CTA Case No. 1944 (Decision)

st� f,ll.)"t JI'HY~ Of 'riH� rtHUP Pl ~l" ~> COUP..T Ol" TAX APPEA UJ f't~"t.'.f.tJ:t: (HT"' . ., vG REA1' P;.~.Cif' IC LH"' E A3SUlUil'.< CE CCR t:; ORt'>t' I ON , Peti�U.oner, ... v~~ r s us C. T . i\ . CASE NO. 1944 THL CU 'll � I ~~ lL'.I::F< CF' L'/1\ .:r �, ,J R L~VfTU E II Re>s ..,onll en t. X~- - - - - - - - - - - - - X D l.. C 1 ... I 0 N Th is is a n o fis h oot cf c . ~ . ~ . Case No . 1 046 ent i- tled Fili p in ~s Life As s u r ance Co mp a n y v s o Commissioner of Inter n a l Revenu e , t he deci sion on whi c h was lat ~ r aopea led t o the S upreme Court as G. R. No. L- 21258 and decided by the latter on Octob e r 31 , 1. 9 6 7 . In t ha t case t he r upr eme Cou r t ru l ed to t he ~f 1 e ct tha t d omestic and resi den~ oreign l i fe insurance comp anies a re ent i- tled to re p ort only 25% of th el r dividen i nco me as nrovided in s uhsecti . .1 ( a ) of ~ ection 24 of the Tax ~od e . Peti t i or. er i n t he ;Jrescnt: c ~, se moves fo r a s um-� mary j ur.1g.nen t to sustaj_ n i tn cla i m ior r fund o f alJ.8ged o v erpa y men t f inccme t dX in t e . ar,vu n t of ! �5 , 902 . oo for t te taxable year 1965 , a npclrc nt l on the g round that there is no long e r - ny qe nuine i ~s~e to b e r e solved . Be that u.s .i.t r'i~:, , UH= follo~.rino r e �the f a cts which - re u lleg ed in trlE' ')e titi on for r e vi ew and admit- ted in t!le u n~ �C r v r SU '1[lOr t~ ~... ) j tne GVi d e nc e , th a t g~v~ rise tv the p r e~ent c on tro v ,rsy . It anpears that petiti oner is a domestic ' life in- surnnce cornor at ion organi� e a dnrt exisLing und r the 1 aws of the Phil 1 Dines . Un ~-~p r il 5 , 1 9 66, pe�t.i ti oner 25~

OEC l .; !UN - C!��� C; �.:_.r� Nu . 1 9 44 (2) 1r fu ll the d ivi u~ nd~ it r e c Rivcd from v ariouc c o r por- a ti ~ms ('" �no u n tint.t t o l 58 , 244 . 'J~> . en wl ich 1 . pe i d ircome s. on An r il 1 ~66 ~..m dt'.lr r' ., ( . 1 o. C-477061 1 and t.l' a~ seco n d i n&ta l .~.rn eol'lt on Ju ly 1 5 , .l iJ66 u.n d f.' .r c� . r . ~''' � C-5403176 . Re l i zing thnt only 25% of th� d i vJ 1P � weo rcturn �b l e amended inc �;;o m~ tux rt..t..Jrn �, ~ r 1 9 65 dec l ~ring t � rt11in / only a taxa b lu i nc ~~ Q of P2 3. B8 4. 0G . Toget h ~r wi t h 1 96 5 in t.h fl a1auunt u ! E� S, Y .12 . CO. Jul y 31 1968 . defenses ., a l ht~e a a11.u n9 others: t h<J t ( l ) thf! tax mo ught t o b e r ft f und ed wa~ oa i ~ and c cl l ~ct ed in a ccordanc e '<-.' ith .i. i1'i' '~1 and (:. ) th ~ re-~ L~~.ing no d eci f.i i un 260

