Alkylate is not subject to excise tax under Section 148(e) of the 1997 NIRC, as amended, because it is not expressly listed therein, nor does it fall under the category of "other similar products of distillation" as it is produced through alkylation (a chemical process) rather than distillation (a physical separation process) and possesses distinct properties and uses compared to naphtha and regular gasoline.

Petron Corporation, a manufacturer of petroleum products, imported alkylate for use as a blending component in gasoline production. Following a Bureau of Internal Revenue (BIR) letter dated June 29, 2012, implemented by Bureau of Customs (BOC) Customs Memorandum Circular (CMC) No. 164-2012 dated July 18, 2012, alkylate was deemed "similar to that of naphtha" and subjected to excise tax under Section 148(e) of the NIRC. Petron paid the taxes but contended they were erroneously imposed.

• Petron Corporation imported alkylate on five occasions between July 22, 2012, and November 6, 2012.
• Pursuant to BOC CMC No. 164-2012, implementing a BIR letter, these importations were subjected to excise tax under NIRC Section 148(e), totaling P219,153,851.00, which Petron paid.
• Petron filed timely administrative claims with the BIR for refund on October 10, 2014, and January 23, 2015 (covering different periods including the disputed ones), arguing the taxes were erroneously collected.
• As the BIR did not act on the claims, Petron filed two Petitions for Review with the CTA on October 23, 2014, and February 6, 2015, which were later consolidated.
• Petron presented expert witnesses (Dr. Joey Ocon, Simon Christopher Mulqueen, Bayani I. Rodriguez) and documentary evidence, including a Department of Energy (DOE) letter dated July 24, 2017.
• Evidence established that alkylate is produced through alkylation, not distillation; it is an intermediate gasoline blending component, not a finished fuel; it differs significantly from naphtha and regular gasoline in boiling range, volatility, properties, and recovery process; and it cannot be used as motor fuel alone under Philippine standards.
• The respondent (CIR) relied on the BIR Laboratory Section Chief's (Ramos) finding that alkylate is similar to naphtha based on reference materials, and the argument that alkylate's raw materials are products of distillation.

• Alkylate is not explicitly listed as an excisable article under Section 148(e) of the 1997 NIRC, as amended.
• Alkylate is produced through the chemical process of alkylation, not the physical process of distillation, and therefore cannot be considered a "product of distillation."
• Alkylate is not similar to naphtha or regular gasoline based on its distinct chemical properties, physical characteristics (boiling point, volatility), production process, and intended use as solely a blending component.
• The claim for refund is based on erroneous payment due to the absence of a law taxing alkylate, not on tax exemption; thus, the rule of strict construction of tax laws against the government should apply.
• Taxing alkylate as a component and later the finished gasoline containing it constitutes double taxation.
• The principle of ejusdem generis limits the scope of "other similar products of distillation" to products truly akin to naphtha and regular gasoline.
• BOC CMC No. 164-2012, based on an erroneous BIR interpretation, cannot legally impose the excise tax.

• Alkylate falls under "other similar products of distillation" in Section 148(e) because its raw materials (light olefins and isobutane) are derived from petroleum through distillation.
• Section 148(e) does not distinguish whether the taxable item must be a primary or secondary product of distillation.
• BOC CMC No. 164-2012, issued in the exercise of quasi-legislative functions based on a BIR letter, has the force and effect of law and enjoys the presumption of validity.
• Claims for tax refunds are in the nature of tax exemptions and must be construed strictly against the claimant (Petron).
• There is no double taxation because the tax on importation is distinct from the potential tax on the removal of the finished product (gasoline) for domestic sale.

• Whether the CTA En Banc erred in applying the rule of strict construction for tax exemptions instead of the rule of strict construction against the government in the imposition of taxes.
• Whether alkylate falls under the category of "naphtha, regular gasoline and other similar products of distillation" subject to excise tax under Section 148(e) of the 1997 NIRC, as amended.
• Whether Petron Corporation is entitled to a refund of the excise taxes paid on its alkylate importations.

• Yes, the CTA En Banc erred in denying the refund; Petron is entitled to the refund of P219,153,851.00.
• The applicable rule is the strict construction of tax laws against the government (strictissimi juris), not the strict construction of tax exemptions, because Petron's claim is based on the argument that no law imposes excise tax on alkylate (erroneous payment), not that it is exempt from a validly imposed tax.
• Alkylate is not subject to excise tax under Section 148(e) as it is not expressly enumerated.
• Alkylate does not fall under "other similar products of distillation" because undisputed evidence shows it is produced via alkylation, a distinct chemical process, not distillation. Taxing a product based on the origin of its raw materials stretches the statutory language beyond its plain meaning.
• Expert testimony and DOE confirmation establish significant differences in properties, production, and use between alkylate, naphtha, and gasoline, preventing alkylate from being considered "similar."
• Applying the principle of ejusdem generis, the phrase "other similar products of distillation" must be restricted to items of the same kind or class as the specifically enumerated items (naphtha and regular gasoline), which alkylate is not.
• Administrative interpretations, like CMC 164-2012 based on the BIR's position, cannot override, supplant, or modify the clear language or absence of language in the statute; courts are not bound by erroneous administrative interpretations.

