CTA Case No. 5099 (Decision)

\~ I . _,-.:"'" REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY Af- HOLDHiGS At1D MANAGEMENT CORPORATION, COMMISSIONER OF INTERNAL C.T.A. CASE NO. 5099 Promulgated: REVEi'!UE, MAY 091996%- X- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - X DECISION 11 ���1� .11�,�=-' t"���t" =��.}�t� i.�...,-:,:.:-.:.=��.~ ij!i..T. ~�t*�.�.�-'t�.T,.�~�:�:-:~� rI�)�f�:�:l-'!1_".j..t1" �..._..~t1. . !~::�:' t�'.:-:,~._.a. 1.fl1 '-..' f..."~�'[J_J_f...l�~"... i '�.")��tT�-�.-.::l.rt)T,:�.:.JJ.ti��. i J. -.:.re�.:lita.ble ~,~.,rith1D1dinQ� t.G~e�:. f�)r t::c-::J.ble ve::lr 1qq 1. '-' I �� On ...::c..rril 1\ 1992, petiti(mer filed v..ritll the eureau c�f IntenE1.l Eevenu.::> its Cc�rpcrate Annua.l Income Ta.x RetFrn for the (5ro::::3 Income ( 1991) P l.OJO,Of)O.OO Le-:::::: Peducticrr:: (E:-11. i�.- 11) 1 0 1!) .:=;,'-) 7 .OC' Net Tax::�.ble ItE<�me (Ei11. A-4) l . r. r� QO\J

DECISION- C.I.A. CASE HO. 5099 -2- T:3.Z Du~ lE:::h. i�, -~,) p 24, 1.':>9.00 L>?�;�;: ;:J:' Pri':'r ;,oe::u-��; ex:>?% �:-redit b) 1)u.:uterlv r-. zrvments r -. ~ .6- 1�--~..(-l�. n-o- (E~1i:3. A-f.. E. t~ :C.-1) 6 C:,(Jl).OO �:) Cr>?..Jit::1.blt- Ta.x 'i,i1l"it.hl1d.J (E;.jE . �.::.. -9 .3-: C) :�: T;J_g EeflJ.nd;3_b1e 1� .��p...:.-.,, ..-). {.rc!.~..:t--ul D-1 ) . t,-. e. _. �-� � -� �- ___,,. ::>t�r����-�JJt�,r� ��r�� .:1.""' .!.��-�' __ !,,;. -� �-�� F)�..~...�_c.,_l lf.i_!.�I:__').�(-�i��{-�l '��-�11__1-._�. -----� tl_.1....::--:--. 1���---���lir.t.�._..f~�.�,,T.l.!l�-,. t�:::,:_i~':.:"..". r�r.:::.r�ll�t�=: t_��.-�._��.���tl1,1. tr-���.J--J-t._:,.:._:..�.--'l i:Jr.-:.-;'3 ItE�c�m>:> ( 1992) F� 6 ~~O.OOO.CtO Les:::: � De(!JJ.ctwns Net Lc��::;:. l 4(iC:, 1oc:, 00 oc:.. (p.~~.6C.i,l O,.)) Tax Due - N I L- 2c:. 1o.=~�. oo Le::;:;: Pt�l�..-��r �:j -~ ~7~�-..,t�'.:- ..-�t�~(ll�t l �,� 1_. '-�� I >=>'.T(�.:::.�=:�=: �,.� ~ ,_1 '�' "- &.'..� .,��_ -� '�' .... �� (�.EXli . D-2).� P 1?-..�_6;0--?�-.�- 00- b- .-'~ C....:n-L� -.:�l�t"f-.:-::.�t-1� V.. rt-,::-n./rtJ'!- .:-::011t-~:-:; iEyt�1:=; F.-�) E-g ,:<:.. E- ~(. �, I. ~ ....... - � :....;; .�.I ��� �' �-I. ' c) Cr-dita.ble. Tax 'vVithhe.ld :.o. (Exh. E-ll for .:=ml'v . 6 c:,oo.oo p .}.2 [)f)) p 2~�.l 06.00 u[.. c , ... 0 ll

