DEUTSCHE KNOWLEDGE SERVICES, PTE LTD. v. COMMISSIONER OF INTERNAL REVENUE

Republic of the Philippines COURT Of TAX APPEAlS Quezon City FIRST DIVISION DI:UTSCHE KNOWLEDGE CTA Case No. 8243 For: Refund SERVICES PTE LTO. Members: Petitioner, -versus- DEL ROSARIO, P.J., Chairperson UY,and MINDARO-GRULl-A, Jl. COMMlSSlONER OF Promulgated: INTERNAl- REVENUE, JAN 04~~6; i 2:4~1'M� Respondent. x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x DECISlON MlNIJARO-GRULl-A, J..: This is a Petition for Review filed on March 25, 2011 by Deutsche Knowledge Services Pte Ltd. as petitioner, against Commissioner of Internal Revenue as respondent, before the Court in Division, pursuant to Section 7(a)(2) of Republic Act (RA) No. 1125, An Act Creating the Court of Tax Appeals, as amended 1, as well as Rule 4, Section 3(a)(2), in relation to Rule 8, Section 4(a) of the Revised Rules of the Court of Tax Appeals (RRCTA) 2, as amended.t:: 1 Sec. 7. Jurisdiction. -The CTA shall exercise: (a) Exclusive appellate jurisdiction to review by appeal, as herein provided: XXX XXX (2) Inaction by the Commissioner of Internal Revenue in cases involving disputed assessments, refunds or internal revenue taxes, fees of other charges, penalties in relation thereto, or other matters arising under the National Internal Revenue Code or other laws administered by the Sureau of Internal Revenue, where the National Internal Revenue Code provides a specific period for action, in which case the inaction shall be deemed a denial; XXX XXX 2 Rule 4, Sec. 3. Cases within the jurisdiction of the Court in Division. -The Court in Division shall exercise:

CTA Case No. 8243 Page 2 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR OEClSlON Petitioner seeks the refund of the amount of P58,385,248.41, allegedly representing its excess and unutilized input value-added tax (VAT) on purchases of goods and services attributable to zero-rated sales for the first quarter of calendar year 2009. Petitioner Deutsche Knowledge Services Pte Ltd. is the Philippine branch of a multinational company organized and existing under and by virtue of the laws of Singapore/ with registered office address at One Raffles Quay, #17-10 South Tower, Singapore 048583. 3 It was registered with the Bureau of Internal Revenue (BIR) on June 16, 2005 as a(, (a) Exclusive original over or appellate jurisdiction to review by appeal the following: XXX XXX (2) Inaction by the Commissioner of Internal Revenue in cases involving dis.puted assessments, 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 Internal Revenue within the one hundred eighty 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 decision 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; XXX XXX Rule 8. Sec. 4. Where to appeal; mode of appeal.- (a) An appeal from a decision or ruling or the inaction of the Commissioner of Internal Revenue on disputed assessments or claim for refund of internal revenue taxes erroneously or illegally collected, the decision or ruling of the Commissioner of Customs, the Secretary of Finance, the Secretary of Trade & Industry, the Secretary of Agriculture, and the Regional Trial Court in the exercise of their original jurisdiction, shall be taken to the Court by filing before it a petition for review as provided in Rule 42 of the Rules of Court. The Court in Division shall act on the appeal. XXX XXX 3 Par. 1, Admitted Facts, Joint Stipulation of Facts and Issues (JSFI), Docket, p. 79.

CTA Case No. 8243 Page 3 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION VAT taxpayer with Taxpayer Identification No. (TIN) 238- 763-115-000.4 Petitioner is licensed to do business as a regional operating headquarters (ROHQ) in the Philippines, engaging 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, logistic services, research and development services and product development, technical support and maintenance, data processing, and communication and business development. 5 Moreover, petitioner acts as a shared services center, which handles regional, as well as global and accounting and related controlling processes, such as accounting production work in the global general ledger in SAP, developing and operating inter-company clearing house, accounting and head office reporting for non-regulated entities and product control. 6 Respondent is the duly appointed Commissioner of the Bureau of Internal Revenue empowered to perform the duties of her office, including, among others, the duty to act upon and approve claims for refund or tax credit as provided by law. She holds office at the 5th Floor, BIR National Office Building, Agham Road, Diliman, Quezon City. Petitioner entered into several IntraGroup Service Agreements ("Service Agreements" for brevity) with its foreign clients. 7 On April 22, 2009, petitioner filed its original Quarterly VAT Return8 for the first quarter of calendar year 2009 with the BIR Revenue District Office (ROO) No. 47. On October 28, 2010, petitioner filed its Application for Taxc 4 Exhibit "B"; Par. 2, Admitted Facts, JSFI, Docket, p. 80. 5 Exhibit "A"; Par. 3, Admitted Facts, JSFI, Docket, p. 80. 6 Par. 4, Admitted Facts, JSFI, Docket, p. 80. 7 Exhibit "P" to "P-35". 8 Exhibit "C"; Par. 6, Admitted Facts, JSFI, Docket, p. 81.

CTA Case No. 8243 Page 4 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION Credits/Refunds (BIR Form No. 1914)9 and administrative claim for refund or issuance of tax credit certificate. 10 The administrative claim for refund or issuance of tax credit certificate purportedly represented the unutilized input VAT attributable to its zero-rated sales of services to its foreign clients for the first quarter of calendar year 2009. There being no action taken by respondent on petitioner's administrative claim for refund or issuance of tax credit certificate, petitioner filed the present Petition for Review before this Court on March 25, 2011. In her Answer11 filed on May 2, 2011, respondent interposed the following Special and Affirmative Defenses: "4. Petitioner's alleged claim for issuance of tax credit certificate is still subject to administrative routinary investigation/examination by the respondent~ Bureau; 5. Taxes paid and collected are presumed to have been made in accordance with law, hence, not refundable. 6. Petitioner's claim for refund or issuance of tax credit certificate in the amount of P58,385,248.41, as alleged excess and unutilized input VAT on purchases of goods and services attributable to its zero-rated sales for the 1st quarter of taxable year 2009 were not fully substantiated by proper documents, such sales invoices, official receipts and others. 7. In an action for refund/credit, the burden of proof is upon petitioner to establish its right to the claimed refund and failure to adduce sufficient proof is fatal to its claim.~ 9 The application for tax credits/refunds was filed with BIR-RDO No. 44, Exhibit "L- 1". 10 The letter claim for refund/issuance of TCC was filed with the BIR ROO No. 44, Exhibit "L". 11 Docket, pp. 48-49.

CTA CiJse No. 8243 Page 5 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR PEClSlON 8. Petitioner's sales of goods and services to various alleged clients/affiliates do not qualify as zero- rated VAT. 9. The amount subject of the claim for refund of petitioner does not pertain in full to its input VAT attributable to its zero-rated sales of goods and services for the 1st quarter of taxable year 2009. 10. Petitioner failed to comply with the substantiation requirements under Revenue Regulations No. 7-95 in relation to Section 113 and 237 of the 1997 Tax Code. 11. Petitioner failed to comply with the conditions/requirements under Section 112(C) of the 1997 Tax Code. Hence, this Honorable Court has no jurisdiction to entertain the instant case. 12. It is incumbent upon petitioner 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�. 13. Claims for refund are construed strictly against the claimant for the same partakes the nature of exemption from taxation (Commissioner of Internal Revenue vs. ~edesma, 31 SCRA 95) and as such, they are looked upon with disfavor (Western Minolco Corp. vs. Cpmmissioner of Internal Revenue, 124 SCRA 1211)." Respondent filed her Pre~Trial Brief12 on May 11, 2011; while petitioner filed its Pre-Trial Brief13 on May 19, 2011. The Pre-Trial was held on June 3, 2011. 1 ~ 12 Docket, pp. 51-53. 13 Docket, pp. 57-65. 14 Minutes of the Pre-Trial; Docket, pp. 66-67.

CTA Case No. 8243 Page 6 of 44 Deutsche Knowled~Je Services Pte Ltd. vs. CIR Ot:CISION Thereafter, as directed by the Court, tl1e parties submitted their Joint Stipulation of Facts and Issues15 on July 8, 2011 as well as their Supplen1ental Joint Stipulation of Facts and Issues16 on July 29, 2011.; which were approved by the Court in the Resolution 17 dated August 9, 2011. During trial, petitioner presented and formally offered pieces of documentary and testimonial evidence, 18 sans respondent's comment. 19 In a Resolution20 dated November 20, 2012, the Court admitted petitioner's Exhibits "A", "B", "C", "D", "E", "F", "G", "G-1", "H", "I", "J", "J-1-a", "J-1" to J-91", "J-92" to "J-286", "J-287" to "J-342", "J-343" to "J- 1521"I "J-1522" to "J-1523"f "J-1524" to "J-154-2"I "J-154-3" t o "J-1546"I "J-154-7" to J-1555"I "K"I "L"I "L-1�"f "0"I "0-1"I "0-2", "0-3"I "0-4-"I "0-5"I "0-6"I "0-7"I "0-8"I "0-9"I "0- 10", "0-12"I "0-14"I "0-15"I "0-16"I "0-17"( "0-18"I "0- 19"I "0-20"I "0-22"I "0- 24"I "0- 25"I "0- 30"I "0- 31"I 0-32"I "0-33", "0-34"I "0-35"I "0-36"I "0-37"I "0-38"I "0-39"I "0- 40", "0-44", "0-47", "0-48", ''P", "P-2", "P-3", "P-4", "P-5", "P-6"I "P-7" I "P-8" I "P-9" I "P-10" I "P-11"I "P-1�3I " "P-14"I "P- 16"1 "P-18"1 "P-20"1 "P-21", "P-22", "P-23.1", "P-23.2"1 "P- 23.3"1 "P-23.4", "P-23.5", "P-23.6", "P-24"1 "P-25"1 "P-26"1 "P-27", "P-29"I "P-32"I "P-35"I "Q"I "Q-1"I "R"I "R-1"I "R-1- a", and "R-1-b". Petitioner filed� an Urgent Motion for Leave to Present Supplemental Evidence21 on February 22 1 2013 1 praying for the following: ( 1) grant petitioner's prayer to present supplemental documentary evidence; (2) set a Commissioner's Hearing for the marking of petitione(s supplemental documentary evidence; and (3) order the deferment of the submission of the parties' respective Men1oranda. Respondent filed her Comment/Opposition (To Petitioner's Urgent Motion for Leave to Present Supplemental< 1 ~ Docket, pp. 7984. 16 Docket, pp. 88-93. 11 Docket, p. 102. 18 Formal Offer of Evidence filed on May 7, 2012, Docket, pp. 24 7-709. 19 Records Verification dated September 27, 2012, Docket, p. 715. 20 Docket, pp. 717-718. 21 Doc� ket, pp. 723-7- 29.

CTA Case No. 8243 Page 7 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Dt:CISION Evidence) 22 on April 8, 2013. In a Resolution 23 dated May 17, 2013, the Court granted petitioner's Urgent Motion for Leave to Present Supplemental Evidence and ordered the setting of Commissioner's Hearing for the marking of petitioner's supplemental documentary evidence. On July 9, 2013, petitioner filed a Supplemental Formal Offer of Evidence. 24 Respondent failed to file her Comment to petitioner's Supplemental FOE. 25 In a Resolution 26 dated November 13, 2013, petitioner's Exhibits "0-49", "0-50", "0-51", "0-52"I "0-53"I "0-54"( 0-55"I 0-56"f "0-57"f "0- 58", "0-59"( "0-60", "0-61", "0-62", "0-63", "0-64", "0- 65", "0-66", "0-67", "0-69", "0-70", "0-71", "0-72", "0- 73", and "S" were admitted; while Exhibit "0-68" was denied admission for failure to correspond with the document described in the Supplemental FOE. On December 10, 2013, 27 petitioner filed a Motion for Reconsideration28 without respondent's Comment29 � In a Resolution30 dated March 17, 2014, the Court granted petitioner's Motion for Reconsideration and admitted Exhibit "0-68". In the said Resolution, the parties were given a period of twenty (20) days from receipt of the Resolution within which to submit their respective Memoranda. Respondent filed her Memorandum31 on April 10, 2014; while petitioner filed its Memorandum (With Motion to Re- Open Trial) 32 on May 2, 2014, sans respondent's Comment, 33 for the purpose of presenting additional documentary evidence. In a Resolution 34 dated July 3, c. 2014, the Court granted petitioner's Motion to Re-Open Trial l2 Doc.ket, pp. 760-764. n Docket, pp. 769 771. 24 Docket, pp. 1170-1561. 2 ~ Records Verification dated September 18, 2013, Docket, p. 1569. 26 Docket, pp. 1573-1574. 21 Manifestation dated December 11, 2013, Docket, pp. 1575-1577. 28 Docket, pp. 15783-1587. 29 Records Verification dated February 13, 2014, Docket, p. 1598. 30 Docket, pp. 1602-1603. 31 Docket, pp. 1604-1612. 32 Docket, pp. 1618-1646. 33 Records Verification dated June 5, 2014, Docket, p. 1654. 34 Docket, pp. 1656-1658.

