Golden Arches Development Corporation vs. Commissioner of Internal Revenue

DECISION

PALANCA-ENRIQUEZ, J.: A taxpayer's excess withholding tax credits for the taxable quarter/taxable year shall automatically be allowed as a refund or credit for purposes of filing his income tax return for the taxable quarter/taxable year immediately succeeding the taxable quarter/taxable year in which the aforesaid excess credit arose. This right to refund or credit, however, is not automatic, the taxpayer must be able to prove the same by substantial evidence, pursuant to the prescribed requirements set forth in our Tax Code.

®

THE CASE

2 This is a Petition for Review filed by Golden Arches Development Corporation (hereafter "petitioner") praying for the refund or issuance of a tax credit certificate in the total amount of P56,220,970.00, representing its unutilized creditable income taxes withheld for calendar year ending December 31, 2002.

THE FACTS

In their Joint Stipulation of Facts, the parties stipulated as follows: "1. On April 21, 2003, petitioner filed with the BIR, through the Electronic Filing and Payment System (EFPS), its Annual Income Tax Return for CY ending December 31, 2002;

2.

On November 25, 2003, petitioner filed an Amended Annual Income Tax Return for CY 2002 with the BIR;

3.

Petitioner's Application for Tax Credits/Refunds (BIR Form No. 1914) for unutilized creditable withholding taxes for CY 2002, stamped received by the BIR on April 1, 2005, is authentic and duly-executed; 4.

Petitioner's administrative claim for refund of unutilized creditable withholding taxes for CY 2002 dated April 1, 2005, addressed to Ms. Maridur V. Rosario of the BIR,L TDO - Makati, is authentic and duly-executed; 5.

On November 28, 2002, the Securities and Exchange Commission ("SEC") approved the merger between the petitioner and McGeorge Food Industries, In(i1.1

6. As stated in its Amended Articles of Incorporation filed with the SEC on November 28, 2002, petitioner's primary purpose was amended to that of establishing, maintaining, operating and managing, for its own account or for the account of other entities or individuals, restaurants, cafes, bars, and general food catering services;

7. To date, respondent has neither denied nor approved petitioner's administrative claim for refund or unutilized creditable withholding taxes for CY 2002." 3 In her Answer, respondent alleged by way of special and affirmative defenses that petitioner failed to demonstrate that the tax subject of the case at bar was erroneously or illegally collected; taxes paid and collected are presumed to have been made in accordance with law and regulations, hence, not refundable; in an action for tax refund/credit, the burden of proof is on the taxpayer to establish its right to refund and failure to adduce sufficient proof is fatal to the action for tax refund/credit; it is incumbent upon the petitioner to show that it has complied with the provisions of Section 204, in relation to Section 229 of the Tax Code, as amended; and finally, claims for refund are construed strictly against the claimant for the same partakes of the nature of exemption from taxation and as such, are looked upon with disfavor. Petitioner presented its Senior Accounting Manager, Cornelia Naguit, as witness, and documentary evidence, marked as Exhibits "A " {MJP 4 to "RR ", inclusive of their submarkings, which were all admitted by the Court.

On February 16, 2006, petitioner filed a "Motion for Leave to Admit Amended Petition for Review", which was granted and the Amended Petition for Review was admitted. The Amended Petition for Review incorporated the alternative option and willingness of petitioner to accept a TCC, in lieu of cash refund, for its claim of unutilized creditable withholding taxes. On the other hand, respondent waived her right to present evidence and submitted the case for decision. Thereafter, both parties were ordered to file their simultaneous memoranda, within thirty (30) days from July 25, 2007. Considering that only petitioner filed its memorandum, the case was deemed submitted for decision on October 17, 2007. Hence, this decision.

ISSUES

As stipulated upon by the parties, the following are the issues for the consideration of this Court: I

WHETHER OR NOT PETITIONER'S WITHHOLDING

TAX CREDITS OF P68,446,803.00 FOR CY 2002 ARE (p)JL

DULY SUBSTANTIATED BY DOCUMENTARY EVIDENCE.

II WHETHER OR NOT PETITIONER HAS AN

UNUTILIZED/EXCESS CREDITABLE WITHHOLDING

TAX IN THE AMOUNT OF P56,220,970.00 FOR CY 2002. III

WHETHER OR NOT THE INCOME FROM WHICH THE

SUBJECT CREDITABLE TAXES WERE WITHHELD

WERE

REPORTED AS

PART OF

PETITIONER'S

REVENUES IN ITS ANNUAL INCOME TAX RETURN

FORCY2002.

IV

WHETHER OR NOT SAID PETITIONER'S UNUTILIZED

CREDITABLE WITHHOLDING TAXES AS OF DECEMBER 31, 2002 WERE APPLIED AGAINST ITS

INCOME TAX LIABILITY IN THE SUCCEEDING

TAXABLE YEAR/S.

v WHETHER OR NOT PETITIONER FILED ITS

ADMINISTRATIVE CLAIM FOR REFUND/TAX CREDIT

IN

ACCORDANCE WITH

THE PROVISIONS OF SECTION 204 (C) OF THE TAX CODE. VI

WHETHER OR NOT PETITIONER FILED ITS JUDICIAL

CLAIM FOR REFUND/TAX CREDIT WITHIN THE TWO

YEAR PERIOD AS PROVIDED UNDER SECTION 229

OF THE TAX CODE.

~ 5

Principal Issue 6 The foregoing Issues raised by both parties boil down to the principal issue of whether or not petitioner is entitled to a refund or issuance of a tax credit certificate in the amount of P56,220,970.00, attributable to its unutilized creditable income taxes withheld for CY 2002.

THE RULING OF THE COURT

The petition is partly meritorious. A perusal of petitioner's Annual Income Tax Return (both original and amended) for the calendar year 2002 shows a gross income of P611,291,648.00 and operating expenses ofP611,291,648.00, resulting to a net operating loss. Pursuant to Section 27(E)(J) of the National Internal Revenue Code of 1997 (hereafter "NIRC of 1997"), as amended, petitioner is still liable for the Minimum Corporate Income Tax (MCIT) in the amount of P12,225,833.00. Consequently, the excess taxes withheld during the course of the taxable year, while collected legally, partakes of the nature of erroneously collected taxes at the end of the taxable year.

In this regard, Section 76 of the NIRC of 1997, as amended, provides:

"SEC. 76. Final Adjustment Return - Every corporation liable to tax under Section 27 shall file a final adjustment return covering the total taxable income for the preceding calendar or fiscal year. If the sum of the quarterly tax payments made during the said taxable year is not equal to the total tax due on the entire taxable income of that year, the corporation shall either:

(A) Pay the balance of tax still due; or (B) Carry over the excess credit; or (C) Be credited or refunded with the excess amount paid, as the case may be.

In case the corporation is entitled to a tax credit or refund of the excess estimated quarterly income taxes paid, the excess amount shown on its final adjustment return may be carried over and credited against the estimated quarterly income tax liabilities for the taxable quarters of the succeeding taxable years. Once the option to carry-over and apply the excess quarterly income tax against tax due for the taxable quarters of the succeeding taxable years has been made, such option shall be considered irrevocable for that taxable period and no application for cash refund or issuance of a tax credit certificate shall be allowed therefor." 7 The above provision gives two options to a taxable corporation whose total quarterly income tax payment in a given taxable year exceeds its total income tax due. These options are (1) be credited or refunded either in the form of cash or credit certificate with the excess amount paid; or (2) carry over the excess credit to the succeeding taxable year. 0N- 8 The first option works simply by applying for a cash refund or tax credit certificate with the Bureau of Internal Revenue for any tax on income that is paid in excess of the amount due to the government. The second option, on the other hand, works by applying the refundable amount, as shown on the Final Adjustment Return of the given taxable year, against the income tax liabilities of the succeeding taxable year. The two options under Section 76 are alternative in nature (Paseo Realty & Development Corp. v. Court of Appeals, 440 SCRA 235, 250-251). The choice of one precludes the other. Once the choice is made, it shall be considered irrevocable for that taxable period, and no application for a tax refund or issuance of a tax credit certificate shall then be allowed regardless of whether or not the excess tax credit is actually utilized. A perusal of petitioner's Annual Income Tax Return (both original and amended) for calendar year ending December 31, 2002 shows that petitioner did not mark any choice in the options provided under Item 31 thereof. A perusal also of the succeeding Annual Income Tax Return for calendar year 2003 (Exhibit "C'') reveals that petitioner did not indicate any amount of prior year's excess credit. Evidently, petitioner did not carry over its claimed amount of P56,220,970.00, as tax credit to the succeeding taxable year 2003. The subsequent filing of a claim for refund

9 with the BIR is a clear manifestation of its intention to have its excess tax payments be refunded as cash or tax credit certificate. However, in order to be entitled to a claim for refund or issuance of a tax credit certificate of excess creditable withholding tax at source, petitioner must comply with the following requisites prescribed under Section 2.58.3 of Revenue Regulations No.2-98, otherwise known as the Withholding Tax Regulations, to wit: 1) That the claim for refund was filed within the two-year reglementary period prescribed under Section 204(C), m relation to Section 229 of the NIRC of 1997, as amended; 2) That the fact of withholding is established by a copy of the statement duly issued by the payor (withholding agent) to the payee (BIR Form No. 1743-A), showing the amount paid and the amount of tax withheld therefrom; 3) That it is shown on the return of the recipient that the income payment received was declared as part of the gross income declared in the income tax return of the recipient (Citibank N.A. vs. Court of Appeals and Commissioner of Internal Revenue, 280 SCRA 459).

