2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina Lumbera

JURISTS BAR REVIEW CENTER™ SUMMARY OF IMPORTANT CASE DOCTRINES (2014, 2015, Jan – August 2016) TAXATION LAW (2016 BAR EXAMS) ATTY. RIZALINA V. LUMBERA

I. 2016 CASES (JAN TO AUG) CIR vs Goodyear Philippines August 3, 2016 GR 216130 Requirements for refund under Section 229 of the NIRC: a. administrative claim with BIr should be filed within 2 years from date of payment of tax; It does not mean that the taxpayer must await the final resolution of its administrative claim for refund, since doing so would be tantamount to the taxpayer's forfeiture of its right to seek judicial recourse should the two (2)-year prescriptive period expire without the appropriate judicial claim being filed before the CTA; b. judicial claim must be filed before CTA Division within the same 2 year period; Filing by Goodyear of administrative refund and judicial claims 13 days apart both within the 2 year period, is upheld as correct and timely sought judicial redress in compliance with the above requirements;

CIR vs Kepco Corporation GR 199422 21 June 2016 Does the CTA EB has jurisdiction over petitions for annulment of judgment rendered by CTA DIV? Revised Rules of the CTA and Rules of Court are silent on this. The silence of the Rules may be attributed to the need to preserve the principles that there can be no hierarchy within a collegial court between its divisions and the en banc, and that a court’s judgment, once final, is immutable. A direct petition for annulment of a judgment of the CTA to the Supreme Court, meanwhile, is likewise unavailing, for the same reason that there is no identical remedy with the High Court to annul a final and executory judgment of the Court of Appeals. The remedy is to file a petition for certiorari under Rule 65 which can be filed before the Supreme Court and not before the CTA EB; CTA En Banc has no jurisdiction over original petitions for annulment of judgment/decision rendered by CTA Division.

VIP CASES re SURETY BOND TO SUSPEND BIR COLLECTION CASE Tridmaha Marketing Corporation vs CTA et al; GR 215950 20 June 2016 SPOUSES EMMANUEL D. PACQUIAO AND JINKEE J. PACQUIAO vs. THE COURT OF TAX APPEALS - FIRST DIVISION AND CIR G.R. No. 213394, April 06, 2016

CTA has power to fix the surety bond posted by the TX as a condition precedent to to suspend the collection case filed by BIR. Fixing the bond five times more than the networth of TX without conducting a preliminary hearing to ascertain whether there were grounds to suspend the collection of the deficiency assessment is not proper. CTA Division must consider other factors like whether or not the assessment would jeopardize the interest of the 2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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taxpayer, or whether the means adopted by the CIR in determining the liability of the taxpayer was legal and valid. In the earlier case of Manny Pacquiao, Supreme Court deems it best to remand the matter involving the petitioner's plea against the correctness of the deficiency assessment to the CTA for the conduct of a preliminary hearing in order to determine whether the required surety bond should be dispensed with or reduced. Absent any evidence and preliminary determination by the CTA, the Court cannot make any factual finding and settle the issue of whether the petitioners should comply with the security requirement under Section 11, R.A. No. 1125. The determination of whether the methods, employed by the CIR in its assessment, jeopardized the interests of a taxpayer for being patently in violation of the law is a question of fact that calls for the reception of evidence which would serve as basis. In this regard, the CTA is in a better position to initiate this given its time and resources. The remand of the case to the CTA on this question is, therefore, more sensible and proper.

Capitol Wireless Inc vs Provincial Treasuere of Batangas GR 180110 30 May 2016 Submarine or undersea communications cables are akin to electric transmission lines which are "no longer exempted from real property tax" and may qualify as "machinery" subject to real property tax under the Local Government Code. Both electric lines and communications cables, in the strictest sense, are not directly adhered to the soil but pass through posts, relays or landing stations, but both may be classified under the term "machinery" as real property under Article 415(5) of the Civil Code for the simple reason that such pieces of equipment serve the owner's business or tend to meet the needs of his industry or works that are on real estate. A boathouse which, by its nature, is a vessel and, therefore, a personal property but, if it is tied to the shore and used as a residence, and since it floats on waters which is immovable, is considered real property. Taxability of the cable wires is based on the extent of Capwire's ownership or co-ownership and the length that is laid within LGU’s taxing jurisdiction. The matter, however, requires a factual determination that is best performed by the Local and Central Boards of Assessment Appeals, a remedy which the petitioner did not avail of.

