cta_decision CTA Case No. 36093609 1988-07-29

CTA Case No. 3609 (Decision)

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY AT LAS CON S OLIDATED HINING & DEVELOPNEN T CORPORATION, Petitioner, ..... ver :.=:u:.=: -- C.T.A. CASE NO. 3609 COffffi SS IONER OF INTERNAL REVENUE , Re s pondent . - - _';' - - - ----X D E C I I 0 N An a c: t- ion t.- o.-. z n F �.rr 1.:: e a 1.-:: laim for refund/tax - ., credit oF a n a ll e_e d ov erpa 1d income taxes For the 1980 and 1 98 1 t h e tota l oo. P B, 4 80, s~;�_:J. P et ition e r i s a do mestic c orporation regi s- te r ecl !-�lith th e Board oF lnvF..>st me n t a n d e n gaged i n t� l~ e bu :.::: .ine ::::s o �( min.in9 c opp er ore .in i t s c o n cessio n at Tol edo City. Set 'f'ort h are .it s .1980 and .t ::J8 1 qu a rter l y a nd a nn ual .inco me ta x returns re l eva n t l y s ummarized as 't'o ll oNs: 48

DECISION CTA CASE NO. 3609 -- -��� .�(�_) t. :.=~ sq .l :.::: t- quarter filed Nay .30 .� .1'.~80 .� :..:: hoNing tax due in the amount of P'.'92 .� 807 .� 06.'5.00 (Exh. B-1.1 .� paid under CB Confirmation Receipt No. A0180475 dated Nay 30, 1980 and BIR Revenue Tax Receipt No. A44831 2 3 (E x h s . B - .la and a - tb). 2 nd qu.ar ter f.i .l eel Augu :..:: t :.?�.~, 1980 s holo.Ji n q tax due .in the amount oF P40,486,403.00 (Exh. B --2), p a .id under CB Confirmation Receipt No. O .t 7:717t.. 4 d a ted Augu :.:. :t� 29, .t:-:J8CI (E :~d1. B-2a) and BIR Revenue Ta ).; Re c eipt No. A47CI6020 of the s ame date (E x h. B ���-2 b) . 3rcl quart�er fi.lecJ lhH'ember 28 .� 198(1 :;hoNing ta x due of P27,474,262.00 CExh. B- 3) paid under CB Con f i r ma t- .i o ,., Re c e .i p t No � AO .l -7 9 7 .1 2 d.-~ ted November 2 8 .� .l 9 8 0 an d B .l R Re ~~ en u e T a .Y R e c e .i p t No � A 4 9 6 61 0 6 (E:x: h. B ���- .Jb.l . ;. The annual income tax return for 1~80 (Exh. B) ::::hoNing a tota.l ta .'!\� dl.le in the amount 01~ P 16 9 .� 6 71 .� 19 .5. OCI of Nh i c: h P160 .� 767, 7.30.0t) had previously been paid a s related above. The balance of P8,90.3,465.00 Nas credited Nith the amount o �f PSS2 .� 208.00 representing credita ble taxe s t�./ithh e .ld by their payors, .leaving an unpaid 4e �

DECISION CTA CASE NO. 3609 -�� .3 �-- ba.l.1nr.: e of P8,.35 .l .� 257.00. Thi s to.~a :::; increa s ed by P.3 .� 706,77S.OO repre se nting "additiona l income ta .,..� for ac:celerated depre c iation on fully depreciated assets" (t. s .n., pp. 16 - 18J, leaving a total unpaid tax of P1 2 ,0.'58,032.00. Thi s to.~a s s ati s fied on April 1.'5, 1981 under Confirmation Receipt No. A01807t..o for P12 .� 0.'58 .� 0.32.00 (Exh. CJ a nd B.lR Revenue Tax Re c eipt No. A6617478 for the sa me amount (Exh. DJ. 1::::t� quarter return f.iled i'fay 29 .� 1'.?81 s hot<tinq t ax due of P4,774,084.00 (� x h. pa.id under Cont" irmation Receipt No. AT?187723 dated i'fay 2'.?, 1 9 8.1 for P4,.'5.16 .� 686.0f) (Exh. F - 1) and BJR Revenue T a .l<� Re c e i p t No � A.55 8 9 7.3 3 ( E :x:h � F --� 2 ) an d B I R T a.);� Credit i'f e mo No. 0842 for P 25 7,.398.00 dated January 2 n d quarter ret�urn filed Augu s t 28, 1981 s hot<tinq tax due in the a mount of ?4,754,.3.'5.3.00 (E ..,:: h. G). P4 .� Stf... .� f..8f...� OO and Ta x Credit i'femo of P2.'57,.398.00 made in the 1 s t quarter and mentioned above, re s ulting in a refundable amount of P19,731.00 � .Jrd q rar ter ret�urn filed on November 20, 1981 s hoN.inq tax due totalling P2,7 17,613.00, cumulative 4 8ti

