CHEVRON HOLDINGS, INC. v. COMMISSIONER OF INTERNAL REVENUE

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY THIRD DIVISION CHEVRON HOLDINGS, INC., C.T.A. CASE NO. 8436 Petitioner, Members: -versus- BAUTISTA, Chairperson; FABON-VICTORINO, and COMMISSIONER OF RINGPIS LIBAN, lL_ INTERNAL REVENUE, Promulgated: Respondent. OCT 2 2 201't x- - - - - - - - - - - - - - - - - - - - - - - - - - ~ - - - - - - 2-J .' -:J3- .-,.. .-.., -' - - - - -x DECISION Fabon-Victorino, J.: In the instant Petition for Review/ petitioner Chevron Holdings, Inc. prays for the refund or issuance of tax credit certificate in the amount of P62,066,592.88, allegedly representing excess and unutilized input value-added tax (VAT) on purchases of goods and services attributable to its zero-rated sales for calendar year (CY) 2010. Petitioner Chevron Holdings Inc. is the Philippine branch of a duly organized multinational American company licensed by the Securities and Exchange Commission (SEC) as a regional operating headquarters (ROHQ) to transact business in the Philippines with SEC Registration No. A199802486 dated June 3, 1998. Its office is located at the 35th Floor, Yuchengco Tower, RCBC Plaza, 6819 Ayala / Avenue, Makati City. 2 1 Docket, vol. 1, pp. 6-12 . 2 Exhibit "A".

Decision C.T.A. CASE NO . 8436 Petitioner is engage in general administration and planning; business planning and coordination; sourcing or procurement of raw materials and components; corporate finance advisory services; marketing control and sales promotion; training and personnel management; logistics services; research and development services and product development; technical support and maintenance; data processing and communication; and business development. 3 It is a VAT-registered taxpayer with Tax Identification Number (TIN) 201-056 - 391-000, as evidenced by Certificate of Registration No. OCN 9RC0000170259 issued by the Bureau of Internal Revenue (BIR). 4 Respondent, on t he other hand, is the Commissioner of Internal Revenue (CIR) with authority to act upon claims for refund or tax cred it pursuant to the provisions of the National Internal Revenue Code (NIRC) of 1997, as amended. Petitioner filed with the Bureau of Internal Revenue (BIR) its Quarterly VAT Returns for the four quarters of CY 20105 on the following dates : . - - - - - - - -- ,---- - - �--- - - - - - - - - - - - - 1 - -P-E-R.IO-D- --+--DATE OF FILING ORIGINAL RETURN uarter April 29, 2010 uarter July 20, 2010 uarter October 20, 2010 ~--~~~--+- --------~~~~~~~----- uarter February 14, 2011 ~-~---~ - -- -----~-~~------ On October 6, 2011 , petitioner filed an administrative claim for refund or issuance of tax credit certificate with respondent in the amount of ~77,878,491.52, representing its unutilized and excess input taxes for CY 2010. 6 On October 25, 20 11, petitioner filed a clarificatory letter with respondent stating that upon review of records, / the proper amount for refund was only ~62,066,592.88. 7 lei' 3 Exhibit "A". 4 Exhibit " C". 5 Exhibits " D" , " E", " F" and " G" . 6 Exhibits "I" and "I -1 ". 7 Exhibit "J".

� Decision C.T.A. CASE NO. 8436 On March 2, 2012, petitioner filed the instant Petition for Review citing respondent's inaction on its claim for refund or tax credit. On March 29, 2012, respondent filed her Answer8 stating among others, that petitioner's claim is subject to routinary examination. There is however no showing that it submitted complete documents to substantiate the same contrary to its allegation warranting its denial by inaction. For lack of substantiation, petitioner's claim for refund/tax credit is pro-forma, hence, should be deemed not filed. Without the pre-requisite administrative claim for refund, the Court cannot entertain the present petition for lack of jurisdiction. Finally, like tax exemptions, claims for refund are construed strictissimi juris against the claimant and liberally in favor of the taxing authority. 9 After the pre-trial conference, the parties filed their Joint Stipulation of Facts and Issues10 dated May 11, 2012, which the Court approved on June 15, 2012. 11 To prove its case, petitioner presented witnesses Ma. Teresa De Leon, Chito Padie and Atty. Maria Myla Maralit. Witness Ma. Teresa S. De Leon, petitioner's Finance Coordinator since October 2010, identified her Judicial Affidavie 2 dated August 13, 2012, declaring that petitioner is licensed by SEC13 to do business in the Philippines as a regional operating headquarter (ROHQ) and a registered VAT taxpayer with Tax Identification No. 201-056-391- 000.14 She testified that petitioner incurred input VAT credits on its purchase of goods and services in connection with the services it rendered in the Philippines as a shared services center to clients, all of which are its affiliates doing business / 8 Docket, vol. 1, pp. 31-39. 9 Commissioner of Internal Reven ue vs. Procter and Gamble Philippines Manufacturing Corporation, 204 SCRA 37 7 10 Docket, vol. 1, pp. 66-70. 11 Docket, vol. 1, p. 72-73 . 12 Exhibit "FF" and "FF-1 " . 13 Exhibits "A" and "B" . 14 Exhibit "C".

Decision C.T.A. CASE NO. 8436 outside the Philippines. Petitioner's purchases of goods and services include, among others, office supplies, janitorial and guard services, consultancies, rentals on its office space, furniture and fixtures, as evidenced by VAT invoices and VAT official receipts. She further testified that petitioner has excess and unutilized input VAT for the four quarters of CY 2010 in the amount of P62,066,592.88, which it carried over to the succeeding quarters15 until the same was deducted as "VAT Refund/TCC Claimed" from the total input VAT in the Quarterly VAT Return for the 4th Quarter of CY 2011. 16 In view thereof, petitioner, on October 6, 2011, filed with the BIR Large Taxpayer's Excise Audit Division 2 an administrative claim for refund of its unutilized input VAT for the four quarters of CY 2010, 17 which was followed by a clarificatory letter filed on October 25, 2011. 18 However, respondent failed to act on the said claim for refund/tax credit. As petitioner's Finan ce Coordinator, she reviewed the !CPA's report and all the documents supporting the present claim for refund 19 su ch as schedules of official receipts, invoices and other accou nting records. 20 She added that petitioner had a temporary holding account in its General Ledger called the "Capex-Ciearing" (Account No. 89981000 ) wherein each transaction upon receipt of an invoice was recorded. After the system migration in September 2008 , the said account was mapped to "Settlement to WIP " Account (Account No. 81901300). 21 Under this account, bal ances are transferred to either an Asset Under Construction (AUC) Account22 or to a Fixed Asset Account, 23 dependin g on the nature of the Capital Expenditure at month -e nd or before the books are closed. 15 Exhibit s " H" to " H-3" . / 16 Line 23D of Exhib it " H-3 ". 17 Exhibits "I " and " 1- 1" . 18 Exhibits " J" and " J-1" . 19 Exhibits " SS" and " SS-1". 20 Exhibits " SSSSS " , "I I I I I ", " UUU UU", " VVVVV ", " WWWWW " , " XXXXX", "YYYYY", "ZZZZZ", " AAAAAA" and "CCCCCC". 21 Exhibit " MM ". 22 Exhibit " NN ". 23 Exhib it " 00 ".

Decision C.T.A. CASE NO. 8436 On petitioner's purchases of capital goods reported in its quarterly VAT Returns for 1st to 4th quarters of 2010 in the total amount of P140,036,597.75/4 the witness clarified that the amount pertaining to these purchases subject to VAT were initially recorded in the Capex Clearing Account then in the Settlement to WIP Account after the system migration, while the VAT on capital purchases are recorded under General Ledger Account No. 17100100 and described as "VAT on Capital Purchases"25 � The second witness Chito R. Padie, also executed a Judicial Affidavit dated September 13, 2012, 26 in which he stated that as petitioner's Interim Optimization Manager, he is familiar with the present claim for refund/tax credit. The subject input VAT was incurred by petitioner in the course of rendering services in the Philippines, as a shared services center, to clients engaged in business conducted outside the country. He explained that petitioner acts as a shared services center and as such, offers finance, human resources, information technology and procurement services to its affiliates located and conducting business outside the Philippines, such as in Africa, Europe, the Asia Pacific and America, as evidenced by relevant incorporation papers, 27 the Service Agreements, 28 Chevron Group of Companies' In line Reports, 29 as well as in the Certifications of Non- Registration of Corporation/Partnership executed by Mr. Benito A. Cataran of the SEC. 30 Petitioner also provides ad hoc services to its foreign affiliates that are not covered by Service Agreements. In turn, petitioner charges all its affiliates the total cost of services plus an agreed markup cost for both regular and ad hoc services which are paid in U.S. dollars and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas. 7 On cross-examination, witness Padie clarified that although he became the Interim Optimization Manager 24 Exhibits "D" to " G" 25 Exhibit "PP". 26 Exhibits "GG" and " GG -1". 27 Exhibits "N " to "N-14 ", " N-16 " to " N-27" . 28 Exhibits " L" to "L-12" . 29 Exhibits "0" to "AA''. 30 Exhibits " K" to "K-48 " .

