VILLAGE-GREEN HOG FARM, INC. v. COM. KIM S. JACINTO-HENARES, COMMISSIONER OF INTERNAL REVENUE

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY SECOND DIVISION VILLAGE-GREEN HOG CTA CASE NO. 8375 FARM, INC., Members: Petitioner, CASTANEDA, JR., Chairperson CASANOVA, and -versus- COTANGCO-MANALASTAS,JJ. COMMISSIONER OF Promulgated: INTERNAL REVENUE, AUG 01 2014~ Respondent. 17 J.'l.f ,. ,. . X- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - X DECISION COTANGCO - MANALASTAS,~ : STATEMENT OF THE CASE This case involves a Petition for Rcvicw1 filed by petitioner Village-Green Hog Farm , Inc. , on November 11 , 2011 pursuant to Section 228 of the National Internal Revenue Code of 1997 (1997 NIRC), as amended, in relation to Section 7 (a)(1) of Republic Act (RA) No. 1125, as amended by RA No . 9282 , and Section 3(a)(1) of Rule 4 of the Revised Rules of the Court of Tax Appeals. Petitioner appeals the decision of the respondent Cornmissioncr of Internal Revenue denying petitioner's protest of the Formal Leiter of Demand2 and Assessment Notices,3 all dated May 21, 2010, which assessed petitioner for deficiency income tax and expanded withholding tax (EWT) for the taxable year 2007 amounting to SEVEN MILLION EIGHTY- ONE THOUSAND ONE HUNDRED THIRTY-SEVEN AND 00/1 0 0 (P7 ,081 , 137.00) , inclusive of interests. ~ I Docket, pp . 10 35 . 2 Exhibit "BI3" . .1 Exhibits "BB-8" & "I3I3- 10"

DECISION Page 2 of 10 CT./\ Case No . 8375 Village-Green Hog Farm, Inc. us CIR STATEMENT OF FACTS Petitioner Village-Green Hog Farm, Inc. (VGHFI) is a corporation organized and existing under Phillppine laws with address at 12 Samar Avenue, South Triangle, Diliman, Quezon City. 4 Respondent is the duly appointed Commissioner of Internal Revenue vested with authority to exercise the functions of said office, including inter alia, the power to abate or cancel a tax liability when the tax or any portion thereof appears to be unjustly or excessively assessed, and holding office at the BIR National Office Building, Diliman, Quezon City. s On tJuly 21, 2008, a Letter of Authority6 (LOA) No. 00039501 dated July 18, 2008 was received by petitioner authorizing revenue officers to examine petitioner's books of accounts and other accounting records for taxable year 2007. Along with the LOA is a First Request for Presentation of Records7 dated July 21, 2008 (hereinafter, collectively referred to as "LOA"). In a lcttcr8 dated tJuly 23, 2008, petitioner acknowledged the LOA but did not heed respondent's request for presentation of records, arguing that their 2006 ongoing audit has not been completed. On August 15, 2008, petitioner received a Second Request for Presentation of Rccords9 dated August 12, 2008. Petitioner acknowledged the second request and reiterated that the company's 2006 audit is on-going. 1o On September 1, 2008, petitioner received a Final Request for Presentation of Records 11 dated August 28, 2008. Petitioner reiterated in its letter dated September 2, 2008 that petitioner's 2006 audit is yet to be concluded, but nevertheless undertook to perform partial compllance on October 2008.~ 4 Par. 1, Joint. Stipulation of Facts and Simplification of Issues (JSFSI), docket., p . 200. s Par. 2, JSFSI, docket., p. 201. 6 Exhibit "D". 7 Exhibit "E". s Exhibit "F". 9 Exhibit "G". 1o Exhibit "H" 11 Exhibit "I"

DECISION Page 3 of!IO CT/\ Case No. 8375 Village-Green Hog Fa rm, Inc. vs CIR In a lcttcr12 dated October 27, 2008, petitioner submitted photocopies of some of the documents in partial compliance to respondent's request for documents, and assured that other required documents will be submitted as soon as the ongoing 2006 audit is completed. Respondent issued a Subpoena Duces Tecum13 on March 3, 2009 commanding petitioner to appear on March 23, 2009, and to bring and submit books of accounts and other accounting records for 2007, i.e., General Special Journals, General Subsidiary Ledgers, Sales Invoices & Official Receipts, Expense Vouchers & Purchase Invoices. On March 23, 2009, petitioner's representative appeared without the subpoenaed documents before Atty. Geraldine Llaguno of the Legal Division of Revenue Region No. 7, Bureau of Internal Revenue (BIR) , Quezon City, explaining that petitioner had been submitting documents to the BIR and have undertaken to make full compliance upon completion of the 2006 audit; petitioner's representative likewise explained that the books and records are available for inspection in their office upon at least a day's notice. Atty. Llaguno granted petitioner until March 24, 2009 to bring the subpoenaed documents. Petitioner claims to have submitted for inspection the subpoenaed documents, except for the Expense Vouchers and Purchase Invoices, during the meeting on March 24, 2009. Petitioner declared that it did not leave any of the subpoenaed documents in BIR's custody; this is due to a prior occurrence where petitioner's records were allegedly lost by the BIR. However, the transmittallcttcrH dated March 24, 2009, which contains the list of documents for inspection, was not received by the respondent, petitioner claims that Atty. Llaguno refused to receive the said letter. A letter dated April 2, 2009 was posted by petitioner to the Chief of the Legal Division for BIR Quezon City stating its invitation to the BIR to examine petitioner's books anytime during office hours from Monday to Friday. ~ 12 Exhibit "K". 13 Exhibit "L". 14 Exhibit "0 ".

DECIS ION Page IJ of IJ 0 CTJ\ Case No. 8375 Village-Green Hog Fa rm, Inc. us CIR BIR filed a criminal complaint against petitioner for failure to obey summons, in violation of Sections 5 and 14, penalized under Section 266, in relation to Sections 253 and 256 of the 1997 NTRC. 1s A Post Reporting Notice 16 dated June 2, 2009 was issued by the BIR inviting petitioner to an informal conference where petitioner may present its objections and submit other documentary evidence in support of its claims. The informal conference was held on \June 25, 2009. Petitioner mentioned that the 2006 audit is still ongoing; that it had been communicating with the BTR and complying with the request for documents. Respondent's revenue officer, Mr. Cesar Cabrera, manifested his willingness to visit the company to inspect petitioner's books of accounts as soon as the hearings on the criminal complaint were concluded.l7 In the meantime, on August 10, 2009 a Resolution 18 was issued by the City Prosecutor of Quezon City recommending the dismissal of the criminal complaint filed by respondent against petitioner due to insufficiency of evidence. On April 27, 2010, petitioner received a Preliminary Assessment Notice (PAN)1 9 dated April 20, 2010, assessing petitioner for deficiency income tax and expanded withholding tax for the calendar year December 31, 2007. Petitioner protested the PAN through a lcttcr20 dated May 13 , 2010. On \June 1, 2010, petitioner received a Formal Letter of Demand21 dated May 21, 2010 with the attached copies of Details of Discrcpancics22 and Assessment Notices (Demand No. 39-B -25-07) for deficiency income tax amounting to P7,039,866.37, 23 and for deficiency expanded withholding tax amounting to P41,270.63,21 all dated May 21, 2010 covering /r taxable year 2007 (hereinafter collectively referred to as "FAN"). 15 Exhibit "S" and "T". 16 Exhibit "U". 1"t Memorandum of Petitioner pars. 2 . 15-2. 16, docket, p . 880. 18 Exhibit "Y". 19 Exhibit "Z" . 20 Exhibit "i\A" . 2 1 Exhibit "BB". 22 Exhibit "DB-IJ ". 23 Exhibit "I3I3-8" . 24 Exhibit "I3I3- 10".

DECISION Page 5 of10 CTJ\ Case No . 8375 Village-Green Hog Famt, Inc. us CIR On June 9, 2010, petitioner filed its protest lettcr25 dated June 4, 2010 against. the assessments issued by respondent and requested for the cancellation of the assessments. A Tax Verification Notice (TVN) No. 0019878926 was issued on July 21, 2010 authorizing Revenue Officer Warren Cris Mores to conduct a reinvestigation relative to petitioner's protest. of the FAN. Revenue Officer Mores notified petitioner, through a lettcr27 dated November 8, 2010, that he will be conducting an audit. investigation on November 17, 2010 and advised petitioner 1.o prepare all the listed documentary requirements to facilitate his investigation. On November 17, 2010 and January 6, 2011, Revenue Officer Mores appeared at. petitioner's office 1.o conduct. examination of books of accounts and other accounting records of petitioner pursuant. to TVN No. 00198789. 28 On October 12, 2011, petitioner received the FINAL DECISION29 of the respondent on its protest, reiterating the assessments issued against petitioner for their alleged failure to submit documents in support of their protest. This prompted petitioner to file the subject Petition for Review before this Court on November 11 , 2011. In her Answcr30 filed on January 2, 2012, respondent interposed the special and affirmative defenses, the relevant. portions of which arc quoted below: "5. The assessments for calendar year 2007 in the amounts of P7,039,866 .37 an d P41,270.63 for d eficiency income and expanded withholding taxes, respectively, were issued in compliance with the provisions of Section 228 of t h e National Inte rnal Revenue Code (Nli:-(C) a nd in accordance with existing Revenue Rules and Regulations relative to the right of the petitioner to be informed of the factual and legal bases upon which the assessme nts were made. The factua l and legal bases of the assessments are V stated in the accompanying Schedule "1" or Detail of Discre pancies; ?.s Exhibit "CC". 26 Exhibit "EE". 27 Exhibit "16". ?.8 Memorandum of Petitioner pars. 2 .29 2 .3 0 , docket, p. 883. 29 Exhibit "HH" . 30 Docket, pp. 41 44.

DECISION Page 6 of !10 CTA Case No. 83 75 Village-Green Hog Farm, Inc. vs CIR 6. The disallowance of various business expenses is due to the fact that petitioner failed to produce the required books of accounts and other accounting records thereby failing to substantiate with sufficient evidence the amount of expenses being claimed and their direct connection or relation to the development, management, operation and/ or conduct of the trade and business of the taxpayer; 7. For the reason that petitioner did not comply with the mandate of the Subpoena Duces Tecum validly issued against it, Respondent was constrained to resort to the Rest Evidence Obtainable Rule pursuant to J:.?.evenue Memorandum Circular No. 2 3 -2000, under which 50% of petitioner's claimed deductions was disallowed; 8. Tax assessments by tax examiners arc presumed correct and made in good faith. xxx". On ~January 3, 2012, the Court issued a Notice of Pre- Trial Conference setting the case for pre-trial conference on February 2, 2012. 31 Respondent filed her Pre-Trial Bricf32 on ~January 30, 2012; while petitioner filed its Pre-Trial BrieP3 on January 31, 2012. During the pre-trial proceedings held on March 14, 2012, the parties were ordered to file their Joint Stipulation of Facts and Issues within a period of 15 days. 34 On March 29, 2012, the parties filed their Joint Stipulation of Facts and Simplification of lssucs35 , which was later approved in a Resolution 36 dated April 3, 2012. In the same resolution, the pre-trial was considered terminated. Thereafter, trial proceeded, giVIng both parties the opportunity to present and formally offer their respective documentary and testimonial evidence in support of their claims and contentions. { 31 Docket, p . 15 32 Docke t , pp. 16-18 . 33 Docke t, pp. 19-58. 34 Docket, p . 66. 35 Docket, pp. 200 2 11. 36 Docket , p. 212.

DECISION Page 7 of !10 CTJ\ Case No. 8375 Village-Green Hog Farm, Inc. us CIR The case was submitted for decision on August 13, 2013, taking into consideration petitioner's Memorandum37 submitted on August 1, 2013 and respondent's Memorandum 38 filed on August 5, 2013. STATEMENT OF ISSUES The parties submitted the following issues39 for this Court's determination: "1. Whether the FAN issued by Respondent to Petitioner together with the attached Details of Discrepancies and Assessment Notices (Demand No. 39-B-25-07), all dated 21 May 2010, is void for failure of Respondent to comply with the due process requirements provided under Section 228 of the NIRC and Revenue Regulations No. 12-99. 2. Whether the FAN issued by Respondent to Petitioner together with the attached Details of Discrepancies and Assessment Notices (Demand No. 39-B-25-07), all dated 21 May 2010, is void for having been issued without any basis in fact or in law. 3. Whether the application by Respondent of the so- called "Best Evidence Rule" under Section 6(b) of the National Internal Revenue Code, as amended was valid under the circumstances. 4. Whether Petitioner is liable for alleged deficiency income tax for taxable year 2007 amounting to Php7,039,866.37 inclusive of interest. 5. Whether Petitioner is liable for alleged deficiency expanded withholding tax for taxable year 2007 amounting to Php41 ,270.63 inclusive of interest." RULING OF THE COURT Compliance with the procedural due process requirernents; 37 Docket, pp. 875 894 . 38 Docket, pp. 896 909. 39 JSFSI, docket, pp. 209-210.

DECISION Page 8 of IJO CT/\ Case No. 8375 Village-Green Hog Farm, Inc. vs CIR factual and legal basis of the assessments; Germane to the disposition of the issue on factual and legal basis of the assessment is Section 228 of the NIRC of 1997, as amended, which provides that "taxpayers shall be informed in writing of the law and the facts on which the assessment is made; otherwise, the assessment shall be void." The Court finds that the "Details of Discrepancies attached to the FAN sufficiently complied with Section 228 of the 1997 NTRC. Pertinent portions of the "Details of Discrepancies" are quoted hereunder: I. DEFICIENCY INCOME TAX a. Income payments not subjected to withholding tax (P1,388, 111.00) - Verification disclosed that you failed to subject your Income payments for repairs and maintenance to withholding tax as required under Revenue Regulations No. 2-98, as amended, thus, disallowed as deduction from your gross income pursuant to Section 34 (K) of the Tax Code of 1997, as amended. Xxx b. Disallowed expenses (50% rule) (P12,525,469.00)-In view of your continued and unjustifiable refusal to prove with documentary evidence the correctness of your tax return for the calendar year ending December 31, 2007, this Office has been constrained to resort to the Best Evidence Rule in determining your income tax liability pursuant to Revenue Memorandum Circular No. 23 -2000. Applying the 50% rule of approximation as enunciated the Court in the case of Mariano Zamora, the following expenses were disallowed as deductions from your income, xxx. c. Unaccounted source of cash (P86,372.19)- Verification disclosed that your income payments subject to expanded withholding tax were not reported in the financial statements, as per analysis hereunder, wherein the total difference was considered as unaccounted source of cash which led to the inference that part of your income have not been declared as enunciated by the Court in the case of Perez vs. CTA & CIR L-10507 dated May 30, /--

DECISION Page 9 of 10 CTA Case No. 8375 Village-Green Hog Farm, Inc. us CIR 1958. Therefore, the amount is added in your reported taxable income pursuant to Section 31 of the Tax Code of 1997, as amended. xxx II. DEFICIENCY EXPANDED WITHHOLDING TAX Verification disclosed that income payments fo r repairs and maintenance was not subjected to expanded withholding tax, hence, assessed pursuant to the provision of the Revenue Regulations No. 2-98, as amended. xxx A perusal of the contents of the "Details of Discrepancies" show the factual basis for assessing petitioner for deficiency income tax and EWT, i.e. , petitioner's alleged failure to subject its income payments for repairs and maintenance to withholding tax; alleged refusal/ failure to prove with documentary evidence the correctness of tax return; alleged failure to report in the financial statements those income payments subject to expanded withholding tax. While the legal basis for assessing the taxpayer were Section 34 (K) of the 1997 NIRC, Revenue Regulation (RR) No. 2-98, Revenue Memorandum Circular (RMC) No. 2 3 -2 000 , Section 31 of the 1997 NIRC, and the case of Perez vs. CTA & CIR, L- 10507 dated May 30, 1958. As can be gleaned from the foregoing, petitioner is considered to have been properly apprised of the factual and legal bases of the subject assessment for deficiency income tax, and deficiency EWT all for taxable year 2007. Thus, the subject assessment sufficiently complies with Section 228 of the 1997 NIRC necessitating the taxpayers to be informed of the law and the facts upon which an assessment is based. Further, the fact that petitioner duly protested the assessment clearly bolsters the fact that it was informed of the reasons supporting respondent's findings on its alleged 2007 income tax and expanded withholding tax liabilities. In varying but consistent lan guage, the Supreme Court has ruled that the requirement of the law to inform the taxpayer of the basis of the assessment docs not necessarily mean that it be a lull narration of the facts and laws on which the assessment is based. The purpose of the assessment is to enable the taxpayer to know the law a nd the facts on which the assessment is made, and to afford him his right to due process once it is served and received . Thus, so long as the parties arc notified and given the opportunity to explain their /-

DECISION Page 10 of -10 CT/\ Case No. 83 75 Village-Green Hog Farm, Inc. vs CIR side, the requirements of due process arc satisfactorily complied with.40 Anent the issue on procedural due process requirements referred to in Section 228 of the 1997 NIRC, RR No. 12-99 was issued to implement the same; enshrined in Section 3 of the said regulation reflects the due process requirements in the issuance of a deficiency tax assessment, to wit: (1) a notice for informal conference, (2) a preliminary assessment notice, and (3) a formal letter of demand and assessment notice sent to the taxpayer. The records of this case reveal that, petitioner received the PAN dated April 20, 2010 on April 27, 2010. Petitioner expressed its opposition to the PAN through a letter dated May 13, 2010. On ~June 1, 2010, petitioner received the FAN dated May 21, 2010. Thereafter, petitioner filed its protest to the FAN on June 9, 2010, which respondent denied in the Final Decision dated September 26, 2011 and received by petitioner on October 12, 2011. Undoubtedly, petitioner was notified and g1vcn wide latitude to exercise its option to present its case in the administrative level as it was able to intelligently protest or dispute the subject assessment issued by the respondent. Hence, the Court is convinced that respondent has substantially complied with the requirements of due process, and petitioner was not denied due process or the opportunity to be heard. It has been held time and agatn that the "essence of due process is found in the reasonable opportunity to be heard and submit. any evidence one may have in support of one's defense. What the law proscribes is the lack of opportunity to be heard. As long as a party is given the opportunity to defend his interests in due course, he would have no reason to ?-- complain, for it is this opportunity to be heard that makes up the essence of due process."41 40 Calma, et al. vs. Court of Appeals, e t a l. , G.R. No . 122787, February 9, 1999. 4 1 Estares, et al. vs . Court of Appeals, e t al., G.R. No . 1-1-1755, June 8, 2005.