CTA Case No. 8243 Page 8 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Dl:CISION for the sole purpose of presenting additional documentary evidence. On August 22, 2014, petitioner filed a Motion to Admit Supplemental Formal Offer of Evidence with attached Supplemental FOE. 35 Respondent, however, failed to file her Comment on the said Motion. 36 The Court granted petitioner's Motion to Admit Supplemental Formal Offer of Evidence in a Resolution 37 dated November 6, 2014. Respondent still failed to file her Comment on petitioner's Supplemental FOE. 38 In a Resolution39 dated January 23 1 2015, the Court admitted petitioner's Exhibits "J-1556"/ "J-1557"1 "J-1558"/ "J-1559"1 "T", and "T-1". In the same Resolution, the Court declared the case submitted for decision in view of the filing of petitioner's Memorandum (with Motion to Re-Open Trial) on May 2, 2014 and respondent's Memorandum on April 10, 2014. Petitioner's documentary exhibits are as follows: Exhibit Description A Securities and Exchange Commission (SEC) Certificate of Registration and License (S.E.C. Reg. No. FS2005506950) B Bureau of Internal Revenue (BIR) Certificate of Registration dated June 16, 2005 c . Quarterly VAT Return for the 1st Quarter of calendar year (CY) 2009, filed on April 22, 2009 via the BIRrs EFPS with reference no. 100900002918295 D Quarterly VAT Return for the 2nd Quarter of CY 2009, filed on July 17, 2009 via the.c 35 Docket1 pp. 1678-1688. 36 Records Verification dated October 13, 2014, Docket, p. 1692. 31 Docket/ pp. 1696-1697. 38 Records Verification dated January 9, 2015, Docket, p. 1698. 39 Docket, p. 1702.

CTA Case No. 8243 Page 9 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION BIR's EFPS with reference no. 100900003099684 E Quarterly VAT Return for the 3rd Quarter of CY 2009 1 filed on October 191 2009 via the BIR's EFPS with reference no. 100900003288515 F Quarterly VAT Return for the 4Lh Quarter of CY 2009 1 filed on January 25 1 2010 via the BIR's EFPS with reference no. 101000003509641 G Quarterly VAT Return for the 1sL Quarter of CY 2010, filed on April 21, 2010 via the BIR's EFPS with reference no. 101000003734058 G-1 Amended Quarterly VAT Return for the 1st Quarter of CY 2010, filed on October 171 2011 via the BIR's EFPS with reference no. 101100005210798 H Quarterly VAT Return for the 2nd Quarter of CY 2010, filed on July 21, 2010 via the BIR's EFPS with reference no. 101000003951054 I Quarterly VAT Return for the 3rcJ Quarter of CY 2010, filed on October 20 1 2010 via the BIR's EFPS with reference no. 101000004171299 J Quarterly VAT Return for the 41h Quarter of CY 2010, filed on January 25, 2011 via the BIR's EFPS with reference no. 101000004425763 J-1-a Amended Quarterly VAT Return for the 4Lh Quarter of CY 2010, filed on February � 10, 2011 via the BIR's EFPS with reference no. 101100004487877 J-1 to J-91 Inward remittance advice and bank statements for the 1st quarter of CY 2009 J-92 to J-286 Service invoices relating to petitioner's zero-rated sales for the 1sl quarter of CY 2009 c..

CTA Case No. 8243 Page 10 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR. Dt:CISION J-287 to J-342 Official receipts relating to petitioner's zero-rated sales for the 1st quarter of CY 2009 J-343 to J-1521 Suppliers' invoices and suppliers' official receipts for the 1st quarter of CY 2009 J-1522 to J-1523 VAT Returns for the CY 2009 J-1524 to J-1542 Audited Financial Statements as of and for the year ended December 31, 2009 J-1543 to J-1546 Certifications issued to petitioner by the SEC and Board of Investments (BOI) certifying the registered activities of petitioner J-1457 to J-1555 BIR Form 1600 (Monthly Remittance Return of VAT and other percentage taxes withheld) J-1556 Inward Remittance with Reference No. 02RS03160017 dated March 16, 2009 for the amount of EUR5,554,074.84 (Php339,648,338.69) J-1557 Inward Remittance with Reference No. 02RS03160026 dated March 16, 2009 for the amount of EUR13,346.38 (Php816,171.18) corresponding to payments for service invoice with reference numbers 2009-SOM TMG APH0-001 (for the amount of EUR2,152.00), 2009-SOM TMG APH0- 002 (for the amount of EUR2,152.00), and INV 08-APH0-0396 J-1558 Service Invoice with Reference No. 2009- SOM TMG APH0-001 for the amount of EUR2,152.00 J-1559 Service Invoice with Reference No. 2009- . SOM TMG APH0-002 for the amount of EUR2, 152.00 K Quarterly VAT Return for the l 5L Quarter of CY 2011, filed on April 25,2011 via(

CTA Case No. 8243 Page 11 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DJ:CISION the BIR's EFPS with reference no. 101100004711772 L Administrative Claim for Refund of its L-1 unutilized input VAT for the 1sL quarter of CY 2009 dated October 27, 2010 and 0 filed with the BIRon October 28m 2010 0-1 0-2 Application for Tax Credits/Refunds (BTR Form No. 1914) for the 1st quarter of CY 0-3 2009 filed with the BIR on October 28, 0-4 2010 0-5 0-6 Authenticated Articles of Association of Deutsche Bank Aktiengesellschaft Authenticated License and Change Location issued by the Banking Department of the State of New York to Deutsche Bank AG, New York Branch Authenticated Certification from the Registrar of Companies for England and Wales that Deutsche Bank Aktiengesellschaft has established a branch and continues to maintain a branch in England and Wales Authenticated Certified True Copy of Certificate of Incorporation on Change of Name of Company from Deutsche Morgan Grenfell Asia Pacific Holdings Pte Ltd to Deutsche Asia Pacific Holdings Pte Ltd. Authenticated Certified Copy of All Historical Registered Matters pertaining to Deutsche Securities Inc. based in 11-1 Sanno Park Tower, Nagatacho 2-chome, Chiyoda-ku, Tokyo Authenticated Certificate of Registration of Oversea Company of Deutsche Bank Aktiengesellschaft, frorn the Registrar of companies Hong Kong Authenticated Business Registration (NO.D.l5.6.2.30) of Deutsche Bank(

CTA Case No. 8243 Page 12 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Ot:ClSION Aktiengesellschaft/ Filiale Jakarta from the Menteri Keuangan, Indonesia 0-7 Authenticated Certificate of Registration 0-8 of Foreign Company of Deuthsche Bank Aktiengesellschaft issued by the Acting 0-9 Registrar of Companies, Singapore 0-10 Authenticated Certificate of Incorporation 0-12 on change of Name of Deutsche Asset 0-14 Management (Asia) Limited issued by the 0-15 Assistant Registrar of Companies and 0-16 Businesses/ Singapore 0-17 0-18 Authenticated Certification from Deutsche Bank Aktiengesellschaft/ Asia Pacific Head Office in One Raffles Quay I #15-00 South Tower/ Singapore that it is a segment of Deutsche Bank Ag and that it is not a separate legal entity Authenticated Certificate of Registration of a Foreign Company of Deutsche Group Services Pty Limited (Australia) Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft/ Inlandsbank Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft/ Filiale London Certification of Non-Registration of Corporation/Partnership of Deutsche Asia Pacific Holdings Pte. Ltd. Certification of Non-Registration of Corporation/Partnership of Deutsche Group Services Pty Limited Certification of Non-Registration of Corporation/Partnership of Deutsche Securities Inc. Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft Filiale Hong Kong(.

CTA Case No. 8243 Page 13 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Dt:ClSION 0-19 Certification of Non-Registration of 0-20 Corporation/Partnership of Deutsche 0-22 Bank Aktiengesellschaft, Filiale Jakarta 0-24 0-25 Certification of Non-Registration of 0-30 Corporation/Partnership of Deutsche 0-31 Bank Aktiengesellschaft, Filiale Singapur 0-32 0-33 Certification of Non-Registration of 0-34 Corporation/Partnership of Deutsche 0-35 Asset Management (Asia) Limited 0-36 Certification of !'Jon-Registration of Corporation/Partnership of DBOI Global Services Private Limited Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft, Filiale Bangkok Certification of Non-Registration of Corporation/Partnership of DB Finance Inc. Certification of Non-Registration of Corporation/Partnership of DB Trust Company Limited Japan Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft, Filiale Prag Certification of Non-Registration of Corporation/Partnership of Deutsche Bank PBC Spolka Akcyjna Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Luxembourg S.A. Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Trust Company Americas Certification of Non-Registration of Corporation/Partnership of Deutsche Bank (China) co. Ltd., Beijing Branch.('

CTA Case No. 8243 Page 14 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR D~CISION 0-37 Certification of Non-Registration of 0-38 Corporation/Partnership of Deutsche 0-39 Bank Sociedad Anonima Espanola 0-40 0-44 Certification of Non-Registration of 0-47 Corporation/Partnership of PT Deutsche 0-48 Securities Indonesia p Certification of Non-Registration of P-2 Corporation/Partnership of DWS Holding & Service GMBH P-3 P-4 Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft, Filiale Wien from the SEC Certification of Non-Registration of Corporation/Partnership of Deutsche Bank Aktiengesellschaft, Filiale Zurich Certification of Non-Registration of Corporation/Partnership of Global Markets Centre Private Limited Certification of Non-Registration of Company of DB International (Asia) Limited IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, Asia Pacific Head office Amendment and Accession Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, New York Branch (with attached Service Agreement between the same parties) IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, Filiale London IntraGroup Service Agreement between Petitioner and Deutsche Asia Pacific Holdings Pte Ltd C

CTA Case No. 8243 Page 15 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION P-5 IntraGroup Service Agreement between P-6 Petitioner and Deutsche Group Services P-7 Pty Limited P-8 IntraGroup Service Agreement between P-9 Petitioner and Deutsche Securities Inc. P-10 P-11 IntraGroup Service Agreement between P-13 .Petitioner and Deutsche Bank P-14 Aktiengesellschaft, Hongkong Branch P-16 P-18 IntraGroup Service Agreement between Petitioner and Deutsche Bank P-20 Aktiengesellschaft Jakarta Branch IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft Singapore Branch IntraGroup Service Agreement between Petitioner and Deutsche Bank (China) Co., Ltd. IntraGroup Service Agreement between Petitioner and Deutsche Asset Management (Asia) Limited IntraGroup Service Agreement between Petitioner and DBOI Global Services Private Limited IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, Filiale Bangkok IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, Filiale Seoul Branch IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, Asia Pacific Head Office IntraGroup Service Level Agreement between Petitioner and DB Trust Company Limited Japant

