CARMEN COPPER CORPORATION v. COMMISSIONER OF INTERNAL REVENUE

REPUBLrC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY ENBANC ************ CARMEN COPPER CTA EB No. 1124 CORPORATION, (CTA Case No.8042) Pet it ioner , Present: - versus - DEL ROSARIO, PJ, CASTANEDA, JR., BAUTISTA, UY, CASANOVA, FABON-VICTORINO, MINDARO-GRULLA, COTANGCO-MANALASTAS, and RINGPIS-LIBAN, JJ. COMMISSIONER OF Promulgated: INTERNAL REVENUE, Respondent. JUL 3 Q 2015 ,~ .' P'<J/' ~ . x------------------------- --- - - - -- -------------- x DECISION UY,..J_.: This Petition for Review1 filed on February 24, 2014, seeks to annul and set aside the Decision (should be Resolution) dated November 21 , 2013,2 and the Resolution dated February 5,JI't 1 Docket, pp. 1 to 18. 2 Penned by Associate Justice Esperanza R. Fabon-Victorino, Senior Member of the Third Division, concurred by Associate Justice Lovell R. Bautista, Chairperson, while Associate Justice Ma. Belen M. Ringpis-Liban, Junior Member, was on leave when this Resolution was promulgated, Docket, pp. 20 to 33 (Note that in the instant Petition for Review, petitioner erroneously refers to the assailed Resolution dated November 21 , 2013 as the "Decision dated 2I November 2013 " or the "Assailed Decision " issued by the Court in Division).

DECISION CTAEBNo. 1124 Page 2 of26 2014,3 both promulgated by the Third Division of this Court (or Court in Division) in CTA Case No. 8042, entitled ucarmen Copper Corporation, Petitioner, vs. Commissioner of Internal Revenue, Respondent", the dispositive portions of which respectively read: Resolution dated November 21, 2013: "WHEREFORE, the Motion to Dismiss dated September 23, 2013, filed by respondent Commissioner of Internal Revenue, is hereby GRANTED. Consequently, the instant Petition for Review filed by petitioner Carmen Copper Corporation on March 26, 2010, is hereby DISMISSED. In view of the foregoing, the Omnibus Motion [To Admit Exhibits and Reopen the Case] dated July 8, 2013 and Supplemental Offer of Evidence dated September 9, 2013 are now MOOT. SO ORDERED". Resolution dated February 5, 2014: "WHEREFORE, the Motion for Reconsideration filed by petitioner on December 13, 2014 is hereby DENIED, for lack of merit. SO ORDERED". THE FACTS Petitioner Carmen Copper Corporation is a corporation duly organized and existing under the laws of the Republic of the Philippines with Securities and Exchange Commission Registration No. CS200414509,4 engaged in the business of mining ores and other mineral resources, as indicated in the ~ 3 Penned by Associate Justice Esperanza R. Fabon-Victorino, Senior Member of the Third Division, concurred by Associate Justice Lovell R. Bautista, Chairperson, and Associate Justice Ma. Belen M. Ringpis-Liban, Junior Member, Docket, pp. 34 to 41. 4 Par. 3, Joint Stipulation of Facts and Issues (JSFI), Division Docket (CTA Case No. 8042)- Vol. II, p. 925.

DECISION CTAEBNo. 1124 Page 3 of26 primary purpose clause of its Articles of lncorporation.5 It is a duly registered value-added tax (VAT) enterprise, pursuant to Section 236 of the Tax Code, having been issued Certificate of Registration No. 3RC0000281745 dated April21, 2005, with VAT being among its registered tax types.6 It is likewise registered with the Board of Investments (801), pursuant to Executive Order No. 226, otherwise known as the Omnibus Investment Code of 1987, as a new producer of copper concentrate with non-pioneer status.7 On the other hand, respondent Commissioner of Internal Revenue is a public officer duly appointed by the President of the Republic of the Philippines, and is the head of the Bureau of Internal Revenue (BIR), the government agency officially responsible for the assessment and collection of all national and internal revenue taxes. She is vested with the power and authority to refund any internal revenue tax 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 excessively or in any manner wrongfully collected or of input VAT attributable to zero-rated sales. 8 On the dates indicated below, petitioner filed with the BIR's Revenue District Office No. 41 (Mandaluyong) administrative claims for refund of its input VAT payments for the third and fourth quarters of 2007, and all four (4) quarters of 2008: 9 Date of filing of Amount of accumulated input Period administrative VAT credits covered by claim claim for refund (Php) [based on amended returns] 2007 3rd Qtr 19 December 2008 Iii 22,598,927.36 4m Qtr 19 December 2008 35,166,841.68 2008 1st Qtr 9 February 2009 18,159,371.92 ' 2ndatr 11 March 2009 17,043,298.46 3ra Qtr 11 March 2009 74,330, 739.60 4tn Qtr 11 March 2009 288,204,659.28 Total Jil 455,503,838.30 �~ 5 Par. 4, JSFI, Division Docket (CTA Case No. 8042)- Vol. II, p. 925. 6 Par. 5, JSFI, Division Docket (CTA Case No. 8042)- Vol. II, p. 925. 7 Par. 6, JSFI, Division Docket (CTA Case No. 8042)- Vol. II, p. 925. 8 Par. 1, JSFI, Division Docket (CTA Case No. 8042)- Vol. II, pp. 924 to 925. 9 Par. 2, JSFI, Division Docket (CTA Case No. 8042)- Vol. II, p. 925.