Decision C.T.A. CASE NO. 8436 on May 2012, he began his employment with petitioner as early as 2000 and was part of the Optimization Group as a Team Leader before his promotion in 2012. His predecessor explained to him petitioner's present action including all the relevant files, which he himself reviewed. Further, he opined that petitioner is entitled to its claim for refund/tax credit since as a ROHQ that services affiliates doing business outside the Philippines, petitioner incurred input VAT for all its purchases while its revenue came from zero-rated sales. He proceeded to say that his department is a sub-group of Finance under Finance and Accounting and as an Interim Optimization Manager, he reports directly to the General Manager. He is in-charge of managing petitioner's corporate compliance and oversees the budgeting process as well as the performance reporting of petitioner. In her Judicial Affidavit dated November 28, 2012, 31 Independent Certified Public Accountant (ICPA), Atty. Maria Myla S. Maralit, declared that she prepared a report on her findings and conclusions after audit relative to petitioner's claim for refund/tax credit on November 22, 201232 and a Supplemental Report on November 26, 2012. 33 Per her analysis, petitioner has sufficient excess input VAT from periods prior to CY 2010 to cover its output VAT liabilities arising from the 1st quarter of CY 2010 until the 4th quarter of CY 2010 without need to utilize the input VAT in the amount of P62,066, 592.88, which is the subject of the present claim. Thus, the input VAT of P62,066,592.88 was not applied against petitioner's output VAT liabilities. Moreover, the amount of P62,066,592.88 was deducted from the amount of total available input VAT in petitioner's 4th quarter VAT Return for CY 2011, as indicated in Line 230. 34 However, based on her Supplemental Report dated / 31 Exhibits "HH" and "HH - 1". 32 Exhibits "II" and "II- 1". 33 Exhibits "JJ" and "JJ - 1". 34 Exhibit "H-3".

Decision C.T.A. CASE NO. 8436 November 26, 2012, petitioner is entitled to a total of net allowable claim for refund/tax credit attributable to zero- rated sales for the four quarters of CY 2010 in the amount of PSS, 994,019.48. 35 She further testified that her Supplemental Report covers petitioner's purchases of capital goods on November 26, 2012 supported by the additional documents provided by petitioner later. After petitioner rested, respondent filed a Manifestation on October 9, 2013, stating that she would no longer present evidence as no report of investigation in the administrative level had been submitted. 36 STATEMENT OF ISSUES The parties submitted the following issues37 for the resolution of the Court: "1. Whether or not petitioner incurred input VAT on its purchases of goods and services attributable to zero- rated sales for CY 2010 . 2. Whether or not the alleged input VAT incurred by petitioner for CY 2010 is duly supported by VAT invoices and official receipts. 3. Whether or not the alleged input VAT incurred by petition er for CY 2010 amounting to Php62,066,592.88 was applied against any output VAT or carried over to succeeding taxable periods. 4. Whether or not petitioner's administrative and judicial claims for refund or issuance of TCC for its excess and unutilized input VAT on purchases of goods and services attributable to its zero-rated sales were filed within the period prescribed under Sections 110, 112 and 229, Tax Code. / 35 Exhibit "JJ". 36 Docket, vol. 5, pp. 3542 -3 543 . 37 Stipulated Issues, Join t Stipul ation of Facts and I ssues, docket, vol. 1, p. 68.

Decision C.T.A. CASE NO. 8436 5. Whether or not the Court has jurisdiction to act on the instant Petition for Review." RULING OF THE COURT Section 112 of the NIRC of 1997, as amended, relevantly provides, thus: "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. Provided, however, That in the case of zero - rated sales under Section 106(A)(2) (a) ( 1), (2) and (b) and Section 108(B)(1) and (2), the acceptable foreign currency exchange proceeds thereof had been duly accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP): Provided, further, That where the taxpayer is engaged in zero-rated or effectively zero-rated sale and also in taxable or exempt sale of goods or 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(B)(6), the input taxes shall be allocated ratably between his zero- rated and non-zero-rated sales. Thus, to be entitled to a refund/tax credit of input VAT due or paid attributable to zero-rated or effectively zero-/

Decision C.T.A. CASE NO. 8436 rated sales, the taxpayer must satisfy the following requisites, to wit: 1. there must be zero -rated or effectively zero-rated sales; 2. that input taxes were incurred or paid; 3. that such input taxes were attributable to zero- rated or effectively zero-rated sales; 4. that the input taxes were not applied against any output VAT liability; and 5. that the claim for refund was filed within the two- year prescriptive period. Paramount for purposes of jurisdiction, is the need to determine whether the instant Petition for Review was seasonably filed . Based on the cited provis ion of Section 112 expounded in the case of Commissioner of Internal Revenue vs. Aichi Forging Company of Asia, Inc. (Aichi), 38 a VAT-registered person, such as petitioner, may within two (2) years from the close of the taxable quarter when the relevant sales were made, apply with respondent a claim for refund/tax credit of creditable input tax attributable to such sales. The present claim covers the four taxable quarters of 2010 which closed on Ma rch 31, 2010; June 30, 2010; September 30, 201 0 and Decem ber 31, 2010. Counting two years from the said dates, petitioner had until March 31, 2012; June 30, 2012; Septem ber 30, 2012 and December 31, 2012, respectively, within which to file its administrative claim for refund or issuance of tax credit certificate. Clearly, petitioner's administrative claims for refund were seasonably filed on October 6, 2011, as sho wn below: / 38 G.R. No. 184823 , Octobe r 06, 201 0 .

Decision C.T.A. CASE NO. 8436 Taxable Close of Expiration Actual date of quarter of taxable date of 2-year filing of 2010 quarter 2010 period to file refund claim administrative claim 1st quarter March 31, 2010 March 31, 2012 2nd quarter 3rd quarter June 30, 2010 June 30, 2012 4th quarter September 30, September 30, October 6, 2011 2010 - �- - 2012 -� - December 31, December 31, 2010 -2-0-12 Section 112 (C) further provides that respondent has one hundred twenty (120) days to act on the claim. In case of adverse decision or expiration of the period granted, the taxpayer has thirty (30) days from notice of the adverse decision or expiration of the one hundred twenty-day (120) period to appeal the decision or the inaction of respondent to the Court of Tax Appeals, thus: "SEC. 112.Refunds or Tax Credits of Input Tax. - 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." v'

Deci sion C.T.A. CAS E NO. 843 6 Page 11 of 4 0 Applying the foregoing provision in the present case, respondent had 120 days from the date of petitioner's submission of complete documents on October 6, 2011 or until February 3, 2012, within which to grant or deny petitioner's claim for refund/tax credit. Since the 120-day period lapsed without any action on the part of respondent, petitioner had 30 days or until March 5, 2012 to seek judicial intervention. Evidently, the instant Petition for Review was timely filed on March 2, 2012, over which the Court acquired jurisdiction. Respondent, however, argues that there is no showing that petitioner submitted complete documents to substantiate its administrative claim for refund. That being the case, its application for refund/tax credit is pro -forma, and should be deemed not filed. Consequently, the Court cannot acquire jurisdiction over the petition since no valid application for refund/tax credit was filed before her office. Evidence, however, shows the contrary particularly petitioner's supplemental letter explaining the unintentional overstatement in its administrative claim for refund / 9 in this wise: "The following supporting documents for the instant tax refund claim as prescribed by Revenue Memorandum Order 73 -98 are already submitted last October 6, 2011: 1. Application for Tax Credit/Refund (BIR Form No. 1914) 2. SEC Certificate of Registration as amended 3. Chevron 's Articles of Incorporation 4. BIR Certificate of Registration (BIR Form No . 2303) 5. Annual Income Tax Return for taxable year 2009 (BIR Form No. 1702) j 6. Quarterly VAT returns for taxable year 2010 (BIR Form No. 2550Q) 7. Monthly VAT returns for taxable year 2010 (BIR Form No. 2550M) 39 Exh ibits "1-1" a nd "J".

Deci si on C.T. A. CAS E NO. 8436 Page 12 of 4 0 8. Audited Financial Statements for year ended December 31, 2010 9. Certificate of Inward Remittance from JP Morgan Chase Bank N.A. 10. Summary List of Purchases 11. Certification showing amount of zero- rated sales, taxable sales and exempt sales. As held in the consolidated cases of Team Sua/ Corporation (formerly: Mirant Sua/ Corporation) vs. Commissioner of Internal Revenue, and Commissioner of Internal Revenue vs. Team Sua/ Corporation (formerly Mirant Sua/ Corporation),40 the completeness of documents to support a claim is determined by the taxpayer and not by the BIR whose duty under Section 112(C) of the NIRC of 1997 is to act on the claim within the allowable period of 120-day period from the date of submission of complete documents. Moreover, there is nothing in the record that shows that respondent required or even notified petitioner of the need to submit additional documents for purposes of the administrative claim for refund/tax credit and that the latter failed to comply. Hence, the 120-day period started and continued to run from October 6, 2011, when petitioner filed its application for refund/tax credit with respondent in consonance with Revenue Memorandum Circular No. 029-09 which reads as follows: "III. Period within which Refund or Tax Credit of Input Taxes shall be Made Section 112 (C) of the Tax Code of 1997, as amended by Republic Act No. 9337, provides among others, that in proper cases, the Commissioner shall grant a refund or issue the tax credit certificate (TCC) for creditable input taxes within one hundred twenty {120) days from the date of submission of complete documents. For the purpose of defining 'proper __c_~ses' in the said provision, the taxpayer/claimant/ �4 CTA EB Nos. 649 and 6 51, Resolution dat ed Ma rch 21 , 20 12.

Deci sion C. T .A . CAS E NO. 843 6 Pag e 13 of 4 0 must have complied with the following conditions/requirements upon audit/verification of his/its claim: a. Submission of complete documents necessary to determine and/or ascertain the correctness of the return and the amount to be refunded/credited; XXX XXX XXX In cases where taxpayer failed to comply with the above conditions/requirements, i.e., failure to present accounting books and records for audit/verification, additional documents to explain discrepancies/findings are not submitted, taxpayer refuses or incurs delay in the submission of the Agreement Form, the running of the 120-day period shall stop from the date of notification to the taxpayer. Likewise, the running of the 120-day period shall be suspended in case a question of law arises during the conduct of audit/verification and/or review of the claim for tax refund/credit, and the issue is referred to the Legal Division or the Legal Service, as the case may be, for resolution and issuance of legal opinion, which should be rendered within thirty (30) working days from receipt of the request. (Emphasis supplied) More importantly, non-submission of complete documents at the administrative level is not fatal to a claim for refund in the judicial level. As held in Commissioner of Internal Revenue vs. Toledo Power Company41, viz: "In a VAT refund case such as the present case, the alleged non-submission of complete documents at the administrative level is not fatal to a claim for refund in the judicial level as held in several CTA En Bane cases one of which / 41 CTA EB No . 589, Resolution dated January 12, 201 1.

