Mindanao II Geothermal Partnership vs. Commissioner of Internal Revenue

AMENDED DECISION

CASANOVA, J.:

Submitted

to

Us

for resolution is petitioner's "Motion for Reconsideration/New Trial," filed on March 19, 2008, of Our Decision promulgated on February 20, 2008 sans respondent's comment. The dispositive portion of the assailed Decision is as follows: "WHEREFORE, for failure of petitioner to properly substantiate its claimed zero-rated sales of services, the Petition for Review is DISMISSED. Accordingly, petitioner's refund claim in the amount of P3,536,550.99 is hereby DENIED.

THE VAT ZERO RATING OF PETITIONER'S SALE

OF

GENERATED POWER IS NOT ANCHORED ON SECTION 108

(B)(3) OF THE 1997 NIRC.

II.

THE BROAD AND SWEEPING RULING OF THIS HONORABLE

COURT EN BANC IN CTA CASE NO. 197 AND CTA CASE NO. 103,

BOTH

ENTITLED

"AMERICAN

EXPRESS

INTERNATIONAL,

INC

-

PHILIPPINE

BRANCH

VS.

COMMISSIONER OF THE INTERNAL REVENUE" 'IS NOT

APPLICABLE IN THE PRESENT CASE. III.

THE EXHORTATION OF THE HONORABLE SUPREME COURT

IN G.R.

NO.

166732 ENTITLED 'INTEL

TECHNOLOGY

PHILIPPINES, INC VS.

COMMISSIONER OF INTERNAL

REVENUE' SHOULD BE APPLIED BY ANALOGY IN THE

PRESENT CASE.

IV.

IN ANY EVENT, TO COMPLY WITH THE PERCEIVED - REQUIREMENT OF THIS HONORABLE COURT, PETITIONER

RESPECTFULLY

SUBMITS

HEREWITH

THROUGH

THE

AFFIDAVIT OF MERIT EXECUTED BY MS. IVY ACOSTA, SENIOR ACCOUNTANT OF PETITIONER, THE OFFICIAL

RECEIPTS CORRESPONDING TO THE SUBMffiED VAT-

COMPLIANT SALES INVOICES."

On July 11, 2008, this Court issued a Resolution upholding petitioner's first argument. In the same Resolution, the second and third arguments were denied. Anent the last argument, this Court issued the following dispositive portion: "WHEREFORE, let a Commissioner's Hearing be set for the pre-marking of documents on July 29, 2008 at 1:30 p.m. Thereafter, let a hearing for the presentation of these documents be held on August 5, 2008 at 9:00 a.m. Meanwhile, the resolution of the 'Motion for Reconsideration/New Trial' is hereby HELD IN ABEYANCE until after petitioner had rested its case." In compliance with the July 11, 2008 Resolution, petitioner submitted its additional documentary evidence which this Court admitted via anothe~ dated

October

9, 2008.

Likewise, petitioner's

Motion

for Reconsideration/New Trial was submitted for resolution. After considering petitioner's supplemental evidence, this Court resolves to partially grant petitioner's claim. The commissioned independent CPA arrived at the following finding in his report¹:

"I believe that the amount of P3,536,504.59 (Annex A) represents a valid claim for input VAT refund. This is net of P46.40 which may be valid VAT transactions but are not within the period being claimed."

However, upon closer scrutiny of this Court, the following input VAT should be disallowed:

Month

ln~ut Vat

Invoice#

Reasons

Exhibit

September

Php

39,813.94 141 No OR, Invoice Only

Exhibit L-20

December

77.46 28133 No OR, Invoice Only

Exhibit L-60

December

19,940.29 162 No OR, Invoice Only

Exhibit L-61

December

364,792.57 163 No OR, Invoice Only

Exhibit L-62

December

21 ,344.13 164 No OR, Invoice Only

Exhibit L-63

December

46,039.67 165 No OR, Invoice Only

Exhibit L-64

TOTAL

Php 492,008.06 As stated in the assailed Decision, sale of services must comply with the invoicing requirements under Section 113 of the NIRC; that is should submit official receipts in support of its claim. Considering that the above sales invoices were not supported by VAT official receipts, this Court cannot consider it in granting petitioner's claim.~

Hence, the claimed amount of P3,536,550.99 is reduced to P3,044,496.53, computed as follows:

Input VAT subject of claim

Less:

Disallowances of Independent CPA

No Official Receipts

Net VAT Refund Claim

Php

3,536,550.99 46.40 492,008.06 Php 3,044,496.53

WHEREFORE, petitioner's Motion for Reconsideration/New Trial is hereby PARTIALLY GRANTED. The Decision promulgated on February 20, 2008 is hereby AMENDED. Respondent is ORDERED TO ISSUE a tax credit certificate in the amount of THREE MILLION FORTY FOUR THOUSAND FOUR HUNDRED NINETY-SIX PESOS AND 53/100.

WE CONCUR:

~~" 1,. ~

(With Separate Concurring &

Dissenting Opinion)

ERNESTO D. ACOSTA Presid"ng Justice u CAESAR A. CASANOVA

Associate Justice

CERTIFICATION

Pursuant to Article VIII, Section 13 of the Constitution, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court's Division. tJ ~(J . \)~ mNESTO D. ACOSTA

Presiding Justice

Chairperson, First Division