DECISION CTA EB No. 1124 Page 4 of26 Upon the belief that the two-year statutory period within which to file a claim for refund of the above-stated input VAT payments is about to lapse and considering that its claim for refund with the above-mentioned BIR office remains unresolved, petitioner filed its Petition for Review on March 26, 2010. 10 The case was docketed as CTA Case No. 8042 and was raffled to the First Division of this Court. On May 21, 2010, respondent filed her Answer in CTA Case No. 8043, 11 raising, among others, the following special and affirmative defenses, to wit: petitioner's claim for tax refund is subject to administrative investigation/examination by respondent's Bureau. Moreover, in order to validly claim for tax refund, it is imperative for petitioner to prove its compliance with legal requirements, such as registration requirements of a value- added taxpayer under the pertinent provision of the 1997 NIRC, as amended, and its implementing revenue regulations; the invoicing and accounting requirements for VAT-registered persons, as well as the filing and payment of VAT pursuant to the provisions of Sections 113 and 114 of the 1997 NIRC, as amended; the submission of complete documents in support of the administrative claim for tax refund pursuant to Section 112 (C) of the 1997 NIRC, as amended, otherwise, there would be no sufficient compliance with regard to the filing of administrative claim for tax refund which is a condition sine qua non prior to the filing of such claim. On July 23, 2010 12 the parties filed their Joint Stipulation of , Facts and Issues (JSFI) in CTA Case No. 8042, as directed by the First Division of this Court during the Pre-Trial Conference 13 held on July 9, 2010 . The JSFI was approved in the Resolution dated July 28, 2010. 14 During trial, petitioner presented the following witnesses: Fernando Rimando; ICPA Emmanuel Mendoza; Jesus C. Caparida. On February 7, 2013, petitioner filed its Formal Offer of Eitidence15 and the same was resolved in the Resolution dated~ 10 Par. 12, Petition for Review (CTA Case No. 8042), Division Docket (CTA Case No. 8042)- Vol. I, p. 10. 11 Division Docket (CTA Case No. 8042)- Vol. I, pp. 884 to 888. 12 Division Docket (CTA Case No. 8042)- Vol. II, pp. 924 to 927. 13 July 9, 2010 Minutes of Hearing, Division Docket (CTA Case No. 8042)- Vol. II, p. 922. 14 Division Docket (CTA Case No. 8042)- Vol. II, p. 929. 15 Division Docket (CTA Case No. 8042)- Vol. IV, pp. 1746 to 1786.

DECISION CTA EB No. 1124 Page 5 of26 March 22, 2013. 16 Meanwhile, in the Order dated April 8, 201317, CTA Case No. 8042 was transferred to the Third Division of this Court pursuant to CTA Administrative Circular No. 01-2013 "Reorganizing the Three (3) Divisions of the Court of Tax Appeals" dated March 26, 2013. On September 23, 2014, respondent filed a "Motion to Dismiss, 18 on the ground of lack of jurisdiction of the Court in Division due to petitioner's belated filing of its judicial claim for refund. Petitioner filed its Opposition (to the Motion to Dismiss dated September 18, 2013) on October 21, 2013. 19 In the assailed Resolution dated November 21, 2013,20 the Court in Division granted respondent's Motion to Dismiss, and accordingly, dismissed the Petition for Review for CTA Case No. 8042. Petitioner filed its Motion for Reconsideration (of the Resolution dated November 21, 2013) on December 13, 2013, 21 praying for the continuation of the trial. Pursuant to the Resolution dated January 14, 2014 of the Court in Division22 , respondent filed her Comment on January 20, 2014.23 In the assailed Resolution dated February 5, 2014, the Court in Division denied petitioner's Motion for Reconsideration On February 24, 2014, petitioner filed the instant Petition for Review before the Court En Bane, seeking to annul and set aside the Court in Division's Assailed Decision (referring to the Resolution dated November 21, 2013) and Resolution dated February 5, 2014, and to proceed with the hearing of the case on the merits. The Court En Bane directed respondent to file her Comment, not a motion to dismiss, in the Resolution dated;.. 16 Division Docket (CTA Case No. 8042)- Vol. IV, pp. 2376 to 2377. 17 Division Docket (CTA Case No. 8042)- Vol. V, p. 2378. 18 Division Docket (CTA Case No. 8042)- Vol. V, pp. 2564 to 2570. 19 Division Docket (CTA Case No. 8042)- Vol. V, pp. 2575 to 2588. 20 Division Docket (CTA Case No. 8042)- Vol. V, pp. 2597 to 2610. 21 Division Docket (CTA Case No. 8042)- Vol. V, pp. 2611 to 2618. 22 Division Docket (CTA Case No. 8042)- Vol. V, p. 2635. 23 Division Docket (CTA Case No. 8042)- Vol. V, pp. 2636 to 2640.

DECISION CTA EB No. 1124 Page 6 of26 March 20, 2014,24 within ten (10) days from receipt thereof. On April 2, 2014, respondent filed her Comment25; while on April 14, 2014, petitioner filed its Reply (to the Comment dated April 2, 2014). In the Resolution dated May 2, 2014, the Court En Bane gave due course to the instant Petition for Review, and ordered parties to submit their res~ective memorandum within thirty (30) days from receipt thereof. 6 Respondent filed her Memorandum on June 3, 2014.27 On the other hand, petitioner filed its Memorandum within the extension period of thirty (30) days granted by the Court En Bane on July 14, 201428. Thus, the instant case was deemed submitted for decision on August 7, 2014. 29 Hence, this Decision. THE ISSUE Petitioner raises this lone issue, to wit: "whether the Petitioner timely filed its judicial claim for a refund or the issuance of a tax credit certificate for its unutilized input VAT for the 3rd and 4th quarters of 2007 and all four (4) quarters of 2008 in the total amount of Iii 455,503,838.30."30 Petitioner's Arguments Petitioner argues that the 120+30-day period provided under Section 112(C) of the Tax Code was not mandatory or jurisdictional at the time its judicial claim was filed. According to petitioner, Section 112(C) has been part of the Tax Code since its effectivity in January 1, 1998 and yet, this Court, both in Division and En Bane, has ruled that the 120+30 day period provided under the said Section 112(C) is neither mandatory nor jurisdictional in its various decisions on VAT claims for refund. {' 24 Docket, pp. 43 to 44. 25 Docket, pp. 45 to 49. 26 Docket, pp. 51 to 52. 27 Docket, pp. 72 to 80. 28 Docket, pp. 89 to 112. 29 Resolution dated August 7, 2014, Docket, p. 115. 30 Petition for Review, Docket, p. 5. See also respondent's Memorandum and petitioner's Memorandum, Docket, pp. 74 and 93, respectively.