10 Thus, it is imperative that petitioner should be able to prove the above requisites.

First Requisite - Claim For Refund Was Filed Within the Two-year Prescriptive Period In this connection, Sections 204 (C) and 229 of the NIRC of 1997, as amended, provide:

"SEC. 204.

Authority of the Commissioner to Compromise, Abate and Refund or Credit Taxes. The Commissioner may - (A) XXX (B) XXX (C) Credit or refund taxes erroneously or illegally received or penalties imposed without authority, refund the value of internal revenue stamps when they are returned in good condition by the purchaser, and, in his discretion, redeem or change unused stamps that have been rendered unfit for use and refund their value upon proof of destruction. No credit or refund of taxes or penalties shall be allowed unless the taxpayer files in writing with the Commissioner a claim for credit or refund within two (2) years after the payment of the tax or penalty: Provided, however, That a return filed showing an overpayment shall be considered as a written claim for credit or refund." "SEC. 229.

Recovery of Tax Erroneously or Illegally Collected. - No suit or proceeding shall be maintained in any court for the recovery of any national internal revenue tax hereafter alleged to have been erroneously or illegally assessed or collected, or of any [t1fL penalty claimed to have been collected without authority, or of any sum alleged to have been excessively or in any manner wrongfully collected, until a claim for refund or credit has been duly filed with the Commissioner; but such suit or proceeding may be maintained, whether or not such tax, penalty, or sum has been paid under protest or duress. In any case, no such suit or proceeding shall be filed after the expiration of two (2) years from the date of payment of the tax or penalty regardless of any supervening cause that may arise after payment: Provided, however, That the Commissioner may, even without a written claim therefor, refund or credit any tax, where on the face of the return upon which payment was made, such payment appears clearly to have been erroneously paid."

11 The two-year prescriptive period for the filing of a claim for refund under Section 204 (C), in relation to Section 229 of the NIRC of 1997, as amended, commences from the date of filing of the final adjustment return (ACCRA Investments Corp. vs. Court of Appeals, 204 SCRA 957). It must be stressed that the rationale in computing the two-year prescriptive period with respect to petitioner corporation's claim for refund from the time it filed its final adjustment return is the fact that it was only then that petitioner could ascertain whether it made profits or incurred losses in its business operations.

Records reveal that petitioner filed its Annual Income Tax Return for the calendar year ending December 31, 2002 on April 21, 2003 (}tf

12 (Exhibit "A-7") through electronic filing and within the extended period for filing income tax returns by virtue of Revenue Regulations 15-2003. Counting from April 21 , 2003, petitioner had until April 21, 2005, within which to file its claim for refund/tax credit certificate, both administratively and judicially.

Therefore, both petitioner's administrative claim filed on April 1, 2005 (Exhibit "D ") and the instant Petition for Review filed on April 13, 2005 were filed within the two-year prescriptive period under Section 204 (C), in relation to Section 229 of the NIRC of 1997, as amended. Clearly, the first requirement has been complied with.

Second Requisite - Taxes Withheld Are Duly Supported by Certificates o[Tax Withheld To prove the fact of withholding of the reported creditable taxes withheld for the first three quarters and fourth quarter of 2002 in the respective amounts of P48,068, 171.00 (Exhibit "B-3 '') and P20,378,632.00 (Exhibit "B-4 '') or in the total amount of P68,446,803 .00, petitioner presented Certificates of Creditable Tax Withheld at Source duly issued to it by various withholding agents for the same year (Exhibits "1-1 " to "1- 50" "L-1 " to "L-108" "N-1 " to "N-103 " "0-1 " to "0-215 " "R " "S" and "T") ' ' ' , ' ' which were all summarized in Exhibit "V". ~

13 However, upon a careful examination of the documentary evidence presented, the Court finds that the following certificates should be disallowed for the same pertain to final taxes withheld on royalties: Exhibit 0-13 0-36 Withholding AgentlPayor Alfonso Ng Davao City Food Industries, Inc. Final Tax Withheld p 61,954.49 6,037.63 Total P 67.992.12 Likewise, this Court denies the following certificates with creditable withholding taxes in the amount ofP151,227.76 on the ground that petitioner is not indicated as the payee/income recipient, but as the withholding agent/payor: Exhibit L-58 L-59 L-60 Withholding AgentlPayor Golden Arches Development Corp. Golden Arches Development Corp Golden Arches Development Corp Total Creditable Tax Withheld p 23,133.36 49,888.98 78.205.42 p 151.227.76 Thus, this Court holds that only the creditable withholding taxes amounting to P68,227,583.31 are duly supported by valid withholding tax certificates, which are summarized, as follows, per nature of income payment:

Nature of Income Payment Rentals - Real Property Payments to Prime Contractors/Sub-Contractors Professional Fees Sales of Real Property Other Than Capital Assets Sales of Goods Royalties Total Income Tax Withheld P62,032,657.07 344,114.09 142,945.54 5,613,937.49 73,338.58 20,590.53

14 The details of the creditable withholding taxes in the amount of P68,227,583.31 is hereto attached and made an integral part of this decision, as Annex "A". Third Requisite - The Income Withheld Were Declared as Part o{Petitioner 's Gross Income With regard to the third requisite, in its amended 2002 income tax return (Exhibit "B ''), petitioner reflected the following gross income amounts:

Sale of Goods/Properties Sale of Services Lease of Properties Total Sales/Revenues/Receipts/Fees (Exhibit "B-8") Interest Income Gain on sale of restaurant business Rent Income Other Income Total Other Income (Exhibit "B-9'J Gross Income Per Income Tax Return p 572,232,425.00 10,922,502.00 1.221 .741 ,087.00 P1.804 896.014.00 p 14,179,984.00 28,723,821 .00 16,463,321 .00 9,736,992.00 p 69.104.118.00 On the other hand, the certificates show that creditable withholding taxes of P68,227,583.31 were withheld on income payments, totalling to P1 ,344,977,364.94, which are summarized per nature of income payment, broken down as follows:

Per Certificates 15 Rentals - Real Property Payments to Prime Contractors/Sub-Contractors Professional Fees Sales of Real Property Other Than Capital Assets Sales of Goods Royalties Income Payments P1 ,240,975,363.33 19,570,110.87 1 ,429,455.32 75,565,624.90 7,333,857.86 102,952.66 Income Tax Withheld P62,032,657.07 344,114.09 142,945.54 5,613,937.49 73,338.58 20,590.53 Total P1.344.977.364.94 P68.227.583.31 The details of the income payments in the total amount of P1,344,977,364.94 with their corresponding income taxes withheld is shown also in Annex "A". Apparently, the income from lease of properties in the amount of P1,221,741,087.00, and the rent income of P16,463,321.00, totalling to P1,238,204,408.00, as reflected in petitioner's 2002 income tax return is lower by P2,770,955.33 than the rental income of P1,240,975,363.33, as shown in the certificates. In her Sworn Statement dated June 23, 2006 (Exhibit "FF"), petitioner's Senior Accounting Manager, Cornelia Naguit, explained the nature of the discrepancy, as follows: "The discrepancy was primarily due to the adjustment of the rental income billed to McGeorge for the 4th quarter of CY 2002. As you are aware, Me George was merged with GADC on November 28, 2002. For this reason, the rentals due from McGeorge for the period November 28, 2002 to December 31, 2002 amounting to P7,748,628.29 were reversed since GADC and Me George were merged into one corporation. Aside from the adjustment of the company's rental income from McGeorge, we have already accrued the rental income from lessees such as GENOSI, HA VI Food, Aurora Trading, Expression ~ Stationery, Filemon Pascua and Leopolda Bartolome, even though the rentals have not yet been collected and the Creditable Withholding Tax Certificates have not yet been received. Lastly, rentals due from franchisees amounting to P2,994,255.30 have already been reported as part of our gross revenues in CY 2001. However, we only received the Creditable Withholding Tax Certificates from our franchisees in CY 2002 when they paid the rentals."