CTA C&lse No. 8243 Page 16 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION P-21 IntraGroup Service Agreement between P-22 Petitioner and Deutsche Bank AG Prague P-23.1 Branch P-23.2 P-23.3 IntraGroup Service Agreement between P-23.4 Petitioner and Deutsche Bank Polska S.A. P-23.5 P-23.6 IntraGroup Service Agreement between P-24 Petitioner and Deutsche Bank AG P-25 Luxembourg Branch P-26 P-27 �IntraGroup Service Agreement between P-29 Petitioner and DWS Investment S.A. P-32 IntraGroup Service Agreement between Petitioner and Deutsche Bank Luxembourg SA IntraGroup Service Agreement between Petitioner and Deutsche Bank Re S.A. IntraGroup Service Agreement between Petitioner and Deutsche Bank Vita S.A. IntraGroup Service Agreement between Petitioner and Primelux Insurance IntraGroup Service Agreement between Petitioner and Deutsche Bank (China) Co. Ltd. Beijing Branch IntraGroup Service Agreement between Petitioner and Deutsche Bank SAE (Sociedad Anonima Espanola) IntraGroup Service Agreement between Petitioner and Deutsche Securities Indonesia IntraGroup Service Agreement between Petitioner and DWS Holding & Service GmbH Deutsche Bank List of Shareholdings 2008 IntraGroup Service Agreement between Petitioner and Deutsche Bank Aktiengesellschaft, Filiale Zurichc

CTA Case No. 8243 Page 17 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Pt:CISION P-35 IntraGroup Service between Petitioner and Deutsche Bank Al<tiengesellschaft, Q Filiale Zurich Q-1 Sworn Statement of Mr. Romeo A. De R Jesus to Questions propounded by Atty. R-1 Marvin B. Ibarra dated October 25, 2011 R-1-a Signature of Mr. Romeo A. De Jesus R-1-b T Petitioner's Independent CPA Report dated September 22, 2011 T-1 Signature of Mr. Romeo A. De Jesus Sworn Statement of Ms. Rachel Concepcion to Questions propounded by Atty. Marvin B. Ibarra dated January 27, 2012 Signature of Ms. Rachel Concepcion Supplemental Sworn Statement of Mr. Romeo A. De Jesus, Jr. to Questions Propounded by Atty. Marvin B. Ibarra dated August 6, 20 J 4 Signature of Romeo A. De Jesus, Jr. The parties submitted the following issue40 for this Court's resolution: WHETHER OR NOT PETITIONER IS ENTITLED TO THE CLAIM FOR REFUND OF OR ISSUANCE OF TAX CREDIT CERTIFICATE OF EXCESS OR UNUTILIZED INPUT VAT IN THE AMOUNT OF PHP58,385,248.41. The main issue may be broken down into the following sub-issues: a. 40 Stipulated Issues for Resolution, JSFI, Docket, pp. 81-82.

CTA C"se No. 8243 Page 18 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION A. WHETHER OR NOT PETITIONER INCURRED INPUT VAT ON ITS PURCHASES OF GOODS AND SERVICES ATIRIBUTABLE TO ZERO-RATED SALES FOR THE 1ST QUARTER OF CY 2009. B. WHETHER OR NOT THE AMOUNT OF PHP58,385,248.41, BEING CLAIMED BY PETITIONER AS UN UTILIZED INPUT VAT PAID, FOR THE 1sT QUARTER OF CY 2009, PERTAINS IN FULL TO ITS ZERO-RATED SALES OF GOODS AND SERVICES. C. WHETHER OR NOT PETITIONER HAD ZERO- RATED SALES DURING THE 1sT QUARTER OF CY 2009, THE CONSIDERATION FOR WHICH IS PAID FOR IN ACCEPTABLE FOREIGN CURRENCY AND ACCOUNTED FOR IN ACCORDANCE WITH THE RULES AND REGULATIONS OF THE BSP. D. WHETHER OR NOT THE INPUT VAT INCURRED BY PETITIONER FOR THE 1sT QUARTER OF CY 2009 IS DULY SUPPORTED BY VAT INVOICES AND OFFICIAL RECEIPTS. E. WHETHER OR NOT THE INPUT VAT INCURRED BY PETITIONER FOR THE 1sT QUARTER OF CY 2009 AMOUNTING TO PHP58,385,248.41 WAS APPLIED AGAINST ANY OUTPUT VAT OR CARRIED OVER TO SUCCEEDING TAXABLE PERIODS. F. 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 CAPITAL GOODS, NON-CAPITAL GOODS AND SERVICES ATIRIBUTABLE TO ITS ZERO-RATED SALES WERE FILED WITHIN THE TWO-YEAR PERIOD PRESCRIBED UNDER SECTIONS 110, 112 AND 229, TAX CODE. G. WHETHER OR NOT PETITIONER HAS COMPLIED WITH THE INVOICING REQUIREMENTS PRESCRIBED UNDER REVENUE REGULATIONS NO. 7�- 95 IN RELATION TO SECTIONS 113 AND 237 OF THE TAX CODE.(

CTA Case No. 8243 Page 19 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION H. WHETHER OR NOT PETITIONER HAS COMPLIED WITH THE REQUIREMENTS UNDER SECTION 112(A)(B)(C) OF THE TAX CODE. Petitioner alleges that during the first quarter of calendar year 2009, it rendered services in the Philippines to persons engaged in business conducted outside the Philippines, the payments for which were made in Euro and other acceptable foreign currency and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pi/ipinas (BSP). 41 Petitioner further claims that it accumulated excess input VAT in the amount of P58,385,248.41 attributable to its zero-rated sales, which remains unutilized and/or unapplied against its output tax liability. 42 Petitioner thus contends43 that it is entitled to a refund of the said input VAT attributable to its zero-rated sales for the first quarter of calendar year 2009 pursuant to Sections l08(B)(2) and ll2(A), in relation to Section llO(B) of National Internal Revenue Code (NIRC) of 1997, as amended, which are quoted hereunder for easy reference: "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: XXX XXX XXX (2) Services other than those mentioned in the preceding paragraph rendered to a person engaged in(' 11 Par. 31 Petition for Review 1 Docket1 p. 3. 42 Par. 5, Petition for Review, Docket, p. 3. 43 Par. 8.1, Petition for Review, Docket, p. 4.

CTA Case No. 8243 Page 20 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR OI:CISION business conducted outside the 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);" "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 zerc~-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 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 allocated ratably between his zero-rated and non-zero-rated sales." "SEC. 110. Tax Credits. - XXX XXX XXX (B) Excess Output or Input Tax. - If at the end of any taxable quarter the output tax exceeds the input tax, the excess shall be paid by the VAT- t:.

CTA Case No. 8243 Page 21 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION registered person. If the input tax exceeds the output tax, the excess shall be carried over to the succeeding quarter or quarters: xxx Provided, however, That any input tax attributable to zero-rated sales by a VAT- registered person may at his option be refunded or credited against other internal revenue taxes, subject to the provisions of Section 112." Based on the above-quoted provisions, in order to be entitled to a refund or tax credit of input VAT payments attributable to zero-rated or effectively zero-rated sales, the following requisites must be satisfied: 1. that the taxpayer must be VAT-registered; 2. that there must be zero-rated or effectively zero- rated sales; 3. that input taxes were incurred or paid; 4. that such input VAT payments are directly attributable to zero-rated sales or effectively zero- rated sales; 5. that the input VAT payments were not applied against any �output VAT liability; and 6. that the claim for refund was filed within the two- year prescriptive period. Before discussing the other requisites mentioned in the preceding paragraph, the Court shall first rule on the timeliness of the filing of the instant claim. Respondent alleges that petitioner failed to comply with the conditions or requirements under Section 112(C) of the NIRC of 1997, as amended, which would mean that this Court has no jurisdiction to entertain the instant case. 44 In Commissioner of Internal Revenue vs. Aichi Forging Company of Asia, Inc. 45, the Supreme Court explained that in case of tax refunds under Section 112 of the NIRC of 1997, as amended, the phrase "within two years" applies( 44 Par. ll, Answer, Docket, p. 49. 4S G.R. No. 184823, October 6, 2010.

CTA Case No. 8243 Page 22 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION only to the filing of the administrative claim for refund and not to the filing of the judicial claim. The pertinent portions of the decision are quoted as follows: "There is nothing in Section 112 of the NIRC to support respondent's view. Subsection (A) of the said provision states that 'any VAT-registered person, whose sales are zero-rated or effectively zero-rated may, within two 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.' The phrase 'within two (2) years xxx apply for the issuance of a tax credit certificate or refund' refers to applications for refund/credit filed with the CIR and not to appeals made to the CTA. This is apparent in the first paragraph of subsection (D) of the same provision, which states that the CIR has '120 days from the submission of complete documents in support of the application filed in accordance with Subsections (A) and (B)' within which to decide on the claim. In fact, applying the two-year period to judicial claims would render nugatory Section 112(D) of the NIRC, which already provides for a specific period within which a taxpayer should appeal the decision or inaction of the CIR. The second paragraph of Section 112(D) of the NIRC envisions two scenarios: (1) when a decision is issued by the CIR before the lapse of the 120-day period; and (2) when no decision is made after the 120-day period. In both instances, the taxpayer has 30 days within which to file an appeal with the CTA. As we see it then/ the 120-day period is crucial in filing an appeal with the CTA./f Accordingly, petitioner had two years from the close of the first quarter of calendar year 2009, or until March 31, 2011, within which to file its administrative claim with respondent. Evidently, petitioner timely filed its refund claim with the BIRon October 28, 2010. 46( 46 Exhibits "L" and "L-1".

CTA Case No. 8243 Page 23 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DEClSION As regards petitioner's judicial claim, the applicable provision is Section 112(C) of the NIRC of 1997, as amended, which reads as follows: "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." Based on the foregoing, the taxpayer may appeal to this Court within thirty (30) days from receipt of the decision or from inaction of respondent after the lapse of one hundred twenty (120) days from the filing of its administrative claim for refund. In this case, respondent failed to act on petitioner's claim filed on October 28, 2010 within the prescribed period, or until February 25, 2011. Thus, petitioner had thirty (30) days from February 25, 2011, or until March 27, 2011, within which to file with this Court its appeal of respondent's inaction. Accordingly, this Petition for Review filed on March 25, 2011 is well within the prescriptive period allowed by law. The Court shall now proceed to determine the merits of petitioner's claim for refund or tax credit. C

CTA Case No. 8243 Page 24 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DI:ClSlON Petitioner maintains that its sales of services to entities engaged in business conducted outside of the Philippines constitute zero-rated sales. In the case of Commissioner of Internal Revenue vs. Burmeister and Wain Scandinavian Contractor Mindanao, Inc. / 7 the Supreme Court held that in order for the supply of services to be VAT zero-rated under Section 102(B)(2) [now Section 108(B)(2)] of the NIRC of 1997, as amended, the following requisites must be satisfied: 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. It is undisputed that petitioner is licensed to do business as ROHQ in the Philippines 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, logistic services, research and development services and product development, technical support and maintenance, data processing and communication and business development. 48 Petitioner likewise acts as a shared services center, which handles regional, as well as global and accounting and related controlling processes, such as accounting production work in the global general ledger in SAP, developing and operating inter-company clearing house, accounting and head office reporting for non- regulated entities and product control. 49 Evidently, thee ~~ G.R. No. 153205, January 22, 2007. 48 Exhibit "A"; Par. 3, Admitted Facts, JSFI, Docket, p. 80. 49 Par. 4, Admitted Facts, JSFI, Docket, p. 80.