CIR vs Liquigaz Philippines GR 215534/215557 18 April 2016 Applied in this case is RR 12-99. When may a Final Decision on Disputed Assessment (FDDA) be declared void, and in the event that the FDDA is found void, what would be its effect on the tax assessment? An assessment is void if the taxpayer is not notified in writing of the facts and law on which it is made. The requirement of informing the taxpayer of the legal and factual bases of the assessment and the decision made against him applies both to the FLD/FAN and the FDDA. The invalidity of FDDA does not necessarily result to the invalidity of the FAN/PAN other—unless the law or regulations otherwise provide. A "decision" differs from an "assessment" and failure of the FDDA to state the facts and law on which it is based renders the decision void-but not necessarily the assessment. Tax laws may not be extended by implication beyond the clear import of their language, nor their 2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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operation enlarged so as to embrace matters not specifically provided.

Silicon Philippines Inc. vs CIR GR 182737 02 March 2016 Under Section 112 of NIRC, the judicial claim for refund shall be filed within a period of 30 days after the receipt of respondent's decision or ruling or after the expiration of the 120-day period, whichever is sooner. Aside from a specific exception to the mandatory and jurisdictional nature of the periods provided by the law, any claim filed in a period less than or beyond the 120+30 days provided by the NIRC is outside the jurisdiction of the CTA

CIR vs GJM Philippines Manufacturing Inc. GR 202695 29 Feb 2016 The prescriptive period for issuance of FAN is 3 years from due date if return is filed on or before due date and if filed beond due date, 3 years from date of actual filing. When an assessment is made within the prescriptive period, receipt by the taxpayer may or may not be within said period. It is a requirement that the taxpayer should actually receive the assessment notice, even if beyond the prescriptive period. If the taxpayer denies receipt of FAN, onus probandi has shifts to the BIR to show by contrary evidence that TX indeed received the assessment in the due course of mail. It has been settled that while a mailed letter is deemed received by the addressee in the course of mail, this is merely a disputable presumption subject to controversion, the direct denial of which shifts the burden to the sender to prove that the mailed letter was, in fact, received by the addressee.

CIR vs Mirant Pagbilao Corporation GR 180434 20 January 2016 Applied Section 112 NIRC: TX filed petition for review with the CTA 15 days after filing its claim for refund without waiting for the lapse of the 120-day period expressly provided for by law within which the CIR shall grant or deny the application for refund. Failure to comply with the 120-day waiting period violates a mandatory provision of law. It violates the doctrine of exhaustion of administrative remedies and renders the petition premature and thus without a cause of action, with the effect that the CTA does not acquire jurisdiction over the taxpayer's petition.

II. 2015 CASES Pilipinas Total Gas, Inc. vs CIR, GR 207112, 08 December 2015 Rule prior to 11 June 2014: from the date an administrative claim for excess

unutilized VAT is filed, a taxpayer has thirty (30) days within which to submit the documentary requirements sufficient to support his claim, unless given further extension by the CIR. Then, upon filing by the taxpayer of his complete documents to support his application, or expiration of the period given, the CIR has 120 days within which to decide the claim for tax credit or refund. Should the taxpayer, on the date of his filing, manifest that he no longer wishes to submit any other addition documents to complete his administrative claim, the 120 day period allowed to the CIR begins to run from the date of filing. 2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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RMC 54-2014 effective 11 June 2014: now requires the reckoning of the 120day period from the time TX files his administrative claim for refund within 2 years from close of quarter. At that time of filing, he is required to complete his supporting documents and attest that he will no longer submit any other document to prove his claim. Further, the taxpayer is barred from submitting additional documents after he has filed his administrative claim.

