000161 K-110 5219 04-17-90 4,500.00 9,454.55 863.64 Chaapion Stationery Co., Inc. 22-7-003593 H-112 8530 04-27-90 10,400.00 11,700.00 409.09 A.G.K. Coamercial 21-6-000079 H-117 20660 05-05-90 12,870.00 1,686. 36 945.45 Chelle-Hark Trading 21-6-000079 K-118 20408 05-04-90 1,855.00 I ,640.91 1,170.00 Polyfoam Cheaical Corporation 32-7-000698 H-120 361588 06-20-90 1,805.00 175.18 168.64 Polyfoam Chemical Corporation 3Q-1-004076 H-124 160 05-01-90 192.70 164.09 32A-2-000255 H-127 13792 05-12-90 2,092. II I I 901. 92 17.52 DHL Philippines Corporation 30-1-002713 K-128 9386 05-11-90 1,567.50 1,425.00 190.19 10-1-004076 H-129 163 05-12-90 8,787.50 7,988.64 142.50 Jarvi! Printing &Services 30A-8-006314 K-134 11822 05-11-90 10,460.00 9,509.09 798.86 23-9-005547 H-136 2709 05-15-90 1,045.00 950.91 Henkel Philippines, Inc. 22-0-001164 H-137 20607 05-15-90 6,950.00 950.00 95.00 St. Louis International Corp. 22-2-000099 H-138 7490 05-15-90 1,867.50 6,318.18 631.82 Jarvi! Printing &Services 22-8-000598 H-141 0271 05-15-90 1,719.00 1,697.73 Lion Chemical Corporation 30-l-004076 K-142 154 05-16-90 1,173.00 1,562.73 169' 77 ABC Hardware 32A-7-000490 H-146 68773 06-06-90 2,703.00 1,066.36 156.27 William Bazar 32-9-000084-87 K-149 26117 05-19-90 1,045.00 2,457.27 106.64 Oceanic Sales 32-9-000084-87 K-150 26055 05-11-90 3,304.62 245.73 Pacific Textile Traders 32-9-000084-07 K-151 26068 05-12-90 4,200.00 950.00 95.00 32-9-000081,-87 H-152 26069 05-12-90 16,200.00 3,004.20 300.42 Jarvil Printing &Services 22-5-000161 H-153 5319 05-15-90 17,550.00 3,818.18 381.82 32A-7-000490 K-156 15263 06-02-90 4,200.00 1,472.73 TNT Skypak 30-1-004076 H-157 170 06-05-90 15,495.00 14,727' 27 1,595.45 Colorado Chemical Sales 30-1-004076 K-158 171 06-05-90 1,589.30 15,954.55 381.82 Golorad~ Chemical Sales 23-1-003080 H-165 54031 06-11-90 1,045.00 3, 818' 18 1,408.64 Colorado Cheaical Sales 22-8-001877 H-167 11466 05-18-90 1,800.00 14,086.36 326.30 Colorado Chenical Sales 30-1-004076 K-168 175 06-13-90 5,200.00 3,263.00 95.00 A.G.H. Ooaaercial 30-5-000443 H-169 6564 06-14-90 15,000.00 163.64 TNT Skypak 22-8-000598 K-171 1285 06-15-90 836.00 950.00 472.73 22-1-001191 H-17 2 70666 06-15-90 18,500.00 1,636.36 1,363.64 Jarvi! Printing &Services 22-8-001877 K-173 71952 06-15-90 568.00 4,727.27 76.00 Jarvil Printing &Services 22-2-000099 H-174 7596 06-15-90 496.00 13,636.36 1,681.82 23-9-006776 H-175 0263 06-18-90 1,470.00 51.64 Ghaapion Stationery Co., Inc. JZA-2-000255 H-176 13193 06-16-90 865.00 760.00 45.09 Ferdie's Commercial 1,560.00 16,818.18 133.64 4,393.75 78.64 Jarvi! Printing &Services 516.36 141.82 450.91 399.43 Worldwide Packaging 1,336.36 Pacific Textile Traders 786.36 Bon Kee Commercial, Inc. 1 ,418.18 Ferdie's Com�ercial 3,994.32 Oceanic Sales A.G. Tan! i11co Co., Inc. Henkel Philippines, Inc. 1375