16 To corroborate the testimony of Ms. Naguit, petitioner submitted the Schedule of Rent Income for the year 2002 (Exhibit "Y") with attached Schedule of Rent Income from McGeorge Food Ind., Inc. (Exhibit "Z''), Certificates of Creditable Tax Withheld at Source for taxable year 2002 (Exhibits "CC", "DD", "EE", "EE-2", "EE-3", "EE-4"), income tax return for taxable year 2001, and the corresponding Certificates of Creditable Tax Withheld at Source for 2001 (Exhibits "MM" & "NN"). However, the Court finds the aforesaid documents insufficient because the discrepancy of P2,770,955.33 cannot be traced as forming part of petitioner's declared taxable gross income in 2002 or prior year 2001. Thus, with respect to this amount petitioner failed to comply with the third requisite that to be entitled for refund the income upon which the taxes were withheld was included as part of the gross income. Therefore, out of the claimed creditable withholding taxes of P62,032,657.07, pertaining to the rental mcome payments of P1,240,975,363.33, the amount of P138,547.77, corresponding to the (}fP 17 discrepancy in rental income of P2,770,955.33, computed as follows, 1s hereby disallowed:

Per ITR Per Certificates Discrepancy Lease of Properties Rent Income P1 ,221 ,741 ,087.00 16.463,321 .00 Total Rent Income P1 ,238,204,408.00 P1 ,240,975,363.33 P 2,770,955.33 Multiply by 5% w/holding tax rate Disallowed Creditable Withholding Taxes X 0.05 p 138 547 77 Also, the Court finds that petitioner's income from sale of services m the amount of Pl 0,922,502.00, as reflected in its 2002 income tax return, is lower by P/ 0,077,064.19, when compared with the professional fees and contractor's fees, as shown in the certificates in the respective amounts of P1,429,455.32 and P19,570,110.87, or in the sum of P20,999,566.19. For petitioner's failure to account for the discrepancy of P10,077,064.19, the related creditable withholding taxes in the amount of P233,725.30, as computed below, are also disallowed from petitioner's claim for refund:

Income from sale of services per certificates Payments to prime contractors/sub-contractors Professional fees Total Less: Income from sale of services per income tax return Discrepancy in income Percentage of discrepancy to total income per certificates Multiply by: Creditable Taxes Withheld per Certificates Payments to prime contractors/sub-contractors Professional fees Disallowed creditable withholding taxes P344,114.09 P19,570, 110.87 1,429,455.32 P20,999,566.19 10,922,502.00

P10 077 064 19

47.987% 142,945.54 487,059.63 p 233.725.30

18 As regards petitioner's sale of real property other than capital assets in the amount of P ,565,624.90 pertaining to the claimed creditable withholding taxes ofP5,613,937.49, the same allegedly formed part of petitioner's reported gain on sale of restaurant business in the amount of P28,723,821.00, as testified to by petitioner's Senior Accounting Manager, Cornelia Naguit, on direct examination, to wit: Q.

Based on the Summary of GADC's Creditable Withholding Tax Certificates for CY 2002 marked as Exhibit "U", GADC derived income from sale of real property in the total amount of P75,565,625.00, and creditable withholding taxes at the rate of 6% and 7.5% amounting to P5,613,937.50 were withheld therefrom. In what portion ofGADC's Amended Annual Income Tax Return for CY 2002 (Exhibit "B") is the income from sale of real properties reported? A.

The company's income from sale of real properties is reported in Line 54 of the Annual Income Tax Return for CY 2002, pertaining to "gain on sale of restaurant businesses." Q.

Can you please explain why the "gain on sale of restaurant businesses" reported on Line 54 is only P28,723,821.32, while the company's total income from sale of real properties as shown in the Creditable Withholding Tax Certificates is P75,565,625.00. A.

The amount of gain on sale of restaurant businesses reported in Line 54 of the Annual Income Tax Return for CY 2002 is based on the excess of selling price over the net book value of the property.

On the other hand, the tax base for the creditable withholding taxes is the higher of (1) the consideration stated in the sales document, or (b) the fair market value ofthe property. Q.

For this reason, the tax base shown in the CWT Certificates does not tally with the amount of income reported in GADC's Annual Income Tax Return for CY 2002. Do you confirm that the amount of P28, 723,821.32, representing "gain on sale of restaurant businesses," pertains to the net gain on the sale of real properties in 2002.

A.

The net gain on sale of real properties, particularly restaurants, represent approximately 80% of the P28, 723,821.32. The remaining 20% pertains to the retirement of various properties of the company in 2002.

Q.

In any case, are the creditable withholding taxes on GADC's income from sale of real properties supported by Certificates of Creditable Tax Withheld at Source (BIR Form 2307)? A.

Yes. As a matter of fact, the CWT Certificates covering the P5,613,937.50 creditable withholding taxes on sale of real properties other than capital asset has already been presented to the Court and marked as petitioner's Exhibits "L-40." "L-41 ", "L-42", "0-19", "0-74", "0-75", "0-76", "0-77", "0-163", "0- 167" and "0-213".

Q.

Can you please explain to us the nature ofthese transactions. A:

The "gain on sale of restaurant businesses" pertains to the sale of McDonald's Restaurants - particularly, the building or leasehold improvements, equipment, signage, seating and decor of the said restaurants - to our franchisees during the year. In 2002, our franchisees HRA Foods, Angel of Hope Food Enterprises, Noemi Concepcion, Ordo Food Enterprises (Ma. Jose Ordoveza), and 3k Golden Foods Corporation purchased the McDonald's Restaurants located at Metropolis-Aiabang, Vigan- IIocos Sur, Santiago-Isabela, Sta.

Cruz-Laguna, and E.

Rodriguez-Quezon City, respectively. These restaurants were previously owned and operated by GADC. The gain realized on the sale of the five (5) McDonald's Restaurants were reported as part of GADC's "gain on sale of restaurant businesses," as shown in Line 54 of the Annual Income Tax Return for CY 2002." (Exhibit "QQ ''). 19 To prove the computation of the reported gain on sale of restaurant business for the year 2002 in the amount of P28,723,821.00, petitioner presented a schedule summarizing in detail the selling price, acquisition cost, accumulated depreciation, net book value, other cost and gain/loss earned for each property sold (Exhibit "RR ''). However, other than the 20 Deed of Sale (Exhibit "GG-4 ") pertaining to the McDonald's store located in Vigan and Withholding Tax Remittance Returns (Exhibits "II", "JJ", "KK" and "LL), which reflected the selling prices of the properties sold, petitioner failed to submit the underlying documents upon which the figures indicated in the schedule, i.e., acquisition cost, accumulated depreciation and other costs, were based. Thus, this Court cannot ascertain whether the gain on sale related to the claimed creditable withholding taxes of P5,613,937.49 actually formed part of petitioner's taxable income for the year 2002. Accordingly, this Court denies petitioner's claimed creditable withholding taxes in the amount of P5,613,937.49.

As regards the sales of goods in the amount of corresponding to the claimed creditable taxes withheld of P73,338.58, petitioner's witness, Ms. Cornelia Naguit, on direct examination testified that the same pertains to food, paper and other restaurant supplies, such as hamburger patties, marinated chicken, French fries, ketchup, disposable spoons and forks, drinking cups, sanitizer, linen, etc., which were sold to petitioner's franchisees at cost, thus, no income was derived therefrom. (Exhibit "X''). The sales were allegedly recorded in petitioner's books of accounts, as decreases in inventory (Exhibit "X"). Again, the Court finds 21 such testimony, unsupported by documentary proof, insufficient to establish petitioner's claim. Thus, the Court disallows the claimed creditable taxes withheld ofP73,338.58. The same holds true as regards the royalties received by petitioner in the amount of Pl 02,9 2.66 with the corresponding creditable taxes withheld of P20,590.53. Petitioner's witness, Ms. Cornelia Naguit, on direct examination, testified that the amount ofP102,952.66 was reported as part of petitioner's income from "Sale of Services" amounting to Pl 0,922,502.00, as shown in Line 36 of its Annual Income Tax Return. (Exhibit "FF").

Without documentary evidence to corroborate her statement, the claimed creditable taxes withheld of P20,590.53 cannot be granted.

As regards the third requisite, petitioner has complied with the· same, but only to the extent of P62,147,443.64 out of the total claimed creditable withholding taxes of P68,227,583.31 with valid certificates, computed as follows:

Claimed creditable taxes withheld w/ proper certificates Less:

a.

Creditable taxes withheld pertaining to the discrepancy in rental income per income tax return and per certificates b.

Creditable taxes withheld pertaining to petitioner's sales of real property other than capital assets c.

Creditable taxes withheld pertaining to the discrepancy in sales of seNices per income tax return and per certificates d.