DECISIO N Page 11 of 10 CT.t\ Case No. 8375 Village-Green Hog Farm, Inc. us CIR Propriety of respondent's use of the best evidence obtainable rule. Petitioner challenges the usc of the Best Evidence Obtainable Rule in determining its deficiency internal revenue tax liability. Petitioner contends that there is no reason for respondent Lo apply the Best Evidence Obtainable Rule when the documents required were submitted and made available to the BTR. Respondent posits that she was constrained Lo resort Lo the Best Evidence Obtainable Rule in view of petitioner's alleged refusal and failure to submit documentary evidence to prove the correctness of its Lax return , despite receipt of the subpoena duces tecum; thus , 50�/o of petitioner's expenses as indicated in its Annual Incom e Tax Return (TTR) for taxable year 2007 were disallowed by respondent. Simply put, the expenses of petitioner were disallowed due to petitioner's failure to substantiate the amount of said expenses. The disallowance of 50�/o of the expenses of petitioner was based on Section 6(B) of th e NTRC of 1997, as amended , as implemented by RMC 23-2000, specifically Sections 2.3 and 2.4(c) thereof, viz: Republic Act No . 8 4 2 4 AN ACT AMENDING THE NATIONAL INTERNAL REVENUE CODE, AS AMENDED, AND FOR OTHER PURPOSES Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled: Section 1. Short Title. - This Act shall be cited as the ((Tax Reform Act of 1997". XXX XXX XXX Section 6 . Power of the Commissioner to Make assessments and Prescribe additional Requirements for Tax Administration and Enforcement. - XXX XXX XXX (B) Failure to Submit Required Returns, Statements, Reports and other Documents. - When a report required by law as a /--

DECISION Page 12 of !10 CTA Ca se No. 8 375 Village-Green Hog Farm, Inc. us CIR basis for the assessment of any national internal revenue tax s h a ll n ot be forth coming with in the time fixed by laws or rules and regulations or wh en there is reason to believe th at any such report is false, incomplete or erroneous , th e Commissioner shall assess the proper tax on th e best eviden ce obtainable. In case a person fails to file a required return or oth er docu men t at t h e tim e p r escribed by law, or willfully or otherwise files a false or fraudulent return or other docum ent, the Commissioner shall make or amend t h e retur n from h is own knowledge and from such in fo rmation as h e can obtain th rough testimony or otherwise, wh ich s h all be prima facie correct and sufficien t for a ll legal purposes. REVENUE MEMORANDUM CIRCULAR NO. 23-00 SURJSCT Sxisting Revenue Procedures on the Assessment of Deficiency Interna l Reve nue Taxe s l3ased on the "13est ~vidence Obtainabl e" TO i\11 Inte rnal Reve nue Office rs and Othe rs Concerned XXX XXX XXX S~CTfON 2 . Prescribed Reve nue Procedures . - 2.3 llssessment Based on JJest Iiuiclence Obtainable. J\n assessment based on best e uidence obtainable is justified when any of the grounds provided by law is clearly established viz: 1. The r eport or r ecords r equested from the taxpayer are not forthcoming i. e . th e records are lost; refusal of the taxpayer to submit such records; 2. The re ports submitted are false, incomplete or erroneous. In every case where a ta xpayer is ordered to be exa mined and he refuses or fails to submit his records giving rise to the issuance of a subpoena duces tecum pursuant to R.MO No. 35-90, th e assessment shall only be issued after a crimina l case h a s been instituted for failure to obey summons. f After filing of the compla int against the taxpayer for viola tion of the Subpoena Duces Tecum, the Legal

DECISION Page 13 of IJ 0 CTJ\ Case No. 83 75 Village-Gree n Hog Farm, Inc. us CJR Division/ Prosecution Division shall immediately return the docket of the case to the concerned Revenue Officer. The Revenue Officer shall, upon receipt of the docket, immediately proceed to determine the taxpayer's deficiency internal revenue lax liability m accordance with the "l3est ~vidence Obtainable ." 2.4 Existing Hevenue J)rocedures and ,Jurispnulence Governing 1\ssessrnenl Based on the nest Evidence Obtainable. - Provided hereunder arc the existing revenue procedures and jurisprudence governing issuance of a deficiency tax assessment based on the best evidence obtainable: XXX (c) 1\ssessrnenl Based on Estimate; 50% Hule, in the 1\hsence c~{ Heceipts lo Prove 1\ctual 1\rrwurd q{ Rxpense Deduction. - The Court held in the Mariano Zamora case tha l, if there is a showing that expenses have been incurred but the exact amount thereof cannot be ascertained due to absence of documentary evidence, it is the duty of the RIR to make an estimate of the deduction that may be allowable in computing the taxpayer's taxable income, bearing heavily against the taxpayer whose inexactitude is of his own making. That disallowance of 50% of the taxpayer's claimed deduction is valid. In this regard, Section 34 (A) (1) (b) of the NTRC of 1997, as amended, provides that one of the requirements for the dedu ctibility of an expense is: "S~C . 34 . Deductions from Gross Income. - . (A) ~xpenses.- (1) Ordinary and Necessary Trade, Business or Professional ~xpenses. - (b) Substantiation Requirements. - No deduction from gross income shall be allowed under Subsection (A) hereof unless the taxpayer shall substantiate with sufficient evidence, such as official receipts or other adequate records: (i) the amount of the expense be ing d educted, and (ii) the direct connection or rela lion of the expense being deducted to the development, management, operation and/or conduct of the trade, business or profession of the taxpayer." ~

DECISION Page 1tJ of tJ 0 CTI\ Case No. 837 5 Village-Green Hog Farm, Inc. us CIR For an expense to be deductible, it must be substantiated by official receipts or adequate records; that generally, the BIR only accepts the original copy of the receipt/ s , which a taxpayer presents to substantiate deductible expense; nevertheless, the absence of original receipts or records docs not prevent a taxpayer from proving by other evidence that the claimed deduction was really paid or incurrcd. 11 2 In this case , however, a scrutiny of the evidence on record reveals that petitioner failed io present io respondent any supporting evidence to substantiate the amount of the expenses that have been incurred and the direct connection to petitioner's trade or business of said expenses. Record shows that respondent repeatedly requested petitioner to present its books of accounts and other accounting records io substantiate the aforesaid expenses. In fact as early as ,July 21 , 2008 , LOA11 3 No. 00039501 was received by petitioner authorizing revenue officers to examine petitioner's books of accounts and other accounting records for taxable year 2 007. Along with th e LOA is a First Request for Presentation of Rccordsv1 dated July 21 , 2008. In a lettcr!J 5 dated July 2 3 , 2 008 , petition e r merely acknowledged the LOA but did not heed respondent's requ est for presentation of records, arguing thai their 2006 ongoing audit has not been completed. Thereafter, on August 15, 2008 , petitioner received a Second Request for Presentation of Records46 dated August 12, 2008. However, despite the second request, petitioner again simply acknowledged the second request a nd reiterated thai the company's 2006 audit is on-going. 11 7 Hence, on September 1, 2008, petitioner received a Fina l Request for Presentation of Rccords11 8 dated August 2 8 , 2008 . Petitioner reiterated in its leiter dated September 2, 2 008 thai petitioner's 2006 audit is yet to be concluded, but nevertheless undertook to perform partia l complia n ce on October 2008. In{- 42 BIR Ruling No. 02 7 01 d a ted June 2 0 , 2 001 , citing the cases of Zamora vs. Collector (8 SCRA 163) and Visayan Cebu Termina l Co ., Inc . vs . Collector (180 Phil. 32 0) ex pressly provides tha t 43 Exhibit "D". 44 Exhibit "E". 45 Exhibit "F". 46 Exhibit "G". 47 Exhibit "H" 48 Exhibit "I"

DECISION Page 15 of IJO CT/\ Case No. 8375 Village-Green Hog Farm, Inc. us CIR a lettcr1 9 dated October 27, 2008, petitioner submitted photocopies or some or the documents in partial compliance to respondent's request for documents. The Court notes, however, that the expense vouchers, purchase invoices and other adequate records that could substantiate the amount of the expenses that have been incurred and the direct connection to petitioner's trade or business of said expenses, were not included among the submitted documents. Finally , respondent issued a Subpoena Duces Tecumso on March 3, 2009 commanding petitioner to appear on March 23, 2009, and to bring and submit books of accounts and other accounting records for 2007, i.e., General Special Journals, General Subsidiary Ledgers, Sales Invoices & Official Receipts, Expense Vouchers & Purchase Invoices. Notwithstanding the issuance of the subpoena, petitioner's representative appeared without the subpoenaed documents on March 23 , 2009 before Atty. Geraldine Llaguno from the Legal Division of Revenue Region No. 7 , Bureau of Internal Revenue (BIR), Quezon City. Atty. Llaguno granted petitioner until March 24, 2009 to bring the subpoenaed documents. During the meeting on March 24, 2009, petitioner claims to have submitted for inspection the subpoenaed documents, except for the Expense Vouchers and Purchase Invoices, however, petitioner admits that it did not leave any of the subpoenaed documents in BIR's custody due to a prior occurrence where petitioner's records were allegedly lost by a BIR personnel. The transmittal letter51 dated March 24, 2009 , which indicates the list of documents for inspection, was not received by the respondent, petitioner claims that Atty. Llaguno rcfu sed to receive the said letter. In the above scenario, even if the allegations of petitioner were true, the Court once again notes that the expense vouchers, purchase invoices and other adequate records that could substantiate the amount of the expenses that have been incurred and the direct connection to petitioner's trade or V business of said expenses , were not included among the submitted documents to respondent. 49 Exh ibit "K". 5o Exh ibit "L". 5 1 Exhibit "0 ".

DECISION Page 16 of 10 CT/\ Case No. 8375 Village-Green Hog Famt, Inc. us CIR The Court docs not subscribe to petitioner's defense that it has invited the BTR to examine petitioner's books and that its books arc open for examination by BIR officers in its office during office hours. A subpoena duces tecum had already been issued, and the instruction in the said process is clear, i.e., to bring with you and s ubmit books of accounts and other accounting records for 2 007 consisting of the following: General Special Journals, General Subsidiary Ledgers, Sales Invoices & Official Receipts, Expense Vouchers & Purchase Invoices. Subsequently PAN and FAN were issued against petitioner. In the course of the reinvestigation, which was granted when petitioner protested the FAN, RO Mores notified petitioner, through a letter52 dated November 8, 2010, that he will be conducting an audit investigation on November 17, 2010 and advised petitioner to prepare all the listed documentary requirements to facilitate his investigation, i.e., general ledger, sales and purchases books, subsidiary sales and purchases books, sales invoices and/ or official receipts, check and journal vouchers, other documents necessary for the audit. During the audit investigation conducted at petitioner's place of business, when RO Mores requested for the summary of operating expenses, petitioner's representative did not provide the said document and simply responded that its summary of operating expenses was already submitted to the BTR. Petitioner's claim that RO Mores did not ask to look at petitioner's check vouchers supporting the expenses is unavailing. RO Mores conducted the audit investigation pursuant to petitioner's request by means of a protest, thus, these documents should have been prepared and provided outright, RO Mores need not ask to look at the said documents. Furthermore, petitioner was already notified thru a letter dated November 8, 2010 to prepare the documents itemized in said letter to facilitate the investigation. Clearly, there was utter refusal and failure on the part of the petitioner to submit to respondent adequate records that could substantiate the amount of the expenses for taxable year 2007. Anyone, who traces the series of events and chain of /r- communications by and between the parties, will certainly notice this one glaring fact , i.e., the documents/records s2 Exhibit" 16".

DECISION Page 17 of IJO CT/\ Case No. 8375 Village-Green Hog Farm, Inc. us CIR (expense vouchers, purchase invoices and other adequate records), that could substantiate the amount of the expenses that have been incurred for taxable year 2007 and the direct connection of the said expenses to petitioner's trade or business, were not included among the submitted documents during the entire administrative proceedings; either before or after the issuance of the PAN, FAN, and Final Decision on petitioner's protest. On the basis of the foregoing facts and circumstances, the Court is convinced that, during the entire administrative proceedings, petitioner did not and was not able to substantiate the claimed expenses in its 2007 Annual TTR. Hence, resort to the Best Evidence Obtainable in assessing pctltloncr for deficiency income tax by disallowing 5 0 �/o of petitioner's expenses is justified and in full accord with Section 6 (B) of the NIRC of 1997, as amended, as implemented by RMC 23-2000, specifically Sections 2.3 and 2.4 (c) thereof. This Court shall now proceed to resolve the remaining issues as to whether petitioner is liable for deficiency income tax and expanded withholding tax. Whether petitioner is liable for deficiency incom.e tax and expanded withholding tax Just like other assessment cases, the timeliness of the filing of the Petition for Review must first be ascertained. Relevant to the determination of the timeliness of the instant Petition for Review is Section 228 of the National Internal Revenue Code (NTRC), as amended, vrz: "SF:C. 228 . Protesting of Assessment. When the Commissioner or his duly authorized representative finds that proper taxes should be assessed, he shall first notify the taxpayer of his findings: . . . The taxpayers shall be informed in writing of the law and the facts on which the assessment is made; otherwise, the assessment shall be void. Within a period to be prescribed by implementing rules and regulations, the taxpayer shall be required to respond to said /,-

DECISION Page 18 of IJO CT/\ Case No. 8375 Village-Green Hog Farm, Inc. us CIR notice. If the taxpayer fails to respond, the Commissioner or his duly authorized representative shall issue an assessment based on his findings. Such assessment may be protested administratively by filing a request for reconsideration or reinvestigation within thirty (30) days from receipt of the assessment in such form and manner as may be prescribed by implementing rules and regulations. Within sixty (60) days from filing of the protest, all relevant supporting documents shall have been submitted; otherwise; otherwise, the assessment shall become final. If the protest is denied in whole or in part, or is not acted upon within one hundred eighty (180) days from submission of documents, the taxpayer adversely affected by the decision or inaction may appeal to the Court of Tax Appeals within thirty (30) days from receipt of the said decision, or from the lapse of the one hundred eighty (180)-day period; otherwise, the decision shall become final, executory and demandable ." In the case at bar petitioner received on June 1, 2010 the FAN (Formal Letter of Dcmand53 with the attached copies of Detai ls of Discrepancies54 and Assessment Notices). Thereafter, petitioner seasonably filed its protest with the BIR on J u ne 9, 2010, or within thirty (30) days from such receipt pursuant to the above provision, therefore, it has sixty (60) days, until August 8, 2010, within which to submit the relevant supporting documents. Records of this case show that petitioner did not submit additional relevant supporting documents within the sixty (60)-day period from the filing of its protest. It bears to stress that "the requirement on the submission of all the relevant supporting documents within the 60-day period from filing protest is merely directory ."55 Also, it is well to remember that "where the taxpayer failed to submit relevant supporting documents within the sixty (60) day period from filing of the protest, and in case of inaction by the respondent and the taxpayer chooses to appeal to the Court of Tax Appeals, the same must be made within thirty (30) days from the lapse of the one-hundred eighty (180) day period, the one-hundred eighty (180) day period must be reckoned from the date the protest was filed. The sixty (60) day period shall not be added{ s3 Exhibit "T3B". 54 Exhibit "llD-IJ" . 55 CJN. us. La Suerte Cigar and Cigarette Factory, et al. , CT/\ EB No . 820 , June 11 , 2012 .