DECISION - C.T.A. Case No. 4821. - 10 - Supplier VAT Reg. No. Ex:h, rnv/OR t Date Inv. Amount Cost Input Tax Colorado Chemical Sales 32-9-000084-87 H-177 26270 06-14-90 6,500.00 5,909.09 590.91 30-1-004076 H-179 165 06-20-90 3,160.00 2,872. 73 287.27 Jarvi! Printing &Services 22-5-000161 K-197 5569 06-15-90 6,080.00 5,527.27 552.73 32H-000490 H-198 71333 07-31-90 2,580.60 2,346.00 2H.60 A.G.K. Coaaercial 32-7-000698 H-200 38 3995 07-23-90 2,276.09 2,069.17 206.92 TNT Skypak 32-7-000698 K-217 153337 05-10-90 54.82 DHL Philippines Corporation 22-0-001164 H-219 20700 07-07-90 603.07 548.25 DHL Philippines Corporation 30-l-002773 K-224 10090 70.00 63.64 6.36 llilliaa Bazar 07"01-90 7,555.00 6,868.18 686.82 St. Louis International Corp. 32-9-000084-87 K-227 26418 07-11-90 18,200.00� 16,545.45 1,654.55 Colorado Chemical Sales 30A-8-006314 H-234 14235 07-12-90 6,400.00 5,818.18 581.82 Lion Chemical Corporation 31-900-4326 K-236 0072 07-13-90 1,375.00 1,250.00 125.00 Cheadyes Corporation JZA-2-000255 H-241 14284 07-14-90 4,393.75 3,994.32 399.4] Henkel Philippines, Inc. 22-6-001176 K-243 459398 07-15-90 1,903.85 1,730.77 17 3. 08 Sengkon Trading 22-8-000598 H- 24 4 4215 07-16-90 2,319.00 2,108.18 210.82 Pacific Textile Traders 22-2-000099 H-245 7755 07-16-90 1,097.50 99 7. 13 99.77 Oceanic Sales 22-8-001877 H-246 72566 07-16-90 886.00 805.45 80.55 Ferdie's Commercial 22-8-001877 H-251 72450 07-11-90 9,000.00 8,181.82 818.18 Ferdie's Coamercial 30-1-004076 H-255 180 07-19-90 1,045.00 950.00 95.00 23-7-003080 K-256 54 771 07-13-90 6,240.00 5,672.13 567.27 Jarvi! Printing &Services 30-2-000586 H-260 71042 07-19-90 836.00 760.00 76.00 23-9-005547 K-262 3254 07-19-90 ' 750.00 681.82 68.18 Chaapion Stationery Co., Inc. 22-3000056 H-263 16655 07-19-90 61.36 Citkiason Import-Export, Inc. 23-9-005547 K-268 2841 07-23-90 67'50 2,386.36 6.14 ABC Hardware 30-l-004076 H-273 181 07-25-90 2,625.00 950.00 238.64 Goodwin General Merchandise 22-5-000161 H-280 5746 07-16-90 1,045.00 16,850.00 95.00 ABC Hardware 23-7-003080 H-284 55118 07-30-90 18,535.00 47,272.73 1,685.00 32A-7-000490 K-290 72814 09-08-90 52,000.00 7,798.36 4,727.27 Jarvi! Printing &Services 30-1-004076 H-295 182 08-03-90 8,578.20 855.00 77 9. 84 30-1-004076 H-301 156 08-06-90 760.00 85.50 A.G.K. Co�mercial 30-l-004076 H-302 183 08-07-90 940.50 950.00 76.00 Chaapion Stationery Co. I Inc. 32A-7-000490 H-303 72815 09-08-90 836.00 2,509.00 95.00 TNT Skypak 08-08-90 1,045.00 15,909.09 250.90 32-9-000084-87 H-306 26566 08-10-90 2,759.90 855.00 1,590.91 Jarvi! Printing &Services 30-1-004076 H-307 184 08-14-90 17,500.00 1,250.00 85.50 Jarvi! Printing &Services 31-900-4326 H-313 0078 08-15-90 940.50 16,683.64 125.00 Jarvi! Printing &Services 30-5-000443 H-315 6590 08-16-90 1,375.00 6,918.18 1,668. 