CIR vs. NIPPON EXPRESS (PHILS.) CORPORATION G.R. No. 212920, September 16, 2015 BIR issued Tax credit certificate pending TX petition for review before the CTA Division. TX filed a motion to withdraw the petition for review. An appeal may be withdrawn as of right at any time before the filing of the appellee's brief. Thereafter, the withdrawal may be allowed in the discretion of the court. In this case however, CTA DIV should not have granted the motion to withdraw considering that the Decision was rendered by the CTA Division after a full-blown hearing in which the parties had already ventilated their claims. Thus, the findings contained therein were the results of an exhaustive study of the pleadings and a judicious evaluation of the evidence submitted by the parties, as well as the report of the commissioned certified public accountant. Jurisdiction, once acquired, is not lost upon the instance of the parties, but continues until the case is terminated. When petitioner filed her Petition for Certiorari jurisdiction vested in the Court and, in fact, the Court exercised such jurisdiction when it acted on the petition. Such jurisdiction cannot be lost by the unilateral withdrawal of the petition by petitioner. The CTA DIV found that TX was only entitled to refund the reduced amount of P2,614,296.84 since it failed to prove that the recipients of its services were non-residents "doing business outside the Philippines"; hence, Nippon's purported sales therefrom could not qualify as zero-rated sales, necessitating the reduction in the amount of refund claimed. On the other hand, the tax credit certificate provides for the amount of P21,675,128.91 which is, in all, P19,060,832.07 larger than the amount found due by the CTA Division. VIP CASE:

BOC vs THE HONORABLE AGNES VST DEVANADERA, ACTING SECRETARY, DEPARTMENT OF JUSTICE, et.al G.R. No. 193253, September 08, 2015 CTA has jurisdiction over a special civil action for certiorari questioning an interlocutory order of the RTC in a local tax case. CTA has original jurisdiction over a petition for certiorari assailing the DOJ resolution in a preliminary investigation involving tax and tariff offenses. CA's original jurisdiction over a petition for certiorari assailing the DOJ resolution in a preliminary investigation involving tax and tariff offenses was necessarily transferred to the CTA and that such petition shall be governed by Rule 65 of the Rules of Court, as amended. Accordingly, it is the CTA, not the CA, which has jurisdiction over the petition for certiorari assailing the DOJ resolution of dismissal of the BOC's complaint-affidavit against private respondents for violation of the TCCR.

CIR vs. TOLEDO POWER COMPANY, Respondent. G.R. No. 195175, G.R. NO. 199645 August 10, 2015 2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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Periods in filing claim for refund under Section 112 and appeal to CTA DIV: 2:120:30

CIR vs STANDARD CHARTERED BANK, Respondent. G.R. No. 192173, July 29, 2015 Requirements of a valid waiver of prescriptive period: 1. signatures of both the CIR and the taxpayer; 2. date of acceptance by the BIR is necessary in order to determine whether the parties (the taxpayer and the government) had entered into a waiver “before the expiration of the time prescribed in Section 203 (the three-year prescriptive period) for the assessment of the tax; 3. The waiver should be duly notarized; 4. CIR or the revenue official authorized by him must sign the waiver indicating that the BIR has accepted and agreed to the waiver. The date of such acceptance by the BIR should be indicated; 5. waiver must be executed in three copies, the original copy to be attached to the docket of the case, the second copy for the taxpayer and the third copy for the Office accepting the waiver

CIR vs CTA AND CBK POWER COMPANY LIMITED G.R. Nos. 203054-55, July 29, 2015 CTA Order dated December 23, 2011 granting private respondent's motion to declare petitioner as in default and allowing respondent to present its evidence ex parte, is an interlocutory order as it did not finally dispose of the case on the merits but will proceed for the reception of the former's evidence to determine its entitlement to its judicial claim for tax credit certificates. Even the CTA's subsequent orders denying petitioner's motion to lift order of default and denying reconsideration thereof are all interlocutory orders since they pertain to the order of default. Since the CTA Orders are merely interlocutory, no appeal can be taken therefrom. Remedy is to file appropriate special civil action for certiorari under Rule 65 before the Supreme Court. Filing a petition for review before the CTA EB is not the proper remedy;

CIR vs. AIR LIQUIDE PHILIPPINES, INC., G.R. No. 210646 July 29 2016

2:120:30 CIR vs CTA (SECOND DIVISION) AND PETRON CORPORATION G.R. No. 207843, July 15, 2015 CIR's interpretation of a tax provision involves an exercise of her quasilegislative functions, the proper recourse against the subject tax ruling is a review by the Secretary of Finance and ultimately the regular courts. The power to interpret the provisions of NIRC and other tax laws shall be under the exclusive and original jurisdiction of the Commissioner, subject to review by the Secretary of Finance. The power to decide disputed assessments, refunds of internal revenue taxes, 2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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fees or other charges, penalties imposed in relation thereto, or other matters arising under NIRC or other laws or portions thereof administered by the Bureau of Internal Revenue is vested in the Commissioner, subject to the exclusive appellate jurisdiction of the Court of Tax Appeals

HEDCOR VS CIR, GR 207575 15 July 2015 Under Section 112, NIRC, the 120 day period of “inaction” on the part of BIR is counted from the time of complete submission of documents. Under the current rule at the time of filing of refund, TX states that he has completely submitted documents, thus, 120 period begins to run; The period of 120 days is a prerequisite for the commencement of the 30-day period to appeal.

