Court of Tax Appeals · Third Division

Unisys Public Sector Services Corporation vs. Commissioner of Internal Revenue

CTA Case No. 8293 September 22, 2015

REPUBLIC OF THE PHILIPPINES

COURT OF TAX APPEALS

QUEZON CITY

THIRD DIVISION

UNISYS PUBLIC SECTOR

SERVICES CORPORATION,

Petitioner,

-versus-

C.T.A. CASE NO. 8293

Members:

BAUTISTA, Chairperson ;

FABON-VICTORINO, and

RINGPIS LIBAN, 2L.

COMMISSIONER OF

Promulgated:

INTERNAL REVENUE,

Respondent.

SEP 2 2 2015

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.....

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DECISION

This is a claim for refund or issuance of a tax credit certificate (TCC) in the amount of Seventy-Six Million Ninety-One Thousand Eighty-Seven Pesos and 98/100 (P76,091,087. 98), allegedly representing erroneously paid or illegally collected value-added tax (VAT) for calendar year (CY) 2009 and for the three (3) quarters of CY 2010 filed by petitioner Unisys Public Sector Services Corporation .

THE FACTS

Petitioner Unisys Public Sector Services Corporation is a domestic corporation with address at Level 9 One Cyberpod, Eton Centris Station, EDSA corner Quezon Avenue, Quezon City. It was incorporated on July 14, 1994 with the primary / purpose as follows 1 : ~ "To create, manufacture, process, assemble, fabricate, develop, supply, license,

lease (without engaging in financial leasing), sell at wholesale (for cash or on credit), barter, exchange, trade, make advances upon, import or otherwise acquire, distribute, integrate, market, upgrade or modify computer hardware, computer systems software programs, applications, components, devices and supplies, as well as to provide support, training and Consultancy services in the use and application of these products; to do any and all acts and things in relation to, arising out of and incidental to the creation, manufacturing, processing, assembly, fabrication, development, supply, licensing, leasing, sale, barter, exchange, trade, importation, acquisition, distribution, marketing, upgrading or modification of the aforementioned products, including but not limited to the sale, installation and maintenance of computer hardware, computer systems software programs, applications, components, devices and supplies, as well as to supply, install, maintain and provide management, operational, and technical expertise and other advisory and consultation services." Petitioner is a registered VAT taxpayer with Tax Identification Number (TIN) 003-933-453-000 issued by the Bureau of Internal Revenue (BIR). 2 Respondent, on the other hand, is the Commissioner of Internal Revenue (CIR), with the authority to act on claims for refund or tax credit of erroneously or excessively paid taxes. She holds office at the BIR National Office Building, BIR Road, Diliman, Quezon City. On December 23, 1999, Unisys Australia Limited (UAL), (Philippine Branch) entered into a contract for an estimated period of twelve (12) years with the National Statistics Office (NSO), a government agency responsible for the collection, compilation, classification, production, publication and /

dissemination of general-purpose statistics and civil registry data. The Civil Registry System Information Technology Project (CRS-ITP) Contract3 provides, among others, that UAL would be responsible for the design, development, construction, installation, testing and commissioning of NSO's Civil Registry System-Information Technology (CRS- IT).

On July 1, 2001, UAL and petitioner, with the consent of NSO, executed an Assignment and Assumption Agreement4 (Agreement) by virtue of which UAL unconditionally and irrevocably assigned and transferred to petitioner all its rights, title, benefits, privileges and interests and obligations, undertakings, covenants, liabilities and indebtedness, including any obligation, undertaking, covenant, liability or indebtedness that may have accrued and have not been fully performed or paid as of the date of the Assignment.

For the four quarters of CY 2009 and the succeeding three quarters of CY 2010, petitioner generated gross sales in the amount of P¹,382,319,932.81 5• Petitioner subjected to and withheld five percent (5%) final VAT on its gross sales to NSO pursuant to Section 114{C) of the National Internal Revenue Code (NIRC) of 1997, as amended.

Petitioner filed its VAT Returns for the four quarters of CY 2009 and for the succeeding three quarters of CY 2010 and paid the total amount of P148,031,890.38 on the following dates.

Quarter

(CY 2009)

First First (amended) Second Second (amended) Third Third (amended) 3 Exhibit "N".

4 Exhibit "0".

Date of Filing of VAT Return and payment of VAT April 24, 2009 January 19, 2011 July 23, 2009 January 20, 2011 October 23, 2009 January 20, 2011 5 Exhibits "C" "D" "E" "F" "G" "H" and "I" I I I I I • Exhibit "S" and "S-1" "F" and "F-1" "T" and "T-1" "G" and "G-1" "U" and "U-1" "H" and "H-1" /

Fourth Fourth (amended) Quarter

(CY 2010)

First6 First (amended)7 SecondH Second (amended)" Third 1u Third (amended) 11 January 25, 2009 "V" and "V-1" January 20, 2011 "I" and "I-1" Date of Filing of VAT Return Exhibit and payment of VAT April 26 2010 "W" and "W-1" January 20, 2011 "J" and "J-1" July 26, 2010 "X" and "X-1" January 20, 2011 "K" and "K-1" October 20, 2010 "Y" and "Y -1" January 20 2011 "L" and "L-1" Subsequently, petitioner discovered that it erroneously paid VAT to the BIR when it used its actual accumulated input VAT for the four quarters of the CY 2009 and the succeeding three quarters of CY 2010, instead of the seven percent (7%) standard input VAT in computing the net VAT payable. As a consequence, it overpaid VAT for the cited period in the total amount of P76,091,087.98. On February 11, 2011, petitioner filed with the BIR Large Taxpayers Regular Audit Division III a claim for refund or issuance of a TCC for the alleged erroneously overpaid VAT of P76,091,087.98. 12 On May 30, 2011, petitioner filed the instant Petition for Review claiming inaction on the part of respondent on its application for refund and to suspend the running of the two-year prescriptive period under the law. 13 On July 12, 2011, respondent filed her Answer14 stating that petitioner's claim is subject to routinary examination. In any event, there is no showing that petitioner submitted complete documents pursuant to Revenue Memorandum Order (RMO) No. 53-98 justifying denial of the application by inaction.

