AF Holdings and Management Corporation, et al. vs. Commissioner of Internal Revenue, et al.

DECISION -

- 2 - integral part of this petition, showing a refundable amount of P17,681.00 rep rese nting current (P6,500.00) and prior (P13,004.00) year's creditable taxes withheld.

Petitioner applied for a refund of P13,000.00 of the prior year's excess credita ble tax leaving a balan ce of P4.00 which it applied against its tax liability for 1988.

Petitioner lik ewise applied against it s 1988 and 1989 tax liabilities the cu rr en t excess creditable tax of P6,500.00 leaving a refundable balance of P3,508.32.

3 .

On December 7, 1990, petitioner filed a claim for refund of P3,508.32 with the respondent; a copy of the aforesa id claim is hereto attached as Annex "B" and made an integral part of this petition for review. 4 .

The prescriptive period for refunds for 1988 will expire on December 30, 199 0 but respondent has not been a ble to process the aforesaid claim;

this p~tition for review is being filed to interrupt said prescriptive period. Hence , this petition for review. By way of special and affirmative defenses, respondent objected to the petition for review filed by the petitioner stating, among others, that "the petition states no cause of action as it does not allege the date/s when the alleged taxes withheld sought to be refunded were actually paid (Ha nu facturer's Bank and Trust Co., as Trustee of Gen. Trust Plan v.

Comm. of Int. Rev., CTA Cas e No. 1059, No v. 19, 196 5)."

Ho reover, "in a cl a jm 190 - 3 - for refund, it i s incumbent upon petitioner to show that it is e ntitl ed thereto, otherwise, failure on the part of petitioner to prove the same is fatal to its claim for refund . "

And lastly, " c l ai ms for refund," according to the resp ondent, "are co nst r ued against the claimant for it partakes of th e nature of exemption fr o m t axatio n ( Co mm.

of Int. Rev. v. Ledesm a , G.R. No. L- 17509, Jan. 30, 1970, 31 SCRA 95). Confident of the weakness of the petitioner's ca se , counsel for the respondent manifested in open cour t o n June 25, 1992 which later on was granted by the Court, that "she is submitting her case for decision on the basis of records and pleadings without the necessity of filing her me morandum."

(See remarks of the Executive Clerk of Court, CTA r ecord, p. 33.) The petitioner, however, submitted and offered as evidence the following exhibits, to wit :

1.

"E xhibit 'A' - which is the in c om e tax return of th~ taxpayer for the cale ndar year ending December 31, 19 88 , including the financial statements prepared by Joaquin Cunanan and Co.

Purpose: t o s how that in that year the taxpayer fil ed an income tax return showing an in co me tax due of P1,8 23 .00, various creditable taxes withheld of P6,500.00";

- 4 - 2 .

"E xhibit 'B' and 'B - 1' which are t h e ce rtifi c ates of creditable tax e s withh e ld a t s ource, to show that Paseo Realty and Devel o pm e nt Corporati on in payi ng a ma nagem e nt fee of P3,250.00 per se mester in 1988, withheld a to tal a mount of P6,500.00 from the paym e nts due to the ta xpayer. " 3.

"Exhibit 'C' and 'C-1' to .show th a t the t ax p a yer filed a claim for refund on De ce mber 12, 1990." (T.S.N., pp. 12-13 , Hearing of Oct. 22,1991.) The counsel for respondent , on the other hand, objected to the purposes for which the above e xhibits we re being offered or the grounds reli e d upon by the petitioner on this claim for refund. She averred that if ever there really was a withholding in the total amount of P6 , 500.00, "the b e st evidence of payment and remittance of which are the Central Bank confirmation receipts."

( T . S .N., p. 14, Hearing of Oc t. 22 , 1991.) Th e e viden c es at hand hardly gives us a leg a l groun d n o t e ven a logi c al one to grant the claim f or r efun d as pr a yed by the petiti oner.

The amoun t of P3 , 50 8 . 3 2 is n o t even r e fle c t e d i n any and all of the evidences offered by the petitioner.

We cannot just make our ·own wild co nj e ctures as to how the amount was arrived at wanting the ne c es sa ry supporting docum e nts.

Of l ct •·· u I , ·

- 5 - conrse , the petitioner does not expe ct t hi s Court t o g0 beyond eva luating evidences wh' c h are only at h a nd.

In sh o rt, the clai m for re fund f a ll s unde r the category of mere s elf-serving stipu lati ons ad v a n ced by the petitioner .

In a claim f or refund , as pointed out by the respondent , it is incumbent upon the petiti o ner to show that it is entit l ed thereto, o t hervris e , fail ure on its part to prove the same i s fa t al to i ts claim f or ref und.

Thi s is true si n ce claims for refund are constru e d strictly . a gainst the c l ai ma nt for it p artakes of the natur e of exemption fr om t axat i on.

( Comm. of Int. Rev. v. Lede s ma, G.R.

No. L-1 7509, Jan. 30, 1970, 3 1 SCRn

95. ) In the h ea ring o f this case on October 22 , 1991, petitio n e r averre d that a part of th e P6,500.00 creditab le tax withheld in 1988 was parti a lly a p p l ie d to its income li abil ity in 19 89 . However, the 1989 income tax retu r n was never p re s e n t ed f o r proper evaluation a nd identific t i o n.

Suc h d oc uments are wanting in support of the pet it ioner's case .

IN VIEW

OF THE

FOREGOING, this Court hereby DENIES the claim for refund by the petitioner for ..

I I

- 6 - lack of merit.

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RAHON 0. DE VE A As sociate Ju ge ~<c~a. ~ ERNESTO D. ACOSTA Presiding Judge CERTIFICATION I hereby certify that this decision was reached after due consultation between the members of the Court of Tax Appeals in accord a nce with Section 13, Article VIII of the Constitution. g~\.Q~ ~ ERNESTO D. ACOSTA Presiding Judge Court of Tax Appe als