Creditable taxes withheld pertaining to petitioner's sales of goods in the amount of P7,344,766.95 p 138,547.77 5,613,937.49 P68,227,583.31 233,725.30 73 ,338~ e.

Creditable taxes withheld pertaining to the royalties received by petitioner in the amount of P1 02,952.66 Claimed creditable taxes withheld pertaining to petitioner's declared income per income tax return 20,590.53 22 6.080,139.67

P62 147 443 64

In sum, the Court finds petitioner to have sufficiently established its entitlement for the refund/tax credit of its unutilized creditable taxes withheld for the taxable year 2002, but in the reduced amount of P49,921,610.64, computed as follows: Sales/Revenue/Receipts/Fees Less:

Cost of Sales/Services Gross Income from Operation Add:

Non-Operating & Other Income Total Gross Income Less:

Deductions Taxable Income Minimum Corporate Income Tax (MCIT) Due Less:

Tax Credits Substantiated Creditable Taxes Withheld during the year2002 Refundable Excess Tax Credits P1,804,896,014.00 1,262,708.484.00 p 542,187,530.00 69,104,118.00 p 611,291,648.00 611 .291,648.00 p 12,225,833.00 62 147 443.64 p 49 921 610 64 Finally, We reiterate the well entrenched rule in jurisprudence that actions for tax refund, as in the instant case, are in the nature of a claim for exemption and the law is not only construed in strictissimi juris against the taxpayer, but also the pieces of evidence presented entitling a taxpayer to an exemption are strictissimi scrutinized and must be duly proven.

23

WHEREFORE, premises considered, the present Petition for Review is PARTIALLY GRANTED. Accordingly, respondent is hereby ORDERED TO REFUND OR TO ISSUE A TAX CREDIT CERTIFICATE in favor of petitioner the reduced amount of P49,921,610.64, representing the unutilized creditable withholding taxes for the calendar year 2002.

WE CONCUR:

Q441A~ Q ~~I

Q..

JliANITO C. CAST ANEDA,t1.ffi. Associate Justice • E~UY As~~tice ATTESTATION I attest that the conclusions in the above Decision were reached in consultation before the cases were assigned to the writer of the opinion of the Court's Division. Associate Justice Chairperson, Second Division

CERTIFICATION 24 Pursuant to Article VIII, Section 13 of the Constitution, and the Division Chairman's Attestation, it is hereby certified that the conclusions in the above Decision were reached in consultation before the cases were assigned to the writer of the opinion of the Court's Division. L~. ~ ERNESTO D. ACOSTA Presiding Justice

GOLDEN ARCHES DEVELOPMENT CORPORATION

SCHEDULE OF CREDITABLE TAXES WITHHELD

FOR THE YEAR ENDING DECEMBER 31, 2002 EXHIBIT

WITHHOLDING AGENT/PAYOR

Rentals- Real Property {5%} I-1 Alfonso Ng I-2 Alfonso Ng I-3 Alfonso Ng

I -4

Alfonso Ng I-5 Ancel A Corporation

I -6

Ancel A Corporation

I -7

Clark Mac Enterprises I-8 Blue Dairy Corporation I-9 Cebu Golden Food Industries, Inc. I-10 Cebu Golden Food Ventures, Inc. I-11 Davao City Food Industries, Inc.

I -12

Edsa Food Industries, Inc. I-13 Geneva Food Inc.

I-14 Giant Arches Food Corp.-Session Rd. I-15 Giant Arches Food Corp.-Centermall I-16 Giant Arches Food Corp.-Baguio Sunshine I-17 Golden Laoag Foods Corp. I-18 Golden City Food Industries, Inc. I-19 HAVI Food Services Phils., Inc. I-20 HRA Foods I-21 Johnarches Foods I-22 Marie! Food Corp.-Baliuag I-23 Marie! Food Corp.-Pulilan I-24 Mary Gocheco-Commonwealth I-25 Mary Gocheco-Ever Gotesco I-26 McColby's Inc.-CSI Urdaneta-Pass Thru I-27 McColby's Inc.-CSI Urdaneta I-28 McColby's Inc.-Dagupan1-Pass Thru I-29 McColby's Inc.-Dagupan1 I-30 McColby's Inc.-Lucao-Pass Thru I-31 McColby's Inc.-Lucao I-32 McDaniels Food Corp.

I-33 McGeorge Food Industries, Inc. I-34 McDonald's Restaurant-Balanga I-35 McDonald's Alaminos I-36 MeAnt Food Service I-37 MeAnt Food Service I-38 Retire Golden Foods, Inc. I-39 Nee Mee Food Corp.

I-40 Nestor dela Merced II-Guadalupe-Pass Thru I-41 Nestor dela Merced II-Guadalupe I-42 Nestor dela Merced II-Pass Thru I-43 Nestor dela Merced II I-44 QSC & V Food Services(San Mateo) I-45 QSC & V Food Services(Sumulong) I-46 Ontiveros, Cyrus Ren Balubai-Tuguegarao I-47 Ontiveros, Cyrus Ren Balubai-Tuguegarao

I -48

PQS Enterprises p

INCOME PAYMENT

373,778.91 p 487,038.59 697,601.35 433,848.05 1,053,009.84 651,183.91 261,389.60 500,000.01 1,165,154.40 1,633,415.00 1,132,553.04 1,546,950.48 773,151.98 1,978,725.27 817,179.26 706,739.27 989,592.53 377,470.36 2,500,000.40 805,835.90 682,302.30 554,445.16 389,777.80 725,822.99 462,311.55 741,839.49 104,007.27 188,807.28 621,930.27 269,325.00 408,102.98 719,627.84 264,837,454.40 1,244,487.45 1,663,903.04 807,739.80 911,741.91 631,653.40 1,432,478.67 443,041.29 137,400.27 851,593.92 69,853.52 522,095.29 1,035,693.57 261,933.15 288,672.81 951,957.24 ANNEXA

INCOME TAX

WITHHELD 18,688.95 24,351.93 34,880.07 21,692.41 52,650.50 32,559.20 13,069.48 25,000.00 58,257.72 81,670.75 56,627.69 77,347.52 38,657.60 98,936.26 40,858.96 35,336.97 49,479.63 18,873.52 125,000.02 40,291.79 34,115.12 27,722.26 19,488.89 36,291.15 23,115.58 37,091.97 5,200.36 9,440.36 31,096.51 13,466.25 20,405.15 35,981.39 13,241,872.72 62,224.37 83,195.15 40,386.99 45,587.10 31,582.67 71,623.94 22,152.06 6,870.01 42,579.70 3,492.67 26,104.76 51,784.65 13,096.65 14,433.63 47,597.86 w page 1 of 11 EXHIBIT

WITHHOLDING AGENT/PAYOR

I-49 Ranola, Alan Ong I-50 VZG Food Industries, Inc. L-1 Ranola, Alan Ong L-2 Alfonso Ng L-3 Alfonso Ng L-4 Alfonso Ng

L -5

Alfonso Ng L-6 Ancel A Corporation

L -7

Ancel A Corporation L-8 Ancel A Corporation L-9 Clark Mac Enterprises L-10 Clark Mac Enterprises L-11 Blue Dairy Corporation L-12 Cebu Golden Food Industries, Inc. L-13 Cebu Golden Food Industries, Inc. L-15 Cebu Golden Food Ventures, Inc. L-16 Davao City Food Industries, Inc.

L -17

Geneva Food Inc.

L-18 Geneva Food Inc.

L-19 Giant Arches Food Corp.-Session Rd. L-20 Giant Arches Food Corp.-Session Rd. L-21 Giant Arches Food Corp.-Session Rd. L-22 Giant Arches Food Corp.-Session Rd. L-23 Giant Arches Food Corp.-Session Rd. L-24 Giant Arches Food Corp.-Centermall L-25 Giant Arches Food Corp.-Centermall L-26 Giant Arches Food Corp.-Centermall L-27 Giant Arches Food Corp.-Baguio Sunshine L-28 Giant Arches Food Corp.-Baguio Sunshine L-29 Glenn Lim L-31 Golden Laoag Foods Corp. L-32 Golden Laoag Foods Corp. L-33 Golden Laoag Foods Corp. L-34 Golden City Food Industries, Inc. L-35 Golden South Foods, Inc. L-36 Golden South Foods, Inc. L-37 HAVI Food Services Phils., Inc. L-38 HRA Foods L-39 HRA Foods L-43 Jessica Golayan Lim L-44 Jessica Golayan Lim L-45 Johnarches Foods L-46 Mariel Food Corp.-Baliuag L-47 Mariel Food Corp.-Pulilan L-48 Mary Gocheco-Commonwealth L-49 Mary Gocheco-Ever Gotesco L-50 McColby's Inc.-CSI Urdaneta-Pass Thru L-51 McColby's Inc.-CSI Urdaneta L-52 McColby's Inc.-Dagupan1-Pass Thru L-53 McColby's Inc.-Dagupan1 L-54 McColby's Inc.-Lucao-Pass Thru L-55 McColby's Inc.-Lucao L-56 McColby's Inc.-Aiaminos