Finally, a claim for refund is construed strictly against the claimant for it partakes of the nature of an /

6 Exhibit "D".

7 Exhibit "D".

8 Exhibit "E".

9 Exhibit "F".

10 Exhibit "G".

11 Exhibit "G".

12 Exhibit "C".

13 Docket, pp. 1-12.

14 Docket, pp. 100-108.

exemption from taxation 15 and as such, it is looked upon with disfavor16• After the pre-trial conference, the Pre-Trial Order17 dated September 15, 2011 was issued based on the parties' Joint Stipulation of Facts and Issues18• During the trial, petitioner presented witnesses Jennifer G. Glinoga, Veronica Joy R. Catajoy, and Annalyn B. Artuz. Petitioner's Finance Manager since January 2007, Jennifer G. Glinoga, by way of Judicial Affidavit, 19 testified that she oversees all matters relating to petitioner's tax reporting and regulatory compliance. Petitioner is engaged in the business of licensing and modifying computer hardware, computer system software programs, application, components, devices and supplies, as well as providing support, training and consultancy services in the use and application of said products20 . It is registered with the BIR with Certificate of Registration No. 8RC000001969321 • On December 23, 1999, NSO and UAL executed the CRS-ITP Contract,22 which petitioner assumed on July 1, 2001, via the Assignment and Assumption Agreement23 • Based on the two (²) agreements, petitioner shall be responsible for the design, development, construction, installation, testing and commissioning of NSO's CRS-IT. NSO shall pay petitioner a percentage of the revenues generated by NSO for the use of the Project's technology in rendering services to the public, which includes, authentication, certification, and issuance of Certificate of Live Birth, Certificate of Marriage, Certificate of No- marriage, and other civil registry data. For the four quarters of CY 2009 and the succeeding/

15 Commissioner of Internal Revenue vs. Ledesma, 31 SCRA 95.

16 Western Minolco Corp. vs. Commissioner of Internal Revenue, 124 SCRA 1211.

17 Docket, pp. 155-160.

18 Docket, pp. 131-133.

19 Exhibits "EEE" and "EEE-1".

20 Exhibits "A" to "A-2".

21 Exhibit "B".

22 Exhibit "N".

23 Exhibit "0".

three quarters of CY 2010, petitioner generated a total gross sales of P1,327,843,870.0324, which were subjected to the 5% final VAT of P66,392,193.5025, deducted and withheld by NSO pursuant to Section 114(C) of the NIRC of 1997, as amended.

However, in computing for its output VAT liability, petitioner erroneously credited the actual amount of its input VAT accumulated for the period, instead of the 7% standard input VAT prescribed for payments received from the Government through the NSO, although the actual accumulated input VAT was lower than the 7% standard input VAT on that period.

Consequently, petitioner erroneously paid P76,091,087.98 VAT. Petitioner filed its VAT returns26 with the BIR through the Electronic Filing and Payment System (EFPS) 27 and paid the corresponding VAT of P148,031,890.38, inclusive of the erroneously paid VAT, for the four quarters of CY 2009 and the succeeding three quarters of CY 2010. On February 11, 2011, petitioner filed an administrative claim for refund/TCC28 which remains pending with respondent. Hence, the filing of the instant petition on May 30, 2011.

In her Judicial Affidavit29, witness Veronica Joy R. Catajoy declared that she worked with Isla Lipana & Co., which services as External Tax Consultant was secured by petitioner.

In connection thereto, she handled petitioner's tax concerns under the supervision of Mary Assumption S. Bautista-villareal. She and her team reviewed and amended petitioner's VAT filings for the four quarters of CY 2009 and the succeeding three quarters of CY 2010, and assisted petitioner in the filing of its administrative claim for refund with the BIR.

24 Exhibits "GG-2", "HH-2", "11-2", "JJ-2", "KK-2", "LL-2", "MM-2", "NN-2", "00-2", "PP-2", "QQ-2", "RR-2", "SS-2", "TT-2", "UU-2", "VV-2", "WW-2", "XX-2", "YY-2", "ZZ-2" and "AAA-2".

25 Exhibits "GG", "HH", "II", "JJ", "KK", "LL", "MM", "NN", "00", "PP", "QQ", "RR", "55", "TT", "UU, "W", "WW", "XX", "YY" and ZZ". / 26 Exhibits "F", "F-1", "G", "G-1", "H", "H-1", "I", "1-1", "J", "J-1", "K", "K-1", "L", "L- 1", "5", "S-1", "T", "T-1", "U", "U-1", "V", "V-1", "W", "W-1", "X", "X-1", "Y" and "Y-

1 II'

27 Exhibits "5-1", "T-1", ''U-1", "V-1", "W-1", "X-1" and "Y-1". 28 Exhibits "C" to "C-2 1 ' and "M" to "M-2".

29 Exhibits "HHHH" and "HHHH-1".

Per their review, petitioner has an existing build, operate and transfer (BOT) contract with the NSO for the design, development, construction, installation, testing and commissioning of NSO's CRS-IT for which petitioner receives a percentage of the revenues generated from it. For the four quarters of CY 2009 and the succeeding three quarters of CY 2010, petitioner collected a total of P1,327,843,870.03 for its sale of services to NSO pursuant to the BOT contract, which was subjected to 12% VAT. The total output VAT liabilities incurred by petitioner from its sales to NSO were categorically segregated from its total sales. As a government entity, NSO withheld a 5% final VAT of P66,392,193.48 from its payments to petitioner which represents the net VAT payable by petitioner, while the remaining 7% effectively accounts for the standard input VAT, in lieu of the actual input VAT directly attributable or ratably apportioned to such sales. In computing its VAT liability for the covered period, petitioner erroneously deducted its actual input VAT of P17,846,501.25, instead of the 7% standard input tax as provided under Section 114(C) of the NIRC of 1997, as amended, and as implemented by Section 4.114-2 of Revenue Regulations No. 16-2005, from its total output VAT liabilities of P165,878,391.96. Thus, petitioner erroneously paid a total VAT of P148,031,890.38. In connection with the VAT overpayment, her team revalidated the accuracy and correctness of petitioner's original computations and discovered that petitioner erroneously credited the actual amount of its input VAT accumulated for the period, instead of the 7% standard input VAT which is prescribed for payments received from the government.

Hence, petitioner overpaid its VAT liabilities in the total amount of P76,091,087.98. To arrive at the net VAT payable, the amount of P92,949,070.91, representing petitioner's 7% standard input VAT, was deducted since the majority of petitioner's services were rendered to NSO, hence, the 7% standard input VAT shall be in lieu of petitioner's actual input VAT directly / attributable or ratably apportioned to its total sales for the ~ covered period.

The 7% standard input VAT was higher than the actual input VAT attributable to its sales to NSO for the covered period.

The difference was reported by petitioner as part of its "Non-operating & Taxable Other Income" in its Amended Annual Income Tax Return for CY 2009 and Annual Income Tax Return for CY 201030• The difference in the input VAT used by petitioner and the input tax in the amended VAT Returns pertains to the withholding VAT remitted by petitioner from its royalty payments to Unisys Corporation31, a non-resident corporation.

Petitioner paid VAT in the total amount of P148,031,890.38 for the four quarters of CY 2009 and the succeeding three quarters of CY 2010. On February 11, 2011, petitioner, with their assistance, filed its administrative claim for refund/TCC for its erroneous overpayments.

Independent Certified Public Accountant (ICPA) Annalyn B. Artuz also executed a Judicial Affidavit32 declaring that petitioner's overpayment of VAT was due to its use of actual input VAT as deduction against output VAT in computing for the net VAT payable in its originally filed VAT Returns instead of the 7% standard input VAT. Petitioner's total actual VAT payments consists of actual VAT payments upon filing of the original VAT Returns amounting to P81,639,696.87 and 5% final VAT withheld by NSO amounting to P66,392,193.50 for the four quarters of CY 2009 and the succeeding three quarters of CY 2010. Based on her examination of pertinent documents, petitioner is entitled to its claim for refund pertaining to its erroneous overpayment of VAT in the total amount of P76,091,087.98 for the four quarters of CY 2009 and the / succeeding three quarters of CY 2010. ~

30 Exhibits "E" and "Q".

31 Exhibits "BBB", "CCC" and "DDD".

32 Exhibits "FFFFFFF" and "FFFFFFF-1 ".

The ICPA clarified that petitioner's claim for refund pertains to its VAT payments in excess of the 5% final VAT withheld by NSO for its sales to the government. After petitioner rested33, respondent presented Revenue Officers (ROs) Melinda Lim and Maria Nimfa P. Saga.