CTA Cctse N<>� 8243 Page 25 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Pt:CISION services provided by petitioner are not in the same category as "processing, manufacturing or repacking of goods". For services rendered during the first quarter of calendar year 2009, petitioner received foreign currency payments (in Euro) which were accounted for in accordance with the BSP rules and regulations, as evidenced by sales invoices50 and official receipts51 issued by petitioner to its alleged non-resident foreign clients, various inward remittance ad vices, and bank statements. 52 To prove that petitioner rendered services to entities/affiliates engaged in business conducted outside the Philippines, it presented the following documents: (a) SEC Certificates of Non-Registration of Company53 ; (b) Various registration documents (i.e., AMI.net Company Profile Fact Sheet, Authenticated Articles of Association, Certificate of Registration, and Certificate of Incorporation on Change of Name of Company) 54 ; and (c) Intragroup Service Agreements55. However, this Court finds that each of the aforesaid documents, standing alone, is an inadequate proof that petitioner's client is a non-resident foreign corporation doing business outside the Philippines. While the SEC Certificates of Non-Registration show that the named entities therein are not registered corporations/partnerships in the Philippines, the same do not prove that such entities are non-resident foreign( 50 Exhibits "J92" to "J286". ~ 1 Exhibits "J287" to ".1342". 52 Exhibits "Jl" to "J91". 53 Exhibits "0-12", "0-14" to "0-20", "0-22", "0-24", "0-25", "0-30" to "0-40", "0- 44", "0-47", and "0-48". s-1 Exhibits "0" to "0-10" and "0-49" to "0-73". ~~Exhibits "P" "P-2" to "P-11" "P-13" "P-14" "P-16" "P-18" "P-20" to "P-27" "P-'III�I-II 32", and "P-35".

CTA Case No. 8243 Page 26 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION corporations doing business outside the Philippines. Likewise, the Certificate of Association and Certificates of Registration/Incorporation of Foreign Company only prove that the named entities therein were incorporated/organized abroad but do not establish that such entities are not doing business in the Philippines. Also, the Service Agreements only show the names of petitioner's customers to whom it rendered services but the same do not establish that such customers are non-resident foreign corporations doing business outside the Philippines. To be considered as 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 Certificate/ Articles of Foreign Incorporation/ Association/Registration. Thus, only the following clients of petitioner shall be considered as non-resident foreign corporations doing business outside the Philippines: AMI. net Company Profile Fact Sheet, Articles of Association, Certificate of Registration, and Certification of Incorporation St:C Certificate on Change of Entity of Non- Name of Code56 Client _____ ~-~istration ~_9!_11!~L_ Deutsche Bank Akt1engesellschaft, Inlandsbi!D_Is____ _ ___2_::!L_ ~~ _ _______Q::_"!2_____~ f--_.:_74_:_:3'-----+_:::::D=eu=ts=c~heBank Sociedad Anonima Espanola _ _ _ _ _ O~]Z__ 0-50 744 Deutsche Bank Aktiengesellschaft, Filiale Zurich 044 0-51 747 Deutsche Bank Aktiengesellschaft, Filiale Wien 0~40 0~52 781 Deutsche Bank Aktiengesellschaft, Filiale Singapur 0~20 0-7 783 Deutsche Bank Aktieng~sellschaft, Filiale Bangkok__ ------~ 0~25_~----� -~-- o~~~-----~ 786 Del!tsche Bank Aktien__92sellschaft, Filiale Hongkong__ ---~_Q:JlL_~~. ~- ______2_:~---~- 788 Deutsche Bank Aktlengesellschaftliliale Jakar!~-- ____ .J2::l2.___~-- -~ ~-_Q-6 ---~--~ 801 Deutsche Asset Management (Asia) Limited 0-22 0~8 840 Deutsche Bank Aktiengesellschaft, Filiale London 0-14 o~55 845 Deutsche Bank Aktiengesellschaft, Filiale Prag 0-32 0~56 871 _Deutsche Bank Luxembo!:![9 SA____ � - - - - - - ----~--~Q::.J1_____ _ ___0~57_ ~--- 872 Deutsche Securi~1es Inc,_~~-------------~ -----~Q-:.E __ ~- --~-___Q::i_______ 910 Deutsche Bank (Chma) Co. Ltd., BeiJing Branch 0~36 0~59 ~ 6 Annex E, Exhibit "R".

CTA Case No. 8243 Page 27 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION 935 DWS Holding & Service GmbH 0-39 0-60 5046 Deutsche Asia Pacific Holdings Pte Ltd. 0-15 0-3 5157 PT Deutsche Securities Indone.=sia"----- 0-38 0-61 5180 Deutsche Group Serv1ces Pty Limited 0-16 0-10 5735 Deutsche Bank PBC Spolka Akcyjna 0-62 -----~-- 0-33 6201 Deutsche Bank Trust Company Americas 0-35 0-63 6502 DB Finance Inc. 0-30 0-64 ___ 651~- DB Tru~tCompan'i__[J[!litedJa~n_____~--- 0-31 0-65 - 682~-- DBjnternational (Asia)J:i!Dited ~�--� --~------- ______0_-_4_8____ ----0--~ 66--- c-----2478. DBOI Global Services Private Limited -~-_Q~~'L 0-6.:__7~------1 L. 9608 Global Marke~CcntrQ. Private LimiteQ_ __ -~---- _______ 047___ __ ___2::68 _ __ Accordingly, petitioner's sales of services to the afore- mentioned entities for the first quarter of calendar year 2009 in the amount of 4,634,848.23 with peso equivalent of P289,872,951.07, as presented below, qualify for VAT zero- rating under Section 108(8)(2) of the NIRC of 1997, as amended: Inward R~mittance Official Ref.:eipt Entity Exhibit Code Exhibit No.. - Amount No. Amount J289 5180 J3 1~,541.00 p 7871073.91 ~5 J5 925.00 J287 60 012.77 ------ ___r::___- 6502 -~---- -~-~ 6518 J7 1,388.00 J290 - - -87,805.24_ ----~ \ - - - - - - - - - - - - - - - - - - - - ---~ J8 1(388.00 J291 891671.27 5180 J12 4,464.00 J293 28Ql165.95 786 J14 6651050.31 .1294 4019701510.83 910 J16 18�500.00 J295 1133 649.85 910 Jl7 18,50Q~OO J296 _ ----- __1133,649~85 . -- 1----- 1--------- Jl9 16,650.00 J298 1,070,275.32 788 ~ 872 J20 911(272.00 J297 56,175(316.96 5180 J22 11,200.00 J299 679,119.84 r- 5735 I- J24 463.00 J300 --+- 28,146.00- 5157 840 J26 - - - ~--- 1,850.00 J301 ---~118,11Q.6~ 840 J28 102,966.00 J302 - - - +----~464,764.72__ --- J30 142131 1.00 J303 8,9351Q84.06 840 J34 80100Q.QO J305 5,02218~8.10 127,751.60 J307 I 840 J37 8l02Ql945.05 6201 J41 _LA2~.og_ 1----- J309 -------- 86l3Q2.97 6201 J43 688.00 - - - -J3-1-0- - - ------ ___4---"1,632.~�- 781 J47 25,000.00 J312 1,549(353 .33 747 J54 925.00 J316 5~J62.88 100 J56 1J52,962.93 J317 109,~~4l~54.58 781 J61 -J3-21- ____ __289)32.04 840 J67 - c 16 174.71 +--------~------- - -- \- - 981686.oo 1 J324 6,1961057.88

CTA Case No. 8243 Page 28 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION 845 J69 925.00 J327 60,012.77 801 J70 87_[500.07 J328 -+--------=-5,697f 165.43 - - - - ----- ----- 935 ]71 J32-9 - _____ ___1204,54512_ 18,500.04 9478 J73 J330 5,0~1,412.87 77(050.00 747- J74 647.00 J331 4!,102.26 1,850.00 J332 5157 J75 11~)33.05 743 J76 27 750.06 J333 1 830 103.97 ______________L _ _L _ __, 6518 ----- _ _ __�_2,638. 97_ 840 5(33�,~ 73.87 . -_J7_Z____--+--_ _1_~,_3_8_7_5.Q_____ J334 J79 84(991.00 J335 783 J81 18,500.04 J336 1,209{926.30 6822 J83 46,250.10 J338 ?,9~4)65.14 1 - 6822 - - - -_J_81__ 123,233.87 J3J2____ ____ZL97J!L~1_6.89 - -5- ,55- 1.0- 0 ------ 126,984.00 - 9608 J85 647.00 J340 359,387.78 r--- 840 ]86 J337 + - - - -7,972,750.92 871 J91 J342 41J72.31 TOTAL ____ ~1,631r~4~~~~ _ __ ~2~~l~z2,~~!~Q7 _ --- ------------ - -~ - -- The rest of petitioner's declared zero-rated sales in the amount of P863,838,977.32, that is P1,153,71l,928.39 less P289,872,951.07, shall be denied VAT zero-rating for petitioner's failure to prove that the entities to whom it rendered services are non-resident foreign corporations doing business outside the Philippines. Petitioner asserts that its input VAT for the first quarter of calendar year 2009 in the amount of P58,385,248.4l, as shown below, are duly substantiated by appropriate documentary evidence and are attributable to its zero-rated sales: - - - - - - - - - - - - - - - - - - - - - - ---------------~--------------- lnput VAT from Current Tr~nsactions Purchase of Capital Goods not exceeding P1 Million p 4,464.22 Purchase of C~pital Goods exceeding P1 Million 1,500,608.79 Domestic Purchases of Goods Other than Capital Goods Domestic Purchases of Services Services Rendered b Non-Residents ---------- Totallnput VAT per Return In support of- its claim, petitioner presented various invoices and official receipts issued by its suppliers, BIR Form 1600, and other documents,S7 which were all examined~ ~7 Exhibits "J-343" to "J-1555".

CTA Case No. 8243 Page 29 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Dt:CISION by the Independent Certified Public Accountant (ICPA). The latter noted the following exceptions, which this Court finds in order; thus, shall be disallowed from petitioner's claim :58 -~- ----~----~~-~--~------~------ -,-~- Disallowed Fiodin_g~ Inp~tVAT Purchase of goods not supported by suppli~r'~ sales invoj_~ce::o:::s~_ f _ _~S3J.:~L Purchase of services not supported by supplier's official receipts +---4-'-'-148,408.2Z Input VAT on purchases with in~alid supporting documents 477J87.39 Purchase of goods and services not within the l 5 quarter of CY 2009 503)90.09 t Total In addition, the input VAT of P41,000,124.19, as detailed below 1 shall be disallowed for petitioner's failure to meet the substantiation requirements under Sections 110(A) and 113(A) and (B) of the NIRC of 1997 I as amended by Republic Act (RA) No. 93371 and as implemented by Sections 4.110-2, 4.110-3 1 4.110-8 and 4.113-1 of Revenue Regulations (RR) No. 16-05: Exhibit Supplier lom~a j . v1oRiceec/e1.pt Otsallowed Ioput VAT No. -~---~~------ --~--- 1. Input VAT not separately indicated in the supporting invoicf!s or official receipts J370 Ambassador Home and Electronics Cente 83521 p 238.93 ]388 JJED Philippines, Inc 66493 7,373.46 J389 JJED Philippines, Inc. 66848 8,276.25 J393 Michigan Enterprises Corporation 14730 7,232.14 J394 Michigan Enterprises Corporation 14731 10,285.71 J502 6-24 Property Holdings, Inc. 134 2,049,996.96 J503 6-24 Property Holdings, Inc. 204 372,726.72 J504 6-24 Property Holdings, Inc. - 205 1,384,566.21 ]505 6-24 Property Holdings, Inc. 217 2,049,996.96 ]506 6-3 Property Holdings, Inc 635 977,894.04 J509 6-3 Property Holdings, Inc. 648 2,081.88 J510 6-3 Property Holdings, Inc. 681 171,590.94 ]511 A. Soriano Corporation 19217 454,100.17 ]513 ACCRALAW 34999 28.07 J515 ACCRA LAW ---~~~~ 34998 120.00 r--- ACCRALAW 34997 720.00 J516 ]519 Air2100, Inc 42055 1----- 278.28 ]520 42061 -- ]532 . Air2100, Inc 39806 283.76 ]533 4605 i American Express Transnational, Inc 15,845.09 ---------1 1,431.76 I Asia Select, Inc 58 Exhibit "R".

