TAISEI PHILIPPINES CONSTRUCTION, INC. v. COMMISSIONER OF INTERNAL REVENUE

REPUBLIC OF THE PHILIPPINES COURTIOF TAX APPEALS QUEZON CITY SECOND DIVISION TAISEI PHILIPPINES CTA CASE NO. 9008 CONSTRUCTION, INC., Members: Petitioner, - versus- CASTANEDA, JR., Chairperson, CASANOVA, and MANAHAN, JJ. COMMISSIONER OF INTERNAL Promulgated: REVENUE , DEC 0 1 2017 'f: ~ J�~- x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x DECISION CASTANEDA, JR., } .: THE CASE This is a Petition for Review1 filed by Taisei Philippines Construction, Inc. praying for the refund or issuance of a tax credit certificate (TCC) in t he amount P84,175,660.03, allegedly representing its unutilized ~nput valued-added tax (VAT) payments attributable to VAT zero-rated sales to Philippine Economic Zone Authority (PEZA) and Clark Special Economic Zone (CSEZ)-registered 9v clients for the four quarters of 2012. 1 Docket, pp . 6- 18.

DECISION CTA CASE NO. 9008 THE FACTS Petitioner Taisei Philippines Construction, Inc. is a corporation duly organized and existing under Philippine laws, with principal office address at 23rd Floor Equitable Bank Tower, Paseo de Roxas Avenue, Legaspi Village, Makati City. 2 It is a VAT-registered taxpayer with Tax Identification No. 000-166-308-000.3 On the other hand, respondent is the duly appointed Commissioner of the Bureau of Internal Revenue (BIR) who has the power to decide disputed assessments, refunds of internal revenue taxes, fees or other charges, penalties imposed in relation thereto or other matters arising under the National Internal Revenue Code (NIRC) or other laws or portions thereof administered by the BIR. He holds office at the BIR National Office Building, Agham Road, Diliman, Quezon City. Petitioner filed its Quarterly VAT Returns for taxable year 2012, as follows: DATE OF FILING PERIOD NET UTILIZED COVERED INPUT VAT April 24, 20124 July 23, 20125 1st Quarter of 2012 p 6,808,604.56 October 24, 20126 2nd Quarter of 2012 April 23, 20137 (Amended Return} 3rd Quarter of 2012 P14,475,196.84 4th Quarter of 2012 P75,792,340. 98 P95_L693_L022.90 On June 25, 2013/ petitioner filed its administrative claim for refund amounting to P84,175,660.03 for the input VAT it paid attributable to VAT zero-rated sales of service for taxable year 2012. Respondent issued Letter of Authority No. 122-2013-000000549 on July 29, 2013, authorizing Revenue Officers Amelia Molinos,)4: 2 Par. 1, Summary of Admitted Facts, Joint Stipulation of Facts and Issues (JSFI), docket, p. 203. 3 Par. 2, Summary of Admitted Facts, JSFI, docket, p. 203. 4 Exhibits "P-5", "P-6", and "P-6-A", docket, pp. 228-230. 5 Exhibits "P-7", "P-8", and "P-8-A'', docket, pp. 237-239. 6 Exhibits "P-9", "P-10", and "P-10-A", docket, pp. 246-248. 7 Exhibits "P-11", "P-12", and "P-12-A", docket, pp. 255-257. 8 Exhibit "P-37", docket, p. 290. 9 Exhibit "P-39", docket, p. 292.