Deci sion C.T.A. CAS E NO . 843 6 Page 14 of 4 0 is Commissioner of Internal Revenue vs. CE Luzon Geothermal Power Company, Inc. It will not bar the CTA from receiving, evaluating, and appreciating evidence submitted before it. Once the claim for refund has been elevated to the CTA, the admissibility, materiality, relevancy, probative value and weight of evidence presented therein become subject to the Rules of Court. The question of whether or not the evidence submitted by a party is sufficient to warrant the granting of a claim for refund lies within the sound discretion and judgment of the Court." (Emphasis supplied) On the other requisites, petitioner maintains that the services it renders to its affiliates located and doing business outside the Philippines are subject to zero percent (0�/o) VAT pursuant to Section 108(8)(2) of the NIRC of 1997, as amended, which provides as follows: "SEC. 108.Value-added Tax on Sale of Services and Use or lease of Properties. - XXX XXX XXX (B) Transactions Subject to Zero Percent (0�/o) Rate. - The following services performed in the Philippines by VAT-registered persons shall be subject to zero percent (0�/o) rate: (1) Processing, manufacturing or repacking goods for other persons doing business outside the Philippines which goods are subsequently exported, where the services are paid for in acceptable foreign currency and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP)." (2) Services other than those mentioned in the preceding paragraph rendered to a person engaged in business conducted outside thy

Deci sion C.T. A. CAS E NO . 843 6 Page 15 of 4 0 Philippines or to a nonresident person not engaged in business who is outside the Philippines when the services are performed, the consideration for which is paid for in acceptable foreign currency and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP). In the case of Commissioner of Internal Revenue vs. Burmeister and Wain Scandinavian Contractor Mindanao, Inc., 42 the Supreme Court declared that for the supply of services to be VAT zero-rated under Section 108(8)(2) of the NIRC of 1997, as amended, the following requisites must concur: 1. the services must be other than processing, manufacturing or repacking of goods; 2. the payment for such services must be in acceptable foreign currency accounted for in accordance with the BSP rules and regulations; and 3. the recipient of such services must be doing business outside the Philippines. Undisputedly, petitioner is a VAT-registered taxpayer with Tax Identification Number 201-056-391-000. It is licensed to do business as a ROHQ in the Philippines by the SEC pursuant to the Omnibus Investments Code of 1987, as amended by Republic Act No. 8756 and its implementing rules and regulations, particularly, to engage in general administration and planning; business planning and coordination; sourcing/procurement of raw materials and components; corporate finance advisory services; marketing control and sales promotion; training and personnel management; logistics services; research and development services and product development; technical support and maintenance; data processing and communication; and business development. To be sure, the services enumerate/ -�-- 42 G.R. No . 153 20 5, January 22, 2007 .

Deci sion C.T. A. CAS E NO . 843 6 Page 16 of 4 0 do not fall in the category of "processing, manufacturing or repacking of goods". Anent the second requisite, Section 113 (A)(2), (8)(1), (2)(c) and (3) of the NIRC of 1997, as amended, and as implemented by Section 4.113-1 (A)(2), B(1) and (2)(c) of Revenue Regulations (RR) No. 16-05, provide that a VAT taxpayer, like petitioner, shall for every lease of goods or properties and for every sale, barter or exchange of services, issue a VAT official receipt with the following information as herein provided: "SEC. 113. Invoicing and Accounting Requirements for VAT-registered Persons. - (A) Invoicing Requirements. A VAT- registered person shall issue: XXX XXX XXX (2) A VAT official receipt for every lease of goods or properties, and for every sale, barter or exchange of services. (B) Information Contained in the VAT Invoice or VAT Official Receipt. - The following information shall be indicated in the VAT invoice or VAT official receipt: (1) A statement that the seller is a VAT- registered person, followed by his Taxpayer's Identification Number (TIN); (2) The total amount which the purchaser pays or is obligated to pay to the seller with the indication that such amount includes the value- added tax: Provided, That: XXX XXX XXX (c) If the sale is subject to zero percent (0�/o) value -added tax, the term 'zero-rated sale' v shall be written or printed prominently on the / invoice or receipt;

Deci sion C. T .A. CAS E NO . 84 36 Pag e 17 of 4 0 XXX XXX XXX (3) The date of transaction, quantity, unit cost and description of the goods or properties or nature of the service; and" (Emphases supplied) "SEC. 4.113 - 1. Invoicing Requirements. - (A) A VAT- registered person shall issue: - XXX XXX XXX (2) A VAT official receipt for every lease of goods or properties, and for every sale, barter or exchange of services. Only VAT- registered persons are required to print their TIN followed by the word 'VAT' in their invoice or official receipts. Said documents shall be considered as a 'VAT Invoice' or 'VAT official' receipt . All purchases covered by invoices/receipts other than VAT Invoice/VAT Official Receipt shall not give rise to any input tax. VAT invoice/official receipt shall be prepared at least in duplicate, the original to be given to the buyer and the duplicate to be retained by the seller as part of his accounting records. (B) Information contained in VAT invoice or VAT official receipt. - The following information shall be indicated in VAT invoice or VAT official receipt: ( 1) A statement that the seller is a VAT- registered person, followed by his TIN; (2) The total amount which the purchaser pays or is obligated to pay to the seller with the indication that such amount includes the VAT ~ / Provided, That: c/ XXX XXX XXX

Deci sion C. T .A. CAS E NO . 84 36 Pag e 18 of 4 0 (c) If the sale is subject to zero percent (0�/o) VAT, the term 'zero-rated sale' shall be written or printed prominently on the invoice or receipt;" (Emphases supplied) Pursuant to the foregoing provisions, the foreign currency remittances referred to under Section 108(8)(2) of the NIRC of 1997, as amended, must likewise be supported by VAT zero-rated official receipts. Evidence shows that for services rendered for the four taxable quarters of CY 2010, petitioner received US dollar payments with the peso equivalent of F>1,902,437,672. 79, which were accounted for in accordance with the BSP rules and regulations, as evidenced by the bank certification of inward remittances43 issued by JP Morgan Chase Bank N.A and duly supported by VAT zero-rated official receipts44 issued by petitioner to its client-affiliates. However, a comparison of the amounts of zero-rated receipts as reflected in the VAT zero-rated official receipts (ORs) and as declared in petitioner's Quarterly VAT Returns indicates a discrepancy of P81,781.68, as shown below: Zero - rated Receipts per Quarterly VAT P1,902,437,672. 79 Returns15 1, 902,355,891.11 Zero - rated Receipts per ORs Difference p 81,781.68 Since the amount of P81, 781.68 is not covered by VAT zero-rated official receipts, the same shall be denied VAT zero-rating. Moreover, the Court noted that petitioner's declared zero-rated receipts in the amount of P205,247.85 ($4,439.57) 46 which though supported by VAT zero-rated I 43 Ex hibits " III" to " III-4 " , " JJJ " to " JJJ- 3", " KKK " to " KKK - 4 ", and "LLL" to "LLL- 4 ". 44 Exhibit s " EEE" to " EEE-46 " , " FFF" to " FFF-10 5", " GGG " to " GGG-50 ", and " HHH " to "HH H- 93". 45 Exhibi ts " D", "E", " F", and " G". 46 Exh ibit " BBB" .

Decision C.T.A. CASE NO . 8436 ORs do not have corresponding foreign currency inward remittances, to wit: Name of Affiliate OR No. Payment Sales Sales 2751 Date (in USD) (in Php) Chevron (China) Investment Co. Ltd (Exh. "III- 1 ") 25 -Jan - 10 4 436.18 205,093.85 Chevron Texaco Malampaya LLC 2506 Total 23 -Apr-10 3.39 154.00 (Ex h . "JJJ-16") 4,439.57 205,247.85 To prove that its client-affiliates are non-resident foreign corporations doing business outside the Philippines, petitioner presented Certifications of Non-Registration of Corporation/Partnership issued by the Philippine Securities and Exchange Commission, Service Agreements, Memorandum/Articles of Association, Certificate of Incorporation/Registration, Articles of Merger, Certificate of Change of Name and Incorporation, Inline Report of the Corporate Profile, and printed screenshots of the United States SEC website for company filings of Chevron Corporation, enumerated as follows: SEC Certificate of Non-Registration of Company Exhibit Client "K" Chevron Products Company "K- 1" Chevron Services Company "K- 2" Cabinda Gulf Oil Company Limited "K-3" Chevron Corporation "K-4" Chevron Canada Limited - Downstream Branch "K-5" Chevron Australia Pty Ltd-Other "K-6" Chevron Munaigas Inc.-Home Office "K- 7" Chevron Global Upstream and Gas "K-8" Chevron U.S.A. Inc.(Singapore Branch) "K-9" Chevron Information Technology Company "K- 10" Chevron North Sea Limited "K-11" Chevron U.S. A. Inc.-Shipping Branch "K- 12" CUSA- Giobal Lubricants Asia Pacific "K-13" Chevron Global Downstream "K-14" Chevron Marine Products LLC-Int'l "K- 15" Chevron Global Technology Services Co. -Global Gas Branch "K-16" CGE1-Giobal Downstream Cost Allocation "K- 17" Chevron Asia Pacific Holdings Branch "K- 18" Chevron Labuan Limited "K-19" Chevron Global Energy Inc. j "K-20" Chevron Overseas Services Corporation