36 30-l-002773 H-317 10506 08-20-90 18,352.00 1,425.00 691.82 TNT Skypak 30-1-004076 K-327 188 08-20-90 7,610.00 4,204.55 142.50 Colorado Chemical Sales 32A-2-00025S H-331 14348 08-21-90 1,567.50 1,493.64 420.45 22-8-001977 H-333 73231 08-21-90 4,625.00 1,982.27 149.36 Jarvi! Printing &Services 22-2-000099 H-335 7875 08-21-90 1,643.00 1,326.36 198.23 22-8-000598 H-339 9050 08-15-90 2,180.50 11,363.64 132.64 Chemdyes Corporation 22-8-001877 H-400 73189 08-23-90 1,459.00 950.00 1,136.36 Worldwide Packaging 30-l-004076 H-406 190 08-26-90 12,500.00 6,136.36 95.00 St. Louis International Corp. 30A-2-0000Z4 H-409 237900 08-29-90 1,045.00 1,615.00 613.64 30-l-004076 H-410 192 08-17-90 6,750.00 500.00 161. 50 Jarvi! Printing &Services 30A-8-006314 H-411 14431 1,776.50 50.00 550.00 Henkel Philippines, Inc. Ferdie's Commercial Oceanic Sales Pacific Textile Traders Ferdie's Commercial Jarvi! Printing &Services Republic Chemical Ind., Inc. Jarvi! Printing &Services Lion~Chemica1 Corporation 1376

DECISION - C.T.A. Case No. '�821. - 11 - Supplier v~r Reg. No. Exh. Inv/OR I Date Inv. Amount � Cost Input fax' TNT Skypak � 32A-7-000490 H-415 7640 7 09-29-90 2, 791.80 2,538.00 253.80 6054 08-21-90 9,276.00 8,432. 73 843.27 A.G.H. Co11ercial H-5-000161 K-428 042142 09-06-90 6,500.00 5,909.09 590.91 10780 09-10-90 12,125.00 11,022.73 1,102.27" California Che1ical Corp. 31~6-0001911 H-43J 238t.45 09-06-90 7,500.00 6,818.18 681.8 2 6604 09-14-90 18,500.00 16,818.18 1,681.82 St. Louis International Corp. 30-1-002713 H-437 10786 09.-11-90 35.00 26741 09-12-90 385.00 350.00 2,359.09 Republic Chemical Ind., Inc. JOA-2-000024 K-444 26749 09-12-90 25,950.00 23,590.91 4,159.09 14395 09-15-90 45,750.00 41,590.91 840.91 Worldwide Packaging 30-5-000443 H-451 14586 09-18-90 9,250.00 8,409.09 654.55 26742 09-12-90 7,200.00 6,545.45 1,390.91 St. Louis International Corp. 10-1-002713 K-452 26747 09-13-90 15,300.00 13,909:09 1, 990.91 194 09-20-90 21,900.00 19,909.09 76.00 Colorado Chemical Sales 32-~~000084-87 H-453 9999 09-20-90 12.55 478836 09-20-90 836.00 760.00 62.70 Colorado Cheaical Sales 32-9-000084-87 H-454 867 09-20-90 138.00 125.45 72.55 3095 09-17-90 627. 