DECISION CTA CASE NO. 9008 Belinda Balagtas, Lourdes Liwanag, and Noemi Castro to examine petitioner's books of accounts and other accounting records for value-added tax for the period from January 1, 2012 to December 31, 2012 pursuant to Mandatory Audit-Claim for VAT refund. On July 30, 2013,10 respondent issued another letter authorizing Revenue Officer Fatima Sarrosa to assist in the examination/investigation of petitioner's books of accounts and other accounting records pursuant to Letter of Authority No. 122-2013- 00000054 dated July 29, 2013 for value-added tax for taxable year 2012. On even date, respondent issued to petitioner a "Checklist of Requirements in Filing VAT Credit/Refund Claims".11 Meanwhile, petitioner submitted its additional documents in batches, where its last batch of documents was submitted on October 14, 2014. 12 Petitioner also submitted a Sworn Certification13 attesting to the completeness of the documents it submitted to the BIR. Due to respondent's inaction on its administrative claim for refund, petitioner filed the present Petition for Review before this Court on March 13, 201514� Within the extended time granted by the Court, 15 respondent filed his Answer16 through registered mail on May 6, 2015 and received by the Court on May 18, 2015, interposing the following special and affirmative defenses: "SPECIAL AND AfFIRMATIVE DEFENSES XXX XXX XXX 7. Petitioner's claim for refund or issuance of tax credit certificate in the amount of P84,175,660.03 ft-- 10 Exhibit "P-40", docket, p. 293. 11 Exhibit "P-41", docket, pp. 294-297. 12 Exhibit "P-43", docket, p. 299. 13 Exhibit "P-42", docket, p. 298. 14 Docket, p. 6. 15 Order dated April 28, 2015, docket, p. 83. 16 Docket, pp. 84-86.

DECISION CTA CASE NO. 9008 representing alleged excess and unutilized input VAT paid for the four quarters of 2012 were not fully substantiated by proper documents, such as sales invoices and official receipts, pursuant to Revenue Regulations No. 7-95 in relation to Section 113 and 237 of the 1997 Tax Code. 8. In an action for refund/credit, the burden of proof is on the petitioner to establish its right to claimed refund and failure to adduce sufficient proof is fatal to the claim for tax refund/credit. 9. It is incumbent upon the latter to show that it has complied with the provisions under Section 204 (c) in relation to Section 229 of the Tax Code. Otherwise, its failure to prove the same is fatal to its claim for refund. 10. Claims for refund are construed strictly against herein petitioner since the same partakes the nature of exemption from taxation (Commissioner of Internal Revenue vs. Ledesma, 31 SCRA 95) and as such, they are looked upon with disfavor (Western Minolco Corp. vs. Commissioner of Internal Revenue, 124 SCRA 1211)." The pre-trial conference was set on June 25, 2015.17 Thus, petitioner's Pre-Trial Brief18 was filed on June 19, 2015; while respondent's Pre-Trial Brief19 was filed through registered mail on June 19, 2015 and was received by the Court on July 2, 2015. The parties filed their Joint Stipulation of Facts and Issues20 through registered mail on July 27, 2015 and was received by the Court on August 10, 2015. This was approved and adopted by the Court in the Pre-Trial Order21 issued on September 9, 2015, which ?z- also terminated the pre-trial. 17 Notice of Pre-Trial Conference, docket, pp. 88-89. 18 Docket, pp. 90-97. 19 Docket, pp. 122-125. 20 Docket, pp. 153-155. 21 Docket, pp. 209-214.

DECISION CTA CASE NO. 9008 Upon motion22 of petitioner, the Court commissioned Aquino Mata Calica & Associates ~as the Independent Certified Public Accountant (ICPA) for the case, with Mr. Joseph Cedric V. Calica as named partner-in-charge of the undertaking.23 During trial, petitioner presented the following witnesses: Mr. Vicente M. Evangelista 24 its Accounting Manager; and Mr. Joseph , Cedric V. Calica25, the Court-commissioned ICPA. On February 15, 2016, petitioner filed through registered mail its Formal Offer of Evidence.26 In the Resolution27 dated April 13, 2016, the Court partially admitted petitioner's Exhibits. However, the Court denied the admission of Exhibits "P-9", "P-13", "P-41 ", "P-41- a", "P-41-b", and "P-41-c" for failure to identify and for failure to present the originals for comparison; Exhibits "P-46", "P-47", "P-50", "P-51", "P-52", and "P-53" for failure to present the originals for comparison; and Exhibits "P-56-1790" to "P-56-1799", "P-56-4090", and "P-58-127" for not being found in the records. On May 5, 2016, petitioner filed through registered mail its Motion for Partial Reconsideration (Of the Resolution dated April 13, 2016). 28 In the Resolution29 dated July 26, 2016, the Court allowed petitioner to present Ms. Judy Ann R. Rufin 30 its employee, to lay the , basis for the introduction of secondary evidence. The ICPA, Mr. Joseph Cedric V. Calica3\ was likewise recalled and petitioner was allowed to present the originals of some of its denied exhibits for comparison. )<1-- 22 Docket, pp. 158-162. 23 Oath of Commission, docket, p. 222. 24 Minutes of the Hearing dated September 28, 2015 and November 25, 2015, docket, pp. 220 and 311; Judicial Affidavit, docket, pp. 105-119. 25 Minutes of the Hearing dated January 25, 2!016, docket, p. 327; Judicial Affidavit of Mr. Joseph Cedric v. Calica, docket, pp. 316-326. 26 Docket, pp. 335-372. 27 Docket, pp. 380-382. 28 Docket, pp. 408-415. 29 Docket, pp. 466-467. 30 Minutes of the Hearing dated September 5, 2016, docket, p. 468; Judicial Affidavit of Ms. Judy Ann R. Rufin, docket, pp. 433-436. 31 Minutes of the Hearing dated September 5, 2016, docket, p. 468; Judicial Affidavit of Mr. Joseph Cedric V. Calica {To Identify the Certification dated May 4, 2016), docket, pp. 445-448.