RO Melinda G. Lim, stated in her Judicial Affidavit34, that she is currently with the Large Taxpayers Regular Audit Division III of the BIR. She learned about the case through petitioner's request for refund filed on February 11, 2011 pertaining to its alleged VAT overpayment amounting to P40,606,843.59 for CY 2009. On July 1, 2011, Letter of Authority No. LOA-126-2011- 00000016 was issued against petitioner. Thereafter, three notices were sent to it, namely: 1) The First Notice/Initial Data Request with attachmene5 ; 2) the Second Notice 1 Data Request with attachment36; and 3) the Third and Final Notice with attachmene7, which she and her Division Chief Lindagrace B. Sagum signed38 • Despite receipt of all the Notices39, petitioner only partially complied. In her Memorandum dated February 26, 2012 approved by OIC-Assistant Commissioner of the Large Taxpayers Service, Alfredo V. Misajon40 , she recommended the denial of petitioner's entire claim for refund on the following grounds: 1) the claim lacks legal basis; 2) petitioner has no personality to claim refund; and 3) submission of incomplete records.

In a Letter dated February 26, 201241 , petitioner was informed of the denial of its claim42 • RO Lim affirmed that petitioner's claim for refund was due to its erroneous computation of its net VAT payable./

33 Docket, pp. 720-722.

34 Exhibits "13" and "13-A".

35 Exhibit "2".

36 Exhibit "3".

37 Exhibit "4".

38 Exhibits "2-A", "3-A" and "4-A".

39 Exhibits "2-B", "3-B' and "4-B".

40 Exhibits "5-A" and "5-B".

41 Exhibits "6" and "6-A".

42 Exhibit "6-B".

However, VAT refunds are only allowed in three instances, i.e., in relation to zero-rated sales, purchases or dissolution of business.

In her Judicial Affidavit43, RO Nimfa P. Saga, assigned at the BIR's Large Taxpayers Excise Audit Division 2, corroborated the foregoing declaration and added that she denied petitioner's claim for refund because based on her review of the documents submitted, it has no legal basis. Further, petitioner only submitted the Assignment and Assumption Agreement and the Civil Registry and Information Technology Project. Moreover, VAT refund is allowed only in three instances, namely, zero-rated, fixation and dissolution of business and she does not know whether overpayment of tax is one of the basis for refund. After submission of the parties' respective memoranda, the case was submitted for decision on September 24, 2014.44

THE ISSUES

The following issues are for the resolution of the Court: 45 1.

Whether petitioner erroneously computed VAT liability for the four quarters of CY 2009 and the succeeding three quarters of CY 2010; 2.

Whether petitioner overpaid its VAT liabilities for the four quarters of CY 2009 and the first three quarters of CY 2010;

Whether petitioner is entitled to a tax / refund/TCC in the amount of P76,091,087. 98, representing erroneous VAT payments for CY 2009 and for the

43 Exhibits "14" and "14-A".

44 Docket, p. 914.

45 Stipulation of Issues, JSFI, docket, pp. 132-133.

succeeding three quarters of CY 2010; and 4.

Whether petitioner complied with all the evidentiary requirements in its administrative claim for refund/TCC. DISCUSSION/RULING The foregoing issues may be simplified as follows: Whether petitioner is entitled to a refund/TCC in the amount of P76,091,087.98, allegedly representing erroneous VAT payments for CY 2009 and for the succeeding three quarters of CY 2010.

The Court must first determine the timeliness of the filing of the claim.

Under Sections 204(C) and 229 of the NIRC of 1997, as amended, both the administrative claim for refund/TCC filed with the BIR and the subsequent appeal to the CTA must be filed within two years from the date of payment of tax. 46 46 "SEC.204. Authority of the Commissioner to Compromise, Abate and Refund or Credit Taxes. - The Commissioner may - XXX XXX 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 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; / Applying the cited provisions, the prescriptive date for filing both the administrative and the judicial claims shall be as follows:

Date of Last Day to File Exhibit Pavment its Claim

CY 2009

1st Quarter z Aoril 27. 2009 Aoril 27. 2011 2"d0uarter AA July 24. 2009 July 25. 201147 BB October 26, 3rd Quarter 2009 October 26. 2011 cc January 25, 4th Quarter 2010 January 25, 2012

CY 2010

1stouarter DD Aoril 26. 2010 Aoril 26. 2012 2"d0uarter EE July 26. 2010 July 26, 2012 FF October 22, 3rd Quarter 2010 October 22. 2012 The record shows that petitioner filed its Letter Request48 for refund/TCC before the BIR on February 11, 2011 and sought judicial intervention through its Petition for Review with the Court of Tax Appeals on May 30, 2011. Clearly, petitioner seasonably filed its claim for VAT refund in the administrative level. The same is however untrue insofar as its judicial claim for VAT refund for the first quarter of CY 2009 is concerned on the ground that it has already prescribed.

Thus, the Court shall determine petitioner's entitlement to tax refund or issuance of tax credit certificate only for the claims pertaining to the last three quarters of CY 2009 and the succeeding three quarters of CY 2010.

Petitioner's original Quarterly VAT Returns for CY 2009 and the first three quarters of CY 2010 disclosed the following information: 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 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." (Emphasis supplied) 47 July 24, 2011 fell on a Sunday

48 Exhibit "C"", docket, pp. 335-339

CY 2009

1"Qtr"· Vatable Sales/Receipt- Private p 169 207 521.99 Total Sales/Receipts P169 201 521.99 Output Tax Due p 20 304 902.87 Less: Available Input Tax Domestic Purchase of Goods Other than Caoital Goods p 1 149 078.25 Domestic Purchase of SeJVices 1 306 570.14 Total Available Input Tax p 2 455 648.39 Net VAT Payable P17 849 254.48 Less: Tax Credits/Pavments Monthly VAT Payments -previous 2 months p 5 816 824.99 Creditable VAT Withheld 8 041 761.12 Total Tax Credits p 13 858 586.11 Tax Still Payable (OverDavmentl p 3.990.668.37 2"" Qtr"0 3"' Qtr"' p 230 575 686.69 p 176 524 836.42 P230 575 686.69 1'176,524 836.42 p 27 669 081.88 P21 182 980.45 p 1 306 057.79 p 993 689.85 1 751 079.17 1 635 463.20 p 3 057 136.96 p 2 629 153.05 p 24,611 944.92 P18 553 827.40 p 8 212 575.45 p 6 889 418.41 11 101 798.81 8 466 591.90 p 19 314 374.26 p 15 356 010.31 p 5.297.570.66 p 3.197.817.09