INCOME PAYMENT

962,735.00 593,046.05 853,510.45 373,778.91 420,118.53 693,767.48 424,938.97 886,302.96 1,799,678.66 676,554.01 232,967.80 252,868.00 500,000.01 101,978.40 384,470.80 1,209,859.20 1,114,546.87 739,952.41 255,612.73 666,661.29 668,725.43 593,370.78 287,655.12 539,664.63 269,521.65 291,700.80 235,479.57 502,629.97 213,157.04 1,592,522.24 667,375.98 344,773.29 336,707.38 394,012.24 2,198,660.14 2,538,471.59 3,143,302.00 879,583.58 281,971.50 825,251.73 953,409.79 424,848.68 537,109.89 393,337.90 754,866.60 455,426.22 823,221.97 104,007.27 198,247.65 663,934.59 269,325.00 485,657.10 1,580,011.04 ANNEXA

INCOME TAX

WITHHELD 48,136.75 29,652.31 42,675.53 18,688.95 21,005.93 34,688.37 21,246.95 44,315.15 89,983.93 33,827.70 11,648.39 12,643.40 25,000.00 5,098.92 19,223.54 60,492.96 55,727.34 36,997.62 12,780.64 33,333.06 33,436.27 29,668.54 14,382.76 26,983.23 13,476.08 14,585.04 11,773.98 25,131.50 10,657.85 79,626.11 33,368.80 17,238.66 16,835.37 19,700.61 109,933.01 126,925.16 157,165.10 43,979.18 14,098.58 41,262.58 47,670.48 21,242.43 26,855.50 19,666.90 37,744.33 22,771.31 41,161.10 5,200.36 9,912.38 33,196.73 13,466.25 24,282.86 79,000.55 @# page 2 of 11 EXHIBIT L-57 L-61 L-62 L-63 L-64 L-65 L-66 L-67 L-68 L-69 L-70 L-71 L-72 L-73 L-74 L-75 L-76 L-77 L-78 L-79 L-80 L-81 L-82 L-83 L-84 L-85 L-86 L-87 L-88 L-89 L-90 L-91 L-92 L-93 L-94 L-95 L-96 L-97 L-98 L-99 L-100 L-101 L-102 L-103 L-104 L-105 L-106 L-107 L-108 N-3 N-4 N-5 N-6

WITHHOLDING AGENT/PAYOR

McDaniels Food Corp.

McGeorge Food Industries, Inc. McGeorge Food Industries, Inc. McGeorge Food Industries, Inc. McGill Food Industries, Inc. McGill Food Industries, Inc. McPhilips Food Industries, Inc.-Baclaran McPhilips Food Industries, Inc.-Baclaran McPhilips Food Industries, Inc.-Baclaran McPhilips Food Industries, Inc.-La Salle McPhilips Food Industries, Inc.-La Salle McPhilips Food Industries, Inc.-La Salle McDonald's Restaurant-Balanga McDonald's Restaurant-Balanga McDonald's Restaurant-Balanga MeAnt Food Service MeAnt Food Service MeAnt Food Service MeAnt Food Service Retiro Golden Foods, Inc. Nee Mee Food Corp.

Nee Mee Food Corp.

Nestor dela Merced II-Guadalupe-Pass Thru Nestor dela Merced II-Guadalupe-Pass Thru Nestor dela Merced II-Pass Thru Nestor dela Merced II-Pass Thru QSC & V Food Services(San Mateo) QSC & V Food Services(San Mateo) QSC & V Food Services(San Mateo) QSC & V Food Services(San Mateo) QSC & V Food Services(Sumulong) QSC & V Food Services(Sumulong) QSC & V Food Services(Sumulong) QSC & V Food Services(Sumulong) Teresita Borbon Ababao (Batangas City) Teresita Borbon Ababao (Batangas City) Teresita Borbon Ababao (Bauan) Teresita Borbon Ababao (Bauan) Teves, Lyndon Teves, Lyndon Teves, Lyndon Teves, Lyndon Ontiveros, Cyrus Ren Balubai-Tuguegarao Ontiveros, Cyrus Ren Balubai-Tuguegarao SPF Food VZG Food Industries, Inc. VZG Food Industries, Inc. VZG Food Industries, Inc. VZG Food Industries, Inc. Alfonso Ng Alfonso Ng Alfonso Ng Alfonso Ng

INCOME PAYMENT

804,470.87 89,264,010.00 82,079,404.40 86,739,487.00 791,980.92 762,032.68 1,974,408.56 979,901.05 306,284.81 1,056,897.00 992,627.71 410,500.87 809,250.35 409,120.92 419,768.90 878,453.35 265,672.49 900,582.77 268,950.46 426,065.20 1,508,143.20 485,964.38 471,426.43 166,244.66 926,669.67 329,114.04 168,337.28 179,200.72 73,312.37 185,975.55 342,312.43 373,798.72 261,170.35 275,753.78 1,045,064.94 1,083,014.15 767,691.39 866,683.72 540,673.20 304,324.40 388,300.80 300,121.00 313,791.09 293,569.43 1,351,977.64 188,397.03 195,584.94 194,950.57 207,308.01 373,778.91 506,930.36 739,513.77 487,621.43 ANNEXA

INCOME TAX

WITHHELD 40,223.54 4,463,200.50 4,103,970.72 4,336,974.35 39,599.07 38,101.64 98,720.43 48,995.05 15,314.24 52,844.85 49,631.39 20,525.04 40,462.51 20,456.05 20,988.45 43,922.67 13,283.62 45,029.14 13,447.52 21,303.26 75,407.16 24,298.22 23,571.33 8,312.23 46,333.48 16,455.70 8,416.87 8,960.04 3,665.62 9,298.78 17,115.62 18,689.94 13,058.52 13,787.69 52,253.25 54,150.71 38,384.56 43,334.18 27,033.66 15,216.22 19,415.04 15,006.05 15,689.55 14,678.45 67,598.88 9,419.86 9,779.25 9,747.53 10,365.41 18,688.95 25,346.52 36,975.69 24,381.08 page3of 11 EXHIBIT N-7 N-8 N-9 N-10 N-11 N-12 N-13 N-14 N-15 N-16 N-17 N-18 N-19 N-20 N-21 N-22 N-23 N-24 N-25 N-26 N-27 N-28 N-29 N-30 N-31 N-32 N-33 N-36 N-37 N-38 N-41 N-42 N-43 N-44 N-45 N-46 N-47 N-48 N-49 N-50 N-51 N-52 N-53 N-54 N-55 N-56 N-57 N-58 N-59 N-60 N-61 N-62 N-63

WITHHOLDING AGENT/PAYOR

Ancel A Corporation Clark Mac Enterprises Clark Mac Enterprises Blue Dairy Corporation Cebu Golden Food Industries, Inc. Davao City Food Industries, Inc. Edsa Food Industries, Inc. Edsa Food Industries, Inc. Geneva Food Inc.

Geneva Food Inc.

Geneva Food Inc.

Giant Arches Food Corp.-Session Rd. Giant Arches Food Corp.-Session Rd. Giant Arches Food Corp.-Session Rd. Giant Arches Food Corp.-Centermall Giant Arches Food Corp.-Centermall Giant Arches Food Corp.-Centermall Giant Arches Food Corp.-Centermall Giant Arches Food Corp.-Baguio Sunshine Giant Arches Food Corp.-Baguio Sunshine Giant Arches Food Corp.-Baguio Sunshine Glenn Lim Glenn Lim Golden Laoag Foods Corp. Golden Laoag Foods Corp. Golden Laoag Foods Corp. Golden City Food Industries, Inc. Golden South Foods, Inc. Golden South Foods, Inc. Golden South Foods, Inc. HRA Foods Marie! Food Corp.-Baliuag Marie! Food Corp.-Pulilan Mary Gocheco-Commonwealth Mary Gocheco-Ever Gotesco DLC Foods, Inc.-Meycauayan DLC Foods, Inc.-Meycauayan DLC Foods, Inc.-Valenzuela DLC Foods, Inc.-Valenzuela DLC Foods, Inc.-Balagtas,Bulacan DLC Foods, Inc.-Balagtas,Bulacan McGeorge Food Industries, Inc. McGill Food Industries, Inc. McGill Food Industries, Inc. McDonald's Restaurant-Balanga McDonald's Restaurant-Balanga MeAnt Food Service MeAnt Food Service MeAnt Food Service MeAnt Food Service MeAnt Food Service MeAnt Food Service Nee Mee Food Corp.