DECISION CTA CASE NO. 9008 Thereafter, petitioner filed a Supplemental Formal Offer of Evidence32 through registere<tJ mail on September 15, 2016, which was received by the Court on September 22, 2016. In the Resolution33 dated December 2, 2016, the Court granted petitioner's Motion for Partial Reconsideration and admitted Exhibits "P-41", "P-41-a", "P-41-b", "P-41-c", "P-46", "P-47", "P-56-1790" to "P-56-1799", "P-56-4090", "P-58-127", "P-70", "P-90", "P-91", and "P-92". During the hearing on September 5, 2016, counsel for respondent manifested that he has no witness to present in this case. 34 Petitioner filed its Memorandum35 through registered mail on January 9, 2017 and was rec~ived by this Court on January 19, 2017. Meanwhile, respondent's Memorandum36 was also filed through registered mail on January 9, 2017 and was received by the Court on January 25, 2017. Thus, in title Resolution37 dated January 31, 2017, the instant case was declared submitted for decision. THE ISSUES The parties submitted the following issues to be resolved by this Court: 38 1. Whether or not the sales of petitioner in the four quarters of 2012 to its PEZA and CESZ clients are subject to 0�/o VAT. 2. Whether or not the unutilized Input Taxes of petitioner for the four quarters of 2012 which it applied for refund or issuance of tax credit certificate, are duly ;z- supported by VAT Receipts and Invoices and are 32 Docket, pp. 470-475. 33 Docket, pp. 480-482 34 Docket p. 468. 35 Docket, pp. 483-506. 36 Docket, pp. 509-514. 37 Docket, p. 516. 38 Issues, JSFI, docket, p. 204.

DECISION CTA CASE NO. 9008 attributable to VAT-zero-rated sales of services made by petitioner to its PEZA and CESZ registered clients. 3. Whether or not the respondent erred by her inaction on the claim for VAl refund or issuance of tax credit certificate of petitioner for unutilized Input VAT attributable to its VAT zero-rated sales to PEZA and CESZ clients in the four quarters of 2012. THE RULING The Court shall determine first whether it has jurisdiction to entertain the present case. It must be emphasized that jurisdiction over the subject matter or nature of an action is fun~amental for a court to act on a given controversy, and is conferred only by law and not by the consent or waiver upon a court which, otherwise, would have no jurisdiction over the subject matter or nalure of an action. Lack of jurisdiction of the court over an action or tHe subject matter of an action cannot be cured by the silence, acquiescence, or even by express consent of the parties. If the court has no jurisdiction over the nature of an action, its only jurisdiction is to dismiss the case. The court could not decide the case on the merits.39 The Court of Tax Appeals is a court of special jurisdiction and can only take cognizance of such matters as are clearly within its jurisdiction.40 The jurisdictiortl of the CTA regarding internal revenue tax assessments is provided under Section 7(a)(1) and (2) of Republic Act (RA) No. 1125, as amended by RA Nos. 9282 and 9503, which provides: "SEC. 7. Jurisdiction.- The CTA shall exercise: (a) Exclusive appellate jurisdiction to review by appeal, as herein provided: <f- 39 Nippon Express {Philippines) Corp. v. Commissioner of Internal Revenue, G.R. No. 185666, February 4, �2015. 4 Commissioner of Internal Revenue v. Silicon Philippines, Inc. (formerly Intel Philippines Manufacturing, Inc.), G.R. No. 169778, March 12, 2014.