City of Davao vs. Intestate Estate of Amado Dalisay GR 207791 July 15, 2015; Under LGC of 1991, in case of forfeiture of real property (sold at public auction and without any bidder), redemption period of 1 year is reckoned from date of purchase by LGU ( date of auction/sale) of the property for want of any bidder NOT from issuance by LGU of certificate of forfeiture. Forfeiture of tax delinquent properties transpires no later than the purchase made by the city due to lack of a bidder from the public. This happens on the date of the sale, and not upon the issuance of the declaration of forfeiture.

Batangas City vs Pilipinas Shell Petroleum Corporation GR 187631 July 8 2015; Is the LGU empowered under the LGC to impose business taxes on persons or entities engaged in the business of manufacturing and distribution of petroleum products? Section 133 of the LGC is a specific provision that explicitly withhold from LGUs the power to impose taxes, fees and charges on petroleum products. Strictly speaking, as long as the subject matter of the taxing powers of the LGUs is the petroleum products per se or even the activity or privilege related to the petroleum products, such as manufacturing and distribution of said products, it is covered by the said limitation and thus, no levy can be imposed; Article 232 of LGC defines with more particularity the capacity of a municipality to impose business taxes on businesses except businesses engaged in the production, manufacture, refining, distribution or sale of oil, gasoline, and other petroleum products;

Clark Investors and Locators Association Inc. vs Sec of Finance and CIR GR 200670 July 6 2016 BIR issued RR 2-2012 imposing the VAT and excise tax on the importation of petroleum and petroleum products from abroad and into the Freeport or Economic Zones. RR 2-2012 unilaterally revoked the tax exemption granted by RA No. 7227 and RA No. 9400 to the businesses and enterprises operating within the Subic Special Economic Zone and Clark Freeport Zone. BIR’s act of issuing RR 2-2012 is not in the exercise of any judicial or quasijudicial capacity, thus, petition for certiorari under Rule 65 of Rules on Civil Procedure is NOT the proper remedy. RR 2- 2012 was issued in the exercise of BIR’s quasi-legislative or rule-making powers; 2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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Fortune Tobacco Corporation vs CIR GR 192024 July 1 2015 The settled rule is that only questions of law may be raised in a petition for review on certiorari under Rule 45 of the Rules of Court. The resolution of factual issues is the function of the lower courts, whose findings on these matters are received with respect. A question of law which the Court may pass upon must not involve an examination of the probative value of the evidence presented by the litigants The sufficiency of a TX’s evidence and the determination of the amount of refund are questions of fact, which are for the judicious determination by the CTA of the evidence on record. It is petitioner's burden to prove the allegations made in its claim for refund. For a claim for refund to be granted, the manner in proving it must be in accordance with the prescribed rules of evidence. It would have been erroneous had the CTA En Banc relied on petitioner's own Excise Tax Refund Computation Summary or the unsatisfactory explanation of its lone witness to justify its claim for tax refund.

Chinabanking Corporation vs City Treasurer of Manila GR 204117 July 1 2015 In claim for refund of local taxes and after the Treasurer denies the claim for refund, where the amount sought to be refunded is below the jurisdictional amount of the RTC, the Metropolitan, Municipal, and Municipal Circuit Trial Courts are clothed with ample authority to rule on such claims; Under R.A. No. 9282, the authority to exercise either original or appellate jurisdiction by the MTC or the RTC over local tax cases depended on the amount of the claim.

