G.R. No. 207112 Case Digest

G.R. No. 207112, December 8, 2015

Pilipinas Total Gas, Inc.

vs CIR

Facts:

Total Gas is engaged in the business of selling, transporting and distributing industrial gas, sale of gas equipment and other related business. For this purpose, Total Gas registered itself with BIR as VAT taxpayer.

For the 1st and 2nd quarters of 2007, Total Gas claimed VAT credits from its domestic purchases of non capital goods and services. Later, they filed an administrative claim for refund of the unutilized VAT for the 1st two quarters of 2007. Due to the inaction of CIR, Total Gas elevated their claim to the CTA.

CTA dismissed the petition for being prematurely filed, saying that Total Gas failed to complete necessary documents to substantiate a claim for refund. Motion for reconsideration was denied too by the CTA.

CTA En Banc also denied the petition to review. It ruled that CTA division had no jurisdiction over the case because Total Gas failed to seasonably file its petition.

Issues:

(a) whether the judicial claim for refund was belatedly filed on 23 January 2009, or way beyond the 30-day period to appeal as provided in Section 112(c) of the Tax Code, as amended; and

(b) whether the submission of incomplete documents at the administrative level (BIR) renders the judicial claim premature and dismissible for lack of jurisdiction.

Ruling:

Petition has merit.

Judicial claim timely filed. CIR has 120 days from the date of submission of complete documents to decide a claim for tax credit or refund. CTA counted the period from May 15, 2008.

Indeed, the 120-day period granted to the CIR to decide the administrative claim under the Section 112 is primarily intended to benefit the taxpayer, to ensure that his claim is decided judiciously and expeditiously. After all, the sooner the taxpayer successfully processes his refund, the sooner can such resources be further reinvested to the business translating to greater efficiencies and productivities that would ultimately uplift the general welfare. To allow the CIR to determine the completeness of the documents submitted and, thus, dictate the running of the 120-day period, would undermine these objectives, as it would provide the CIR the unbridled power to indefinitely delay the administrative claim, which would ultimately prevent the filing of a judicial claim with the CTA.