DECISION CTAEBNo. 1124 Page 7 of26 Petitioner adds that the rule that "rulings of the Court of Appeals may serve as precedents for lower courts, they only apply to points of law not covered by any Supreme Court decision'i3 should likewise be applicable to this Court, especially with respect to tax cases, since this Honorable Court is also an appellate court equal in rank to the Court of Appeals with special jurisdiction over tax cases. 32 Petitioner further points out that the Supreme Court's consistent disregard of the 120+30-day period in its decisions on VAT refund cases which were prevailing at the time of the filing of the Petition for Review, further emphasizes that the then prevailing interpretation of Section 112(C}, as amended, was that the 120+30-day period provided therein is neither mandatory nor jurisdictional. This interpretation should allegedly apply to this Petition for Review. As regards the timeliness of its judicial claim for the four (4) quarters of taxable year 2008, petitioner contends that the same was timely filed pursuant to BIR Ruling DA-489-03 dated December 10, 2003. Petitioner further asserts that the cases of Commissioner of Internal Revenue vs. Aichi Forging Company of Asia, Inc. (or "Aichi case")33 and Commissioner of Internal Revenue vs. San Roque Power Corporation, etseq. (or "San Roque case")34 should not be made to apply to the instant case because these were all decided and became final almost three (3) years after the present judicial claim was filed. Furthermore, according to petitioner, the said cases are not applicable because they should be applied prospectively and not to parties who relied on the old doctrine in good faith. Lastly, petitioner asserts that even assuming that the 120+30 day period rule applies, its judicial claims for the four (4) quarters of taxable year 2008 were timely filed in accordance with the case of Commissioner of Internal Revenue vs. Mindanao II Geothermal Partnership (or "Mindanao II case")35 in relation to BIR Ruling DA-489-03 dated December 10, 2003. Relative thereto, petitioner alleges that respondent neither informed nor followed up with petitioner regarding its documents in support of its administrative claims for all quarters of taxable year 2008,f\ 31 Government Service Insurance System vs. Cadiz, G.R. No. 154093, July 8, 2003. 32 Republic Act No. 9282. 33 G.R. No. 184823, October 6, 2010. 34 G.R. Nos. 187485, 196113, and 197156, February 12,2013. 35 G.R. No. 191498, January 15,2014.

DECISION CTAEBNo. 1124 Page 8 of26 Thus, considering that respondent did not clarify whether petitioner's documentary evidence for the administrative claim was sufficient and complete, petitioner could not reckon the proper beginning of the 120-day period within which respondent should have decided on its claim for refund. Considering therefore that its judicial claims were allegedly "premature" for having been filed on March 26, 2010, well within the period between December 10, 2003 and October 5, 2010, when BIR Ruling No. DA-489-03 was still in force and before the Aichi case was promulgated, the said judicial claims were timely filed in accordance with the Mindanao II case and the San Roque case. Respondent's Counter-arguments Respondent counters that petitioner's judicial claim for tax credit/refund with this Court was filed out of time because based on Section 112(C) of National Internal Revenue Code (NIRC) of 1997, as amended, it is clear that compliance with the 120+30- day periods is not merely discretionary, but is rather mandatory and jurisdictional. Respondent points out that in this case, it took petitioner several months to file its Petition for Review with this Court, way beyond the 30-day appeal period provided by Section 112(C) of the NIRC of 1997, as amended. Hence, this Court was already divested of any jurisdiction to decide petitioner's Petition for Review as it was belatedly filed on March 26, 2010. THE COURT EN BANC'S RULING The Court a quo correctly dismissed the Petition for Review filed in CTA Case No. 8042 for lack of jurisdiction as the same was filed beyond the thirty-day period under Section 112(C) of the NIRC of 1997, as amended by Republic Act No. (RA) 933736. The governing law on the refund or issuance of tax credit of~ 36 AN ACT AMENDING SECTIONS 27, 28, 34, 106, 107, 108, 109, 110, 111, 112, 113, 114, 116, 117, 119, 121, 148, 151, 236, 237 AND 288 OF THE NATIONAL INTERNAL REVENUE CODE OF 1997, AS AMENDED, AND FOR OTHER PURPOSES.

DECISION CTA EB No. 1124 Page 9 of26 input VAT is Section 112 of the NIRC of 1997, as amended by RA 9337, the pertinent provisions of which read as follows: SEC. 112. Refunds or Tax Credits of Input Tax.- (A) Zero-rated or Effectively Zero-rated Sales. - Any VAT-registered person, whose sales are zero- rated or effectively zero-rated may, within two (2) years after the close of the taxable quarter when the sales were made, apply for the issuance of a tax credit certificate or refund of creditable input tax due or paid attributable to such sales, except transitional input tax, to the extent that such input tax has not been applied against output tax: xxx XXX XXX XXX (C) Period within which Refund or Tax Credit of Input Taxes shall be Made. - In proper cases, the Commissioner shall grant a refund or issue the tax credit certificate for creditable input taxes within one hundred twenty (120) days from the date of submission of complete documents in support of the application filed in accordance with Subsection (A) hereof. In case of full or partial denial of the claim for tax refund or tax credit, or the failure on the part of the Commissioner to act on the application within the period prescribed above, the taxpayer affected may, within thirty (30) days from the receipt of the decision denying the claim or after the expiration of the one hundred twenty-day period, appeal the decision or the unacted claim with the Court of Tax Appeals. XXX XXX xxx. (Emphasis supplied) Based on the foregoing provisions, a VAT-registered person may file an administrative claim before the Commissioner of Internal Revenue for the issuance of a tax credit certificate or refund of creditable input tax attributable to zero-rated or effectively zero-rated sales within two (2) years after the close of taxable quarter when the sales were made. ~