DECISION Page 19 of IJ 0 CT/\ Case No. 8375 Village-Green Hog Farm, Inc. vs CIR to the computation of the one-hundred eighty (180) days because from the wordings of the law, in case the taxpayer fails to submit relevant supporting documents, the assessment becomes final. The one hundred eighty (180) day period, therefore, commenced to run from the date protest was filed. xxx xxx." 56 Hence, consistent with the foregoing pronouncements of the Court En Bane in CJR us. La Suerte Cigar and Cigarette Factory, et al. 5 7, and Oceanic Wireless Network, Inc. us. CJRSB, the 180-day period, should be reckoned from the llling of the protest on June 9, 2010, which ended on December 6, 20 10. Now, in this case, records disclose that respondent failed to act on petitioner's protest within the 180-day period, i.e., on or before December 6, 20 10; and petitioner did not appeal said inaction within the 30-day period from December 6, 2010, which ended on tJanuary 5, 2011; petitioner opted to wait for the final decision or the BIR on the disputed assessment before filing its appeal to this Court. On October 12, 2011, petitioner received the FINAL DECISIQN59 of the respondent on its protest, thereafter, petitioner had 30 days, or until November 11, 2011, within which to appeal to the CTA. Evidently, the instant Petition for Review was timely filed with the Court on November 11, 2011. The option to wait for the final decision of the BIR on the disputed assessment before appealing to this Court is sanctioned both by the Tax Codc60 and jurisprudence. The Supreme Court has held in Lascona Land, Co., Inc. us. CJR that "in case the Commissioner failed to act on the disputed assessment within the 180-day period from date of submission of documents, a taxpayer can either: (1) file a petition for review with the Court of Tax Appeals within 30 days after the expiration of the 180-day period; or (2) await the final decision of the Commissioner on the disputed assessments and appeal such final decision to the Court of Tax Appeals within 30 days after receipt of a copy or such decision."61 ~ 56 Oceanic Wireless Network, Inc. vs. Commissioner of Internal Revenue, CTA EI3 No . 76, June 22, 2006; a lso cited in Fil-Hispano Holdings Corporation vs. Commissioner of Internal Revenue, CTA EB No. 3-13, June 12, 2008 . 57 Supra, Note 55. 58 Supra, Note 56. 59 Exhibit "HI-I". 60 Section 228 of the 1997 NIRC. 6t Lascona Land, Co., Inc. vs. CIN, G.l-?.. No . 171251, March 5, 2012 citing RCBC vs. CIR, G.R. No . 168198, April21J, 2007, 522 SCRA liJIJ .

DECISION Page 20 of 10 CTJ\ Case No. 8 37 5 Village-Green Hog Farm, Inc. us CIR After having established petitioner's compliance with the timeliness requirement in disputing an assessment pursuant to Section 228 of the 1997 NIRC , the Court shall now determine the merits of the alleged deficiency income tax and deficiency expanded withholding tax for taxable year 2007. A. DEFICIENCY INCOME TAX - P7,039,866.37 The alleged deficiency Income tax amounting to P7 ,039 ,866.37 resulted from (1) Income payments not subjected to withholding tax, (2) disallowed expenses (50�/o rule), and (3) unaccounted source of cash. Below is the respondent's detailed computation of the alleged deficiency income tax62: Taxable Income p er ITR P12 0 ,375. 00 _Add _: Adju stmcn t ~ p cr I nvcs tig~tion Income paymen t not s ubjected to withholding tax p 1,388, 11 1. 00 12,525,469.00 Disallowed exp enses (50%) _8 6,372 . 19 - - -U- n a c- c o u n ted sou rce of cash - 13,999,95 ~ 9 -- - - __! _14, 12 0 ,327:___19 __Iaxablc _Income p er investiga tion - In c om e Tax due th e r eon -- - -- p 4,94~ , 114.52 - - - Less: 1\.llowa.b le tax c redi ts/ pay m e n ts: Payment s 42,131.25 Deficie n cy I n co m e Tax 4,899,983.27 2, 139,883.1 0 l- -Add: 2 0% In terest-p .a . (04 . 16.0-8 to 06.21.1 0) TOTAL AM-O-UNT DUE - P7 ,039,866.3 7 �- - A.l Income Payments Not Subjected to Withholding Tax - P1,388, 111.00 Respondent's verification disclosed that pctltloncr failed to subject its income pay m ents for repa irs and maintenance to withholding tax as required under Revenue Regulations (RR) No. 0 2 -98 , as ame nded , thus , disallowed as deduction from gross income pursuant to Section 34(K) of the NIRC of 1997, as amended. 63 As a testament of respondent 's arbitrary measures in disallowing repairs and mainten an ce, petitioner argues that the Details of Discrepancies did not even provide enough ~ 62 Pa r. 15, Joint Stipula tion of Fa cts a nd Simplification of Issues, Docke t Vol. I, p. 2 06 ; Exhibit "11I3-2" . 63 Pa r. a, Exhibit "1111 -1 ".

DECISION Page 2 1 of 10 CTJ\ Case No. 83 7 5 Village-Green Hog Farm, Inc. us CIR details to enable petitioner to verify the accuracy of said assessment. Respondent failed to indicate the payees as well as the periods or dates when these income payments were made. Thus, it could be possible that petitioner withheld the tax but used a different withholding tax rate or these arc exempt under the circumstances. The only information stated in the Details of Discrepancies wasM: Per Financial Per Difference Statements returns I alpha list Re pairs_a nd maintenance p 1,388,111.00 - p 1 , 388,1 1 1 . 0-0 Income payments not -- subjected to withholding tax P1,3~8__, 111.<:!_<!.._ ~ Further, in its Protest Lcttcr65 dated ,June 4, 2010, petitioner asserted that repairs and maintenance of P1 ,388,111 .00 included labor and materials used in the maintenance and repairs of buildings, equipments, tools, water system and autos. Amounts paid to labor arc within the minimum wages that are exempt from withholding tax. As stated in his Judicial Affidavit66, the Court- commissioned Independent Certified Public Accountant (ICPA), Mr. Arden D. Retales, after the examination and verification of petitioner's voluminous documents, found and concluded that: "(a) The disallowed Repairs and Maintenance Expense in the schedule of discrepancies for the cale nd a r year ending 31 December 2007 at.t.achcd t.o t.hc Formal Lct.t.cr of Demand dated 21 May 2010 issued by respondent. t.o pct.it.ioncr amounting t.o P1,388,111.00 is not. subject. t.o withholding t.ax, is properly substantiated, is a valid business expense of petitioner a nd an allowa blc deduction from pct.it.ioncr's t.axablc income for 2 007 ." However, the Court disagrees with the findings of the TCPA . Based on Section 34(K) of the NTRC of 1997, as amended, an expense/ cost shall be allowed as deduction from gross income only if it is shown that the tax required to be deducted and withheld therefrom has been paid to the BIR. For easy reference , Section 34 (K) is quoted hereinbelow: ~ 64 Par. 3 . 1'1 , Pe titioner's Memorandum, Doc ke t Vol. III, p . 889. 6s Exhibit "CC", p . 2 . 66 Exhibit "MM", Q&A no . 18 , Docke t Vol. II , p . 111.

DECISION Page 22 of IJ 0 CT/\ Case No. 837;) Village-Green Hog Farm, Inc. us CIR "(K) Additional Requirements for Deductibility of Certain Payments. - J\ny amount paid or payable which IS otherwise deductible from, or taken into account m computing gross income or for which depreciation or amortizntion may be allowed under this Section, shall be allowed as a deduction only if it is shown that the tax required to be deducted and withheld therefrom has been paid to the Rurcnu of Intcrnnl Revenue in accordnncc with this Section, Sections 58 and 81 of this Code." Relative thereto, Section 2.57.2(E) and (M) of RR No. 02- 98, as amended by RR Nos. 06-01, 14-02, 17-03 and 30-03, mandates the withholding of 2c% creditable income tax on income payments to certain contractors and on purchases of services by top 10,000 corporations, respectively, to wit: Sec. 2 .57.2 . Income Payme nt Subject to Creditable Withholding Tax and Rates Prescribed Thereon. - Sxccpt as herein otherwise provided, there shall be withheld a creditable income tax at the rates herein specified for each class of payee from the following items of income payments to persons residing in the Philippines: XXX XXX XXX S)lncome payments to certain contractors - On gross payments to the following contractors, whether individual or corporate- Two percc-~ n t (2%) (1)General engineering contrnctors - Those whose principal contracting business in connection with fixed works requiring specialized engineering knowledge and skill, including the following divisions or subjects: (a) Reclamation works; (b) Railroads; (c) Highways, streets and roads; (d) Tunnels; (e) Airports and airways; (f) Waste reduction plants; (g) Bridges, ovcrpnsscs, undcrpnsscs and other similar works; (h) Pipelines and other systems for the transmission of petroleum and other liquid or gaseous substances; (i) Land leveling; (j) Sxcnvating; (k) Trenching; (I) Paving; and (m) Surfacing work. (2) General building contractors - Those whose principal contracting business is in connection with any structure buill, for lhc support, sheller and enclosure of persons, animals, chaUcls, or movn blc properly of any kind, requmng in its construction the use of more than two unre lated building trades or crafts, or to do or superintend{-

DECISION Page 23 of IJ 0 CTJ\ Case No. 8375 Village-Green Hog Farm, Inc. us CIR the whole or any part thereto. Such structure includes sewers and sewerage disposal plants and systems, parks, playgrounds, and other recreational works, refineries, chemical plants and similar industrial plants requiring specialized engineering knowledge and skills, powerhouse, power plants and other utility plants and installation, mines and metallurgical plants, cement and concrete works in connection with the above-mentioned fixed works. (3) Specialty Contractors - Those whose operations pertain to the performance of construction work requiring special skill and whose principal contracting business involves the use of specialized building trades or crafts. (4) Other contractors- (a) Filling, demolition and salvage work contractors and operators of mine drilling apparatus; (b) Operators of dockyards; (c) Persons engaged in the installation of water system, and gas or electric light, hca t or power; (d) Operators of stevedoring, warehousing or forwarding cstablishmcnts; (c) Transportation contractors which include common carriers for the carriage of goods and merchandise of whatever kind by land, air or water, where the gross payments by the payor to the same payee amounts to at least two thousand pesos (1>2,000) per month, regardless of the number of shipments during the month; (1) Printers, bookbinders, lithographers and publishers except those principally engaged in the publication or printing of any newspaper, magazine, review or bulletin which appears at regular intervals, with fixed prices for subscription and sale; (g) Messengerial, janitorial, private detective and/ or security agencies, credit and/ or collection agencies and other business agencies; (h) Advertising agencies, exclusive of gross payments to media; (i) Independent producers of television, radio and stage performances or shows; Ul Independent producers of "jingles"; (k) Labor recruiting agencies and/or "labor-only" contractors. For this purpose, any person who undertakes to supply workers to an employer shall be deemed to be engaged in "labor-only" contracting where such person docs not have substantial capital or investment in the form of tools, equipment, machineries, work premises and other materials and the workers recruited and placed by such person arc performing activities which arc directly related to the principal business or operations of the employer which the workers arc habitually employed; (1) Persons engaged in the installation of elevators, central air conditioning units, computer machines and other equipment and machineries and the maintenance services thereon; (m) Persons engaged in the sale of computer services, computer programmers, software program

DECISION Page 21J of IJ 0 CTA Case No. 8375 Village-Green Hog Farm, Inc. us CIR developer j designer, inlcrncl service providers, web page d e signing, computer d ata processin g, conversion or base services and other computer related activities; (n) Persons engaged in land scaping services; (o) Persons engaged in the collcclion and disposa l of garbage; (p) TV and radio slation operators on sale of TV and radio airlimc; and (q) TV and radio blockt imers on sale of TV and radio commercial spots. XXX XXX XXX (M) Income payments made by the top ten thousand ( 10)000) private corporations to their local/ resident supplier of goods and local/ resident supplier qj" services othe r than those covered by other rates of withholding tax. - Incom e paym enls made by any of the lop len thousand (10,000) private corporations, as determined by the Commissioner, to their local jrcsidcnl supplier of goods and localjrcsidcnl supplier of services, including non-resident a lien engaged in trade or business in the Philippines Supplier of goods - One percent (I%) Supplier of services - Two percent (2%) As aptly found by the ICPA, petitioner is not required to withhold 2�/o EWT as imposed under Section 2.57.2(M) of RR No. 02-98, as amended by RR No. 17-03, on income payments made by top ten thousand (1 0,000) private corporations to their local suppliers of services since petitioner has not been classified and duly notified by the BTR as belonging to the top 10,000 corporations. However, petitioner must prove that its claimed deduction for repairs and maintenance does not fall in any of the aforcquotcd transactions subject to 2o/o EWT under Section 2.57.2 (E) of RR No. 2 -98, as amended. A thorough examination of the documents submitted by petitioner disclosed that repairs and maintenance amounting only to P231 ,409.2467 was duly substantiated in accordance with Section 34(A)( 1)(b) of NTRC of 1997, as amended , which provides: "Sec. 34. Deductions from Gross Income. xxx (/\) Expenses. V (1) Ordinary and Necessary Trade) Rusiness or Professional Bxpenses. 67 See Annex A (1) of this Decision.

DECISION Page 25 of 10 CTJ\ Case No. 8375 Village-Green Hog Farm, Inc. vs CIR XXX XXX XXX (b) Substantiation Requirements. - No dcduclion from gross income shall b e a llowed under Subscclion (A) hereof unless lhc laxpaycr shall substantiate with sufficient evidence, such as official receipts o r other adequate records : (i) lhc amounl of lhc expense being dcdu clcd, and (ii) lhc d irccl conncclion or rclalion of the expense being d educted to the d evelopme n t, managem ent, operation a nd/ or conduct of th e trad e, business or profe ssion of the laxpaycr." (Emphasis supplied) Based on the summary schedule68 prepared by the TCPA, all items listed therein have cash or check vouchers69 . However, these vouchers arc self-serving as they were prepared by petitioner's own accountant and if not corroborated by invoices or official receipts have no evidentiary weight because this Court cannot ascertain that expenses were actually incurred or paid and the true nature of the expenses. In the case of Da Jose vs. Angeles70 , the Supreme Court had the occasion to rule in this wise: "We thus agree with the RTC 's ruling that said cash vouchers though admitted in evidence, whether objected to or not, have no probative value for being hearsay ." Also, the delivery receipts attached to the cash or check vouchers deserve scant consideration. Being a document that merely confirms delivery of an item, a delivery receipt cannot be a valid proof of purchase or payment of an item. Likewise, some of the items cannot be verified either, because the receipts and/ or invoices were unreadable, or because the item cannot be clearly classified as repairs and main tcnancc. Further, the verified amount. of :P231 ,409.24 for repairs v and maintenance was correctly not subjected to EWT as this docs not fall within the purview of Section 2.57.2(E) of RR No. 2-98, as amended. 68 .Exhibit "LLLLLLLLLLLLLLLLLLLL". "ZZZZZZZZZZZZZZZZZZZZZ"; 69 Exhibits "MMMMMMMMMMMMMMMMMM" to "WWWWWWWWWWWWWWWWWWWWWWWWW'' ''WWWWWWWWWWWWWWWWWWWWWWWWWW''. 70G .R. No. 187899, October 23, 2013.