Decision C.T.A. CASE NO. 8436 "K-21" Chevron International Pte Ltd "K- 22" Chevron China Limited Chevron AI Khalij, A Branch of Chevron Asia Pacific "K-23" Holdings, Limited "K- 24" Chevron Lubricants Lanka Pic "K- 25" Chevron (Cambodia) Limited "K-26" Chevron Demark Inc.-Denmark Branch "K- 27" PT Chevron Oil Products Indonesia "K-28" Chevron Singapore Pte. Ltd. "K-29" Chevron Trading Pte. Ltd. "K- 30" Star Holdings Company Ltd. "K-31" Chevron South Africa (Pty) Limited "K- 32" Chevron Africa - Pakistan Services Pty Ltd. "K-33" Chevron (China) Investment Co. Ltd. "K-34" Chevron (Tianjin) Lubricants Co., Ltd. "K- 35" Chevron Lubricants Vietnam Ltd. "K-36" Chevron Holdings Inc.-Taiwan "K-37" Talcor Pty. Limited "K- 38" Chevron Hong Kong Limited "K-39" Chevron Malaysia Limited "K-40" Asia Pacific Marine Services (EF) B.V. "K-41" Chevron New Zealand "K-42" Chevron Pakistan Limited-Branch "K-43" Chevron (Thailand) Limited "K-44" Chevron (LAO) Limited "K-45" Chevron Kuo Pte. Ltd. "K-46" Chevron Limited Europe Mktg-Aviation "K-47" Chevron Products Company-EWA Trading "K-48" Chevron Products UK Limited Corporate Groups Service Agreement Exhibit Client "L" Chevron Services Company "L- 1" Chevron U.S.A. Inc., (Singapore Branch) Chevron Lanka Lubricants PLC [formerly, Caltex Lubricants "L- 2" Lanka Ltd.] Chevron (Cambodia) Limited [formerly, Caltex Cambodia "L-3" Ltd.] PT Chevron Oil Products Indonesia [formerly, PT Caltex Oil "L-4" Indonesia] Chevron Singapore Pte. Ltd [formerly, Caltex Singapore "L-5" Pte. Ltd.] Chevron (China) Investment Co. Ltd [formerly, Caltex "L-6" (China) Investment Company Limited] Chevron (Tianjin) Lubricants Co., Ltd. [formerly, Caltex "L-7" (Tianjin) Lubricant Company Limited] Chevron Hong Kong Limited [formerly, Caltex Oil Hong "L-8" Konq Limited] "L-9" Chevron Malaysia Limited [formerly, Caltex Oil Malaysia /

Decision C.T.A. CASE NO. 8436 "L- 10" Limited] "L-11" "L-12" Chevron New Zealand ffo rm erly Caltex New Zealand Ltd.l Chevron Pakistan Limited Branc h [formerly, Caltex Oil (Pakistan) Ltd .1 Chevron (Thailand) Limited [formerly, Ca ltex Oil (Thailand) Limited] Printed screenshots of the U. S. Securities and Exchange Commission's website pertaining to Chevron Corporation's records which listed, among others, the following (Exhibit "M") : State, Province or Country in Which Name of Subsidiary Organized Beta Offshore Nigeria Deepwater Limited Nigeria Cabinda Gulf Oil Company Limited Bermuda Chevron and Gulf UK Pension Plan Trustee Company Limited England Chevron Argentina S.R.L. Argentina Chevron Australia Pty Ltd. Australia Chevron Australia Transport Pty Ltd. Australia Chevron (Bermuda) Investments Limited Bermuda Chevron Brasil Petroleo Limitada Brazil Chevron Canada Capital Company Nova Scotia Chevron Canada Finance Limited Ca nada Chevron Canada Funding Company Nova Scotia Chevron Canada Limited Canada Chevron Capital Corporation Delaware Chevron Caspian Pipeline Consortium Company Delaware Chevron Environmental Management Company California Chevron Funding Corporation Delaware Chevron Geothermal Indonesia, Ltd. Bermuda Chevron Global Energy Inc. Delaware Chevron Global Power Company Pennsylvania Chevron Global Technology Services Company Delaware Chevron Global Upstream and Gas Pennsylvania Chevron International (Congo) Limited Bermuda Chevron International Petroleum Company Delaware Chevron Investment Management Company Delaware Chevron Investments (Netherlands) Inc. Delaware Chevron LNG Shipping Company Limited Bermuda Chevron Marine Products LLC Delaware Chevron Mining Inc. Missouri Chevron New Zealand New Zealand Chevron Nigeria Deepwater B Limited Nigeria Chevron Nigeria Deepwater D Limited Nigeria / Chevron Nigeria Limited Nigeria

Decision Bermuda C.T.A. CASE NO. 8436 Delaware Page 22 of 40 Singapore France Chevron Oil Congo (D.R.C.) Limited Delaware Chevron Oronite Company LLC Bermuda Chevron Oronite Pte. Ltd. Bahamas Chevron Oronite S.A. Bahamas Chevron Overseas Company Bahamas Chevron Overseas (Congo) Limited Bahamas Chevron Overseas Petroleum Limited Chevron Overseas Pipeline (Cameroon) Limited Chevron Overseas Pipeline (Chad) Limited Chevron Pakistan Limited Memorandum/Articles of Association, Certificate of Incorporation/Registration and other documents Exhibit Documents I Certificate of Incorporation of Chevron Overseas Services "N" Corporation Increase of Par Value Share Capital of Chevron Africa - "N - 1" Pakistan Services (Pty) Ltd Memorandum and Articles of Association of Chevron "N-2" (Cambodia) Limited "N-3" Constitution of Talcor Pty. Limited "N - 4" Charter of Chevron Lubricants Vietnam Limited "N-5" Memorandum of Association of Chevron Pakistan Limited Memorandum and Articles of Association of Chevron "N - 6" (Lao) Ltd. ! "N - 7" Articles of Association of Chevron South Africa Pty Ltd Certificate of Change of Name and Incorporation of "N-8" Chevron Malaysia Limited Circular Resolution in Lieu of the General Meeting of "N - 9" Shareholders of P.T. Chevron Oil Products Indonesia Certificate of Amendment of Certificate of Incorporation and By- Laws of Chevron Global Technology Services ! "N-10" Company Articles of Merger I Consolidation and By-Laws of "N-11" Chevron U.S.A. Inc. Certificate of Continuance of Chevron Asia Pacific "N - 12" Holdings Limited "N- 13"1"N- Articles of Merger-Domestic Business Corporation of 15" Chevron U.S.A. Inc. "N - 14" Certificate of Incorporation of Chevron Gamma Limited Articles of Association of Chevron (China) Investment "N-16" Co., Ltd. Certificate of Change of Name and Incorporation of "N - 17" Chevron (Thailand) Limited Chevron Asia Pacific Holdings Limited's Registration I "N - 18" Renewal Certificate of a Foreiqn Branches Company "N-19" Certificate of Registration of Chevron Australia Pty Ltd "N - 20" / Certificate of I'lcorporation of Chevron Global Energy Inc. "N-21" Memorandum and Articles of Association of Chevron

Decision C.T.A. CASE NO. 8436 Hong Kong Limited "N - 22" Articles of Association of Lanka Lubricants Limited "N-23" "N-24" Articles of Association/Certificate of Incorporation of "N - 25" Chevron New Zealand "N-26" "N-27" Articles of Association of ChevronTexaco North Sea "0" Limited "0-1" Articles of Merger - Domestic Business Corporation of "0-2" "0-3" Chevron USA Inc. "0-4" "0-5" Memorandum and Articles of Association of Chevron "0-6" Singapore Pte Ltd "0 - 7" "0-8" Articles of Association (By-Laws) of Star Holdings "P" Company Limited "Q" "R" Inline Report of the Corporate Profile of Chevron U.S.A. "Su "S - 1" Inc. "T" "U" Legal Structure of Chevron U.S.A. Inc. "U - 1" Certification issued by the Department of Treasury - I Internal Revenue Service of Philadelphia that Chevron I "U-2" "V" U.S.A. Inc . is a U.S. corporation and a resident of the U.S.A. for purposes of U.S. taxation Inline Report of the Corporate Profile of Chevron Upstream and Gas as of August 1, 2012 In line Report of the Corporate Profile of Chevron Global Upstream as of August 1, 2012 Inline Report of the Corporate Profile of Chevron Global Gas as of August 1, 2012 In line Report of the Corporate Profile of Chevron Services Company as of August 1, 2012 In line Report of the Corporate Profile of ChevronTexaco Global Lubricants as of August 1, 2012 In line Report of the Corporate Profile of Chevron Products Company as of August 1, 2012 Inline Report of the Corporate Profile of Chevron Holdings Inc. as of August 1, 2012 In line Report of the Corporate Profile of Chevron Canada Limited as of August 1, 2012 In line Report of the Corporate Profile of Chevron Limited as of August 1, 2012 Inline Report of the Corporate Profile of Chevron Corporation as of August 1, 2012 Restated Certificate of Incorporation of Chevron Corporation In line Report of the Corporate Profile of Chevron Munaigas Inc. as of August 1, 2012 Inline Report of the Corporate Profile of Chevron Global Downstream LLC as of August 1, 2012 Certificate of Amendment of Name from ChevronTexaco Global Downstream to Chevron Global Downstream LLC Amended and Restated Limited Liability Company Agreement of Chevron Global Downstream LLC Inline Report of the Corporate Profile of Chevron Labuan Limited as of August 1, 2012 /

Decision C.T.A. CASE NO. 8436 Certificate of Incorporation on Change of Name of Offshore Company from Caltex Labuan Limited to "V- 1" Chevron Labuan Limited In line Report of the Corporate Profile of Chevron "W" International Pte. Ltd. as of August 1, 2012 Certificate Confirming Incorporation of Company Under "W-1" the New Name of Chevron International Pte Ltd Certificate of Incorporation on Change of Name of Company from Caltex Services Pte Ltd to Caltex "W- 2" International Pte Ltd Memorandum and Articles of Association of Caltex "W-3" Services Pte Ltd In line Report of the Corporate Profile of Chevron China "X" Limited as of August 1, 2012 In line Report of the Corporate Profile of Chevron Trading "Y" Pte. Ltd. as of August 1, 2012 Certificate Confirming Incorporation of Company under "Y-1" the new name of Chevron Trading Pte. Ltd. Memorandum and Articles of Association of Caltex "Y- 2" Trading Pte Ltd nzu Inline Report of the Corporate Profile of Chevron (Tianjin) Lubricants Co._l Ltd. Amendment to the Articles of Association of Chevron "Z-1" (Tianjin) Lubricants Co. Ltd. Inline Report of the Corporate Profile of Asia Pacific "AA" Marine Services (EF) B.V. as of August 1, 2012 Inline Report of the Corporate Profile of Chevron Kuo Pte. "BB" Ltd. as of August 1 2012 In line Report of the Corporate Profile of Chevron "CC" Denmark Inc. as of August 1, 2012 In line Report of the Corporate Profile of Chevron Products "DO" UK Limited as of August 1, 2012 In line Report of the Corporate Profile of Chevron Marine ��-~~~� ____ .. - - ~roduc:ts LL~~? _Q_f Al!gust 1, 2012 Each of the enumerated documents, standing alone, is inadequate proof that petitioner's client-affiliates are non- resident foreign corporation doing business outside the Philippines. While the SEC Certificates of Non-Registration show that the entities named therein are not registered corporations/partnerships in the Philippines, the same do not prove that such entities are non-resident foreign corporations doing business outside the Philippines. Likewise, the Service Agreements only indicate the names and addresses of petitioner's customers to whom it rendered services but the same do not establish that such customers are non-resident foreign corporations conducting business outside the Philippines. The same with the Articles of Association, Articles/Certificate of Incorporation, Inline /

