GOLEA, Ma. Consorcia A.

2013 – 0060

CIR vs. Silicon Philippines, Inc

G.R. No. 169778 March 12, 2004

FACTS
Silicon Philippines, Inc. is a domestic corporation engaged primarily in the business of
designing, developing, manufacturing, and exporting advance and large-scale integrated circuits
components (ICs).

On 06 May 1999, Silicon filed for tax credit / refund of VAT paid for 2 nd quarter of 1998
representing its unutilized input tax.

Due to inaction of CIR, respondent filed an administrative claimfor refund before CTA on
30 June 2000.

ISSUE
Whether or not respondent is entitled to its claim for refund or issuance of a tax credit
representing its unutilized creditable input.

Ruling

No. Silicon is not entitled to its claim for refund or issuance of a tax credit for failing file
the same within the prescriptive period.

The SC in deciding this case dissected the Sec 112 NIRC provision and decided
jurisprudence, which prescribes that a taxpayer-claimant only had a limited period of thirty (30)
days from the expiration of the 120-day period of inaction of the Commissioner of Internal
Revenue to file its judicial claim with CTA. Failure to do so, the judicial claim shall prescribe or
be considered as filed out of time.

*Note: The 2 year prescriptive period refers to the 2 years after the close of the taxable
quarter when the sales were made, within which a taxpayer-claimant may apply for the issuance
of tax credit certificate or refund of creditable input tax due. However, once an administrative
claim was filed, CIR has120-day period to act on the same. In its failure, the tax payer has 30-
day period to file for judicial claim before CTA

Page 1 of 5
GOLEA, Ma. Consorcia A.
2013 – 0060

Procter and Gamble vs. CIR

G.R. No. 202071 February 19, 2014

FACTS:
On 26 September and 13 December 2006 Procter and Gamble (P&G) filed
administrative claim with BIR for the refund or credit of the input VAT attributable to the former’s
zero-rated sales covering the periods 1 July – 30 September 2004 and 01 October – 31
December 2004, respectively.

On 2 October and 29 December 2016, petitioner filed judicial claims.

CTA First Division rendered a Decision dismissing the judicial claims for having been
prematurely filed. CTA En Banc affirmed the dismissal of CTA Division.

ISSUE:
Whether or not the judicial claim suffers the vice of premature filing when the same is
filed before CTA before the lapse of the 120-day period when CIR may resolve on the
administrative claim before it.

RULING:
No. In this case, there is no vice of premature filing even if judicial claim was filed before
lapse of 120-day period for the CIR to resolve on the administrative claim before it.

BIR Ruling No. DA-489-03 expressly states that the "taxpayer-claimant 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. This was valid from its issuance on 10 December 2003 up to its reversal on
06 October 2010 when the case of Aichi Forging Company of Asia, Inc was promulgated. Such
reversal was necessitated when taxpayers continue to get misled to file prematurely their
judicial claims with CTA. The judicial claims in the instant petition were filed on 2 October and
29 December 2006, well within the ruling's period of validity.

Page 2 of 5
GOLEA, Ma. Consorcia A.
2013 – 0060

Silicon vs. CIR

G.R. No.184360 & 184361 February 19, 2014

FACTS:

On 22 April 1999, Silicon Philippines, Inc, filed its Quarterly VAT Return for the 1st
Quarter of 1999 reflecting, among others, output VAT, input VAT on domestic, input VAT on
importation of goods, and zero-rated export sales.

On 06 August 1999, Silicon filed with the CIRa claim for tax credit or refund representing
VAT input taxes on its domestic purchases of goods and services and importation of goods and
capital equipment which are attributable to zero-rated sales for the period 01January 1999 to 31
March 1999.

On 30 March 2001, Silicon filed a Petition for Review with the CTA due to the inaction of
the CIR to toll the running of the two-year prescriptive period.

On 10 August 2000, Silicon filed a second claim for tax credit or refund for the period of
01 April 2000 to 30 June 2000. On 28 June 2002, Silicon filed a Petition for Review before CTA
to toll the running of the 2-year prescriptive period.

ISSUE:
Whether the petitions for review filed by Silicon before the CTA were filed within the
prescribed period in order to determine whether the CTA validly acquired jurisdiction over the
petitions filed by Silicon.

RULING:
No. CTA could have not validly acquired jurisdiction over the judicial claim as they were
filed out of time.

A claim for tax refund or credit, like a claim for tax exemption, is construed strictly
against the taxpayer. Sec. 112 (C) of NIRC prescribes that the CIR has 120 days within which to
decide the taxpayer’s claim for refund or tax credit. In addition, the taxpayer is granted a 30-day
period to appeal to the CTA the decision or inaction of the CIR after the 120-day period. In
reiteration, one of the conditions for a judicial claim of refund or credit under the VAT System is
compliance with the 120+30 day mandatory and jurisdictional periods.

With regard to the 1st administrative claim filed before CIR on 06 August 1999, CIR had
until 04 December 1999 pursuant to the 120-day rule to decide on the claim for tax refund. Due
to inaction of CIR, Silicon had until 03 Jan 2000 to file its judicial claim following the 30-day
period. When Silicon filed its judicial claim on 30 March 2001, it was already 451 days late.

