STAGES PRODUCTION SPECIALISTS, INC. v. COMMISSIONER OF INTERNAL REVENUE

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY ENBANC STAGES PRODUCTION CTA EB NO. 2658 SPECIALISTS, INC. (CTA Case No . 9817) Petitioner, Present: DEL ROSARIO , P.J ., RINGPIS -LIBAN , MANAHAN , -versus- BACORRO-VILLENA, MODESTO-SAN PEDRO , REYES-FAJARDO , CUI-DAVID, FERRER-FLORES , and. ANGELES, JJ. COMMISSIONER OF INTERNAL REVENUE, Promulgated: Respondent. ){- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - DECISION CUI-DAVID, J. : Before the Court En Bane is a Petition for Review filed by Stages Production Specialist, Inc. ("Petitioner"), 1 under Section 3(b) , Rule 8 ,2 in relation to Section 2(a)(l) , Rule 4 3 of the Revised Rules of the Court of T~ Appeals ("RRCTA").4 It seeks the r eversal of the Court 's First Division ("Court in Division") v 1 Petition for Review, dated July 14, 2022, received by the Court on July 18, 2022; EB Docket, pp. 1- 11. 2 Section 3. Who May Appeal; Period to File Petition.- (a) x x (b) A party adversely affected by a decision or resolution of a Division of the Court on a motion for reconsideration or new trial may appeal to the Court by fi ling before it a petition for review within fifteen days from receipt of a copy of the questioned decision or resolution. Upon proper motion and the payment of the fu ll amount of the docket and o ther lawful fees and deposit for costs before the expiration of the reglementary period herein fixed, the Court may grant an additional period not exceeding fifteen days from the expiration of the original period within which to file the petition for review. 3 Section 2. Cases Within the Jurisdiction ofthe Court En Bane. - The Court En Bane shall exercise exclusive appellate jurisdiction to review by appeal the fo llowing: (a) Decisions or resolut ions on motion~ for reconsideration or ncv< trial of the Court in Divisions in the exercise of its exclusive appellate jurisdiction over: ( I ) Cases arising from administrative agencies - Bureau of Internal Revenue, Bureau of Customs, Department of Finance, Department of Trade and Industry, Department of Agriculture. 4 A.M. No. 05-11-07-CTA.

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 2 of24 x------------------------------------------------------------------------------------------x Decision dated August 31, 2021 ("assailed Decision"), 5 and Resolution dated June 17, 2022 ("assailed Resolution"),6 in CTA Case No. 9817 entitled Stages Production Specialists, Inc. vs. Commissioner ofInternal Revenue. THE PARTIES Petitioner Stages Production Specialists, Inc. is a domestic corporation with business address at 606 Greenbelt Mansion, 106 Perea St., Legaspi Village, Makati. It is engaged in the business of entertainment, promotion, and advertising, such as but not limited to the packaging of total entertainment concepts, from idea stage to show time and management of talents and artists required in the production of shows locally and internationally. It is a registered taxpayer in the Bureau of Internal Revenue ("BIR") Revenue District Office No. 47 with Tax Identification Number 200-417-566-000.7 Respondent, on the other hand, is the Commissioner of Internal Revenue ("CIR"), with the power to decide disputed assessments, refunds of internal revenue taxes, fees or other charges, penalties imposed in relation thereto, or other matters arising under the National Internal Revenue Code ("NIRC" or "Tax Code"), or other laws or portions thereof administered by the BIR. He holds office at the BIR National Office Building, Agham Road, Diliman, Quezon City. THE FACTS The facts, as found by the Court in Division, are as follows: 8 On April 6, 2018, petitioner filed with the BIR an administrative claim for refund through an Application for Tax Credits/ Refunds (BIR Form No. 1914) and the letter dated April 4, 2018, requesting for the refund or the issuance of a tax credit certificate (TCC) in the amount of P3,585,949.00, allegedly representing excess income tax payments for TY 2015. ~ 5 EB Docket, pp. 16-27; penned by Associate Justice Catherine T. Manahan, with Concurring Opinion from Presiding Justice Roman G. Del Rosario. 6 /d., pp. 33-40. 7 Par. Il(A)(4), Summary of Admitted Facts, Pre-Trial Order dated July 26, 2019, Division Docket -Vol. I, p. 514. 8 Annex "A," Petition for Review, EB Docket, pp. 16-27.

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 3 of24 x------------------------------------------------------------------------------------------x Petitioner then filed the instant Petition for Review with this Court on April 16, 2018 which was originally raffled to the Second Division. On July 6, 2018, respondent posted his Answer to the Petition for Review. The Pre-Trial Conference was initially set on August 30, 2018. However, in view of the absence of respondent's counsel and without objection from petitioner's counsel, the Pre-Trial Conference was reset to October 11, 2018. In the meantime, respondent's Pre-Trial Brief was posted on August 11, 2018, while petitioner's Pre-Trial Brief was posted on August 24, 2018. Pursuant to the Order dated September 24, 2018, the instant case was transferred to this Court's First Division. Correspondingly, the Pre-Trial Conference was again reset to January 31, 2019 by the said Division. However, the same was ultimately reset to and was held on April 4, 20 19. The Court then issued the Pre-Trial Order dated July 26, 2019, and deemed the pre-trial terminated. During trial, petitioner presented documentary and testimonial evidence. As part of its testimonial evidence, petitioner offered the testimonies of the following individuals, namely: (1) Ms. Evangeline G. Agustin, petitioner's accountant; and (2) Ms. Michele Lacsamana, petitioner's Accounting Assistant. Petitioner then filed its Offer of Exhibits on December 4, 2019. Respondent failed to comment thereon. In the Resolution dated June 3, 2020, the Court admitted petitioner's exhibits, except for Exhibits "P-10-1", "P- 10-m", "P-10-u", "P-10-v", "P-10-ii", "P-10-xx", "P-10-bbb", "P- 10-ccc", "P-10-eee", "P-10-fff', "P-10-iii", "P-10-mmm", "P-10- nnn", "P-10-ppp", "P-10-sss", "P-10-aaaa", "P-10-bbbb", "P- 10-cccc", "P-10-dddd", "P-10-eeee", "P-10-ffff, "P-10-gggg", "P- 10-llll", "P-10-nnnn", "P-10-oooo", "P-10-pppp", "P-10-qqqq", "P-10-wwww", "P-10-yyyy", "P-10-zzzz", "P-10-ddddd", "P-10- hhhhh", "P-10-iiiii", "P-10-jjjjj", "P-10-mmmmm", and "P-10- ooooo", for failure to present the originals for comparison. On the other hand, respondent, through counsel, manifested that he will no longer present any evidence. The Memorandum of respondent was posted on July 30, 2020, while petitioner's Memorandum was posted on August 19, 2020. ~