DECISION CTA EB No. 1124 Page 10 of26 Likewise, under paragraph (C) thereof, the Commissioner of Internal Revenue (CIR) is given a 120-day period, from submission of complete documents in support of an administrative claim for refund/application for issuance of the tax credit certificate within which to act upon said claims. Upon denial of the claim or application, or upon expiration of the 120-day period without any action on the claim, the taxpayer has a 30-day period only within which to appeal said adverse decision or unacted claim before the CTA. Clearly therefore, Section 112(C) of the NIRC of 1997, as amended, provides for a 120-day period for the CIR to act on administrative claims for refund/applications for issuance of tax credit certificates, from submission of complete supporting documents, as well as a 30-day period for the taxpayer to seek judicial recourse with the Court of Tax Appeals, on two (2) instances : (1) upon partial or full denial of its refund claim; or (2) upon the inaction of the CIR for a period of 120 days from the submission of complete documents in support of its refund claim. The 120+30-day periods under Section 112(C) is mandatory and jurisdictional. The proper interpretation of the above-quoted prov1s1on was finally settled by the Supreme Court sitting En Bane in the San Roque case cited by petitioner promulgated on February 12, 2013. The relevant portions of the discussion pertinent to the focal issue in the present case are quoted hereunder as follows: "To repeat, a claim for tax refund or credit, like a claim for tax refund exemption, is construed strictly against the taxpayer. One of the conditions for a judicial claim for refund or credit under the VAT System is compliance with the 120+30 day mandatory and jurisdictional periods. Thus, strict compliance with the 120+30 periods is necessary for such a claim to prosper, whether before, during, or after the effectivity of the Atlas doctrine, except for the period from the issuance of BIR Ruling No. DA-489-03 on 10 December 2003 to 6 October 2010 when the Aichi doctrine was adopted, which again reinstated the 120+30 day periods as mandatory and jurisdictional."~

DECISION CTA EB No. 1124 Page 11 of26 (Emphasis supplied)37 In the subsequent case of Mindanao II Geothermal Partnership vs. Commissioner of Internal Revenue, 38 the Second Division of the Supreme Court, applied the ruling in the San Roque case, and provided a Summary of Rules on Prescriptive Periods Involving VAT as a guide for all parties concerned, to wit: "We summarize the rules on the determination of the prescriptive period for filing a tax refund or credit of unutilized input VAT as provided in Section 112 of the 1997 Tax Code, as follows: (1) An administrative claim must be filed with the CIR within two years after the close of the taxable quarter when the zero-rated or effectively zero-rated sales were made. (2) The CIR has 120 days from the date of submission of complete documents in support of the administrative claim within which to decide whether to grant a refund or issue a tax credit certificate. The 120-day period may extend beyond the two-year period from the filing of the administrative claim if the claim is filed in the later part of the two-year period. If the 120-day period expires without any decision from the CIR, then the administrative claim may be considered to be denied by inaction. (3) A judicial claim must be filed with the CTA within 30 days from the receipt of the CIR's decision denying the administrative claim or from the expiration of the 120-day period without any action from the CIR. (4) All taxpayers, however, can rely on BIR Ruling No. DA-489-03 from the time of its issuance r� on 10 December 2003 up to its reversal by this Court in Aichi on 6 October 2010, as an exception to the mandatory and jurisdictional 120+30 day periods., 37 Commissioner of Internal Revenue vs. San Roque Power Corporation, etseq., G.R. Nos. 187485, 196113, and 197156, February 12,2013. 38 Mindanao II Geothermal Partnership vs. Commissioner of Internal Revenue, G.R. Nos. 193301 and 194637, March 11,2013.

DECISION CTA EB No. 1124 Page 12 of26 Certainly, it is evident from the foregoing jurisprudential pronouncements that a taxpayer-claimant only had a limited period of thirty (30) days from the expiration of the 120-day period of inaction of the Commissioner of Internal Revenue (CIR) to file its judicial claim with this Court, with the exception of premature claims made during the effectivity of BIR Ruling No. DA-489-0339 (from 10 December 2003 to 5 October 201 0). Failure to do so, the judicial claim shall prescribe as filed out of time.40 At this juncture, it is worthy to note that while petitioner is well aware of the foregoing ruling in the San Roque case, it nevertheless basically argues against the inapplicability of the 120+30-day periods to its judicial claim because allegedly, the reckoning of the 120 day period was unclear, as respondent did not communicate with petitioner regarding its supporting documents for its administrative refund claims for all quarters of taxable year 2008. Hence, according to petitioner, it could not reckon the proper start of the 120-day period within which respondent should decide its claim for refund. We do not agree with petitioner's line of argument. When petitioner filed its administrative claim for refund with respondent CIR, it is presumed that it included in the said application its complete supporting documents, and therefore the 120 day period began to run on the date of the filing of its administrative refund claim. Bearing in mind that the burden to prove entitlement to a tax refund is on the taxpayer, it is presumed that in order to discharge its burden, petitioner had attached complete supporting documents necessary to prove its entitlement to a refund in its application, absent any evidence to the contrary. 4~ 39 According to the San Roque case, "BIR Ruling No. DA-489-03 does provide a valid claim for valid equitable estoppel under Section 246 of the Tax Code. BIR Ruling No. DA-489-03 expressly states that the 'taxpayer-claimant need not wait for the lapse of the 120-day period before it could seek judicial relief with the CTA by way of Petition for Review.'" 40 Miramar Fish Company, Inc. vs. Commissioner of Internal Revenue, G.R. No. 185432, June 4, 2014. 41 CBK Power Company Limited vs. Commissioner of Internal Revenue G.R. Nos. 198729-30, January 15, 2014.