With regard to the 2nd administrative claim filed before CIR on 20 August 2000, CIR had
until 08 December 2000 pursuant to the 120-day rule to decide on the claim for tax refund. Due
to inaction of CIR, Silicon had until 07 January 2001 to file its judicial claim following the 30-day
period. When Silicon filed its judicial claim on 28 June 2002, it was already 536 days late.

Page 3 of 5
GOLEA, Ma. Consorcia A.
2013 – 0060

CIR vs. Pilipinas Shell Petroleum Corporation

G.R. No. 188497 February 19, 2014

FACTS:
Pilipinas Shell paid excises taxes for the petroleum products it sold to international
carriers from October 2001 to June 2002.

It filed administrative claim for refund on the excise taxes it paid. CTA granted
respondent'’ claim for tax refund. However, in the Decision on 25 April 2012, CTA was declared
to have erred in granting the claim for tax refund. A Motion for Reconsideration and
Supplemental Motion for Reconsideration was filed by Pilipinas Shell.

ISSUE:
Whether or not Pilipinas Shell is entitled to refund or credit for the excise taxes it paid for
petroleum products already sold to international carriers.

RULING:
Yes, Pilipinas Shell is entitled to refund. The Supreme Court held that there is prohibition
from passing the excise tax to international carriers who buys petroleum products from local
manufacturers/sellers. Such is pursuant to Section 135 (a) of NIRC, international agreement
under Chicago Convention of 1994, and practice to exempt aviation fuel from excise tax and
other impositions. However, SC held that there is a need to reexamine the effect of denying the
domestic manufacturers/sellers’ claim for refund of the excise taxes they already paid on
petroleum products sold to international carriers, and its serious implications. With the prospect
of declining sales of aviation jet fuel sales to international carriers on account of major domestic
oil companies' unwillingness to shoulder the burden of excise tax, or of petroleum products
being sold to said carriers by local manufacturers or sellers at still high prices , the practice of
"tankering" would not be discouraged. This scenario does not augur well for the Philippines'
growing economy and the booming tourism industry. Worse, the Government would be risking
retaliatory action under several bilateral agreements with various countries. Ultimately, SC
found merit in Pilipinas Shell’s motion for reconsideration. It granted Pilipinas Shell’s claim for
refund representing the excise taxes it paid on petroleum products sold to international carriers.

Page 4 of 5
GOLEA, Ma. Consorcia A.
2013 – 0060

CIR vs. Team Sual Corp (formerly Mirant Sual Corp)

G.R. No. 194105 February 5, 2014

FACTS:
On 24 April 2000, 25 July 2000, 25 October 2000 and 25 January 2001, Team Sual Corp
(TSC) filed its VAT returns for the 1st,2nd,3rd and 4th quarters, respectively of taxable year 2000.

On 11 March 2002, TSC filed its administrative claim for refund for the taxable year
2000.

On 01 April 2002, TSC filed its petition for review before CTA seeking for refund or the
issuance of a tax credit certificate for its unutilized input VAT for the taxable year 2000, which
was granted.

CIR sought a reconsiderationbefore CTA En Banc claiming that petition for review was
prematurely filed because it was filed without waiting for the 120-day period to lapse.

ISSUE:
Whether TSC’s petition for review with CTA was prematurely filed.

RULING:
Yes. TSC’s petition for review with CTA was prematurely filed. Under Sec 112 of the
NIRC it is provided that CIR has 120 days, from the date of the submission of the complete
documents in support of the application for tax refund/credit within which to grant or deny the
claim. In case of full or partial denial by the CIR or its inaction, the taxpayer's recourse is to file
an appeal before the CTA within 30 days from receipt of the decision of the CIR or lapse of the
120-day. Failure to comply with the 120-day waiting period violates the doctrine of exhaustion of
administrative remedies, and renders the petition premature and thus without a cause of action,
with the effect that the CTA does not acquire jurisdiction over the taxpayer's petition.

TSC provided that the 2-year prescriptive period will lapse should it wait to file its judicial
claim only after 120 days it filed its administrative claim.SC find the justification unmeritorious. It
further provided that upon careful reading of Sec 112 of NIRC there are three compelling
reasons why the 30-day period need not necessarily fall within the two-year prescriptive period,
as long as the administrative claim is filed within the two-year prescriptive period: (1) Section
112(A) states that the taxpayer may apply with the Commissioner for a refund or credit "within
two (2) years," which means at anytime within two years; (2) the two-year prescriptive period
does not refer to the filing of the judicial claim with the CTA but to the filing of the administrative
claim with the Commissioner;(3)the theory that the 30-day period must fall within the two-year
prescriptive period adds a condition that is not found in the law. It results in truncating 120 days
from the 730 days that the law grants the taxpayer for filing his administrative claim with the
Commissioner. This Court cannot interpret a law to defeat, wholly or even partly, a remedy that
the law expressly grants in clear, plain, and unequivocal language.

Page 5 of 5