CTA Case No. 5334

DECISION

at bar refers to a claim for refund in the amount of P20,086,063.00, allegedly representing overpaid expanded withholding taxes for the calendar year 1993.

Petitioner is a teegistered domestic corporation engaged i·n business as a specialty cont tfact 01· particularly in metal casting.

During the calendatg ye.:w ended Decembeth .31, 1'393, it income payments of J·ieal and contractor fees, subjected to creditable expanded withholding taxes in the total amount of P24, 140,884.00 in compliance with Revenue Hegulations No.

6-85, as amended.

Fotj the same calendar year, petitioner filed on !3e pte mbetk 2, l':J94 an am ended annual income ta>< declaring therein a net income of P11,585,204.00, a tax DECISION

- 2 - due of P4,054,821.00, a creditable income tax withheld of P24, 140,884.00 and a refundable amount of P20,086,063.00 This refundable amount was not utilized by petitioner as it has no other tax liabilities except its the calendar year ended December 31, 1'393.

income tax for Ne i thetH 1-'Jas it used as automatic tax credit pursuant to Section 69 of the Tax Code, as petitioner had no income tax liabilities for the calendar year 1 '3'34, it position in that year.

being in a net loss Hence, in a letter dated September 29, 1 '39'+' petitionetI filed with respondent's office a claim of the amount of P20,086,063.00 as overpaid for at paid ctJeditable expanded withholding taxes for the year 1'3'33.

The claim remained unacted upon and so, to toll the running of the two-year prescriptive period, 1996 petitioner filed with this Court the instant petition.

On l•latJch .-.c:

.::., 1 9'36, summons was on the J·He s pond ent.

Despite such service, respondent failed to file her answer or even a motion for extension of time to file the t;ame.

Consequent 1 y, upon motion filed by petit i onetJ on June 14, 1'395, this Court in a tKesolution ptJomulgated ' on June 24, 1'3'36 (p.

16, CTA tKec. )

declared respondent in DECISION C.T.A.

CASE NO.

5334 - 3 - default and allowed petitioner to present its evidlnce After a careful perusal of all the documentary evidence presented ex-parte including the testimony of petitioner's lone witness, Lina Fernandez, this Court is convinced to grant the refund sought by petitioner but only in the partial amount of P19,854,225.09, computed as follows:

Gross incoll!:

SalR of goods ISchRdulR 1) Sale of services !Schedule 2) Rentals (Schedule 4) Interest, royalties, dividends not subject to final withholding tax !Schedule 5) Sale of property other than capital assets (Schedule 7> Total Less deductions !Section El Net incoll!

Tax Due IP1115851204.00 x 353) Less allowable creditable tax withheld per Schedule "A"

TOTAL AMOUNT REFUNDABLE

CREDITABLE WITHHOLDING TAX AT SOURCE:

!Schedule "A") A. Fro• Sale Of Real Properties: Aaount of Withholding Agent Exh.

I nco II!

PaSaent Benguet Manageaent Corporation D, D-1 P233,800,000.00 EnginRering Equipaent, Inc. E 84,323,200.00 Benguet Manageaent Corporation F, F-1 105,000,000.00 Benguet Tlanageaent Corporation G, G-1 30,311,850.00 Placido 0. Urbanes I, I-1 434,383.60 Raton M. Cordova J, J-1 462,266.04 Rouel U. Tinio K, K-1 1,800,000.00 RZS Resources, Inc.

L-12 1,654,442. 40 Mr. & Mrs. Val Santos M, M-1 211601000.00 Sub Total P45919461142.04 p 89, 709, 791.00 2,497,935.00 694,909.00 902,212.00 145,432,783.00 P23912371630.00 227,652,426.00 p 11,585,204.00 p 4,054,821.40 23,909,046.49 p 19,854,225.09 Aaount of Tax Withheld P11,690,000.00 4,216,160.00 5,250,000.00 1,515,593.00 10,859.59 11,556.65 90,000.00 41,361.06 541000.00 P2218791530.30 • I DECISION

- 4 — B. From Rentals:

