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Commissioner of Internal Revenue v. Aichi Forging Company of Asia, Inc., G.R. No. 184823, 06 October 2010

24 Nov

[DEL CASTILLO, J.]

 

FACTS

Respondent Aichi filed a claim for refund/credit of input VAT for the period July 1, 2002 to September 30, 2002, with the petitioner Commissioner of Internal Revenue (CIR), through the Department of Finance (DOF) One-Stop Shop Inter-Agency Tax Credit and Duty Drawback Center.On even date, respondent filed a Petition for Review with the CTA for the refund/credit of the same input VAT.  The CTA partially granted the petition. In a Motion for Reconsideration, petitioner argued that the simultaneous filing of the administrative and the judicial claims contravenes Sections 112 and 229 of the NIRC and a prior filing of an administrative claim is a “condition precedent” before a judicial claim can be filed. The CTA En Banc affirmed the division ruling.

 

ISSUE

Whether the respondent’s judicial and administrative claims for tax refund/credit were filed within the two-year prescriptive period as provided in Sections 112(A) and 229 of the NIRC.

 

HELD

NO.

The two-year period to file a claim for tax refund/credit for the period July 1, 2002 to September 30, 2002 expired on September 30, 2004. Hence, respondent’s administrative claim was timely filed.The filing of the judicial claim was premature. However, notwithstanding the timely filing of the administrative claim, [the Supreme Court is] constrained to deny respondent’s claim for tax refund/credit for having been filed in violation of Section 112(D). Section 112(D) of the NIRC clearly provides that the CIR has “120 days, from the date of the submission of the complete documents in support of the application [for tax refund/credit],” within which to grant or deny the claim. In case of full or partial denial by the CIR, the taxpayer’s recourse is to file an appeal before the CTA within 30 days from receipt of the decision of the CIR. However, if after the 120-day period the CIR fails to act on the application for tax refund/credit, the remedy of the taxpayer is to appeal the inaction of the CIR to CTA within 30 days.

In this case, the administrative and the judicial claims were simultaneously filed on September 30, 2004. Obviously, respondent did not wait for the decision of the CIR or the lapse of the 120-day period. For this reason, we find the filing of the judicial claim with the CTA premature. The premature filing of respondent’s claim for refund/credit of input VAT before the CTA warrants a dismissal inasmuch as no jurisdiction was acquired by the CTA.

 
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Posted by on November 24, 2015 in Case Digests, Taxation Law

 

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