00 418.18 Henkel Philippines, Inc. 32A-2-000255 H-459 7964 09-20-90 689' 70 725.45 342 .l1 9994 09-20�90 798.00 4,181.82 104.55 Lion Cheaical Corporation 30A-8-006314 K-466 73693 09-13-90 4,600.00 3,422.73 1,985.09 195 09-27-90 3,765.00 1,045.45 136.36 Colorado Cheaical Sales 32-9�000084-87 H-469 73345 10-01-90 1'!50 0 00 19,850.91 24.73 77537 10-30-90 21,836.00 1,363.64 529.B3 Colorado Chemical Sales 32-9-000084-87 H-1.70 197 10-03-90 1,500.00 247.27 90.91 196 10-03-90 272.00 5,298.30 227.27 Jarvi! Printing &Services 30-1-004076 H-474 73425 10�03-90 5,828.13 909.09 l!. 32 l1 5961 10-04-90 1,000.00 2,272. 73 14. 18 Pacific Textile Traders 22-8-000598 H-476 0860 10-05-90 2,500.00 27. 64 202546 09-19-90 124.50 113' 18 608.61 Sangkon Trading 22-6-001176 K-480 160782 10-09-90 156.00 141.82 225.36 200 10-10-90 304.00 276.36 79.55 Joj ef Marketing 22-3-00 lt43 9 H-481 11076 10-11-90 6,694.73 6,086.12 154.55 080 10-11-90 2,479.00 2,253.64 153.41 Abc Hardware 23-9-005547 H-482 121505 . 10-12-90 875.00 795.45 68.18 54129 10-13-90 1,700.00 1,545.45 O'.eanic Sales 22-2-000099 K-483 18696 10-13-90 1,687.50 1,534.09 6.82 18703 10-15-90 750.00 681. 82 63.64 P~cific Textile Traders 22-8-000598 H-484 047948 10-18-90 75.00 68.19 190.91 8120 10-19-90 700.00 636.36 47. 06 rerdie's Commercial 22-8-001877 H-488 74327 10-19-90 2,100.00 1,909.09 122.73 48 7708 10-19-90 517. 70 470.64 185.00 Jarvi! Printing &Services 30-1-004076 H-492 269:wi 10-19-90 1,350.00 1,227.27 26.73 14633 10-20-90 2,035.00 440.91 Gitki1son Ilport-Export, Inc. 30-2-000586 K-503 203 10-22-90 294.00 1,8~0.00 840.91 205 10-25-90 4,850.00 170.45 TNT Skypak 32A-7-000490 H-510 9,250.00 267.27 1,875.00 4,409.09 113. 6'� Jarvi! Printing &Services 30-1-004076 H-515 1,250.00 8,409.09 1,704.55 Jarvi! Printing &Services 30-1-004076 K-516 1,136.36 Citkimson Import-Export, Inc. 30-2-000586 H-521 Sergon Marketing 23-7-003411 H-523 A.G. Tan! imco Co., Inc. 23-9-006 776 H-525 Allied Thread JH-000147 K-530 Wella Cheao�Technische Mfg. ,Inc. 34-9-000076 H-536 Jarvi! Printing &Services 30-1-004076 H-539 St. Louis International Corp. 30-l-002773 H-544 Cheadyes Corporation 31-900~4326 H-545 Champion Stationery Co., Inc. 23-7-003080 K-546 Citizen Shoe Supply 23-5-001797 H-551 Sheratori Shoe Supply 23~0-003567 H-552 Sheraton Shoe Supply 23-0-003567 K-553 Theo-Paa Trading Corporation 33-1-000199 K-564 Oceanic Sales 22-2-000099 H-567 Ferdie's Commercial 22-8-001877 H-568 Sengkon Trading 22-6�001176 H-571 Colorado Cheaical Sales 32-9-000084-87 H-578 Henkel Philippines, Inc. JZA-2-000255 H-579 Jarvi! Printing &�Services JO-l-004076 H-580 Jarvi! Printing &Services . J0-1-004076 H-585 1377