Decision C.T.A. CASE NO. 8436 Report of the Corporate Profile, and printed screenshots of the United States SEC website for company filings of Chevron Corporation which only prove that the entities named therein were incorporated or organized abroad but not the fact that they are not doing business in the Philippines. To be considered as a non-resident foreign corporation doing business outside the Philippines, each entity must be supported at the very least by both SEC Certificate of Non- Registration of Corporation/Partnership and Memorandum/Articles of Association, Certificate of Incorporation/Registration, Articles of Merger, Certificate of Change of Name and Incorporation, Inline Report of the Corporate Profile or printed screenshots of US SEC website showing the state/province/country where the entity was organized. Thus, only the following client-affiliates of petitioner shall be considered as non-resident foreign corporations doing business outside the Philippines: Memorandum/ Articles of Association, Certificate of Included in the list of Incorporation/ Registration, Articles Subsidiaries of Chevron of Merger, Certificate of Change of Corporation (Exhibits "M") SEC Name and Incorporation, Inline Certificate y Report of the Corporate Profile Exhibit y Client "K-2" Exhibit Documents "K-33" "N - 14" Certificate of Incorporation v' Cabinda Gulf Oil Co. "K-44" "N-16" of Cabinda Gulf Oil Company Ltd "K-43" "N-6" Limited .... / "N - 17" Articles of Association of Chevron (China) "K- 34" Chevron China Investment Investment Co. Ltd "ZII Co. Ltd. "K-3 2 " "Z-1" Memorandum and Articles of Chevron (Lao) Ltd "K- 5" "N-1" Association of Chevron Lao "K- 25" "N - 19" Limited Chevron (Thailand) "N - 2" Certificate of Change of Limted Name and Incorporation of Chevron Thailand Limited Chevron (Tianjin) In line Report of the Lubricants Co. Corporate Profile of Chevron Tianjin Lubricants Co Ltd Chevron Africa - Amended to the Articles of Pakistan Services Association of Chevron Chevron Australia Pty Tianjin Lubricants Co Ltd Ltd Increase in Par Value Share Capital of Chevron Africa Chevron Cambodia Pakistan Services Pty Ltd Limited Certificate of Registration of Chevron Australia Pty Ltd Memorandum and Articles of Association of Chevron Cambodia

Decision C.T.A. CASE NO . 84 36 Chevron China Ltd "K- 22" "X" Inline Report of the Chevron Corporation "K- 3" "511 Corporate Profile of Chevron "S- 1" China Limited Chevron Global "K-1 3" Inline Report of the Downstream LLC null Corporate Profile of Chevron Corporation Chevron Global "K- 19" "U - 1" Restated Certification of y Energ__y: Inc. "K-38" Incorporation of Chevron "U- 2" Corporation v' Chevron Hong Kong "N -2 0 " Inline Report of the y Ltd "N- 21" Corporate Profile of Chevron Global Downstream LLC v Chevron International "K - 21" ~~w " Certificate of Amendment of Pte Ltd Name of Chevron Global "W- 1" Downstream LLC Chevron Kuo Pte Ltd "K-45" Amended and Restated Chevron Lubricants "K - 35" "W- 2" Limited Liability Company Vietnam Ltd "W-3" Agreement of Chevron "K-39" "BB" Global Downstream LLC Chevron Malaysia "K-41" "N - 4" Certificate of Incorporation Limited "K-4 2" of Chevron Global Energy "N-8" Inc. Chevron New Zealand "Kn "N - 23" Memorandum and Articles of Chevron Pakistan "N - 5" Association of Chevron Hong Limited "N - 15" Kong Limited "0 -8" Inline Report of the Chevron Products "0 - 6" Corporate Profile of Chevron Company International Pte Ltd Certificate Confirming Chevron Services "K- 1" Incorporation of Company Company under the new name of Chevron International Pte Ltd Certificate of Incorporation on change of name of company of Chevron International Pte Ltd Memorandum and Articles of Association of Chevron International Pte Ltd In line Report of the Corporate Profile of Chevron Kuo Pte Ltd Charter of Chevron Lubricants Vietnam Limited Certificate of Change of Name and Certificate of Incorporation of Chevron Malaysia Limited Articles of As sociation of Chevron New Zealand Memorandum of Association of Chevron Pakistan Limited Certificate of Incorporation for Caltex Oil Products Company Inline Report of the Corporate Profile of Chevron Products Company Inline Report of the Corporate Profile of Chevron Services ConlJ:Ji=li'!Y

Decision C.T.A. CASE NO. 8436 Chevron Singapore "K- 28" "N - 26" Memorandum and Articles of Pte Ltd "K-31" "N - 7" Association of Chevron Chevron South Africa Sinqapore Pte Ltd Pty Ltd Articles of Association of Chevron South Africa Pty Ltd Chevron Trading Pte "K- 29" "Y" Inline Report of the Ltd Corporate Profile of Chevron "K - 30" "Y- 1" Trading Pte Ltd Star Holdings "K- 37" "Y- 2" Certificate Confirming Company Ltd "N - 27" Incorporation of Company Talcor Pty Ltd "N - 3" under the new name of Chevron Trad ing Pte Ltd Memorandum and Articles of Association of Chevron Trading Pte Ltd Articles of Association of Star Holdings Company Limited Constitution of Talcor Pty Limited Accordingly, petitioner's receipts derived from services rendered to the above-enumerated entities for CY 2010 in the amount of f'>1,409,155,838. 78 shall be subject to zero percent VAT pursuant to Section 108(8)(2) of the NIRC of 1997, as amended. Below is the breakdown of the said amount: OR Name of Affiliate Sales (in Sales (in Php) Exhibit No. OR Date USD) First Quarter of 2010 JANUARY Chevron Lubricants 864.43 p 39,927.48 "EEE- 2" 2752 22-Jan - 10 Vietnam Ltd 657,732.98 2753 25-Jan-10 Chevron Services 328 570.67 30 171 237.61 "EEE- 3" 2755 25-Jan- 10 Company 254,856.66 2756 25-Jan- 10 Chevron Global 122,541.09 15 072 049.08 "EEE- 5" 2757 25-Jan-10 Downstream 121 044.30 2758 25-Jan - 10 Chevron 103,619.56 11,690,672.48 "EEE - 6" 2759 25-Jan-10 International Pte Ltd 2763 27-Jan-10 Chevron Australia 4 675.77 5,621,150.92 "EEE-7" Pt'}' Ltd Chevron New 5 552 490.83 "EEE- 8" Zealand Chevron (Thailand) 4,753 190.83 "EEE-9" Limited 216 170.60 "EEE - Chevron Pakistan 13" Limited FEBRUARY 04-Feb- Chevron Africa - "EEE- Pakistan Services 15" 2765 10 Chevron Products 155 153.26 7 176 376.50 Company 545,590.64 25,270 525.24 "EEE - 27 - Feb - 16" 2780 10 w

Decision C.T.A. CASE NO. 8436 2767 23-Feb- Chevron New 250,417.49 11,550,622.23 " EEE- 2770 10 Zealand 1 031,878.74 471508 1229.28 18" 2772 Chevron Services 12 037 421.27 2773 27 - Feb- Company 261 452.79 "EEE - 2774 10 Chevron Singapore 205 859.62 9 14 7 7 18 8 3 . 0 6 21" 2776 Pte Ltd 130 513.59 6 008 912.98 2778 27-Feb- Chevron Hong Kong 103 173.36 4 750 154.70 "EEE- 2779 10 Ltd 151,185.15 6 19 4 7 1 8 4 6 . 9 7 23" Chevron Global 1 604 715.07 27-Feb- Downstream 34 918.60 "EEE- 10 24" Chevron Corporation 27 - Feb- Chevron Malaysia "EEE - 10 Limited 25" Chevron Cambodia 27-Feb- Limited "EEE- 10 27" 27-Feb- "EEE- 10 29" 27 - Feb- "EEE - 10 30" MARCH 25- Mar- Chevron Services "EEE - Company 32" 2781 10 Chevron Products 993 776.76 34 726 687.67 Company 760 514.46 45 315 857.73 "EEE- 12-Mar- Chevron New 291 052.71 13 271 897.40 34" Zealand 272 797.99 12 439 488.83 2784 10 Chevron 179,729.94 "EEE - International Pte Ltd 1491303.99 8,195,619.70 36" 25- Mar- Chevron (Thailand) 148 078.16 6 808 207.48 Lim ted 146,543.62 6 752,310.08 "EEE - 2786 10 Chevron Hong Kong 1031290.06 6,682,335.61 37" Ltd 108 592.00 4 17091989.06 25 - Mar- Chevron Global 4 963 071.30 "EEE- Downstream p 349, 315,041.99 38" 2787 10 Chevron Products Company "EEE - 25-Mar- Cabinda Gulf Oil Co. 39" Ltd 2788 10 Chevron Malaysia "EEE - Limited 40" 25 - Mar- "EEE- 41" 2789 10 "EEE - 43" 25 -Mar- "EEE- 46" 2790 10 25-Mar- 2791 10 25- Mar- 2793 10 26-Mar- 2796 10 sub- total Second Quarter of CY 2010 APRIL Chevron New 151 332.00 p 6 713,930.79 "FFF-4" 2805 23-Apr-10 Zealand 66 177.38 2807 23-Apr- 10 Chevron Trading Pte 44,031.28 2 935 997.34 "FFF- 6" 2808 23-Aj2r-10 Ltd 40 146.82 2809 23-Apr- 10 Cabinda Gulf Oil Co . 13,724.23 1 953 472.94 "FFF-7" 2811 23 -Apr- 10 Ltd 5,702.43 Chevron 5 548.31 1 781,136.65 "FFF- 8" International Pte Ltd 608,883.32 "FFF- Chevron (China) 361,317.43 252 991.57 10" Investment Co. Ltd 353,290.77 246 153.95 "FFF- 166 845.50 11" 2812 23-Apr-10 Chevron Kuo Pte Ltd 16 015,843.53 "FFF - 2814 23-Apr- 10 Chevron Global 15 660,051.86 13" 2818 26-Apr- 10 Enerqy Inc. "FFF- 2819 26-Apr-10 Chevron Services 7 395 633.87 17" 2821 26 -Apr:-_t() Company "FFF - Chevron Global 18" Downstream "FFF- Chevron South 20" 6fric_a p_ty__1t_d /