DECISION CTA CASE NO. 9008 (1) Decisions of the Commissioner of Internal Revenue in cases involving disputed a~sessments, refunds of internal revenue taxes, fees or other charges, penalties in relation thereto, or other matters. arising under the National Internal Revenue or other laws administered 'by the Bureau of Internal Revenue; (2) Inaction by the Commissioner of Internal Revenue in cases involving disputed a$sessments, refunds of internal revenue taxes, fees or other charges, penalties in relations thereto, or other matters arising under the National Internal Rev�nue Code or other laws administered :by the Bureau of Internal Revenue, where the National Internal Revenue Code provides a specific period of action, in which case the inaction shall be deemed a denial;" (Emphasis supplied) Similarly, Section 3(a)(1) and (2) of Rule 4 of the Revised Rules of the Court of Tax Appeals states: "SEC. 3. Cases within the jurisdiction of the Court in Division.- The Court in Division shall exercise: (a) Exclusive original over or appellate jurisdiction to review by appeal the 'following: (1) Decisio!ns of the Commissioner of Internal Re~enue in cases involving disputed asses~ments, refunds of internal revenue taxes, fees or other charges, penalties in relation thereto, or other matters arising under the National Internal Revenue ~

DECISION CTA CASE NO. 9008 Code or other laws administered by the Bureau of Internal Revenue; (2) Inaction by the Commissioner of Internal Reve~Jue in cases involving disputed asses$ments, refunds of internal revenue taxes, fees or other charges, penalties in relation thereto, or other matters arising under the National Internal Revenue Code or other :laws administered by the Bureau of Internal Revenue, where the National Internal; Revenue Code or other applicable law provides a specific period for action: Provided, that in case of disputed assessments, the inaction of the Commissioner of [nternal Revenue within the one hundred eighlty day-period under Section 228 of the National Internal Revenue Code shall be deemed a denial for purposes of allowing the taxpayer to appeal his case to the Court and does not necessarily constitute a formal decision of the Commissioner of Internal Revenue on the tax case; Provided, further, that should the taxpayer opt to await the final decisiolil of the Commissioner of Internal Revenue on the disputed assessments beyond the one hundred eighty day-period abovementioned, the taxpayer may appeal such final decision to the Court under Section 3(a), Rule 8 of these Rules; and Provided, still further, that in the case of claims for refund of taxes erroneously or illegally collected, the taxpayer must file a petition for review with the Court prior to the expiration of the two-year period under Section 229 of the National Internal Revenue Code;" (Emphasis supplied) Based on the foregoing, that the CTA shall exercise exclusive appellate jurisdiction to review by appeal the decisions as well as the inaction by the CIR in cases involving refunds of internal revenue)t--

DECISION CTA CASE NO. 9008 taxes. In cases where the NIRC of 1997 provides a specific period for action, the CIR's inaction shall be deemed a denial.41 In relation to the foregoing, Section 112(A) and (C) of the NIRC of 1997, as amended, govern$ the filing of administrative and judicial claims for refund or tax credit of excess and unutilized input tax attributable to zero-rated or effectively zero-rated sales, which reads as follows: "SEC. 112. Refunds or Tax Credits ofInput 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: Provided, however, That in the case of zero-rated sales under Section 106(A)(2)(a)(1), (2) and (b) and Section 108(8)(1) and (2), the acceptable foreign currency exchange proceeds thereof had been duly accounted for in accordance with the rules and regulations of the 8angko Sentral ng Pilipinas (8SP): Provided, further, That where the taxpayer is engaged in zero-rated or effectively zero-rated sale and al$o in taxable or exempt sale of goods of properties or services, and the amount of creditable input tax due or paid cannot be directly and entirely attributed to any one of the transactions, it shall be allocated proportionately on the basis of the volume of sales: Provided, finally, That for a person making sales that are zero-rated under Section 108(8)(6), the input taxes shall be allocate(!j ratably between his zero-rated and non-zero-rated sales. XXX XXX XXX /k- 41 Commissioner ofInternal Revenue v. San RtJque Power Corporation, G.R. No. 187485, February 12, 2013.