DECISION - C.T.A. Case No. 4821. - 12 - lier . No. Exh. Inv OR t Date Inv. Amount Cost In t Tax Jarvi! Printing &Services -004076 H-593 206 10-26-90 2,000.00 1,818.18 181.82 10-29-90 3,300.00 3,000.00 300.00 Jarvi! Printing &Services -004076 H-596 209 10-29-90 55.00 10-30-90 605.00 550.00 222.13� Lion Chemical Corporation -006314 H-597 14834 11-03-90 2,450.00. 2,227.27 772.65 11-02-90 8,499.15 7,726.50 363.64 Sheraton Shoe Supply -003567 H-603 18889 11-05-90 4,000.00 3,636.36 1,386.36 11-12-90 15,250.00 13,863.64 990.91 TNT Skypak -000490 H-608 020506 11-06-90 10,900.00 9,909.09 1,659.09 11-06-90 18,250.00 16,590.91 1,659.09 Gra1aege Ketalcraft -002517 H-610 056 11-14-90 18,250.00 16,590.91 270.44 11-06-90 2,974.80 2,704.36 1,659.09 Graaaege Hetalcraft -002517 H-611 061 11-10-90 18,250.00 16,590.91 771.36 Colorado Cheaical Sales 32 .. 008H7 H-628 27014 11-13-90 8,485.00 7,713.64 965.91 11-13-90 10,625.00 9,659.09 909.09 A.G.H. Conercial 2h,S-00016l H-630 6562 I 1-13-90 10,000.00 9,090.91 . 77.32 A.G.H. Commercial 22''~�'5-000161 H-631 6563 11-13-90 155.45 11-13-90 850.50 773.18 81.82 llella Cheao-Technische Kfg. ,Inc. 34~9-000076 H-632 167697 11-13-90 1,710.00 1,554.55 23.27 11-15-90 178.41 A.G.K. Commercial 2H-000161 H-630 6562 11-15-90 900.00 818.18 51.71 11-07-90 256.00 232.73 176.14 St. Louis International Gorp. 30�1-002773 H-633 ' 11369 11-16-90 1,962.50 l, 784.09 2,045.45 11-16-90 569.45 517.68 113.64 St. Louis International Corp. 30�1-002773 H-634 11414 12-18-90 1,937.50 1,761.36 1,443.86 11-19-90 22,500.00 20,454.55 1, 745.45 Sheraton ~hoe Supply 23�0-003567 H-635 19036 11-19-90 1,250.00 1,136.36 267.05 11-20-90 15,882.50 14,438.64 204.55 Sengkon Trading 22-6-001176 H-637 495324 11-13-90 19,200.00 17,454.55 429.55 11-20-90 2,937.50 2,670.45 159.09 Oceanic Sales 22-2-000099 K-638 8206 11-22-90 2,250.00 2,045.45 1,732.73 11-23-90 4,725.00 4,295.45 4,090.91 Pacific Textile Traders 22-9-000598 H-639 11635 11-19-90 1,750.00 1,590.91 212.50 11-21-90 19,060.00 17,327.27 178.41 Pamo Fishing Supply 22-2-001691 H-641 12494 11-20-90 45,000.00 40,909.09 315.00 11-23-90 2,337.50 2,125.00 262.50 Cheadyes Corporation 31-900-4326 H-652 090 11-24-90 1,962.50 1,784.09 170.45 11-26-90 3,465.00 3,150.00 754.55 Theo-Pam Trading Corporation 33-1-000199 H-653 048200 11-24-90 2,087.50 2,625.00 2,527.27 11-26-90 1,875.00 1,704.55 Jarvi! Printing &Services 30-1-004076 H-654 210 11-15-90 8,300.00 7,545.45 3,545.45 27,800.00 25,272.73 504.55 Worldwide Packaging 30-5-000443 H-659 6631 12-29-90 39,000.00 35,454.55 10-05-90 5,550.00 5,045.45 148.72 Jarvi! Printing &Services 30-1-004076 H-661 212 11-26-90 1,635.92 1,487. 