DECISION. - C.T.A. CASE HO. 5099 -3 - UtE1.ble to apply tile ;:unount refundable of P U}.6CH}O(J. income ta;r for the ::;ucceeding taxable year ( 1992 ). petitioner filed :::~_ �written .::J:dm for refund on Februa.rv 2�;�,, 1qq4 (Exh. E-1) l �-�. �� ~,~lith the Revenue Re!=2-� "ional Direct()r c.f the BI.R. Petitioner is rn :-;:: ,-_.-~. 1(_) r.-.'.'. (_)(_)_, r�c-..�nrt���;::;.�c-�-�;-:�:�-:�.t�r� t....i..1�1::o:. ;�:-:�:....,..._..,.,.,���.~;�::;.._�~:�.c_.: r..�.t�c.-.~-..�.!1. t-=-t�b�-�fc�-�. "\,,�,,11.t-r� '�lf..-l�f-�;lr..lt.t�~�oc.- t~=_1_X-.;-:.._::=_; resulting to the �:)Verpayment. �:)f income t:.l.x for the years 1991 1"1(.1 1q q E) ;:::>!._. :. :- ,-.;~.,, ' t�.::.c�r-�.::.��-ti u '=�:�:'�1'~)'T {r.E-.:~.:~~J-1 . i. .L '�.� �-' _.L.... ���� .�..!.. y Respondent did not ;:Jet on such cla.im for refund. Hence, .� � r;r�t�1 1 ft�l.::.rl .Jt::�-r�t.t-i��,�....-,t-1�..'.". '!- .a. ��-� �- �q-�- r-�-.��.�:-�:.t1-� .t1-��'��-�)1�1 1�-�.-..�-�t� r�~�'-,'�.�a�.t�-c.�.tv\T.� ,,,.r1�t1�1 +t1-11.-c--� r._�.f�._�_l_l_lt-t.-, �-..-.�.�.t-1 ~ ,\ __.c >. r� J. refund. The petitkm is ho1Never lirnited �.)nly to the a.mount of r�> 1�;:..), ~�-=�-�.�.(..��,�~.�) ..(_J. (�Ji�, a-t�!�'=-::�'0o~�.-�..-_ll�)�y t��c._. .f-;-!�;:._:.:.�c-���c-�.1�1t�..�1-L,-;:,:.. C....'-��"'~�;-:�:.:_.. c�-����:-�� �..-...!-.._:.:t._��I1"..t.-3.11..!-.l.c_.. 'itVT1�.t.11�1L�r,t�'��-l"11-1,;-:,:-. .-,f �:�t�:,tc..-1 I!-l r��r-,-�:.c_�.Ir_�.�r-..;_.t.1c��-.�:�:�-.�, r�~r,�-:c._-.r1�_..-..�._�.t�-_lt�.�J'=��::�' t�! t.....; �'-�� .���-���-� t..t.�ik-f=.>..t. .t~--lLc.. ��._�.�t,~J.1�!-!1- 1� (-J.!- !-~--1� -1]1.1,.-..1 �.... rr--�. 1�P.), ,�_=.�. n�-� (�=)-. n�._. n�.� 1�..:-.. !L-,..1-. t.. f..�r!-'.�-���,tr-�'"=~."t�t�y� '��.�1��.�_�.....-_. .lJ.-!-I;I::.;,.!1t�-;�:�:-:�..~-.1. In an ::v::t.ion for refunr::l or t;.x credit the burden of proof is on tile ta.:xpayer to pro1le entitlement thereto othenvise. the claim 'i,o~lill be fat:.;.l. In this c::;se, petitioner failed to subrnit its l99Ct Incorne Tax Return to Petitioner repliwl tlEit 1t::: 1990 Inc(Hne T:;x Return ~Nas :Jtt::Jched t.c� its 1991 Ino)rne Tax Return V�then it filed :;;::tid ( 1991) Return 1A'it.1l the BIR :3s sh(:.i,V!1 in the filE rE>cords subr.nitted bv ' r�lt .-. 'l 1 1 I t-.-. tc tl� !::;'.c_.rr--�..�.v-�.t"\l_��l�-~�t-�i t.-�� De. t 1. nrl~t- rt-��,-r,�.-:�:.��-:��t.:-:.' _.t;'t_ �~- ��C--; ~�-� i7~ 1.���-lc.�-t�-1��.�,;..::�-:�. 1. (~�l 0 t"!U.)t"!-1f>.. �.�J -�' - !. �-� �-� �-� �-� - �-� Tax Return�::; ~Nitl1 :Jtt:v:lunents, consisting of: its T11ird Qua.rter -- -[ .,. l-, �~� vul