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 4 of24 x------------------------------------------------------------------------------------------x On September 16, 2020, this case was submitted for decision. On August 31, 2021, the Court in Division promulgated a Decision9 denying petitioner's Petition for Review, the dispositive portion of which reads: WHEREFORE, in view of the foregoing, the instant Petition for Review filed by petitioner on April 16, 2018 is DENIED for lack of merit. SO ORDERED. On October 27, 2021, petitioner filed a Motion for Reconsideration, 1� to which respondent filed his Comment/ Opposition (on Petitioner's Motion for Reconsideration), 11 posted on February 21, 2022. Petitioner filed its Reply on March 4, 2022. On June 17, 2022, the Court in Division denied petitioner's Motion for Reconsideration. The dispositive portion of the Resolution12 reads: WHEREFORE, premises considered, petitioner's Motion for Reconsideration filed on October 27, 2021, is DENIED for lack of merit. SO ORDERED. PROCEEDINGS BEFORE THE COURT EN BANC Petitioner filed a Petition for Review13 on July 18, 2022. Following the Court's Minute Resolution dated September 14, 2022, 14 petitioner filed a Compliance 1s submitting the original copy of the Verification and Certification on Non-Forum Shopping on September 27, 2022. Respondent filed his Comment/ Opposition (on Petition for Reviewj,16 posted on September 30, 2022. 9 Supra at note 5. ~ 10 Division Docket, Vol. II, pp. 1365-1370. 11 /d., pp. 1386-1390. 12 Supra at note 6. 13 Supra at note I. t4 EB Docket, p. 465. IS fd., p. 466. 16 /d., pp. 470-475.

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 5 of24 x------------------------------------------------------------------------------------------x The case was submitted for decision on November 2, 2022.17 ISSUES Petitioner forwards the sole issue as follows: WHETHER PETITIONER IS ENTITLED TO A REFUND OF EXCESS INCOME TAX PAYMENTS AMOUNTING TO THREE MILLION FIVE HUNDRED EIGHTY-FIVE THOUSAND NINE HUNDRED FORTY-NINE PESOS (P3,585,949). PETITIONER'S ARGUMENTS Petitioner contends that all the requirements for entitlement to a tax refund have been duly proven. 18 It further contends that the claim for refund was filed within the two-year reglementary period, the income payments received by petitioner were declared [as] part of its gross income, and that the fact of withholding was established by petitioner when it submitted the certificates of creditable taxes withheld. 19 It argues that the Tax Code and jurisprudence do not require the submission of proof of the prior year's excess credits.20 Petitioner also argues that its annual income tax return ("ITR") for the taxable year ("TY") 2015 shows under Item No. 20 the total overpayment ofP10,152,147.00 and under Item No. 21 that it has opted for a tax refund. However, it alleges that contrary to the assailed Decision and Resolution, the "To be refunded" portion pertains only to P3,585,949.00 out ofthe total overpayment of P10,152,147.00 or the total creditable withholding taxes ("CWT") for 20 15. It "understands that since it already exercised the carry-over option for the balance of prior years excess credits of P6,566, 198.00, it can no longer be refunded." Thus, petitioner concludes that the presentation of additional evidence to prove the supposed total credits amounting to P8,488,552.00 has no use or purpose. ~ 17 /d., pp. 479-480. 18 Petition for Review, p. 5. 19 !d., p. 6. 20 /d., p. 7.

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 6 of24 x------------------------------------------------------------------------------------------x Petitioner questions the finding of the Court in Division as to the amount of the prior year's excess credits that was carried over to TY 2016. It avers that the excess CWT ofP3,585,949.00 was not carried over in 2016 and that there is no more income tax due ofP258,759.00 forTY 2015.21 RESPONDENT'S COUNTER-ARGUMENTS Quoting the ruling of the Court in Division, respondent alleges that petitioner exercised the carry-over option instead of a refund. Thus, according to respondent, a portion of petitioner's CWT was already carried over and can no longer be refunded.22 Respondent further avers that petitioner failed to substantiate that it has excess tax credits for TY 2015. 23 Respondent ends his argument by stating that tax refunds are in the nature of tax exemptions, and hence, these must be construed strictly against the taxpayer.24 THE COURT EN BANC's RULING The instant Petition is not impressed with merit. The Court En Bane has jurisdiction over the instant Petition. Before We proceed to the merits of the case, We shall first determine whether the present Petition was timely filed. On June 17, 2022, the Court in Division denied petitioner's Motion for Reconsideration through a Resolution, which petitioner received on July 1, 2022. Under Section 3(b), Rule 825 of RRCTA, petitioner had fifteen (15) days from receipt of the said Resolution, or until July 18, 2022,26 to file a Petition for Review before the Court En Bane. On July 18, 2022, petitioner timely filed the instant v Petitionfor Review.27 21 !d., p. 9. 22 CommentJOpposition, p. I. 21 !d., p. 3. 24 !d., p. 4. 25 Supra at note 2. 26 The 151h day falls on July 16,2022, which is a Saturday. Accordingly, the next working day is on July 18,2022. 27 !d., pp. 6-46.

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Page 7 of24 Specialists, Inc. vs. Commissioner of Internal Revenue x------------------------------------------------------------------------------------------x Having settled that the Petition was timely filed, We likewise rule that the Court E n Bane has jurisdicti on to take cognizance of this case under Section 2(a)(l), Rule 42s of the RRCTA. We now discuss the merits. Petitioner's compliance with the requirements of Section 76 of the NIRC of 1997, as amended. of Relevant to the resolution of the instant case is Section 76 the NIRC of 1997, as amended, viz.: tttpacoharodexertjchupcpeeosoadtrrStmyiaponEtmoeitgCoarneacnl.tntatirtlloaseie7nxatnmb6udsdl.rhaeaundaretleFcoolooirdennvtiufataeitrhxsrlhiceinenarug:gleAnytndthdetheeijaerrures.stSattoIieamftdcxatetalthinaboetxtlaneasxbuia2nRlmb7ecleoeystomuehfiaranetnrlchlo.oiesfmfiqtnlhee-uoaatfatoreEytrqfeveiutrneahlararyey,ll (A) Pay the balance of tax still due; or (B) Carry-over the excess credit; or (C) Be credited or paid, as the case may be. refunded with the excess amount it[bfaqsmprEshoupeeuasrmaafecpuaiuytdnctlprayhnet,hnteemedabtatcrIdhhxeslneatiyeeaoaednbofxscceeieglfnaaax,xetabcsrathccnarseoleeepiexutdmsesaeatcssdequxrhebhiaxnuqeloctmeodcauodarveecraexpyoteosrrdateeusrtslirinraeiocnptasrrdonaotebcslrnyors.seiiaslnnhfdtriiOhtitogtontiimiaohfnwcecslianecsoalcrunpeematpfbspiedotopsuteeelridnhlicticteseetecciahahdnqtdoexstoeatue.nii]ploafdasattlitlganiigrniednbxtoaaadeegeafinlironrnbataeltrstsloaydldoettlxcjoiauaqcianiwtrbnasushcrettrlhceoaeamedrvormyxtoyremt-eeeehocnecsrfeeavartttsurbaieerremnoxlsdrtefedafitoaadhtxuttrfnuahoeoeerodensed.rrsr ~ 28 Section 2. Cases Within the Jurisdiction ofthe Court En Bane.- The Court En Bane shall exercise exclusive appellate jurisdiction to review by appeal the follmving: (a) Decisions or resolutions on motions for reconsideration or new trial of the Court in Divisions in the exercise of its exclusive appellate jurisdiction over: (I) Cases arising from administrative agencies - Bureau of Internal Revenue, Bureau of Customs, Department of Finance, Department of Trade and Industl)', Department of Agriculture.