CY 2010

1st Qtr"3 2"• Qtr54 Vatable Sales/Receipt- 4'" Qtr"' Total p 169 982 774.60 p 746 290 819.70 1'169 982 774.60 P746,290,819.70 P20 397 929.36 p 89 554 894.56 p 888 850.39 p 4 337 676.28 1 038 833.47 5 731 945.98 p 1 927 683.86 p 10 069 622.26 P18 470 245.50 p 79 485 272.30 p 6 859 269.73 p 27 778 088.58 8 156 538.70 35 766 690.53 p 5 015 808.43 p 63 544 779.11 p 3.454.437.07 p 15.940.493.19 3"' qtr55 Total Private p 187 070 899.88 ,. 245 346 806.60 p 203 611 436.63 ,. 636 029 143.11 Total Sales/Receipts P187,070,899.88 P245,346,806.60 P203,~11,436.63 P636,029,143.11 Output Tax Due p 22,448 507.92 p 29 441 616.64 p 24 433 372.47 p 6 323 497.03 Less: Available Input Tax Domestic Purchase of Goods Other than Capital Goods p 721 159.51 p 2 368 260.18 p 901 333.92 p 3 990 753.61 Domestic Purchase of Services 1 302 859.74 1 071 899.80 1 411 365.84 3 786 125.38 Total Available Input Tax p 2 024,019.25 p 3 440159.98 p 2 312,699.76 p 7,776,878.99 Net VAT Payable p 20 424,488.67 p 26,001,456.66 p 22 120 672.71 p 68 546,618.04 Less: Tax Credits/Pa_yments Monthly VAT Payments- previous 2 months p 6L834 913.55 p 8 591 739.57 p 8 535 937.11 p 23 962 590.23 Creditable VAT Withheld 8 982 999.98 11 841 523.27 9 800 979.69 30,625,502.94 Total Tax Credits p 15 817 913.53 p 20 433,262.84 p 18 336 916.80 p 54 588 093.17 Tax Still Payable (Overpayment) p 4 606,575.14 p 5 568193.82 p 3 783,755.91 p 13,958,524.87 In computing its output VAT liability, petitioner initially utilized its actual input VAT arising from domestic purchases of services and goods other than capital goods, with no /

49 Exhibit "5".

50 Exhibit "T".

51 Exhibit "U".

52 Exhibit "V".

53 Exhibit "W".

54 Exhibit "X".

55 Exhibit "Y".

reported input VAT on services rendered by non-residents. Furthermore, no amount was reported for sales to government and for input tax on sales to government closed to expense (excess of standard input over actual input VAT). Realizing that it erroneously computed its output VAT liability when it failed to recognize and report its sales to government and the corresponding seven percent (7%) standard input VAT, petitioner subsequently filed its Amended Quarterly VAT Returns for CY 2009 and the succeeding three quarters of CY 2010, reflecting a total overpayment of P76,091,087.9956, as presented below:

CY 2009

1"Qtr07 2"' Qt,.S• 3" Qt,.S• Vatable Sales/Receipt- Private p 8 372 299.47 p 8 539 710.51 p 7 192 998.36 Sale to Government 160 835 222.52 222 035 976.18 169 331 838.06 Total Sales P169 207 521.99 P230 S75 686.69 P176 524 836.42 Outout Tax Due Vatable Sales/ Receiot-Private p 1 004 675.94 p 1 024 765.26 p 863 159.80 Sale to Government 19 300 226.70 26 644 317.14 20 319 820.57 Total Outout Tax p 20,304,902.64 p 27 669,082.40 p 21 182,980.37 Less: Available lnout Tax Domestic Purchases of Goods Other than Capital Goods p 1 149 078.25 p 1 306 057.79 p 993 689.85 Domestic Purchase of Services 1 306 570.14 1 751 079.17 1 635 463.20 Services Rendered by Non-residents - - 2 453 885.36 Total Input Tax for the Current oeriod p 2 455 648.39 p 3 057 136.96 p 5,083 038.41 Add: Input Tax on Sale to Gov't closed to expense 8 924 321.38 12 598 606.95 6 977 312.87 Total Available Inout VAT p 11 379 969.77 p 15 655 743.91 p 12 060 351.28 Net VAT Payable p 8 924 932.87 p 12,013 338.49 p 9 122 629.09 Less: Tax Credlts/Pavments Monthly VAT payments-previous 2 months p 5 816 824.99 p 8 212 575.45 p 6 889 418.41 VAT withheld on Sales to Government 8 041 761.13 11 101 798.81 8 466 591.90 VAT paid in return previously filed, if this is an amended return 3 990 668.37 5 297 570.66 3 197 817.09 Total Tax Credits p 17,849,254.49 , 24,611,944.92 p 18,553,827.40 56 P40,606,843.60 (CY 2009) plus P35,484,244.39 (CY 2010) 57 Exhibit "F".

58 Exhibit "G".

59 Exhibit "H".

60 Exhibit"!".

4th Qtr00 Total p 6 851 970.50 p 30 956 978.84 163 130 774.10 715 333 810.86 P169 982 744.60 P746 290 789.70 .

822 236.46 p 3 714 837.46 19 575 692.89 85 840 057.30 p 20 397 929.35 p 89 554,894.76 p 888 850.39 ,.

4 337 676.28 1 038 833.47 5 731 945.98 2 072 506.87 4 526 392.23 p 4 000 190.73 p 14 596 014.49 7 580 210.35 36 080 451.55 p 11 580 401.08 p 50 676 466.04 p 8 817 528.27 p 38 878 428.72 p 6 859 269.73 p 27 778 088.58 8 156 538.71 35 766 690.55 3 454 437.07 15 940 493.19 , 18 470 245.51 ,.

79 485 272.3 !Y

Total Amount Payable COveroavment} PC8 924,321.62} PC 12 598 606.43} PC9 431 198.31}

CY 2010

1'' Otr61 2"" Otr62 Vatable Sales/Receiot-Private p 7 410 900.09 p 8 516 341.05 p Sale to Government 179 659 999.79 236 830 465.55 PC9 652 717.241 PC 40 606 843.601 3"' Otr63 Total 7 591 842.80 p 23 519 083.94 196 019 593.83 612 510 059.17 Total Sales p 187 070 899.88 p 245 346 806.60 p 203 611 436.63 p 636 029 143.11 Output Tax Due Vatable Sales/Receiot-Private p 889 308.01 p 1 021 960.93 p 911 021.14 p 2 822 290.08 Sale to Government 21 559 199.97 28 419 655.87 23 522 351.26 73 501 207.10 Total Outout Tax p 22 448 507.98 p 29 441 616.80 p 24 433 372.40 p 76 323 497.18 Less: Available Input Tax Domestic Purchases of Goods Other than Capital Goods p 721 159.51 p 2 368 260.18 p 901 333.92 p 3 990 753.61 Domestic Purchase of Services 1 302 859.74 1 071 899.80 1 411 365.84 3 786 125.38 Services Rendered by Non- residents - - 2 671 055.90 2 671 055.90 Total Input Tax for the Current period p 2 024 019.25 p 3 440 159.98 p 4 983 755.66 p 10 447 934.89 Add: Input Tax on Sale to Gov't closed to exoense 10 632 363.20 13 257 385.52 8 923 439.90 32 813 188.62 Total Available Input VAT p 12 656 382.45 p 16 697 545.50 p 13 907 195.56 p 43.261.123.51 Net VAT Payable p 9 792 125.53 p 12 744 071.30 p 10 526 176.84 p 33 062 373.67 Less: Tax Credits/Pavments Monthly VAT Payments - previous 2 months p 6 834 913.55 p 8 591 739.57 p 8 535 937.11 p 23 962 590.23 VAT withheld on Sales to Government 8 982 999.99 11 841 523.28 9 BOO 979.69 30 625 502.96 VAT paid in return previously filed, if this is an amended return 4 606 575.14 5 568 193.82 3 783 755.91 13 958 524.87 Total Tax Credits p 20 424 488.68 p 26 001 456.67 I' 22 120 672.71 p 68 546 618.06 Total Amount Payable (Overpayment) P(10,632,363.15} P(13,257,385.37} P( 11,594,495.87} P(35,484,244.39} Petitioner asserts that the VAT overpayment of P76,091,087.98 constitutes erroneously paid tax which can be claimed as tax refund/credit under Section 229 of the NIRC of 1997, as amended, to wit: "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 penalty claimed to have been collected without authority, or of any sum alleged 61 Exhibit "J".