CTA Case No. 8243 Page 30 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION ]534 Asia Select, Inc. 4606 1,149.03 ]535 Asia Select, Inc. 4629 2,522.83 ]536 Asia Select, Inc. 4674 1,071.33 J537 Asia Select, Inc. 4697 1,348.83 ]538 Asia Select, Inc. 4776 1,128.91 r----- ----------- 28622 482.14 J539 Audioman Enterprises -----1------------ -------- -----t----------- ]540 Audioman Enterprises 28664 1,232.14 ---- - - - - - - - - - - - - - 1 - - - - - - - - - - - - - - - - - - - ------ ------ J541 Audioman Enterprises 28713 5,357.14 -- J542 Audioman Enterprises 28683 535.71 ---------------- - - - - - - - - ----1--------------------- ]543 Autohome Business Solutions, Inc. 973 4)17.48 -------------- !-----� 938 1,899.24 J544 Autohome Business Solutions, Inc. ---------- ---- ]545 Autohome Business Solutions, Inc. 836 4,217.48 ��---��---------- ]546 Autohome Business Solutions, Inc. 939 J547 Barrington Carpets, Inc. 11276 1,449,815.15 J548 Bayan Telecommunications, Inc. 297585 182.04 J549 --------- ]550 Bayan Telecommunications, Inc. 297654 182.04 r-- - - - - - - - - - - - - - - - - - - - - - -----~--~---~ -------------~---- ]552 Bayan Telecommunications, Inc. 306127 182.04 ---------------------------- ----------- Bayan Telecommunications, Inc. 297597 182.04 ]553 sayan Telecommunications, Inc. 305617 182.04 ]555 Sayan Telecommunications, Inc. 279282 182.04 ]556 Sayan Telecommunications, Inc. 297652 182.04 ]557 Sayan Telecommunications, Inc. 306146 182.04 ]559 Sayan Telecommunications, Inc. 279275 182.04 ]560 297598 182.04 - Sayan Telecommunications, Inc. ]561 Sayan Telecommunications, Inc. 306124 182.04 ]563 Sayan Telecommunications, Inc. 306120 182.04 ]564 Sayan Telecommunications, Inc. 279276 182.04 ]565 Sayan Telecommunications, Inc. 297599 182.04 J566 Bayan Telecommunications, Inc. 305607 182.04 r--]-5-68 Sayan Telecommunications, Inc. 306137 182.04 ]570 Bayan Telecommunications, Inc. - - - - ---~--- 297656 182.04 �-----1-- - - - - - - - - - - - - - - - - - - - J571 Bayan Telecommunications, Inc. 305635 182.04 ------~---- J573 Bayan Telecommunications, Inc. 279271 - - - - - -182-.0-4 !----------r--- 297593 182.04 ]577 Bayan Telecommunications, Inc. J578 Bayan Telecommunications, Inc. 305632 182.04 J580 1----- 297653 182.04 r---- Bayan Telecommunications, Inc. ------ J581 --- 306125 182.04 ---------------------------- Bayan Telecommunications, Inc. J583 Bayan Telecommunications, Inc. - - - -29-76-70� - - - - 182.04 ----------- J584 Bayan Telecommunications, Inc. 306126 182.04 ------------------1 ]586 Bayan Telecommunications, Inc. 297657 182.04 +-- ------------~ ]587 Bayan Telecommunications, Inc. 305619 182.04 ]589 Bayan Telecommunications, Inc. 279270 182.04 ]590 Bayan Telecommunications, Inc. 297658 -------- 182.04 J591 Sayan Telecommunications, Inc. 305609 182.04 ]593 Sayan Telecommunications, Inc. 297580 182.04 ]594 Sayan Telecommunications, Inc. 306148 182.04 ]596 Sayan Telecommunications, Inc. 279264 -----------1-82-.-0-4-c.

CTA Case No. 824l Page 31 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION J597 Bayan TclccommunicaUons, Inc. 297672 182.04 J598 Bayan Tclccommunications, Inc. 306134 182.04 J600 Bayan Tclccommunications, Inc. 279269 182.04 J601 Bayan Tclccommun1cations, Inc. 297651 182.04 J602 Bayan Tclccommunications; Inc. 306121 182.04 .. ]604 Bayan Telecornmunications, Inc. 297579 182.04 ----------------------------- . -�-----------~-------�------ --------------------�- ]605 Bayan Teleco rnmunications, Inc. 305616 182.04 - - -.. � 1---- ---- ]607 Bayan Telecornrnunications, Inc. 279263 182.04 - - - - - - - - - - - - - - - - - - - - - - - - - - ---------- ~---------- ]608 Bayan Telecornrnunications, Inc. 297676 182.04 ----� ------------------------------------------------ ------------- J609 Bayan Telecornrnunications, Inc. 306122 182.04 1 - - - - - -1-- J611 Bayan Telecomrnunications, Inc. - - - - - - - � - - - __... _. ..2_9_75_8_1____ .. _ _ _...... -----1-8-2�-.0-4-- J612 Bayan Telecornmunications, Inc. 306133 182.04 ------------------- -�-------------- ----------------- ---------------------- J614 Bayan Telecornrnunications, Inc. 297662 182.04 � - - - - -+-� - - - - - - - - - - - - - - - - - - - � ---------�-�-��--- ---��--�--���-�--- ......... J615 Bayan Telecornrnunications, Inc. 305613 182.04 ]617 Bayan Telecornrnunications, Inc. 306141 182.04 ]618 Bayan Telecornrnunications, Inc. _ _ _ _ _ .. .. ... ----1�--�--�-----� 182.04 279277 ]619 Bayan Telecomrnunications, Inc. 306144 182.04 -----..- � - - + - - - - - - - - - - - - - � - - - - - - - 1--�--- 306142 182.04 ]620 Bayan Telecornrnunications, Inc. J622 Bayan Tclccommunications, Inc. 279283 182.04 J623 Bayan Tclccommunications, Inc. 297661 182.04 J624 Bayan Tclccommun1cations, Inc. 305622 182.04 J626 Bayan Tclccommunications, Inc. 297594 182.04 J627 Bayan Tclccommunications, Inc. 305633 182.04 .J629 Bayan Tclccommunications, Inc. 279281 182.04 J630 Bayan Tclccommun1cations, Inc. 297565 182.04 J631 Bayan Tclccommunications, Inc. 297566 182.04 J632 Bayan Tclccommunications, Inc. 305634 182.04 J634 Bayan Tclccommun1cations, Inc. 279261 182.04 J635 Bayan Tclccommunications, Inc. 297595 182.04 .J636 Bayan Tclccommunications, Inc. 305614 182.04 ]638 Bayan Telecomrnunications, Inc. ______ ____ 297582 182.04 .. _ .._.... - - -..... - -... - - - - - - ]639 Bayan Telecornrnunications, Inc. -... 306130 182.04 1-� ... - - - - - - - - - � - � - - - - � - - - - - - - - - ]641 Bayan Telecornrnunications, Inc. 279262 182.04 f----- 1----'----- 297568 182.04 ......_ ........_ _ _ _ _ _ _ _ _ - � - - - - - - - - � - - - j J642 Bayan Telecommunications, Inc. -- ---~~~1_31______j_ _________1_82~~ ]643 Bayan Telecornmunications, Inc. 297577 182.04 J645 Bayan Telecornmunications, Inc. 297570 182.04 - - - -1----'---� ]646 Bayan Telecornrnunications, Inc. ]649 Bayan Telecomrnunications, Inc. 279260 182.04 . --------------- --------------- ~- 1---� 297663 182.04 J650 Bayan Telecornmunications, Inc. 305610 182.04 1-- J651 Bayan Telecornrnunications, Inc. J654 Bayan Telecomrnunications, Inc. 279268 182.04 - � - - - - - - - - - - - � - - - - - - -.....- - - - - - l65Ur" _______ _________ ------~ J655 ! Bayan Telecomrnunications, Inc. .. 297674 182.04 -----�-------�-� -----�----- f-.� 305601 182.04 ornrnunications, Inc. 297572 182.04 J657 Bayan Tecleccommunications, Inc. J658 Bayan Tclccommunications, Inc. 305623 182.04 J781 Career Managernent Consulting & Business Solution, 91 16,650.00 �---- Inc. ---------- - ----�- ----� -- -- ( ------�-�� - - - - - - � - ---�-

CTA Case No. 8243 Page 32 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Dt:CIS!ON J782 Career Management Consulting & Business Solution, 92 21,750.00 J783 Inc. 93 21,600.00 J784 Career Management Consulting & Business Solution, 94 21,600.00 J792 Inc. 19309 Career Management Consulting & Business Solution, 600.00 Inc. CIBI Information, Inc. J793 Colliers International Philippines, Inc. 11032 754.82 J794 Colliers International Philippines, Inc. 10834 151,431.82 J795 Colliers International Philippines, Inc. 10979 151,431.82 ----~- -----� 1 - - - - - - - - - J796 Concept One Management Services 219 - - - -- :-------- 10,178.57 -~--~ -~--~--- ---- ]797 Cravings Food Services, Inc. 7017 5,785. 71 - ~--------- ----~ ]800 CWC International Corp. 27091 5,657,784.63 - - - ~---�- -- - J801 CWC International Corp. - 27078 249,375.00 ----------� -------~------ J802 CWC International Corp. 27311 4,526,227.70 ----~-------- J806 DB Wizards, Inc. -�----�----+- 8989 19,800.00 r---~--!--------------�-~-�---- ~---- --~---- -~-----------~---~ J807 DB Wizards, Inc. 9112 41,417.83 ------------ J809 Design & Creative Logic, Inc. 3480 4,276.85 ---~- - - - - - - - - - - J810 Design & Creative Logic, Inc. 3490 2,251.82 -- -- J812 Design & Creative Logic, Inc. 3479 2,673.43 -�- J814 Design & Creative Logic, Inc. 3482 2,673.43 ----- -~-- ---~--- J816 DHL Express Phils. Corp. 1.250931 1,166.35 ! - - - - - - - - - - _ _ _ _ _ _ _ __J______ ~ --~---- J818 DHL Express Phils. Corp. 1250014 1,344.20 J820 DHL Express Phils. Corp. 250489 4,503.39 J822 DHL Express Pl11ls. Corp. 1 250930 4,634.17 J824 DHL Express Phils. Corp. .251050 12,163.75 J827 DHL Express Phils. Corp. 5,045.49 - .251049 .1834 DHL Express Ph1ls. Corp. 1250453 2,044.60 J836 DHL Express Ph1ls. Corp. 1251558 209.44 J837 E.E. Black, Ltd. 1351 1,299,882.09 J838 E.E. Black, Ltd. 1355 2,664,441.69 J840 Electronic Secunty Systems Corporation 7727 4,071.43 J841 Electronic Security Systems Corporation 7733 3,642.86 J849 Exclusive Cars, Inc. 2073 819.91 J850 Exclusive Cars, Inc. -----------+-- 2079 1,776.66 ]851 Exclusive Cars, Inc. 3,260.07 Exclusive Cars, Inc. 2080 3,662.02 J852 Exclusive Cars, Inc. - � - - � - - t--- 3,162.19 1----- 2081 ---!--- J853 2082 J854 Exclusive Cars, Inc. 2084 2,762.31 ------ J855 Exclusive Cars, Inc. 2085 505.72 r-- Exclusive Cars, Inc. -- J856 2089 1,324.84 - - - - - - - �------~-- J861 Exclusive Cars, Inc. -- 2100 2,946.09 - - - - - -! - - - - - - - - - - - - - - J864 Exclusive Cars, Inc. 2113 2,442.06 ~----- - - - � - - - - - - - - - J865 Exclusive Cars, Inc. 2114 2,715.57 ----- ------------ J866 Exclusive Cars, Inc. 2136 367.23 - - - - - - - - - ~------ J868 Exclusive Cars, Inc. 2140 2,356.87 ]899 Facilities Managers, Inc. --- 36677 25,253.81 ---- -----�-----~ J900 Facilities Managers, Inc. 36780 27,872.23 J901 Facilities Managers, Inc. 47.32 < 36923 ~--~-- ~----~----~-------~-- ---� . ---- ------------------