DECISION Page 26 of -10 CTJ\ Ca se No . 8 375 Village-Green Hog Farm, Inc. us CIR Nonetheless, since the rcma1n1ng claimed d ed uction for repairs and maintenance in the amount of P1,156,701.76 (P1,388 , 111.00 less P231 ,409.24) is not duly substantiated, the same shall be considered as subject to 2�/o EWT as prescribed under Section 2.57.2(E) of RR 2-98, as amended, in line with the rule thai t.ax assessments by tax examiners are presumed correct and made in good faith, with the taxpayer having t.he burden of proving otherwise. Failure t.o present proof of error in the assessment will justify the judicial affirmance of said assessment. _71 Therefore , respondent's disallowance of the amount of P1,156,701.76 as deduction from petitioner's taxable gross 1ncomc for taxable year 2007 is upheld. Accordingly, petitioner's repairs and maintenance amounting io P1, 156,701.76 shall be subject. t.o income t.ax: Disallowed Repairs and Ma intenan ce F:x pcnsc Per P1 ,3 88 , l_lL_OO Assessment 23 1,4 09.24 - -- p 1, 156,701.76 Le ss: Duly Substa nti ated Re pa irs a nd Mai n te n a n ce found t o b e no t subj ect to 2% ~WT(I\n.n.ex 1\, 1) Should-be Disallowed Repairs and Maintenance A.2 Disallowed Expenses (50�/o rule) - P 12,525,469.00 In disallowing the amount. of P12 ,52 5 ,469.00 , representing 50�/o of petitioner's claimed deductions for variou s expenses, respondent siat.ed tn the Detail of Discrcpancics72 attached to the Formal Assessment Notice sent io petitioner ihat_73 : "xxx - In view of your con linu cd a nd unjustifia ble r efu sal to prove with doc umentary evid e nce th e correctness of your tax return for the calenda r year ending December 3 1, 2 007 , this Office h a s b een constrained to resort to the Res t F:vid cncc Rul e in d ete rminin g y our in come tax li a bili ty pursua n t to Reve nue Me mora ndum Circ ula r No. 23-2000 . Apply in g the 50% rule of a pproxima lion as enu ncia ted ls ic l the Court in th e cas e of Ma ri a no Za m ora, t h e fo ll owin g ex pe n ses we re disa llowed as d eduction s from your in com e, to wit: Cost of sales: C la i m e d 50% Deductions D i s all o w a n c e Inventory- beginning P l8,506 ,363 .0 0 _Direc t farm in pu ts "flMa r cos II vs . Co urt of Appeals. et a t .GR. No . 120880, June 5, 1997. �r2 "Exhibit "BB --1 ". �r:~ "Exhibit "BB".

DECISION Page 27 of II 0 CTl\ Case No. 8375 Village-Green Hog Farm, Inc. vs CIR Tota l 27,404,323.00 - - !15,910,686.00 Less: Inventory-end 2!1 ,053,669 .00 f>21,857,017.00 -- 1,887,568.00 _Salaries and wages 571,568.00 -- 267,144.00 !~ower j gasoline 137,697 .00 Taxes and licenses 211,945.00 l.(cprcscntation 117,999.00 Office supplies I miscellaneous Insurance; fees and other charges Total 25,050,938.00 12 ,525, 469 .00 _!1isallowed expenses _Pl2,525,~69 . 00" . This, however, was refuted by petltloner through a leUer74 dated May 31, 201 0, setting forth the fo ll owing de fe n ses against the deficiency tax assessment: "Salaries and Wages.Sal a ri es and wages, including 13th month pay, SSS, Pag- Ibi g an d Philh ealth pre miums, are paid lo our 13 farm hands and farm manager. Our employees lake care of lhc breeding, assisl sows during lhc birthing, fe edin g, vaccinating and m edicatin g. They ckan th e pe ns and buildings using pressure washers a nd disinfcclanls. We also have lhrcc (3) of our employees opcralc our own feed mill to grind ingredie nts such as ye llow corn and mix according lo required formula tions. For maintenance, we have lwo (2 ) full lime employees. Power/Gasoline .~lectri c ity is used for the two submersible pumps lhal supply walcr for lhc pigs and for cleaning of lhc pig pens. We also operate two booster pumps, three high pressure washers a.nd two power s praye rs . We use brood e rs lights for our newly born pigs up lo nursery. We opcralc our own feed mill with a h am m e r mill a nd a mixe r. For our mainte n a nce a nd re pair, we have three welding machin es, cul-off saws, bench drills and portable cquipmcnls such as drills and angle grinders. For manure lrcalmcnl, we operate sludge pumps and m a nure separators. For gasoline and diesel, we have lwo diesel-powered generators which we operate during power brownouts. Our farm vehicle is an lsuzu ~If which we used to purchase feed, ingredients and supplies. Repairs and Maintenance . We h ave the following buildings for our operation: � 13reedin g 13uildings 3 8.0mxl5.0m 74 Exhibit "AA'', pp. 1-3.

DECISION Page 28 of IJ 0 CT/\ Case No. 8375 Village-Green Hog Farm, Inc. vs CIR � Gestating Buildings 4 8.0mx22.0m � Farrowing 1.3uildings 8 8.0mx11.5m � Gilt Building 1 8.0mx8.0m � Weaning/ Nursery 1.3ldgs. 7 8.0mxl5.0m � Growing Buidlings 3 8.0mx30.0m � Finishing 1.3uildings 4 8.0mx30.0m � Feed Mill &, Warehouse 1 16.0mx18.0m � Maintenance 1.3uilding 8.0mxl6.0m � Farm Office&, Storeroom 1 5.0mx15.0m To maintain these buildings, we undertake repairs on daily basis. We also do periodic repairs on the roof, curtains, on the elevated plastic/ cast iron floorings, on the concrete floorings and walls which are damaged by pig manure and unnc. Depreciation.The depreciation refers to the annual depreciation of the a bovc listed buildings and also for the previously mentioned pumps, cquipmcnts and feed mill machineries. The depreciable assets are a ll used m production. Taxes and Licenses.The taxes and licenses are for the Mayor's Permit and other City fees and charges. Fees arc also paid to the Barangay office for Barangay Clearance. Real ~state taxes paid are for the farm lot and for the buildings. Representation and Donation.Thcsc expenses arc incurred in the normal pig production operations. The farm is located within the 1.3arangay of 1.3alintawak III, Lipa City. Part of the responsibility of the farm is to participate in community affairs such as sponsoring the celebration of masses and miscellaneous affairs particularly during barrio fiesta. Office Supplies and Miscellaneous.Officc supplies include the pre-printed production report forms submitted by the farmhands on a daily, weekly and monthly basis. Production reports include breeding and gestating, farrowing, weaning and nursery, etc. Reports on feed consumption, medicine and vaccines, mortalities, maintenance, farm gate weights, etc. /r- 1\ccounting forms such as Cash Vouchers, Check Vouchers, Payable Vouchers, etc. BIR mandated forms such as Invoices

DECISION Page 29 of IJ 0 CTA Case No. 8375 Village-Green Hog Farm, Inc. us CIR and Official Receipts, Miscellaneous office supplies such as ball pens, chalks, paper clips, staplers. Insurance/Fees and Other Charges.lnsurancc/ fees and other charges include fees and insurance of motor vehicles, fire insurance, veterinary consultants' fees, audit fees, hog raisers' association fees and dues. Farming including hog breeding and rmsmg are fundamentally and purely production operations. This is particularly true in our instance since we do not engage in marketing. We sell our produce as live animals. Our buyers use their own trucks to pick-up the market hogs in our farm. All of our employers arc involved in production." To ascertain that the disallowed cost of sales/ expenses are valid business expenses of petitioner and should not be disallowed by the respondent, the ICPA performed the fo ll owing procedures, viz75: "(a) xxx obtained, traced and checked the petitioner's original Check Vouchers including its supporting documents such as Supplier's Invoices, Supplier's Official Receipts and liquidation; (2) xxx summarized the petitioner's allowable expenses based on submitted original Check Vouchers with supporting documents; (3) xxx traced the Check Vouchers with the petitioner's 2007 J\udited Financial Statements." Having performed all the procedures abovementioned, the ICPA came up with the following conclusions76: "1. xxx, we have verified that P26,439,049.00 Cost of Sales (repairs and maintenance P1,388,111.00 plus total cost of sales P25,050,938.00) was properly substantiated. Check vouchers supports the disbursements; and the disbursements were evidenced by supplier's invoices and related receipts. 2. We have determined that petitioner's Cost of Sales is an allowable expense and a valid deduction from petitioner's Taxable Income." The Court finds the TCPA findings not in order. ?- Upon careful examination of petitioner's supporting documents, the Court noted the following: 75 Exhibit "MM", Docket Vol. I, p. IJ l!J; Exhibit "NN", p. 387. 76 Exhibit "NN", Docke t Vol. I, p . 389 .

DECISION Page 30 of 1J 0 CTJ\ Case No . 83 75 Village-Green Hog Farm, Inc. us CIR 1. Cost of Sales Petitioner's cost of sales in the amount of P21 ,857 ,017.00 was computed as follows77 : Inven tory, beginni ng p 18,506,363.00 1\dd: Direct Fa rm Inputs To t al 27,40 4,323 .00 Less : In ve n tory , e nd p 45,9 10,686.00 Cost of Sales 24,053,669 .00 r 21,857,0 17 .00 The beginning and ending inventories in the respective amounts of P18 ,506 ,363.00 and P24, 053 ,669.00 tally with the figures reO ected in petition e r 's Audited Incom e State ments78 for the years ended December 3 1, 2007 and December 31 , 2 006. However, a s r egards p e tition er's Direct Farm Inputs tn the amount of P2 7 ,404,323 .00, only the amount of P8 ,083 ,9 7 1.81 79was duly accounte d for. Using the amount of P8 ,083,97 1.81 for Direct Farm Inputs , petitioner's substantia te d cost of s ales amounted only to P2 ,536 ,665 .81 , as shown below: - p 18,50 6,363. 00 Inventory, beginning 8, 0 83, 971.81 p 26,590 ,334.81 Add : Direct Farm Inputs Total 24,0 53,669.00 Less: Inven tory, end p 2,536,665.81 Substantiate d Cost of Sales 2. Salaries and Wages Petitioner's claimed Sa la rie s and Wages in the amount of P 1,887 ,568 .00 consisted of the followingso: Salaries ~lx, Wages p I,586,63 1.84 13th Mon th J>ay 138,2 0 5. 00 F:mployccs Welfare 42 ,2 11.91 SSS Con tr ibuti on 86,365.40 Philhealth Cont ribution 15,750.00 Pag-Ibig Fu nd Contribution 18,40 4. 00 Total p 1,887,568. 15 77 Exhibit "BB 4 ". 't8 J<:xhibit " 10", mR Records , p. 16. 79See details pe r Annex A of this Decision. somR Records, pp . 6IJ -6 6.

DECISION Page 3 1 of 10 CTJ\ Case No. 8375 Village-Green Hog Farm, Inc. us CIR With respect to the claimed Employees Welfare of P42,211.91, SSS Contribution of P86,365.40, Philhcalth Contribution or P15 ,750.00 and Pag-Ibig Fund Contribution or Pl8,404.00, the Court cannot verify the actual remittance thereof because petitioner merely presented its check vou ch ers81 without the related payment receipts issued by the SSS, Philhcalth and Pag-lbig. Regarding the Salaries & Wages in the amount of Pl,586,631.84 and 13th Month Pay in the amount of Pl38,205.00 totalling '?1,724,839.84, petitioner submitted check vouchcrs82 , payslipsjpayroll computation83, Annual In formation Return or Income Taxes Withheld on Compensation and Final Withholding Taxes (BIR Form No. 1604-CF) and Monthly Remittance Returns of Income Taxes Withheld on Compensation (BIR Forms No. 1601-C) with attached UCPB BTR-BIR Deposit Slips for taxable year 200784 � As indicated in the aforesaid BIR Forms Nos. 1604-CF and 1601 -C, petitioner paid a total amount of'P1 ,623,960.00 taxable compensation income on which it withheld and remitted to the BTR a total amount or P145, 728.00 creditable withholding taxes for taxable year 2 007. However, absent or the petitioner's alphalist of employees for taxable year 2007 , the Court cannot determine the accuracy or the amount or P 145,728.00 taxes withheld on it.s employees' compensation income ofP1 ,623 ,960.00. It bears stressing that an expense, to be validly deducted from the taxpayer's gross income, must not only be substantiated by sufficient evidence such as official receipts or a d equ ate records in accordance with Section 34(A)(1 )(b) or the NIRC of 1997, as amended, but also it must be shown that the tax required to be deducted or withheld therefrom has been paid to the BIR pursuant to Section 34(K) of the same Code. 3. Power/Gasoline, Taxes and Lic e nses, Representation, Office Supplies/Miscellaneous , Insurance/Fees and Other Charges ~ 81 Exhibits ''VVVVVVVVVV"VVVV.'' to "SSSSSSSSSSSSSSSSSSS" "XXXXXXXXXXXXXXXXXXXX:XXXX" to "W"VVV "SSSSSSSSSSSSSSSSSSS" 82 Exhibits "VVVVVVVVVVVVVVV" to "SSSSSSSSSSSSSSSSSSS-11 "; - 3 ". " 83 Exhibits "XXXXXXXXXXXXXXX-1" to -1" to " 84 Exhibit "TTTT'I'T'TTT'I''ITI''I'TT".

DECISION Page 3 2 of IJ 0 CT/\ Case No . 83 75 Village-Green Hog Famt, Inc. us CIR A scrutiny of the documents supporting each of these accounts reveals thai only the foiiowing amounts are properly substantiated: Properly Expense Account Substantiated- Power j Gaso lin e (1\n~ex 1\) 2) Taxes and Licenses (1\nnex 1\) 3) ~ Reprcscnlalion(Annex A1 4) _Qf.�~c supp,!icsj miscellaneous: (Annex A 1 5) p 358,645.40 Insurance/ fees and other charges: (1\nnex 11) 6) 10.00 3,500 .00 19,465. ~ 5 5,2 5 0.QQ_ In fin e, petitioner was able to substantiate its claimed deductions only to the extent of P2,973,536.48 out of the total amount of P25,050,938.00, detailed as follows: - Claimed - - Deduction Cost of sales : Substantiated % of Inventory Beginning Deduction Substantiated Direct Fa rm Inputs Total to Claimed Less: Inventory End Deduction Sa la ries and Wages p 18,506,363.00 P2 1,857 ,017 .00 f- 2,5 36,665. 81 12% Power I Gasoline 27 ,1]01] ,323. 00 1,887, 568.00 0% 45,9 10,686.00 57 1,568.00 3 58 ,64 5 .40 63% Taxes and License s 2 4,0 53,669 .00 267, 11JIJ .OO 10.00 0% Representa tion Office Supplies 137,6 97 .00 3,500.00 3% /Miscellaneous 2 11 ,94 5. 00 19,465.27 Insurance/ Fees and Other 9% Charge s 11 7,999.00 55 ,2 50.00 Total IJ7 % P25, 0 5 0 ,9 3 8.00 P2 ,973, 536 .1J8 12% Considering thai petitioner's claimed deductions were not adequately supported by documentary evidence as above- indicated, the Court deems it appropriate to uphold respondent's disallowances save for the Power/ Gasoline account, applying the 50�/o rule of approximation provided under Section 2.4 (c) of Revenue Memorandum Circular (RMC) 23-00, which cited the case of Mariano Zamora vs. Collector of y Inte rnal Revenuess . Quoted hereinbelow is the pertinent pari of RMC 23-00: 85 En bane , M/\W/\NO Z/\MOR/\, pe tition er , vs . COLLECTOl~ OF INTERNAL l~EVENUJ:<: and COUla OF T/\X 1\PPE/\LS, respond ents . (G .l<. No. L 15 290 , May 31 , 1963 .) COLLECTOR OF INTE l-?N/\L Rl<:VENUE, petitioner, vs. M/\RI/\NO Z/\MOR/\, r espondent. (G.R. No . L- 152 80 , May 3 1, 1963. ); ESPERANZA A. ZAMORA , a s specia l Administra trix of the Esta te of FELICIDAD ZAMORA, petitioner, vs. COLLECTOR OF INTERNAL REVENUE a nd COURT OF TAX APPEALS , re spondents . (G .R. No . L-15 2 89 ,

DECISION Page 33 of IJ 0 CTJ\ Case No. 8375 Village-Green Hog Farm, Inc. us CIR (c) Assessment L?ased on Estimate; 50% A?ule, in the Absence of Receipts to Prove Actual Amount of Rxpense Deduction. - The Court held in the Mariano Zamora case that, if there is a showing that expenses have been incurred but the exact amount thereof cannot be ascertained due to absence of documentary evidence, it is the duty of the L31 R to make an estimate of the deduction that may be allowable in computing the taxpayer's taxable income, bearing heavily against the taxpayer whose inexactitude is of his own making. That disallowance of 50% of the taxpayer's claimed deduction is valid. XXX XXX XXX "Section 30 of the Tax Code provides that m computing net income, there shall be allowed as deductions all the ordinary and necessary expenses paid or incurred during the taxable year, in carrying on any trade or business (Vol. 4, Mertens, Law of Federal Income Taxation, sec. 25.03, p.307). Since promotion expenses constitute one of the deductions in conducting a business, same must satisfy these requirements. Claims for the deduction of promotion expenses or entertainment expenses must also be substantiated or supported by record showing in detail the amount and nature of the expense incurred (N.H. Van Sicklcn, Jr. vs. Comm. of Int. Rev., 33 RTA 544). Considering, as heretofore stated, that the application of Mrs. Zamora for dollar allocation shows that she went abroad on a combined medical and business trip, not all of her expenses came under the category of ordinary and necessary expenses; part thereof constituted her personal expenses. There having been no means by which to ascertain which expense was incurred by her in connection with the business of Mariano Zamora and which was incurred for her personal benefit, the Collector and the CTA in their decisions, considered 50% of the said amount of P20,957.00 as business expense and the other 50%, as her personal expense. We hold that said allocation is very fair to Mariano Zamora, there having been no receipt whatsoever, submitted to explain the alleged business expenses, or proof of the connection which said expenses had to the business or the reasonableness of the said amount of 1'20,957.00. While in situations like the present, absolute certainty j- is usually not possible, the CTA should make as close an approximate as it can, bearing heavily, if it chooses, May 21, 1963.); COLLECTOR OF INTERNAL REVENUE, petitioner, vs. ESPERANZA A. ZAMORA, as Special Administratrix, etc., respondent, (G.R. No. L-15281, May 31, 1963) .