DECISION CTA EB No. 1124 Page 13 of26 In view of this presumption, respondent's 120-day period to decide petitioner's administrative claim commenced to run from the date of filing said administrative claims. We summarize the significant dates in the instant case, as follows: PERIOD DATE OF FILING OF LAPSE OF LAPSE OF OF REFUND ADMINISTRATIVE 120-DAY 30-DAY CLAIM PERIOD PERIOD CLAIM December 19, 2008 April18, May 18, 3ra Quarter 2009 2009 December 19, 2008 April18, May 18, of 2007 .. 2009 2009 4m Quarter June 9, February 9, 2009 2009 July 9, 2009 of2007 1st Quarter of March 11 , 2009 July 9, 2009 August 8, 2009 2008 March 11 , 2009 July 9, 2009 2"0 Quarter of August 8, March 11 , 2009 July 9, 2009 2009 2008 3ra Quarter of August 8, 2009 2008 4tn Quarter of 2008 Notably, and as mentioned earlier, the Petition for Review in CTA Case No. 8042 was filed only on March 26, 201 0 before the Court in Division, which is clearly beyond the 30-day periods indicated above. Hence, petitioner's judicial recourse before this Court was filed out of time and the dismissal was therefore proper on the ground of lack of jurisdiction. The decisions of this Court do not constitute binding precedents. Petitioner invokes certain previous rulings of this Court regarding the non-mandatory and non-jurisdictional nature of the 120+30-day period, to justify its non-compliance with the same. Such stance must fail. As held in the San Roque case, the Supreme Court said: "There is also the claim that there are numerous CTA decisions allegedly supporting the argument that the filing dates of the administrative and judicial claims are inconsequential, as long as they are within the two-year prescriptive period. Suffice it to state~

DECISION CTAEBNo. 1124 Page 14 of26 that CTA decisions do not constitute precedents, and do not bind this Court or the public. That is why CTA decisions are appealable to this Court, which may affirm, reverse or modify the CTA decisions as the facts and the law may warrant. Only decisions of this Court constitute binding precedents, forming part of the Philippine legal system."42 (Emphases supplied) The Supreme Court decisions invoked by petitioner are not applicable to the instant case. Petitioner likewise presents the argument that at the time petitioner filed its Petition for Review (i.e., on March 26, 2010), there was no categorical ruling by the Supreme Court on the nature of the 120+30-day period provided under Section 112(C) of the NIRC of 1997, as amended by RA 9337. According to petitioner, although there was no such categorical ruling, the Supreme Court consistently disregarded the said 120+30-day period, in deciding VAT refund cases, such as the following: (1) Philippine Geothermal, Inc. vs. Commissioner of Internal Revenue (or "Philippine Geothermal case")43; (2) Intel Technology Philippines, Inc. vs. Commissioner of Internal Revenue44; (3) San Roque Power Corporation vs. Commissioner of Internal Revenue (or the "2009 San Roque case")45; (4) Commissioner of Internal Revenue vs. lroncon Builders and Development Corporation46; and (5)Silicon Philippines, Inc. vs. Commissioner of Internal Revenue (or "Silicon case")47. Petitioner thus contends that the consistent disregard of the 120+30-day period was because such period is neither ~ mandatory nor jurisdictional. 42 Refer also to Nippon Express (Philippines) Corporation vs. Commissioner of Internal Revenue, G.R. No. 196907, March 13, 2013. 43 G.R. No. 154028, July 29, 2005. 44 G.R. No. 166732, April27, 2007. 45 G.R. No. 180345, November 25, 2009. 46 G.R. No. 180042, February 8, 2010. 47 G.R. No. 172378, January 17, 2011.

DECISION CTA EB No. 1124 Page 15 of26 We find petitioner's reliance on the aforecited Supreme Court cases misplaced based on the following considerations: 1) In the Philippine Geothermal case, it is very clear that "the only issue is the amount of refund to be granted based on the amount of tax erroneously paid." Similar to the cases addressed in the San Roque case, nowhere in the Philippine Geothermal case did �the Supreme Court discuss, state or rule that the filing dates of the administrative and judicial claims are inconsequential, as long as they are within the two-year prescriptive period. While the Supreme Court stated in the narration of facts in the Philippine Geothermal case that "(s)ince respondent failed to act on the claim, on July 2, 1997, petitioner filed a petition to toll the running of the two-year prescriptive period before the Court of Tax Appeals", this issue was not raised therein. In accordance with the San Roque case, said statement in the Philippine Geothermal case is not a binding precedent that the taxpayer need not observe the 120+30-day prescriptive period under the law. 2) In Intel Technology Philippines, Inc. v. CIR, the Supreme Court stated: "The issues to be resolved in the instant case are (1) whether the absence of the BIR authority to print or the absence of the TIN-V in petitioner's export sales invoices operates to forfeit its entitlement to a tax refund/credit of its unutilized input VAT attributable to its zero-rated sales; and (2) whether petitioner's failure to indicate 'TIN-V' in its sales invoices automatically invalidates its claim for a tax credit certification." Again, nowhere in this case did the Supreme Court discuss, state, or rule that the filing dates of the administrative and judicial claims are inconsequential. as long as they are within the two- year prescriptive period.48 3) In the 2009 San Roque case, it is likewise very clear that "the main issue in this case is whether or not petitioner may claim a tax refund or credit in the amount of fii 249,397,620.17 for creditable input tax attributable to zero-rated or effectively zero- rated sales pursuant to Section 112(A) of the NIRC or for input taxes paid on capital goods as provided under Section 112(8) of the NIRC." Again, nowhere in said case did the Supreme Court discuss, state, or rule that the filing dates of the administrative r and judicial claims are inconsequential, as long as they are within the two-year prescriptive period. And while it is found as a fact in the 2009 San Roque case that "(r)espondent failed to act on the 48 See Commissioner ofInternal Revenue vs. San Roque Power Corporation, etseq., G.R. Nos. 187485, 196113, and 197156, February 12,2013 (Decision, p. 41).