DECISiflH - C.LA. CASE HO_ 5099 -4- Incor.ne Tax Eeturn ic�r 19~~ 1. shovring p:3.yrnent of the :=-'.mount of 'lilithlleld ..!;J_ Source in the a.nwunt .:A P6,SOO.OO. ~Nit.hheld by P:::tseo Ee:::dty & Developtnent. Corporation (E;d1. C) and a1so its l c:�;�'�:,.k-., I�!.l-�...,.-.J.-!-I.L:.-. a.. T� �- v~�~.J'::::�:~'-t.lU 11 ,.._-~t�;��u\-l. [1. ,��,1�'.-.--.'1- t.-ll'to-~' f-�'1'--..-�, p e-.t- ~._.t,�. ~�:1l. lL�=:l,t�.f�t.-}-!i ,-.1- t��il b�,... ._J (f)Uft. r~:: petitioner entitled to the refund of P 1{;,60<\CH), covering the alleged overpaid in(:ome tax for 1991. r~sulting irorn excess credit.:tble ~A'ithholding taxes? The BIE re(:.:)rds ion<~t:t.rded to this Court form part of the ,��f I ��l !-o��~�.,�-~�-�,��-,r'.�..�1:~::-. �._.' t�l-�11.�c-�� �,��.�.��=�-1��cJo":�:":.". B): I Dr:.. 1� t.:�:.'-,-.-�.� t.�..�J�r�(.�..�J.c_�;.' 1� t t-,.~.,1�1�6rrt� .t:". L:_::,ll 11 -c-�~=~- ..i.. '�- '-' �c-��}�t,�.�-���.�t,;'l~�.~�......-~ t11~ '.r �-� 1991 In(:ome T::t.x Return of petitioner. filed on April l ::1, 1992. The f.:)1101..,ling documents '/lere att:v:hed to said return. narnely: ( 1) Audited Fin:3.ndal Statements_; (2) S(:hedu.le of Taxes and Licenses; (j) Photocopy of first page of prior vo&ar�s return ( 1990); (4) CerUfi(:a.to& of Credit.3.b1e Tax 'iNitllho&ld (Exl1. C\ and <:1) Schedule of refundable income tax. t... li''>c� t'tc- 7 Ail. l.�C-�� -;._"..�..;}��r�t��-~c.��,-����-�tl.~/Y f_-,.�-l-lt-� ��lTj Ir---�'t-=�'t-l�.tsl..-���-�-�-� �t��1-~� t- : r�,�-:�:�:-',c.,p..�r.��.�� ��t'-i.�"t:l::"~t�lt-� (.1.--~ �?:I. (-��c-��� �-p� ~T ..._~.f1� _._: 199r) Incorne Tax Eeturn. The original is in the custody and .�ll r�t� tli.:. ft" (�����t�Itr tr�l��� t�.::-c�r-' ����t�l�-I.:.r�lt 1.t�lc�t � t"Il Ci�::> \T1"1c�� ._..._.- �-� '�-� �-�� -� ~ ��-� �-� -� 1._.. l_ ��-� -� :?:T.C�.:I. �-� 'V :.J' -� -._. .:::>Pl. (l~ti,-.~ t' C� ,-. ~r-.,:,. ��I I --' �-� �' ._ �-� �._. --� �-' �._.. �-� ��-� '�- � t"li�., > V,T~ tr�l~f-.:::>f�.-��,t�;:::. <:":~.:::. n!-",;-~:�,t..;.-.1t.1-�� n���t�l~~�f- t ' �-� _, --� �-� �-� --� �-�, ._; �-� -... --� .---� �~-�(C;�C-i-�~t}t�� 1"v"a'-..;:.:-'.t.1C' :�(If"l ~.,\~7I"lT.'f c�}-l(llJl��} c-t<l1 �..! �� ... �-' .