CTA Case No. 3860 (Decision)

J REPUBLIC OF THE ~HILIPPINIS COURT OF TAX APPEALS QUKZON CITY DEVELOPMENT BANK OF THE PHILIPPINES, Petitioner~ -� ..... ve ,~ :,. u r:-,~ C.T.A. CASE NO. 3860 THE COMMISSIONER OF INTERNAL REVENUE, Res pondent. >: - - -- -- - - - -- - - - - >: DEC I I DN Th.i. s cast.~ .?.ro se from a petition filed by the De ve l o pm e nt Bank of the Philippines~ petitioner her-f.�?in~ �for the n ?fund o �f P9.1 ~ 81.7. 68 paid to t.he Bureau of Inte rnal Revenue repres enting the amount o �f ta >: l��d . thh f:'? ld on inter-est remittee! to ft."lr.. eign b a nk !":. . On the bac;:-i s the pleadings filed~ res p o ndent. Commi ssi nner.. of Internal Revenue~ s ubm it ted thi s case for- dec i sian. No memorandum wa s filed b y both parties. The fact s of this case are simple. Petitioner� bank is a government-controlled corporation organized and existing under and by v ir-tue of Philippine laws. Sometime on October 25, .198 2 ~ pE~ti tioner paid the Inter-nal

DECISION CTA CASE NO. 3860 - 2- F:evenue the total amount of P14~063,400.65 as withholding taxes due on interest remitted to var .i.ous foreign creditors for the account o�f its numer-ous bor-r-oi-'Jer-c 1 ien ts on their gl.tar-anteed foreign obligations. the total amount of P14,063 ,400.65 1-'lit.hholding paid to the Bureau~ the amount of P91~817.68 represents the 10% tr:~>: t-l.i thheld on inter�e~;t payments due on for�eign c ur-rene y loan tr-ansac: tion by one of its c 1 ients ~ i.e.~ Sta. Ines Melale Forest Products Corporation with Banque Nationale de Paris. Pet.i tioner con tends that at the time it paid the \1-J.ithholding ta >: of P14~063~400.65 i t had no knowledge that Sta. Ines Malale Forest Products Corpor-,"'t.ion had a 1 r�eady paid on October 22, 1982 the P91,817.68 tax corresponding to the firm's interes ts remitted to Banque Nationale de Paris. Inas much as there has been overpayment on account o f the double remittance of P91,817.68, �f Jrst, by Sta. Ines Malale .Forest Products Corporation and, second, by petitioner, the course of action pursued by petitioner was to file a claim for ta x credit with the Bureau of Internal Revenue He<:1d O�ffice. l,oJ:i.thout t-Jaiting for the decision of

DECISION CTA CASE NO. 3860 - 3- r�espondent ~ pet.i t.ioner filed the instant petition for n?viet.-J �;;o as not to be bar-red by reason o �f pre s cr�iption. The issue addr-essed to this Court is whether petitioner ha s pr-oven a va 1 id c 1 aim to the refund of alleged erroneously paid lOX withholding tax on interests remitted to foreign bank in the amount of F'91~8.17.68. ~'-li thout going over the actual merits of this case~ We are faced with the dilemma of dismissing the pet i t.icm P.r.!!_P.! _Q for lack of jurisdiction. Our jurisdiction is defeated by the r-ecent. promul ga t.i.on of the Supreme Court in the case of Development Bank of the Philippines vs. The Court o �f Appeals and the Commissioner of Customs~ G .FL No. December 1.989~ t.-Jhich affirmed the deci s ion of the Court of Appeals in that case~ where it was held that the Court of Tax Appeals has no jurisdiction to take cognizance of the case following the explicit mandate of Section 1 of P resi dential Decree No. 242~ which provides: SECTION 1. p,~ovisions of law to the contrary notwithstanding~ all disputes~ claims and controversies solely between or among the departments, bureaus~ offices~ agencies and instrumentalities of the National Government~ including government-owned or cclntr�� olled c:orporatlons but e>:c:ludinq

DECISION CTA CASE NO. 3860 - 4- constitutiona l of fices or agencies~ arising from the interpretation and applicatio n of s tatutes~ contracts or agreements~ sha ll henceforth be administratively sett led or adjudicated as provided hereinafter: Provided, That this ~;; h a ll not apply to cases already pending in court at the time of the effectivity of this decree. Tho sE? cases fa 11 ing under Section 1 sha 11 be t ~. ubmi tE~ d for adj ud ic at: ion pursu a nt to the provi sions under Sections 2 and 3 of said Decree eit h er to the Secretary of ~Justice :i. f the dispute invol ves only questions of law or to the Solicitor Genera 1 ~ Government Corporate Counsel or the Secretary of Ju!':.t :i.ce in cases involving mixed questi o ns of 1 C:\1-'1 and of f ac t or only factual Cons.ider-�Jnq that. the provi~dons of P.D. 242 1-'J h .i.c h took effect on the date of its promulgation on ,July 9 ~ 19 T3 are t-epug n a nt I�Ji th Section 7 of Republ :i.e Act No. 1.125 providing for the jurisdiction of the Court of Ta x Appeals (eff. June .16~ 1954) ~ then thi s later enactment in effect amended the jur-i sd ic tion of this court as it was provided in Section 1 of P.D. 242 - "Provisions of 1aw to the contrary notwi thstanc.Hng". Thus~ as this case involves a claim by DBP~ a govern me nt and controlled corporation~

DECISION CTA CASE NO. 3860 - 5- a gain s t the Commissioner of Internal Revenue~ both partie s r�epresenting only one interest the Gover�nment ~ then the procedure to be applied in a djud.i. c.-'.\ t:.ing s uch claim 1-'muld be that embodied in F'.D. 2 4 2 . vii th the ci.rcumstances now obtaining and in vievJ o �f the t-ecent pronouncement of the Supreme Court~ suffice it~ therefcJre, to state that i.t is beyond the ambit of this Court's jurisdiction to t ake cogni zance of the instant petition. As ruled by th e High Court~ We mu s t obey. Nothing more is to be done except to DISMISS this case for lack of jur� i~::. diction v1.ithout pr�ejudice to the filing of a petition with the Secretary of Justice~ as i t s prop er� �forum. WHEREFORE, the petition for review is hereby DISMISSED without pronouncement as to costs. SO ORDERED. Que zo n City~ Metro Manila~ November 29~ 1990. - ~� in;R~~~~~t/ Juclge

DECISION - CTA CASE NO. 3860 - 6- CERTIFICATION I here by certify that this decision was reached after due consultation between the members of the Court of Tax Appeal s in accordance with Section 13~ Article VIII of the Con~titution. ~ Presiding JL1dge Court of Tax Appeals