COMMISSIONER OF INTERNAL REVENUE v. PHILIPPINE AIRLINES, INC.

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY ENBANC COMMISSIONER OF INTERNAL CTA EB No. 2866 REVENUE, (CTA Case No. 8340) Petitioner, Present: -versus- RINGPIS-LIBAN, P.f.t BACORRO-VILLENA, MODESTO-SAN PEDRO, REYES-FAJARDO, CUI-DAVID, FERRER-FLORES, and ANGELES,JL Promulgated: PHILIPPINE AIRLINES, INC. -- - -F--E-B--0-3--2-~ ~ =- ' l-'/<B ,,.... . Respondent. - --- � - --X X---- - --------------------- RESOLUTION REYES-FAJARDO, J.: For resolution by the Court En Bane is petitioner's Motion for Reconsideration (Re: Decision promulgated 24 April 2025) (Motion)1 in CTA EB No. 2866 filed on May 7, 2025, with respondent's Comment (Re: Motion for Reconsideration dated 14 March 2025) filed on July 2, 2025.2 In the Decision dated April 24, 2025 (assailed Decision),3 the Court En Bane affirmed the findings of the Court in Division, ruling that respondent is entitled to a partial refund of P3,133,270.14. This amount represents excise taxes erroneously paid on respondent's importations of wine and liquor products intended for international Rollo, pp. 106-125. 2 Id. at pp. 137-149. 3 Id. at pp. 90-105.

RESOLUTION CTA EB No. 2866 (CTA Case No. 8340) flight consumption. The dispositive portion of the assailed Decision reads as follows: WHEREFORE, the Petition for Review, filed by the Commissioner of Internal Revenue on February 13, 2024 in CTA EB No. 2866, is DENIED, for lack of merit. The Amended Decision dated October 5, 2023 and the Resolution dated January 12, 2024, both rendered by the Court in Division are AFFIRMED. SO ORDERED. The Court En Bane explained that the Supreme Court, in its Resolution dated July 9, 20184 affirmed the Court of Tax Appeals (CTA) En Bane's decision in CTA En Bane No. 1347, which held that respondent satisfied the requirements for excise tax exemption under Section 13 of Presidential Decree (PD) No. 15905. These requirements are: (1) payment of corporate income tax; (2) use of imported supplies for its operations; and (3) unavailability of such supplies locally in reasonable quantity, quality or price. Accordingly, the Supreme Court ordered the remand of the case to the CTA for the reception of evidence relevant to the computation of respondent's refund claim. Following the Supreme Court's directive, the Court in Division in CTA Case No. 8340 determined that respondent is entitled to a refund amounting to P3,133,270.14, representing excise taxes paid on wine and liquor products whose importation costs were lower than their local purchase prices. The Court En Bane ruled that respondent's evidence, including the testimony of its witness; comparative table of cost of importing and cost of locally purchasing commissary and catering supplies; sales invoices issued by foreign suppliers; price lists; and, monthly Philippine dealing system rates, were sufficient to establish that the cost per bottle of importing said products was indeed lower than purchasing them locally. Hence, respondent should be exempt from excise tax. G.R No. 238163. An Act Granting a New Franchise to Philippine Airlines, Inc. to Establish, Operate, and Maintain Air-Transport Services in the Philippines and Between the Philippines and Other Countries.

RESOLUTION CTA EB No. 2866 (CTA Case No. 8340) In the present Motion, petitioner reiterates its argument that respondent failed to prove that the imported wine and liquor products were not locally available in reasonable quantity, quality, or price, citing CIA decisions in CIA Case Nos. 10311 and 9913 as supporting authorities. By way of Comment, respondent contends that the CIA decisions rendered by the Court in Division do not constitute binding precedent unless affirmed by the Supreme Court. Respondent further cites Supreme Court decisions involving the same parties, wherein the Court recognized similar evidence as sufficient to prove that the imported wine and liquor were not locally available in reasonable quantity, quality or price. Accordingly, respondent maintains that it has adequately demonstrated its entitlement to an excise tax refund amounting to "1'3,133,270.14. The Motion is denied. Indeed, petitioner's arguments were already considered and rejected by the Court En Bane in the assailed Decision. Given the finality of the Supreme Court's Resolution affirming respondent's entitlement to a refund, the remand of the case to the Court in Division was solely to determine the amount due. There is no basis to depart from the Court in Division's finding that respondent is exempt from excise tax to the extent of its imported wine and liquor products, as evidence showed importation costs were lower than local purchase prices. There is no need to reiterate pertinent portions of the Decision or re-write the ponencia in accordance with the outline of the instant motion.6 The pronouncement in Social Justice Society (SJS) Officers, et al. v. Lim7 on the effect and disposition of a motion for reconsideration is instructive: The filing of a motion for reconsideration, authorized by Rule 52 of the Rules of Court, does not impose on the Court the obligation to deal individually and specifically with the grounds relied upon therefor, in much the same way that the Court does in its judgment or final order as ' G.R. Nos. 187836 & 187916, March 10, 2015. 7 Id.

RESOLUTION CTA EB No. 2866 (CTA Case No. 8340) regards the issues raised and submitted for decision. This would be a useless formality or ritual invariably involving merely a reiteration of the reasons already set forth in the judgment or final order for rejecting the arguments advanced by the movant; and it would be a needless act, too, with respect to issues raised for the first time, these being, as above stated, deemed waived because not asserted at the first opportunity. It suffices for the Court to deal generally and summarily with the motion for reconsideration, and merely state a legal ground for its denial (Sec. 14, Art. VIII, Constitution); i.e., the motion contains merely a reiteration or rehash of arguments already submitted to and pronounced without merit by the Court in its judgment, or the basic issues have already been passed upon, or the motion discloses no substantial argument or cogent reason to warrant reconsideration or modification of the judgment or final order; or the arguments in the motion are too unsubstantial to require consideration, etc. WHEREFORE, petitioner's Motion for Reconsideration, filed May 7, 2025 is DENIED, for lack of merit. SO ORDERED. ~ 9-.A.A� r. ~-f~~ MARIAN-I{?Y F. REYES-FAJARDO Associate Justice We Concur: ~�~')- MA. BELEN M. RINGPIS-LIBAN Presiding Justice I . BACORRO-VILLENA ciate Justice

RESOLUTION CTA EB No. 2866 (CTA Case No. 8340) PageS of5 ustice c~ L:X:E LANEE S. CUI-DAVID Associate Justice c~~.~~~~~s Associate Justice HENRY j~NGELES Associate Justice