-.1. 1 In(:onw Tax t.he :-=-;�n-btnit-. ::--1� c- o� nl.- vI � (:.f it.c: qqo �� � - R~t.urn vlli~n � ~:ame - �- - -� . � � �' � -. r� (��f fBI '�=-�111�.�:�.-��::::>1.(�-!~I! rD-~. l"�t�:-;�.�,.�.�.��,��-�����t"<-"l�C-�.') �'-=''1-1�~~�-.-' t"!ll.t�-t�t:-:".-("-'�1.+ tJ-_.J ~,�l t�t ����t"t�I�l..:� H-1.,:,. �"l<"�(�JJ �-I-..:.fltc l._.. �-' rl'")�:I-:..I, �' ���� '!I ._..... ��-� '-.. -�' �-� .L L ��-�- _._: \ On the rn::1.t.t.o&r of the refund sou.Qlit. for in tlte ::J.rn�)Unt of =-~ �:.ltl"t'.)])�-;f�l 1-�,c�C� 1 tl}?t. 1) ... J' f:,(�,.::� (1(1 i t .�::i:�>t�r��-.rr-�-�.�.�-:�:c:...~. if"�C-�� .�. =:1. -� r--�����,-�.:-.� t1-.� t1�-�� ()!}�-~� f- ,_,_ -� -._. -�6 l�r-�- �C-��J-l��!�t-~�-t��,c��,-�,.�__l.,. c~�. ~--� �-'�-� � ) �' ��-� ��-� ( ) . �-�� �-� .z .... :_ �

DECISIOB- C.T .A. CASE RO. )099 -5- in 1992, tried to credit sa.id arnount of P lf\.60{i.OO Vlitll it<:; credit:dAe v'lithh(:.lding tax f()r 1992 in the a.rnou.nt of P6.500.00. T.�-:L�:..~. F.'t--?t.llJ�!�1. EH--i~,1-�,.�.:.t..�_:�..Lc� �c-��}-L,.-.,U1,�.-�1 1.����.�;-::�. H1-.�3- .�,...-1;�:-:�. ~.--.�,-I-l t,l�L"' !H--._�:l.J�1r~ (.1��[ ��,, 1.1-f ,..��11�t.�.�..�<�::.t-. t-1��!1l0::� .,,-. ���r�;::.,.�JI�t tl� � � ��r�� ��1� t::t�"" t-l�-!d~.t-� �-� 11:::' �:1. I!'-��.�!1-�1t1-r�.. !._) ,r-,�..:�::,.c)-, tri�-~��=�-.).�.(_'J(�-) �.-:�-t�.i:~.lllt��)�!�:;�:' ��-:.~r--�'f--�lli�;�:-:�.'���-I �:>..:> ��-:~. -�-�..::.. --� v �- -� t�-��~-j the succeeding tax::Jble vear. Ho~~1ever.. p:etit.ioner failed to :_1 I not the sarne has :::v~tua11y been applied as a t:~.x credit in its itKome t:J.x li::.t.bility for the year 199.3 or ~Nhether it suffered a ���1,.-;c�-=: f..-�.r tlpt �~��_r._.��-���.�c-:�'q- .t.&1. 1 P- ~l.��...c.::_.�.qr . This document is vita.! i�:::.r t11e resolution �' v���1� 1n..;:�:-�.t.l..t.1.�,�..-�,1-it~?t�'c._-. ~�-���l�C=.'."t�r1--1 !������.1� 1� t�.:'�::�:.t-1�1.1-Lrl 1�l��:J ~�,11.!1'b' . -1 (-,~1r) t.r.-:�:;.._ t-<���1-� J-J��c-;'�:�:�. t�-l�-L;::. r�;..:.:.tllf~?('..l+~I:'r �'.1}- (:arrv' -over. As '�"le ll=J.ve ruled in our Resolution. dated October . 2 1, 199.1. in a Motion for Reconsideration presented by the Cor.cunissioner of Internal Revenue in the case of Paseo Realty Development Corporation v. Commissioner of Internal Revenue. CTA Case No. 4693, pertinent porti~)n of r.,.vhich are "/�, r-:�unctilious ::Jud'v of t.11e case at ba.r.. reveais that ind-?.ed U1ere is a c:ltt:::;e t(:. reconsider Our previous Decision. 