20 1,030.91 12-03-90 11,340.00 10,309.09 1,197.73 Gramaege Hetalcraft 29-2-002517 H-663 049 12-03-90 13,175.00 11,977.27 9,155.00 8,322.73 832.27 Lion Chemical Corporation 30A-8-006314 H-674 14995 3,675.00 3,340.91 334.09 Jarvi! Printing &Services 30-1-004076 H-675 214 ABC Hardware 23-9-005547 H-680 3245 Dragon Knight Ind. Phil., Inc. 30-6-006605 K-682 17178 Dragon Knight Ind. Phil., Inc. 30-6-006605 H-683 17207 St. Louis International Corp. 30-l-002773 K-684 11534 Worldwide Packaging 30-5-000443 H-690 6639 Cheadyes Corporation 31-900-4326 H-692 692 Che1dyes Corporation 31-900-4326 H-693 095 Neo-Star Enterprises 29-9-003856 H-694 001 Neo-Star Enterprises 29-9-003056 H-695 002 ~arvil Printing &Services 30-1-004076 K-699 216 Graaaes~ Ketalcraft 29-2-002517 H-706 065 colorado cheilcat raJes H-!-OQ0084-87 H-707 27050 Champion Stationery Co., Inc. .. 23:7 ~003080 H-110 51612 Henkel Philippines, Inc. 3Zk2-000255 K-717 15103 TNT Skypak nH7-000490 H-720 79788 Ferdie's Commercial zHs-001877 H-724 74058 Sheraton Shoe Supply d~0-003567 H-725 19211 Oceanic Sales 2.Hh"'8'2--000010807979 H-739 8282 Ferdie's Co1aercial .u H-740 75349 I �'i! 13?8

DECISION - C.T.A. Case No. 4821. - 13 - Su tier . No. Exh. Inv/OR t Date Inv. hount Cost In ut Tax Bon Kee Com�ercial, Inc. -001191 H-142 74873 '12-03-90 1,480.00 1,345.45 134.55 New Sultana Modiste Kart 12-04-90 1,500.00 1,363.64 136.36 He Hardware -000022 K-7 45� 23572 12-05-90 6,000.00 5,454.55 545.45 Sengkon Trading 12-03-90 4,868.85 4,426.23 442.62 Paao Fishing Supply -005547 K-752 3410 12-05-90 Neo�Star Enterprises 1i-08-90 102.00 92.73 9.27 Neo-Star Enterprises -001176 H-753 501736 12-05-90 6,352.50 51 77 5o 00 577.50 Neo~star Enterprises 12-01-90 11,550.00 10,500.00 1,050.00 New Sultana Modiste Hart ~ . -001691 K-756 13844 12-10-90 6,352.50 5,775.00 577.50 Ferdie's Commercial 29~ '-003856 H-761 005 12-10-90 1,200.00 1,090.91 109.09 Lion Cheaical Corporation 12-10-90 25.09 Cha11pion Stationery Co., Inc. 29l9-003856 H-762 004 12-10-90 276.00 250.91 120.91 Neo-Star Enterprises 12-12-90 1,330.00 1,209.09 11.82 Neo-Star Enterprises 29-9-003856 H-763 003 12-12-90 498.75 Ferdie's Com1ercial 12-13-90 130.00 118.18 367.50 Citkiason Import-Export, Inc. 22-4-000022 K-767 23663 12-14-90 5,486.25 4,987.50 Coa1oners' Comaercial 12-14-90 4,042.50 3,675.00 334.18 Ferdie's Co1mercial 22-8-001877 K-768 75540 12-14-90 3, 676. 00 3,341.82 47.18 Henkel Philippines, Inc. 12-15-90 43.64 Neo-Star Enterprises 30A-8-006314 K-777 14015 12-15-90 519.00 471.82 66.91 Neo-Star Enterprises 12-17-90 480.00 436.36 925.00 Jarvi! Printing &Services 23-7-003080 H-781 57994 12-05-90 736.00 669.09 420.00 Allied Thread 12-10-90 10 J 175.00 9,250.00 393.75 TNT Skypak 29-9-003856 K-783 007 02-19-91 4,620.00 4,200.00 193.18 Graaaege Ketalcraft 01-08-91 4,331. 25 3,937.50 555.31 Neo-Star Enterprises 29-9-003956 K-784 006 01-12-91 2,125.00 1,931.92 434.72 Neo-Star Enterprises 01-15-91 6,108.44 5,553.13 222. 