DECISION CTA CASE NO. 9008 (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 fr~m 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." In Silicon Philippines, Inc. (formerly Intel Philippines Manufacturing, Inc.) vs. Commissioner of Internal Revenue42, the Supreme Court summarized tme rules on prescriptive periods for filing claims for refund or tax credlt of input VAT vis-a-vis Section 112 of the NIRC of 1997, as amended, to wit: "In the subsequent case of Commissioner of Internal Revenue v. Mindanao II Geothermal Partnership, the Court summarized the rules on prescriptive periods for claiming credit/refund of input VAT, to wit: SUMMARY OF RULE$ ON PRESCRIPTIVE PERIODS FOR CLAIMING REFUIND OR CREDIT OF INPUT VAT The lessons of this case may be summed up as follows: A. Two- Year Prescriptive Period jv 42 G.R. No. 173241, March 25, 2015.

DECISION CTA CASE NO. 9008 1. It is only the administrative claim that must be filed within the two-year prescriptive period. (Aich1) 2. The proper re�koning date for the two-year prescriptive period is the close of the taxable quarter when the relevant sales were made. (San Roque) 3. The only other rule is the Atlas ruling, which applied only from 8 June 2007 to 12 September 2qos. Atlas states that the two- year prescriptive period for filing a claim for tax refund or !credit of unutilized input VAT payments shoulld be counted from the date of filing of the VAT return and payment of the tax. (San Roqu~) B. 120+30 Day P~riod 1. The taxpayer c~n file an appeal in one of two ways: (1) file the judicial claim within thirty days after the Commissioner denies the claim within the 120-day period, or (2) file the judicial claim 'Within thirty days from the expiration of 'the 120-day period if the Commissioner cjjoes not act within the 120-day period. 2. The 30-day period always applies, whether there is a denial or inaction on the part of the CIR. 3. As a general rulle, the 30-day period to appeal is both mandc;Jtory and jurisdictional. (Aichi and San Roque) 4. As an exception to the general rule, premature fili~g is allowed only if filed :;z_ between 10 December 2003 and 5 October

DECISION CTA CASE NO. 9008 2010, when BtR Ruling No. DA-489-03 was still in force. (San Roque) 5. Late filing is � absolutely prohibited, even during the time when BIR Ruling No. DA-489- 03 was in force. (San Roque)" Pursuant to Section 112(A) of the NIRC of 1997, as amended, the application for refund or ijax credit of unutilized excess input VAT must be filed within two (2~ years after the close of the taxable quarter when the zero-rated or effectively zero-rated sales were made. The present claim covers the four quarters of taxable year 2012, which respectively clos~d on the following dates: PERIOD COVEREID CLOSE OF TAXABLE QUARTER (TV 2012) 1st Quarter March 31, 2012 2nd Quarter June 30, 2012 3rd Quarter September 30, 2012 4th Quarter December 31, 2012 Counting two years from the said dates, petitioner had until the following dates within which to file its administrative claim for refund or issuance of tax credit certificate: TY 2012 CLOSE OF T~BLE LAST DAY TO FILE QUART-=R ADMINISTRATIVE CLAIM 1st Quarter 2nd Quarter March 31, ;2012 March 31, 2014 3rd Quarter June 30, ?012 June 30, 2014 4th Quarter September 30, 2012 September 30, 2014 December 3l, 2012 December 31, 2014 r-- Based on the foregoing! dates, petitioner's administrative claim filed on June 25, 201343 was $easonably filed. 43 Exhibit "P-37", docket, p. 290.

