PHILIPPINE ASSOCIATED SMELTING AND REFINING (PASAR) CORPORATION v. COMMISSIONER OF CUSTOMS AND THE BUREAU OF CUSTOMS

Republic of the Philippines COURT OF TAX APPEALS Quezon City En Bane PHILIPPINE ASSOCIATED CTA EB No. 1172 SMELTING AND REFINING (PASAR) CORPORATION, (CTA Case No. 8404) P e t i t i o n e r, Pre se nt : -versus- DEL ROSARIO, Pj, CASTANEDA, JR., BAUTISTA, UY, CASANOVA, FABON-VICTORINO, MINDARO-GRULLA, COTANGCO-MANALASTAS, and RINGPIS-LIBAN,Jl COMMISSIONER OF CUSTOMS Promulgated: and the BUREAU OF CUSTOMS, SEP 04 2015 -CJI1=- r ./.h"- Respondents. X-- - - -- - - - - -- - -- - -- - - - - -- - -- -- - - - - - - -- c3-.~c2:a - X & - - - - DECISION CASANOVA,.L.: This is an appeal, via a Petition for Review 1, fil ed by petitioner Philippine Associated Smelting and Refining (PASAR) Corporation assailing the Resolution2 and Decision3 promulgated on April 30, 2014 and February 20, 2014, respectively, by the Court of Tax Appeals (CTA) Third Division which denied PASAR Corporation's cla im for refund in the amount of PS,145,573.38, allegedly representing the duties and taxes it paid on its purchases of petrole um products during the period Janua ry to Septe mber of 2009, for ins uffi ciency of evid en ce.~ 1 CTA En Bane Ro llo, pp . 4 -15 z Divis ion Docket (Vol. II), p p. 611-614 3 Divis ion Docket (Vol. II), pp. 568-586

DECISION CTA EB No. 1172 (CTA Case No. 8404) Page 2 of16 Petitioner is a Philippine corporation engaged in the production of copper and its by-products for export, with plants and principal office at Leyte Industrial Development Estate (LIDE) Isabel, Leyte, a Special Export Processing Zone established pursuant to Presidential Decree (P.O.) No. 66, as amended, and Executive Order (E.O.) No. 567 dated November 13, 1979. As a registered Zone Export Enterprise with the Export Processing Zone (EPZA), it was issued a Certificate of Registration No. 82-40 dated September 23, 1982. 4 It may be served with judicial processes through its counsel at Unit 505, K Tower, 100 Kamias Road, Quezon City.s Respondent-Commissioner of Customs (COC) is the head of respondent Bureau of Customs (BOC), the government agency charged with the responsibility to collect duties and taxes from importation, with principal office at Port Area, South Harbor, Manila.6 They may be served with court processes through their statutory counsel-the Office of Solicitor General (OSG) at 134 Amorsolo Street, Legaspi Village, Makati City. The facts of the case, as found by the CTA Third Division, are as follows: 7 "Petitioner avers that it uses for its operations petroleum products such as industrial diesel oil (!DO), automotive diesel (ADO), diesel, bunker fuel oil (BFO) or industrial fuel oil (IFO) and lubricants purchased from local distributors like Petron Corporation (Petron). Petron imports these petroleum products and pays the corresponding customs duties to the BOC and excise taxes to the Bureau of Internal Revenue (BIR). Petron, in turn, bills petitioner the duties it paid on the petroleum products. For purchases of petroleum products during the period January 2009 to September 2009, Petron billed petitioner the duties paid to the BOC in the total amount of Five Million One Hundred Forty-Five Thousand Five ..... Hundred Seventy-Three Pesos and 38/100 (P5,145,573.38). � Par. 2, Decision, Division Docket (Vol. II), pp. 568-569 s The Parties, Petition for Review, CTA En Bane Rollo, p. 4 6 Par. 3, Decision, Division Docket (Vol. II), pp. 569 7 Par. 4-32, Decision, Division Docket (Vol. II), pp. 569-574