73 Gramaege Hetalcraft 22-8-001977 K-786 75632 01-15-91 4,781.92 4,347. 20 446.25 Gramaege Ketalcraft 01-15-91 2,450.00 2,227.27 472.50 Graaaege Hetalcraft 30-2-000586 K-787 75779 01-09-91 4,908.75 4,462.50 113.64 Gramaege Hetalcraft 01-15-91 5,197.50 4, 725.00 777.27 TNT Skypak 22-8-001117 K-788 15928 02-19-91 1,250.00 1,136.36 127.27 Bon Kee Commercial, Inc. 01-17-91 8,550.00 7,772.73 418.18 A.G.K. Commercial 22-8-001877 K-789 75650 01-25-91 1,400.00 1,272. 73 94.38 Citkitson Import-Export, Inc. 01-25-91 4,600.00 4,181.82 18.00 South East Commercial Corporation 32A-2-0002S5 K-790 15181 01-25-91 1,038.18 943.80 6.82 Pa11o Fishing Supply 01-25-91 198.00 180.00 1H.OO Prosperity Hardware 29+003956 K-794 008 01-25-91 75.00 68.18 531.82 Pacific Textile Traders 01-25-91 1,254.00 1,140.00 21.45 Gra1aege Heta!craft 29-9-003856 K-795 009 01-26-91 5,850.00 193.19 TNT Skypak 01-26-91 236.00 5'3 18.19 95.45 30-1-004076 H-805 217 01-26-91 2,125.00 214. 55 3,129.55 Jarvi! Printing &Services 01-28-91 1,050.00 94.38 Jarvi! Printing &Services 35-4-000147 K-810 210007 01-26-91 34,1,25.00 1,931.82 170.45 01-30-91 1,038.18 954.55 209.09 Henkel Philippines, Inc. 32A-7-000490 K-815 81317 02-02-91 723.64 Jarvi! Printing &Services 1,875.00 31,295.45 113.64 TNT Skypak 29-2-002517 H-828 069 2,300.00 943.90 95.80 7,960.00 29-9-003856 K-833 010 1,250.00 1,704.55 2,090.91 29-9-003356 K-8311 011 94 3.80 7,236.36 1,136.36 29-2-002517 H-835 071 858.00 29-2-002517 H-836 073 29-2-002517 K-837 070 29-2-002517 K-838 072 32A-7-000490 K-847 82441 22- 7- 00 11 91 K-849 261495 22-5-000161 K-054 47133 30-2-000586 K-855 76857 23-7-003000 K-857 17945 22-2-001691 K-858 12664 23-4-001691 K-859 20105 22-8-000598 K-860 13948 29-2-002517 K-861 074 n -1-ooo49o H-862 023585 ~ :~~-004076 K-965 229 .. '' 230 -004076 K-866 ~ooom K-B67 15497 '-004076 K-8 72 231 -000490 H-874 023716 13?8

DECISION - C.T.A. Case No. 4821. , No. Exh. Inv Inv. hount Cost Neo-Star Enterprises 03856 H-875 012 02-01-91 6,930.00 6,300.00 630.00 H-877 228 01-23-91 2,500.00 2,272.73 221.27 Jarvi! Printing &ServicesI. -000161 K-884 013 02-05-91 5,763.45 5,239.50 523.95 .. -000161 M-886 02-05-91 1,250.00 1,136.36 113 '64 Neo-Star Enterprises -004076 H-887 233 02-07-91 7,218.75 6,562.50 656.25 -003856 H-888 02-08-91 21.09 Jarvi! Printing &Services l �A~7-000490 K-890 014 01-25-91 232.00 210.91 1,568.73 29-9-003856 H-891 1W7 01-26-91 17,256.00 15,687.27 1,501.27 Neo-Star Enterprises H-893 6945 02-08-91 16,514.00 15,012.73 227.27 H-895 6948 02-09-91 2,500.00 2,272.73 472.50 Pacific Textile Traders H-896 02-09-91 5,197.50 4,725.00 188.76 K-898 235 02-12-91 2,076.36 1,887.60 315.00 A.G.H. Co1aercial 015 3,465.00 3,150.00 024583 A.G.H. CoMmercial 016 Jarvi! Printing &Services Neo-Star Enterprises TNT Skypak Neo-Star Enterprises Well a Cheao-Technische Hfg. ,Inc . 