DECISION CTA EB No. 1124 Page 16 of26 request for tax refund or credit of petitioner, which prompted the latter to file on 5 April 2004, with the CTA in Division, a Petition for Review, docketed as CTA Case No. 6916 before it could be barred by the two-year prescriptive period within which to file its claim", it was not raised as an issue therein whether the taxpayer need not wait for the 120+30-day period prescribed under Section 112(0) of the NIRC of 1997. Thus, the 2009 San Roque case cannot be treated as a binding precedent insofar as the non-observance of the 120+30-day prescriptive period is concerned. 4) In C/R v. lroncon Builders and Development Corporation, the Supreme Court puts the issue in this manner: "Simply put, the sole issue the petition raises is whether or not the CTA erred in granting respondent lroncon's application for refund of its excess creditable VAT withheld." The Commissioner argued that "since the NIRC does not specifically grant taxpayers the option to refund excess creditable VAT withheld, it follows that such refund cannot be allowed." Thus, this case is solely about whether the taxpayer has the right under the NIRC to ask for a cash refund of excess creditable VAT withheld. Again. nowhere in this case did the Supreme Court discuss, state. or rule that the filing dates of the administrative and judicial claims are inconsequential. as long as they are within the two-year prescriptive period.49 5) In the Silicon case, the issues are clear-cut, to wit: "(1) whether the CTA En Bane erred in denying petitioner's claim for credit/refund of input VAT attributable to its zero-rated sales in the amount of fiii 16,732,425.00 due to its failure: (a) to show that it secured an ATP from the BIR and to indicate the same in its export sales invoices; and (b) to print the word 'zero-rated' in its export sales invoices. (2) whether the CTA En Bane erred in ruling that only the amount of fiii 9, 898, 867. 00 can be classified as input VAT paid on capital goods." Likewise, nowhere in this case did the Supreme Court discuss, state, or rule that the filing dates of the administrative and judicial claims are inconsequential, as long as they are within the two-year prescriptive period. While We concede that~ 49 See Commissioner ofInternal Revenue vs. San Roque Power Corporation, etseq., G.R. Nos. 187485, 196113, and 197156, February 12,2013 (Decision, p. 42).

DECISION CTA EB No. 1124 Page 17 of26 the petitioner in the Silicon case glaringly did not observe the 120+30-day prescriptive period under the law, the same was not passed upon as an issue therein. Thus, the Silicon case does not constitute a binding precedent on the nature of the said 120+30-day prescriptive period. Additionally, petitioner invokes the ruling of the Supreme Court in the case of Atlas Consolidated Mining and Development Corporation vs. Commissioner of Internal Revenue (or "Atlas case")50 that the two-year prescriptive period for the filing of both the administrative and judicial claims for refund of excess and unutilized input VAT should be reckoned from the date of filing of the quarterly VAT return. Petitioner is in error. It must be emphasized that the doctrine laid down in the Atlas case only pertains to the reckoning point of the two (2)-year prescriptive period under Section 229 of the NIRC of 1997, which was held to be from the date of payment of the output VAT, but has no relevance to the 120+30 day period under Section 112 of the NIRC of 1997. As held in the San Roque case: "The At/as doctrine, which held that claims for refund or credit of input VAT must comply with the two-year prescriptive period under Section 229, should be effective only from its promulgation on 8 June 2007 until its abandonment on 12 September 2008 in Mirant. The At/as doctrine was limited to the reckoning of the two-year prescriptive period from the date of payment of the output VAT. Prior to the At/as doctrine, the two-year prescriptive period for claiming refund or credit of input VAT should be governed by Section 112(A) following the verba legis rule. The Mirant ruling, which abandoned the Atlas doctrine, adopted the verba legis rule, thus applying Section 112(A) in computing the two-year prescriptive period in claiming refund or credit of input VAT. The Atlas doctrine has no relevance to the 120+30 day periods under Section 112(C) because the application of the 120+30 day periods was not in ~ 50 G.R. Nos. 141104 and 148763, June 8, 2007.

DECISION CTA EB No. 1124 Page 18 of26 issue in Atlas. The application of the 120+30 day periods was first raised in Aichi. which adopted the verba legis rule in holding that the 120+30 day periods are mandatory and jurisdictional. (Underscoring supp/ied/1 In relation to the foregoing disquisition, the Supreme Court, in Visayas Geothermal Power Company vs. Commissioner of Internal Revenue (hereinafter referred to as the "Visayas Geothermal case"), 2 said: 5 "Thus, Atlas case is only relevant in determining when to file an administrative claim with the CIR for refund or credit of unutilized creditable input VAT, and not for determining when to file a judicial claim with the CTA. From June 8, 200753 to September 12, 200854, the 2-year prescriptive period to file administrative claims should be counted from the date of payment of the output VAT tax. Before and after said period, the 2-year prescriptive period is counted from the close of the taxable quarter when the sales were made, in accordance with Section 112(A): In either case, the mandatory and jurisdictional 120+30 day period must be complied with for the filing of the judicial claim with the CTA, except for the period provided under BIR Ruling No. DA-489-03, as previously discussed. The Court further noted that Atlas was decided in relation to the 1977 Tax Code which had not yet provided for the 30-day period for the taxpayer to appeal to the CTA from the decision or inaction of the CIR over claims for unutilized input VAT. Clearly then, the Atlas doctrine cannot be invoked to disregard compliance with the 120+30 day mandatory and jurisdictional period. xxx." (Emphases supplied) Parenthetically, even granting that the Atlas case is~ 51 See Note No. 38. 52 G.R. No. 197525, June 4, 2014. 53 The date of promulgation of the Atlas case. 54 The date of promulgation of the case of Commissioner of Internal Revenue vs. Mirant Pagbilao Corporation, wherein the doctrine laid down in the Atlas case was abandoned.