'vVe have overloot.ed the fa.ct that petith::.ner's 19(:i9 Corporate Inu)me Tax Return (EYJl. A) indicated tJ1a.t the amount of P54, 104.00 subjed of petitioner's claim for refund has already been included as p;:J.rt and parcel c�f the J? 172,477.00 V�lhi(h the petition.:-r aut~)matically applied as ta.x credit for the :::ucceeding taxable year 1990. Note should be taken that the a.mount of p~.4 104 ()() � i-=�--' ;-:�'jlfP..?- �!.(l ~/T part and parcel (1f -�� .I �- - tLJ.0."''-'-'

DECISIOH- C.T.A. CASE MO. )099 -6 - no alreadv 1 whid�� '7} 4'7'7 1:::. - I - } ..... ' f � " ~ � � ... L In-r~.c.. ;-H-t� r�.1D!..t. ..iv~-l'l! '1W-l�c-; ' applied as tax credit to the suc(:eeding taxable year 1990 Su(:h presu.mption. of course. could have been overturned had the petitioner su.brnitted its 1990 Corporate Income Tax Return showing tlla.t it rJid not ;3_utonB.tic::lllv t.:rHlit the ~;aid a.mount f�.)r tlie said taxable vea.r' 1qqo_ Uniortmla.tel'l. p�etitioner failed r -- 1 �� t..-) submit that vital document ~Nhich (:OUld have unloo:::l(.e(l his entitlement f(;.f tlH~ elusive daim for refund souQ1_,�ht for. Fai11_1.re on the 11-:>art of thE> petitioner tx) sust:lin lus dairn is fat:;J to its Gause iroe1f1uovn..rdim_�-r�artehe time-tested doctrine t11at I claim:::; for .::onstrue(l strictlv against daimant �-� (Commissioner of Internal Revenue vs. Ledesma, G.R. No. L-17509. January 30. 1970. 31 SCRA 95). r .. R. �-� ;:. tr� t��TT 1,/o. ,-. l '��~����-�r' �t�f�-~�r�"-��.t.� l~T 1r-)1�-1t... -�' tll-~~� ~r-nr�-�-�.l. tlr�l-~t�-�-11:., .._J 0C~"f:":t".t�lt. -::: petitioner's refund despite tlle fact that said amount v..ras applied as tax credit by petitioner in tlw taxable v' e;3_r 19Q-O.. is detrimental tl.) tlle interest of t11e tr, r.~J..�--�l~lTe-.:_..rr�lr�r�le�._:..t�tt-� �-----1�=,--. t-t��1~e�-:-.� �._=.;�;,�.!",'t�I�I�-~� 1-�c--' t-"~--.'1.t�lt--'-"~---'.t�I!�. ��-r� i-l�ltlt.... -��-� 2i:j:�r��a�-t�tt1..�rJ�. l,-;.:-:, petitkmer tv-lice the refund ~)f tlle same atm:mnt." In ::t. more recent case dedded by the Court oi Appeals, it ��a is incumbent upon the petiticiner t(i sllo~hT proof U1at it l1as not credited to its 1990 Annual Income Tax Return, the amount of F�297,492.00 F' 11"/ 1 r-r, -:�.;:- tn il.!"1("11Vli"t-li=1 nnl l"t�=- ---=- ~q '1..1 _. .l -� 0 1-~rnt~ . �-� �-� �� , ,:. �-� t,;;.._� ~--- ��-� !n�r'�~~�-T�l�'I.