CTA Case No. 8243 Page 33 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Dt:ClSION J902 Facilities Managers, Inc. 36924 1,746.42 J903 Facilities Managers, Inc. 36925 2,283.53 J904 Facilities Managers, Inc. 36926 320.88 J1212 Goudie Associates Manila, Ltd. 1401 21,497.14 J1213 Goudie Associates Manila, Ltd. 1426 42,994.28 J1215 1------------- ---------- J1216 �----~~ t----- 1043 43,680.00 Headstron-g P-hi-lipp-ines, Inc. +---- 11,520.00 Headstrong Philippines, Inc. 1045 � - - - - -1------ J1217 Headstrong Philippines, Inc. 1047 23,250.00 - -1 - - - - - - - - � - - - - - - - - � - ---- 717 399,167.14 !.Systems Integrators, Inc. - - 1 1-------~------�-- - - - - - - - � - - - - - --+-~ 17623 533,571.43 International Elevator & Equipment, Inc. --------- Jones Lang LaSalle (Philippines) Inc. 3405 50,895.00 �-- --------------� Jones Lang LaSalle (Philippines) Inc. 270,864.00 ,_ _ _ _ _ _ _ _ 3414 ----~- - - � - - - - - - - - - J1258 Jones Lang LaSalle (Philippines) Inc. 3406 48,214.65 ~--~---~- --�-~-------- -�--~-�~- J1259 Jones Lang LaSalle (Philippines) Inc. 3464 --- 135,432.00 1------�-+-- - - - -~--~--~------~ J1264 Kapient Philippines, Inc. 1088 49,896.00 1 - - - - - - - - -~ ------~----- J1265 Kapient Philippines, Inc. 1089 41,580.00 1 - - - - - - - - - - ----~- -------~--- J1275 Lane Moving & Storage, Inc. 80478 ---1--------- 360.00 J1276 Lane Moving & Storage, Inc. 80563 180.00 J1277 Lantro Phils., Inc. 1874 69,105.80 ]1278 Lantro Ph1ls., Inc. 1875 4,119,728.59 Lantro Phils., Inc. 1876 8,264.82 - Jl279 J1284 Mandarin Oriental Manila 21777 10,800.00 5261 103,243.19 - J1285 Me Engineering, Inc. J1286 Me Engineering, Inc. 5263 119,732.14 J1287 Me Engineenng, Inc. 5266 541,071.42 Jl288 Me Engineering, Inc. 5264 2,422,229.74 J1289 Me Engineering, Inc. 5272 3,494,265.27 J1290 Micro-D International, Inc. 24647 5,827.63 J1291 Micro-D International, Inc. 24615 4,845.80 J1292 Micro-D International, Inc. 24562 124,039.93 J1293 Micro-D International, Inc. 24592 10,085.89 --- 24614 151,640.91 J1294 Micro-D International, Inc. J1295 Micro-D International, Inc. 24648 9,208.93 J1296 Monolith Construction and Development Corporation 2448 259,244.85 J1297 Monolith Construction and Development Corporation 2449 -f----------~ 8,674.47 J1298 No Ka Oi (Philippines) International Inc. 16946 4,933.67 2,466.84 -- 151.09 J1299 No Ka Oi (Philippines) International Inc. 17080 258.02 486.67 -~--------- 239.40 160.71 J1308 PLDT PWKOR000599041 --+--�--------�- !----------- J1309 PLDT PWKOR000596237 151.09 1--------+--------�-�� --------- J1310 PLDT PWKOR000596236 1-------+---------------~ - - - - - - - - - - - - J1317 PLDT PWKOR000599009 f-------+---------�-- f------- Jl3l8 PLDT PWKOR000599004 ---~------ J1320 PLDT PWKOR000596238 Jl321 PLDT PWKOR000599039 160.71 Jl324 PLDT PWKOR000599002 160.71 Jl325 PLDT PWKOR000599037 160.71 J1326 PLDT PWKOR000599022 160.71 - - - - - - - - - - - - - - - - ---------�~ -~------------

CTA Case No. 8243 Page 34 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION Jl329 PLOT PWKOR000599010 239.40 ]1340 PLOT PWKOR000599018 239.40 ]1347 PLOT PWKOR000599036 239.40 Jl349 PLOT PWKOR000599007 389.38 ]1352 PLOT PWKOR000599032 239.40 J1354 PLOT ------+~ -~~-~---- ~------- --+- PWKOR000599025 239.40 ------- ]1357 PLDT PWKOR000599024 239.40 -- --+--- ]1359 PLDT PWKOR000599000 160.71 ---+~-------+------- J1362 PLDT PWKOR000596241 31,482.18 --- --1--- ~~----~- --�-�� ]1363 PLDT PWKOR000599020 160.71 J1364 PLDT PWKOR000599023 ]1368 PLDT J1369 PLDT -- J1371 PLDT PWKOR0005990 19 239.36 ~- f - - - - - - - - - --- PWKOR000596239 8,507.70 ]1372 PLDT ---- J1373 PLDT PWKOR000599011 239.40 PLOT f------- ---- ]1374 PWKOR0005990 16 217.68 --- ---- J1376 PLDT PWKOR000599014 239.40 ]1377 PLOT PWKOR000599006 239.40 Jl378 PLOT PWKOR000599013 239.40 Jl381 PLOT PWKOR000599904 239.40 Jl386 PLOT PWKOR000618366 160.71 Jl391 PLOT PWKOR000618373 239.40 J1398 PLOT PWKOR000619572 217.68 ]1416 PLOT PWKOR000619567 389.38 J1417 PLOT PWKOR000619571 389.38 J1418 PLOT PWKOR000619569 389.38 ]1426 PLOT PWKOR000619568 160.71 ]1427 PLOT PWKOR000624041 160.71 ]1431 PLOT PWKOR00061836 7 217.68 r - - -~- PWKOR000618369 239.40 16,200.00 J1438 PLDT ~-- J1453 PLDT PWKOR00062404 5 ]1454 PLDT PWKOR000624043 19,980.00 J1456 PLDT PWKOR000596240 25,804.97 J1459 Premium Security & Investigation Agency, Inc. 51515 2,890.14 J1461 Premium Security & Investigation Agency, Inc. 51166 2,704.11 J1463 Premium Security & Investigation Agency, Inc. 51474 3,191.70 51477 J1465 Premium Security & Investigation Agency, Inc. ----~ 5,756.52 J1467 Premium Security & Investigation Agency, Inc. 51774 5,756.52 J1468 Primover Consultancy Services, Inc. 2280 ---~- J1473 R.S. Ison & Associates -------- 38,640.00 ]1475 R.S. Bernaldo & Associates 295 --------- J1476 Real Form Furniture Shop --~------- 4,800.00 ]1477 Real Form Furniture Shop 2906 ------ 161 36,000.00 --~---- 1,029.60 173 4,365.00 ]1478 Regus Centres, Inc. 11424 12,213.00 ]1483 RP Reytas Industries 166 8,357.14 ]1492 Smclair Knight Merz ( 1197 19,440.00 ---------- -------

CTA Case No. 8243 Page 35 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR OI:CISION J1493 Sky Cable Corporation 4805 14 48,192.00 ]1500 Solstice Ventures, Inc. 12,857.14 3 ]1501 SOP Printmg House 95 9 1,125.00 J1502 SOP Pnnting House 96 0 1,735.71 ]1506 Stagetek, Co. 33 0 535.71 ]1507 --------~------ -~ --~-------- -- Sycip Salazar Hernandez & Gatmaitan 5037 944 2,700.00 --- ]1510 Tempo Services, Inc. --- 416 41 2,680.39 -------- ]1511 Tempo Services, Inc. 412 94 2,808.67 r----- - - - - - - -~----- f-------~--~-- -- ]1512 Tempo Services, Inc. 416 42 2,847.95 ]1513 Tempo Services, Inc. 418 84 2,811.86 - - - - - - - ~---------- -- J1514 Tempo Services, Inc. 420 16 2,808.20 - - - -t--- -- ]1515 Tempo Services, Inc. --- 420 23 3,349.34 -�------ -- J1516 Tempo Services, Inc. 421 24 2,625.62 --~----------~---- J1517 Tempo Services, Inc. 368 99 2,570.85 --~---~-- J1518 Tierra International Construction Corporation 149 27 432,000.00 ---- ----------- J1519 Trane Philippines 263 88 ----- f------- 188,244.00 J1520 Zero Eight DB Design Services 26 1 9,000.00 - - - - - - - - - --------~~ 1--- Svb-tot~l 38,125,23(i.(i7 2. Inpf.Jt V-4 T supported by official receipts dated not within the first quarter of2009 -- J514 ACCRA LAW 359 29 5,400.00 J521 A1r2100, Inc. 473 79 438.71 J522 Air2100, Inc. 473 80 129.21 J523 Air2100, Inc. 473 81 399.63 J524 Air2100, Inc. 473 82 505.62 J525 Air2100, Inc. 473 83 131.20 J526 Air2100, Inc. 473 84 431.42 J527 Air2100, Inc. 473 85 208.48 J528 Air2100, Inc. 473 86 104.24 J529 A1r2100, Inc. 473 87 108.45 J530 Air2100, Inc. 47 388 108.45 J551 - - - 1 - - - - - -- - - -~-----~--- J554 -----~- J558 331 599 182.04 J562 Bayan Telecommunications, Inc. - - - - ----l---~-- -1----------- Bayan Telecommunications, Inc. 331 582 182.04 Bayan Telecommunications, Inc. -~ Bayan Telecommunications, Inc. 331 600 182.04 --- 331 588 182.04 J567 Bayan Telecommunications, Inc. 331 584 182.04 ----- 182.04 J569 Bayan Telecommunications, Inc. 331 906 - 331 907 182.04 ]572 Bayan Telecommunications, Inc. - - -------~----- ]579 Bayan Telecommunications, Inc. 331 908 182.04 - - -+-----'---------------~-~--- ----------- ------- - - - - - ]582 Bayan Telecommunications, Inc. 331 909 182.04 - - - - - - ,----------------~-~ -1--------- 331 910 182.04 ]585 Bayan Telecommunications, Inc. ----- ]588 Bayan Telecommunications, Inc. 331.911- - - -f------------ 182.04 ]592 Bayan Telecommunications, Inc. ------- 331 583 182.04 J595 Bayan Telecommunications, Inc. -- 331 .912 182.04 J599 Bayan Telecommunications, Inc. 350 063 182.04 J603 Bayan Telecommunications, Inc. 350 064 182.04 J606 Bayan Telecommunications, Inc. 331 913 182.04 ]610 Bayan Telecommunications, Inc. 350 065 182.04 ---- ------------- --

