CTA Case No. 5594 (Decision)

l)./- ..� '� REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY HITACHI COMPUTER PRODUCTS (ASIA) CORPORATION, Petitioner, -versus- C.T.A. C1\SE NO. 5594 COMMISSIONER OF INTERNAL j. 'L PromUul!:?.1.t. cnidJ : r1r.\.-.�Jl)' \/.)._..C..,I;--:'.2------ . REVENUE, Respondent. --------------7'- ,__) X----------- - ----- - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - - - ---- - - - -X DECISION This petition for review is seeking for the refund or issuance of tax crccli t ccrli fictlc in the amount of P925,041.23, representing unutilized input value-added lax (VAT, for brevity) attributable to zero-rated export sales for the period January 1, 199G to Morell 3 I, 1996. Petitioner is a domestic corporation duly organized and exis ti ng under the laws of the Republic q.Lthe Philippines with office address located in Special Export Processing Zone, Laguna Teclmopark, Binan, Laguna: It is engaged in the business of manufacturing computer parts or diskettes. It is an export enterprise registered wiLh the Export Processing Zone Authority pursuant to the provisions of the Omnibus Jnvcslm_�;lts Code of 1987 bearing Certificate of Registration No. 94-28, c!Jtcd May 11, I 99�-! (!\nncx B). It is likewise registered with the Bureau of Internal Revenue as a VAT-rq;istcrcd 1 n- ,t.J t-J,

DECISION- CTA CASE NO. 5594 PAGE2 entity with VAT Registration Cetiificate No. 003-877-830, dated June 28, J 994 (Annex A). For the period January 1, 1996 to March 31, 1996, petitioner filed its qaarterly VAT return on April 22, 1996, showing a total input tax payment in the su:-:1 of P925,041.23 (Annex C) which petitioner alleges to be payment of input V J\T on domestic purchases of taxable goods and services. On March 30, 1998, petitioner filed with the Tax & Revenue Group of the One- Stop-Shop Inter-Agency Tax Credit and Duty Drawback Center of tile Dc:partmc:1t of Finance an application for tax credit/refund of value-added t;:x p;:id for the pcri0d January 1, 1996 to March 31, J 996, in the amount of P925,041.23, rcprcs::n: ting inpull::\: payments attributable to its zero-rated export sales (Annex "D"). Without waiting for an action from the respondent, petitioner on March 31, 1998, filed the instant petition for review in order to toll the running of the two-year prescriptive period pursuant to Section 230 of the Tax Code, as amended In his Answer, respondent raises the following Special and Affirmative dcknscs: 5. 'Petitioner's claim for refund/tax credit IS still undcq;oing administrative routinary investigation/examination; 6. Petitioner miserably failed to demonstrate that the t1x subject of the case at bar was erroneously or illegally collected; 7. The total amount of P925,041.23 claimed by petitioner as excess creditable VAT input taxes was not properly documented; 8. Taxes paid and collected are presumed to have been mack m accordance with law and regulations, hence, not rcfuncbblc;