62 Exhibit "K".

63 Exhibit "L".

/ 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 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."

Petitioner further asserts that being an entity predominantly engaged in providing services to government or any of its political subdivisions, instrumentalities or agencies, including government-owned or controlled corporations (GOCCs), the distinct rule in Section 4.114-2 of Revenue Regulations (RR) No.

16-05, as amended, specifically on the rules in computing the VAT payable for the covered period must be taken into account. 64 On these points, respondent counters that petitioner is claiming a refund based on an erroneous perception of the revenue issuances particularly Revenue Memorandum Circular (RMC) No. 62-05 and petitioner failed to follow the procedure indicated in RMC No. 62-05 that it should mandatorily close the input difference between the standard and actual VAT to cost or expense. Hence, it was only correct for petitioner to pay VAT by computing 12% output tax net of actual input tax and credits. 65 Respondent continues to say that based on the law and implementing regulations, the total output tax of 12% is still due from sales to government entities, 5% is output tax / withheld by the government agency and 7% is still output 1v/' 64 Par. 25, petitioner's Memorandum, docket, p. 903 65 Respondent's Memorandum, docket, p. 879 tax but to be treated in a specific manner. For petitioner's failure to follow the procedure, it was correct that it paid the total output tax due as originally filed because in the regular scheme of the VAT computation, the total output tax less input tax (with proper documentation based on actual purchases) is equivalent to output tax due.66 Respondent's arguments are untenable. Section 4.114-2 of RR No. 16-05, as amended by RR No. 04-07, implementing Section 114(C) of the NIRC of 1997, as amended, mandates the withholding of 5% final VAT on government money payments. In addition, Q & A No. 31 of RMC No. 62-05 authorizes the application of the standard input tax of seven percent (7%) of the selling price/gross receipts attributable to government sales. Conversely stated, the allowable input tax for sales of goods and services to the government shall not exceed five percent (5%) of the selling price/gross receipts. If actual input tax exceeds five percent (5%) of gross payments, the excess shall form part of the seller's cost or expense. On the other hand, if actual input VAT is less than five (5%) of gross payments, the difference shall be closed to cost or expense of the seller. The five percent (5%) final VAT withholding rate shall represent the net VAT payable of the seller.

The remaining seven percent (7%) effectively accounts for the standard input VAT for sales of goods or services to government or any of its political subdivisions, instrumentalities or agencies including GOCCs, in lieu of the actual input VAT directly attributable or ratably apportioned to such sales to the Government. Should actual input VAT exceed the standard input VAT of 7% of gross payments, the excess may form part of the sellers' expense or cost. Conversely, if actual input VAT is less than the standard input VAT of 7% of gross payment, the difference must be treated as taxable income. 67 66 Respondent's Memorandum, docket, pp. 880-881. 67 Revenue Memorandum Circular No. 29-05, Q & A No. 17.

Therefore, petitioner's overpayment of VAT which arose from erroneous application of its actual accumulated input VAT for the four quarters of CY 2009 and the succeeding three quarters of CY 2010 instead of the seven percent (7%) standard input VAT shall be refundable as erroneously paid tax pursuant to Section 229 of the NIRC of 1997, as amended, if petitioner can establish that its actual accumulated input VAT attributable to its government sales was lower than the 7% standard input VAT. As stated however, only the VAT overpayment pertaining to the second quarter of 2009 up to the third quarter of 2010 in the total amount of P67,166,766.36 (P76,091,087.98 less P8,924,321.62) may be a proper subject of a refund claim pursuant to Section 229 of the NIRC of 1997, as amended. Based on the record of the case, petitioner derived its gross sales to government from its build, transfer and operate contract (BTO Contract) with the NSO for the design, development, construction, installation, testing and commissioning of NSO's Civil Registry System-Information Technology, which provides that petitioner will receive a percentage of the revenues generated by the NSO from the services rendered under its CRS-IT. For the second quarter of CY 2009 to the third quarter of CY 2010, petitioner generated gross sales in the aggregate amount of P1,213,112,410.82, broken down as follows:

Period Private Sales Sales to Total Government 2009 2nd Quarter p 8 539 710.51 p 222 035 976.18 p 230 575 686.69 3rd Quarter 7 192 998.36 169 331 838.06 176 524 836.42 4th Quarter 6 851 970.50 163 130 774.10 169,982 744.60 2010 1st Quarter 7 410 900.09 179 659 999.79 187,070,899.88 2nd Quarter 8,516,341.05 236,830 465.55 245,346,806.60 3rd Quarter 7,591,842.80 196 019 593.83 203 611 436.63 Total P46 103 763.31 P1 167 008,647.51 P1,213, 112,410.82 To substantiate its sales to government in the amount of P1,167,008,647.51, petitioner presented the official / receipts it issued to the NSO. The said revenues were duly reported in petitioner's Amended VAT Returns and were subjected to the corresponding 12% VAT and to 5% final VAT, which it withheld pursuant to Section 114(C) of the NIRC of 1997, as amended. 68 Moreover, to be entitled to refund/TCC, petitioner must prove that it incurred and had enough input tax credits and VAT payments.

An examination of the record shows that petitioner's VAT payments consisted of the following: Actual VAT 5%VAT payments upon withheld by Total VAT Period filing of NSO supported Payments original VAT by BIR Form returns69 No. 230770 2009 2nd Quarter April p 4,133,377.31 p 3,477,715.67 p 7,611,092.98 Mav 4 079,198.14 3,358,851.16 7,438,049.30 June 5,297,570.66 4,265,231.98 9,562,802.64 3rd Quarter 68 "SEC. 114. Return and Payment of Value-added Tax. - XXX XXX XXX (C) Withholding of Creditable Value-added Tax.