DECISION CTA EB No.1172 (CTA Case No. 8404) Page 3 of16 On January 29, 2010, petitioner filed with the District Collector of the Port of Manila (POM) a claim for refund or issuance of tax credit certificate (TCC) in the amount of P5,145,573.38, representing customs duties it paid on petroleum products purchased from Petron Corporation from January 2009 to September 2009. This claim for refundjTCC was however denied in the Memorandum dated November 17, 2010. Petitioner challenged such denial in a letter dated December 9, 2010 before then BOC Commissioner Angelita Alvarez, who endorsed the incident to the District Collector of the POM for comment with instruction to submit the entire docket of the claim. On December 30, 2010, the District Collector of the POM forwarded to the office of the COC a Memorandum dated December 20, 2010 by the Officer-in-Charge, Law Division, recommending the denial of petitioner's claim for refund with finality. In view of the said recommendation, the Deputy Commissioner for Revenue Collection returned the Resolution of the Tax Credit Committee to the Tax Credit Secretariat on April19, 2011 for endorsement to the Ruling and Research Division of the Legal Division. On June 27, 2011, the Ruling and Research Division of the Legal Division forwarded petitioner's claim for refundjTCC to the Legal Service for referral to the appellate division of the Legal Service. On November 28, 2011, the POM received the COC's 1st Endorsement dated November 25,2011 for the dismissal of petitioner's appeal. On December 2, 2011, petitioner received a copy of the Notice of Decision dated November 29, 2011, dismissing its appeal for failure to perfect the same within the reglementary period. Hence, the instant Petition for Review filed on December 29, 2011._...

DECISION CTA EB No. 1172 (CTA Case No. 8404) Page 4 of16 On February 22, 2012, respondents COC and BOC filed their Comment, with the following arguments: I. Petitioner failed to perfect its appeal within the reglementary period. II. Respondents did not violate petitioner's right to due process and equal protection of laws. III. In any case, petitioner failed to prove its claim for refund. On March 14, 2012, petitioner filed a Reply (To Respondent's Comment) arguing that its action is an ordinary claim for refund of payments of tax and duties and not a protest, thus, compliance with Sections 2313 and 2308 of the Tariff and Customs Code of the Philippines (TCCP) is not required. Further, petitioner was denied due process as its claim for refund was acted upon or denied after twenty three (23) months on the ground that it was not perfected within the reglementary period. To substantiate its allegations, petitioner presented Attorney Gil Valera, Shermila J. Yasay, Emilio Jacinto and Alfredo Palma. In his Judicial Affidavit, Attorney Gil A. Valera, declared that he was petitioner's Tax Counsel since 2007 and had represented petitioner in its claim for refunds of indirectly paid customs duties. Allegedly, petitioner's previous claim for refund dated July 25, 2007, in the amount of P3,795,019.31 representing the duties it paid for its purchase of petroleum products from Petron for the period October to December 2006 was granted by the District Collector of the POM and the Tax Credit Committee on October 30, 2007. Consequently, Tax Credit Certificate No. 000358 was issued in favor of petitioner.,_

DECISION CTA EB No. 1172 (CTA Case No. 8404) Page 5 of16 On January 25, 2010, petitioner filed the subject claim for refund in the amount of P5,145,573.38, representing customs duties on petroleum products it purchased from Petron covering the period January to September 2009. This was however denied on November 17, 2010 on the ground that petitioner failed to establish that such claim represents the proportionate amount of the customs duties and taxes paid by Petron on the importation of Arab Light and/or Super Arab Light The said Decision did not contain a computation of the proportionate amount of customs duties that petitioner was entitled to claim. On December 9, 2010, petitioner appealed to the COC, who endorsed it to the District Collector of the POM on December 12, 2010 with the instruction to submit to the Tax Credit Committee the entire docket of case as well as the corresponding comment/opposition thereto within five (5) days from notice. On December 30, 2010, the District Collector of the POM interposed his objection to petitioner's appeal citing petitioner's failure to appeal within the reglementary period of fifteen (15) days and to pay the P3,000.00 processing fee as additional grounds. On January 18, 2011, petitioner paid the processing fee of P3,000.00 required under Customs Administrative Order (CAO) No. 2-2001. On November 25, 2011, the COC denied petitioner's claim for refund. Petitioner's Vice President (VP) for Finance, Shermila J. Yasay also executed a Judicial Affidavit in which she alleged that as petitioner's VP for Finance, she oversees its financial affairs, prepares its annual budget, and monitors claim for refund it filed with the BOC. She explained that part of Petron's selling price of petroleum products constitutes the proportionate amount of duties and taxes paid on its importation of crude oil. Petitioner's claim for refund of such indirectly paid customs duties is authorized under the Philippines Export Zone Authority (PEZA) Law as incentives to PEZA locators like petitioner. The amount for refund is computed based on the Certification issued by Petron indicating the duties it passed.-.-