DECISION- CTA CASE NO. 5594 PAGE3 9. In an action for tax refund/credit, the burden of proof is upo11 1:1...: taxpayer who must establish his right to refund and 1:1ilu, c lu susLtin 1:,--: burden is fatal to the action for tax refund/credit; 10. It is incumbent upon the petitioner to show that it has C0!11Jl]ic.l. with the provisions of Section 204 in relation to Section 230 l)f the �r;:x Code, as amended; and 11. Well-settled is the rule that claims for tax crcclit/rcfund arc construed in strictissimi juris against the taxpayer as it p::rLd\ ...�., l;w nature of exemption from tax and it is incumbent upon the pditil.l;. icr to show that it is entitled thereto under the law. The sole issue to be resolved in this case is whether or no! petitioner is cncitkd lo the refund or issuance of tax credit certificate in the amount ofP925,0�f1 .23. We answer in the negative. The instant petition deserves an outright denial for failure of petitioner Lo [ilc ils formal offer of evidence that will support its claim for refund. The records show that petitioner failed to formally offer the documcnltry exhibits presented during trial. When the original counsel, Atty. Jauriguc did linally pn.:scnt evidence, it consisted only of four (4) documents contrary to the alkgccl "one hundn:d (100) more or less" documents which he failed to formally offer as evidence. Moreover, this Court finds it disconcerting why petitioner did not exert any effort to get a certification from the commissioned independent CPA regardin g the cxami!1alion of documents supporting its claim and formally offer it as evidence. Petitioner's counsel thought of the same only after the case was considered by this Court ::s submi ttcd for decision. It becomes apparent from the records that counsel of pet i t ioner Jo:;t interest in pursuing his case, which conclusion is bolstered by tl1 � fact thJt apart fmm !:Iiii�: to 1u?0

DECISION- CTA CASE NO. 5594 PAGE4 formally offer evidence, he has incurred absences from the schcclulccl tri�ls mel llso c!id not bother to submit a memorandum. It is a basic rule that a court sldl con;;idcr r:o evidence which has not been formally offered (Section 35 of Rule 35 of l;,..;. l\.uks or Court) and non-compliance with this rule proves fatal to the instant claim. The Supr�:mc Court has categorically declared that a "claimant has the burden of proof to c:;t;:LJI d1 the factual basis of his or her claim for tax credit or refund (Citibani(, N.A. Ys. Ccu;�t o!' Appeals and Commissioner of Internal Revenue, 280 SCRA 459). Failing this. the conclusion of denial is inevitable. It is to be noted that after this case was deemed submitlcd for decision un J\ugust 12, 1999 and was currently being studied by this Court, petitioner belatedly filed a Motion for Leave of Court to Admit Formal Offer of Evidence. This Coui�: d:.:nicd thi:.; Motion in a resolution dated September 24, 1999, citing as a primary re<.son the i:ilurc of petitioner's counsel to avail of the opportunities given during trial to file the form;d oflcr of evidence despite the lapse of considerate length of time which can be largely llt;ibutccl to negligence. We cite the recent case of Citytrust Realty Corp. vs. Ci l, CA C.H.. p 36487, May 31, 2000 affirming our decision in CTA Case No. 4727 in support or thi:-; stand. Despitertbis denial, Petitioner subsequently filed an Omnibus Motion Cor Leave of Court to Reopen Trial to Present Additional Evidence and to Avail of the J>roccl!urc on the Presentation of Voluminous Documents Under CTA Circular No. I -95, as amcnclcd by CTA Circular No. 10-97. This Omnibus Motion was denied in a Resolution d<tccl February 29, 2000. From this denial, Petitioner persistently filed another .Motion for Reconsideration on March 21, 2000 which was again clc:Jicd in a Resolution dated May 31, 2000. To put a stop to the .�''"'llingly en�'' --;s f'�f(':;,ns Cur lu'?'

DECISION- CTA CASE NO. 5594 PAGES Reconsideration being filed by Petitioner, the Court resolved to consider the cJsc submitted for decision as of June 16, 2000. In sum, no evidence was deemed presented by the Petitioner in the instant case hence we have no choice but to deny the claim for refund. WHEREFORE, in view of the foregoing, the instant petition lor review is hereby DENIED for lack of evidence. SO ORDERED. L ()). c/:.._ ERNESTO D. ACOT:\ P residing J udGc yi WE CONC : ,..: d. /RAMO DE I YRA / Associate age I I CERTIFICATION I hereby certify that the above decisibn was reached after clue consull1!ioa with the members of the Court of Tax Appeals in accordance \Vilh Scctiun 13, Article VIII of the Constitution. r� ) R- , -,. - ERNESTO D. ACO:�i'l'A Prcsidin::; Judge lOciO