Decision C.T.A. CASE NO . 8436 2823 26-Apr- 10 Chevron Products 89,726.70 3,977,247 .34 "FFF- 28 24 26-Apr-10 Companl' 88,778.79 3 935 230.05 22" 2825 26-Apr- 10 Chevron Hong Kong 77 371.22 3 429 575.35 "FFF - 2827 26-Apr-10 Ltd 34 340.27 1 522 175.09 23" Chevron Malaysia 32 045.48 1 420 455.67 "FFF- Limited 24" Chevron Africa - 7 027.94 311 522.16 "FFF- Paki stan Services 1,832.84 81,242.91 26" 1 522.07 67 467.64 "FFF- 2828 26-Apr-10 Chevron Corporation 40 019.50 27 " 2836 26-Apr- 10 Chevron Cambodia 902.84 "FFF- 2842 26-Apr-10 Limited 81,009.61 3,587 670.95 35" Chevron Global 67 470.31 2 988 056.24 "FFF- Down stream LLC 41" 4,164.59 184,764.42 "FF F- 2845 26-Apr- 10 Chevron (Lao) Ltd 701,184.70 31,108 460.51 44" "FFF- 2847 26-Apr- 10 Chevron China Ltd 653 944.58 46" Star Holdings 998 224.33 "FFF- 2850 27-Apr- 10 Company Ltd 159,394.12 49" Chevron (Thailand) 259,678.18 "FFF- 2851 27-Apr- 10 Limted 151 363 .24 50" Chevron Australia 142,790.64 "FFF- 2815 23 -Apr- 10 Pty Ltd 106 838.95 57 " Chevron Products " FFF- 2799 19-Apr-10 Com12any 659,951.97 61" 1 014 213.70 MAY 18- May- Chevron Products 29 510 134.48 "FFF- 2865 10 Company 158,637.83 46 493 913.83 72" 2868 Chevron Services 143 589.60 " FFF- 2869 25- May- Company 198 015.89 7,424,039.12 73" 2871 10 Chevron Hong Kong 157,259.44 12 094 931.53 "FFF- 28 7 2 Ltd 74 " 2873 25-May- Chevron New 4 871.21 7 049,987.89 " FFF- 2875 10 Zea land 157,331.24 6,650J05.17 76" Chevron Singapore 260,171.67 4 978 515.84 "FFF- 25- May- Pte Ltd 163 672.76 77" 10 Chevron Global " FFF- Downstream 78" 25-May- Chevron Malaysia "FFF- 10 Limited 80" 25-May- Chevron Products 10 Com12ant: Chevron Services 26- May- Company 10 Chevron Global Downstream J UNE Chevron Products Company 2885 17-Jun-10 Chevron 3 0 , 6 5 2 16 6 9 . 3 0 "FFF- International Pte Ltd 46 502,232 .92 87" 2886 25-Jun - 10 Chevron Singapore "FFF- Pte Ltd 7, 273,628.15 88" 2889 25-Jun- 10 Star Holdings 6 583 658.87 "FFF- Company_Ltd 9 079,132.97 94" 2896 25-Jun-10 Chevron Hong Kong 7,210,428. 24 " FFF- Ltd 95" 2899 25-Jun- 10 Chevron New 223 347.55 "FFF- Zealand 7,213,720.31 96" 2891 25-Jun-10 Chevron (Thailand) 11,929,008. 25 " FFF- Lim ted 7 504,482.35 97" 2895 25 -Jun - 10 " FFF- 98" 2890 25-Jun - 10 "FFF- 99" 2887 25-Jun-10 " FFF- 100" 2888 25-Jun - 10 " FFF- 101"

Decision C.T.A. CASE NO. 8436 2901 28-Jun - 10 Chevron Global 916.41 42,211.42 "FFF- 2900 28-Jun-10 Energy Inc. 105,270.85 102" Chevron Malaysia 4,848 956.70 "FFF- Limited p 359,483,688.54 103" sub-total Third Quarter of CY 2010 JULY 01 -Jul - 10 Chevron (Tianjin) 18,811.15 p 873,312.44 "GGG - 1" 2904 13-Jul-10 Lubricants Co. 21,854.50 2905 15-Jul - 10 Chevron South 110091912.20 "GGG-2" 2906 23-Ju l-10 Africa Pty Ltd 1 320.28 61 039.30 "GGG - 3" 2909 26-Jul - 10 143,504.35 2910 26 -Jul - 10 Ta lcor Pty Ltd 712 471.45 6 668 417.75 "GGG-6" 2911 26-Jul -10 Chevron New 334,336.89 2916 26 -Jul - 10 Zealand 33 153 627.27 "GGG - 7" 2917 23-J ul - 10 Chevron Services 1,027.55 2918 20-Jul-10 Company 6 096.51 15,557,789.20 "GGG - 8" 2921 Chevron Global 255,251.48 47,815.26 "GGG - Downstream 707 382.00 13" Chevron Cambodia 283 690.55 "GGG- Limited 11 861 128.25 14" Chevron (China) 32 825 150.81 "GGG- Investment Co. Ltd 15" Chevron "GGG - International Pte Ltd 18" Chevron Products Company AUGUST 17-Aug - Chevron Products "GGG - Company 20" 2923 10 Chevron Africa - 654 133.66 29 572 046.11 Pakistan Services 168,579.11 7,597,075.71 "GGG- 24-Aug- Chevron (Thailand) 124,350.85 5 603,913.93 23" Limited 1 276 161.78 2926 10 Chevron South 28 318.03 "GGG - Africa Ptv Ltd 1 013 122.25 45,595,060.76 24" 24-Aug - Chevron Services 11 706 791.63 Company 260 124.91 "GGG- 2927 10 Chevron New 199 191.27 8 964 503.60 25" Zealand 161,185.10 7 254 054.91 24-Aug- Chevron Hong Kong 150 197.44 6 759 560.76 "GGG- Ltd 145 787.11 6 561 076.06 26" 2928 10 Chevron Singapore Pte Ltd 261 947.18 "GGG - 25-Aug- Chevron Global 149,544.27 28" Downstream 134 961.57 2929 10 Chevron Malaysia 654,288.26 "GGG- Limited 992,520.75 29" 25-Aug - 204 274.25 Chevron New "GGG- 2931 10 Zealand 30" Chevron Singapore 25-Aug- Pte Ltd "GGG - Chevron 31" 2932 10 International Pte Ltd Chevron Products "GGG- 25-Aug- Company 32" Chevron Services 2933 10 Company Chevron Global 25-Aug - Downstream 2934 10 25-Aug- 2935 10 SEPTEMBER 24-Sep- "GGG- 37" 3057 10 11 493 952.61 6 561 837.21 "GGG - 24-Sep- 5 921 964.46 38" 3058 10 28,989,289.32 "GGG - 43 550 713.03 39" 24-Sep- 8 963 328.21 "GGG- 3059 10 41" 20-Sep- "GGG - 42" 3061 10 "GGG- 27 - Sep - ~ 44" 3062 10 27 - Sep - 3064 10