DECISION Page 31J of 1J 0 CTJ\ Case No. 8375 Village-Green Hog Farm, Inc. us CIR u pon lhc laxp aycr whose incxac lncss 1s of h is own m a kin g." Accordingly, petitione r 's claimed deductions from its taxable gross incom e for the year 2 007 in the amount of P12,452,607.60 shall be disa llowed , broken down as follows: Claimed -- Dedu ction 50% Disallowance Cost of sales: f> 21,857,017.00 f> 10,928,508.50 1,887,568.00 943,784 .00 lnven tory- beginning 571,568.00 267, liJIJ .00 212,922.6086 Direct farm inputs 137,697.00 133,572.00 211,91J5.00 68,848.50 Total 117,999.00 105,972.50 Less: Inventory-end 1"25,0 5 0 ,938 .00 58,999.50 Salaries and wages ! 12, 45 2 ~!> 7.:60 Power I gasoline Taxes and licenses l<.epresenta tion Office supplies I miscellaneous Insurance; fees and other charges Total A.3 Unaccounted Source of Cash - P86,372.19 Respondent imputed against p etitioner an undeclared income in the amount of P86 ,372 .1 9 based on the following finding: 87 "Unaccou n lcd source of cash (P86,372.19) - Vcr ifica lion disclosed lhal your income paymcnls subjccl lo exp anded w it hh o ld in g tax we re not reported in th e fina n cial state m e n ts, as pe r analys is h e reun d er, w h ere in th e total d ifference was considered as unaccoun lcd sou rce of cash w hi c h led to th e in fe rence th at part of your in come h ave not been dec la red as e nunciated by the Court in th e case of Perez v . CTA & CIR L -1 0 507 da lcd May 3 0 , 1958. Therefore, lhc amou n l is a dded in your rcporlcd laxab le income purs u ant to Sectio n 31 of the Tax Code of 1997, as amend ed." Per Per Di ffe re n ce I Financial rclurns j Slalcmcnls ?- p 58,47? .1_9 _~ecuri ty se rvices alpha lisl P58,472.19 86 Claimed Deduction P571,568.00 Less: Amount Duly Substantiated 358,61J5.1JO Disallowance P212,922.60 87 Par. c, Exhi bit "f3f3-IJ ".

DECISION Page 35 of 10 CTA Case No. 8375 Village-Green Hog Farm, Inc. us CIR Other services 7,500.00 - 7,500.00 20,400.00 - P r o f e s s i-o n a l fees - - 2 0 ,400 .00 - Unaccounted source of :P86,372.19" cash In its letter dated June 4, 2010, petitioner controverted the alleged unsupported source of cash, particularlyss: "PROTEST NO. 2 - Unaccounted Source of Cash: Security Services of P58,472.19 were subject lo 2% expanded withholding lax. This 1s under the Accoun t Tille INSURANCF: / FF:F:S AND OTIIF:R CIIARGF:S in our Income Slalcmcnl. Other Services o f :P7 ,500 .00 arc those paid lo liason person tha t we paid only when there arc documentations needed lo be done outside and not on a regular basis. This is not subject to 10% ~xpand e d Wi thholdin g Tax. This is a lso under the J\ccoun t Title INSURANCF: / FF:F:S AND OTIIF:R CIIARGF:S in our Income Statement. Profession a l Fees of P20,400.00 were subject to 10% ~xpand e d Withholdin g Tax. This is included under the J\ccoun t Titl e OFFIC~/SUPPU~S/MISC~LLJ\N~OUS m our Income Statement. These arc all accounted for m our Financial Statements." The petitioner's protest above quoted is in accord with the Judicial Affidavit89 of Mr. Arden Retales , TCPA. The pertinent portion of the latter's testimony 1s set forth hereunder: "25.Q: xxx What is your basis for saymg that the alleged unaccounted source of cash amounting lo Php86,372. 19 are valid business expenses a nd reclassified m the 2007 J\udited Financial Statements'? !\: l3ased on the procedures I performed, I ascertained tha t the a lleged unaccounted source of cash amou ntin g to Php86,372. 19 consists of valid business expenses that are properly substantiated. This alleged unaccounted source of cash amounting to Php86,372.1 9 arc duly supported by Suppliers' Invoices an d Suppliers' Official Receipts. Further, I have checked that this alleged unaccounted source of cash arc m fact expenses by the petitioner reclassified m the � 2007 J\udited Fina ncia l Statements under Insurance Fe e s and Other Charge s for Security Services and Other Services v a nd Office Supplies /Mis c e llaneous for Professional Fees. XXX 88 Exhibit "CC". 89 Exhibit "MM", Docket Vol. II, p. 115.

DECISION Page 36 of IJ 0 CT/\ Case No . 8375 Village-Green Hog Farm, Inc. us CIR 26.Q: Why do you say that. the alleged unaccounted source of cash amounting to J>hp86,372.19 are valid business expenses? A: The unaccounted source of cash amounting to Php86,372.19 was traced to Check Vouchers with valid supporting documents as follows: (a) Security Services of r>hp58,4 72. 19 which was subject. lo 2% expanded withholding lax and is accounted for as part. of account. Litle insurance F'ees and Other Charges of the 2007 1\udited Financial Statements; (b) Other Services of J>hp7,500.00 is accounted for as part of account title Insurance f1'ees and Other Charges of the 2007 Audited Financial St.alernent.s; (c) Professional Fees of Php20,400.00 was subject to I0% expanded withholding tax and is accounted for as part of account title Office Supplies/ Miscellaneous of t.he 2007 Audit.ed Financial St.at.ernent.s." The Court finds respondent's assessment devoid of merit. Since the expenses reflected per petitioner's alphalist were higher than the amounts reported in its financial statements, respondent concluded that the difference pertains to petitioner's undeclared income. By doing so, respondent merely relied on assumptions without obtaining any evidence corroborating such findings. This is contrary to the doctrine laid down by the Supreme Court in Collector of Internal Revenue vs . Be nipa yo9�, wherein it was held that: "xxx An assessment. fixes and determines t.he lax liability of a taxpayer. As soon as it. is served, an obligation arises on the part of the taxpayer concerned to pay the amount. assessed and demanded. IIcnce, assessments should not. be based on mere presumptions no rna t.t.er how reasonable or logical said presumptions may be xxx. In order to stand the test of judicial scrutiny, the assessment. must. be based on act.ual fact.s. The presumption of correctness of assessment being a mere presumption cannot be made to rest on another presumption xxx" Even if these alleged unaccounted income payments are to be treated as income, the same shall be offset by reporting the equivalent payments as expenses. Hence, no taxable/-- 9o G.R. No. L-13656, January 31, 1962.

DECISION Page 37 of IJO CT/\ Case No. 8375 Village-Green Hog Farm, Inc. us CIR Income will result from the said transactions, as illustrated below: -~ - - -~- Undeclared income from unaccounted income payments: Security services p 58,472. 19 Other services 7,500.00 Professiona l fees 2 0 ,400.00 p 86,372.19 Less: Undeclared expe nses Security services p 58,472.19 Other services 7,500.00 Profession a l fees 20,400.00 86,372.19 Taxable Income p - For lack of factual basis, the deficiency income tax assessment pertaining to the alleged undeclared income from unaccounted Income payments of P86,372.19 IS hereby cancelled. In sum, petitioner is liable for basic deficiency income tax for taxable year 2007 in the amount of P4,763,258.28, computed as follows: Taxable Income per ITR p 120,375.00 Add: Adjustments per investigation p 1'156,70 1. 76 Income paymenls not subjected 12,452,60 7.60 13,609,309.36 to withholding tax P13,729,684.36 Disallowed expenses Taxable Income per investigatio n Income tax due thereon p 4,805,389.53 Less: Payments 42,131.25 Deficiency Income Tax ~~~, I63 , 2ss . 2s B. DEFICIENCY EXPANDED WITHHOLDING TAX P41,270.63 Based on the finding that petitioner failed to withhold and remit 2�/o EWT on its income payments for repairs and maintenance in the amount of Pl ,388,111.00 pursuant to RR No. 02 -98, as amended , as discussed under the dericiency income tax assessment (sec discussion in item A.l above), respondent. assessed petitioner of deficiency 2�/o EWT in the amount ofP41 ,270.6391, computed as follows:~ 91 Exhibit "Bf3" , p. 2.

DECISION Page 38 of tJ 0 CT/\ Case No . 8375 Village-Green Hog Farm, Inc. us CIR Amount EWT EWT Due Rate - -- 2% -- -- - Repairs and Mainte n a nce p 1,388,111.00 P27,762 .22 Deficiency Expanded Withholding Tax f27 ,762.22 Add: 20% interest p.a. (01.1 6. 08 to 13,508.41 06.21.1 0) - TOTA-L-AMOUNT DUE P41 ,270.=6 3 As discussed earlier, petitioner failed to show that its claimed repairs and maintenance expense in the amount of P1, 156,701.76 is not subject. to 2�/o EWT or t.hat the prescribed EWT thereon has been duly withheld and remitted to the B TR pursuant to RR No. 02-98 , as amended, hence, petitioner shall be held liable to pay basic deficiency EWT in the amount of P23, 134.04, computed as follows: Re pairs a nd Ma intenance ~xpe n se Pl, 156,70 1_.76 ~WT Rate 2% Basic Deficiency Expa nde d Withholding Tax p 23, 134.04 WHEREFORE, in view of the foregoing, the assessments issu ed by respondent against petitioner covering deficiency income tax and EWT for taxable year 2007 is hereby AFFIRMED with some modifications. Accordingly, petitioner ORDERED TO PAY respondent the amount of P5,982,990.40 representing deficiency income tax and EWT for taxable year 2007, inclusive of the 25�/o surcharge imposed under Section 248 (3) of the NTRC of 1997, computed as follows: Basic Tax 25% Surcharge Total Deficiency Income p 4,763,258 .28 p 1'190,814.57 p 5,954,072.85 Tax 23, 134.04 5, 783.51 28,917.55 Deficiency ~WT Total P4 ,786,392.32 .P 1' 196,598.08 .P5 ,982,990.40 In addition , petitioner ts ORDERED TO PAY the f<l ll<lwing: a) Deficiency interest at the rate of 20�/o per annum on the basic deficiency income tax of P4,763,258.28 computed from April 15, 2008 and on the basic deficiency EWT of P23,134.04 computed from January 15, 2008 until full payment thereof pursuant to Section 249(B) of the NIRC of 1997, as amended; b) De linquency interest at t.he rate of 20�/o per annum on the total arnount of P5 ,982 ,990.40 and on the 20�/o/-

DECISION Page 39 of 10 CTJ\ Case No . 8 375 Village-Green Hog Farm, Inc. us CIR deficiency interest which have accrued as aforcstatcd in (a) , computed from Jun e 2 1, 2 01 0 until full payment thereof pursuant to Section 249 (C) of the NTRC of 1997 , as am e nd ed. SO ORDERED. ~~- c: ~__./~ AMELIA R . COTANGCO-MANALASTAS Associate ,J u sticc WE CONCUR: # ~cd-~a4/~ � CAESAR A. CASANOVA Associate J u sticc J6AN�To C. CASTANEDif,'J R . Associate ,J u sticc

DECISION Page -'1 0 of-'1 0 CT/\ Case No. 8375 Village-Green Hog Famt, Inc. us CIR 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. ~~ C. a;T~o(p,~ ~. JtrANITO c. CASTANEDA:, JR. Associate Justice Chairperson CERTIFICATION Pursuant to Section 13, Article VITI of the Constitution and the Division Chairperson's Attestation, it is hereby certified that the conclusions in t.he above Decision were reached in consultation before the case was assigned to the writer of t.he opinion of the Court..

CTA Case No. 8375 ANN EX A Village Green Hog Farm, Inc. vs. CIR Dul Substa ntiated Ex enses 1. Repairs and Maintenance ~ --- -- O. R. I Exhibit Date Invoice Payee Particulars Amount No. -- 13-Jan- ISUtU- INTECO vehicle repair A 031698; "MMMMMMMMMMMMMMMMMM-/" 01 688.80 "MMMMMMMMMMMMMMMMMM-1" 0381~ " WWWWWWWWWWWWWWWWWW 2" 22 Jan Jeida Farm Supply Corp materials for "WWWWWWWWWWWWWWWWWW 1" 07 10026; SH1S1 warehouse I /-Jan- 07 1~/48 repair 1 100.00 "AAAAAAAAAAA oAAAAAAAAAAAAAA-9" 31 Jan 190111 Junction Jr. Corp. carwash - 01 1318 310.00 "HHHHHHHHHHHHHHHHHHHHHHHHHH1" 8-Feb-0/ Lito's Builder & Construction purchase of Supply tubular 904 .00 " NNNNNNNNNNNNNNNNNN-1" Emil Aula Parts & Electrical water pump Supply cleaninq, capacitor check-up 1 /00 .00 "RRRRRRRRRRRRRRRRRRRR 1" 27 Feb 21H6 Datacon Mana;wment Service subscription 07 1303 " HHHHHHHHHHHHHHHHHHHHHHHHHH~ " Center, Inc. - dues - I-- _ _2,7SO .OO_ 8-Mar-0/ I units " UUUUUUUUUUUUUUUUUU 2" Jacala Metal Works Corporation "UUUUUUUUUUUUUUUUUU-1" concrete " HHHHHHHHHHHHHHHHHHHHHHHHHH~ " - bumJY r-- 7,600.00_ "JJJJJJJJJJJJJJJJJJJJJJJJ.-J:cJc-1--:,c, -- 19 Mar 'i112; Indola Inti Phils., Inc. S units heavy 1/883 "JJJJJJJJJJJJJJJJJJJJJJJJJJ 1" 01 11 ~/8 industrial fans ~~ 000.00 "CCCCCCCCCCCCCCCCCCC- I " "CCCCCCCCCCCCCCCCCCC-1" /0-Apr- 37'i77 Fortune Kings Hardware & 1 roll barbed "JJJJJJJJJJJJJJJJJJJJJJJJJJ ~� 07 Const. Supply Corr>.:_ -- - wire - f - 97S.OO "DDDDDDDDDDDDDDDDDDD-4" - YS Hardware 1 qallon paint "DDDDDDDDDDDDDDDDDDD 2" " DDDDDDDDDDDDDDDDDDD 1" 3 May 07 thinner 19~ . 00 1 May 07 066 R&B Tradinq electrolytes 1SO.OO /-May-0/ 11/3; Pump up Trading materials for 11/4 water system repair 6,739.00 H May 07 2291 Nina Vi rqinia Hardware and 1- Construction ConsL Supply material 41 . ~0 I ~-May- ~96/6; Clindisco Phil. Inc. repair of 07 7360H; water pump, 73609 purchase of lhru boll,gaskel, ball bearinq - - 2,262.1(1._ Sta rite " FFFFFFFFFFFFFFFFFFF 1" 1 Jun 07 736S1 Clindisco Phil. Inc. shallow well jel pump - - 16 ,~40.QQ__ " MMMMMMMMMMMMMMMMMMMMMMMMMM 3" 21 Jun 'i3391 Hon<J Shun Hardware & deformed bar 07 4/0 Construction Supply 7130.00 11-Jun- S1976 " JJJJJJJJJJJJJJJJJJJJJ - / " 4003 J.C Arivara Aula Electrical rewind of 01 1790 "MMMMMMMMMMMMMMMMMMMMMSMMMMM Services - 1--_�ou lds puf1]J_ 1--- 1,600 .QQ__ 26 Jun Hcm;J Shun Hardware & wound bar, 3" 01 Construction Supply deformed bar 4 4/0.00 "MMMMMMMMMMMMMMMMMMMMMMMMMM~" 19-Jun- *** deformed bar 07 1- - - 6,1SO.OO Jul 07 Nina Virqinia Hardware and Construction ConsL Supply material 18~.00 3-Jul - 0 / 6//01 Tri-Mark Construction Supply Vulca Seal --- 9-H.O-O 3-Ju l- 0 / Vul ca Seal - 98 .0-0 1 Jul 07 6/100 - black sand 12HH Tri-Mark Construction Supply Prime House Hardware & Const. Supply H 'iOO.OO 4-Jul-0 I 41~8 *** deformed bar 3,160.0Q_ S Jul 07 IrH)asco, Inc. ~RRRRRRRRRRRRRRRRRRRR :f 6-Jul-0/ 111673 A; - - r-- 26H03H "RRRRRRRRRRRRRRRRRRRRR 1" 4480 LPG " 00000000000000000000000000-~ " 1 HOO.OO "00000000000000000000000000 3" *** Fortune r..pppppppppppppppppppppppppp 3" cement 7,00S.OO 9 Jul 07 1'i117 Prime House Hardware & Const. Fortune Supply cemen t 4 3~0.00 9-Jul-0/ 1~086 Prime House Hardware & ConsL deformed bar Supply H,1HO.OO 21 Jul 07 7SH7 Emil Auto Parts and Electrical repair of Supply submersible :u Jul 07 131613 Our Penta;Jon Allied Commercial - pump 3,~00 . 00 various { 3//4.00 1 of 10