MITSUBISHI MOTORS PHILIPPINES CORPORATION VS BOC GR 209830 JUNE 17 2015 BOC filed collection case against Mitsubishi before the RTC, Manila. RTC granted Mitsubishi’s demurrer to evidence and dismissed the collection case. BOC filed a notice of appeal to Court of Appeals. CA, instead of dismissing the notice of appeal for lack of jurisdiction, referred the records of the collection case to the CTA for proper disposition of the appeal taken by respondent. Ruling: CTA has exclusive appellate jurisdiction over tax collection cases originally decided by the RTC. CA has no jurisdiction over respondent’s appeal; hence, it cannot perform any action on the same except to order its dismissal. Therefore, the act of the CA in referring respondent’s wrongful appeal before it to the CTA under the guise of furthering the interests of substantial justice is NOT PROPER;

Mactan Cebu International Airport Authority vs City of Lapu-Lapu GR 181756 June 15 2015 Airfield, runway and taxiway and the lots on which the runway and taxiway are located, owned by the State or by the Republic of the Philippines and are merely held in trust by the MCIAA, notwithstanding that certificates of titles thereto may have been issued in the name of the MCIAA. MCIAA being an instrumentality of the government, NOT A GOCC, is exempt from RPT, Special Education Fund, penalty, and interest; 2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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If government instrumentality is organized as a stock or non-stock corporation considered as GOCC which is not exempt from RPT. If instrumentality is not organized as stock or non-stock corporation, it remains a government instrumentality exercising not only governmental but also corporate powers, thus exempt from RPT; Examples of government instrumentalities exempt from RPT: MIAA, GSIS, Philippine Fisheries Development Authority, University of the Philippines, Bangko Sentral ng Pilipinas Only portions of the Airport Lands and Buildings leased to taxable persons like private parties are subject to real estate tax; Properties of public dominion are not subject to execution or foreclosure sale by the LGU;

SILICON PHILIPPINES VS CIR GR 173241 25 MARCH 2015 2:120:30: SUMMARY OF RULES ON PRESCRIPTIVE PERIODS FOR CLAIMING REFUND OR CREDIT OF INPUT VAT

EASTERN TELECOMMUNICATIONS PHILIPPINES VS CIR GR 183531 25 MARCH 2015 Invoicing requirements in claims for refund under Section 112: In claims for refund of excess input Vat on zero rated transactions, The word “zero-rated” is

required on the invoices or receipts issued by VAT-registered taxpayers. PNB vs CIR GR 206019 18 March 2015

PNB foreclosed REM over EVER GOTESCO MALL. After expiration of redemption period, PNB paid the CWT of 6% instead of 5% CWT on sale of ordinary asset, and surcharges, penalties and interests. In the claim for refund, PNB claims that GOTESCO did not utilize as tax credit the withheld taxes of 6% and DST. Requirements for valid claim for refund: 1. Claimed creditable withholding tax was withheld and remitted to the BIR; 2. Withholding and remittance was erroneous; and 3. Claimed creditable withholding tax was not used by Gotesco to settle its tax liabilities. Burden of proving entitlement to a tax refund is on the taxpayer which necessarily includes the filing of complete supporting documents to prove entitlement for the refund. Otherwise, the mere filing of an application without any supporting document would be as good as filing a mere scrap of paper.

Northern Mindanao Power Corporation Vs. CIR 
 G.R. No. 185115 February 18, 2015 "Sales or commercial invoice" is a written account of goods sold or services rendered indicating the prices charged therefor or a list by whatever name it is known which is used in the ordinary course of business evidencing sale and transfer or agreement to sell or transfer goods and services. 2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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“Receipt" on the other hand is a written acknowledgment of the fact of payment in money or other settlement between seller and buyer of goods, debtor or creditor, or person rendering services and client or customer. A VAT invoice is the seller's best proof of the sale of goods or services to the buyer, while a VAT receipt is the buyer's best evidence of the payment of goods or services received from the seller. A VAT invoice and a VAT receipt should not be confused and made to refer to one and the same thing. FOR PURPOSES OF CLAIMING CREDIT OR REFUND OF INPUT VAT, VAT INVOICE IS REQUIRED;

Republic of the Philippines, represented by the CIR Vs. Team (Philippines) Energy Corporation (formerly Mirant [Philippines] Energy Corporation) G.R. No. 188016. January 14, 2015 TX cannot get a tax refund and a tax credit at the same time for the same excess income taxes paid. These two are alternative in nature.