DECISION CTA EB No. 1124 Page 19 of26 relevant to the present case, it could not be applied since it was held to be effective only from its promulgation on June 8, 2007 until its abandonment on September 12, 2008 when the case of Commissioner of Internal Revenue vs. Mirant Pagbilao Corporation55 was promulgated. In this connection, it must be noted that petitioner filed both its administrative and judicial claims after the said period of effectivity. The application of the San Roque case (2013) in the instant case Petitioner argues that the San Roque case (2013) should be applied prospectively. According to petitioner, since the San Roque case did not provide for a specific retroactive application of the current rules, its present judicial claim should not be prejudiced since the San Roque case was decided and became final almost three (3) years after this present claim. We disagree with petitioner. The said argument has already been addressed by the Supreme Court in the more recent case of San Roque Power Corporation vs. Commissioner of Internal Revenue (or the "2014 San Roque case")56, wherein it was held: "The Court is not persuaded. The aforequoted paragraph should be understood in the context of the entire San Roque (2013l7. The statement of the Court applying Mirant and Aichi prospectively should be understood relative to, and never apart from, At/as and Bl R Ruling No. DA-489-03. The Court explained in San Roque (2013), under the heading 'Effectivity and Scope of the Atlas, Mirant and Aichi Doctrines,' that: The Atlas doctrine, which held that claims for refund or credit of input VAT must comply with the two-year _____p_r_e_s_c_ri_p-ti-ve period under Section 229,1' 55 G.R. No. 172129, September 12, 2008. 56 G.R. No. 205543, June 30, 2014. 57 Referring to the San Roque case.

DECISION CTAEBNo. 1124 Page 20 of26 should be effective only from its promulgation on 8 June 2007 until its abandonment on 12 September 2008 in Mirant. The Atlas doctrine was limited to the reckoning of the two-year prescriptive period from the date of payment of the output VAT. Prior to the Atlas doctrine, the two-year prescriptive period for claiming refund or credit of input VAT should be governed by Section 112(A) following the verba legis rule. The Mirant ruling, which abandoned the Atlas doctrine, adopted the verba legis rule, thus applying Section 112(A) in computing the two-year prescriptive period in claiming refund or credit of input VAT. The Atlas doctrine has no relevance to the 120+30 day periods under Section 112(C) because the application of the 120+30 day periods was not in issue in Atlas. The application of the 120+30 day periods was first raised in Aichi, which adopted the verba legis rule in holding that the 120+30 day periods are mandatory and jurisdictional. x x x. xxxx To repeat, a claim for tax refund or credit, like a claim for tax exemption, is construed strictly against the taxpayer. One of the conditions for a judicial claim for refund or credit under the VAT System is compliance with the 120+30 day mandatory and jurisdictional periods. Thus, strict compliance with the 120+30 day periods is necessary for such a claim to prosper, whether before, during, or after the effectivity of the Atlas doctrine, except for the period from the issuance of BIR Ruling No. DA-489-03 on 10 December 2003 to 6 October 2010 when the Aichi doctrine was adopted, which again reinstated the 120+30 day periods as ~

DECISION CTA EB No. 1124 Page 21 of26 mandatory and jurisdictional. (Emphases supplied.) xxxx Based on the foregoing, 'prospective application' of Aichi and Mirant. in the context of San Roque (2013). only meant that the rulings in said cases would not retroactively affect taxpayers who relied on At/as and/or DA-489-03 when they filed their administrative and judicial claims for refund or tax credit of creditable input taxes during the period when At/as and DA-489-03 were still in effect. Aichi and Mirant can still be applied to cases involving administrative and judicial claims filed prior to the promulgation of said cases and outside the period of effectivity of Atlas and DA-489-03, such as the instant case." (Underscoring supplied) Furthermore, in the Visayas Geotherma/58 case, the Supreme Court ruled as follows: "Petitioner VGPC also argues that Aichi should be applied prospectively and, therefore, should not be applied to the present case. This position cannot be given consideration. Article 8 of the Civil Code provides that judicial decisions applying or interpreting the law shall form part of the legal system of the Philippines and shall have the force of law. The interpretation placed upon a law by a competent court establishes the contemporaneous legislative intent of the law. Thus, such interpretation constitutes a part of the law as of the date the statute is enacted. It is only when a prior ruling of the Court is overruled, and a different view adopted, that the new doctrine may have to be applied prospectively in favor of parties who have relied on the old doctrine and have acted in good faith. Considering that the nature of the 120+30 day period was first settled in Aichi, the interpretation by the Court of its being mandatory f and jurisdictional in nature retroacts to the date the NlRC was enacted. It cannot be applied 58 See Note 52.

DECISION CTAEBNo. 1124 Page 22 of26 prospectively as no old doctrine was overturned." (Emphases supplied) BIR Ruling No. DA-489-03 is not applicable to the case of petitioner. Petitioner further argues that when it filed its judicial claims on March 26, 2010, BIR Ruling No. DA-489-03 was still in effect, the prevailing law by way of contemporary judicial interpretation. According to petitioner, at the time its Petition for Review was filed before the Court in Division, the prescriptive period to file a judicial claim was governed by Section 229 of the Tax Code, pursuant to BIR Ruling No. DA-489-03. Furthermore, petitioner alleges that Section 112 was interpreted by the same BIR Ruling No. DA-489-03 to govern only the filing of the administrative claim, and thus, the applicable and prevailing prescriptive period at the time of filing of the Petition for Review, as far as the judicial claim is concerned, is two years from the time of payment, pursuant to Section 229 of the Tax Code. We disagree. In the 2014 San Roque case, the Supreme Court clarified the significance of BIR Ruling No. DA-489-03 in this wise, viz: "It is still necessary for the Court to explain herein how BIR Ruling No. DA-489-03 is an exception to the strict observance of the 120+30 day periods for judicial claims. BIR Ruling No. DA-489-03 affected only the 120-day period as the 81 R held therein that 'a taxpayer-claimant need not wait for the lapse of the 120-day period before it could seek judicial relief with the CTA by way of Petition for Review. Neither is it required that the Commissioner should first act on the claim of a particular taxpayer before the CTA may acquire jurisdiction, particularly if the claim is about to prescribe.' Consequently, BIR Ruling No. DA-489-03 may only be invoked by taxpayers who relied on the same and prematurely filed their judicial claims before the expiration of the 120-day period for the CIR to act on their administrative claims. provided that the taxpayers filed such judicial claims from December 10. 2003 to October 6. 2010. BIR Ruling No. DA-489-03 did notr.