-The Government or any of its political subdivisions, instrumentalities or agencies, including government-owned or controlled-corporations (GOCCs) shall, before making payment on account of each purchase of goods from sellers and services rendered by contractors which are subject to the value-added tax imposed in Sections 106 and 108 of this Code, deduct and withhold the value-added tax due at the rate of five percent (5%) of the gross payment thereof: Provided, That the payment for lease or use of properties or property rights to non- resident owners shall be subject to ten percent (10%) withholding tax at the time of payment. For purposes of this Section, the payor or person in control of the payment shall be considered as the withholding agent."

69 Exhibits "JJJ-2" "LLL-2" "AA" "NNN-2" "PPP-2" "BB" "RRR-2" "TTT-2" "CC" 1 I I f I I I I I "VW-2", "XXX-2", "DD", "ZZZ-2", "BBBB-2", "EE", "DDDD-2", "FFFF-2", and "FF", docket, pp. 597, 607, 507, 617, 627, 508, 637, 647, 509, 657, 667, 510, 675, 681, 511, 687, 693, and 512, respectively. / 70 Exhibits "II" "JJ" "KK" "LL" "MM" "NN" ''00" "PP" "QQ" "RR" "SS" "TT" I I I I I I I I I I I I "UU", "VV", "WW", "XX", "YY", and "ZZ", docket, pp. 517, 519, 521, 523, 525, 527, 529, 531, 533, 535, 537, 539, 541, 543, 545, 547, 549, and 551, respectively.

July 3,925,140.40 August 2,964,278.01 September 3,197,817.09 4th Quarter October 3 480 657.46 November 3,378,612.26 December 3A54A37.07 2010 1st Quarter January 2,567,289.81 3,121,927.37 7,047,067.77 2,870,308.92 5,834,586.93 2,474,355.61 5,672,172.70 2 721 988.37 6 202 645.83 2,833A52.59 6,212,064.85 2 601 097.75 6,055,534.82 2 086 271.92 4,653,561. 73 February 4,267,623.74 3A06J87.97 7,674A11.71' March 4,606,575.14 3 489 940.09 8,096,515.23 !

2nd .

Quarter April 4,544,027.78 3 895,019.19 8A39,046.97 May 4,047,711. 79 3,740,266.91 7,787,978. 70 • June 5,568,193.82 4,206,237.17 9J74A30.99 3rd Quarter July 4A30,051.66 3,704,193.04 8,134,244.70 August 4,105,885.45 3,174,665.97 7,280,551.42 September 3J83J55.91 2,922,120.68 6,705,876.59 Total P71,832,203.50 P58,350,432.36 P130,182,635.86 However, of the P58,350,432.36 total VAT withheld by the NSO, the amount of P3,895,019.19 pertaining to the month of April 201071 shall be disallowed as tax credit since its supporting Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) lacks the signature of the authorized signatory;

thus, shall bear no weight.

Consequently, only the amount of P54,455,413.17 (P58,350,432.36 less P3,895,019.19) is considered as VAT withheld by NSO, which may be credited against its output liability.

On the other hand, petitioner reported input VAT from the second quarter of CY 2009 to the third quarter of CY 2010 in the total amount of P22,588,300.99, summarized per quarter as follows: PERIOD AMOUNT 2009 2nd Quarter p 3,057,136.96 3rd Quarter 5,083,038.41 4th Quarter 4.000,190.73 71 Exhibit "UU".

2010 1st Quarter 2nd Quarter 3rd Quarter Total 2,024,019.25 3,440,159.98 4,983,755.66 P22,588,300. 99 To substantiate the foregoing figures, petitioner submitted various suppliers' invoices and official receipts72 and its Monthly Remittance Returns of Value-added Tax and Other Percentage Taxes Withheld (BIR Form No. 1600)73 • Upon scrutiny of the said documents, the Court finds that the input VAT amount of P12,083,947.19, as summarized below, should be disallowed for petitioner's failure to meet the substantiation requirements under Sections 110(A) and 113(A) and (B) of the NIRC of 1997, as amended by RA No. 9337, as implemented by Sections 4.110-2, 4.110-8, and 4.113-1 of RR No. 16-05: FINDINGS

1. Input VAT on purchases of goods/services supported by VAT invoices/ORs wherein the input VAT amount per invoice/OR is lower than the amount per claim (over-claimed input VAT)

2. Input VAT on domestic purchases of goods/services supported by VAT invoices/ORs wherein the input VAT amounts were not separately shown

3. Input VAT on domestic purchases of goods/services supported by VAT invoices/ORs issued not in petitioner's name

4. Input VAT on domestic purchases of goods/services supported by VAT invoices/ORs dated outside the period of claim or were not dated

5. Input VAT on domestic purchases of goods/services supported by invoices/ORs with supplier's TIN but without the word "VAT"

6. Input VAT on domestic purchases of goods supported by documents other than VAT invoices 72 Exhibits "MMMMM" to "SSSSS". 73 Exhibits "BBB" to "DDD". ANNEX AMOUNT A p 5,922.86 B 6,154,663.67 c 157,629.07 D 383,663.24 E 393,472.00 F 3,698,869. 72 j

7. Input VAT on domestic purchases of services supported by documents other than VAT DRs

8. Input VAT on domestic purchases of services supported by documents other than VAT DRs and issued not in petitioner's name

9. Input VAT on domestic purchases of goods/services supported by documents other than VAT invoices/DRs with printed notation "not a valid source of input tax" 10.

Input VAT on domestic pyrchases of goods and services supported by photocopy of VAT invoices/DRs 11.

Unaccounted/unsupported input VAT claim TOTAL G 193,149.52 H 24,164.00 I 924,914.94 J 15,982.98 K 121,515.19 P12,083,947.19 Consequently, only the remaining input VAT of P10,504,353.80 (P22,588,300.99 less P12,083,947.19) represents petitioner's valid input VAT for the second quarter of CY 2009 to the third quarter of CY 2010, which may be credited against petitioner's output VAT for the same period.

In fine, petitioner was able to substantiate erroneous VAT payments of P51,187,799.96 only, as computed below: Output VAT per Returns Sales to Private *CY 2009 (P3,714,837.46-P1,004,675.94) P2,710,161.52

CY 2010

2,822,290.08 p 5,532,451.60 Sales to Government *CY 2009 (P85,840,057.30-P19,300,226.70) 66,539,830.60

CY 2010

73,501,207.10 140,041,037.70 Total Output VAT P145,573,489.30 Less: Input VAT Valid Input VAT 10,504,353.80 Input Tax on Sale to Government closed to expense *CY 2009 (P36,080,451.55- P8,924,321.38) P27,156,130.17

CY 2010

32,813,188.62 59,969,318.79 70,473,672.59 Net VAT Payable p 75,099,816.71 Less: VAT Payments Actual Payments 71 832,203.50 VAT Withheld on Sales to Government 54,455,413.17 126,287,616.67 /

I VAT Overpayment I P(51,187,799.96) I Moreover, based on its Quarterly VAT Returns from the fourth quarter of CY 2010 to the second quarter of CY 201274, petitioner did not carry over the input VAT of P76,091,087.98, which is the subject matter of the present claim. The said amount was neither presented as "Input tax carried over from previous period" nor claimed or utilized as deduction from output VAT in the subsequently filed returns for the fourth quarter of CY 2010 to the second quarter of CY 2012.