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 8 of24 x------------------------------------------------------------------------------------------x Under the above provision, there are two options available to a corporation whenever it overpays its income tax for the taxable year: (1) to carry over and apply the overpayment as tax credit against the estimated quarterly income tax liabilities of the succeeding taxable years until fully utilized, and (2) to apply for a cash refund or issuance of a tax credit certificate within the prescribed period.29 Such overpayment of income tax is usually occasioned by the over-withholding of taxes on the income payments to the corporate taxpayer. 3D In exercising its option, the corporation must signify in its annual corporate adjustment return its intention to carry over the excess credit or to claim a refund or tax credit, by marking the option box provided in the BIR form. 31 To facilitate tax collection, the two options are alternative and not cumulative, that is, the choice of one precludes the other.32 As Section 76 of the NIRC of 1997, as amended, unequivocally provides, once the carry-over option is made, actually or constructively, it becomes forever irrevocable regardless of whether the excess tax credits were actually or fully utilized. No application for a tax refund or issuance of a tax credit certificate shall then be allowed. 33 Petitioner can only take comfort in the assurance that the amount will not be forfeited in favor of the government but will remain in its account, to be carried over in the succeeding taxable years, creditable against utilized. 34 its future income tax liabilities until fully ~ 29University Physicians Services, Inc.-Management, Inc. v. Commissioner ofInternal Revenue, G.R. No. 205955, March 7, 2018. 30 !d. 31 Systra Philippines, Inc. vs. Commissioner ofInternal Revenue, G.R. No. 176290, September 21, 2007. 11, 32 Republic vs. Team (Phi/s.) Energy Corp., G.R. No. 188016, January 14.2015,750 PHIL 700-723. 33 United International Pictures AB v. Commissioner ofInternal Revenue, G.R. No. 168331, October SCRA 23; Commissioner ofInternal Revenue v. PL Management International 2012, 684 (20 I 1); Belle C01poration v. Commissioner ofInternal Revenue, 654 Phil. I02 Revenue v. The Philippine American Life and General Insurance Co., 646 Phil. 161 Philippines, Inc., 662 Phil. 43 I Commissioner ofInternal Revenue, 560 Phil. 261 (2007). (20 I I); Commissioner ofInternal (2010); Systra Philippines, Inc. v. 34 Axia Power Holdings Philippines Corp. v. Commissioner ofInternal Revenue, G.R. No. 230847 (Notice), October 14, 2020, citing the case of Systra Philippines, Inc. v. Commissioner ofInternal Revenue. 560 Phil. 261,274 (2007).

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Page 9 of24 Specialists, Inc. vs. Commissioner of Internal Revenue x------------------------------------------------------------------------------------------x 2 0 15 Here, a perusal of petitioner's Amended Annual ITR for TY or Final Adjustment Return ("FAR") reveals the following: Total Income Tax Due(Overpayment) 1'1,922,354.00 Less: Total Tax Credits/Payments 1'8,488,552.00 12,074,501.00 Prior Year's Excess Credits Other Than 3,585,949.00 Pl0,152,147.00 MCIT Creditable Tax Withheld from Previous 1'2,540,234.00 Quarter/a per BIR Form 2307 1,045,715.00 Creditable Tax Withheld for the 4th Quarter per BIR Form 2307 TOTAL AMOUNT PAYABLE (Overpayment) In Part II, Item No. 21 of petitioner's 2015 Amended Annual ITR,35 petitioner ticked the box "To Be Refunded," viz.: 20 TOTAL AMOUNT PAYABLE (Overpayment) (P10,152,147) 21 If Ove.IJJayii!_ent, mark "X" on one box only. jgJ To be Refunded 0 To be issued a tax credit certificate 0 To be carried over as tax credit next yearI quarter CWTsPuetnidtieorneSreicntidoinca7t6edoifttshcehNoiIRceCtoofb1e9r9e7f,uansdeadmoefnidtesde.xcess CnthoreetrdeaibHtislsoeownftoePov8eep,vr4r,io8dvt8ehe,n5eci5teCs2.poe0run0ert.sti3et6ilnnetmeDdeinvttiostipoornoavrrueelfietudsndPth,riacotor pnYeseitdiateri'orsinnEegrxctwheasasst rseuibtemrPiastesetisiotintohnoaeftrptarhosesoaTfioalsfxPtChrieoodfreiYnadeniandrgsjsEuorxficstephsresuCdCeorneudcritetisdn. 3o7Dnivoitsiroenquainrde c2tposteaprorh0uruvrnreie1ebildodpdiqs5jnrieceeeut,gtrntcsynAeiweh,ctteotsfdieaehattdfooiietritftefnoirc'schoossenthocrephnrpeTero'iaedCserxtYnloeerlcrostfeosete2iautpghfdfhspi0freouenseeeet1dnnrritic4niidtodntntrorghipiaeugnfDcoepndttlgniithooaidevthetifrsxsimrCeTputsi'uYrsiAWols.poinntfoFnnea2Tie2Prtn,rn0us0yt8yctsu1ric1h,eetega4e44heasailor8ev'rtnCAfa8siraeadft,n,,nonnrih5icdgrudnes5teeaurou2xtsnpstmQae.iparohE0ssliuoietit,o0ndmenaanir.nnrBnatpd.tsycHdndreaeeeiidnraenFosalQtnepryuordenosefuyrfiintIedntaenhaThpvtsradreneRetaerteserrot'brhss,irttltenlrhreeihfyeoooeoxaaefsbltrnubcItaijTednetottetThreRehiscvcY'ddsedseeets 35 Exhibit "P-I", Division Docket, Vol. II, p. 1054. ~ 36 Assailed Decision, pp. 9 and I t. 37 Petition for Review, CTA EB No. 2658, p. 7.

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 10 of24 x------------------------------------------------------------------------------------------x not present any evidence, testimonial or documentary, to disprove the existence of the same. Respondent's failure to object to the evidence offered by petitioner rendered the same admissible, and this Court cannot, on its own, ignore such uncontested evidence. More, Section 76 of the NIRC of 1997, as amended, and the other requisites for claiming a refund of excess or unutilized CWT do not require substantiation of prior years' excess credits. The Court in Division likewise ruled that part of petitioner's refund claim in the amount of P1,922,354.00 was carried over to the succeeding taxable period; 38 hence, it is precluded from refunding the same. Petitioner argues that the amount carried over in TY 2016 is the same amount declared in its Amended Annual ITR forTY 2015 as the "Prior Year's Excess Credits Other Than MCIT," leaving behind its 2015 excess CWTs of P3,585,949.00, which petitioner claimed to be a proper subject of a refund claim. After taking a second hard look at the parties' arguments and the evidence admitted relative to the finding of the Court in Division that "part of the claimed CWT for the calendar year 2015 in the amount of P1,922,354.00 was carried over to the succeeding taxable period," the Court En Bancis convinced that the amount ofP3,585,949.00, representing the excess CWTs for TY 2015, has not been carried over to the succeeding TY 2016. Records reveal that petitioner filed its 2015 Amended Annual ITR39 reflecting an overpayment of P10,152,147.00, after deducting the Total Income Tax Due for TY 20 15 of P1,922,354.00.40 In the following year, petitioner filed its 2016 Amended Quarterly ITR for the First Quarter, 2016 Amended Quarterly ITR for the Second Quarter, and 2016 Original or Unamended Quarterly ITR for the Third Quarter, all reflecting the amount ofP6,566,197.56 as its Prior Year's Excess Credits under Item No. 31A of the quarterly returns. Petitioner's 2016 Amended Annual ITR also declared the amount of P6,566, 198.00 as its Prior Year's Excess Credits. As discussed, petitioner had an overpayment of P10,152,147.00, net of the income tax due, forTY 2015, but it carried over to TY 2016 only P6,566,198.00, leaving the amount ofP3,585,949.00. 38 Assailed Decision, p. I0. ~ 39 Exhibit "P-1", Division Docket- Vol. II, pp. 1054-1061. 40 Supra at note 35.