CTA Case No. 8243 Page 36 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION J613 Bayan Telecommunications, Inc. 331914 182.04 J616 Bayan Telecommun1cations, Inc. 331592 182.04 J621 Bayan Telecom mun1cations, Inc. 331590 182.04 J625 Bayan Telecom mun1cations, Inc. 331915 182.04 J628 Bayan Telecom mun1cations, Inc. 331591 182.04 - - - - - - - - - - - - - - r-----~ !----~~~ ~--~~-~~~~- ---~- -~ -~ -------�--- -----�-��------ ]633 Bayan Telecom munications, Inc. 331598 182.04 -1------------ J637 _Ba,ya_n Telecommunications, Inc. 331596 182.04 ----~ -----------�- ---------- ---------- ----------- ------~-~-------------~- J640 Bayan Telecom munications, Inc. 331595 182.04 ------------- --------------------------- ---- J644 Bayan Telecom munications, Inc. 331593 182.04 r----- - - - � - - - - - - - - - - - - - - - - ---~------------~- ---~---------------------------- ]647 331916 182.04 Bayan Telecom munications, Inc. t---� J648 Bayan Telecom munications, Inc. 331917 182.04 ----------------- - ------------------------ ---------------- ---~ ~--~ - - - - - - J652 Bayan Telecom munications, Inc. 331597 r- 182.04 - � -!-----~--~-----~-------------~---�---- ~-~------�--- ----~-------�--- J653 Bayan Telecom munications, Inc. 331918 269.22 r------ J659 Bayan Telecom munications, Inc. 331919 - - - - - - - - - - - - - � - - - - - � ~------ - � - � - - ~~-~------~---------------~~----�-� J790 Chef Concepts I ncorporated 15057 - - - - - - - - ---~~ ------~---------~--~-~---�---------- J832 DHL Express Phi Is. Corp. 1308240 - - - - - - - - - - � - - - �-------------- ~--- -------~------------~- --- ---------~-------~---- - � � � � - - - - - - ]839 Electronic Security Systems Corporation 7809 964.29 r----- -------�---��--��----- �-----�--------- - - - - - - - - - --------~--------------~~- ]909 FMR Corporation 5960 1,210.71 J915 FuJi Xerox Philippmes, Inc. 89299 64,807.35 J977 Globe Telecom, Inc. GALXAF05083274 204.00 J984 Globe Telecom, Inc. GALXAF05083270 204.00 Jl007 Globe Telecom, Inc. GALXAF05083265 204.00 J1012 Globe Telecom, Inc. GALXAF05083268 204.00 Jl015 Globe Telecom, Inc. GALXAF05083273 128.75 Jl092 Globe Telecom, Inc. GALXAF05083266 204.00 Jll03 Globe Telecom, Inc. GALXAF05083275 204.00 Jll06 Globe Telecom, Inc. GALXAF05083267 204.00 Jll80 Globe Telecom, Inc. GTWR�3005083272 204.00 Jl221 Innove Commu nications, Inc. 2168 138.75 J1227 Innove Commu n1cations, Inc. 2167 138.75 -�-- - - ~----------- J1251 Innove Cornmu nications, Inc. -----~-------� ----�--- -t----~~-- 2166 138.75 Jl252 Innove Communications, Inc. 2165 138.75 J1262 Jones Lang LaSaile (Philippines) Inc. 3550 135,432.00 --- ~--------~------- ----~-------- J1263 Jones Lang LaSaile (Philippines) Inc. 3552 109,859.28 --~~--~-~ - - - - - - - - - - - - - - - - - Jl266 Kapient Philippines, Inc. 1091 20,700.00 1------- - - - - - - - - - ~------------- -------~--- r -J1-27-4- Lane Moving & Storage, Inc. 80726 f--~--~~-~----~-----~~---~----- ---~-------- 900.00 ]1283 Loxon Philippines, Inc. 20408 787.50 --~-~ J1486 Santa Fe Maving and Relocation Services, Phils., Inc. 407 J1487 SAS Institute ( Philippines), Inc. t----~--~ -~- J1503 SOP Printing House ]1504 ---~--~------------- --~-------~- 1----- SOP Printing House Sub-tot~ I ~----- 3. Input VAT supported by documents other than invoices or official receipts J396/7 National Book Store SSRDATED1/28/09 5,343.00 J409 5,345.43 National Book Store SSRDATEDl/ 14/09 5,356.88 J424 National Book Store SSRDATEDl/27/09 J431 National Book Store SSRDATED2/ 1/09 -- - - - - - -~----------~-~- -~ -------~-------

CTA Case No. 8243 Page 37 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Dt:CISION J442 National Book Store SSROATE02/3/09 5,302.02 J452/3 National Book Store SSROATE02/ 19/09 5,351.57 J467 National Book Store SSROATED 1/2/09 5,320.15 Jl305 PLOT 7160 803.66 Jl306 PLOT 4255 239.40 1----~ ]1307 PLOT 6500 -�-�--- -----------------~------- J1311 PLOT 1923 1--- f . - - - - - - ----�~-----~ J1312 PLOT - - - - - 9544 - - -- - - - e - . - - - - - - -- 239. 40 - - - - �1 - - - - - - - - - - ------ --- -- ]1313 PLOT -- 9539 ---f----- 239.40 f-�----- 5900 581.12 ]1314 PLDT t - - - - - - - -------~--- J1315 PLOT 6784 - 1 -------�-------~----~------- - -------~-------- J1316 PLOT 6782 1 r - - - - - - - 1--------~- ---~-------- ---~--- J1319 PLOT ---------------------�- 3947 --------------f.------ ]1322 PLOT 9537 1------- f-�----- --------------- ]1323 PLOT 3945 f------- ---- ]1327 PLOT 4941 J1328 ---- ------~ ~~- PLOT 9507 --- 239.40 ]1330 PLOT 9538 239.40 Jl331 PLOT 3946 2J 7.68 J1332 PLOT 9036 239.40 Jl333 PLOT 9510 239.40 Jl334 PLOT 9033 160.71 Jl335 PLOT 9032 160.71 Jl336 PLOT 9034 239.40 Jl337 PLOT 3951 526.02 Jl338 PLOT 5902 510.28 J1339 PLOT 5899 573.25 Jl341 PLOT 5901 510.28 Jl342 PLOT 3948 518.16 Jl343 PLOT 3949 518.15 J1344 518.16 J1345 t----~-- 3952 541.77 - - - - - - - f-.-- PLOT 3950 - PLOT J1346 PLOT 5903 J1348 PLOT ]1350 PLOT ---~------ ~------ 9545 - - - --~--------- 9541 -J-13-51-1P-L-O-T------- - - - - - - - 9542 ]1353 PLOT - - - - - - - - 1---~-- 9527 ]1355 PLOT ------�-------------------\- 6400 ]1356 PLOT ]1358 PLOT ~--------- -- ]1360 PLOT 9511 1 - - - - � -t---� 9509 C------ ]1361 PLOT Jl365 PLOT 3848 160.71 160.71 -- ----~---~ 217.68 3944 f - - - - - -----~--- 3846 J1366 PLOT 9543 239.40 Jl367 PLOT 6059 239.40 J1370 PLOT 3845 239.40 J1375 PLOT 6470 - - - - -- ~17.68_ { -- -----------------------

CTA Case No. 8243 Page 38 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION Jl379 PLOT 9535 239.40 ]1380 PLOT 9536 239.40 J1382 PLOT 3844 16, 200.00 ]1383 PLOT 3847 19, 980.00 ]1384 PLOT -- 6476 - - \--------~------ 239.40 r-- ------1-- 4942 -- 160.71 ]1385 PLDT --~----- r------ +---- 6477 151.09 - - -r---~--------� ----~~- J1387 PLDT 3838 160.71 f----�- ----------- J1388 PLDT 6493 239.40 r - - - - - - 1----~---~- f.---~~~~- -~---~----- J1389 PLDT ~---�~- --~----~-� J1390 PLDT 1264 964.29 -~---- ---~-~---- --~-- ]1392 PLDT 6399 --!- ---�� 4482 J1393 PLDT - - ----~~~---� r---~- r - - - - - � - - - - 1442 ]1394 PLDT --~------ f------~-~---- f---- 3833 J1395 PLDT ---~---- - - - - - � � - - - f--- -- 3832 --~---��-- ]1396 PLDT -----~------- ---~- 6495 -- -- J1397 PLDT --~~~~~-----~ -------------~ ]1399 PLOT 6478 239.40 J1400 - - 1----~-- -~---~~------- 6471 PLDT ]1401 PLOT 6475 160.71 ]1402 PLOT 6497 160.71 ]1403 PLOT 6469 239.40 ]1404 PLOT 3840 239.40 J1405 PLOT 3836 239.40 ]1406 PLOT 6403 239.40 ]1407 PLOT 3843 239.40 ]1408 PLOT 6487 239.40 ]1409 PLOT 6483 239.40 ]1410 PLOT 4943 239.40 ]1411 PLOT 3839 239.40 ]1412 PLOT -+--~ 3841 239.40 J1413 6694 239.40 J1414 PLDT 6485 239.40 �- PLDT J1415 PLDT 6467 151.09 J1419 PLDT 6473 239.40 Jl420 PLDT -- ----- J1421 PLOT 6468 239.40 ! - - - - - - - --~-~--- -~-- 6481 239.40 Jl422 PLDT 3842 239.40 J1423 PLDT - - - - -1-- 6472 --~- 239.40 PLDT 6480 160.71 J1424 PLDT -------- 6488 ----- 160.71 J1425 PLDT - 4944 J1428 PLDT 6489 33,815.43 J1429 PLDT 6486 l-- r---- 160.71 ]1430 160.71 ]1432 PLOT 1297 239.40 ]1433 PLOT 6401 239.40 J1434 PLDT 1441 239.40 ]1435 PLOT 6492 - - - - - - - - � -__3_~~68 ( -------~--

CTA Case NQ. 8243 Page 39 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Dl:CISION J1436 PLOT 6474 239.40 J1437 PLOT 4744 239.40 11439 PLOT 6490 239.40 11440 PLOT 6498 8,303.31 J1441 PLOT 4510 160.71 J1442 PLOT J1443 PLOT -~1 - - - - - - - - ---------- J1444 PLOT J1445 PLOT 6695 239.40 1 - - - - - - - - - ----------~------ 239.40 --------- 6402 --- -~ --~-----~- 217.68 6491 217.68 ---------- 3837 J1446 PLOT ------1--- 6496 239.40 ----- J1447 PLOT 239.40 J1448 PLOT 6479 239.40 --- 239.40 - - ---� 239.40 6693 239.40 Jl449 PLOT 239.40 J1450 PLOT ----~---- -~------ 19,980.00 - 3835 J1451 PLOT - - -------~----�-- J1452 PLOT 6484 J1455 PLOT -----~---- 6483 ----- 6494 -----~-- 7135 J1457 PLOT 6783 308.18 J1458 PLOT 3834 217.64 J1494 Smart Communications, Inc. 17 192.86 ]1497 Smart Communications, Inc. 16 308.57 J1498 Smart Communications, Inc. 20 494.74 Sub-total 200,241.(}5 4. !nput VAT SU(Jported by ZERO RA TEO pf(icial receipt J1214 Great Year Industries Corporation Manila 530 102,464.20 Sub-total 1 (}2,464.20 5. Input VAT supported by TIIV official receipts J1280 Leaves & Branches Enterpnses 3714 7,108.93 J1281 Leaves & Branches Enterprises 3747 7,108.93 J1282 Leaves & Branches Enterprises 3895 4,714.29 Sub-tot1:1l 18,932.15 --~ - - - - - - - - - 6. Input VAT supportfJd by official r(!ceipts aot in the name ofpetitioner J1301 P&L Resources, Inc. 3752 2,734.29 --+------ - Jl302 P&L Resources, Inc. - - r--- 3753 4,191.43 J1303 P&L Resources, Inc. 3754 5,776.07 r-- -~-- --+------- J1304 P&L Resources, Inc. ----- 3755 4,932.86 Sub-total ----- 17,634.65 -~---- 7. Input VAT supported by official receipts imprinted with the phrase "not v.alid spurce ofinput tax" J1471 Product PrOviders, Inc. 24993 1,128.00 1,128.00 J1472 Product Providers, Inc. 25163 375.00 J1495 Smart Communications, Inc. 6776 375.00 192.86 J1496 Smart Communications, Inc. 4589 3,198.86 J1499 Smart Communications, Inc. 6777 .c 140,066.10 Sub-toti11 8. Input VAT on purch1:1ses ofservices without suppprting official receipts I 6-3 Property Holdings, Inc: I 0647