34-9-000076 M-904 173301 02-14-91 2,974.80 2,704.36 270.44 1,363.64 136.36 Jarvi) Printing &Services . 30-1-004076 H-905 237 02-14-91 1,500.00 34,090.91 3,409.09 28,181.82 2,818.18 Colorado Cheaical Sales 32-9-000084-87 11-911 27246 02-12-91 37,500.00 1,784.09 178.4t 1,917.29 191.73 Colorado Che~ical Sales 32-9-000084-87 H-912 27243 02-12-91 31,000.00 7,181.82 718.18 11,681.82 1,168.18 Ghemdyes Corporation 11-900-4326 H-915 121 02-16-91 1,962.50 1,136.36 1,483.64 ll3.6~ TNT Skypak 32A-7-000490 H-916 024758 02-16-91 2,109.02 229.09 148.36 Quality Labels, Inc. 10-9-002056 K-919 2116 5 02-28-91 7,900.00 3,654.00 22.91 3,515.05 365.4il Lion Chemical Corporation 30A-8-006114 H-919 15313 02-16-91 12,850.00 2,766.82 351. 50 276.68 Jarvi! Printing &Services 30-1-0011076 H-930 242 02-22-91 1,250.00 327.27 32.73 7,529.09 752.91 A.G.H. Co�aercial 22-5-000161 H-934 7084 02-22-91 1,632.00 1,090.91 109.09 1,956.36 195.64 Joros Enterprises 22-8-000291 H-93~ 26042 02-22-91 252.00 10,909.09 1,090.91Q 81.15 Neo-Star Enterprises 29-9-003856 H-936 017 02-23-91 4,019.40 87 I. 50 TNT Skypak 32A-H00490 K-938 024933 02-23-91 3,866.55 Pacific Textile Traders 22-8-000598 H-939 15014 02-21-91 3,043.50 Pamo Fishing Supply 22-2-001691 H-940 12728 02-22-91 360.00 South East Commercial Corporation 23-7-003000 H-941 18588 02-22-91 8,282.00 Bon Kee Couercial, Inc. 22-7-00Il91 H-942 76828 02-22-91 1,200.00 Oceanic Sales 22�2-000099 K-9H 8561 02-22-91 4,352.00 Gra1aege Hetalcraft 29-2-002517 K-952 077 02-26-91 12,000.00 TNT Skypak JZA-7-000490 H-955 02H10 02-0H I _ ___;9:.:.59.;.;.'.:.:;.65 T0 TAL 1,621,614.97 1,474,195.36 147,419.61 "It must be stressed at this point that a refund [or tax credit] of taxes partakes the nature of a tax exemption and are construed in strictissimi juris against the taxpayer and of the taxing authority." (Associated Sugar, CIR, CTA Case No. 2944, May 1380

�� ' DECISION - C.T.A. Case No. 4821. - 15 - 6, 1994, p.4 citing Insular Lumber Co. vs. CTA, supra, and CIR vs. Rio Tuba Nickel Mining Corp., 207 SCRA 549) WHEREFORE, in view of the foregoing, this Court hereby orders the issuance of a tax credit certificate in the amount of Pl47,419.61 in favor of the petitioner. SO ORDERED. 9~.. ~. ~ ERNESTO D. ACOSTA Presiding Judge ,I ;'/ CERTIFICATION 1 hereby certify that Ll1is decision was reached after d11e consultatjou among the members of the Court of Tax Appeals in accordance with Section 13, Article VIII of the Constitution. Q~~G~ ERNESTO D. ACOSTA Presiding Judge Court of Tax Appeals :~ ' 1381