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Page 11 of24 Specialists, Inc. vs. Commissioner oflnternal Revenue x------------------------------------------------------------------------------------------x ipcPtae3crt,oir5timi8eoI5dpnn,ld9eoieerv4ese9udr.wn,0tdio0tte,hhtrhetsSehueeesbxcujocteicetocchsnteseer7oCd6rfiWenoqtgThfusteTihrYfeepom2rrNe0eITs1nRYe6tCns ,a2ton0afcds11a5d9sme9iisa,7ncy,uhtabsahsesveeaerdemafmnbeuoennoltdoduewenbddet. ,etoionff Petitioner's compliance with the other requirements or requisites for a claim for refund of excess or unutilized CWTs. Sections 204(C) and 229 of the NIRC of 1997, as amended, state: SEC. 204. Authority of the Commissioner to Compromise, Abate, and Refund or Credit Taxes. - The Commissioner may - wrpcuNurvgreelenaonaroatdciloylfuitueeeimdtmcrtieseenvrfsmneeecofo(fdnCdootrcifhilr)tonluetieaorddnsociroCiemttrcftseraepirhharoxtedefanonrhnodpinenawtdreiaafgltyuicblorenttrreneyriaoegerefduvrxdursaftneeinihontolunrfideefmeuroussofnteretpvuphpiaddroneneeusxesrdniterwfspweracuastdamivahrnlttyitamoaadhwtpymlixsr.iu:snpieneeetgsprswhPn,eutowtrthnwophuesaieavohrtatonnlhirnattddoailt(e,teunhpl2hhdstear)behe,iooveynosoyuheChrcfeoasihaoobolawrtyliymneefrlse,sedsmvrinboerededaieserrteisrtfu,fsrsretucaeriuieTnllnrnodlcrldehedneotteagaidewitorasottrheehlnnilaeaaddney., ppwbaowohcCernerroeroioneoytruiclchannenlroeelaosgttlaecufuyldfdnSttefumt,ueeoicyEldanlrroltyCyeu.mgara-tdtl.lhshlacfl,Nmeeuieono2logogemlarn2reledriyese9edtdochyurc.wftt,boiatowetoaeiovRsdtrnhoefh,eohbayrmarcnayevunotgvppaeenhyvforeineteeunbofnisrllptbceuaylaaeeCaeylmainentienoycdoydnemecoaficudlrnllnemallrlTn,geexaaoidimacgictnwssmixteeeseohedshrieodfnasoEoedputlianwortvlrrslhtereolihboreoryltiteea;yhnrnehofvotseumaobreoetuonvrruiraotublnedtliirsaeaennnbluegdlosotyentaauaurthrelinrceleononcyesyvxhrerrsuaceciedsmtcesnodIsy.sslhluuiila,lsetneeeiinosgtvtchansraatteaenoaexleollsddyxy,rryf ~

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Page 12 of24 Specialists, Inc. vs. Commissioner of Internal Revenue x------------------------------------------------------------------------------------------x atcshpahpluofaaeptwpyieemeemrrarevvretteItshuenrhne,rcntearnTlieennhfeaoyugoarxpfrlctcpy,oatairhnsttrueoheeasf,ewthueCinanhootovdinthmceashaoxmoubtrcfepimcsehaortsnyaweirsyomdeuoniraeitpretrno(aeri2otnnsnm)reeywaaoyplaaytutreafsy,soaxtleec,rmyvrserwepaeepndahfdgarieeiawyod,nrr.mmeigdtshelouseonntchshuthas:tetlhPlaperodbawoffaeyvartmicfiedateietelneenodoyndt,ff In the case of Commissioner of Internal Revenue v. Philippine Bank of Communications, 41 the Supreme Court enumerated the requisites for claiming a tax credit or a refund of creditable withholding tax as follows: the 1. The claim must be filed with the CIR within the two (2)-year period from the date of payment of tax; otbhfyetahpeca2oyt.apeTxyehwsoehfitofahawhcsiettnalodgtfe;tmwahneietdnhathmodoluduliynntgispsmauiueddsatbnbydetthehseetapabamlyiooshruentodt 3. It must be shown on the return that the income received was declared as part of the gross 1ncome. We examine each requisite in seriatim. First requisite: The administrative and judicial claims for refund were timely filed. oereoexfrffrpaou1innnr9yaedI9tnos7iouua,anpnscaledcyosrofvtprathedwamneaioidennfnci(g2lodei)nrcewygadiuel,iltoasehifregtsaSttihlfhselreycaocttmiclsomeouantlialhrsteyect2shat0hdera4oadit(sutCeetlia)dnaoxfaf,cbtnpeaebdarsoyemp2tmsah2ayeod9tmnfheoteerfbrneeeccttg.hfoloaaevirremedNrlyIteRfhsooCesrf C(41PohGmi.lmRip.ipsNisniooe.sn)2e1rO1op3ef4Ir8na,tteiForennbasrluCRaoreryvpe2on3rua,et2,io0Gn2.,2R,G.c.NRitio.n.Ng2o0W.6i15n82e56b7,r2eJ8na,nneOuracr&tyob2Ien8ri,g12o60,I1n25s0;u1Cr3ao.nmcemiBsrsoiokneresr, ~ Inc., v. Revenue vs. Team ofInternal

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 13 of24 x------------------------------------------------------------------------------------------x While the law provides that the two (2)-year prescriptive period in claiming a tax credit/refund is counted from the date of payment of the tax, jurisprudence clarified that the two years is reckoned from the filing of the final adjustment return or adjusted final tax return because this is where the figures of the gross receipts and deductions have been audited and adjusted, reflective of the results of the operations of a business enterprise. The case of Commissioner of Internal Revenue v. Univation Motor Philippines, Inc. (Formerly Nissan Motor Philippines, Inc.) elucidates:42 Indeed, the two-year period in filing a claim for tax refund is crucial. While the law provides that the two-year period is counted from the date of payment of the tax, jurisprudence, however, clarified that the two-year prescriptive period to claim a refund actually commences to run, at the earliest, on the date of the ruing of the adjusted final tax return because this is where the figures of the gross receipts and deductions have been audited and adjusted, reflective of the results of the operations of a business enterprise. Thus, it is only when the Adjustment Return covering the whole year is filed that the taxpayer would know whether a tax is still due or a refund can be claimed based on the adjusted and audited figures. [Emphasis supplied] As aptly found by the Court in Division, petitioner flied its Annual ITR forTY 2015 on April15, 2016. Counting two years, the administrative claim filed on April 6, 2018, and the judicial claim filed before the Court in Division on April 16, 2018,43 were within the two-year prescriptive period. Clearly, the first requisite has been satisfied. Second requisite: The fact of withholding has been established by copies of certificates ofCWT duly issued by the payors showing the amounts paid and tax withheld, but only to the extent ofP2,570,522.39. ~ 42 Commissioner ofInternal Revenue v. Philippine Ban k ofCommunications, G.R. No. 211348, February 23,2 022, citing Commissioner ofInternal Revenue v. Univation Motor Philippines, Inc. (Formerly Nissan Motor Philippines, Inc.), G.R. No. 231581, ApriliO, 2019. 43 April 15, 2018 fell on a Sunday; hence, the Petition for Review was filed on the next working day.