WHEREFORE, the instant Petition for Review is hereby PARTIALLY GRANTED. Accordingly, respondent is hereby ORDERED TO REFUND or TO ISSUE A TAX CREDIT CERTIFICATE in favor of petitioner in the reduced amount of P51,187,799.96, representing petitioner's erroneous payments of VAT for the second to fourth quarters of CY 2009 and the succeeding three quarters of CY 2010.

SO ORDERED.

We Concur:

LOVEaAUTISTA As~ociate Justice ESPEKA.NA' <Pul. ~A L_· MA. BELEN M. RINGPIS-LIBAN Associate Justice

74 Exhibits "TTTTT" to "YYYYY" and "BBBBBBB".

ATTESTATION I attest 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. LOVEL~ R. BAUTISTA Associate Justice Chairperson CERTIFICATION Pursuant to Section 13 of Article VIII of the Constitution, and the Division's Chairperson's Attestation, 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. ~~~ Presiding Justice

UNISYS PUBLIC SECTOR SERVICES CORPORATION

Annex A Input VAT on Purchases of goods/seiVices supported by VAT invoices/ORs wherein the input VAT amount per invoice/OR is lower than the amount per claim ( overclilim) Name of Supplier Exhibit OR amount Amount claimed Overclaim INNOVE COMMUNICATIONS INC. NNNNN-12 25 612.51 26 809.36 1196.85 IN NOVE COMMUNICATIONS INC. NNNNN-13 1 719.64 1800.00 80.36 IN NOVE COMMUNICATIONS INC. NNNNN-19 3 625.50 3 794.92 169.42 IN NOVE COMMUNICATIONS INC. NNNNN-20 35 166.89 36 810.20 1 643.31 INNOVE COMMUNICATIONS INC. NNNNN-21 1 719.64 1 800.00 80.36 BAY AN TELECOMMUNICATIONS INC. NNNNN-24 8 368.93 8,760.00 391.07 BAY AN TELECOMMUNICATIONS INC. NNNNN-25 532.84 557.74 24.90 BAY AN TELECOMMUNICATIONS INC. NNNNN-26 573.21 600.00 26.79 INNOVE COMMUNICATIONS INC. NNNNN-122 5 380.00 5 631.40 251.40 INNOVE COMMUNICATIONS INC. NNNNN-123 32 994.68 34 536.49 1 541.81 INNOVE COMMUNICATIONS INC. NNNNN-124 1 719.64 1 800.00 80.36 BAY AN TELECOMMUNICATIONS, INC. 00000-13 8 368.92 8 760.00 391.08 BAY AN TELECOMMUNICATIONS, INC. 00000-14 573.21 600.00 26.79 BAY AN TELECOMMUNICATIONS INC. 00000-15 573.21 600.00 26.79 BAY AN TELECOMMUNICATIONS, INC. 00000-19 8 368.93 8 760.00 391.07 BAY AN TELECOMMUNICATIONS, INC. 00000-20 573.21 600.00 26.79 BAY AN TELECOMMUNICATIONS, INC. 00000-21 573.21 600.00 26.79 ABOmz ONE INC.

00000-104 7 911.18 8 032.76 121.58 ABOmz ONE INC.

PPPPP-11 20 256.54 20 561.45 304.91 ABOmz ONE INC.

PPPPP-12 399.42 405.49 6.07 ABOmZ ONE INC.

PPPPP-13 2S 076.64 25 449.78 373.14 BAY AN TELECOMMUNICATIONS, INC. PPPPP-14 8,368.93 8,760.00 391.07 BAY AN TELECOMMUNICATIONS, INC. PPPPP-15 573.21 600.00 26.79 BAY AN TELECOMMUNICATIONS, INC. PPPPP-16 573.21 600.00 26.79 BAY AN TELECOMMUNICATIONS, INC. PPPPP-21 573.21 600.00 26.79 ABOmz ONE INC.

NNNNN-117 9 360.00

CONSNET BUILDERS INC

NNNNN-120 3 702.00 HOBBIES OF ASIA INC.

NNNNN-121 9 360.00

M2 KLEEN CARPET CLEANING

NNNNN-125 375.00

M2 KLEEN CARPET CLEANING

NNNNN-126 535.71

SUPERCLEAN SERVICES CORPORATION

NNNNN-127 16 472.66 SYSTEMS GENERATORS PHILIPPINES INC. NNNNN-128 21,733.32 FIRST 3K GROUP BUILDERS CORP. NNNNN-133 28 800.00 FIRST 3K GROUP BUILDERS CORP. NNNNN-143 9 674.40

M2 KLEEN CARPET CLEANING

00000-10 375.00 ABOmZ ONE, INC.

00000-12 27 689.88

M2 KLEEN CARPET CLEANING

00000-16 1,046.25

RICOH PHILIPPINES INC

00000-41 570.21 AIRFREIGHT 2100, INC. 00000-54 61 760.57 BAY AN TELECOMMUNICATIONS, INC. 00000-55 8 760.00 BAY AN TELECOMMUNICATIONS, INC. 00000-56 600.00 BAY AN TELECOMMUNICATIONS, INC. 00000-57 600.00

UNISYS PUBLIC SECTOR SERVICES CORPORATION

00000-99 3 256.03

M2 KLEEN CARPET CLEANING

00000-100 375.00 SYSTEMS GENERATORS PHILIPPINES INC. 00000-101 21,521.43 SYSTEMS GENERATORS PHILIPPINES, INC. 00000-102 21,714.13 ABOmz ONE, INC.

00000-103 18 594.30 HOBBIES OF ASIA. INC. 00000-107 9 360.00

M2 KLEEN CARPET CLEANING

00000-108 321.43 MICROIMAGING SALES AND SERVICES, INC. 00000-109 72 860.41

MY SECURE SIGN INC

00000-110 1464.12 SYSTEMS GENERATORS PHILIPPINES, INC. 00000-111 21,414.95

ULTIMATE SECURITY AGENCY AND ALLIED SERVICES

00000-112 84,385.70

W ELLCOME PRINTING SERVICES

00000-113 33 750.64

MICROIMAGING SALES AND SERVICES

00000-139 72 860.41

M2 KLEEN CARPET CLEANING

W ELLCOME PRINTING SERVICE

PPPPP-96 19 189.29

W ELLCOME PRINTING SERVICE

MANILA ELECTRIC COMPANY

-26 1 700.63 MANILA ELECfRIC COMPANY -42 5,234.S6 MANILA ELECfRIC COMPANY Ul -43 6 069.06 ISLA LIPANA AND CO.