• Strict Interpretation of Tax Laws (Strictissimi Juris) Against the Government: Tax laws imposing burdens are construed strictly against the government and liberally in favor of the taxpayer. Ambiguity or doubt in the tax statute is resolved in favor of the taxpayer. Applied here because Section 148(e) does not clearly, expressly, and unambiguously impose excise tax on alkylate.
• Strict Construction of Tax Exemptions Against the Taxpayer: Tax exemptions are not favored and are construed strictly against the taxpayer, who must prove entitlement clearly. Distinguished and deemed inapplicable in this case because the claim was for a refund based on erroneous collection (no statutory basis for the tax), not a claim under an exemption statute.
• Ejusdem Generis: Where general words follow an enumeration of specific words, the general words are construed to embrace only objects similar in nature to those specifically enumerated. Applied to limit "other similar products of distillation" in Section 148(e) to products akin to naphtha and regular gasoline, thereby excluding the chemically distinct alkylate.
• Non-conclusiveness of Administrative Interpretations: Interpretations placed upon a statute by executive officers are not conclusive and will be ignored by courts if found to be erroneous or inconsistent with the law. Applied here to disregard the CIR's reliance on CMC 164-2012 and internal reports which contradicted the statute's plain meaning and expert evidence regarding alkylate's nature.

• "Unless a statute imposes a tax clearly, expressly and unambiguously, what applies is the equally well-settled rule that the imposition of a tax cannot be presumed. Where there is doubt, tax laws must be construed strictly against the government and in favor of the taxpayer."
• "[T]here is parity between tax refund and tax exemption only when the former is based either on a tax exemption statute or a tax refund statute."
• "However, when the claim for tax refund is premised on the taxpayer's erroneous payment of the tax or the government's exaction in the absence of a law, the rule to be applied must be the well-settled doctrine of strict interpretation in the imposition of taxes, not the similar doctrine as applied to tax exemptions."
• "Alkylate is not expressly mentioned in the above-quoted provision [Sec. 148(e)] as one of the goods subject to excise tax. Neither does it tax 'products whose raw materials are products of distillation.' Rather, the provision plainly taxes only '[n]aphtha, regular gasoline and other similar products of distillation.'"
• "Courts, however, will not uphold these authorities' interpretations when clearly absurd, erroneous or improper."

• Commissioner of Internal Revenue v. Fortune Tobacco Corporation (581 Phil. 146 (2008)): Cited to distinguish between claims for refund based on exemption (strict construction against taxpayer applies) and claims based on erroneous payment (strict construction against government applies), supporting Petron's argument on the applicable rule. Also cited for the general principle of strict construction against the government in tax imposition.
• Commissioner of Internal Revenue v. The Philippine American Accident Insurance Company, Inc. (493 Phil. 785 (2005)): Cited for the principle that tax imposition cannot be presumed and tax laws are strictly construed against the government, resolving doubt in favor of the taxpayer, unless the taxpayer is clearly subject to the tax.
• Power Sector Assets and Liabilities Management Corporation v. Commission on Audit (G.R. No. 205490, September 22, 2020): Cited as the source for the definition and application of the statutory construction principle of ejusdem generis.
• Philippine Bank of Communications v. Commissioner of Internal Revenue (361 Phil. 916 (1999)): Cited for the rule that administrative interpretations by executive officers are not conclusive and will be ignored by courts if found erroneous or inconsistent with the law.
• Medicard Philippines, Inc. v. Commissioner of Internal Revenue (808 Phil. 528 (2017)): Cited for the principle that courts will not uphold administrative interpretations when they are clearly absurd, erroneous, or improper, emphasizing judicial oversight over administrative tax rulings.

• National Internal Revenue Code (NIRC) of 1997, as amended by R.A. 9337:
  • Section 148(e): The central provision defining excise taxes on manufactured oils and other fuels, specifically mentioning naphtha, regular gasoline, and "other similar products of distillation." The core of the dispute revolved around its interpretation.
  • Section 229: Governs the recovery of erroneously or illegally collected taxes, setting the two-year prescriptive period for filing refund claims. Cited to confirm Petron's claims were timely filed.
• Rules of Court:
  • Rule 45: Governs Appeals by Certiorari to the Supreme Court. The basis for Petron's petition to the Supreme Court.
• Republic Act No. 1125, as amended by R.A. 9503: The law creating the Court of Tax Appeals and governing its procedures.
  • Section 2: Mentioned in the CTA En Banc resolution regarding the required number of votes to reverse a decision.
• Revised Rules of the Court of Tax Appeals (RRCTA):
  • Rule 2, Section 3: Referenced in the CTA En Banc resolution concerning the voting requirements for decisions.
• Bureau of Customs (BOC) Customs Memorandum Circular (CMC) No. 164-2012: The administrative issuance that implemented the BIR's position subjecting alkylate to excise tax under Section 148(e).
• Philippine Clean Air Act (Implicit): Referenced concerning Philippine National Standards (PNS) for fuel, used to show alkylate alone does not meet motor fuel standards.