INCOME PAYMENT

868,135.92 205,302.20 104,292.94 500,000.01 354,762.40 1,178,222.51 1,118,950.88 2,278,209.38 204,198.89 238,969.24 231,331.25 660,229.56 640,811.87 600,288.71 273,095.07 311,639.26 282,208.74 273,302.66 242,296.72 233,359.79 249,344.96 1,459,930.76 1,746,818.94 322,182.19 339,296.50 314,956.93 402,918.99 730,903.53 601,957.39 696,446.10 326,212.23 585,963.62 424,917.09 780,183.91 459,611.83 440,084.25 446,333.68 981,124.66 1,150,748.28 1,793,819.71 1,379,522.14 283,229,262.00 469,169.97 383,744.67 460,509.85 425,381.32 302,938.92 320,945.14 334,335.88 311,553.66 297,242.70 303,520.35 541,985.21 ANNEXA

INCOME TAX

WITHHELD 43,406.80 10,265.11 5,214.65 25,000.00 17,738.12 58,911.12 55,947.54 113,910.47 10,209.94 11,948.46 11,566.56 33,011.48 32,040.59 30,014.44 13,654.75 15,581.96 14,110.43 13,665.13 12,114.84 11,667.99 12,467.25 72,996.54 87,340.95 16,109.11 16,964.83 15,747.85 20,145.95 36,545.18 30,097.87 34,822.31 16,310.61 29,298.18 21,245.85 39,009.19 22,980.59 22,004.21 22,316.69 49,055.73 57,537.42 89,690.99 68,976.12 14,161,463.10 21,325.92 19,187.24 23,025.49 21,269.07 15,146.95 16,047.26 16,716.79 15,577.68 14,862.14 15,176.02 27,099.26 page 4 of 11 EXHIBIT N-64 N-65 N-66 N-67 N-68 N-69 N-70 N-71 N-72 N-73 N-74 N-75 N-76 N-77 N-78 N-79 N-80 N-81 N-82 N-83 N-84 N-85 N-86 N-87 N-88 N-89 N-90 N-1 N-91 N-92 N-93 N-94 N-95 N-96 N-97 N-98 N-99 N-100 N-101 N-102 N-103 0 -4 0 -5 0 -6 0 -8 0-9 0 -12 0 -15 0 -16 0 -18 0 -20 0 -21 0 -22

WITHHOLDING AGENT/PAYOR

Nee Mee Food Corp.

Nee Mee Food Corp.

Nee Mee Food Corp.

Nestor dela Merced II-Guadalupe-Pass Thru Nestor dela Merced II-Guadalupe-Pass Thru Nestor dela Merced II-Guadalupe Nestor dela Merced II-Pass Thru Nestor dela Merced II-Pass Thru QSC & V Food Services(San Mateo) QSC & V Food Services(San Mateo) QSC & V Food Services(San Mateo) QSC & V Food Services(San Mateo) QSC & V Food Services(San Mateo) QSC & V Food Services(Sumulong) QSC & V Food Services(Sumulong) QSC & V Food Services(Sumulong) Teresita Borbon Ababao (Batangas City) Teresita Borbon Ababao (Bauan) Teves, Lyndon Teves, Lyndon PQS Enterprises PQS Enterprises PQS Enterprises PQS Enterprises PQS Enterprises PQS Enterprises PQS Enterprises Ranola, Alan Ong SPF Food SPF Food SPF Food SPF Food SPF Food SPF Food SPF Food VZG Food Industries, Inc. VZG Food Industries, Inc. VZG Food Industries, Inc. J&F Food Corp.

J&F Food Corp.

J&F Food Corp.

Ranola, Alan Ong Ranola, Alan Ong Ranola, Alan Ong Ranola, Alan Ong Ranola, Alan Ong Alfonso Ng Alfonso Ng Alfonso Ng Alfonso Ng Angel of Hope Food Enterprises Angel of Hope Food Enterprises Angel of Hope Food Enterprises

INCOME PAYMENT

601,577.35 493,599.78 512,615.54 366,115.04 147,500.00 170,903.10 705,895.70 312,731.58 797,977.80 193,891.65 188,606.51 189,099.24 2,087,806.27 316,836.28 296,558.05 323,156.91 1,159,785.13 784,258.32 165,097.66 322,035.40 275,165.63 285,474.68 297,560.04 320,946.67 362,476.84 317,840.45 305,735.53 623,949.05 438,310.50 465,771.76 511,648.82 540,881.97 545,085.73 510,066.37 496,093.95 217,385.39 200,287.50 205,480.27 115,835.33 210,179.25 266,233.21 1,003.20 310,324.86 361,888.23 288,409.74 398,038.53 373,778.91 444,546.97 713,706.39 440,861.59 450,000.00 450,000.00 450,000.00 ANNEXA

INCOME TAX

WITHHELD 28,646.54 24,679.99 25,615.54 18,305.75 7,375.00 8,545.16 35,294.79 15,636.58 39,898.89 9,694.58 9,430.33 9,454.97 104,390.31 15,841.82 14,827.90 16,157.85 57,951.43 39,212.92 8,254.88 16,101.77 13,758.28 14,423.73 14,878.00 16,047.33 18,123.84 15,892.02 15,286.78 31,197.45 21,915.53 23,288.59 25,582.44 27,044.10 27,254.29 25,503.32 24,804.70 10,869.27 10,014.38 10,274.01 5,265.24 10,008.54 12,101.51 50.16 15,516.24 18,094.41 14,420.49 19,901.93 18,688.95 22,227.35 35,685.32 22,043.07 22,500.00 22,500.00 22,500.00 pageS of 11 EXHIBIT 0-23 0-25 0 -26 0-28 0-29 0-32 0-33 0-35 0-38 0-39 0-40 0-43 0-44 0-46 0 -47 0-49 0 -50 0-52 0-56 0-59 0-60 0-61 0-67 0-68 0-69 0-70 0-71 0 -72 0-78 0-79 0-80 0 -81 0-83 0 -84 0-85 0-86 0-88 0-89 0 -91 0-92 0-93 0-94 0 -95 0-96 0-99 0-100 0-101 0-102 0-104 0-105 0-107 0-109 0-110

WITHHOLDING AGENT/PAYOR

Angel of Hope Food Enterprises Angel of Hope Food Enterprises Clark Mac Enterprises Clark Mac Enterprises Blue Dairy Corporation Cebu Golden Food Ventures, Inc. Cebu Golden Food Ventures, Inc. Davao City Food Industries, Inc. Edsa Food Industries, Inc. Geneva Food Inc.

Geneva Food Inc.

Giant Arches Food Corp.-Session Rd. Giant Arches Food Corp.-Session Rd. Giant Arches Food Corp.-Centermall Giant Arches Food Corp.-Centermall Giant Arches Food Corp.-Baguio Sunshine Giant Arches Food Corp.-Baguio Sunshine Glenn Lim Golden City Food Industries, Inc. Golden South Foods, Inc. Golden South Foods, Inc. Golden South Foods, Inc. HAVI Food Services Phils., Inc. HAVI Food Services Phils., Inc. HRA Foods HRA Foods HRA Foods HRA Foods Jessica Golayan Lim Jessica Golayan Lim Johnarches Foods Johnarches Foods (2%) Mariel Food Corp.-Baliuag Mariel Food Corp.-Pulilan Mary Gocheco-Commonwealth Mary Gocheco-Ever Gotesco McColby's Inc.-CSI Urdaneta-Pass Thru McColby's Inc.-CSI Urdaneta-Pass Thru McColby's Inc.-CSI Urdaneta McColby's Inc.-CSI Urdaneta McColby's Inc.-Dagupan1-Pass Thru McColby's Inc.-Dagupan1-Pass Thru McColby's Inc.-Dagupan1 McColby's Inc.-Dagupan1 McColby's Inc.-Lucao-Pass Thru McColby's Inc.-Lucao-Pass Thru McColby's Inc.-Lucao McColby's Inc.-Lucao McColby's Inc.-Aiaminos McColby's Inc.-Aiaminos McColby's Inc.-San Carlos McDaniels Food Corp.

McDaniels Food Corp.