III. 2014 CASES CIR vs. Silicon Philippines, Inc. (formerly Intel Philippines Manufacturing, Inc.), G.R. No. 169778. March 12, 2014; MIRAMAR FISH COMPANY, INC., Petitioner, vs. CIR , Respondent. G.R. No. 185432 , June 4, 2014; Taganito Mining Corporation Vs. CIR G.R. No. 197591. June 18, 2014; San Roque Power Corporation Vs. CIR G.R. No. 205543. June 30, 2014; CIR Vs. Team Sual Corporation, etc. G.R. No. 205055 July 18, 2014; CIR Vs. CE Luzon Geothermal Power Company, Inc.
 G.R. No. 190198 September 17, 2014; CNK Power Company Limited Vs. CIR G.R. No. 202066/G.R. No. 205353. September 30, 2014; CIR Vs. Aichi Forging Company of Asia, Inc.
 G.R. No. 183421. October 22, 2014 Period of Refund of excess input VAT in 0% transaction: - 2 yrs from close of the quarter when sales are made; - CIR is given 120 days from receipt to decide: - If denied or 120 day period expires without decision from CIR, TX may file an appeal to CTA Division (30 days), any prejudiced party files an appeal to CTA En Banc ( 15 days), and lastly, prejudiced party goes to SC (15 days); Invoicing of VAT: Words “zero-rated” should be indicated; Absence of such words is FATAL and input VAT will not be credited, if absent; BIR authority to print NEED NOT be reflected or indicated in the receipts;

CIR vs. Team (Philippines) Operations Corporation (formerly Mirant Phils., Operation Corporation) G.R. No. 179260. April 2, 2014 Conditions for claim for refund of creditable w/holding taxes (1) Claim filed with CIR within two-year period from the date of payment of the tax; (2) It is shown on the return of the recipient that the income payment received was declared as part of the gross income; and

2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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(3) Fact of withholding is established by a copy of a statement duly issued by the payor to the payee showing the amount paid and the amount of the tax withheld therefrom; (4) Strict observance of the concept of the irrevocability rule ( if already applied to other quarters, can no longer be applied for refund)

Coca-Cola Bottlers Philippines, Inc. Vs. City of Manila, et al. G.R. No. 197561. April 7, 2014 Refund/Credit of Local Tax • Section 252 (c) LGC of 1991, if protest is favorable to TX, amount of tax shall be refunded to TX; • No need to apply for writ of execution before ordinary courts;

Visayas Geothermal Power Company Vs. CIR
 G.R. No. 197525. June 4, 2014 Refund of excess input VAT: 2 yrs from close of quarter; 120 days + 30 days; 1. Government cannot be estopped by the mistakes, errors or omissions of its agents; 2. Estoppel does not apply to the government, especially on matters of taxation; 3. Taxes are the nation’s lifeblood through which government agencies continue to operate and with which the State discharges its functions for the welfare of its constituents; 4. Upon taxation depends the ability of the government to serve the people for whose benefit taxes are collected. To safeguard such interest, neglect or omission of government officials entrusted with the collection of taxes should not be allowed to bring harm or detriment to the people.

CIR vs. United Salvage and Towage (Phils.), Inc
 G.R. No. 197515. July 2, 2014 CTA as a court; Rules on Evidence 1. CTA is categorically described as a court of record; 2. It has power to promulgate rules and regulations for the conduct of its business, and as may be needed, for the uniformity of decisions within its jurisdiction; 3. Cases filed before it are litigated de novo, party-litigants shall prove every minute aspect of their cases, thus, rules on formal offer of documentary evidence shall apply; PANs as evidence of the taxpayer’s liability is not mere procedural technicality. It is a means by which a taxpayer is informed of his liability for deficiency taxes. It serves as basis for the taxpayer to answer the notices, present his case and adduce supporting evidence. FAN: TX must be informed in writing of the legal and factual bases of the tax assessment made against him. The use of the word “shall” in the law indicates the mandatory nature of the requirements. Any short-cuts to the prescribed content of the assessment or the process thereof should not be countenanced.

2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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Commissioner of Customs Vs. Oilink International Corporation 
 G.R. No. 161759. July 2, 2014 CTA: exclusive appellate jurisdiction to review by appeal “ Decisions of the BOC Commissioner in cases involving liability for Customs duties, fees or other money charges; seizure, detention or release of property affected; fines, forfeitures or other penalties imposed in relation thereto; or other matters arising under the Customs Law or other law or part of law administered by the Bureau of Customs; Decision that is appealable to the CTA is a judgment or order of the Commissioner of Customs that is final in nature, not merely an interlocutory order;

