CTA Case No. 4349 (Decision)

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY PNOC SHIPPING AND TRANSPORT CORPORATION, P e t i t i o n e ~~ , - versus - C.T.A. CASE NO. 4349 COMMISSIONER OF INTERNAL REVENUE, - - - )( - Respondt!!nt. - - - - - -x D E C: X S 0N Retpondent Comm iss ionet~ of Intet~ nal Revenue, in a motion filed on June 2 8, 1989, seeks the dismissal of the petition for review in the above- entitled case on the gt~ ound that the appeal is alread time ban~ed. Consequently, this Com~ t has no jurisdiction to take cognizance thereof as contemplated in Section 230 of the National Internal Revenue Code, as amended. We agree with respondent. The pertinent facts as alleged in the petition for review disclose that: 4~0

�- I. DECISION - - 2- CTA CASE NO. 4349 Petitioner PNOC Shipping and Tt"ansport Corporation is a government-owned and controlled corporation duly ot"ganized and existing in accordance with Philippine laws with principal offices at 7901 Makati Avenue, Makati, Metro Manila, in 1982, petitioner put"chased a vessel using the proceeds of a foreign loan from the International Bank of Japan; in 1985, petitioner paid two regular amortizations which were deposited with the Central Bank of the Philippines; on April 15, 1986, petitionet" filed its corpot"ate income tax return for 1985 and paid the amount of P17,245,131.00 under BIR Payment Order No. B7731259 dated Apt"il 15, 1986 and CB Confit"mation Receipt No. B378167; on Apt"il 14, 1988, petitionet" filed a claim for refund Ot" tax ct"edit in the amount of P9'�7, 088. 00 as alleged ovet�payment of income tax for the yeat" 1985; on Febt�uat"Y 20, 1989, petitioner received respondent's decision denying petitioner's claim for refund/tax credit of the aforesaid sum of P947,088.00; and on March 22, 1989, petitioner appealed to this Court. At this js..tnctut"e, it may be mentioned that instead of an answet", respondent filed the instant

-- ' DECIS I ON CTA CASE NO. 4349 - 3- mot i on whet~ e in he in t e t~ posed esct~ipt ion of the right of petitionet~ to claim fat~ the t~efund/tax credit of the income tax alleged to have been excessively paid, invoking Section 230 (formerly Sec. 306) of the National Internal Revenue Code, as amended. Said law pertinently provides: Sec. 230. Rec_ove~ of Ta.x ~~_Qnf! o UJ!Lb'_ Q_r:_j 11 ega ll_y_Co 11 ect ed.- No suit or proceeding shall be maintained in any cout~t fat~ the t~ecovet~y of any national intet~nal t~evenue tax het~eaftet~ alleged to have been erroneously or illegally assessed at~ collected, at~ of any penalty claimed to have been collected without authot~ity, at~ of any sum alleged to have been excessive or in any mannet~ wt~angfully collected, until a claim for refund or credit has been duly filed with the Commissioner; but such suit or proceeding may be maintained, whether or not such tax, penalty, at~ sum has been paid under protest or duress. I n__ft_!!Y....__G_S\...? ~_,.___n_g___...ll\_ch_ _SJJj. t __oy.: PT Q_~'-'��d.i.ng__s_b_~l_L___Ia!t_____b._@�, m__~ ft e_r__j;J:t!t �-~Pi t~at i g_t}__Q_f_i~_Q__y_~at~s _ft~am t_hg__d_S'_i_~_g_f . p_~lti-'-JJ_t__g..f___~tl-~_-.t. .9.1L_QJ:"'_J;L~D-a_l_~.;t._t::g_g_~ t"..Q.l_~_~_�_ g_f__~_DY supervening c_aus~that may ari s~ M~~-t::__p..9_Ymen:t_: x x x <Undet~scot~ing Olt\'"S. ) The fot~egoing pt~ ovision t~equires t h a t befot~ e any a c tion may be instituted in court for recovery of any intet~nal t~evenue tax alleged to have been erroneou9ly or illegally assessed ot~ collected, ot~ any sum alleged to have been excessive at~ in any 422