INCOME PAYMENT

531,883.26 140,578.38 128,829.87 113,235.79 499,999.80 1,024,077.00 2,784,824.00 1,229,470.40 606,035.14 259,124.32 264,383.30 550,348.50 659,740.03 257,897.77 299,311.76 231,837.21 262,076.34 1,580,320.45 377,755.62 664,333.20 751,958.09 692,332.40 2,500,000.20 2,500,000.60 303,141.32 317,594.08 283,903.00 403,605.57 1,090,768.95 1,103,153.09 378,175.48 437,170.77 576,694.14 425,375.58 777,357.44 495,636.34 766,190.56 846,129.67 104,007.27 104,007.27 198,247.65 198,247.65 610,436.07 616,343.64 269,325.00 269,325.00 440,695.04 492,878.48 1,489,944.56 1,637,946.57 682,144.29 830,890.93 804,179.97 ANNEXA

INCOME TAX

WITHHELD 26,594.16 7,028.92 6,441.49 5,661.79 24,999.99 51,203.85 139,241.20 61,473.52 30,301.76 12,956.22 13,219.17 27,517.43 32,987.00 12,894.89 14,965.59 11,591.86 13,103.82 79,016.02 18,887.78 33,216.66 37,597.90 34,616.62 125,000.01 125,000.03 15,157.07 15,879.70 14,195.15 20,180.28 54,538.44 55,157.65 18,908.77 8,743.42 28,834.72 21,268.79 38,867.88 24,781.82 38,309.53 42,306.48 5,200.36 5,200.36 9,912.38 9,912.38 30,521.80 30,817.18 13,466.25 13,466.25 22,034.75 24,643.92 74,497.23 81,897.33 34,107.21 41,544.55 40,208.99 pnge 6 of 11 EXHIBIT 0-112 0-113 0-114 0-115 0-116 0-117 0-118 0-119 0-120 0-121 0-122 0-123 0-124 0-125 0-126 0-127 0-128 0-129 0-130 0-131 0-132 0-133 0-134 0-135 0-136 0-137 0-138 0-140 0-141 0-142 0-143 0-144 0-145 0-146 0-147 0-148 0-149 0-150 0-151 0-152 0-154 0-155 0-156 0-157 0-158 0-159 0-160 0-161 0-162 0-168 0-169 0-170 0-171

WITHHOLDING AGENT/PAYOR

DLC Foods, Inc.-Meycauayan DLC Foods, Inc.-Valenzuela DLC Foods, Inc.-Balagtas,Bulacan Miriam Bernardo Arguelles-Bifian1 Miriam Bernardo Arguelles-Bifian1 Miriam Bernardo Arguelles-Bifian1 Miriam Bernardo Arguelles-Bifian1 Miriam Bernardo Arguelles-Bifian2 Miriam Bernardo Arguelles-Bifian2 Miriam Bernardo Arguelles-Bifian2 Miriam Bernardo Arguelles-Bifian2 McGill Food Industries, Inc. McGill Food Industries, Inc. McGill Food Industries, Inc. McJola, Inc.

McJola, Inc.

McJola, Inc.

McJola, Inc.

Lopez, Eusebio Soriano Lopez, Eusebio Soriano Lopez, Eusebio Soriano Lopez, Eusebio Soriano McPhilips Food Industries, Inc.-Baclaran McPhilips Food Industries, Inc.-La Salle McDonald's Restaurant-Balanga McDonald's Restaurant-Balanga McDonald's Restaurant-Balanga MeAnt Food Service MeAnt Food Service MeAnt Food Service MeAnt Food Service Retire Golden Foods, Inc. Retire Golden Foods, Inc. Retire Golden Foods, Inc. Retire Golden Foods, Inc. Retire Golden Foods, Inc. Nee Mee Food Corp.

Nee Mee Food Corp.

Nestor dela Merced 11-Guadalupe-Pass Thru Nestor dela Merced 11-Guadalupe-Pass Thru Nestor dela Merced 11-Guadalupe Noemi Cabuay-Rosario, Cavite Noemi Cabuay-Rosario, Cavite Noemi Cabuay-Rosario, Cavite Noemi Cabuay-Binakayan Noemi Cabuay-Binakayan Noemi Cabuay-Binakayan Noemi Cabuay-Binakayan Noemi Concepcion OrdoFood Enterprises QSC & V Food Services(San Mateo) QSC & V Food Services(San Mateo) QSC & V Food Services(Sumulong)

INCOME PAYMENT

457,502.57 1,074,750.21 1,563,353.20 746,907.16 721,440.55 783,004.86 677,623.83 195,000.00 195,000.00 195,000.00 195,000.00 426,518.16 426,518.16 356,720.95 1,626,130.40 1,557,815.00 1,804,862.40 2,419,009.40 1,074,112.00 1,110,652.80 1,268,100.00 1,342,331.60 4,912,983.57 4,302,007.84 423,057.56 374,964.54 452,665.08 272,603.89 348,865.53 333,010.83 335,956.45 225,000.00 201,051.20 546,292.20 225,678.00 243,540.00 471,650.04 495,310.03 20,803.53 165,872.31 580,130.96 751,340.40 973,581.84 917,807.22 720,550.34 779,589.80 798,189.69 769,047.24 538,956.00 260,843.34 172,653.39 192,971.03 303,907.01 -ANNEXA

INCOME TAX

WITHHELD 22,875.13 53,737.51 78,167.66 37,345.37 36,072.02 39,150.24 33,881.19 9,750.00 9,750.00 9,750.00 9,750.00 21,325.92 21,325.92 17,836.05 81,306.52 77,890.75 90,243.12 120,950.47 53,705.60 55,532.64 63,405.00 67,116.58 245,653.28 215,100.39 21,152.88 18,748.23 22,633.25 13,630.19 17,443.28 16,650.54 16,797.82 11,250.00 10,052.56 27,314.61 11,283.90 12,177.00 23,582.50 24,765.50 1,040.18 8,293.62 29,006.55 37,567.02 48,679.08 48,590.36 36,027.51 38,978.48 39,909.48 38,452.36 26,947.80 13,042.17 8,632.67 9,648.55 15,195.35 page 7of11 EXHIBIT

WITHHOLDING AGENT/PAYOR

0-172 QSC & V Food Services(Sumulong) 0 -173 QSC & V Food Services(Masinag) 0-174 Teresita Borbon Ababao (Batangas City) 0-176 Teresita Borbon Ababao (Bauan) 0-178 Teves, Lyndon 0 -179 Teves, Lyndon 0-180 Teves, Lyndon 0 -181 Teves, Lyndon 0-182 Teves, Lyndon 0-184 Teves, Lyndon 0 -185 Ontiveros, Cyrus Ren Balubai-Tuguegarao 0-186 Ontiveros, Cyrus Ren Balubai-Tuguegarao 0-187 PQS Enterprises 0 -188 PQS Enterprises 0-190 RSA Food Service (RFC Molino) 0 -191 RSA Food Service (RFC Molino) 0 -192 RSA Food Service (RFC Molino) 0 -193 RSA Food Service (RFC Molino) 0 -194 RSA Food Service (General Trias) 0-195 RSA Food Service (General Trias) 0-196 RSA Food Service (General Trias) 0-197 RSA Food Service (General Trias) 0-198 SPF Food 0 -199 SPF Food 0 -201 TGY & Kids Inc.

0-202 TGY & Kids Inc.

0-203 TGY & Kids Inc.

0 -204 TGY & Kids Inc.

0 -205 Yaman Kids Corporation 0-206 VZG Food Industries, Inc. 0-207 VZG Food Industries, Inc. 0 -209 J&F Food Corp.

0 -210 J&F Food Corp.

0 -211 J&F Food Corp.

0 -212 J&F Food Corp.

0 -214 3K Golden Foods Corp. R McGeorge Food Industries, Inc. s McGeorge Food Industries, Inc. Total: Rentals - Real Property Payments to Prime Contractors/Sub-contractors (2%} L-32 Golden Laoag Foods Corp. N-2 Ranola, Alan Ong (2%) N-11 Cebu Golden Food Industries, Inc. (2%) N-31 Golden Laoag Foods Corp. (2%) N-34 Golden South Foods, Inc. (1%) N-35 Golden South Foods, Inc. (2%) N-39 Golden South Foods, Inc. (1%) N-40 Golden South Foods, Inc. (1%) 0 -1 Ranola, Alan Ong 0 -2 Ranola, Alan Ong p p

INCOME PAYMENT

295,146.38 69,569.64 1,115,398.84 800,149.75 62,552.40 76,415.60 65,829.40 75,593.00 72,299.60 94,470.40 525,775.53 538,452.23 264,739.61 306,874.71 1,397,544.80 1,467,684.20 1,520,638.00 1,480,937.60 1,072,002.00 1,012,449.40 1,117,926.60 1,071,791.80 485,548.31 487,246.60 1,555,511.02 1,620,849.32 1,772,472.52 651,059.43 1,105,804.19 192,350.24 201,433.13 227,151.04 162,050.59 156,044.13 133,602.95 253,471.25 95,456,478.60 82,800,958.20 1,240,975,363.33 p 18,181.82 p 136,577.06 70,970.00 800.00 174,237.03 71,927.00 2,195.00 146,138.49 147,917.44 144,393.62 ANNEXA