DECISION CTA EB No. 1172 (CTA Case No. 8404) Page 6 of16 on to petitioner for its purchase of bunker fuel oil and diesel fuel oil. She claims that petitioner's previous claim for refund was processed and approved within 60 days in accordance with Section 106(e) of the TCCP as it was found to be in order and supported by Petron's Certification indicating the correct computations of the proportionate amount of duties upon which the refund was based. Petitioner requests for this certification for every purchase made with Petron. She confirmed that petitioner filed another claim for refund for P5,144,573.38, representing the customs duties it indirectly paid to Petron for its purchases from January to September 2009 but the same was denied by respondents. When confronted, the witness admitted that the subject Certification from Petron refers to the amount of customs duties and taxes that Petron paid for the importation of crude oil or Arab Light but petitioner actually purchased bunker fuel and the diesel fuel. In any event, incorporated in the purchase price paid by petitioner were the duties and taxes paid by Petron for its importation. The first claim for refund was immediately acted upon by respondents unlike the second which was denied after ten (10) months from its filing in violation of the law. Petitioner's motion for reconsideration was likewise denied. Petitioner's third witness Emilio L. Jacinto, the Chief Accountant of BOC admitted that as a member of the Tax Credit Committee, he prepares the computation or summary of refund applications as what he did in the case of petitioner which had a total claim of P5,145,574.49. However, he was not aware that petitioner's claim was denied, for which he was not consulted by the District Collector of the POM. Processing of claims is among the functions of TCC Secretariat. His computations are based on the rate of the Industry Technology Development Institute (lTD!) and the standard output per barrels. He prepares a computation to determine the correctness of the amount subject of the claim and not to ascertain the entitlement of the claimant t~

DECISION CTA EB No. 1172 (CTA Case No. 8404) Page 7 of16 a refund. In any event, his computation is not binding upon the person who issued the ruling. He believes that petitioner is entitled to the subject refund as it is supported by the Computation of Drawback Claims from January to September 2009. Petitioner's last witness Alfredo Palma testified that his Second Endorsement dated February 18, 2011 stating that the amount of PS,145,573.38 subject of the instant claim for refundjTCC was correct based on the attached documents and computations, which he sent to the TCC Committee. However, he was unaware of what occurred thereafter. In the Manifestation and Motion dated July 16, 2013, respondents stated that it was unnecessary to present countervailing evidence." (Citations Omitted) Chiefly relying on the case of Commissioner of Customs vs. Philippine Phosphate Fertilizer Corporatione, the CTA Third Division promulgated a Decision9 on February 20, 2014, categorically ruling that, petitioner, being a duly registered Zone Export Enterprise with the Export Processing Zone Authority (EPZA), is not subject to customs and internal revenue laws and regulations or local tax ordinances. Nonetheless, the Court a quo still denied petitioner's claim rationalizing that while there exists no issue as to the legal basis of the refund claim as admitted by both parties, record shows that petitioner failed to present documentary evidence to substantiate its claim. The dispositive portion of the assailed Decision reads as follows: "WHEREFORE, the instant Petition for Review dated December 29, 2011, is hereby DENIED for insufficiency of evidence. SO ORDERED." On March 7, 2014, petitioner filed a Motion for Reconsideration10, -- praying that the above Decision be reconsidered and set aside, and its a G.R. No. 144440, September 1, 2004 � Supra No.3 1o Division Docket (Vol. II), pp. 587-591

DECISION CTA EB No. 1172 (CTA Case No. 8404) Page 8 of16 claim be remanded to the Office of the Commissioner of Customs for the determination of petitioner's entitlement to the claim sought. Petitioner's counsel, Atty. Gil A. Valera, cited a similar case he is currently handling entitled Dole Phils. vs. Commissioner of Customs and the Bureau of Customs, CTA Case No. 8409 (now En Bane No. 1142), December 18, 2013, in which the CTA First Division granted its Petition for Review and remanded the case to the Office of the Commissioner of Customs for proper determination of Dole Phils. 's claim for refund. On April 30, 2014, the CTA Third Division promulgated a Resolution11 denying petitioner's Motion for lack of merit. Undaunted, petitioner filed the instant Petition for Reviewlz with the Court En Bane on June 3, 2014. However, in the July 17, 2014 ResolutionB, the Court En Bane observed that counsel for petitioner failed to indicate his Integrated Bar of the Philippines (IBP) Membership No. and to present the authority of Atty. Danilo C. Perolino, Assistant Vice President of PASAR Corporation, to represent petitioner and to file the instant Petition for Review. On October 3, 2014, petitioner's counsel filed a Compliance 14, indicating therein his IBP Lifetime Member No., also, attaching therewith a copy of his IBP Membership Identification Card15, an Authorization16 from Mr. Adam David Purkis, the President of PASAR Corporation, and petitioner's Secretary's Certificate17 authorizing Atty. Danilo C. Perolino to represent petitioner in the filing of the instant Petition. Thereafter, on October 21, 2014, the Court En Bane issued a Resolution18 ordering respondents to file their Comment to the Petition for Review within ten (10) days from receipt thereof~ 11 Supra No. 2 12 Supra No. 1 13 CTA En Bane Rollo, pp. 48-51 14 CTA En Bane Rollo, pp. 57-58 1s Annex "A" of the Compliance, CTA En Bane Rollo, p. 59 16 Annex "B" of the Compliance, CTA En Bane Rollo, p. 60 17 Annex "C" of the Compliance, CTA En Bane Rollo, pp. 61-62 1a Ibid., pp. 64-65