-113 9,579.00 MANILA ELECfRIC COMPANY RRRRR-65 7 007.21

AMBASSADOR APPLIANCES INC

SSSSS-60 1,182.86 Total ' 157,~29.07

Annex C

UNISYS PUBLIC SECTOR SERVICES CORPORATION

Annex D Input VAT on Domestic purchases of goods/services supported by VAT invoices/ORs dated outside the period of claim or are not dated Name of Supplier Exhibit Amount

WELLCOME PRINTING SERVICES

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION NNNNN-31 104,464.29

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION NNNNN-32 111,680.36

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION NNNNN-49 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION NNNNN-50 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION NNNNN-51 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

SERVICES INC

NNNNN-65 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

SERVICES INC

NNNNN-66 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION 00000-31 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION 00000-38 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

SERVICES INC

00000-52 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION 00000-114 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION 00000-136 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION PPPPP-36 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION PPPPP-37 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION PPPPP-52 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION PPPPP-53 112,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION PPPPP-63 112,500.00

MISNET EDUCATION INC

PPPPP-64 7,425.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION -46 202,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

SERVICES -59 22,500.00

SKYFRESH INTERNATIONAL CORPORATION

-138 384.00

AMBASSADOR APPLIANCES INC

RRRRR-41 2,619.64

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION RRRRR-46 742,500.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION RRRRR-47 225,000.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION RRRRR-57 249,750.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION RRRRR-66 341,100.00

M2 KLEEN CARPET CLEANING

SSSSS-97 1,446.43 Total 3,698,869.72

UNISYS PUBLIC SECTOR SERVICES CORPORATION

Annex G Input VAT on Domestic purchases of services supported by documents other than VAT ORs Name of Supplier Exhibit Amount I I

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

NNNNN-149 4.414.611

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

NNNNN-150 2 433.811

E M ZALAMEA ACTUARIAL SERVICES

NNNNN-148 1404.001

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

NNNNN-154 2 005.32i

PHILIPPINE LONG

00000-141 2 005.32i INNOVE COMMUNICATIONS INC. 00000-142 1800.00

-147 1 008.00

PHIUPPINE LONG DISTANCE

RRRRR-123 5 658.93

PHILIPPINE LONG DISTANCE

55555-137 4 581.42 Total 24,164.00

Annex H

UNISYS PUBUC SECTOR SERVICES CORPORATION

Input VAT on Domestic purchases of goods/services supported by documents other than VAT invoices/ORs with printed notation "not a valid source of input tax" Name of Supplier Exhibit Amount

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-115 4 302.29

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-119 4 338.96

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-122 1 329.84

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-124 1 501.20

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-125 4 302.29

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-126 4 338.96

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-127 4 452.92

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-128 2 005.321

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-129 1 096.44,

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-130 1 791.24

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-131 5 169.50

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-132 1 096.44

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-133 1 791.24

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-134 4 302.29

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-135 1 501.20

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-143 1 329.84

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-94 4 302.29

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-99 4 302.29

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-118 1 791.24

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-119 2 016.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-120 3 543.93

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-121 2 715.42

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-122 1 501.20

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-123 4 669.94

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-124 2 005.32

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-125 1 096.44

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-126 1 791.24

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-129 5 203.34

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-130 2 005.32

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-131 1 096.44

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-132 1,329.84

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-133 2 270.81

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-134 1 008.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-136 1,008.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-137 1 501.20

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

PPPPP-141 3 825.09

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

-114 17 355.84

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

l..ll..ll..ll..ll..l-115 8,604.58

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

-116 4 338.96

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

-117 13 990.82

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

-118 6,015.96

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

~ -119 1 872.69

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

-120 5 373.72

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

ooooo-121 4 032.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

l..ll..ll..ll..ll..,!-122 2,016.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

-123 2 016.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

-124 1 008.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

QQQQQ-125 3 024.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

QQQQQ-126 2,016.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

-127 960.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

nooo0-128 8 604.58

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

-129 4 338.96

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

l..ll..ll..ll..ll..,!-130 4 802.09

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

-131 1 791.24

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

oooor -132 6 048.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

I.JI..ll..ll..ll..l-133 1 008.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

-134 1 008.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

00000-135 1,008.00

Annex!

UNISYS PUBUC SECTOR SERVICES CORPORATION

Input VAT on Domestic purchases of goods/services supported by documents other than VAT invoices/ORs with printed notation "not a valid source of input tax" Name of Supplier Exhibit Amount

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

-136 480.00

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-113 4 302.29

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-114 4 338.96

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-115 4,960.94

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-116 1 008.00

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-117 1008.00

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-118 1,008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-119 1 008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-120 1 008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-121 480.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-122 4 338.96 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-124 2 016.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-125 1 008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-126 1,008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-127 1 008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-128 1008.00

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-129 480.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-130 2 105.11

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-131 1008.00

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-132 4 338.96

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-134 1,008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-135 2 016.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-136 1 008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-137 1.008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-138 1 008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-139 1 008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY RRRRR-140 480.00

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-141 1 008.00 FIRST 3K GROUP BUILDERS CORP. RRRRR-143 4 521.44

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-144 1 791.24

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-146 1,008.00

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

RRRRR-148 2 016.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION SSSSS-39 129,150.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION SSSSS-40 92,250.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION SSSSS-52 226 800.00

MERCURY INTERNATIONAL SECURITY PRINTING

CORPORATION SSSSS-61 183,150.00

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

SSSSS-125 4,338.96

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

SSSSS-126 3 958.95

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

SSSSS-127 1 008.00

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

SSSSS-128 2,016.00

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

SSSSS-129 1 008.00

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

SSSSS-130 1008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY SSSSS-131 1008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY SSSSS-132 1008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY SSSSS-133 480.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY SSSSS-134 1008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY SSSSS-136 4,338.96 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY SSSSS-138 1008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY SSSSS-139 1 817.16 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY SSSSS-140 1 008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY SSSSS-141 1 008.00 PHiliPPINE LONG DISTANCE TELEPHONE COMPANY SSSSS-142 1 008.00

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

SSSSS-143 1 008.00

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

SSSSS-144 4,338.96

Annex I

UNISYS PUBLIC SECTOR SERVICES CORPORATION

Input VAT on Domestic purchases of goods/services supported by documents other than VAT invoices/ORs with printed notation "not a valid source of input tax" Name of Supplier Exhibit Amount

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

55555-145 4 999.29

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

55555-146 1 008.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

55555-147 1 008.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

55555-148 1008.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

55555-149 1,008.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

55555-150 480.00

PHIUPPINE LONG DISTANCE TELEPHONE COMPANY

55555-151 1.008.00 Total 924,914.94

Annex I

UNISYS PUBLIC SECTOR SERVICES CORPORATION

Input VAT on Domestic purchases of goods and services supported by photocopy of VAT invoices/ORs Name of Supplier Exhibit Amount

E M ZALAMEA ACTUARIAL SERVICES

-144 1404.00

ISLA LIPANA AND CO

-145 14 098.98

PHILIPPINE LONG DISTANCE

SSSSS-157 480.00 Total 15,982.98

Annex J

UNISYS PUBUC SECTOR SERVICES CORPORATION

Unaccounted/unsupported input VAT claim Particulars Exhibit/Reference Exhibit not found in the records of the case PPPPP-66 Supporting documents not available for verification No supporting documents for purchase from Mercury International Sec with invoice no. 11043 Total Page 1 of 1 Annex K Amount of Input VAT 1 328.57 7,686.62 112,500.00 121515.19

Footnotes

1
Exhibits " A" to "A-2".
2
Exhibit "B".