Case Digest - Taxation
Filinvest vs. CIR/CTA
G.R. No 146941 August 9, 2007
Petitioner claimed for a refund or in the alternative, issuance of a tax credit certificate (TCC) in the amount of P 4,178,134.00 representing excess creditable withholding taxes for taxable years 1994,1995 and 1996. CTA dismissed the case for insufficiency of evidence its 1997 income tax return. CA assailed the decision of CTA and denied petition of Filinvest. The SC initially denied petition for review but on April 3, 2002, case was re-filed on a petition for reconsideration.
Whether petitioner is entitled to the tax credit anent insufficient evidence.
CA erred in ruling that petitioner failed to discharge the burden of proving that it is entitled to the refund because of the latter’s failure to attach its 1997 ITR.
It is worth nothing that under Section 230 of NIRC and Section 10 of Revenue Regulation No. 12-84, the CIR is given the power to grant a tax credit or refund even without a written claim therefore, if the former determines from the face of the return that payment had clearly been erroneously made. The CIR’s function is not merely to receive the claims for refund but it is also given the positive duty to determine the veracity of such claim.
Simply by exercising the CIR’s power to examine and verify petitioner’s claim for tax exemption are granted by law, respondent CIR could have easily verified petitioner’s claim by representing the latter’s 1997 ITR, the original of which it has in its files. Hence, under solutio indebiti, the Government has to restore to petitioners the sums representing erroneous payments of taxes.
CIR vs. Rosemarie Acosta
G.R. No. 154068 August 3, 2007
Acosta is an employee of Intel and was assigned in a foreign country. During that period Intel withheld the taxes due and remitted them to BIR. Respondent claimed overpayment of taxes and filed petition for review with CTA. CTA dismissed the petition for failure to file a written claim for refund with the CIR a condition precedent to the filing of a petition for review with the CTA. CA reversed the decision reasoning that Acosta’s filing of an amended return indicating an overpayment was sufficient compliance with the requirement of a written claim.
Whether or not CTA has jurisdiction to take cognizance of respondent’s petition for review.
A party seeking an administrative rimedy must not merely initiate the prescribed administrative procedure to obtain relie but also to pursue it to its appropriate conclusion before seeking judicial intervention in order to give administrative agency an opportunity to decide the matter itself correctly and prevent unnecessary and premature resort to court action. At the time respondent filed her amended return, the 1997, NIRC was not yet in effect, hence respondent had no reason to think that the filing of an amended return would constitute the written claim required by law.
CTA likewise stressed that even the date of filing of the Final Adjustment return was omitted, inadvertently or otherwise, by respondent in her petition for review. This is fatal to respondent’s claim, for it deprived the CTA of its jurisdiction over the subject matter of the case.
Finally, revenue statutes are substantive laws and in no sense must with that of remedial laws. Revenue laws are not intended to be liberally constructed.
Atlas Consolidated Mining vs. CIR
G.R. 145526 March 16, 2007
Petitioner presented to CIR applications for refund or tax credit of excess input taxes attributed from petitioner’s sales of gold on the theory that these were zero-related transactions under Sec 160 (6) of Tax Code 1986. CTA denied petition on grounds of prescription and insufficiency of evidence. The CTA and CA both found petitioner failed to comply with the evidentiary requirements for claims for tax refund.
Whether or not petitioner submitted sufficient evidence to justify grant of refund.
CIR approved petitioner’s applications for zero-rating of its sales of gold to some companies. It has always been ruled that those seeking tax refunds or credits bear the burden of proving factual bases of their claims and of showing that the legislative entitled them to such claims.
A photocopy of the purchase invoice or receipt evidencing the VAT paid shall be submitted together with the application for tax refund. CTA circular 1-95 likewise required submission of invoices or receipts showing the amounts of tax paid.
Both Courts correctly observed that petitioner never submitted nay of the invoices or receipts required and held this omission to be fatal to its cause. A judicial claim for refund or tax credit in CTA is by no means in original action but rather an appeal by way of petition for review of a previous unsuccessful administrative claim. Next, cases filed in CTA are litigated de novo. Thu8s, a petitioner should prove every minute aspect of its case by presenting, formally offering and submitting its evidence to the CTA.
While CTA is not governed by technical rules of evidence, as rules of procedure are not ends in themselves but are primarily intended as tools in the administration of justice, the presentation of the purchase receipts is no0t a mere procedural technically which may be disregarded considering that it is the only means by which the CTA may ascertain and verify the truth of claims.