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 14 of24 X------------------------------------------------------------------------------------------X The second requisite mandates petitioner to prove the fact of withholding of the claimed CWTs by a copy of the statement duly issued by the payor, acting as the withholding agent, to the payee, showing the names of the payor and payee, the income payment, the amount of tax withheld, and the nature of the tax paid. In Commissioner ofInternal Revenue vs. Philippine National Bank,44 the Supreme Court held that the certificate of creditable tax withheld at source (BIR Form No. 2307) is the competent proof to establish that taxes are withheld. It is not even necessary for the person who executed and prepared the certificate of creditable tax withheld at source to be presented and to testify personally to prove the authenticity of the certificates. Thus, We proceed with the examination of the certificates and other relevant documents. To prove the fact of withholding of the CWT forTY 2015 in the amount of P3,585,949.00, petitioner presented Certificates of Creditable Tax Withheld at Source45 issued by various clients showing CWT in the aggregate amount of only P3,382,759.34, with related income payments amounting to P63,171,803.72, detailed as follows: Exhibit No. Payor's Name Amount Amount of Income of Tax Payment Withheld "P-10" 4Life Research Philippines, LLC 1'164 705.88 1'24 705.88 9,803.90 980.39 "P-10-a" ABS-CBN Corooration "P-10-a" ABS-CBN Corporation 597,407.30 59,740.73 "P-10-a" ABS-CBN Corporation 387,037.00 58,055.55 "P-10-a" ABS-CBN Corporation 583,333.40 58,333.34 "P-10-a" ABS-CBN Corporation 35 294.13 5 294.12 "P-10-a-1" ABS-CBN Corporation 11,764.73 1,764.71 "P-10-a-1" ABS-CBN Corporation 64 814.80 9,722.22 "P-10-a-1" ABS-CBN Corporation 2,599,454.93 389,918.24 "P-10-a-2" ABS-CBN Corporation "P-10-a-2" ABS-CBN Corporation 10,309.27 1 546.39 1 228,540.13 184 281.02 "P-10-a-3" ABS-CBN Corporation (1,356,317.87) (203,447.68) "P-10-b" ABS-CBN Film Productions, 23,529.41 3,529.41 Inc. 44 Commissioner ofInternal Revenue. v. Philippine National Bank, G.R. No. 180290, September 29, 2014, 744 PHIL tl 299-312. " Exhibits "P-10", "P-I 0-a" to "P-1 0-k", "P-10-n" to "P-I 0-t". "P-10-w'� to "P-1 0-hh", "P-10-.ii" to "P-1 0-ww", "P-10- yy" to "P-I 0-aaa", "P-I 0-ddd", "P-I 0-ggg", ''P-10-hhh", "P-10-jjj" to "P-I 0-111", "P-I 0-ooo", "P-I 0-qqq", "P-I 0-m", "P-I 0-ttt" to "P-1 0-zzz", "P-I 0-hhhh" to "P-I 0-kkkk", "P-I 0-mmmm", "P-I 0-rrrr" to ''P-I 0-vvvv", "P-1 0-xxxx", "P- I0-aaaaa" to "P-I 0-ccccc", "P-10-eeeee" to "P-I 0-ggggg", "P-I 0-kkkkk", "P-I 0-11111", "P-10-nnnnn", and "P-I 0- ppppp", CTA Case No. 9817, Docket- Vol. II, pp. 1120 to 1243.

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Page 15 of24 Specialists, Inc. vs. Commissioner of Internal Revenue x------------------------------------------------------------------------------------------x Exhibit No. Payor's Name Amount Amount "P-10-b-1" ABS-CBN Film Productions, of Income of Tax "P-10-b-2" Inc. Payment Withheld "P-10-b-2" ABS-CBN Film Productions, "P-10-c" Inc. 9,920.60 1,488.09 "P-10-d" ABS-CBN Film Productions, "P-10-e" Inc. 22 222.22 2,222.22 Ace Saatchi and Saatchi 11 764.71 1,764.71 Advertising Co Inc Ace Saatchi and Saatchi 2,163,815.50 43 276.31 Advertising Co Inc Ace Saatchi and Saatchi 2,293,593.50 45 871.87 Advertising Co Inc 198,432.00 3 968.64 "P-10-f' Analog Devices Gen. Trias, Inc. 1 764,827.45 35 296.55 "P-10-g" Asalus Corporation 1,241,813.78 24,836.28 Asalus Corporation L241,813.78 24,836.28 "P-10-h" Asalus Corporation " P - 1 0 - i 01 Asalus Corporation 19,053.31 381.07 "P-1 0-j" Asalus Corporation 87,172.01 1,743.44 "P-10-k" Asian Academy of Television 211 392.13 4 227.84 Arts Inc. "P-10-1" 82,352.94 12,352.94 Ayala Land, Inc. 512,249.05 10 244.98 "P-10-m" Bamboo Organ Foundation Inc. 235,994.12 35,294.12 Bautista, Christian Joseph "P-10-n" Morata 1 748,158.02 174,815.80 176 470.60 26 470.59 "P-10-o" BDO Unibank, Inc. !88,235.27 28,235.29 BDO Unibank, Inc. 13,392.86 "P-!O:p" Berjaya Auto Philippines, Inc. 37 333.33 267.86 "P-10-q" Big Big Big, Inc. 3,333.33 5,882.14 "P-10-r" Bloomberry Resorts and Hotels, 117.64 ''P-I 0-s" Inc. 11 274.11 225.48 "P-1 0-t" Bloomberry Resorts and Hotels 14,705.36 Inc 714,285.71 294.11 "P-10-u" 667 043.14 14,285.71 Bloomberry Resorts and Hotels 969,645.31 13,340.86 "P-10-v" Inc 19,392.91 45,403.02 "P-10-w" BPI Family Savings Bank 235,294.13 908.06 "P-10-x" BPI Family Savings Bank 141,176.47 35,294.12 "P-10-y" BPI Family Savings Bank 21,176.47 "P-10-z" BPI Family Savings Bank 16,666.66 "P-10-aa" Brandaction, Inc 1 666.67 Brandaction, Inc 8 928.57 "P-10-bb" Bridges_@ Com Inc 1,607 142.86 178.57 "P-10-cc" Calayan Surgicentre 32,142.86 Corporation 257 731.96 38,659.79 "P-10-dd" City_ Government of Valenzuela 36 385.69 Co, Elizaldy S. 5J457.85 "P-10-ee" Co, Elizaldy S. 164,705.83 24,705.87 "P-10-ff' 145,542.75 "P-10-gg" 80,357.13 21 831.41 80,357.13 12,053.58 "P-10-hh" Creasia Inc. (20,000.00) 12,053.58 52,941.18 "P-10-ii" Creative Juice l400.00l Communications, Inc. 7,941.18 "P-1 0-jj" "P-10-kk" Creative Programs, Inc. Nl "P-10-11" Creative Programs, Inc. "P-1 0-11" Creative Programs, Inc. Creative Programs, Inc.