DECISION CTA EB No. 1172 (CTA Case No. 8404) Page 9 of16 On December 11, 2014, respondents filed, through registered mail, their Comment19. Finding respondents' Comment to be insufficient in number of copies as required under Administrative Memorandum No. 11-9-4-SC, the Court En Bane, on January 5, 2015, issued a Minute Resolution20 ordering respondents to submit additional copies thereof. Thus, in view of the Court's directive, respondents filed, on January 23, 2015, through registered mail, a Compliance submitting therewith nine (9) additional copies of their Comment dated December 10, 2014. Finding everything in order, the Court En Bane, in the Resolution dated February 12, 2015, deemed the instant Petition for Review submitted for decision. Petitioner raised this sole issue21 in its Petition for Review, to wit: Whether or not the CTA 3rct Division was correct in denying PASAR's claim for refund for failing to submit documentary evidence to support its claim of refund of Php5,145,5 73.38. Considering that there are no legal issues in the instant appeal, the crux of the controversy essentially boils down to a case of substantiation. After careful scrutiny of the records of the case, We find no merit in the instant Petition for Review. In the instant appeal, petitioner primarily based its argument on the Memorandum22 for the District Collector of the Port of Manila by Atty. Florante C. Macarilay, Hearing/Legal Officer, dated November 17, 2010, wherein the latter admitted that petitioner had submitted numerous documents in support of its claim. Hence, petitioner strongly believes to have sufficiently proven its entitlement to the claim for refund sought. Furthermore, as to the Court's finding that petitioner failed to present sufficient documentary evidence to substantiate its claim, petitioner asserted that the reason why the Court a quo found its evidence insufficient was because respondents COC and BOC failed to-e.. 19 ld., pp. 69-78 zo As per En Bane Resolution No. 09-2010/04-2012, as Amended by En Bane Resolution Nos. 01-2013,02-2013, 05-2013, and A.M. No. 11-9-4 SC 21 Issue, Petition for Review, CTA En Bane Rollo, p. 8 22 Exhibit "D" for the petitioner, Division Docket (Vol. 1), pp. 359-366

DECISION CTA EB No. 1172 (CTA Case No. 8404) Page 10 of16 comply with the Court's directive during the hearing conducted on June 5, 2012, wherein respondents were ordered to transmit to the Court the original records of the case from respondent BOC. However, We are not persuaded. An administrative claim for refund with the District Collector of the Port of Manila is different from a judicial claim for refund with the Court. The burden of proving its entitlement to the amount claimed for refund falls heavily with the claimant. It carries that not only was the claimant entitled under substantive law for the allowance of its claim for refund, but also that it met all the requirements for evidentiary substantiation of its claim before the administrative official concerned, and, thereafter, in the trial conducted before the Court. The Court of Tax Appeals, as a court of record, is required to conduct a formal trial of each and every case before it. Pieces of evidence submitted in the administrative proceeding have no evidentiary value unless presented and formally offered before the Court.23 Based on the evidence admitted during trial,24 petitioner was considered to have only offered the following documents in support of its claim, to wit: Exhibit Nature Purpose A PASAR's Letter To prove that, previously, PASAR refund had c claim of refund claims simply supported by Certifications dated July 25, 2007 from Petron of the amount of duties passed D on to PASAR and that BOC did not collect any PASAR's letter claim processing or docket fee. of refund dated To prove that PASAR continued to support January 25, 2010 its duty refund applications with simply Memorandum Certifications from Petron of the duties passed on by Petron to PASAR. Decision of the POM To prove that just at the level of the POM District Collector District Collector, it took the new BOC POM District Officials 311 long days to conclude dated November 17, that "PASAR miserably failed to establish 2010 but received that the instant claim represents the proportionate amount of the customs duties byPASARon and taxes paid by Petron on the importation December 2, 2010 of Arab Light, which was actually used in the 23 Phil. Gold Processing and Refining Corp vs. Commissioner of Internal Revenue, CTA Case No. 8301, February 27, 2014 z� As per Resolution dated November 9, 2012, Division Docket (Vol. 1), pp. 466-467