DECISION CTA CASE HO. 3609 ���- 4 ���- (Exh. f{). As at that date, petitioner had already p a id .� a :::.� s t a ted abo ~~ e , P4,516,686.00 cash and P2 5 7 ,398.00 tax c redit, leaving a refundable amount of P2,056,471.00. On April 15, 1982, petitioner filed its annual in c ome ta x return (Exh. EJ s hoNing� that it suffered a loss of P912,636 . 00 or zero income tax return for Since .it� h ad __ paid, as stated above. oo P4 .� 516 .� f...Bt.� c a :.:;h and P:257,.3'.~8.r}O t� ax credit .� i t Za Na s e n t . i t� l e d refundable amount o"f P4,774,084.00 corre s ponding to year 1981. A.�:: of April .t 5 .� .1982 .� petitioner a lread y di ::::c o~' ered .. 1at i t had erroneously paid the sum of P3,70f...,77.5.00 in i �t�s .t�:~so .income ta .l\� return (see Exh. 13 �-4). It there1"ore refle c h:~d this amount in it s 198.1 In c ome Ta x Return (�xh. EJ to s hoN a total refundabl e amou nt of PS,4S0,859 . 00. On April 7 .� .t�:~83, petit.ioner filed i t s c.laim dated Narc:h 25, 1:"~83 "for the reftwdltax credit of the tot-al o �f P8,430,8.59.00 AJ repre s enting exce s s income ta x payments for the year s 1980 and 1981. But no soo n er than the c laim could be acted upon by t he respondent Commissioner

DECISION CTA CASE NO. 3609 �c-' o 'f .lr'lternal R e ~'enue .� petitioner e.levated the s ame to thi s Court on April 11, 1983. I t ma y s uffi c e to s tate that there appear s no b r:u: .ic d.i :;: aqreement a :::; b'.l th e 'fa c t ::: . Tl1e partie s havinq agreed to s ubmit the ca s e for decision based on th e p.l ea d.inq s and re�: ord after petitioner ha s pre se nted .it s evidence. The c a s e at bar pre s ent s for our determination th e s o.l e .i ss u e of whether petition e r i s entitled to th e refund of an a.l.leged erroneous and/or overpaid .in c ome t axe s 'for the year s 1980 and 1981. Pe titioner point s out to the di s crepan c y of an " a ddition a l incom e t ax for a cc elerated depre c iation on fu.l.ly d e pr ec iated a ss et s " whi L' h was t�ra ce d to t-h e " mi :.,: i' a k e in a dding b ac k in 1 '.~ 8 0 the amount o17 B - 4) a s additional tax due, thu s r e s ulting in a n overpayment- of the income ta x by s aid amount." ({. s .n., pp. 5 -- 6. CTA r ec ord :.;: ) . The re c ord :.;: 017 t�he c a ::; e does indicate r es rJo nd e nt ': o17 f.i ce .inl.' e s t.igat� ion lending currency to the c laim. thu s, The c.: .laim for .1980 tax refund by the At�las Con :.::; o.l idat�ed N.ininq and l.Jevelopment Corporation s t emmed from the erroneous addi t ion to the final .in c ome ta.;;� payab.l e .in the amount o �( P3,70f:.�..� /7.'5.00. In April� 19tH, Nr. Erne :-sto A.