ITA Case No. 8375 ANNEX A Village Green Hog Farm, Inc. vs. CIR - -~ - . - ,-- - Corporati on construction ma terials " LLLLLLLLLLLLLLLLLLLLL 3" :{ Auq 07 A ()]7917; I ndustrial & Transport Vehicle repair 3 696 . ~ 1 " LLLLLLLLLLLLLLLLLLLLL 1" 4-Aug-0 / 06826; Equipment Inc. " LLLLLLLLLLLLLLLLLLLLL-/ " 0/384 / " PPPPPPPPPPPPPPPPPPPPPPPPPP-3" 13/4 1/ Our Pentagon Allied Commercial variou s Corporation co ns t ruc tion materials 1113.75 " PPPPPPPPPPPPPPPPPPPPPPPPPP-3 " 10-Aug- 1/31 FJ H Hardware & Electrica l Co nstru c t ion 9~ 0 . 0_Q__ Supplies material - ~~ 01 76 11 Emil Auto Parts & Electri c Auto parts, " NNNNNNNNNNNNNNNNNNNNN 1" 11 A u~J Supply ( Emi li ano An~J) electrica l 07 supply 3 ~ 00 . 00 " 000000000000000000000-1" 3-Sep-0 / 604/ JB Hi Tech, Inc. Repair-power -�----- -- - - washer - _ J!_,550 .(!.Q__ I 0-Sep- 001 0 Data Serve Management lnl'l subscri pti on ") 1~ 0 . 00 01 180629; Corporation d ues 216177 15 Sep Timoq Tireha us Vehi cle 07 ~ ~ ~~9 m a i n tenan ce 50 .00 18-Sep- 1697 Li bman Electrica l Servi ces Electrica l 01 1 /19 -~-~- Four L's Corporation - services - - - 3,8 / 0.0Q__ 21 Sep 1301 ca r battery " SSSSSSSSSSSSSSSSSSSSS 1" 07 / 6-Sep- 51 00.00 01 Otone Lin e Hardware & Con stru c ti o n -- 2 Oct 07 Con struction Supply - - materials ~ - / 6 4 .00 " UUUUUUUUUUUUUUUUUUUUUUUUUU 1" Ozone Line Hardware & Co nstru ction Construction Supply ma t er ia ls 116. 00 3-0 cl -0/ /6683 Carman Electrical Shop Electrical - -- ~ suppli es 613. 0-0 5 Oct 07 01 87 D.A.R. Mufflers ~ Vehicl e maintenance 3~ 0 . 00 " I I I I I I I I I I I I I I I I I I I I 1-/" 6-0 cl-0 / 146 /; On e unit " I I I I I I II I II I I I I I I I I I I 1" 1557 Jaca la Metal Works Corporation concre t e b u~JCJY 3 700.00 6-0 cl-0 / /044~6 Lito's Build er & Construction deformed bar -- Supply - 1 ,9 ~ 6. 00_ Lito's Builder & Construction ~ Sand 6 Oct 07 201159 Supply 7 300 .00 19-0 cl - 1146 Masagana Auto Supply Vehicle repair 07 7(199 - --- -- -- 785 .00 22 Oct 1103 " UUUUUUUUUUUUUUUUUUUUUUUUUU 1" Emil Auto Parts and El ectrical Sub me rsib le 01 71602 01 98 Supp ly pump 3 600 .00 /~- Oc t- 1 131 4 " UUUUUUUUUUUUUUUUUUUUUUUUUU~ " Emil Auto Parts and El ectrical Submersible 07 - - 27 Oct Supply _ _pump - - 1,700. 00_ Tri Mark Construction Supply Const r uction ~~ 01 " UUUUUUUUUUUUUUUUUUUUUUUUUU 1" 6 Nov 07 6-Nov- 0 / mater ia l 36 .00 " UUUUUUUUUUUUUUUUUUUUUUUUUU1 " D.A.R. Muffl ers Car repair 350 .00 " UUUUUUUUUUUUUUUUUUUUUUUUUU~ " Galaxy Steel Consl. Suppl y Constructi on - ~ materia l 100.00 Vehi cle -~ 13 Nov 181288 Timoq Tirehaus 07 1963 maintenance 1 5 .00 14 - Nov- " WWWWWWWWWWWWWWWWWWWWWWW - Oton e Line Hardware & Constructi on WWW - 3 " 01 A 012 180; Construction Supply - materials - - - - / 16.QQ__ --~ 11 Nov 026768; 07 0/6 / 69 ; I NTECO Vehicle repa ir ''VVVVVVVVVVVVVVV IJ'' 113 1I ''VVVVVVVVVVVVVVV 1'' 15 Nov 25718 Lito's Bui lder & Construction 1/, 0 /1 .~8- " VVVVVVVVVVVVVVVVVVVVV-/ " Supply �" V-VVVVVVVVVVV-VVVVVVVV-V-3" 01 / 10/ Otone Line Hardware & ~-- ''WWWWWWWWWWWWWWWWWWWWWWW Construction Supply WWW - 3 " // -Nov- 537 1 TUF PARTS TRADING Cement 07 " WWWWWWWWWWWWWWWWWWWWWWW 3 ~ 00 . 00 31 Dec - WWW- -3"- Constructi on ''YYYYYYYYYYYYYYY 2'' 01 materi als - 580 .00 Materi als for repair of electirc motor for power sprayer 1 200 .00 Total - P231,409.24 - - 2. Power/Gasoline I I I Date I_Amount Exhibit OR/Invoice Payee 1----c-- - - - No. Power " BBBBBBBBBBBBBBBBBBBBBBBBBB-4 " 1 //-Feb-0 / 1 060 / 4// 1 Ba l angas 11 Electric Cooperative, 1nc. I_ 2 of 10

CTA Case No. 8375 ANNEX A Village Green Hog Farm, Inc. vs. CIR . ~- . -~ "DDDDDDDDDDDDDDDDDDDDDDDDDD2" " FFFFFFFFFFFFFFFFFFFFFFFFFF 2" 16 Mar 07 06171H * Batan9as II Electnc Cooperative, Inc. 9HS .95 " HHHHHHHHHHHHHHHHHHHHHHHHHH-7" 1H Ap r 07 06HS776 1 ~-May-O/ 01760* 7 Batan~Jas II Electric Cooperative, Inc. 1,21H .SO \'xxxxxxxxxxxxxxx 1,, 23 May 07 07SH112 79-Jun-0 / 0 / 98874 Batangas 11 Electric Cooperative, 1nc. 1,788 . 0~ "YYYYYYYYYYYYYYYYY- 1" 30 Jun 07 076S632 " KKKKKKKKKKKKKKKKKKKKKKKKKK 2" 0808160 -- - -- ''AAAAAAAAAAAAAAA-1 '' ~-Jul-0 / Batan9as II Electric Cooperative, Inc. S1,073.90 ~BBBBBBBBBBBBBBBBB-r - ~ 083961~ 19-Jul-0 / Batangas II Electric Cooperative, Inc. 4 9 , / 4 6 .00 ~ccccccccccccccccc :L�' 31 Jul 07 OH17639 - 71-Aug-0 / 0880913 ~ -- " DDDDDDDDDDDDDDDDDD-1 " 3 1 AU ~l 07 OHHH1HO 1,07S.HS 70-Sep-0 / 09719 // Batan9as II Electric Cooperative, I nc. ~EEEEEEEEEEEEEEEEE 1" - 29 Sep 07 09 30713 19 Nov 07 09720S9 Batangas 11 Electric Cooperative, 1nc. 4,763.90 "FFFFFFFFFFFFFFFFFF- 1" 70-Nov-0/ "GGGGGGGGGGGGGGGGGG 1H 20 Dec 07 ******* -~ - "UUUUUUUUUUUUUUUUUUUUUUUUUU 2" 26 Sep 07 1016630 Ba tangas II Electric Cooperative, Inc. 41,/73 . 1~ 71 - Sep -0 / " 111111111111111111 - 1 1S Nov 07 12722 Batan9as II Electric Cooperative, Inc. - "JJJJJJJJJJJJJJJJJJ 1" 7 1-Nov-0/ 47/73 Subtotal 6S12S 9,1S6.70 Gasoline 6~66 / Batangas 11 Electric Cooperative, 1nc. 47, 181 . 0~ :r� " 11111111111111111111111111 -- -�- " I I I I I I I I I I I I I I I I I I I I I I I I I 1-3" "WWWWWWWWWWWWWWWWWWWWWWWWWW 2" Bat<mcJas II Electric Cooperative, Inc. 10,16S.10 " WWWWWWWWWWWWWWWWWWWWWWWWWW -7" Subtotal Sa tangas I I Electric Cooperative, Inc. 4~ , 1 /3 . 8~ r-=- - Total BatarHJas II Electric Cooperative, Inc. 1,SH3.0S Batan~Jas II Electric Cooperative, Inc. 1,HH6.HO Satang as II Electric Cooperative, Inc. 47,689 .00 --- - BatarHJas II Electric Cooperative, Inc. 1S,902.10 P354,475.40 ~- - Rico Shel l " 1S1.00 Rico Shell - 1,/1 6.0Q___ Petron Corporation 1 000 .00 Pet.ron Corporation - 1,000.00 ~ - p 4,170.00 - f-- P358,645.40 ~ 3. Taxes and Licenses Exhibit Date OR No. Payee Amount "JJJJJJJJJJJJJJJJJJJJJJJJJJ- ~" 1~-Jun-O / 0467364 Lipa Cily Treasurer's Offi ce ~ tal -- f> 10.00 p 10.00 4. Representation - ---- Exhibit Date OR No. Payee -r- "Amount -- 7 Feb 07 A 001993 - " KKKKKKKKKKKKKKKKKKKKKK 1H - Mt. Malarayat Golf & Country Club, 3,SOO.OO Inc. p 3,500.00 Total 5. Office Supplies/Miscellaneous Exhibit I Date I I OR/Invoice Payee I Amount No. - ----~ Office Supplies "ZZZZZZZZZZZZZZZZZZZZZZZZZ 7" 10 Jan 07 1S6SS NS Ocana, Inc. 11-Jan-0 / I ~ / 11 "ZZZZZZZZZZZZZZZZZZZZZZZZZ- /" 2 Feb 07 16S10 NS Ocana, Inc. ~-7~ 9-Mar-0/ 1/977 7H.OO " """"""" .AAAAAAAAAAAAAAAAAA H" 21 Mar 07 NS Ocana, Inc. 101 . 7~ 74-Mar-0/ 007S1HS :~ S16 .00 "CCCCCCCCCCCCCCCCCCCCCCCCCC-6" 74-Mar-0/ NS Ocana, Inc. ~8~ . ~0 3639 970.00 - 16366 YKL Photo Center "EEEEEEEEEEEEEEEEEEEEEEEEEE H" National Bookstore "EEEEEEEEEEEEEEEEEEEEEEEEEE-8 " - - - Silicon Valley -- "EEEEEEEEEEEEEEEEEEEEEEEEEE-3" �- ~ -- - 3 of 10

CfA Case No. 8375 ANNEX A Vil lage Green Hog Farm, Inc. vs. CIR "EEEEEEEEEEEEEEEEEEEEEEEEEE 3" 15 Mar 07 13159 CDR KincJ 100.00 17 Mar 07 1080 National Bookstore 52.00 "EEEEEEEEEEEEEEEEEEEEEEEEEE 8" 13-Mar-0/ Patricia Jewels Collection Store 71 .00 7 Apr 07 149~~ National Bookstore 16.25 "EEEEEEEEEEEEEEEEEEEEEEEEEE-10" /-May-O/ NS Ocana, Inc. 11.00 11 May 07 7263 NS Ocana, Inc. ~GGGGGGGGGGGGGGGGGGGGGGGG7" 18-May-0/ NS Ocana, Inc. 300.00 //-May-O/ 198~ 0 NS Ocana, Inc. 8.00 "GGGGGGGGGGGGGGGGGGGGGGGGGG-1" 26 May 07 NS Ocana, Inc. "IIIIIIIIIIIIIIIIIIIIIIIIII 6" 76-May-0/ 20093 NS Ocana, Inc. 1~ . 00 21 Apr 07 /0/61 NS Ocana, Inc. "LLLLLLLLLLLLLLLLLLLLLLLLLL-4" 1 /-Apr-0/ /03** NS Ocana, Inc. 10.75 28 Jun 07 20532 NS Ocana, Inc. "LLLLLLLLLLLLLLLLLLLLLLLLLL-4" 21 Jun 07 NS Ocana, Inc. 71 -Jun-O/ /0~3 * NS Ocana, Inc. ~LLLLLLLLLLLLLLLLLLLLLLLLL 1" 25 Jun 07 NS Ocana, Inc. /3-Jun-0/ 19365 NS Ocana, Inc. " LLLLLLLLLLLLLLLLLLLLLLLLLL-4" 9 Jul 07 19*** NS Ocana, Inc. /0-Jul-0/ 21711 NS Ocana, Inc. - -- 70-Jul-0 / 211 ** NS Ocana, Inc. " LLLLLLLLLLLLLLLLLLLLLLLLLL 1" 16 Jul 07 /1463 NS Ocana, Inc. 5.00 /4-Jul-0/ 215 * * NS Ocana, Inc. "LLLLLLLLLLLLLLLLLLLLLLLLLL-4" 21 Jun 07 Gilid nCJ Eskwela Gen. Mdse. 1~/ . 00 /1~36 NS Ocana, Inc. f-c,:,:-L:--L:-:L-:L-:L-cL-:L-LLLLLLLLLLLLLLLL-LL-L 1' - /~-Jul-0/ NS Ocana, Inc. 6.25 22091 *** & Shen Xerox Copyer & Gen. "LLLLLLLLLLLLLLLLLLLLLLLLLL 1" 27 Jul 07 //631 Mdse. :n.75 9 AUCJ 07 //6/8 National Bookstore "LLLLLLLLLLLLLLLLLLLLLLLLLL-4" 2212] Gilid nCJ Eskwela Gen. Mdse. 31 . /~ 9-Aug-0/ NS Ocana, Inc. 12 .77 ~LLLLLLLLLLLLLLLLLLLLLLLLL 1" 17 Jul 07 //31~ NS Ocana, Inc. 4.00 /1 -Aug-0/ NS Ocana, Inc. 11 .75 "LLLLLLLLLLLLLLLLLLLLLLLLLL-4" 30 AUCJ 07 oon National Bookstore l- ,::,cN--:-Nc-cN-..N,-,.N,--'N-N,.-N, NNNNNNNNNNNNNNNNNN 7" 1-Sep-0/ Gilid ncJ Eskwela Gen. Mdse. 18./~ Sep-0/ //801 NS Ocana, 1nc. /3.~0 "NNNNNNNNNNNNNNNNNNNNNNNNNN-/" 13 AUCJ 07 22898 NS Ocana, Inc. /-Sep-0/ 0996 NS Ocana, Inc. 8.00 "NNNNNNNNNNNNNNNNNNNNNNNNNN-/" 25 Sep 07 NS Ocana, Inc. 1 /-Aug-0/ 996~ NS Ocana, Inc. 10 . ~0 "NNNNNNNNNNNNNNNNNNNNNNNNNN 7" 21 Sep 07 National Bookstore 1 Oct 07 0158 NS Ocana, Inc. 181 .00 "NNNNNNNNNNNNNNNNNNNNNNNNNN-/" 7-0ct-0/ NS Ocana, Inc. 21 Sep 07 /3//~ First Macro TradincJ, Inc. 1~0 . 00 " 'NNNNNNNNNNNNNNNNNNNNNNNNNN 7" 18-Sep-0 / NS Ocana, Inc. 22 Sep 07 21026 National Bookstore 226.50 "NNNNNNNNNNNNNNNNNNNNNNNNNN-/" 1-0ct-0/ /410/6 NS Ocana, Inc. 18 .00 30-Nov-0/ NS Ocana, Inc. "NNNNNNNNNNNNNNNNNNNNNNNNNN 7" 9 Nov 07 /469 14./~ 1 / - Nov - 0 / "NNNNNNNNNNNN NNNNNNNNNNNNNN 7" **** 120.00 /49.00 "NNNNNNNNNNNNNNNNNNNNNNNNNN-/" /446~ 1--;;-NNNNNNNNNNNNNNNNNNNNNNNNNN 7" 3.75 21865 1-- - /36% 1.~ 0 21886 4/8.~0 25187 9810 107.00 21796 "SSSSSSSSSSSSSSSSSSSSSSSSSS-6" 15 .25 "SSSSSSSSSSSSSSSSSSSSSSSSSS 6" 398/~3 "SSSSSSSSSSSSSSSSSSSSSSSSSS-6" 1 . ~0 "SSSSSSSSSSSSSSSSSSSSSSSSSS 6" 101313 A "SSSSSSSSSSSSSSSSSSSSSSSSSS 6" 66.00 "SSSSSSSSSSSSSSSSSSSSSSSSSS-6" /~161 4~96 1.50 ~SSSsSSSSSSSSSSSSSSSSSSSS 6" 26503 3~1 . /~ "SSSSSSSSSSSSSSSSSSSSSSSSSS-6" 76/1/ ~vvvvvvvvvvvvvvvvvwvvvvv-~" - 127.50 - 43~ . 00 Subtotal 150.00 91 . ~0 388 .00 11 .75 -- p 6,646.27 Communication ~-''z_z_z_zz_z_z_z_zz_z_z_z_zz_z_z_z_zz_z_z_z_z_8_"____________~___6_J_a_n_o_7__~___1_o_L1_ ___L_*_**_L_e_ir_lE_I_ec_:tr_o_n_ic_s _c_or_p_. _________L__P____8_5:_-, ._oc~J ~ 4 of 10