DECISION CTA EB No. 1172 (CTA Case No. 8404) manufacture of Bunker Fuel Oil which was subsequently delivered to PASAR". To prove that the POM District Officials all lawyers - Attys. Macarilay, Turingan III and Bauzon did not consult with BOC's accounting officials Alfredo Palma and Emilio jacinto to check if PASAR's refund claim amount is correct and proportionately computed. To prove that within 7 days from receipt of Appeal letter dated the Denial Decision of the POM District Dec. 9, 2010 of Collector, PASAR was able to file its appeal to PASAR to BOC the BOC Commissioner, a copy of which was E Commissioner duly furnished to the POM District Collector furnishing a copy to To prove that the Office of the BOC the POM District Commissioner received PASAR's Appeal Collector without requiring the payment of Php3,000 processing fee. To prove that then BOC Commissioner 1st Indorsement Angelita A. Alvarez immediately acted on PASAR's Appeal copy furnishing Atty. Gil F dated Dec. 12, 2010 Valera, counsel of PASAR who was not of respondent COC required by the BOC Commissioner to pay the Php3,000 processing fee. BOC Official Receipt To prove that upon the advice of Atty. Liza G No. 0185230886 Sebastian Torres of the TCC Secretariat dated January 18, sometime in january, 2011 PASAR paid Php3,000 processing fee. 2011 To prove that even in the CAO 2-2001, there is no period of time indicated when to pay G-1 CAO Administrative the Processing fee. Order 2-2001 To prove that in CAO 2-2001, there is no penalty provision in case of delayed payment of the "customs fees and charges." Summary of To prove that Alfredo A. Palma, CPA made PASAR's Refund of computations to check the accuracy of the Duties on Petroleum amount being claimed by PASAR. 1-1 Products purchased To prove that the POM District Officials did from Petron not first consult CPA Alfredo Palma when covering period Jan. they concluded that PASAR's claim did not to Sept., 2009 represent the proportionate amount. To prove that CPA Emilio L. jacinto, Chief Summary of Refund Accountant of the Revenue Accounting J Claim PASAR Jan. to Division of BOC also computed to check the Sept.,2009 accuracy and the proportionality of the amount being claimed by Dole and just like

DECISION CTA EB No. 1172 (CTA Case No. 8404) Page 12 of16 CPA Alfredo Palma, he found the claim of PASAR to be correct and proportionate. To prove that CPA Emilio jacinto Chief J-1 to Computation of Accountant of the Revenue Accounting Drawback Claims of Division of BOC also computed to check the PASAR from Jan. to accuracy and proportionality of the amount being claimed by PASAR and just like CPA Sept.,2009 Alfredo Palma, he found the claim of PASAR J-9 prepared by CPA to be correct and proportionate. Emilio Jacinto, Chief To prove that POM District Officials did not first consult with BOC Accounting Officials Accountant of Revenue Accounting when they concluded that PASAR's claim did not represent the proportionate amount. To prove that it took the BOC Commissioner 351 days to decide on PASAR's appeal or a total of 662 days from the time PASAR filed its claim on january 25, 2010 versus the 60 Denial Decision of days required by Section 106(e) of the TCCP. BOC Commissioner 0 Rozzano Rufino To prove that the Denial Decision of BOC Biazon on Comm. Biazon did not even mention the November 25, 2011 Certifications made by CPAs Palma and jacinto unlike in the Decision of BOC Comm. Alvarez who relied on the Certification of CPA jacinto in approving the refund claim of Peza Locator Pan Century Surfactants. To prove the truthfulness of the contents of the judicial Affidavit of Atty. Gil A. Valera and that the dismissal of PASAR's Claim for Refund due to non-perfection of the appeal violate the substantive due process and Judicial Affidavit of equal protection rights of PASAR considering p Gil A. Valera, Tax the leading cases of Customs Commissioner Counsel of PASAR vs Philphos, GR No. 1440, September 1, 2004 (the PEZA locator claimant has 6 years to claim his wrongfully paid customs duties under the principle of solution indebiti) and BPI vs. CTA 330 SCRA 507 and Article 19 of the Civil Code To prove the material allegations of the judicial Affidavit of Shermila Yasay, VP Finance of PASAR, that PASAR has secured their refund claims fast but in this case, has Q Judicial Affidavit of been decided by BOC only after 662 days. Shermila Yasay To prove that in the past, the Certifications from Petron of the proportionality of the amount of the refund claim served as the basis for previous BOC officials to grant the refund claim of PASAR. L______L________________~~~~~~~~~~--------------~~

