CIR
GR No. 197525 / 4 Jun 2014 / J. Mendoza
FACTS
VGPC filed an administrative claim on 6 Dec 2006 for refund for about 14.2
million in unutilized input VAT payments for the four quarters of taxable year
2005, pursuant to RA 9136 that prescribed a 0% rate on sales of generated
power.
On 3 Jan 2007 while the admin claim was pending, VGPC filed its judicial
claim via a petition for review with the CTA for the same amount.
CTA division granted the refund in the amount of 7.7 million finding that this
was the only amount duly substantiated with the required evidence. Both CIR
and VGPC moved for MR (denied) and appealed.
CTA en banc reversed and dismissed the original petition for review for being
filed prematurely. It held that since the judicial claim was filed 28 days after the
petitioner filed its admin claim, without waiting for the expiration of the 120day period, it was premature and thus the CTA acquired no jurisdiction. This
cited the case of CIR v. Aichi Forging Company.
VGPC filed MR, citing Atlas Consolidated Mining v. CIR, but the CTA en banc
RATIO
There are actually two sub-issues on when judicial claims are premature.
First, on when the two-year period starts (applicability of Atlas which was later
reversed in CIR v. Mirant Pagbilao) and second, whether the 120-day period is
mandatory and jurisdictional (applicability of Aichi vs. BIR Ruling DA-489-03). In
this case, only the second issue is applicable since the claim was clearly filed
before the two year period in either case.
Key finding is when the judicial claim was filed. Since it was filed on 3 Jan
2007, BIR Ruling DA-489-03 applies, and not Aichi which only applies to judicial
claims made after 6 Oct 2010 or the promulgation of Aichi. Thus, applying the
said ruling, the taxpayer need not wait for the lapse of the 120-day period
before it could seek judicial relief with the CTA by way of Petition for Review.
The judicial claim therefore in this case was not premature.
The Court however further discussed the final rules in VAT refunds cases
1.
ii