CTA Case No. 8375 ANNEX A Village Green Hog Farm, Inc. vs. CIR - - 28 Mar 07 019 - "EEEEEEEEEEEEEEEEEEEEEEEEEE 9" 29 May 07 17"10 Mari's Loadinq 'N Celfone Accessories Center 295.00 "LLLLLLLLLLLLLLLLLLLLLLLLLL 5" 1 ~-Jun-O/ 149/8 Zaide TradincJ 290.00 "LLLLLLLL LLLLLLLLLLLLLLLLLL-~ " 08~1 *** /9~ . 00 --~- / 40788 p 1,735.00 Subtotal 7"10289 --- �- - 060/14 --- - Transportation /3-Feb-0/ 253218 Jhon & Jhon Farms r 3,000.00 "SS-/" 1/-Mar-0/ Joyselle Express, Inc. --- ~EEEEEEEEEEEEEEEEEEEEEE-1 0"- 6093/6 Joyselle Express, Inc. 12 Mar 07 *** 10 .00 ~EEEEEEEEEEEEEEEEEEEEEEEE 10" 275999 Cher Transport 19-Apr-0/ 2756000 Mayamy Transport - --- "GGGGGGGGGGGGGGGGGGGGGGGGGG-8" Marlea Transport - 7/~998 Marlea Transport 10.00 "GGGGGGGGGGGGGGGGGGGGGGGGGG 8" Marlea Transport 19 Apr 07 751622 MLI 1.00 "GGGGGGGGGGGGGGGGGGGGGGGGGG-8" *** 19-Apr-0/ 039067 - -- ---- - 9.00 6 Jul 07 8"15236 6 Jul 07 P.C.L. Transport --- 10 .00 039061 6-Jul-0 / *** "1.00 6 Jul 07 "1 .00 - -- 16-Aug-0/ 4.00 16 Auq 07 --- 16-Aug-0/ 10.00 -- ~---- 30 Jan 07 6 .00 1 /-May-O/ -- 5 Jul 07 10 .00 16 AU CJ 07 Subtotal --- - 6.00 -- --- --- p 3,084.00 - Miscellaneous "16"1755 PNCC Skyway Corporation - PNCC Skyway Corporation ~ ~4306~ PNCC Skyway Corporation p 2,000.00 PNCC Skyway Corporation "BBBBBBBBBBBBBBBBBBBBBBBBBB 5" 575961 7,000 .00 60"1675 --- - - -~ --- Subtotal 2,000 .00 - 2,000.00 p 8,000.00 Total -- P19,465.27 6. Insurance/Fees/Other Charges ---- I I I Date Payee ~ -Amount OR No. Exhibit 8 Auq 07 "12"1"1 - -p - Other Charges 1"1 Sep 07 "l :n7 Uqnayan Security Acwncy, Inc. 10,000.00 -- - 30-Aug-0/ 4798 Uqnayan Security A\wnc:y, Inc. Ugnayan Security Agency, Inc " IIIIIIIIIIIIIIIIIIIIIIIII 2" 26 Sep 07 "1390 U\Jnayan Security Acwncy, Inc. Ugnayan Security Agency, Inc "LLLLLLLLLLLLLLLLLLLLLLLLL 2" 1 /-Oct-O/ 4436 UcJnayan Security A\Jenc:y, Inc. 10,000.00 "MMMMMMMMMMM MMMMMMMMMMMMMM -/" 28 Nov 07 "159"1 10,000 .00 - -- -- "0000000000000000000000000 2" 9,250.00 "RRRRRRRRRRRRRRRRRRRRRRRRR-1 " 6,000 .00 "SSSSSSSSSSSSSSSSSSSSSSSSS 1" 10,000.00 Total p 55,250.00 7. Purchases (Direct Farm Inputs) Sales Invoice/ Official Receipt Exhibit Date Number Supplier Amount "SS-/" JHON & JHON FARMS INC. p 100,000.00 'TT- -l" /f/3/01 08~1 PHILIPPINE ASSOCIATION OF HOG RAISERS "UU 2" LA FILIPINA UYGONGCO CORP /6 7~0 . 00 3/ 13/ 01 13/1 ~ 391 510.00 1/8/07 2808"1 5 of 10

CTA Case No. 8375 ANN EX A Village Green Hog Farm, Inc. vs. CIR "WW- -1" 1/4/01 7896 CASTLE MARKETING 7,~96 . 00 1/1/07 20718 MAYERVET DISTRIBUTION "XX 111 1/3/07 0753 TRI GEM MARKETING 1022.60 "YY 1" 1/3/01 TRI-GEM MARKETING 28,100.00 3/12/07 01~3 PHILIPPINE SUPER FEED CORP. "YY- -1" 1/10/01 CASTLE MARKETING I /00 .00 "AAA 3" 1/11/0/ 17218 CASTLE MARKETING 297 262.00 "EEE- 1" 1/11/07 7911 CASTLE MARKETING "EEE-7" 1/10/01 7913 TRI-GEM MARKETING /,940 .00 "EEE 2" 1/17/07 2913 TRI GEM MARKETING 17,699.00 "FFF-1" 1/17/07 TRI GEM MARKETING 26,000.00 "NNN 1" 3/76/ 0/ 01~1 PHILIPPINE SUPER FEED CORP. "NNN 1" 1/29/07 RNT ENTERPRISES, INC. 10,8~0 . 00 "QQQ-7" 1/74/01 0760 TRI-GEM MARKETING "RRR 1" 1/74/01 0760 TR I-GEM MARKET! NG 28100.00 "VVV-1" 1/25/07 TRI GEM MARKETING 7,200.00 "VVV-1" 4/4~8 TRI-GEM MARKETING "VW2n 1/7~/0/ TRI GEM MARKETING 473 6/1 .00 "VVV-7" 6061 TRI GEM MARKETING 1 250.00 "WV3" 1/26/07 0161 TRI-GEM MARKETING /,100 .00 "WV3" 1/26/07 0161 TRI GEM MARKETING 6 700.00 " VVV - 3 " I f/6/01 0769 CASTLE MARKETING 7,100 .00 "YYY 1" 2/2/07 0169 J.M. MENDOZA ENTERPRISES 1,/00.00 "AAAA-1" 1/31/0/ 0772 11 200.00 "BBBB-1" I j/6/01 0772 JEIDI FARM SUPPLY CORPORATION 6,200.00 "FFFF 1" 2/5/07 0117 1,/00.00 "FFFF-7" 4/74/01 0771 TRI GEM MARKETING "HHHH 1" 2/5/07 7943 TRI GEM MARKETING 62 000.00 "HHHH 1" 2/5/07 TRI -GEM MARKETING " HHHH - 7 " /f9f01 1634 7~ CASTLE MARKETING 7,~96 . 00 "JJJJ 1" 2/6/07 CASTLE MARKETING "JJJJ-1 " /!6/01 58191 PHILIPPINE ASSOCIATION OF HOG RAISERS, INC. 7 79~.77 "LLLL-7" 4/ 16/ 01 VET PROGEN CORPORATION 2/ 15/07 10~/0 8,7~0 . 00 "000 1" /f/ 1/01 INGASCO, INC. 5/2/07 0776 17 750 .00 "RRRR-1 " 2/22/07 0776 TRI GEM MARKETING 18,000 .00 "RRRR 3" /f/// 01 0118 TRI-GEM MARKETING 78 400 .00 "TTTT 1" 2/22/07 2960 TRI GEM MARKETING "TTTT-7" /f/3/01 7960 TRI-GEM MARKETING 7 500.00 "TTTT 2" /f/3/01 13//4 TRI-GEM MARKETING 3,000 .00 "TTTT-3" 2/ 16/ 07 00127 CASTLE MARKETING 26,250.00 "TTTT-3" /f/0/01 CASTLE MARKET! NG 3,600.00 "UUUU 1" 738~~/ " UUUU-7" 2/21/07 CASTLE MARKETING ~60 . 00 138918 "UUUU 3" /f/1 / 01 0786 CASTLE MARKETING 1,000.00 /f/ 1/01 3 600.00 "UUUU-3" 5/8/07 018~ JEIDI FARM SUPPLY CORPORATION 8 875.00 "YYYY-7" 8,8h00 "YYYY 1" ~f / f OI 0785 TRI-GEM MARKETING 14 400.00 "ZZZZ-1" 0188 RNT ENTERPRISES INC. 3,970 .00 "CCCCC 1" 3/1/ 07 0/88 CASTLE MARKETING /,940 .00 "EEEEE 1" 2/ 27/07 2982 CASTLE MARKET! NG "EEEEE-1" /f/ 1/01 798/ 7 500.00 2992 7,900 .00 7997 3,000.00 ~896/ 1/,/~0. 00 1 250.00 10580 2,596.00 0/91 3,000.00 6381 3053 30~3 6 of 10

CTA Case No. 8375 ANNEX A Village Green Hog Farm, Inc. vs. CIR "HHHHH-1" 'J/ 1/0 1 019) TRI-GEM MARKETING 1/,/)0 .00 "HHHHH 1" 5/ 7 / 07 0792 TRI GEM MARKETING 9 000.00 "KKKKK 1" 3/9/07 3069 CASTLE MARKETING 12,699.00 "KKKKK-/" 3/9/01 3010 CASTLE MARKET! NG ) 900 .00 "KKKKK 2" 3/9/07 3070 CASTLE MARKETING 3,970.00 "NNNNN-1" 3/1 'J/ 01 0 191 TRI -GEM MARKETING 1/,/)0 .00 "NNNNN-1 " 3/1 'J/ 01 0 191 TRI -GEM MARKETING I) 600.00 "00000 1" 3/3/07 163905 J.M. MENDOZA ENTERPRISES 2,295.22 "PPPPP-1" 3/11/0/ 6106 JAPS VETERINARY CLINIC & VETERINARY SUPPLY /,000.00 "QQQQQ 1" 3/B/07 3071 CASTLE MARKETING 3 000.00 "QQQQQ 1" 3/B/07 3071 CASTLE MARKETING 7,500.00 "SSSSS-/'' 'J j) i/ 01 13 /3 1 PHLIPPINE ASSOCIATION OF HOG RAISERS, INC /6 /)0.00 "WWVl'' 3/20/07 00956 VET PROGEN CORPORATION 3 600.00 "YYYYY-1" 3/1 'J/01 0/94 TRI-GEM MARKETING 4),000 .00 "YYYYY-/" 3////01 0801 TRI-GEM MARKETING 14 400.00 "ZZZZZ 1" 3/19/07 3089 CASTLE MARKETING 7,910 .00 "ZZZZZ-/ " 3////01 3094 CASTLE MARKETING / 6 , 0 0 0 .00 "ZZZZZ 3" 31()1 CASTLE MARKETING 3,750.00 "ZZZZZ 3" :~/23/ 07 31()1 CASTLE MARKETING 2,900.00 "CCCCCC-1" 'J9611 "CCCCCC 2" 3/ 23/ 07 10777 JEIDI FARM SUPPLY CORPORATION 1,000 .00 "EEEEEE-1" 3f/6f 01 61/3 "FFFFFF-1" 6/8/07 31/8 RNT ENTERPRISES, INC 4,/'JO .OO "HHHHHH 1" 4/4/0/ 0808 CASTLE MARKET! NG 14,690 .00 "JJJJJJ-1" 4} 4/ 01 31/0 TRI GEM MARKETING "LLLLLL 1" 1 / 1 / 07 :H12 CASTLE MARKET! NG 7,600.00 "LLLLLL 2" 3/30/01 3Wi CASTLE MARKETING 4,164.00 "LLLLLL-3" 1/ 12/ 07 3148 CASTLE MARKETING 2 900.00 "NNNNNN 2" 1/17/07 211201 CASTLE MARKET! NG 3,300 .00 "NNNNNN-3" 4/18/0/ /41/00 38,699.00 "NNNNNN-1" 1/11/07 441/31 INGASCO, INC "000000 1" 4/11/0/ 0813 ),360.00 "000000-/" 1/6/01 0816 TRI GEM MARKETING "QQQQQQ 2" 1/10/07 18627 TRI-GEM MARKETING 10,800.00 "SSSSSS 1" 4/ 13/ 01 0598 PHILIPPINE SUPER FEED CORP. 4),000 00 "UUUUUU-/" 6/28/07 13/4/ JHON & JHON FARMS INC. 391 366.00 "WWWWWW 1" 6/18/07 6878 PHILIPPINE ASSOCIATION OF HOG RAISERS, INC 100,000 .00 "XXXXXX -1 " I f// 01 00986 RNT ENTERPRISES INC. 3'J,OOO 00 "YYYYYY-1" 1/26/ 07 0819 VET PROGEN CORPORATION 1 250.00 ''AAAAAAA 1'' 4/ 4/01 3165 TRI-GEM MARKETING "'DDDDDDD-1" 4//3/0/ 334)) CASTLE MARKETING 3,600.00 "FFFFFFF 1" 1/25/07 3183 LA FILIPINA UYGONGCO CORP 'J9 400.00 "HHHHHHH 1" 'J/8/ 0 1 33156 CASTLE MARKETING 16,120.00 "KKKKKKK -1 " 5/ 2 / 07 101 LA FILIPINA UYGONGCO CORP 8 8 , 6 ) 0 .00 "KKKKKKK 2" 5/8/07 077 R & B TRADING 'J/8/ 01 R & B TRADING 2 900.00 "LLLLLLL-1 " 5/10/07 3 193 392,360.00 "NNNNNNN-1" 60446 CASTLE MARKET! NG "NNNNNNN 2" 'J/ 8/01 11120 3,600.00 "111 1111-1" )/ 1/01 08/) JEIDI FARM SUPPLY CORPORATION 150.00 7/19/07 'J/ 9/01 TRI-GEM MARKETING 8,3/0.00 500.00 )),800 .00 7 of 10