DECISIOH CTA CASE HO. 3609 -- 6 - A�, c heta~ the then Chief Accountant of the corporation rec ommended that the accelerated deprec iation Nas overstated in the amount of P7 ~266~9.38.17 computed as follm<~s : Normal deprec iation for PTJ~ .J46~.J.J.J.07 .Jrd quarter 1980 _.2..1:J_(fl..?.L:"J..'l1.~.J..Q Less : Normal depreciation on asset�::: depreciated on accelerated basis ( 112 of P48~ 1.58~ 789 .80) Normal depreciation of p 9~ 266.~9.38.17 fully deprec iated assets on accelerated �- --�--�--�--�-�-1!?Z._ b.'ii:.:; i s :;::~"~":,t;.!:::�: .:.:Z.Z~:;; In come tax rate Ajdit ional In come Ta.).;� A:.:; a re s ult of thi s addition~ the final income tax payable for 1':~80 Nas increased fr o m P8~.J.51,2.57._; t(., P12,0.581 0.J2. - and over payment of P-3~ 706, 77.5 . - (plea s e s ee attac hed :x:erox c opies of quarterly me mo.s of Cebu Offi ce to 11akat i Offi c e of accelerate depreciation of fixed as:..:;ets). The t aking up of the accelerated depreciation or: fully deprec iated assets for the .Jrd quarter of 1980 i s erroneous bec aus e the deprec iat-ion on �fully depreciated as.set.s of 1980 .in the amount o'f P.J.5,614,S:~O �.J7 already includes the .Jrd quarter deprec iation of P.~ 1 266,9.J8.17. (7th Indor s ement dated September .JO, 1986, Chief Revenue Enfor cement Offic e to Chief J.lgr iculture �~ Na tural Res ources Division) (Exh . P~ petitioner) On the petitioner �s clai med overpayment of in c ome tax for 1 981 cons~ quenced by nan income tax 1 i abi 1 i ty of zero on said year as against actual in c ome tax payments totalling P4~774,084.00" the s ame may be s aid to have its affirmance in the

DECISION CTA CASE NO. 3609 7- report of finding s of respondent 's offi c e, "With re s pe c t to the claim for refund for the year 1981, thi s Offi c ha s pre~1 .iou s ly re c ommended tl?e refund of the t o t a l amount of P4, 7 74,084.0CJ a s c ontained in our 4th indor s ement dated November 11, 1985," and, " re c ommended that the aggregate amount of P8,480,859.00 repre s enting c laim s for refund of <H' e r p a i d i n c om e ta x e s c or r e s p on d i n g to the year s 1980 CP3, 7 06,775 .00) and 1981 CP4,480 1 084.00J be refunde d t o Atla s Con s olidated Hining & Development Corporation. " (8th Indor s ement dated Oc tober 1, Chief , Agri c ulture & Na tura .I Res our ce:.=; Divi s ion to Chiet� , Litigation Di~1 i s ion, Legal Offi ce ). r Ex h. Q, petitioner). A:.=; thu s s hown, th e report it se l f furni s he s the be :.=; t me a n s of it :.=; oNn e x po s ition . The fa c tual - .:. f inding :.=; a r e not s hort of s pe c ifi c s upport in term s of tra c t a ble data and rele~ant re c ord s openly laid and fully di s clo s ed, a s s u c h de s erve s the credence n o rmally ac corded in the ab s ence of c ontrary evide n c e. Upon the re c ords both the circum s tan c e s obtaining and rele~'ant legal s tandard s c ompel the c on c lu s i o n that petitioner ha s proved entitlement to a f avorable determination.

DECISION CTA CASE NO. 3609 - 8- UHEREFORE, the refund/tax credit of the aforesaid a�ount of overpaid inco�e taxes for the years involved is hereby granted. No costs. SO ORDERED. Quezon City~ Hetro Hanila, July 29~ 1988. ~- Associate Judge UE CO~�~.DJ AHANTEF-;R Presidjng Judge / (/ci&~ :___-~ CONSTANTB C. ROAQUIH Associate Judge CERT I FI CAT I 0 H I hereby certify that this decision reached after due consultation among . the member s of the Court of Tax Appeal s in accordance with Section 13~ Arti cle VIII of the Constitution. AHAHT Presiding Judge Court of Tax Appeals

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