DECISION CTA EB No. 1172 (CTA Case No. 8404) Page 13 of16 Clearly, petitioner failed to prove its claim for refund. While the evidentiary documents above show that petitioner indeed has a claim for refund they, nonetheless, fail to prove how much of the claimed amount is petitioner entitled to. As correctly held by the Court a quo in its Decision, "Petitioner only presented the Summary of Refund of Customs Duties on Petroleum Products purchased from Petron covering the period ofjanuary to September 2009 made by Alfredo A. Palma and Emilio L. jacinto, Chief Accountants of the Revenue Accounting Division, and the Computation of Drawback Claims from january to September 2009 prepared by Emilio jacinto. But sans documents substantiating the entries in the said summaries and computations, there is no way to verify the veracity and correctness of the amounts reflected therein." (Citations omitted and Underscoring supplied) It cannot be gainsaid that a judicial claim for tax refund or credit brought to the CTA is by no means an original action but an appeal by way of a petition for review of the taxpayer's unsuccessful administrative claim; hence, the taxpayer has to convince the CTA that the quasi-judicial agency a quo should not have denied the claim, and to do so the taxpayer should prove every minute aspect of its case by presenting, formally offering and submitting its evidence to the CTA, including whatever was required for the successful prosecution of the administrative claim as the means of demonstrating to the CTA that its administrative claim should have been granted in the first place.25 Needless to say, a just and impartial decision fundamentally requires evidentiary facts from which a principle of Jaw may be based. Lastly, citing the case of Dole Phils. vs. Commissioner of Customs and the Bureau ofCustoms, petitioner argues that since the former case is identical to the instant case, the latter case should be remanded to the Bureau of Customs for the proper determination of the refundable amount just like what was held by the CTA First Division in the Dole Phils. case. Again, We are not convinced. The Court is well capable of deciding cases elevated to it within its jurisdiction. As stated by the Supreme Court, "x x x by the very nature c... 25 Luzon Hydro Corporation vs. Commissioner of Internal Revenue, G.R. No. 188260, November 13, 2013; See also Commissioner of Internal Revenue vs. Philippine National Bank, G.R. No. 180290, September 29, 2014; Kepco Philippines Corporation vs. Commissioner of Internal Revenue, G.R. No.179356, December 14,2009

DECISION CTAEBNo.1172 (CTA Case No. 8404) Page 14 of16 of its functions, the CTA is dedicated exclusively to the resolution of tax problems and has consequently developed an expertise on the subject."26 The findings and conclusions reached by the CTA Third Division are derived depending on how the parties presented their side of the case. Parenthetically, the same goes with the CTA First Division, as well as the CTA Second Division. The Court in Divisions handle cases elevated to them independently from one another, encompassing their own perspective in the disposition of the issues raised and appreciation of the evidence presented in each case before them. Hence, the question of whether or not the evidence submitted by a party is sufficient to warrant the granting of a claim for refund, absent a showing of abuse or reckless exercise of authority, lies within the sound discretion and judgment of the Court in Division. On a final note, it is worth mentioning that based on the Petition for Reviewz7 and Memorandum of the Petitioner28 filed on December 29, 2011 and January 21, 2013, respectively, petitioner prays among others that its duty refund claim be granted and respondents be Ordered to issue a Tax Credit Certificate in the amount of PS,145,573.38. After the CTA Third Division denied its claim for insufficiency of evidence, petitioner changed its prayer in its Motion for Reconsideration29 and in the instant Petition for Review filed on March 7, 2014 and June 3, 2014, respectively, by now asking that the subject claim of PASAR be remanded to the Office of respondent COC directing the latter to make a determination of the specific amount to which PASAR is entitled to. This, We cannot allow. By submitting to this Court's jurisdiction, petitioner is bound by the conclusion reached by the Court especially if the said conclusion was based on the merits. As such, petitioner's change of prayer cannot be tolerated on appeal, not due to the strict application of procedural rules, but as a matter of fairness. Accordingly, finding no reversible error, the Court En Bane finds no cogent reason or justification to disturb the conclusions reached by the Court a quo.e. 26 Kepco Philippines Corporation vs. Commissioner of Internal Revenue, G.R. No. 179356, December 14, 2009 27 Division Docket (Vol. 1), pp. 8-37 2a Division Docket (Vol. 1), pp. 478-483 29 Division Docket (Vol. 2), pp. 587-591