DECISION CTA CASE NO. 9008 On the other hand, SE:lction 112(C) of the NIRC of 1997, as amended, states the time re~uirements for filing a judicial claim for the refund or tax credit of iriput VAT. The provision speaks of two periods: (1) the period of 12Q days, which serves as a waiting period to give time for the BIR Commissioner to act on the administrative claim for refund or tax credi~; and (2) the period of 30 days, which refers to the period for filing a judicial claim with the Court of Tax Appeals. 44 It bears stressing that ~he 120-day period begins to run from the date of submission of domplete documents in support of the administrative claim.45 As, to when should the submission of supporting documents de~med "completed" for purposes of determining the running of t~e 120-day period, the Supreme Court's ruling in Pilipinas Total G$, Inc. vs. Commissioner of Internal Revenue (Pilipinas Total Gasj6 is instructive. The relevant portion of the case reads: "Then, when the iNIRC was enacted on January 1, 1998, the rule was once more amended to read: (D) Period within which Refund or Tax Credit of Input +raxes shall be Made. - In proper cases, the! Commissioner shall grant a refund or issue the tax credit certificate for creditable input ~axes within one hundred twenty (120) ~ays from the date of submission of I compete documents in I support of the a~plication filed in accordance with Subsections ~A) and (B) hereof. In case of full or partial denial of the claim for tax refund or tax credit, or the I failure on the par1 of the Commissioner to act on the application I within the. period prescribed above, the taxpbyer affected may, within thirty (30) days from the receipt of the Jv 44 Rohm Apollo Semiconductor Philippines v. Commissioner ofInternal Revenue, G.R. No. 168950, January 14, 2015. . 45 Silicon Philippines, Inc. (Formerly Intel Rhilippines Manufacturing, Inc.) v. Commissioner of Internal Revenue, G.R. No. 182737, March 2, 2016. 46 G.R. No. 207112, December 8, 2015.

DECISION CTA CASE NO. 9008 decision denyingi the claim or after the expiration of the i one hundred twenty day- period, appeal tHe decision or the unacted claim with the Co~rt of Tax Appeals. This time, the per~od granted to the CIR to act upon an administrative claimi for refund was extended to 120 days. The reckoning point however, remained 'from the date of submission ot complete documents.' Aware that not all taxpayers were able to file the complete documents ~o allow the CIR to properly evaluate an administra~ive claim for tax credit or refund of creditable input tax~s, the CIR issued RMC No. 49- 2003, which provided: Q-18: Fof pending claims with incomplete docuf(lents, what is the period within which t([J submit the supporting documents ,required by the investigatingjpro�ssing office? When should the investigating/processing office officially receive claims to~ tax credit/refund and what is the period required to process such claims? A-18: For ~ending claims which have not been ~cted upon by the investigating/proc~ssing office due to incomplete docurrentation, the taxpayer- claimants are !given thirty (30) days within which to I submit the documentary requirements Iunless given further extension by th~ head of the processing unit, but suchl extension should not exceed thirty (3p) days. For claims tp be filed by claimants with the respective intestigating/processing office of the administrative agency, the same shall be officially rec,ived only upon submission of complete documents. ~

DECISION CTA CASE NO. 9008 For current � and future claims for tax credit/refund, th~ same shall be processed within one hundr~d twenty (120) days from receipt of the complete documents. If, in the course of the inv�stigation and processing of the claim, additiohal documents are required for the proper de~ermination of the legitimate amount of claim, ~he taxpayer-claimants shall submit such docwments within thirty (30) da s from : re uest of the investigating/p ocessing office, which shall be const ued as within the one hundred twen 120 da eriod. Consequently, up�m filing of his application for tax credit or refund for e*cess creditable input taxes, the taxpayer-claimant is giv~n thirty (30) days within which to complete the required i documents, unless given further extension by the head of the processing unit. If, in the 1 course of the investigation and processing of the claim, I additional documents : are required for the proper determination of the ~egitimate amount of claim, the taxpayer-claimants shall submit such documents within thirty (30) days . from request of the investigating/processing! office. Notice, by way of a request from the tax cpllection authority to produce the complete documents in 1 these cases, became essential. It is only upon the submi~sion of these documents that the 120-day period would begin to run. Then, when R.A. :No. 9337 was passed on July 1, 2005, the same provisi~:m under the NIRC was retained. With the amendment to Section 112, particularly the deletion of what was dnce Section 112(8) of the NIRC, Section 112 (D) was !amended and renamed 112(C). Thus: (C) Period �tyithin which Refund or Tax Credit of Input taxes shall be Made. - In proper cases, the! Commissioner shall grant a Jb- refund or issue the tax credit certificate for