DECISION CTA EB No. 1124 Page 23 of26 touch upon the 30-day prescriptive period for filing an appeal with the CTA and cannot be cited by taxpayers. such as San Roque. who belatedly filed their judicial claims more than 30 days after receipt of the adverse decision of the CIR on their administrative claims or the lapse of 120 days without the CIR acting on their administrative claims. Pertaining to the similarly situated Philex, the Court ruled in San Roque (2013) that: Philex's situation is not a case of premature filing of its judicial claim but of late filing, indeed very late filing. SIR Ruling No. DA-489-03 allowed premature filing of a judicial claim, which means non- exhaustion of the 120-day period for the Commissioner to act on an administrative claim. Philex cannot claim the benefit of SIR Ruling No. DA-489-03 because Philex did not file its judicial claim prematurely but filed it long after the lapse of the 30-day period following the expiration of the 120-day period. In fact, Phi lex filed its judicial claim 426 days after the lapse of the 30-day period." (Underscoring supplied) A careful analysis of the foregoing dates would reveal that petitioner is similarly situated as Philex in the San Roque case. While petitioner filed its administrative and judicial claims during the period of applicability of SIR Ruling No. DA-489-03, it cannot claim the benefit of the exception period as it did not file its judicial claim prematurely. Indubitably, it filed its judicial claim long after the lapse of the 30-day period following the expiration of the 120-day period. Again, BIR Ruling No. DA-489-03 allowed premature filing of a judicial claim, which means non-exhaustion of the 120-day period for the Commissioner to act on an administrative claim, but not its late filing. 59 Succinctly put, late filing is absolutely prohibited, even during the time when BIR ~~ r \1 Ruling No. DA-489-03 was in force. 60 59 CBK Power Company Limited vs. Commissioner ofInternal Revenue, G.R. Nos. 198729-30, January 15,2014. �6 Commissioner of Internal Revenue vs. Mindanao II Geothermal Partnership, G.R. No. 191498, January 15, 2014.

DECISION CTA EB No. 1124 Page 24 of26 Applying the foregoing discussions in the case at bench, although petitioner has complied with the required two-year period within which to file a refund/tax credit claim of its input VAT payments with the BIR by filing its administrative claim: (1) on December 19, 2008 for the 3rd and 4th quarters of 2007; (2) on February 9, 2009 for the 1st quarter of 2008; and (3) on March 11, 2009 for the 2nd, 3rd, and 4th quarters of 2008, it appears however, that petitioner's corresponding judicial claim filed with this Court on March 26, 2010 was filed beyond the 30-day period, as summarized below: Filing date of Last day of the 120- Last day of the 30- Filing date of administrative day period under day period to Petition for judicially appeal claim Section 112(C) from said inaction Review date of filing of before the Court Period December 19, of Tax Appeals 2008 administrative claim 3ra Quarter in case of inaction 2007 February 9, 2009 ~pril18, 200961 May 18, 2009 March 26, 2010 4m Quarter June 9, 200962 July 9, 2009 2007 March 11, 2009 July 9, 200963 August8,2009 15 Quarter 2008 2"0 Quarter 2008 3ra Quarter 2008 4'" Quarter 2008 Notably, Section 112(C) specifically states that in case of failure on the part of the CIR to act on the application within the 120-day period prescribed by law, petitioner only has thirty (30) days after the expiration of the 120-day period to appeal the unacted claim with this Court. Since petitioner's judicial claim for the aforementioned quarters was filed with the Court in Division only on March 26, 2010, which was way beyond the mandatory 120+30 days to seek judicial recourse, such non-compliance with the said mandatory period of thirty (30) days is fatal to its refund rf\ 61 As there was no sufficient proof that petitioner submitted any supporting documents to the BIR, the 120-day period commenced to run from December 19, 2008, the date of filing of petitioner's administrative claim. (Refer to footnote no. 30 of Commissioner of Internal Revenue vs. Silicon Philippines, Inc., G.R. No. 169778, March 12, 2014.) 62 As there was no sufficient proof that petitioner submitted any supporting documents to the BIR, the 120-day period commenced to run from February 9, 2009, the date of filing of petitioner's administrative claim. (Refer to footnote no. 30 of Commissioner ofInternal Revenue vs. Silicon Philippines, Inc., supra.) 63 As there was no sufficient proof that petitioner submitted any supporting documents to the BIR, the 120-day period commenced to run from March 11, 2009, the date of filing of petitioner's administrative claim. (Refer to footnote no. 30 of Commissioner ofInternal Revenue vs. Silicon Philippines, Inc., supra.)

DECISION CTA EB No. 1124 Page 25 of26 claim on the ground of prescription.54 Hence, the failure of petitioner to observe the 30-day period under said Section 112 through its belated filing of the Petition for Review before the Court in Division warrants a dismissal with prejudice for lack of jurisdiction.55 WHEREFORE, in light of the foregoing considerations, the Petition for Review is hereby DENIED for lack of merit. The assailed Resolution dated November 21, 2013 and Resolution dated February 5, 2014 are hereby AFFIRMED. SO ORDERED. AEssR~~~s.tUicYe WE CONCUR: Presiding Justice s:l~~ c~~/ Q. LOVELL R. BA JffANITO C. CASTANEffA, JR. Associate Justice ~ CAESAR A. CASANOVA Associate Justice 64 Refer to Commissioner ofInternal Revenue vs. Silicon Philippines, Inc., supra. 65 Refer to Commissioner ofInternal Revenue vs. Silicon Philippines, Inc., supra.

DECISION CTAEBNo.1124 Page 26 of26 ~N.M~~-6'~ ~~�.:-y~/.,L_ CIELITO N. MINDARO-GRULLA AMELIA R. COTANGCO-MANALASTAS Associate Justice Associate Justice ON LEAVE MA. BELEN M. RINGPIS-LIBAN Associate Justice CERTIFICATION Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the above decision were reached in consultation before the case was assigned to the writer of the opinion of the Court En Bane. Presiding Justice