- DECISION CTA CASE NO. 4349 - 4- manner wrongfully collected, the taxpayer must first file a claim fat" t"efund thet"eof with the Commil!lsioner of Intet"nal Revenue within two yeat"s from date of payment and the suit for t"efund must be filed in court within the same period. Thlls, in the case of Gibbs vs. Collector of Internal Revenue and Cout"t of Tax Appeals, 107 Phi 1. 232, it has been held1 "x x x it is cleat" that Section 306 <now Section 230) of the Nat i anal Internal Revenue Code should be construed together with Section 11 of Republic Act No. 1125. In fine, a taxpayer" who has paid the tax, whethet" undet" pt"ot est ot" not, and who is claiming a refund of the !lame, must comply with the t"equi rement s of both sections, that is, he must file ~ claim for t"efund with the Collector of l.nt_t_t''J1~l Re_venu~--~i thin 2 yej~rs ft"om th~ d._~.i!t_ _ q_L_t)j s __gSY_m e.n.L_g_f____1h ~a x.,_J2_ t" ~..QJ!i \'" t_c;;L_ey-2_~j_Q____Q~ct i CliL-.J.96_ _o..f.......__t ~ r~t~ t j.....Qn a l_ _:[n t e t"n~j_ _R~Y..~.n UL_ G0 de' and appeal to the Court of Tax Appeals within 30 days ft"om t"ece i pt of the Co 11 ect Ot"' s decision or ruling denying his claim for refund, as required by said Section 11 of Re prJb 1 ic Act No. 1125. If, howe v et",__j; he C....QilJ?.!i..i.Q.r _ t.__~!5JL~___j;_i!l.!.~__!_n_ _g~ c ~.Q.tQ!l._ t h~ !;_la _l!!!.t. and the per_i qd of twg___y_Et_~t"s_!...a. ~ b o ut_ u_e n g...,___t.bJL...,.?_qj _t;_Qr_J;!t" p_!;_~_g__d i n 9.-!I.!J:!..St_ t>_e_ s t_~ t"t..~..d_ ! n__:th.!L CC!JJ t"_i__o_f_T~~A.Q..Q e ~.!..�. t!!t_fQt"e_ th~__Jtll....d of the two-y~at" peri ad with_Q.!,J.i..__aw~itlM the d~cision . of th_~ C_P.J.J....'-_c;j;_p_:c_,_ _ __ _"(tl~..�...__i.~-~-Q... I:;!_tt~.9J,t_~ e o f __t..b..~ p_qj! i t i YL.J:.~J;Lt.Jj,.r.e l!!._g]'l__.t__Q_f_!;:) ~.!;_1;.j o .D_~06 ~llQ ~ .t.Ht_.Q_QJ;~_t..r.1.D.JL_ttL~.t_d.~-.l~_y__qf._j;_b~__!;_pJ,..1..~~-Rr. i!L l'"endel'"i.ng_.deci s ion does not ext end the &H'tl'"!!!'l!..Qt..Q.!:Y__g~.ri od fixed p~he statute. (U.S. vs. Michael, 282 U.S. 656, 51 S. 423

- �- DECISION CTA CASE NO. 4349 - 5- Ct. 284; P. J. Ki enet~ & Co. , Ltd. vs. David, 92 Phi 1. 9'+5, 49 Off. Gaz. [5] 1852; Co 11 ege of Ot~al & Dental Surg et~y v s. Colwt of Tax Appeals, 102 Phi 1. 912; 5lt Off. Gaz. [29] 7055. ours. ) <Und et~scot~ i ng In the case at bat~, it appeat~s that the tax sought to be refunded or credited was paid on April 15, 1986. While the claim fot~ t~efund was filed with the Commissioner on April 14, 1988, within two years from the date of payment, the judicial action for recovery was instituted with this Court only on March 22, 1989. It is thus clear beyond doubt that court action fot~ t"' ecovet"'Y of the alleged excess ' payment of income tax corresponding to the taxable year 1985 is already time barred inasm1.1ch as Section 230 t"'equit"'es that judicial action must be instit�Jted within two yeat"'S ft"'om date of payment. In other wm~ds, the taxpayet"' must file a wt~itten I claim for t"'efund with the Commissionet~ of Intet"'nal / / Revenue within two years after payment of an internal t~evenue tax alleged to have been erroneo�Jsly or illegally paid and the action for recovery must be instituted in COllt"'t also within two years after payment pursuant to Section 230 of the National Internal Revenue Code. 424

-- DECISION - CTA CASE NO. 4349 - 6- WHEREFORE, the petition fat~ t~eview filed in this case dismissed fat~ lack of jurisdiction at petitioner's costs. SO ORDERED. Ql.tezon City, Mett~o Manila, August 30, 1989. WE CONCUR1 <on leave) CONSTRNTE C. RORQUIN Associate Judge ~ Associat0 ~ R~~~ CE RT I F I CRT I 0 N I hereby certify that this decision was reached after due consultation among the members of the Court of Tax Appeals in accordance with Section 13, Article VIII of the Constitution. AMANTE Presidi 425