Nursery Care Corporation, et al. Vs. Anthony Acevedo, in his capacity as the Treasurer of Manila, and The City of Manila
 G.R. No. 180651. July 30, 2014 There is double taxation when the same taxpayer is taxed twice when he should be taxed only once for the same purpose by the same taxing authority within the same jurisdiction during the same taxing period, and the taxes are of the same kind or character. Double taxation is obnoxious

Duty Free Philippines Vs. BIR , represented by Hon. Anselmo G. Adriano, acting Regional Director, Revenue Region 8, Makati City
 G.R. No. 197228. October 8, 2014 • •

•

R.A. No. 9282: elevated the rank of the CTA to the level of a collegiate court, making it a co-equal body of the Court of Appeals. Section 2, Rule 4 of the Revised Rules of the CTA reiterates the exclusive appellate jurisdiction of the CTA en banc relative to the review of the decision of the CTA Division on motion for reconsideration or new trial in cases arising from administrative agencies such as the BIR. CA is without jurisdiction to review decisions rendered by a division of the CTA, exclusive appellate jurisdiction over which is vested in the CTA en banc.

CIR Vs. Burmeistor and Wainscandinavian Contractor Mindanao, Inc. G.R. No. 190021. October 22, 2014 1. The inaction of the CIR on the claim during the 120-day period is, by express provision of law, "deemed a denial" of such claim; 2. Failure of TX to file its judicial claim within 30 days from the expiration of the 120-day period shall render the "deemed a denial" decision of the CIR final and inappealable. 3. The right to appeal to the CTA from a decision or "deemed a denial" decision of the Commissioner is merely a statutory privilege, not a constitutional right. The exercise of such statutory privilege requires strict compliance with the conditions attached by the statute for its exercise.

SMI-ED Philippine Technology, Inc. Vs. CIR G.R. No. 175410 November 12, 2014 In an action for the refund of taxes allegedly erroneously paid, CTA may determine whether there are taxes that should have been paid in lieu of the taxes paid. Determining the proper category of tax that should have been paid 2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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is not an assessment. It is incidental to determining whether there should be a refund. CTA has no assessment powers. In stating that petitioner’s transactions are subject to capital gains tax, however, the CTA was not making an assessment. It was merely determining the proper category of tax that petitioner should have paid; The determination of the proper category of tax that petitioner should have paid is an incidental matter necessary for the resolution of the principal issue, which is whether petitioner was entitled to a refund “capital assets” : TX’s property that is NOT any of the following: 1.Stockintrade; 2. Property that should be included in the TX’s inventory at the close of the taxableyear; 3. Property held for sale in the ordinary course of the taxpayer’s business; 4. Depreciable property used in t/b; and 5. Real property used in the t/b. Properties involved in this case include buildings, equipment, and machineries. None of the properties were used in petitioner’s trade or ordinary course of business because TX never commenced operations. They were not part of the inventory. None of them were stocks in trade. Individuals: CGT of 6% on sale of on L, B, machineries, and equipment treated as capital assets; Corporations: CGT of 6% on sale of land and buildings only; Corporate income tax on sale of machineries/equipment treated as capital assets;

Corporate Strategies Development Corporation and Rafael R. Prieto Vs. Norman A. Agojo G.R. No. 208740 November 19, 2014 Burden to prove compliance with the validity of the proceedings leading up to the tax delinquency sale of real property is incumbent upon the buyer or the winning bidder; Requisites of Tax Delinquency Sale ( LGC of 1991): 1. Posting of notice of delinquency at the main hall and in a publicly accessible and conspicuous place in each barangay of the LGU; 2. Publication once a week for two (2) consecutive weeks, in a newspaper of general circulation in the province, city, or municipality; 3. If Treasurer issues a warrant of levy (WL), mail or serve WL to delinquent owner of the real property or person having legal interest therein, or in case he is out of the country or cannot be located, the administrator or occupant of the property. 4. Notice with the attached WL mailed to or served upon the Assessor and the Registrar of Deeds; 5. Within thirty (30) days after service of the WL, the local treasurer shall publicly advertise for sale or auction the property or a usable portion thereof; 6. Advertisement shall be effected by posting a notice at the main entrance of the provincial, city or municipal building, and in a publicly accessible and conspicuous place in the barangay where the real 2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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property is located, and by publication once a week for two (2) weeks in a newspaper of general circulation in the province, city or municipality where the property is located.