erA Case No. 8375 ANNEX A Village Green Hog Farm, Inc. vs. CIR "VVVVVVV-1" ':>/1 ':>/01 3/01 CASTLE MARKETING 10,100 .00 '.i/22/07 3219 CASTLE MARKETING 19 319.00 "CCCCCCCC 1" 6/21/07 01009 VET PROGEN CORPORATION ':>/ 18/01 164384 J.M. MENDOZA ENTERPRISES 3,600.00 "DDDDDDDD 1" '.i/23/07 096 R & B TRADING 7,79':>.77 ':>/18/01 0830 TRI-GEM MARKETING 3 600.00 "EEEEEEEE-1" '::Jj/9/01 3730 CASTLE MARKETING 10,400 .00 '.i/17/ 07 OH31 6,800 .00 "GGGGGGGG 1" 6/1/01 0831 TRI-GEM MARKETING 6/'.i/07 1191 ':>4,400 .00 "HHHHHHHH-1" 6/2/07 OH39 BROADCHEM CORPORATION 6!77/01 3':>10 1 TRI GEM MARKETING 21 '.iOO.OO "MMMMMMMM-1" H/21/07 137'.i2 LA FILIPINA UYGONGCO CORP '.i2,27'.i.OO 6/17/01 084':> PHILIPPINE ASSOCIATION OF HOG RAISERS INC. 389,810 .00 "NNNNNNNN 1" 6!9/01 1303 TRI-GEM MARKETING 3'.i,OOO.OO 6/'.i/07 32'.i1 RNT ENTERPRISES, INC. 14,400 .00 "NNNNNNNN-7" 6/17/01 4101 CASTLE MARKETING 6/2'.i/07 1617'.i6 BROADCHEM CORPORATION 4 7':>0.00 "PPPPPPPP 1" 6/2'.i/ 07 3266 J.M. MENDOZA ENTERPRISES 1'.i,3H1. 00 6/73/01 083':> CASTLE MARKETING 11,':>00 00 "RRRRRRRR=1" 6/12/07 011'.i6 TRI-GEM MARKETING 6/19/01 4671 NUTRITECH VENTURES INC. 2 29'.i.22 "I I I I I I I 1-1" 6/1 '::J/01 084 1 BROADCHEM CORPORATION 11,200.00 6/13/07 32'.i2 TRI-GEM MARKETING 30 144.00 "UUUUUUUU 1" I / 13/ 01 36894 CASTLE MARKETING 117 '.iOO .OO 7/7/07 0907 LA FILIPINA UYGONGCO CORP 74,':>00 .00 "WWWWWWWW-1" 10/9/07 13763 TRI GEM MARKETING 36 000 .00 10/9/01 71863 PHILIPPINE ASSOCIATION OF HOG RAISERS, INC. 10,396.00 "YYYYYYYY -1 " 7/ '.i/07 1'.i7 PHILIPPINE ASSOCIATION OF HOG RAISERS, INC. 73,400.00 1/3/01 3719 R & B TRADING "ZZZZZZZZ 1" 6!77/01 01':>14 CASTLE MARKET! NG 3 67'.i.OO 7/20/07 01H'.i9 NUTRITECH VENTURES, INC. 3'.i,OOO .OO "CCCCCCCCC-7" 1/3 1/ 01 16':>089 NUTRITECH VENTURES, INC. 7/13/07 0910 J.M. MENDOZA ENTERPRISES 717 .00 "DDDDDDDDD 1" 11 / 3 / 07 OH6H6 TRI GEM MARKETING 3 600.00 1/19/ 01 67049 LA FILIPINA UYGONGCO CORP 8,170 .00 "EEEEEEEEE 1" 10/ 2 3 / 07 1193H ':>6,/':>0 .00 1/1// 01 6130 JEIDI FARM SUPPLY CORPORATION 19,6'.i0.00 "FFFFFFFFF-1" I /6/0I 163 7,7':>0 .00 7n/07 090'.i JAPS VETERINARY CLINIC & VETERINARY SUPPLY 36 000.00 "GGGGGGGGG 1" 1/3/01 3/8':> R & B TRADING 101,1'.i0.00 7/ 27/ 07 01936 TRI GEM MARKETING "HHHHHHHHH - 1" 7/ 27/ 07 11201 CASTLE MARKETING 10,17'.i.OO I / 16/01 3318 NUTRITECH VENTURES INC. "111111111 -1" 7/21 / 07 DICONEX PHILS INC 7,000 .00 1/30/01 :rns CASTLE MARKET! NG 7,770 .00 "KKKKKKKKK 1" 1/3/01 CASTLE MARKETING 36, 000.00 7/11/07 3341 CASTLE MARKET! NG 38,699 .00 "MMMMMMMMM-1" 1/1 0/01 4184 BROADCHEM CORPORATION '.i 000.00 7'.iH6 RNT ENTERPRISES, INC. 7,2'.i0.00 " 1" 3303 CASTLE MARKETING 17,110.00 10 916.00 "lllllllll 2" 7,900.00 1I ':>00.00 "111111111-1" 1,2'.i0.00 8,370 .00 ''VWVWWV 1'' "WWWWWWWWW-1" "XXXXXXXXX -1 " ''AAAAAAAMA 1'' "CCCCCCCCCC -1" "DDDDDDDDDD 1" "FFFFFFFFFF 1" "HHHHHHHHHH-1" "HHHHHHHHHH 2" "JJJJJJJJJJ-1 .. "LLLLLLLLLL-1" "0000000000 1" "PPPPPPPPPP-1" "UUUUUUUUUU 1" "VVVVVVVVVV 1" "WWWWWWWWWW-1" "WWWWWWWWWW 2" "WWWWWWWWWW-3" "XXXXXXXXXX -1 " ''YYYYYYYYYY 1'' "AAA.AAAAMA.A-1 .. 8 of 10

CTA Case No. 8375 ANNEX A Village Green Hog Farm, Inc. vs . CIR "FFFFFFFFFFF-1" /fll/01 4860 BROADCHEM CORPORATION 10,~00 . 00 9/18/07 212083 PREMIUM AGRO VET PRODUCTS INC. "GGGGGGGGGGG 1" 7/25/07 BROADCHEM CORPORATION 13 750.00 /f/4/01 5516 TR I-GEM MARKETING 10,500.00 "LLLLLLLLLLL 1" 8/23/07 0914 36 000.00 1/fl/01 62838 JEIDI FARM SUPPLY CORPORATION " MMMMMMMMMMM -1" 8/13/0/ 1,1~0 . 00 7/30/07 1')/~ 4 BIOSAFE MARKETING "PPPPPPPPPPP 1" 8/1/01 088~ TRI GEM MARKETING ~,400 . 00 8/21/07 R & B TRAD ING "PPPPPPPPPPP-/" 8/19/07 0916 R & B TRADING 1,000.00 8/11/01 19/ JAPS VETERINARY CLINIC & VETERINARY SUPPLY 6,//0 .00 " -1" 8/3/07 228 NUTRITECH VENTURES INC. 2 880.00 8/14/01 6712 TRI GEM MARKETING " RRRRRRRRRRR 1" 9//0/01 0')')18 CASTLE MARKETING 950.00 12/ 17/07 0918 LA FILIP INA UYGONGCO CORP "VVVVVVVVVVV-1" 8/14/01 3313 PHILIPPINE ASSOCIATION OF HOG RAISERS, INC. 4~,000 . 00 8/9/07 41/1/ TRI-GEM MARKETING ��xxxx:xxxxxxx 1'' 8/22/07 13771 BROADCHEM CORPORATION 36 000 .00 9f/9f01 093/ CASTLE MARKETING 6 , n o .oo ''YYYYYYYYYYY 1II 8/23/07 5085 ROMAR FEED SUPPLY CORPORATION 8/')')/01 3393 TRI GEM MARKmNG 401 9/~ . 00 "ZZZZZZZZZZZ-1 " 8//4/0/ RNT ENTERPR ISES, INC. 26,250.00 8/31/07 /~83~ CASTLE MARKETING 36,000 .00 ''AAAAAAAAAAM 1'' 8//8/01 PNEUMOVAC TRADING 7 000.00 9/25/07 09:-!6 CASTLE MARKET! NG 8,320.00 "BBBBBBBBBBBB-1" 8/1/07 /989 R & B TRADING 14,000.00 9/4/01 3399 CASTLE MARKETING 21 675.00 "CCCCCCCCCCCC-1" 12/1/07 3331 TRI-GEM MARKETING 1/10/ 08 4,/~0 . 00 " FFFFFFFFFFFF 2" 91/9/01 340~ CAC TEC HNOLOGY CORPORATION 11/7/07 38 699 .00 "HHHHHHHHHHHH -1" 11 /~/0/ 271 JEIDI FARM SUPPLY CORPORATION 3,600.00 11/8/07 3120 DICONEX PHILS INC 6,6~8 . 00 "IIIIIIIIIIII 1" 9/11/07 LA FILIP INA UYGONGCO CORP 6 960.00 9/18/0/ 09~1 ROMAR FEED SUPPLY CORPORATION "JJJJJJJJJJJJ 1" 9/1/07 CASTLE MARKETING 11,960.00 9/11/01 INV7 68 CASTLE MARKET! NG 36 000 .00 "MMMMMMMMMMMM -1" 9/'?6/01 0948 BROADCHEM CORPORATION 9/27/07 636~6 TRI -GEM MARKETING 1,980.00 "000000000000 1" 11/4/ 01 11082 NUTRITECH VENTURES, INC. 9/23/07 01614 PREMIUM AGRO VET PRODUCTS INC. 3 4~0.00 "PPPPPPPPPPPP-1" 9/21/07 26130 PHILIPPINE SUPER FEED CORP. 5,625 .00 I 0/4/0/ 3137 INGASCO INC. " -1" 9/21/07 INGASCO, INC. 44~, 18~ . 00 10/8/ 0/ 34~0 PREMIUM AGRO VET PRODUCTS INC. "111111111111 1" 11//1/0/ CASTLE MARKETING 7 000.00 11/20/07 5296 NUTRITECH VENTURES, INC. 5,198.00 "UUUUUUUUUUUU-1" 11 / /1 / 0/ 09~~ 1 0 , 1 4 0 .0 0 0/601 LA FILIPINA UYGONGCO CORP 7 000.00 ''YYYYYYYYYYYY 1'' 212392 1/,000.00 "ZZZZZZZZZZZZ 1" ~164/ 16/~0.00 "EEEEEEEEEEEEE-1" 27111:-! 18,000.00 251623 "FFFFFFFFFFFFF 1" /4/46/ ~4/,640 . 00 "FFFFFFFFFFFFF-')" 3169 1 800.00 0/1/0 560.00 "GGGGGGGGGGGGG-1 " 0')')4~ 113h00 "JJJJJJJJJJJJJ 1" 3 638.00 23253 "MMMMMMMMMMMMM-1" n ,3h00 ~664 "0000000000000 1" 169,757.50 "PPPPPPPPPPPPP 1" "PPPPPPPPPPPP-/" " 1" "RRRRRRRRRRRRR-1" "SSSSSSSSSSSSS-1 " "I I I I I I I I I I I I I 1" "VVVVVVVVVVVVV-1 " ''XXXXX:XXXXXXXX 1'' "XXXXX:XXXXXXXX 3" " DDDDDDDDDDDDDD-1" "HHHHHHHHHHHHHH 1"' " KKKKKKKKKKKKKK-1 " "MMMMMMMMMMMMMM-1" "MMMMMMMMMMMMMM 3" "MMMMMMMMMMMMMM-4" 9 of10

CTA Case No. 8375 ANN EX A Village Green Hog Farm, Inc. vs. CIR ~.800 . 00 "PPPPPPPPPPPPPP-1" 11/1~/0/ 11689 DICONEX PHILS INC 3179 CASTLE MARKETING 9 358.00 " 1" 10/ 2/ 07 02791 NUTRITECH VENTURES, INC. 91,875 .00 10/15/07 PNEUMOVAC TRADING 91000 .00 "RRRRRRRRRRRRRR 1" 10/9/ 0/ 34~8 PNEUMOVAC TRADING 17 390.00 10/ 12/ 07 PNEUMOVAC TRADING "SSSSSSSSSSSSSS-1" 10/ 13/ 0/ 3169 CASTLE MARKETING 1,110.00 10/9/ 0 / 34/1 PNEUMOVAC TRADING ''VWVWVWWVW 1�' 10/ 26/ 07 349 / CASTLE MARKETING / , ~60.00 10! // / 01 3529 TRI GEM MARKETING "VVVVVVVVVVVVVV-/" 10/17/ 07 TRI GEM MARKETING 7,200.00 10/ 15/ 07 3~18 R & B TRADING 1/,918.00 "ZZZZZZZZZZZZZZ-1 " 11 / 6/ 01 CASTLE MARKETING 10/J0/07 0989 CASTLE MARKETING 2 125.00 "EEEEEEEEEEEEEEE 1" 10/ 6/ 0/ 0986 TRI -GEM MARKETING 39,000.00 11 / / / 01 3 1/ PNEUMOVAC TRADING ""GGGGGGGGGGGGGGG-1" 1001/ 07 3510 PNEUMOVAC TRADING / //0 .00 11 /1/ 0 / 2 900.00 "HHHHHHHHHHHHHHH 1" 12/ 20/ 07 3~4 / JEIDI FARM SUPPLY CORPORATION 8,3/0 .00 2/ 18/ 08 39,000.00 "HHHHHHHHHHHHHHH 2" 11 /1/ 0/ 0998 J.M. MENDOZA ENTERPRISES 1,070 .00 11/9/ 07 3519 INGASCO, INC. / ,880 .00 "111111111111111-1 " 11/9/ 0/ INGASCO, INC. I / f 1/01 3~ /9 ROMAR FEED SUPPLY CORPORATION 1,800.00 "KKKKKKKKKKKKKKK 1" 11/ 11/ 07 CASTLE MARKETING 11 / /0/ 0/ 65361 CASTLE MARKETING 3 44/.83 "KKKKKKKKKKKKKKK- / " 12/ 19/07 12711 DICONEX PHILS INC 560.00 12/ 7/ 07 DICONEX PHILS INC "LLLLLLLLLLLLLLL-1 " I / / 13/ 01 16~9 3 0 DI CONEX PHILS INC 4,800 .00 12/ 7/ 07 TRI GEM MARKETING 1,000 .00 "MMMMMMMMMMMMMMM 1" 11 / 19/01 251725 TRI-GEM MARKETING 2,618.00 I / / 4/ 01 TRI -GEM MARKETING 3, 618 .00 "MMMMMMMMMMMMMMM-/" 11/ 28/ 07 /~4 // 6 CASTLE MARKETING 1 500.00 1//4/ 0 / /631 ~ CASTLE MARKETING 5,800.00 "NNNNNNNNNNNNNNN 1" 12/ 12/ 07 CASTLE MARKETING 11 ,/hOO 12/1/ 07 3618 PN EUMOVAC TRADING 13 000 .00 "NNNNNNNNNNNNNNN 2" 1// 1// 01 3630 R & B TRADING 39,000 .00 12/ 11/ 07 11881 TRI GEM MARKETING /000 .00 " -1 " 1// 18/ 0 / 11817 TRI -GEM MARKETING 8,320.00 1// 11/01 NUTRITECH VENTURES INC. "RRRRRRRRRRRRRRR 2" 12/ 20/ 07 118~0 CASTLE MARKETING ~.968 . 00 I / f/6/01 ELITE ENTERPRISES "RRRRRRRRRRRRRRR-3" 11/ 11/ 07 1027 NUTRITECH VENTURES INC. 8 316.00 1009 5,700 .00 "SSSSSSSSSSSSSSS-1 " 10/3 3 840 .00 3611 10 000.00 "UUUUUUUUUUUUUUU 1" 3661 39,000.00 3682 "UUUUUUUUUUUUUUU~" 3677 ~ /~0 . 00 360 "llZZZZZZZZZZZZZ 2" 103 2 12,570.00 1034 "ZZZZZZZZZZZZZZZ 3" 033 93 4~0 . 00 3710 "ZZZZZZZZZZZZZZZ -4" / 9/18 67 625 .00 03077 P8 083 971.8 1 "AAAAAAAAAAAAAAAA 1" ''AAAAAAAAAAAAAAA- / ' ' ''AAAAAAAAAAAAAAA-3'' "BBBBBBBBBBBBBBBB 1" "BBBBBBBBBBBBBBBB- / " "BBBBBBBBBBBBBBBB 3" "EEEEEEEEEEEEEEEE 1" "HHHHHHHHHHHHHHHH-1 " "IIIIIIIIIIIIIIII 1" "11111111111 11111-/" "JJJJJJJJJJJJJJJJ-1 " "NNNNNNNNNNNNNNNN 1" "0000000000000000-1" "RRRRRRRRRRRRRRRR 2" Total 10 of 10