CTA Case No. 4788 (Decision)

HEPUBLIC LIF lHE PHLLIPPlNES ClllJH r OF TAX f-lPPEALS (}UI::: lON CI. rY MI-U n Ut. Vt..LLIJJMI.:.N r CUI-<PUW-\ I I UN, C.T .A. CASE NO. 4788 Petitione1~, -- X - vers1.15 - COMMJSSlUNER OF INrERNAL JU: VENUE, Respondent. X- - - - - - - - DEc:.: :1" S ..1 LJ/V T hi s is a c~aim f m~ the ,~efund of P124,402.40 repre s en t ing a l leged eMcess w1thholding tax payments for taxab l e year 1YB3. ~et i tioner, a corporation engaged in the renting out filed its income tax retu r n fo1~ 1989 t a >< due to be pa1d by 1t in the amount of P 195, 0 91 . 00 . F rom t hi s tax due was deducted or applied tax due balance of P119, 132.00. However, there is a 5~ c r editable tax withheld from the petitioner for the year He n ce, eccol~ding to P P t i t i on e ,~ , t ~~ i s ,~ e s u l t e d to an exc~ss payment of income taxes 1n the amount of Pl24,402.40. 1-<espondent., on thE:' othet~ hand, at��gued i n 1'1e mo ,~ an d '-' m t h a t. the amount oi" 92 3

DECISION - C . r. ~l. t.: fm E NU. L, llW -2 1-'et i t 1 oner~' s p r 1 o r e y a~~ (1 '988) e XC I? S S t a x cre d i t a ctu a l ly and in f act withh old ing ta xe s , 1985, 198EJ, 1987 a n d 1988 <~>< hs. "F-" to " H.-3" , 1nc l us1 ve, 1-'etit lo net~). Suc h be i ng th cas e , an y c l a 1m for tax has pr e sc1~ i b ed t he 1n sta n t pE>t1t.1on hC~vlng l.lel? n f 1 le d only on f.-l pt~ l ] 14 , 1 O:J92 0! ~ mor-e t han tw o ( 2) ft~om t h e d a t e of paym e n t <M P. mcw and u m f o ,~ t h e He s pond e n t , p. 4 ) � 1s co r rect 1n cJ a1m1 ng t h at set 1 n, p ur s 1.1ant to Se>c. 23C> of the Nl fiL:, 1t. "I S only t ru e to 1 98 8 T he ex cess creditable wit hhol d ing 1988 WP.t"' f:' val idly carr 1ed over o t~ a pplie d t o 190g 1ncome tax ll a b1J 1t y pur sua nt to Sec . 69 of the Nl RC whic h pro vid e s thus: Sec . 69. Fin a l ad ju st me nt return. - Eve r y c o rpo r atio n l1 a bl e to t a x under Sect ion 24 s h a 1 1 f i 1 I? a r i n a 1 ad j '�' s t . me n t ~~ eo t tw n c o v e t" i n g th e tu t al t ax able 1 n come f or fh e pr ec eding c a 1 e n d a r o ,~ f i s c a ] y e a t~ . 1 t t he s u m o t t he quarterly ta x p ay me nts made du r1 ng th e s aid taxable y ear i s not e qua l to the total ta x due on the enti re taxa b l e 1n c o me ot th at yea r the corp o ra t i o n sha ll e it her : . Ca l P a y t h e excess t a x s t i l l du e or Cb l B E' ~ ~ e fun d ed t h e� ex c e s s amo unt paid , as t h e c.:-t se may be 1 n cas t he c o, ~ p or' at i on i s e n t 1 t 1 e d f o ~~ a refund o f t he e~c e ss e s t1m a ted qua r t e rly 1n co me t a ){ e s p a 1 d , t h I? 1 ~ P 1 u 11 d .:-1 b l e a 111 o 1..1 n t s h o w n o n 1 t s f .i n c:tl ad j �J s t men t. ,~ e t u rn ma y be CT E' d i t e d a o a i n s t t h~---'" s t i_ ~_<i}..t_e_j__q u a y� ~~-t::J....~c om e t a x l 1 a b 1 1 i t 1 e s 92~.t

OECI51UN - C.T.R. CASE NO. 47BO 3- iol�� the taxable q~laJ ~ teJ~s of the succeeding taxa ble year�. <c;ee e~l-:>o Pa se o Real ty and Dev elopm e n t Corp. v. Commission e r of Int ernal Revenue, CTA Cas�:� No. 4528 , Apl~i 1 30, 1'993 . l Hence, from the the con s 1 d e ,~ e d as th e sE' p~rta 1n to cre d1tabl e w1th old1ng tax e s 1 '388. Exhibit also not cons idered in Our ~.qccee d:i ng computation s1nce s a .i d d t� c '�' mE' n t. 1 s not a Certificate of Credltable Withholding Ta~ At Sou rc e by the w1thholding a ge nt b�.lt .:m a ff:ida v1t own manager wh1ch could th ere for e b e con&ider ed Re !:-pondent contended that the Wl thholdlng taxes in the amount o f P l24,4 p2 . 40 for th e year� 1989 1!-1 e r� e no 1 on g f.> r� r e fund a b 1 e . F or' said taxes 1!-lere alread y appl1ed by pet 1t1oner� 1n l t s f i r st and second quarter income tax lia bilities. Ho~�H~ v er , the qua.r- tP.1" lY income tax paym e nts f or� the fir s t and second quarter s of 1'3'30 i n the amo unt of P78,492.00 and P18 , 866 . 00 <Exhs . "2" , "2-a'' 7 ".J'�, "3-a." , Respondent ; Exhs . " T", and " U " , P e t i t i o n e t~ ) s h o t..tl d on l y be consl dered as mere in stallm ents of the annual inc o me t. ax dUE'. "T hese payments vlhich computed based on the cumulative of gros s J~ece i pt:. and deduct 1 on!:� 1n order to arr1 v e at a ne t 925