INCOME TAX

WITHHELD 14,757.32 3,478.48 55,769.94 40,007.49 3,127.62 3,820.78 3,291.47 3,779.65 3,614.98 4,723.52 26,291.78 26,922.59 13,236.98 15,343.74 69,877.24 73,384.21 76,031.90 74,046.88 53,600.10 50,622.47 55,896.33 53,590.00 24,277.42 24,362.33 77,775.54 81,042.46 88,623.61 32,552.97 55,290.20 9,617.52 10,071.66 11,357.55 8,102.53 7,802.21 6,680.15 12,673.56 4, 772,823.93 4,140,047.91 62,032,657.07 363.64 2,731.54 1,419.40 16.00 1,742.37 1,438.54 21.95 1,461.38 2,958.34 2,887.87 page 8 of 11 EXHIBIT 0-3 0 -7 0 -10 0-11 0 -14 0 -17 0-24 0 -25 0 -27 0 -28 0 -30 0 -31 0 -33 0 -34 0-35 0-42 0 -45 0-48 0-51 0 -53 0 -54 0 -58 0 -59 0-60 0-62 0-63 0 -66 0 -73 0-82 0-87 0-90 0 -97 0 -103 0 -106 0-108 0-111 0 -118 0 -122 0-125 0-129 0-133 0 -139 0 -141 0 -143 0 -150 0 -153 0 -157 0-161 0 -164 0 -165 0 -166 0-170 0 -172

WITHHOLDING AGENT/PAYOR

Ranola, Alan Ong Ranola, Alan Ong Ranola, Alan Ong Ranola, Alan Ong Alfonso Ng Alfonso Ng Angel of Hope Food Enterprises Clark Mac Enterprises Clark Mac Enterprises Clark Mac Enterprises Cebu Golden Food Industries, Inc. Cebu Golden Food Industries, Inc. Cebu Golden Food Ventures, Inc. Cebu Golden Food Ventures, Inc. Davao City Food Industries, Inc. Geneva Food, Inc.

Giant Arches Food Corp.-Session Rd. Giant Arches Food Corp.-Centermall Giant Arches Food Corp.-Baguio Sunshine Glenn Lim Golden Laoag Foods Corporation Golden City Food Industries, Inc. Golden South Foods, Inc. (1 %) Golden South Foods, Inc. Golden South Foods, Inc. (1 %) Golden South Foods, Inc. Golden South Foods, Inc. (1 %) HRA Foods Johnarches Foods McCarol Ventures McColby's Inc.-CSI Urdaneta-Pass Thru McColby's Inc.-Dagupan1 McColby's Inc.-Lucao McColby's Inc.-Aiaminos McColby's Inc.-San Carlos McDaniels Food Corp.

Miriam Bernardo Arguelles-Biiian1 Miriam Bernardo Arguelles-Biiian2 McGill Food Industries, Inc. McJola, Inc.

Lopez, Eusebio Soriano McDonald's Restaurant-Balanga MeAnt Food Service MeAnt Food Service Nee Mee Food Corp.

Nestor dela Merced II Noemi Cabuay-Rosario, Cavite Noemi Cabuay-Binakayan OrdoFood Enterprises ( 1%) OrdoFood Enterprises OrdoFood Enterprises QSC & V Food Services(San Mateo) QSC & V Food Services(Sumulong)

INCOME PAYMENT

287,819.73 468,356.35 180,926.60 38,967.00 370,455.81 339,124.29 194,126.44 202,934.50 155,699.21 36,850.00 161,879.13 309,316.81 5,515.50 461,996.00 351,954.70 2,135,076.58 286,843.49 213,794.12 252,595.43 207,994.65 255,024.39 629,592.70 2,675.60 1,950.00 26,171.99 85,410.00 3,626,226.69 224,225.32 257,291.60 512,770.97 141,761.14 290,159.14 244,380.22 259,051.47 92,052.68 115,844.77 126,674.18 54,079.96 152,068.29 538,717.00 149,877.00 189,296.48 153,581.91 377,521.56 198,255.38 178,903.52 179,809.26 115,998.89 880,984.00 221,959.50 118,565.15 117,229.42 210,818.85 ANNEXA

INCOME TAX

WITHHELD 5,756.39 9,367.14 3,618.53 779.34 7,409.11 6,782.48 3,882.53 4,058.69 3,113.98 737.00 3,237.58 6,186.34 110.31 9,239.92 7,039.09 42,701.53 5,736.87 4,275.88 5,051.91 4,159.89 5,100.49 12,591.85 26.76 39.00 261.72 1,708.20 36,262.27 4,484.51 5,145.83 10,255.41 2,835.22 5,803.18 4,887.60 5,181.03 1,841.05 2,316.90 2,533.48 1,081.60 3,041.38 10,774.34 2,997.54 3,785.93 3,071.64 7,550.43 3,965.11 3,578.07 3,596.19 2,319.98 8,809.84 4,439.19 2,371.30 2,344.59 4,216.38 {rJf page 9 of 11 ANNEXA

INCOME TAX

EXHIBIT

WITHHOLDING AGENT/PAYOR

INCOME PAYMENT

WITHHELD 0-173 QSC & V Food Services(Masinag) 69,569.64 1,391.39 0 -175 Teresita Borbon Ababao (Batangas City) 182,760.06 3,655.20 0 -177 Teresita Borbon Ababao (Bauan) 146,336.59 2,926.73 0 -183 Teves, Lyndon 157,450.50 3,149.01 0 -189 PQS Enterprises 219,196.22 4,383.92 0-200 SPF Food 165,623.30 3,312.47 0 -208 VZG Food Industries, Inc. 100,856.16 2,017.12 0 -215 3K Golden Foods Corp. 207,598.27 4,151.97 T 16,227.30 1,622.73 Total:

Payments to Prime Contractors/ Subcontractors p 19,570,110.87 p 344,114.09 Professional Fees (10%} 0 -25 Clark Mac Enterprises p 262,611.90 p 26,261.19 0 -27 Clark Mac Enterprises 151,290.90 15,129.09 0-34 Cebu Golden Food Ventures, Inc. 192,676.90 19,267.69 0 -35 Davao City Food Industries, Inc. 173,932.85 17,393.29 0 -57 Golden City Food Industries, Inc. 284,700.00 28,470.00 0 -54 Golden Laoag Foods Corporation 104,366.60 10,436.66 0-64 Golden South Foods, Inc. 73,236.87 7,323.69 0-65 Golden South Foods, Inc. 186,639.30 18,663.93 Total:

Professional Fees p 1,429,455.32 p 142,945.54 Sale of Real Property Other Than Capital Assets {6%} L-40 HRA Foods p 509,374.98 p 30,562.50 L-41 HRA Foods 509,374.98 30,562.50 L-42 HRA Foods 509,374.98 30,562.50 0-19 Angel of Hope Food Enterprises (7.5%) 20,000,000.00 1,500,000.00 0 -74 HRA Foods (6%) 509,374.99 30,562.50 0 -75 HRA Foods (6%) 509,374.99 30,562.50 0 -76 HRA Foods (6%) 509,374.99 30,562.50 0 -77 HRA Foods (6%) 509,374.99 30,562.50 0-163 Noemi Concepcion (7.5%) 13,000,000.00 975,000.00 0 -167 OrdoFood Enterprises (7.5%) 17,000,000.00 1,275,000.00 0 -213 3K Golden Foods Corp. (7.5%) 22,000,000.00 1,650,000.00 Total: Sale of Real Property Other Than Capital Assets p 75,565,624.90 p 5,613,937.49 Sales of Goods {1 %} I-17 Golden Laoag Foods Corp. p 154,300.52 p 1,543.01 L-14 Cebu Golden Food Industries, Inc. 104,976.94 1,049.77 L-32 Golden Laoag Foods Corp. 15,762.79 157.63 L-33 Golden Laoag Foods Corp. 39,000.00 390.00 N-30 Golden Laoag Foods Corp. 190,142.18 1,901.42 0 -37 Davao City Food Industries, Inc. 2,185,085.59 21,850.86 0 -54 Golden Laoag Foods Corp. 818.80 8.19 0-55 Golden Laoag Foods Corp. 4,643,771.04 46,437.71 Total: Sales of Goods p 7,333,857.86 p 73,338.58 (}P page l Oaf 11 @ EXHIBIT Royalties 0 -41 0 -98 Total:

WITHHOLDING AGENT/PAYOR

Geneva Food, Inc. (20°~) McColby's Inc.-Dagupan1 (20%) Royalties

GRAND TOTAL

INCOME PAYMENT

p 44,920.83 58,031.83 p 102,952.66 p 1,344,977,364.94 p p p ANNEXA

INCOME TAX

WITHHELD 8,984.16 11,606.37 20,590.53 68,227,583.31 MY page 11 of 11