Source: http://lawlibrary.chanrobles.com/index.php?option=com_content&view=article&id=83069:57051&catid=1584&Itemid=566
Timestamp: 2019-04-25 02:25:54+00:00

Document:
G.R. No. 197591, June 18, 2014 - TAGANITO MINING CORPORATION, Petitioner, v. COMMISSIONER OF INTERNAL REVENUE, Respondent.
TAGANITO MINING CORPORATION, Petitioner, v. COMMISSIONER OF INTERNAL REVENUE, Respondent.
Before the Court is a petition for review on certiorari1 assailing the Decision2 dated January 11, 2011 and the Resolution3 dated June 27, 2011 of the Court of Tax Appeals (CTA) En Banc in CTA EB No. 609 which reversed and set aside the Decision4 dated November 24, 2009 and the Resolution5 dated March 12, 2010 of the CTA First Division (CTA Division) in C.T.A. Case No. 7428, and ordered the dismissal of petitioner Taganito Mining Corporation’s (Taganito) claim for refund of excess input value-added tax (VAT) for having been prematurely filed.
The CIR filed a motion for reconsideration praying for the reversal of the partial refund granted in Taganito’s favor, which was, however, denied in a Resolution14 dated March 12, 2010.
(A) Zero-rated or Effectively Zero-rated Sales. – any VAT-registered person, whose sales are zero-rated or effectively zero-rated may, within two (2) years after the close of the taxable quarter when the sales were made, apply for the issuance of a tax credit certificate or refund of creditable input tax due or paid attributable to such sales, except transitional input tax, to the extent that such input tax has not been applied against output tax: x x x.
(D) Period within which Refund or Tax Credit of Input Taxes shall be Made. – In proper cases, the Commissioner shall grant a refund or issue the tax credit certificate for creditable input taxes within one hundred twenty (120) days from the date of submission of complete documents in support of the application filed in accordance with Subsections (A) and (B) hereof.
As correctly pointed out by the CTA En Banc, the Court, in the 2010 Aichi case, ruled that the observance of the 120-day period is a mandatory and jurisdictional requisite to the filing of a judicial claim for refund before the CTA. Consequently, non-observance thereof would lead to the dismissal of the judicial claim due to the CTA’s lack of jurisdiction. The Court, in the same case, also clarified that the two (2)-year prescriptive period applies only to administrative claims and not to judicial claims. In other words, the Aichi case instructs that once the administrative claim is filed within the prescriptive period, the claimant must wait for the 120-day period to end and, thereafter, he is given a 30-day period to file his judicial claim before the CTA, even if said 120-day and 30-day periods would exceed the aforementioned two (2)-year prescriptive period.
Sec. 4. Power of the Commissioner To Interpret Tax Laws and To Decide Tax Cases. – The power to interpret the provisions of this Code and other tax laws shall be under the exclusive and original jurisdiction of the Commissioner, subject to review by the Secretary of Finance.
Reconciling the pronouncements in the Aichi and San Roque cases, the rule must therefore be that during the period December 10, 2003 (when BIR Ruling No. DA-489-03 was issued) to October 6, 2010 (when the Aichi case was promulgated), taxpayers-claimants need not observe the 120-day period before it could file a judicial claim for refund of excess input VAT before the CTA. Before and after the aforementioned period (i.e., December 10, 2003 to October 6, 2010), the observance of the 120-day period is mandatory and jurisdictional to the filing of such claim.
In this case, records disclose that Taganito filed its administrative and judicial claims for refund on December 28, 2005 and March 31, 2006, respectively – or during the period when BIR Ruling No. DA-489-03 was in place. As such, it need not have waited for the expiration of the 120-day period before filing its judicial claim for refund before the CTA. In view of the foregoing, the CTA En Banc, thus, erred in dismissing Taganito’s claim on the ground of prematurity.
WHEREFORE the petition is PARTIALLY GRANTED. The Decision dated January 11, 2011 and the Resolution dated June 27, 2011 of the Court of Tax Appeals En Banc in CTA EB No. 609 are hereby REVERSED and SET ASIDE. Accordingly, the Decision dated November 24, 2009 of the Court of Tax Appeals First Division in C.T.A. Case No. 7428 ordering the refund to petitioner Taganito Mining Corporation of its unutilized input VAT for the period January 1, 2004 to March 9, 2004, in the amount of P537,645.43, is REINSTATED.
Brion, (Acting Chairperson),* Del Castillo, Perez, and Mendoza,** JJ., concur.
* Designated Acting Chairperson per Special Order No. 1699 dated June 13, 2014.
** Designated Acting Member per Special Order No. 1696 dated June 13, 2014.
2 Id. at 64-78. Penned by Associate Justice Erlinda P. Uy, with Presiding Justice Ernesto D. Acosta and Associate Justices Juanito C. Castañeda, Jr., Caesar A. Casanova, Olga Palanca-Enriquez, Esperanza R. Fabon-Victorino, Cielito N. Mindaro-Grulla, and Amelia R. Cotangco-Manalastas, concurring; and Associate Justice Lovell R. Bautista, dissenting.
4 Id. at 98-110. Penned by Associate Justice Lovell R. Bautista, with Presiding Justice Ernesto D. Acosta and Associate Justice Caesar A. Casanova, concurring.
5 Id. at 112-117. Penned by Associate Justice Lovell R. Bautista, with Presiding Justice Ernesto D. Acosta, concurring and dissenting, and Associate Justice Caesar A. Casanova, concurring.
8 Rollo, pp. 66-67. See also id. at 99-100.
11 See id. at 105-110.
17 See rollo, pp. 72-77.
22 See Republic v. GST Philippines, Inc., G.R. No. 190872, October 17, 2013.
23 G.R. Nos. 187485, 196113, and 197156, February 12, 2013, 690 SCRA 336.
25CIR v. San Roque Power Corporation, supra note 23, at 401-402.
26 Communities Cagayan, Inc. v. Nanol, G.R. No. 176791, November 14, 2012, 685 SCRA 453, 463; see Yano v. Sanchez, G.R. No. 186640, February 11, 2010, 612 SCRA 347, 358; and see also Loy, Jr. v. San Miguel Corporation Employees Union-Philippine Transport and General Workers Organization (SMCEU-PTGWO), G.R. No. 164886, November 24, 2009, 605 SCRA 212, 230.

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