Decision C.T.A. CASE NO. 8436 3065 27-Sep- Chevron Hong Kong 156,582.86 6,870,682. 76 "GGG- 3068 10 Ltd 104,809.07 4,598 906.10 45" 3078 Chevron Malaysia 149 506 .57 6 560 182.97 27 - Sep - Limited p 356,742,984.95 "GGG - 10 Chevron Products 48" Company 27-Sep- "GGG- 10 49" sub-total Fourth Quarter of CY 2010 OCTOBER Chevron 2531570.33 p 10,962,833.12 "HHH-4" 3085 22-0ct-10 International Pte Ltd 518 619.39 22 335 029.72 "HHH - 3091 26-0ct-10 Chevron Services 335 191.86 14 435 480.62 10" 3092 26-0ct- 10 Company 219,123.00 "HHH- 3093 26-0ct-10 Chevron Global 9,436,821. 71 11" 3098 26-0ct-10 Downstream 94 588.91 4 073 596.47 "HHH- 3099 26-0ct- 10 Chevron New 78 780.74 3,392 796.73 12" 3100 26-0ct-10 Zealand 64 517.19 2 778,518.09 "HHH - 3101 26-0ct- 10 Chevron (Thailand) 60 319.04 2,597 719.21 17" 3102 26-0ct- 10 Lim ted 59,466 .51 2,561,003.88 "HHH- 3103 26-0ct-10 Cabinda Gulf Oil Co. 58,609.13 2 524,079.67 18" 3104 26-0ct- 10 Ltd 49 068.72 2 113 209.30 "HHH - 3107 26-0ct- 10 Chevron Trading Pte 29,963.90 1,290,434.97 19" Ltd 12,282.51 "HHH - Chevron Products 528,962.53 20" Company 8 747.43 376,719.64 "HHH- Chevron Singapore 71218.89 310 891.04 21" Pte Ltd 2 394.26 103,111.97 "HHH - Star Holdings 1 675.53 22" Company Ltd 116 889.77 72 158.91 "HHH - Chevron 5,034,012.49 23" International Pte Ltd 37.27 "HHH- Chevron Australia 1 605.08 26" Pt}" Ltd 152 839.07 "HHH - 148 752.52 31" 3112 26-0ct-10 Chevron Kuo Pte Ltd 104,809.07 "HHH- 3114 26-0ct- 10 Chevron Global 988 529.32 33" 3115 26-0ct-10 Energy Inc. 259,139.80 "HHH- 3119 26-0ct-10 Chevron Hong Kong 133,818.03 34" 3123 26-0ct- 10 Ltd "HHH - Chevron Cambodia 38" Limited "HHH- Chevron Malaysia 42" Limited "HHH - 48" 3129 26-0ct-10 Chevron Corporation "HHH - i Chevron Australia 49" 3130 26-0ct- 10 Pty Ltd NOVEMBER Chevron Hong Kong Ltd 23 - Nov- Chevron Singapore "HHH - Pte Ltd 55" 3136 10 Chevron Malaysia 6,671 281.97 Limited 6,492 907.90 "HHH- 23-Nov- Chevron Services 4,609,018.03 56" Company 43 490 071.27 3137 10 Chevron New 11,400,783.11 "HHH - Zealand 5,887,286.85 57" 26- Nov- Chevron Global Downstream "HHH - 3138 10 59" 24- Nov- "HHH- 61" i 3140 10 "HHH - 24-Nov- 762" 3142 10 24- Nov- 3143 10

Decision C.T.A. CASE NO. 8436 24-Nov- Chevron "HHH- 63" 3144 10 International Pte Ltd 128,848.63 5,668,659.48 "HHH- DECEMBER 6,941,103.52 67" 58,914 498.47 02-Dec- Chevron Africa - 10 077 946.93 "HHH - Pakistan Services 72" 3148 10 Chevron Products 157,563.05 6,999,724.90 1,343,839. 71 6 995,547.10 "HHH - 21 - Dec- Com~ 4 454 753.21 73" 227 862.38 44 588 123.61 3153 10 Chevron New 158,263.78 16 973 435 .75 "HHH- Zealand 158 169.32 6 967 285.46 74" 21 - Dec- Chevron Hong Kong 100 721.97 6 267 068.92 Ltd 1 002,786.90 1 299,680.41 "HHH - 3154 10 Chevron (Thailand) 381 732.57 2,053,720.83 75" Lim ted 156 694.25 1 215,864.38 2 1-Dec- Chevron 140 946.38 " HHH- International Pte Ltd 716 376.05 77" 3155 10 Chevron Services 29,320.79 p 343[614,123.30 Company 46,640.00 P1,409, 155,838.78 "HHH- 21 - Dec- Chevron Australia 27 612.28 78" Pty Ltd 16 268.90 3156 10 Chevron Global "HHH - Downstream 80" 21-Dec- Chevron Products Company "HHH- 3158 10 Chevron (Tianjin) 81" Lubricants Co. 22-Dec- Chevron South "HHH - Africa Pty Ltd 82" 3159 10 Chevron (Tianjin) Lubricants Co. "HHH - 22- Dec- Chevron (China) 85" Investment Co. Ltd 3161 10 "HHH- 86" 22-Dec- "HHH - 3162 10 87" 22- Dec- "HHH - 88" 3163 10 23- Dec- 3166 10 28-Dec- 3167 10 28- Dec- 3168 10 28- Dec- 3169 10 sub-total Total Valid Zero-Rated Sales for the 1st, 2nd, 3rd and 4th quarter of CY 2010 On the other hand, the amount of P492,994,804.48, as computed below, shall be denied VAT zero-rating for petitioner's failure to prove that the entities to which it rendered services are non-resident foreign corporations doing business outside the Philippines. Zero- Rated Receipts Per Returns f> 1,902,437,672.79 Less: Valid Zero-Rated Receipts 1,409,155,838.78 Disallowed Zero-Rated Receipts 493,281,834.01 Less: Not covered by ORs 81,781.68 Without corresponding foreign 205,247.85 currency remittances Remaining Disallowed Zero-Rated p 492,994,804.48 Receipts With the finding that petitioner has valid VAT zero- rated sales for the four quarters of CY 2010 amounting to / P1,409,155,838.78, the Court needs to determine the

Decision C.T.A. CAS E NO . 8436 amount of input VAT paid or incurred which are attributable to VAT zero-rated sales. As earlier mentioned, petitioner reflected a total amount of P67,393,501.98 allowable input VAT in its Quarterly VAT Returns for CY 2010, to wit: Particulars I Input VAT p 16,920,216.87 Amortization of Input Tax on Capital Goods 105,834.35 exceeding P1 Million 2,121,501.94 Purchase of Capital Goods not exceeding 82,720.00 P1 Million 37,827,421.11 10,335,807.71 Domestic Purchase of Goods (other than Capital P67,393,501.98 Goods) Importation of Goods other than Capital Goods Domestic Purchase of Services Service Rendered by Non-Residents Total Available Input Tax In support of its reported input VAT of P67,393,501.98, petitioner presented various invoices, official receipts, Import Entry and Internal Revenue Declarations (IEIRDs), BIR Form No. 1600 and other documents which were all examined by the ICPA. The Supplemental ICPA Report dated November 26, 2012, 47 summarized the total amount of input VAT for the four quarters of CY 2010 supported by valid documents, the total amount of input VAT supported by documents with noted exceptions, and the total amount of input VAT not claimed by petitioner and thus, not subjected to review. The total amount of P67,393,501.98 input VAT is broken down as follows: Particulars Amount Total Input VAT supported by valid documents per review f' 60,613,396.97 Total Input VAT supported by documents with noted exceptions per review 6,558,483.60 Total Input VAT not claimed and not subjected for review (Total Input VAT per 2010 Quarterly VAT Returns less 221,621.41 In put VAT covered by documents submitted for review) P67,393,501.98 Total Input VAT per Quarterly VAT Returns (four quarters of CY 2010) / 4 7 Exhibit " JJ".

Decision C.T.A . CASE NO. 8436 The input VAT in the amount of P6,558,483.60 shall be disallowed from petitioner's claim as they are not properly substantiated by VAT invoices or receipts as prescribed under Sections 110(A) and 113(A) and (B) of the NIRC of 1997, as amended, in relation to Sections 4.110-1, 4.110-8, and 4.113-1 of Revenue Regulations No. 16-05. The said amount is broken down as follows: Exceptions Exhibit Total AMORTIZATION OF INPUT TAXES ON CAPITAL GOODS EXCEEDING Pl MILLION a. Goods supported with official receipts "I I I I I" to p 1,303.39 "I I I I 1-2" "UUUUU" to b. Services supported with invoice "UUUUU-36" 1, 755,866.18 c. Goods supported with documents other "VVVVV" to than an invoice "VVVVV- 5" 34,783.61 d. Services supported with documents "WWWWW" to other than an official receipt "WWWWW-3" 661,070.86 e. Supported with zero-rated invoice or "XXXXX" to official receipt "XXXXX- 1" 40,661.73 f. Supported with documents without "YYYYY" t o 77,983.69 authority to print "YYYYY-9" "ZZZZZ" to g. Supported with photocopy of documents "ZZZZZ- 3" 3,610.25 h. Supported with documents dated out of "AAAAAA" to the calendar year "AAAAAA- 26" 287,373.26 i. Over- claimed VAT "SSSSSS" 23,052 .38 j. Unsupported "CCCCCC" 890,990 . 22 Total Disallowed Amortization of Input p 3,776,695.57 Taxes on Capital Goods Exceeding 1 Million INPUT TAXES ON PURCHASES OF CAPITAL GOODS, GOODS (OTHER THAN CAPITAL GOODS) AND SERVICES First Quarter "CCCC" to p 964.29 a. Domest ic purchases of goods supported "CCCC- 3" "DDDD" to 2,123.62 by invoices without authority to print "DDDD-1" b. Domestic purchases of goods supported "EEEE" to 46/834.53 "EEEE - 14" by photocopied VAT invoice only "FFFF" to 14,614.29 c. Domestic purchases of goods supported "FFFF-10" "GGGG" to 230 158.03 by invoices dated out of the CY 2010 "GGGG - 3" d. Domestic purchases of services 1,080.00 "HHHH" to supported by invoices only "HHHH - 2" 7 214.2 e. Domestic purchases of services wi t h "IIII" to other documents as support "IIII-4-4" f. Domestic purchases of services support ed by ORS without authority to print g. Domestic purchases of services supported by provisional receipts only

Decision "JJJJ" to 1 651,518.30 C.T.A. CAS E NO. 8436 "JJJJ-65" Page 35 of 40 26,678.57 "KKKK" to 120,248.82 h. Domestic purchases of services "KKKK-3" p 2,094,434.73 supported by official receipts dated out of the CY 2010 "LLLL" p 1,011.87 i. Domestic purchases of services also " MMM M" to 13.26 claimed as support for input VAT from "MMMM-15" 707.13 purchase of capital goods not exceeding P1 million "NNNN" to 84.43 "NNNN-1" j. Domestic purchases of services without "0000" to 3,739.15 supporting documents "0000-4" 5.36 "PPPP" to Subtotal - First Quarter "PPPP-1 II 36,708.70 164,739.86 Second Quarter "RRRR" to a. Domestic purchases of goods with official "RRRR-1" 6,480.00 128.06 receipts as support only "QQQQ" b. Domestic purchases of goods supported p 213,617.82 "SSSS" to by documents other than official "SSSS-8" receipts/invoices "TTTT" to c. Domestic purchases of goods supported "TTTT-11" by invoices without authority to print d. Domestic purchases of goods supported "UUUU" to by invoices dated out of the CY 2010 "UUUU-1" e. Domestic purchases of goods also claimed as support for input VAT from "VVVV" purchase of capital goods not exceeding P1 million f. Domestic purchases of goods without supporting documents g. Domestic purchases of services supported by official receipts without authority to print h. Domestic purchases of services supported by provisional receipt only i. Domestic purchases of services supported by official receipts dated out of the CY 2010 j. Domestic purchases of services without supporting documents Subtotal - Second Quarter Third Quarter "WWWW" to p 428.23 a. Domestic purchases of goods 'Nith official "WWWW-11" 79,848.82 receipt as support only "XXXX" to b. Domestic purchases of goods supported "XXXX-3" 124.91 by invoices without authority to print ''YYYY'' 169,764.77 c. Domestic purchases of goods wi t hout "ZZZZ" to "ZZZZ-8" 882.36 supportinq documents "AAAAA" to d. Domestic purchases of services with "AAAAA-2" 46,391.27 invoice as support only "BBBBB" to 9,000.00 e. Domestic purchases of services "BBBBB-11" "-/ supported by non - VAT off icial receipts "CCCCC" to f. Domestic purchases of services "CCCCC- 1" supported by official receipts without authority to print g. Domestic purchases of services supported by photocopied VAT official receipts only