DECISION CTA CASE NO. 9008 creditable input ~axes within one hundred twenty (120) d~ys from the date of submission of !complete documents in support of the aplplication filed in accordance with Subsection (A) hereof. In case of full or partial denial of the claim for tax re~und or tax credit, or the failure on the par1 of the Commissioner to act on the applicationlwithin the period prescribed above, the taxp~I yer affected may, within thirty (30) days; from the receipt of the decision denying! the claim or after the expiration of thel one hundred twenty day- period, appeal t~e decision or the unacted claim with the Co4rt of Tax Appeals. With the amendm~nts only with respect to its place under Section 112, the Court finds that RMC No. 49-2003 should still be observe' d. Thus, taking the foregoing changes to the law altosether, it becomes apparent that, for purposes of det~rmining when the supporting documents have been dompleted- it is the taxpayer who ultimately determines lwhen complete documents have been submitted for t~e purpose of commencing and continuing the running (Jf the 120-day period After all, he may have already conipleted the necessary documents the moment he filed Mis administrative claim, in which case, the 120-day peripd is reckoned from the date of filing. The taxpayer ~ay have also filed the complete documents on the 30th I day from filing of his application, pursuant to RMC No. f9-2003. He may very well have filed his supporting do�uments on the first day he was notified by the BIR of the lack of the necessary documents. In such i cases, the 120-day period is computed from the da~e the taxpayer is able to submit the complete document$ in support of his application. Then, except in .those instances where the BIR would require additiorlal documents in order to fully appreciate a claim for t~x credit or refund, in terms what additional document m~st be presented in support of a claim for tax credit or r�fund- it is the taxpayer who has?

DECISION CTA CASE NO. 9008 that right and the b~rden of providing any and all documents that would ~upport his claim for tax credit or refund. After all, in a daim for tax credit or refund, it is the taxpayer who has the burden to prove his cause of action. As such, he e~joys relative freedom to submit such evidence to prove his claim. XXX XXX XXX Thereafter, wh~ther these documents are actually complete a~ required by law - is for the CIR and the courtjs to determine. Besides, as between a taxpayer-aplplicant, who seeks the refund of his creditable input tax Iand the CIR, it cannot be denied that the former has gr~ater interest in ensuring that the complete set of docurilentary evidence is provided for proper evaluation of th~ State. Lest it be misun~erstood, the benefit given to the taxpayer to determin~ when it should complete its submission of docume~ts is not unbridled. Under RMC No. 49-2003, if in thel course of the investigation and I processing of the cl~im, additional documents are required for the proper !determination of the legitimacy of the claim, the taxpater-claimants shall submit such documents within thirty (30) days from request of the investigating/processing office. Again, notice, by way of a request from t~e tax collection authority to produce the complet~ documents in these cases, is essential. Moreover, under !Section 112(A) of the NIRC, as amended by RA 9337, ~taxpayer has two (2) years, after the close of the taxa~le quarter when the sales were made, to apply for the Issuance of a tax credit certificate or refund of creditable linput tax due or paid attributable to such sales. Thus, ~efore the administrative claim is barred by prescription~ the taxpayer must be able to submit his complete documents in support of the 1 application filed. This isl because, it is upon the complete submission of his docurpents in support of his application r that it can be said th~t the application was, 'officially received' as provided u~der RMC No. 49-2003.

DECISION CTA CASE NO. 9008 To summarize, fo~ the just disposition of the subject controversy, the rul~ is that from the date an administrative claim fo~ excess unutilized VAT is filed, a taxpayer has thirty (30) days within which to submit the documentary requirem~nts sufficient to support his claim, unless given further e~tension by the CIR. Then, upon filing by the taxpayer! of his complete documents to support his application,! or expiration of the period given, the CIR has 120 days ~ithin which to decide the claim for tax credit or refund. Shlould the taxpayer, on the date of his filing, manifest that ~e no longer wishes to submit any other addition docume~ts to complete his administrative claim, the 120 day pe~iod allowed to the CIR begins to run from the date of filitlg. In all cases, w~atever documents a taxpayer intends to file to lsupport his claim must be completed within ~he two-year period under Section 112(A) of t~e NIRC. The 30-day period from denial of the cllaim or from the expiration of the 120-day period i within which to appeal the denial or inaction of Ithe CIR to the CTA must also be respected. � It bears mentioni~g at this point that the foregoing summation of the rules 'should on/ be made a 1icable ~ those claims for tax ere it or refund filed rior to June 11 2014, such as the claim!at bench. xxx"( Citations omitted) To be sure, it is the ta*payer who ultimately determines when complete documents have been submitted for the purpose of 1 commencing and continuing! the running of the 120-day period. Nevertheless, the Supreme C�>urt also emphasized that the foregoing benefit given to taxpayer is ~ot unbridled and, as such, is subject to limitations. Hence, based orjl the above-quoted portion of Pilipinas Total Gas, the filing of the �omplete supporting documents by the taxpayer in connection with aln administrative claim for VAT refund is subject to the following rules: 1. Upon filing of his alpplication for tax credit or refund for excess creditable inplut taxes, the taxpayer-claimant is given It:-

