CTA Case No. 966 (Resolution)

. f.' / ~PUBLIC OF THE PHILiPPINES CDURT OF TAX APPEALS MANILA CALTEX (PHILIPPINES) INC., Petitioner , - versus - C. T. A. CASE 1'-0. 966/ C0Iv1MISSIONER OF I NTERNAL REVENUE , Hespondent. X- - - - ------X RESOLUTION The petitioner is seeking the refund of 1!5 , 781.68 , representing alleged overpayment of compen - � - . satin9 tax .on various items of machinery , equipment , accessories and spare parts imported by it from 1958 to 1959. The facts giving rise to ths alleged over- paymen t are stated in the amended petition for review , as follows: X X X 5. That on several occasions in 1958 and 1959 , petitioner imported from abroad various items of machinery , equip- ment � accessories and spare parts for use in its deoots or installations and in the gasoline service stations f V!hich are described and itemized in Annex u � 11 at - tached hereto , and made an integral part of this petition ; 6. Tint the Collector of Customs of Manila levied and collected on the aforesaid importations the special i mport tax imposed by Republic ct Ho. 1394 and included said tax in the landed cost of the imported merchandise for the purpose of computing the compensating tax due thereon under Section 190 of the rational Int ernal Bevenue Code; that respondent , through the Collector of Customs of Manila , collected from petitioner the compensating tax so computed and which petitioner paid \I

R.CSOLUT ICN = Co":'"' � CAS E Nl ; . 966 - 2- on the dates and under the official re - ceipts indicated in Annex "A" ; 7. That the aforesaid importations by pe titioner were not subject to spe- cial tax on the ground that Section 6 of Republic Act No. 1394 exempts from special import tax "machinery , equipment, accessories and spare parts for the use of industriesn and petitioner is engaged in a productive enterprise in which it .has employed substantial amounts of capital and labor in connection with the refining , storage , handling and distribution of petroleum products ; 8. That respondent , through the Collector of Customs of Manila. errone- ously included the special import tax in the landed cost of the imoorted merchan- dise for purposes of computing the com- pensating tax due thereon and, as a consequence , excess compensating taxes were collected thereon from petitioner in the total sum of jt5 , 781.68. 9. That petitioner filed claims for refund of the excess compensa ting taxes pa id by it in the aforesaid sum of -5, 78,1;�.6_� and 1 until now~ respondent has failed to refund to petitioner the aforesaid amount nor has he denied said claims of petitioner; 10. That inasmuch as the two-ye ar prescriptive period for recovery of in- ternal revenue taxes illegally or errone- ously collected as provided in Section 306 of the National Internal Revenue Code will soon expire , petitioner has filed the instant appeal while awaiting res- pondent ' s decision on its claims for re- fund in order to protect its interests. (Pag es 40-41, C. T. A. records . ) It appears that the alleged overpayment of the compensating tax was due to the collection of the spe- cial import tax on the said importations ~ pursuant to Republic Act No.. 1394 and the inclusion of said tax in the landed cost of the imported merchandise in the computation of the compensating tax under Section 190 of the National Internal Revenue Code. Petitioner

RESOLUTION - C.T . A. CASE NO , 966 -3- claims that , as it is exempt from the s pecial i mport tax , the said tax should not be included as part of the landed cost of the merchandise in computing the compensating tax . There is no question that if pe - titioner is exempt from the special import tax , such tax is not a part of the landed cost of the mer - chandise and , consequently , petitioner made an over- :payment of the compensating tax on said merchandise as a result of the inclusion of the ,special import tax as part of the landed cost thereof. Petitioner filed protests against the levy and collection by the Collector of Customs of Manila of the special import tax in question , but it does not arpear that the question has een finally resolved by the customs authorities . The question in regard to the exemption of petitioner from or liability for the special import tax is a matter falling vdthin the jurisdiction of the Bureau of Customs and not of the Bureau of Internal Revenue. Until and after the question in regard to the special import tax is resolved , the le - gality or correctness of the compensating tax collect- ed on said merchandise cannot be determined. 1EREFORE , the herein petition for review i s

RESOL rrrm: - C. T� � C ~c ~D . 966 -4 - hereby dismissed without prejudice . No pronoun cement as to costs o SO ORDERED. Manila , August 31 , 1962. ~~ Presiding Judge lE CO~TCUR :