DECISION CTA EB No. 1172 (CTA Case No. 8404) Page 15 of16 WHEREFORE, the instant Petition for Review is hereby DENIED for lack of merit. Accordingly, the Decision dated February 20, 2014 and Resolution dated April 30, 2014 rendered by the CTA Third Division are hereby both AFFIRMED. SO ORDERED. CAESAR~ANOVA Associate Justice WE CONCUR: Presiding Justice ~ .......:>b (2. cy-....._.~ I 5J_ ' ~,C/.~ JUANITO C. CASTANED~: JR. AMELIA R. COTANGCO-MANALASTAS Associate Justice Associate Justice .. ER~P.UY Associate Justice N P.~l.t Me~. C~ CiELITo N: MINDARO-GRULLA Associate Justice C/M. ~ _.1 L.._� MA. BELEN M. RINGPIS-LIBAN Associate Justice

DECISION CTA EB No. 1172 (CTA Case No. 8404) Page 16 of16 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 with the members of the Court En bane before the case was assigned to the writer of the opinion of the Court.

REPUBLIC OF THE PHILIPPINES Court of Tax Appeals QUEZON CITY ENBANC PHILIPPINE ASSOCIATED CTA EB N0.1172 SMELTING AND REFINING {CTA Case No. 8404) (PASAR) CORPORATION, Present: Petitioner, -versus- DEL ROSARIO, PJ, CASTANEDA, JR. BAUTISTA UY CASANOVA FABON-VICTORINO MINDARO-GRULLA COTANGCO-MANALASTAS RINGPIS-LIBAN, JJ COMMISSIONER OF CUSTOMS Promulgated: and the BUREAU OF CUSTOMS, Respondents. SEP 04 1015 X - - - - - - - - - - - - - - - - - - - - - - - - - - -, _J ~� ~/�-~ X DISSENTING OPINION DEL ROSARIO, PJ.: The ponencia of my esteemed colleague, Honorable Caesar A. Casanova, Associate Justice, sustained the Court's (Third Division) denial of peti tioner's c laim for refund due to insufficiency of evidence. The ponencia ruled that petitioner fa iled to prove the specific amount it is entitled to as petitioner presented only the following documents, namely: (i) the Summary of Refund of Customs Duties on Petroleum Products from Petron covering the period of January to September 2009 made by Alfredo A. Palma and Emilio L. Jacinto, Chief Accountants of the Revenue Accounting Division, and (ii) the Computation of Drawback Claims from January to September 2009 prepared by Emilio Jacinto, sans documents substant iating the entries in the said summaries and computations. Consequently, the veracity and cotTectness of the amounts reflected therein cannot be verified. With utmost respect, it is my humble view that the appealed claim for refund was duly substantiated by the required quantum of evidence. Truth to