Honda Cars Philippines, Inc. Vs. Honda Cars Technical Specialist and Supervisors Union 
 G.R. No. 204142 November 19, 2014 Voluntary Arbitrator in Labor Disputes: No competence to rule on the taxability of the gas allowance and on the propriety of the withholding of tax. These issues are clearly tax matters, and do not involve labor disputes.

Philippine American Life and General Insurance Company Vs. Secretary of Finance and the CIR
 G.R. No. 210987 November 24, 2014 Is the ruling of the Commissioner of BIR subject to review by the Secretary of Finance under Sec. 4 of the NIRC, and that of the Secretary to the CA via Rule 43? CTA is the proper forum with which to institute the appeal. This is not, and should not, in any way, be taken as a derogation of the power of the Office of President but merely as recognition that matters calling for technical knowledge should be handled by the agency or quasi- judicial body with specialization over the controversy. CTA has the power to determine whether or not there has been grave abuse of discretion amounting to lack or excess of jurisdiction on the part of the RTC in issuing an interlocutory order in cases falling within the exclusive appellate jurisdiction of the tax court. CTA, by constitutional mandate, is vested with jurisdiction to issue writs of certiorari in these cases

National Power Corporation Vs. Municipal Government of Navotas, et al. G.R. No. 192300 November 24, 2014 Issue: whether or not the CTA Second Division has jurisdiction to review the decision of the RTC which concerns a petition for declaratory relief involving real property taxes. Answer: Yes, CTA has jurisdiction over decisions, orders or resolutions of the RTC in local tax cases, to wit: Decisions, orders or resolutions of the Regional

Trial Courts in local tax cases originally decided or resolved by them in the exercise of their original or appellate jurisdiction; CIR Vs. Basf + Inks Phils, Inc. 
 G.R. No. 198677 November 26, 2014

The suspension of the three-year period to assess on the ground that the TX cannot be located in the address indicated in the return, applies only if the BIR Commissioner is not aware of the whereabouts of the taxpayer.

City of Lapu-Lapu Vs. Philippine Economic Zone Authority/Prove of Bataan, represented by Governor Enrique T. Garcia, Jr., and Emerlinda S. Talento, in her capacity as Provincial Treasurer of Bataan Vs. Philippine Economic Zone Authority
 G.R. No. 184203/G.R. No. 187583 November 26, 2014

2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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The Philippine Economic Zone Authority is exempt from payment of real property taxes. PEZA is an instrumentality of the national government; An instrumentality is “any agency of the National Government, not integrated within the department framework, vested with special functions or jurisdiction by law, endowed with some if not all corporate powers, administering special funds, and enjoying operational autonomy, usually through a charter.”

CIR vs. Stanley Works Sales (Phils.), Incorporated December 3, 2014

G.R. No. 187589

1. The waiver must be in the prescribed BIR form; 2. Signed by the TX, signed by BIR authorized officer indicating that the Bureau has accepted and agreed to the waiver. The date of such acceptance by the Bureau should be indicated. 3. Both the date of execution by the taxpayer and date of acceptance by the Bureau should be before the expiration of the period of prescription or before the lapse of the period agreed upon in case a subsequent agreement is executed 4. Waiver must be executed in three copies, the original copy to be attached to the docket of the case, the second copy for the TX and the third copy for the Office accepting the waiver.

Samar-I Electric Cooperative Vs. CIR 
 G.R. No. 13100. December 10, 2014 Requisites of a valid FAN: 1. Issued by the Commissioner or his duly authorized representative; 2. FAN provides for payment of the taxpayer’s deficiency tax or taxes, the facts, the law, rules and regulations, or jurisprudence on which the assessment is based, otherwise, the formal letter of demand and assessment notice shall be void; 3. The same shall be sent to the taxpayer only by registered mail or by personal delivery. The advice of tax deficiency, given by the CIR to an employee as well as the preliminary five-day letter, were not valid substitutes for the mandatory notice in writing of the legal and factual bases of the assessment.

GOOD LUCK TO BARRISTERS!!!!!!!

2016 Taxation Law Summary of Important Case Doctrines by Atty. Rizalina V. Lumbera for Jurists Bar Review Center. All rights reserved 2016 by Jurists Review Center Inc. Unauthorized reproduction, use, or dissemination strictly prohibited and shall be prosecuted to the full extent of the law, including administrative complaints with the Office of the Bar Confidant, Supreme Court.

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