CTA Case No. 8243 Page 40 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Pt:CISlON --=-~--~~r-~�~--~---------__---~----- 6-3 Property Holdings, Inc. - 6-3 Property Holdings, Inc. ----~--- - 6-3 Property Holdings, Inc. =t -~----- -------~-~----� 6-3 Property Holdings, Inc. 7,776.00 - Cravings Food Services, Inc. 7098 8,678.57 - CRV Aircon & Plumbing Services 1027 13,676.79 - DHL Express Phils. Corp. 1250453 100.80 DHL Express Phils. Corp. 1250931 6,251.80 - DHL Express Phils. Corp. 1251021 3.60 DHL Express Phils. Corp. 1308241 967.60 - Dig1tal Telecommunications 189,017.28 - Digital Telecommunications 189,017.28 - Digital Telecommunications 189,979.20 - Digital Telecommunications 193,586.40 - Dig1tal Telecommunications 193,626.48 - Fuji Xerox Philippines, Inc. 86608 40,529.45 - Globe Telecom, Inc. ~~--~-- GTWRBD08027907 204.00 8022718 - - 8027798 -~---�-- 6036089 1-- Globe Telecom, Inc. 6355190 204.00 - -~----~-- - Globe Telecom, Inc. --- -~-�---- - Globe Telecom, Inc. -~----- Innove Communications, Inc. - Innove Communications, Inc. 6355561 - Innove Communications, Inc. 6187557 - Innove Communications, Inc. -----~--~ 6184053 - Innove Communications, Inc. 6354280 - - 1----~ 56804 - Maxicare Healthcare Corp. - Maxicare Healthcare Corp. 65148 - Maxicare Healthcare Corp. 56018 -~----~----- ---�---~~ - MMLDC Foundation, Inc. 15729 17,098.20 Philippine Vendmg Corporation 5,335.47 PLDT 8,507.70 PLDT 31,482.18 - Prem1um Security & Investigation Agency, Inc. 50917 2,854.21 - Premium Security & Investigation Agency, Inc. 51153 3,709.46 - R.S. Bernaldo & Associates 2970 36,000.00 53471 289.29 - - SGV & Co. - Sinclair Knight Merz 1196 19,440.00 - Smart Communications, Inc. 8 558.71 - II Smart Communications, Inc. 26 375.00 - Smart Commuoieatioos, Joe. 28 192.86 - art Communications, Inc. 27 535.71 Sub-total -~--- ---~--~~-~ 2,15~115.86 Grand Total --- - - - -------------- -- ----- p 41,000,124.19 -- --- - - - - - -� ------ ~--- Moreover, part of the total input VAT claim of P58,385,248.41 is the amount of Pl,500,608. 79,<

CTA Case No. 8243 Page 41 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Dt:CISION representing petitioner's input VAT on purchases of capital goods exceeding Pl,OOO,OOO.OO. Pursuant to Section 110(A) of the NIRC of 1997, as amended, as implemented by Section 4.110-3 of RR No. 16-2005, input VAT claim on capital goods purchases attributable to zero-rated sales may be claimed either in full during the month of acquisition, or spread over a period of time, depending on the aggregate acquisition cost of the capital goods in the calendar month. If the aggregate acquisition cost exceeds Pl,OOO,OOO.OO, the claim for input tax should be spread over 60 months or the estimated useful life of the capital goods, whichever is shorter. On the other hand, if aggregate acquisition cost does not exceed P1,000,000.00, the total input taxes shall be allowed as credit/refund in the month of acquisition. Thus, while petitioner was able to substantiate the amount of P1,472,164.08 out of the total claimed input VAT of P1,500,608. 79 on capital goods purchases exceeding P1,000,000.00, only the amortization for the first quarter of calendar year 2009 in the amount of P48,902.99 may be claimed by petitioner as valid input tax credits for the same taxable quarter, as determined below: Monthly Exhibit Supplie Dale of Amounl or Input VAT Input Tax Amortization Invoice p Credit 59 B13 Accent Micro TechlQr Q!Qgies, Inc. 19 Jan 09 p f..~~-- 2,078.~7 31.61 p 103.93 -~---~- --~ 19-Jan~09 -~- / 018.~~ ��---~-- J344 +--Accent Micro _T~ecohgies,lnc. 19-Jan-09 91,90~.86 __ _li:�i__ - ---- __!Q3 9::L ~------ J34~ Accent Micro Technologies, 1nc. -B-1-6- Accent Micro Techr1oloqies, IrIC. . 20 Jan 09 ~----~----- ______8_.0'"i -----~----~:1..!_') J34/_ Accent Micro Tech1lOIOgies, Inc. /0-Jan-09 -- 8.0~ /4.1~ J348 Accent Micro Technologies, Inc. 70-Jan-09 --~---------- ~----~- ~4 61 163.8/ r--1319 Accen-t -M-ic-ro-T-e-ch-r I C. -2-6 J-an-09- 1-----! _____ l'l~ill.Q,_QQ________1_26b~~- _______2J87.'"i0 _ J3~0 Accent Micro Tech noiQ~L Inc. /9-Jan-09 ----~l:'!L~~- ------~c~ -----~-l~L!i J3~1 Accenl Micro Tech1lologies, Inc. /9-Jan-09 4,8/1.43 80.36 /41 .0/ B52 Accent Micro Techr1ologj~IrIC. 29 Jan 09 -----�-__;-g,_!__~-83 ____l,!!_!i_Z.11 ----~61.29. -~-~---19_2,86 3-Fcb-09 1------ ~-~~~!!_btotaL_ _ --- ~28, 2,30~,!Z _____ .1_09,!!~6.8�. --~---- ___!~,493.84 J3~3 Accent Micro Technologics, Inc. 31 ,/~0 00 3,1~0.00 6/.~0 1/~.00 _1}51_ Accent Micro Technoloqies, !!:~- __l�~~ 09__ 1J.62,61_b83 ____!o3,'"ilZJ_1_~ ___b_Z25,29 __ '"i,1'"iQ~Z__ ---~~----------~- ______!!i22 J3~~ f--Ac~n_l_ MiC_!"_Q Tech_1loiQg_ics,__!_nc_. _ _ ~-_ Fcb_ -0o:9:.___ +-----_ __2~2~1..:'!2. _____ J.,478c~L ~ ---~L!.'!__ 1)00 J3~6 Accent Micro Technologies, Inc. 10-Fcb-09 6,/~0 00 1~0.00 1/ )0 __n_r;7__ Accent Micro TechnoiO!Jies, Ir~~:,____ t---1-Q Feb 09 _ ____S!,2'lQ,_QQ~ ---�~-~7'lQJ!Q_ ______ 12,')0 _______25j!Q --------~~-~ ,Jit1~-f ~ ,~,;;;~f--j~a --~~j~ ~ J3~8__~ccenl Micro Technologics,Jn_c._ 11-Fcb-09 ____ 2.,'!JL~0_ ----_1J_~9,3h00 ~-----!�.J,!_Z~OO ~-2Llli~~ J3~9 Accent Micro Technologics, Inc. 19-Fcb-09 ------ B60 Accent Micro Tech nolo!~_!!:1<_:_,__~9 Feb 09 f--.:!36 I +- Accenl Micro Technolog!CS, Inc. 19-Fcb-09 J367 Accent Micro Technologics, Jnc. /~-Fcb-09 ---�-- ------~-- ~9 This is based on the estimated useful life of 60 months since the Court cannot determine the actual life of the capital goods.

CTA Case No. 8243 Page 42 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION B63 Accent Micro TechnolocJies1 Inc.. 25 Feb 09 --~-3~711"~~- f- ---_j_,2H5.7_!_-I--_ _ 71.13 --~---11~,!!6 J364 //-Feb-09 /1 .43 Accenl Micro Technologies, Inc / /-Feb-09 11,8~1-1L [ - - _ _2, 14/.86 3~./1 6,60/.14 3-Mar-09 -- 13-Mar-09 J36~ Accenl Micro Technologies, Inc 13 Mar09 1,6~ 1,18~-~~ 198,/14./9 3,303 ~/ 1 /-Mar-09 r - - Subtot~--~- 7 018 851.84 --�- 8-'-42='--'26"--'2'-'-.2__2--t-------t---~075.41 --~ ,--1}66 Accenl Micro Technologi=e-s.!_llf__-- 3/,946.4/ --~ - - -~-3,2_~3-~/ --~6-~~2. - - - 6~.89 J36/ Accenl Micro Technologies, Inc 4~~.3~/.1 I 910.11 910./1 B6H Accent Micro Technoloc~iers_1.c. _ 2112'>1-00-0.-00- - - - 255,000.00 ~--~ 250.00 -~ 1,25Q_,OO J369 Accenl Micro Techno~lo!ie! s, 1c~ . ~3.~/1.4/ - 6,4/8.~ 10/.14 _ _ _ _!0/ 14 -~ Subtotal 2,6~6,875.01 3 20,(!25.0() 5,333.71 Grand Total p 12,;l68,034.02 p 1,472,164.08 p 48,902.99 Accordingly, the unamortized portion of the input VAT in the amount of P1,423,261.09 (P1,472,164.08 less P48,902.99) shall be deducted from petitioner's input VAT claim. In sum, petitioner's substantiated input VAT amounts to P10,795,843.81, and only the input VAT amount of P2,701,413.70 is attributable to petitioner's valid zero-rated receipts of P289,872,951.07, as computed below: lnpul VAT claimed for Refund p ~8.38~,/4841 Less: Disallowances ~--~--------- --~----~- ___ __ Per !CPA Findin~)S (Annex A.1 to A.1) P5,166,019.32 t-----::c--:--c- Findir~-~--~--~- f-----'-P-=er__::tt=liS_QlUrt's Input VAT on Purchases of Goods and Services Unamorli;ed lnpul VAT on Capilal Goods exceeding P1 M- - + - - - - - - - - Valid Input: VAT ------~~--------------+ Multiply by Valid Zero Rated Receipts Divided by Tolal Declared ReceiQ=Ls_:-:-:---~-~--t- Valid I~putVAT attributab!~to valid zero-rated rece!~-- However, since petitioner did not submit the invoices/official receipts proving the existence of its reported input VAT from previous quarter, its output VAT liability for the first quarter in the amount of P567,254.03 shall be offset against the substantiated input VAT attributable to VATable receipts in the amount of P44,053.43, and to zero- rated receipts in the amount of P523,200.60, as herein determined: VAT Allocation: vATaill.;s;;le~- Zero-Rated Sales ~t-. To..;;;----~ Per VAT Returns --~1J1ZJ:16.9~ _____f..::.t.1153~1.1.9.28..3.9_~1�1~5!h_4.39,045.31_ ~lid Input VAT Allocation ---~Q53.436~-j -~~--- 10,751t.Z_20.386~ _____1QJ95,843~81 Output VAT Allocation 523,200.6062 44,053.43 567,254.03 ..( 60 P4,727,116.92/Pl,l58,439,045.31 X Pl0,795,843.81 61 Pl,153,711,928.39/Pl,158,439,045.31 X P10,795,843.81

CTA Case No. 8243 Page 43 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR Pt:CISION Hence, only the input VAT of P2, 178,213.10, as computed below, may be refunded to petitioner: Valid Input VAT attributable to valid zero-rated receipts P 2/0L413.70 Less: Output VAT allocated to zero-rated receipts 523,200.60 ~~f~!l!i~lli~JnpytV~T_____ _ .... _ P~~J7~t~!~�!Q. Even though the claimed input VAT was carried over by petitioner in the succeeding Quarterly VAT Returns in 200963 and 201064, the same remained unutilized until it was deducted65 from petitioner's total available input tax in the fourth quarter of 2010. Consequently, the subject claim no longer formed part of the excess input VAT of P264,856,936.5266 as of the fourth quarter of 2010 which was carried over/applied to the succeeding first quarter of 2011. 67 WHEREFORE, premises considered, the present Petition for Review is hereby PARTIALLY GRANTED. Accordingly, respondent is hereby ORDERED TO REFUND OR TO ISSUE A TAX CREDIT CERTIFICATE in favor of petitioner in the amount of P2,178,213.10 representing the latter's unutilized input VAT attributable to its zero-rated sales for the first quarter of 2009. 50 ORDERED. GiLt N. M0LA..~ C~ CJt:LITO N. MiR'DARO-CiRULLA Associate Justice 62 P567,254.03- P44,053.43 63 Exhibits "D", "E", and "F". 64 Exhibits "G-1", "H", and "I". 65 Line 230, Exhibit "J-1-a". 66 Line 27, Exhibit "J 1-a". 67 Line 20E, Exhibit "K".

CTA Case No. 8243 Page 44 of 44 Deutsche Knowledge Services Pte Ltd. vs. CIR DECISION WE CONCUR: ROMAN G. DEL ROSAR!O Presiding Justice CERTIFICATION Pursuant to Article VIII, Section 13 of the Constitution, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court's Division. ROMAN G. DEl ROSAR!O Presiding Justice Chairperson, 1st Division