Dissenting Opinion Philippine Associated Smelting and Refining (PASAR) Corporation vs. Commissioner of Customs and the Bureau ofCustoms, CTA EB No. 1172 (CTA Case No. 8404) Page 2 of3 tell, a claim for tax refund necessitates only preponderance of evidence for its approbation like in any other ordinary civil case.' Records disclose that the documents described as Summary ofRefund Claim and Computation of Drawback Claims of PASAR from January to September 2009, marked as Exhibits "J", J-1" to "J-9" were offered by petitioner as its documentary evidence. The said exhibits show the following amounts for refund, as computed by Emilio L. Jacinto, Chief of Revenue Accounting Division ofthe Bureau ofCustoms, to wit: Volume Volume R"w of Products of Products IEIRD Product Exported/ltrs Exportedlbbls lTD! Material Allocated No Description Exhibit Rate Used Cost(mt) For Refund J-1 93377006 ADO 0_05%S 1.97482 p 13,474.05 J-2 Jan-09 64,000 402.55 5 90% 6,822.94 J-3 Feb-09 4.48182 38,224.01 J-4 Mar-09 94028076 ADO Q_05%S 80,000 503,19 5.90% 8,528.68 4.68337 52,924.41 5.13170 42,672.44 Apr-09 94964283 ADO 0.05%S 106,000 666.73 5,90% 11,300.50 21.56183 733,812.77 5.13170 181,651.65 ADO 0.05%S 78,000 490.61 5.90% 8,315 46 4.02940 32,647.22 16.93033 702,610.67 94028024 Bunker Fuel Oil 1,341,320 8,436.71 24.79% 34,032.95 4.02940 107,920.96 4.02940 20,619.30 IDO 332,037 2,088.48 5.90% 35,397.96 16.93033 556,120.02 4.02940 111,425.39 J-5 ADO 0.05%$ 76,000 478.03 5.90% 8,102.24 4.48804 50,717.13 May-09 18.85739 709,576.66 96982611 Bunker Fuel Oil 1,635,619 10,287.88 24.79% 41,500.12 4.48804 118,670.91 4.37971 35,485.47 IDO 251,231 l ,580.22 5.90% 18.40220 672,346.87 26,783.35 4.37971 120,222.43 5.05009 34,456.49 J-6 ADO 0.05%S 48,000 301.92 5.90% 5,1 [7.21 21.21895 691,133.69 Jun-09 Bunker Fuel Oil 5.05009 118,861.97 96982611 2 1,294,601 8,142.91 24.79% 32,847.56 p 5,145,574.49 IDO 259,389 1,631.53 5.90% 27,653.07 J-7 ADO 0.05%$ 106,000 666.73 5.90% 11,300.50 Jul-09 97408281 Bunker Fuel Oil I ,483,032 9,328.12 24.79% 37,628.57 IDO 248,025 l ,560.05 5.90% 26,441.57 J-8 ADO 0.05%S 76,000 478.03 5.90% 8,102.24 Aug-09 97474386 Bunker Fuel Oil I ,439,980 9,057.33 24.79% 36,536.23 IDO 257,483 [ ,619.54 5.90% 27,449.87 J-9 ADO 0.05%$ 64,000 402.55 5.90% 6,822.94 Sep-09 97474465 Bunker Fuel Oil I ,283,722 8,074.48 24.79% 32,571.53 IDO 220,776 I ,388.66 5.90% 23,536.59 As the foregoing exhibits have been duly admitted in evidence, the same should not be lightly ignored, more so since the said documentary evidence were prepared and computed by a public official, who is presumed 1 Commissioner of Internal Revenue vs. Fortune Tobacco Corporation, G.R. Nos. 167274-75, July 21,2008. 2 The IEIRD numbers for the month of May and June are the same.

Dissenting Opinion Philippine Associated Smelting and Refining (PASAR) Corporation vs. Commissioner of Customs and the Bureau ofCustoms, CTA EB No. 1172 (CTA Case No. 8404) Page 3 of3 to have regularly performed his official duty.3 The said documentary exhibits partake of the nature of a public document, being a written official act of a public officer,4 or at the very least, an official document having been prepared in the course of official duty. As an official document, the entries thereof are prima facie evidence of the facts stated therein.5 To burden petitioner with the submission of additional documents in order to substantiate the entries in the Summary of Refund Claim and Computation of Drawback Claims, would render meaningless the presumption of regularity in the performance of official duty. To be sure, while its supplier, Petron Corporation, may be in possession of copies of Import Entry Internal Revenue Declarations (IEIRDs), the Summary of Refund Claim and Computation ofDrawback Claims prepared by Emilio L. Jacinto, the Chief of Revenue Accounting Division of the Bureau of Customs, is necessarily based on the records on file with the Bureau of Customs, among which are the IEIRDs as indicated in the said Summary of Refund Claim and Computation ofDrawback Claim. Absent any showing of error or irregularity in the computation, Emilio L. Jacinto's determination, in the exercise ofhis official duty, deserves weight and respect. In fine, the computed amounts of refund in the documents captioned as Summary of Refund Claim and Computation of Drawback Claims sufficiently confirm petitioner is entitled to its claim in the total amount of P5, 145,573.38. IN VIEW OF THE FOREGOING, I vote to GRANT the Petition for Review. Respondents Commissioner of Customs and the Bureau of Customs should accordingly be ordered to refund in favor of petitioner the amount of P5,145,573.38, representing the duties and taxes it paid on its purchases of petroleum products during the period January to September of 2009. Presiding Justice 3 Rules of Court, Rule 131, Section 3(m). 4 Sec. 19. Classes of documents. - For the purpose of their presentation in evidence, documents are either public or private. Public documents are: (a) The written official acts, or records of the official acts of the sovereign authority, official bodies and tribunals, and public officers, whether of the Philippines, or of a foreign country; xxx 5 Office of the Court Administrator vs. Bermejo, A.M. No. P-05-2004, March 14, 2008.