Decision "EEEEE" to 89,479.16 C.T.A. CASE NO. 8436 "EEEEE-12" Page 36 of 40 6 183.84 "FFFFF" p 402,103.36 h. Domestic purchases of services supported bz:: provisional receipt only i. Domestic purchases of services without supporting documents Subtotal -Third Quarter Fourth Quarter "GGGGG" to a. Domestic purchases of goods supported "GGGGG-2" p 675.00 by invoices without authority to print 964.28 b. Domestic purchases of services "JJJJJ" to 1/419.86 3,024.00 supported by invoices only "JJJJJ-2" c. Domestic purchases of services with 26,703.22 "KKKKK" to 38,333 .57 other document as support d. Domestic purchases of services "KKKKK-5" 512.82 71,632.75 supported by nob-VAT official receipts "LLLLL" to e. Domestic purchases of services "LLLLL-1" supported by official receipts without authority to print "MMMMM" to f. Domestic purchases of services "MMMMM-10" supported by provisional receipt "00000" to g. Domestic purchases of services without "00000-4" supporting documents "PPPPP" Subtotal - Fourth Quarter p Total Disallowed Input Taxes on Purchases of Capital Goods, Goods p 2,781,788.66 (Other than Capital Goods) and Services Grand Total - Disallowed Input VAT I I P6,558,484.2348 On account of the aforesaid disallowances, the Court finds that only the amount of ~60,613,396.97 is duly substantiated, out of the total allowable input VAT per Quarterly VAT Returns in the amount of ~67,393,501.98, detailed as follows: Particulars Exhibit Total AMORTIZATION OF INPUT TAXES ON CAPITAL GOODS EXCEEDING Pl MILLION First Quarter p 3,072,342. 99 Second Quarter "SSSSS" to 3,133,076.05 I Third Quarter "SSSSS-601 II 3,266,554. 76 Fourth Quarter 3,449,926.10 TOTAL I P12,921,899.90 / 48 Difference of P0.63 (P6,558,483.60 minus P6,558,484.23) is due to rounding-off.

Decision C.T.A. CASE NO. 8436 INPUT TAXES ON PURCHASES OF CAPITAL GOODS, GOODS (OTHER THAN CAPITAL GOODS) AND SERVICES First Quarter Purchases of goods supported "UUU" to "UUU-42" p 197,828.70 by valid VAT Invoices Purchases of services supported by valid VAT Official Receipts "VVV" to "VVV- 326" 7,081,404.89 Subtotal - First Quarter -p 7,279,233 . 59 Second Quarter "WWW" to "WWW-88" p 448,847.89 Purchases of goods supported "XXX" to "XXX-394" by valid VAT Invoices 10,353,825.85 Purchases of services supported "P10,802, 673 .74 by valid VAT Official Receipts Subtotal - Second Quarter Third Quarter "YYY" to "YYY-68" p 365,465.43 Purchases of goods supported "ZZZ" to "ZZZ-343" by valid VAT Invoices 9,440,839.80 Purchases of services supported p 9,806,305.23 by valid VAT Official Receipts Subtotal - Third Quarter Fourth Quarter "AAAA" to "AAAA-88" p 407,675 .71 Purchases of goods supported "BBBB" to "BBBB-375" by valid VAT Invoices 8,977,081.09 Purchases of services supported p 9 , 384, 756.80 by valid VAT Official Receipts Subtotal - Fourth Quarte r TOTAL "P37, 272, 969 .3 6 C. INPUT TAXES ON IMPORTATION OF GOODS (OTHER THAN CAPITAL GOODS) Duly supported with IEIRD and BPI Settlement Advice Third Quarter "RRRRR" to "RRRRR-7" p 75,236 .00 Fourth Quarter "RRRRR-8" 7,484.00 TOTAL p 82,720.00 D. INPUT TAXES ON PURCHASES OF SERVICES RENDERED BY NON- RESIDENTS Duly supported with BIR Form No. 1600 and e-payment First Quarter "'100rQ-1" to "QQQQQ-1" p 376,406.71 Second Quarter "QQQQQ-2" to "QQQQQ-3" 2,505,664.99 Third Quarter "QQQQQ-4" to "QQQQQ-6" 3,847,752 .34 Fourt h Quarter " JOOrQ-7" to "QQQQQ-9" 3,605,983.67 T OTAL P10, 335,807. 71 GRAND TOTAL I I "P60,61.3, 396.9 7 tl

Decision C.T.A . CASE NO. 8436 Since petitioner failed to submit the VAT invoices/receipts that will prove the existence of its reported input VAT carry-over from previous year in the amount of F>337,044,902.44,49 offsetting of its output VAT liability for CY 2010 in the amount of F>18, 741,363.64 against the valid input VAT of F>60,613,396.97 is in order, resulting in an excess input VAT of only F>41,872,033.33, computed as follows: 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Total (in Pesos) (in Pesos) (in Pesos) (in Pesos) (in Pesos) Amortization of Input Tax on Capital Goods Exceeding P1 Million 3,072 342.99 3,133,076.05 3,266,554. 76 3,449 926.10 12,921 899.90 Purchases of Capital Goods Not Exceeding P1 Million, Goods other Than Capital Goods and Services 7 279 233.59 10 802,673.74 9,806 305.23 9 384 756.80 37,272 969.36 Importation of Goods Other Than Capital Goods - - 75 236.00 7 484.00 82 720.00 Purchases of Services Rendered by Non- Residents 376,406.71 2,505,664.99 3,847,752.34 3,605,983.67 10,335,807.71 16 441,414.78 16,995 848.33 16 448 150.57 60,613,396.97 Total Valid Input 4,645,930.00 4,658,159.20 4,866,042.02 18,741,363.64 VAT 10,727 983.29 11,795,484.78 12,337,689.13 11,582,108.55 141,872,033.33 Less: Output VAT 4,571,232.42 Excess Input VAT 6,156,750.87 Hence, for the four taxable quarters of CY 2010, only the excess input VAT of P41,872,033.33 can be attributed to the entire zero-rated receipts declared by petitioner in the amount of P1,902,437,672.79, and only the input VAT of P31,119,589.65 is attributable to the valid zero-rated receipts of P1,409,155,838.78, as computed below: 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Total P3 56 742 984.95 P3431614 123.30 P1 409 155 838./ Valid Ze ro - Rated P349, 315,041.99 P359 483,688 .54 P1,902,437,672. ~ Receipts P467,946,872.66 P482 373,663.83 Total Declared P480 156,520.24 P471t960,616.06 76.2 35 788% 71.234014% ~ Ze ro - Rated Receipts 72.750244% 76.168154% % of Valid Zero- Rated Receipts 49 Exhibit " D", Line 20A.

Decision C.T.A. CASE NO. 8436 to Total Declared p 6,156,750.87 p 11,795 484.78 p 12 337 689.13 p 11,582,108.55 p 41,872 033 .~ Ze ro - Rated P4,479,051.31 P8 984,403.00 P9,405,734.51 P8,250,400.83 P311 119,589.6 Receipts Multiplied by Excess Input VAT Excess Input VAT Attributable to Valid Zero- Rated Receipts The Court also observed that although the claimed input VAT was carried over by petitioner in its succeeding Quarterly VAT Returns,S0 the same remained unutilized until it was deducted as "VAT Refund/TCC Claimed"51 in its Quarterly VAT Return for the 4 th quarter of CY 2011. Thus, the excess input VAT of P153,234,607.4652 as of the end of the 4 th quarter of CY 2011, which was to be carried over to the succeeding 1st quarter of CY 2012, no longer included the subject claim. All stated, petitioner has sufficiently established that it is entitled to a refund or issuance of tax credit certificate corresponding to its unutilized and excess input VAT for the four taxable quarters of CY 2010 attributable to its zero- rated receipts, but in the reduced amount of P31,119,589.65. WHEREFORE, the instant Petition for Review is hereby PARTIALLY GRANTED. Accordingly, respondent Commissioner of Internal Revenue is hereby DIRECTED to REFUND or ISSUE A TAX CREDIT CERTIFICATE in favor of petitioner Chevron Holdings Inc. in the reduced amount of P31,119,589.65, representing unutilized and excess input VAT for the four taxable quarters of CY 2010 attributable to its zero-rated receipts. SO ORDERED. 50 Exhibits "H" to "H - 3". 51 Exhibit " H-3", Li ne 23D. 52 Exhibit " H-3", Line 29.

Decision C.T.A. CASE NO . 8436 We Concur: ~, ~ h~A- MA. BELEN M. RINGPIS-LIBAN Associate Justice ATTESTATION I attest 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's Division. Associ{c3te Justice Chakperson CERTIFICATION Pursuant to Section 13 of Article VIII of the Constitution, and the Division's Chairperson's Attestation, 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's Division. ~~ C.QY-~e-k .51 . JR. Jd"ANITO C. CASTANEDA<;' Acting Presiding Justice