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Page 16 of24 Specialists, Inc. vs. Commissioner of Internal Revenue x------------------------------------------------------------------------------------------x Exhibit No. Payor's Name Amount Amount "P-10-mm" Cultural Center of the of Income of Tax Philippines Payment Withheld "P-10-nn" Cultural Center of the 89 285.71 13,392.86 Philippines 107 142.86 16 071.43 "P-10-oo" Cultural Center of the "P-10-pp" PhilipQines 10 892.86 I 633.93 "P-10-qq" 880,599.21 17,611.98 Dentsu Philippines, Inc. 743,661.00 14,873.22 EON (Events Organizer Network) Inc. 164,706.00 3,294.12 45,454.55 909.09 "P-10-rr" EON (Events Organizer 15,000.00 300.00 Network) Inc. 470,588.24 "P-10-ss" 70 588.24 Ever Bilena Cosmetics, Inc. 100,000.00 "P-10-tt" Ever Bilena Cosmetics, Inc. 2,000.00 Ever Bilena Cosmetics, Inc. 223,214.29 "P-10-uu" First Asia Realty Development 4,464.29 Corp 2,716,620.35 "P-10-vv" 54 332.41 552,941.18 "P-10-ww" First Asia Realty Development 82 941.18 Corp 1,279,411.76 191,911.76 "P-10-xx" First Philippine Holdings 200,000.00 Col]loration 117,647.06 30 000.00 11,764.71 "P-10-yy" Five 2 Seven Entertainment 94 117.64 Production 1,160,714.00 14,117.65 23,214.28 "P-10-zz" Five 2 Seven Entertainment 89,751.40 13,462.71 Production 16,666.67 22,222.22 I 666.67 "P-10-aaa" Fullhouse Asia Production 117,647.05 2,222.22 "P-10-bbb" Studios Inc 17,647.06 GMA Network, Inc. 35,714.29 76 785.71 714.29 "P-10-ccc" Golden Arches Development 7,589 285.50 I 535.71 Corporation 151,785.71 "P-10-ddd" 58,823.53 Golden Donuts, Inc. 8 823.53 "P-10-eee" Grolier International, Inc. 35,294.12 GV Productions, Inc. 5 294.12 "P-10-fff' GV Productions, Inc 58 823.53 "P-10-ggg" Ideashop Manila Inc 8,823.53 "P-10-hhh" I ,021 964.27 153,294.64 "P-10-iii" Intelligent Beauty Skin 1,214,420.09 Solutions Inc. 105,882.36 24 288.40 "P-I 0-jjj" 15,882.35 "P-10-kkk" !-Remit Inc. I ,250 000.00 62,500.00 "P-10-lll" 485 071.43 9,701.43 Jollibee Foods Corporation 20 000.00 Magic Leaf Marine Logistics 1,000 000.00 55,588.24 Corp. 370 588.27 10,714.29 "P-10-mmm" Magic Leaf Marine Logistics 80,000.00 Corp. ~ "P-10-mmm" Magic Leaf Marine Logistics Corp. "P-10-nnn" Makati Shangri-la Hotel & Resort, Inc. "P-10-ooo" Manila North Tollways Col]loration "P-10-ppp" "P-10-qqq" Manuela Corporation "P-10-rrr" "P-10-sss" Manulife Data Services, Inc. "P-10-ttt" Manulife Data Services, Inc. Marivent Resort Hotel Inc. Megaworld Corporation "P-10-uuu" Nationa! Commission for Culture and the Arts

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 17 of24 X------------------------------------------------------------------------------------------X Exhibit No. Payor's Name Amount Amount "P-10-vvv" Organisasyon ng mga of Income of Tax Pilipinong Mang-aawit, Inc. Payment Withheld "P-10-www" Ortigas and Company Limited 178 571.43 26 785.72 "P-10-xxx" Partnership 1 127,514.20 22 550.29 "P-10-yyy" Perez De Tagle, Fabie & Jentes "P-I 0-zzz'' Co., Inc. 352,941.20 52 941.18 "P-10-aaaa" "P-10-bbbb" Philippine Educational Theater 82,352.94 12 352.94 Association, Inc. 70,588.20 10L588.23 "P-1 0-cccc" 141,176.47 21 176.47 Pilipino Cable Corporation "P-1 0-dddd" Pilipino Cable Corporation 175 434.00 3 508.68 "P-10-eeee" 141,176.47 21)76.47 "P-10-ffff' Philippine Long Distance 141,176.47 21 176.47 "P-1 0-gggg" Telephone Company 117,647.06 17 647.06 176,470.59 26 470.59 "P-10-hhhh" Prime Events Force Unlimited Inc. 159,793.73 23 969.06 "P-10-iiii" Push Associates Inc 375,080.39 7 501.61 "P-10-.iiii" Red Events & Communications, "P-10-kkkk" Inc. 3,413,428.72 68 268.57 Red Events & Communications, "P-10-1111" Inc. 125 026.80 2 500.54 "P-10-mmmm" 133,928.57 20 089.29 Ro binsons Land Corporation 70,588.27 10 588.24 "P-1 0-nnnn" (Crowne Plaza Galleria Manila) 664 143.00 13L282.86 "P-10-oooo" "P-10-pppp" Samsung Electronics 8,084.13 161.68 "P-10-qqqq" Philippines Corporation 1' 172 766.64 23 455.34 "P-10-rrrr" 12L053.57 Samsung Electronics 80,357.14 12 053.57 "P-10-ssss" Philippines Corporation 80 357.14 16 741.07 111,607.14 16 741.07 "P-10-tttt" Samsung Electronics 111,607.14 12 053.57 "P-1 0-uuuu" Philippines Corporation 80 357.14 16 741.07 "P-10-vvvv" 111607.14 14 285.71 Shangri-la Plaza Co~oration 142 857.14 "P-1 0-wwww" Sky Cable Corporation 24 971.58 SM Mart Inc 1,248,578.89 "P-10-xxxx" 24,971.58 Smart Communications, Inc. 1,248,578.89 "P-1 0-yyyy" SPI CRM Inc 12 763.95 638 197.46 Strategic Works (Stratworks), ~ Inc. Strategic Works (Stratworks), Inc. Strategic Works (Stratworks), Inc Strategic Works (Stratworks), Inc Strategic Works (Stratworks), Inc Strategic Works (Stratworks), Inc Team On Ground Inc The Philippine American Life and General Insurance Company The Philippine American Life and General Insurance Company The Philippine American Life and General Insurance Company