" 11 l. ,- ., \ / ,.. DEC l SIUN C.T . A. CASE NO. 4788 - 4- t ~ x 'a b 1 e 1 n c o me , s. h o 1.1 J d b e t r~ e ~ t e d a 5 advances or po r t ion s of the e~nnu~1 income taH due, to be ~d Just e d at the end o f t he c a 1 end a~~ or ~his is re infor ce d b y Section 87 <now Section S9J wh1ch pr ov i d e s fm~ t he filing of adJ'.lstment pa y men t o f inc.ome t;;~x . " <Commissioner of� I ntern a l Revenue v. TMX Sale s, Inc., et al., G.R. Nu . 8 373& , J~nuary 15, 1992 ) Re spondent shou ld bE' " wh e l~ e t h e t a >< i s by t h e taxpayer in q~a r terly 1n sta l lments , the f i n al payment is at th e e nd of t he ta x i t is final l y ascer t e~ine~bJ e that th e taxpa y er eithe r ma de losses in 1t s o pel~ations" . <Comwi _ssio ner of I n tern a l Reve nue v. IMX � S al es , l n c ., et a 1 � , s 1..1 p ~-� ~ ) ln the i nstant cc-t se> , petiti oner su ffered a net lo ss opeTat 1 o n 111 the 1:JYO 1 n the am o u nt o f P322, 348. Lt3 <Exh . "5", RE'spondent ; E xh. " R" , P et itionet~ ) . fo l lo~.>Js tllat pl"tltlo ne r h as no inco me tax liability. Th us , i t s c ~-� e d i t a b 1 e w i thholdi ng taxe s f Ol" t he> year 1989 ca nno t bE' ut1lJzed i n 199 0 . Fw~the r , petitioner cannot apply th e excess pay ment s in 1989 more than the ye;;w 1'3 90 W l 1 l t" un c ount E'l" w:i t h the p r- ovision of l<:~w . l~aspo Healty an d UP. velopm e n t Corp. v . Com mis sioner of Jnternal Revenue, s upra) 92

DECISION - C.l.R. CAS~ NU. ~1 66 - 5- Thus , t he claim for refun d/taM credit GRANT ED but on a reduced amount of P111,502 .40, computed a s follows : Tax DuP for 1989 lsep Exh. "A"I LPss: Prior yPar tax rr pdi t fi9B8l W!j_hh(IJ_lll!!!J J!!l~nL Exh. Aaount of lax Wi thheld National Bookstore, Inc. F p 31 ,800.00 Yasaka !Mani lal Industry, Inc. G 13, 122. 00 Car�elo! Bauer�ann Pr1nt1ng Corp. H 12, 1&?.00 Pnte Inc-. 1 4,400. 00 1,800. 00 Res ins Incorporated J 63,284.00 Aaount of Pl.l1,807.00 Re�aining tax liabil ity for 1989 TaK Withheld PIJO, 380.00 243,309.40 l ess: Creditab le Withho lding TaMes for 1909 IPli 1, 502. ljQ) 53,800. 20 loh t h~l!!!.!lg_flyent f.xh . 4'1,8b4. 20 5,240. 00 Crown Cards Corporatton l 1, 800. 00 2, 225.00 Yasaka lManilal Industry, Inc. 1'1 Cartelo &Bauertann Print ing Corp. N Pri�e Inc . 0 Resins Incorporated p Ten!5ita Roxas (} Total A�ount Refundable ln all the the Re s pond ent 1s h er eby ORDERED to REFUND the Pet itio ner or issue a tax credit on its. be half for the am ount of P111 , 50 2 .40 represen~ing excess income tax payment. SU lHWEREO. ~Q,~ EHNESlO �). ACOSTA Pr e sid ing Judge

m:r r s roN - C. T. fl. r: r-1!:;E NO. 4 -n:Hl WE:. CUNCUH: GRUBA C F:� F~ .T . T F J C (-=\ ~- I 0 1"-l deC l Sl.011 W.:lS art f' I' ' d I) E' C 0 ll '5. IJ ll; a f; l 0 1l a rr on y \:t 1 e mem be t� s o f the Co u f ' t o f I) I Il o f ~Q.~ ERNE$TU D ~ ACOSJA Pt~ e siding JurlgP C o ur�t r�f 'T a .H {~ pJ u�. t l '� 928