OECl~lUN - CT/1. C &F~ Nu . 1 9 4 4 (3) aa yet of re~~ond ent . ~h e filing of the oetition .o r Truly . it seems cl aar that th~re is no l ongLr any genuine ia a u~ t o be rea u lved in tha pr~ s ent co n - o r no t cnly 2 ~K of peti t i0n~r � s di v id nds from other cot: nor ation s is �t &X'ab le h <HJ lon~ ._,, e- n oec i dt'rd in a case b~ t ee n t ha a me part i~ s mntitl e d Creat Pacif ic I.. ii-o Ass urance Cornora ti o n ..,,. � Ccmmiso i c nr. r o f I n tf'rn a 1 ln r ~so lv1ng t h~ ia :!iue ~ t h:l..s Cour t in it.a dec i s i o n 11 'The cl.e11 i m f o r re f un~ o f oet 1tion e r 1m baaed o n Section 24 of th ~ Nnticna l Int e r na l evenua C0<1e �r ich p rovid~s th at ' in the cn1H~ of dividends received by ~'1 d omes tic o .r :. veuid ut f oraign cor.DOre\ tio n fr om a domes tic � cor oorati c n li able to t a x � � � only c. e nty�-f ive .2.!� � ,.nt::.l!!.!! th L' 6lOf shall bt-~ r eturnebl e o r p u rpc s~s �of the tax im!osed by this aActinn. � lt is not c ontrov e rted that petitioner i s a domeo tic cor ~)orat ion and t 1at the divi d <'!nds in ques tion wore r ce i ved by i t from oth r domestic c o rpora t ions s uojcct to tax und r the Inc ome Tax Law . Therefore~ the divi- dends receivEd by petiticnPr f rom other d om�stic corpora ticns as declared i n its orig i na l a~nd ame n dt-!d inc om� t n Y r <e tu r n~ are taxable on ly tc the e xten t of � 5% of such div i d e nds# a nd its claim of hevint marlo an t,n re rpa y me nt n u n t be su s tai ned . ( ~ ee P i li ! n as Li fe Assurance Lo . v. The Court cf Tax ,\pp �nls � .; . I< . l\ () . L-2 1 258 . Oc tober 31 � .19 67.)" As to tho all eg ~t. i on of r c rF�or we. n t tha t t .ha f filing of the p titi on for r ev i e w is p .r:�em.'i tur � it WOUld suffice to quote fr om the Ve ry G m dec isio A in t he ca � o o f Great Pa ci fic Li fe Assur dnc e co . v. 2Cl

'� O~ ClS l ON - CTA CASE NO. 1944 (.f.) u x x ~ . Howev~r8 ~here the two y~ar period ifl abo ut to 1-iil.DSG end the CommhHlicm er 1 no t 0~;;>ected ~.o renda.r a d~eis i o n on t.h t1ur ~yer ' ll claim for: r!l!tfund bef c.�:t�� C)( p i.nlt.ion of a ;aid p e riod . t htt t~x.payer t!U,Hit ''- PPt.:al to th Court ~f Tax App~als witho ut ua it i ng f 6r for~'Wlll decision ot the Corrc.mJ. a i on r, othM- r - wime, the1 t~xp.ay&r '~ right t.o the- r fund. would. bo ba� r &d.. ( Col l ectr; r v o 5weerley. 1m: rl!' Gib bo v. ol l. !ll.l.(.!!ll c ollt!cto r v. couventi 1:>n of Phil. D..3 ;:J ti~t Chu r cht"S� a . H. H e~ . L-1 1 807. J ~n . 28 , 19611 Y.oDpel v. c o ll., c . ~ . No . L-1 0550. ~~pt. 16, lU6 l)" We fincl n c valid or col:)ent. r(j!)auo n to mod ify tl\0 opirt1on .Q Od cbs ~ r�veti<:ms of. this Co u:rrt. in tho e f c .. ~- In �ifi w o f the foreGoin g . t. l o rtJlief aought by e ry j udqm12nt in h~u� eby (J r ~J! nt.ftd. Putit.ionar is entitled t o t htt r t fund of t he amount. of 41'~. 902 .oo. yecr 19 s. the r e fund to ? tlt i c ner or t Pac i fic Li !@ As murance Corporatio n, without. p rOl'l(JUncemcnt .aa t il.) coats.