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 18 of24 X------------------------------------------------------------------------------------------X Exhibit No. Payor's Name Amount Amount The Philippine American Life of Income of Tax "P-10-zzzz" and General Insurance Payment Withheld Company "P-10-aaaaa" The Philippine American Life 638,197.46 12,763.95 and General Insurance "P-10-bbbbb" Company 291 797.86 5,835.96 The Philippine American Life "P-1 0-ccccc" and General insurance 26785.71 535.71 "P-1 0-ddddd" Company 136,082.47 20,412.37 Tupperware Brands Phils. Inc. 9D,721.65 13,608.25 "P-1 0-eeeee" Tupperware Brands Phils. Inc. Tupperware Brands Phils. Inc. 64,705.88 9,705.88 "P-1 0-fflif' TV5 Network Inc. 298,235.34 44,735.30 "P-10-fffff' TV5 Network Inc. 848 823.66 127,323.55 "P-1 0-ggggg" United Coconut Planters Bank 446,428.57 "P-1 0-hhhhh" United Coconut Planters Bank 1,769 249.34 8,928.57 "P-10-iiiii" United Coconut Planters Bank 35,384.98 "P-1 0-.iiiii" Vidanes, Elizabeth Alviar 35,114.05 "P-10-kkkkk" 52,941.17 5,267.11 "P-10-lllll" Whitelight Creative 7941.18 Management Inc. "P-10- Xolutions Are Us, Inc. 147 058.82 22,058.82 160,714.29 24,107.14 mmmmm" SPI CRM Inc "P-10-nnnnn" 530,640.60 10,612.81 "P-10-ooooo" Golden ABC, Inc 89,285.71 1,785.71 Ayala Land, Inc. 5,543.17 "P-1 0-ppppp" Ace Saatchi and Saatchi 277 158.43 Advertising Co Inc 129 777.72 2,595.55 TOTAL 1'63,171,803.72 P3,382,759.34 However, after a careful examination of the above- enumerated Certificates of CWT, the following CWTs in the total amount of P812,236.95, should be disallowed from petitioner's claim for the reasons stated below: Amount Amount of Income of Tax Exhibit No. Payor's Name Payment Withheld 1. Supporting Certificates of Creditable Tax Withheld At Source (BIR Fonn No. 2307) were denied admission by the Court for failure to present the originals for comparison. 46 "P-10-1" Asian Academy of Television 1'82,352.94 1'12 352.94 Arts Inc. "P-10-m" Ayala Land, Inc. 512,249.05 10,244.98 "P-10-u" 11,274.11 225.48 "P-10-v" Bloomberry Resorts and Hotels 14,705.36 294.11 "P-1 0-ii" Inc "P-10-:xx" Bloomberry Resorts and Hotels 145,542.75 21,831.41 Inc 8,084.13 161.68 Creative Juice Communications, Inc. Smart Communications, Inc. "P-10-bbb" GMA Network, Inc. 117,647.06 11,764.71 "Resolution dated June 3. 2020. CTA Case No. 9817. Docket- Vol. II, pp. 1302 to 1303. tv!

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commiss ioner of Internal Revenue xP-a-g--e--1-9---o-f--2-4----------------------------------------------------------------------------x "P-10-ccc" Golden Arches Development 94,117.64 14,) 17.65 Corporation 89,751.40 13 462.71 "P-10-eee" Grolier International, Inc. "P-10-fff' GV Productions, Inc. 16 666.67 1,666.67 "P-10-iii" 35,714.29 714.29 "P-10-mmm" Intelligent Beauty Skin 35,294.12 "P-10-mmm" Solutions Inc. 58,823.53 5,294.12 "P-10-nnn" Magic Leaf Marine Logistics 1,021,964.27 8 823.53 "P-10-ppp" COI]J, 105,882.36 153 294.64 Magic Leaf Marine Logistics 15,882.35 Corp. Makati Shangri-la Hotel & Resort, Inc. Manuela Corporation "P-10-sss" Marivent Resort Hotel Inc. 1,000,000.00 20,000.00 "P- 10-aaaa" Pilipino Cable Corporation 141,176.47 21,176.47 175,434.00 3 508.68 "P-10-bbbb" Philippine Long Distance 141,176.47 Telephone Company 141,176.47 21,176.47 "P-10-cccc" Prime Events Force Unlimited 117,647.06 21,176.47 176,470.59 17,647.06 Inc. 159,793.73 26,470.59 23,969.06 "P-10-dddd" Push Associates Inc 70,588.27 10,588.24 8,084.13 "P-10-eeee" Red Events & 161.68 "P-10-ffff' Communications Inc. 1,172,766.64 23,455.34 "P-1 0-gggg" 80 357.14 12 053.57 Red Events & 80 357.14 12,053.57 Communications, Inc. Robinsons Land Corporation 1 248,578.89 24,971.58 (Crowne Plaza Galleria Manila) 638 197.46 12,763.95 "P-10-1111" Sky Cable Corporation 638,197.46 12,763.95 "P-10-nnnn" Smart Communications, Inc. 90,721.65 13,608.25 "P-10-oooo" SPI CRM Inc "P-10-pppp" "P-1 0-qqqq" Strategic Works (Stratworks), "P-10-wwww" Inc. Strategic Works (Stratworks), "P-1 0-yyyy" Inc. The Philippine American Life "P-10-zzzz" and General Insurance Company The Philippine American Life and General Insurance Company_ The Philippine American Life and General Insurance Co m.JJa"Y. "P-10-ddddd" Tupperware Brands Phils. Inc. "P-10-hhhhh" United Coconut Planters Bank 1,769,249.34 35,384.98 "P-1 0-iiiii" United Coconut Planters Bank 35,114.05 5,267.11 "P-10-iii.ii" Vidanes, Elizabeth Alviar 52,941.17 7,941.18 SPI CRM Inc 530 640.60 "P-10- Ayala Land, Inc. 277,158.43 10,612.81 mmmmm" 5,543.17 "P-10-ooooo" t!