DECISION CTA CASE NO. 9008 thirty (30) days within which to complete the required documents, unless given further extension by the head of the processing unit. 2. If in the course of ~he investigation and processing of the claim, additional doFuments are required for the proper determination of the! legitimacy of the claim, the taxpayer- claimants shall subri"tit such documents within thirty (30) I days from request! of the investigation/processing unit. Notice of the requ~st for the submission of additional supporting documen~s is required. 3. It is only upon the I submission of the documents by the taxpayer that the 12~-day period would begin to run. 4. In all cases, whatev'r documents a taxpayer intends to file to support his claim must be completed within the two-year period under Sectiqn 112(A) of the NIRC of 1997, as amended. � A review of the record~ shows that the BIR issued a Letter of Authority47 on July 29, 2013, hile it issued another letter on July 30, 201348 with Checklist of Re uirements in Filing VAT Credit/Refund Claims. The said checklist en merated the additional documents that the BIR requested from petit oner for the determination of its claim for refund. � Under RMC No. 49-03, lthe taxpayer has thirty (30) days from notice within which to submitl additional documents requested by the BIR which are necessary for ~he investigation and processing of the claims. As stated earlier, on Jul~ 30, 2013, the BIR requested petitioner to submit additional docum nts to process its claim for refund. Petitioner complied by submitting its supporting documents to the BIR in several batches, whe~e the last batch of its documents was JL- submitted on October 14, 20117. 47 Exhibit "P-39", docket, p. 292. 48 Exhibit "P-41", docket, pp. 294-297.

DECISION CfA CASE NO. 9008 Applying the rules laid drwn in Pilipinas Total Gas and pursuant to RMC No. 49-2003, the 120 day period shall be counted thirty (30) days from July 30, 2013 when the BIR issued a request for additional documents, or from Augus~ 29, 2013. Meanwhile, petitioner's submission of complete doc~ments cannot be deemed made on October 14, 2014, consideri~g that RMC No. 49-2003 provides a limitation of only thirty (3Q) days from the BIR's request for additional documents, within which to submit the same. Thus, counting 120 days from August 29, 2013, respondent had until December 29, 20113 within which to act on petitioner's administrative claim for refun!d. Thereafter, petitioner had 30 days from December 29, 2013, or until January 29, 2014, within which to I file its judicial claim for refund!. Considering that petitiorler filed this Petition for Review only on March 13, 2015,49 the judiciallclaim was filed beyond the prescriptive period provided in Section 112(C) of the NIRC of 1997, as amended. To reiterate, the 30-day!'period within which to file an appeal of I the denial of the claim or in~ction on the part of the CIR is both mandatory and jurisdictio~al, and non-compliance therewith precludes the CTA from acqui~ing jurisdiction over the case. WHEREFORE, premis~s considered, the instant Petition for Review is DENIED for lack of[jurisdiction. SO ORDERED. Q~ c.~~-o~./_9... iUANITO C. CASTANE~A, JR. WE CONCUR: Associate Justice CAESAR~SANOVA Associate Justice t?~� J'-/11~ CATHERINET.MANAHAN Associate Justice 49 Docket, p. 6.

DECISION CTA CASE NO. 9008 ATTESTATION I I attest that the conctlusions in the above Decision were I reached in consultation befor~ the case was assigned to the writer of the opinion of the Court's Divi$ion. ~~~z, c.~~/J: 1UANITO C. CASTAN ED~, JR. Associate Justice Chairperson CERtf"IFICATION Pursuant to Article VIII,ISection 13 of the Constitution, and the Division Chairperson's Attestption, it is hereby certified that the conclusions in the above D~cision were reached in consultation before the case was assignep to the writer of the opinion of the Court. Presiding Justice