Asount of Asount of Withholding Agent Exh. Income FPaysent Tax Withheld Consolidated Ind. Gases, Inc. N, N-] = P 127,641.60 P 6, 382. 08 Engineering Equipsent, Inc. G, O-1 250, 000. 00 12,500. 00 Engineering Equipaent, Inc. P, P-1 250, 000. 00 12,500. 00 Sub Total P_ 627,641.60 P31, 382.08 C. From Fees As Contractor Asount of Amount of m =x —s Withholding Agent Incose Paysgent Tax Withheld Bacnotan Ceaent Corp. Q, Q-1 P 1,652,559.00 P 16,529.59 Central Azucarera Don Pedro R, R-1 400, 000. 00 4,000. 00 Central Ceaent Corp. S, 5-1 3, 420, 061.00 34, 200. 61 Concrete Aggregates Corp. T, 1-1 154, 286. 00 1,542. 86 Hi Ceaent Corporation U, U-1 1, 427,635. 00 14,276.35 Iligan Ceaent Corporation V, V-1 75, 040. 30 750. 41 Kawasaki Steel Corporation W, W-1 337,970.00 5, 375. 70 Marcopper Mining Corporation X, X-1 3,245, 565. 00 32, 459. 63 Philex Mining Corporation Y, Y-1 80,530, 370. 00 805, 903. 70 Phil. Rock Products, Inc. Z, 7-1 111,915.00 4,419.15 Republic Ceaent Corporation AA, AA-1 1, 123,534. 66 11,235. 34 Rizal Cement Co., Inc. BB, BB-i 5, 915, 948. 00 59, 159. 48 Solid Ceaent Corporation CC, CC-1 1,158, 927.00 11,589.27 Sub Total P99,813,411.56 P 998,134.11 T O TAL P23, 909,046.49 Furthermore, this Court likewise grants to petitioner the above~stated partial refund considering its compliance with the three (3) basic requirements in Claiming for the refund of excess expanded withholding tax, which are as follows:

ve That it Filed a claim for refund within the two (2) year period from date of payment of the tax as prescribed under Section 2399 (now 230) of the National Internal Revenne Code, as amended;

i That the income upon which the taxes were withheld at source wunder Section SS were included as part of the income declared in the income tax return of the recipients; and DECISION C.T.A. CASE NO.

5334 - 5 - 3.

The fact of withholding is established by a copy of statement CBIR Form 17'+3.1) duly issued by the payotX <withholding agent) to the payee, showing the amount paid and the amount of tax withheld therefrom.

[Sec.

10, Rev.

Regs.

6-85;

see Ci tytrust Finance Corporation vs.

The Commissioner of Internal Revenue, CTA Case No.

4134, Nove•ber 11, 1991;

affirmed by the Court of Appeals in Citytrust Finance Corporation vs.

Court of Tax Appeals and the Com•issioner of Internal Revenue, CA-G.R. SP No. 28239, March 14, 1994;

and Citytrust Finance Corporation <Formerly Investor's Finance Corporation/FNCB Finance) vs. Com•issioner of Internal Revenue, CTA Case No.

4046, February 24, 1993;

affirmed by the Court of Appeals in Commissioner of Internal Revenue vs.

Citytrust Finance Corporation <Formerly Investors Finance Corporation/FNCB Finance) and the Court of Tax Appeals, CA-G.R.

SP No. 31104, April 18, 19941.

Exhibits "H" to "H-3" inclusive <Monthly Remittance of Income Taxes 1.-Jithheld, PP· 52-53, CTA rec. )

were excluded in the Court's computation as they pertain to thf payment of withholYing tax for 1994.

petit i onet[ failed to submit evidence relative payment of li'lithholding tax and income

WHEREFORE, finding instant petition F•JtZther, to the as a the only the amount of P19,854,225.09 and hereby ORDERS respondent to REFUND such amount in favotZ of petitionet\ as unutilized atZ overpaid creditable expanded withholding tax fat] the yeatX 19'33.

')Q[' DECISION C.T.A. CASE NO.

5334 - 6 - SO ORDERED.

Q.  ERNESTO D.

ACOSTA Presiding Judge

CONCUR I

I I ' ' , oi:

--:tQ)'N 0.

DE A Associate J Clge CERTIFICATION hereby certify that this decision was reached after due consultation with the member of the Court of Tax Appeals in accordance with Section 13, Article VIII of the Constitution.

 Q

... Q ERNESTO D.

ACOSTA Presiding Judge Court of Tax Appeals .iR7

1 I