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue xP-a-g--e--2-0---o-f--2-4----------------------------------------------------------------------------x Subtotal 13,804,433.06 666,596.18 2. Supporling Cerlificates of Creditable Tax Withheld At Source (BIR Fonn No. 2307) are out of the claimed period. "P-10-hhh" Ideashop Manila Inc 117,647.05 17 647.06 "P-10-uu" Ever Bilena Cosmetics, Inc. 470,588.24 70,588.24 "P-10-ww" First Asia Realty Development 223,214.29 4,464.29 Corp 811,449.58 92,699.59 Subtotal 3. Supporling Cerlificate of Creditable Tax Withheld At Source (BIR Fonn No. 2307) is not in petitioner's name. "P-10-xxx" Perez De Tagle, Fabie & Jentes 352,941.20 52,941.18 Co., Inc. Subtotal 352,941.20 52,941.18 TOTAL P14,968,823.84 p 812,236.95 Accordingly, petitioner was able to satisfy the second requisite, but only to the extent of the duly substantiated CWT of P2,570,522.39.47 Third requisite: Petitioner failed to prove that the income payments subjected to CWTs were declared in its 2015 AnnualiTR. ianscpomaTrethoepfatiyhtmsirdgernrotessqssuiuinsbcijtoeemcmteedainntdoitasCteWAsnTpnseuwtaiteliroIeTnRreerfpotoorrFtpeYrdo2vo0er1dt5he.caltatrheed pTCWYeWitti2Thti0hTo1ofno5ole,drp4rmir8nopegQvrdeeuTsatpaehrxantaerettestrldty(ho"iefSItTsAipRnWoecsrtToiifg"tmoi)iorneTfnaopYelrraaT'y2snYm0d1de2e5an0cm,t41ls9ae5rrn,SeseduodleamadtienmndAdcaontr2omyn0uteA1ha5ellppIchAeTlarauRlidismIsiTttfeeRooddr,f Financial Statements ("AFS").51 v wEt2h0viat1ahtn5htgPheaeeellsdtiiinntewievcooieGndrme.eerneA'sdcpgeewaudcyslitmatbinrnyeee,ndstbhstsoeeastsrha,emppMteraeessrnt.stidefMonieefdtidicnphAigeenntltilnthtehiueoeaLPnilrae3IcJr,T'5ussRa8dmi5ianc,anc9ianod4lam9AS.ea0Afnf0WfiddotTaraMvxfTieostYss.r TY 2015, to wit: 47 PEEEE3xxxx,hhhh3iiii8bbbb2iiiitttt,ss7�"'"P"5PPP9--21--.133"5-"4,"a,,lC"e"CTsPasTAn-4A1d"'C8",Ca1P"s2a-Pes1,2-e"N53,"N6oC,..o9aT.95nA89.d18C"71P,7a-,sD5eD-oaNoc"okc, .keC9teT-8t A-1V7Vo,Clo.Dal.sIoIeI,cIN,pkppoe.p.t.1-9018V7211o67l8,.toDItIo,1o0p1c7p2k6.8e.21t.0- 6V2otlo. 1069 and 1054 to 1061. 48 II, pp. 1078 to 1087. 49 50 51

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue xP-a-g--e--2-1---o-f--2-4----------------------------------------------------------------------------x "Q27: You mentioned that the amount of P3,585,949 arose from excess income tax payments of Stages for the taxable year 20 15, what proof can you show that the excess income tax payments of P3,585,949 were declared as part of Stages' income for the taxable year 2015? A27: I also have the Amended Annual Income Tax Return ('ITR)-BIR Form 1702-RT of Stages and Summary Alphalist of Withholding Taxes ('SAWT') for the year 20 15 which prove that the amount of income payments representing the P3,585,949 taxes withheld were declared as part of the income of Stages for the taxable year 2 0 1 5 . " 52 "Q32: You mentioned that the amount of P3,585,949 from excess income tax payments of arose for the taxable year 2015, what is your Stages proof that the income payments representing the excess income tax payments of P3,585,949 were declared as part of Stages' income for the taxable year 2015? A32: Aside from the CWTs which I have identified earlier, I also have with me the Amended Annual Income Tax Return ('ITR')-BIR Form 1702-RT of Stages and Summary Alphalist of Withholding Taxes ('SAWT) for the year 2015 which prove that the amount of income payments representing the P3,585,949 taxes withheld were declared as part of the income of Stages for the taxable year 2015."53 Notwithstanding the foregoing testimonies and the above- mwwiMwwstnhteheeiacsetrnr.eotheeittmESnohiiodvAguneenea.trdWbnceeTytlggTdehahuewderdeliaeiadroinndbyeincednpacauogGorosmfterm.thathpeAeteeihnaedsgsrtapCauttaCsairesntmoyyotrydfitmuoniectffrnxhoieiotcinhennreaaimtcststbishelneiutosetscdossfiuoi,rophMobmrftoanjehseerwCs.etctprhotMoteeCefahfcdditopetpicitutehetvaahotrteebmietilttlClJiieiaoeosuoWmunndLTuneTeioanarctrsuxcsa'ifsansbfoiWoal2tnlrsemrA0dTiTtwi1fYtahYcfo5nihiadtea2vthg2aele0hrvd0adro1eiin1tfs5lias5dydns,,t tv! 52 Exhibit "P-18", CTA Case No. 9817, Docket- Vol. 11, p. 782. 53 Exhibit "P-17", CTA Case No. 9817, Docket- Vol. 11, p. 1289.

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 22 of24 x------------------------------------------------------------------------------------------x Source formed part of the declared income in the 20 15 Annual ITR, were not sufficient to prove that income payments subjected to CWTs were declared as part of petitioner's gross income in its 2015 Annual ITR. Simply put, petitioner's failure to prove its compliance with the third requisite is fatal to the present refund claim. Given the foregoing disquisitions, petitioner failed to sufficiently prove its entitlement to a refund of the excess CWTs forTY 2015. There is no automatic grant of a tax refund. 54 Strict compliance with the mandatory and jurisdictional conditions prescribed by law to claim such tax refund or credit is essential for such a claim to prosper. 55 It must be emphasized that actions for tax refund or credit, as in the instant case, are in the nature of a claim for exemption, and the law is not only construed in strictissimi juris against the taxpayer but also the pieces of evidence presented entitling a taxpayer to an exemption is strictissimi scrutinized and must be duly proven. The burden is on the taxpayer to show that he has strictly complied with the conditions for the grant of the tax refund or credit. Since taxes are the lifeblood of the government, tax laws must be faithfully and strictly implemented as they are not intended to be liberally construed. 56 WHEREFORE, premises considered, the instant Petition for Review is DENIED for lack of merit. SO ORDERED. /J41;t;rl fi/Af)j WE CONCUR: LANEE S. cUi::'riAVID Associate Justice (I reiterate my Concurring OpffidOn in the assailed Decision) ROMAN G. DEL ROSARIO Presiding Justice ~4 Commissioner ofInternal Revenue vs. Far East Bank & Trust Company, G.R. No. 173854, March 15,2010, 629 SCRA 405-418. 55 Commissioner of Internal Revenue vs. San Roque Power Corp., G.R. Nos. 187485, 196113 & 197156, February 12, 2013,703 PHIL 310-434. 56 Coca-Cola Bottlers Philippines, Inc. vs. Commissioner ofInternal Revenue, G.R. No. 222428, February 19, 2018.

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 23 of24 x------------------------------------------------------------------------------------------x ~. ~ -? '-...... MA. BELEN M. RINGPI8:IiiBAN Associate Justice ~'7-_ CATHERINE T. MANAHAN Associate Justice (" JEAN MARIPY.IW fitf>RRO-VILLENA MARIA RQ\Vfl ~bESTO-SAN PEDRO ~ ~ /f ~1/Ji -fa;~ MARIAN IVY i/. REYEfi-FAJJ(RDO Associate Justice CO~N~G~~ -�, . -. ON LE~V~ HENRY SUMAWAY ANGELES Associate Justice }fnl

DECISION CTA EB No. 2658 (CTA Case No. 9817) Stages Production Specialists, Inc. vs. Commissioner of Internal Revenue Page 24 of24 X------------------------------------------------------------------------------------------X CERTIFICATION Pursuant to Article VIII, Section 13 of the Constitution, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court. Presiding Justice ftr(