--...,. n�-- !, .... -- �- �-� -- �-��-� dedan.l.th:m in tile 19<39 Income Tax Return that tlH sr1id P2 Q7 4(J2 oo (�inc-:ludin2,_�t P 112 4q l oo) v..rill b~ -� - -� J - �� � I �� � � � - ��::�>.rn-�nr1-�1�,::�,-.�-��-1 �--~-t��-=�� ��:-1� t�--�:-:-1�y~ .�--���r,.:,:,�.��it"t~ 1�1�1 t-l��I,:�:-,- ��=--�J--lf�Y-� �-'�,:�-:�,,,.::,�-.-�lt.tlca� T>r<�,:.>��::\>r� ...-,,r� 1990. Having failed t() submit such requirement. there is no basis t!) 0arant tlie claim for refund. xxx." (BPI Family Savings Bank, Inc .� vs. Hon. Court of Tax Appeals. and Commissioner of Internal Revenue, CA-G.R. SP No. 34240, March 31, 1995~ Petitioner�~:; f'...'lotion for Reconsideration Vola~:;

DECISIOH- C.T.A. CASE HO. 5099 -7 - denied by the Court of J.LJ..ppe::1ls in a Resolution. da.t.ed �rr~ove.r.n1::.e.r �.�), , : - _ __ l(~J(�,.t:_..�� ). Thus. the Court Ulnnot l)e left t(:. speculate as to 'qhether credited or not to the succeeding taxable year ( 199_3.). For if so, then the amount of P U}.60;}00 c:::HU10t be granted in favor of petitioner F:3.ilure on the p::).rt. of the taxpayer to su.st:1.in hi:; claim i:; L1.tal to its c::tuse of action. T:::txe:::: are presumed to have been collected in ;;:l_ccordance Vv'"ith lavls a.nd regulations. (Caltex (PhiL) Inc. v. Commissioner of Internal Revenue. CTA Case No. 2871, January 29, 1986.1 A refund partakes of tl1e nature of an exernption.. and the sa.me are construed strictly again:;t t11e claimants. (Commissioner of Internal Revenue v. Ledesma. 31 SCRA 95J WHEREFORE, in vievl of the foregoing_. the petition is hereby DISMISSED for insufficiency of evidence. Accordingly, petitioner':; claim for refund is hereby DENIED.. v~~"it11out. speci:::tl SO ORDERED. i(J.�.s. �.�l.

DECISIOH- C.T.A. CASE HO. 5099 -8 - WE CONCUR: c;L~(Q~ ERNESTO D. ACOSTA Presiding Judge ~<:4.~ MANUEL K. GRUBA A::;<;cc,.j;.:tte Judge CERTIFICATION '! h>:>rebv certifv tllat. this decision Vla::: re::J.ched :3.fter due' consu.lt3.tion ::;.mong the members of the Court of T::u~ Appeals in ac(:ordance w1th Se(:tion 1J. iH"tide VI II of the Constitution. ~Q'-~ ERNESTO D. ACOSTA Presiding Judge (.(:ru.rt c�f T:;.x Appeals