THE Court of Tax Appeals (CTA) has affirmed a division ruling which partially granted Philippine Geothermal Production Co., Inc.’s refund claim worth P4.24 million of its excess input value-added tax traced to zero-rated sales for the 2014 fiscal year.
In a 16-page decision on Aug. 17 and made public on Aug. 26, the CTA full court said it found no legal basis to overturn its decision granting the VAT refund.
“Based on the foregoing judicial pronouncements, the power of the CTA to exercise its appellate jurisdiction does not preclude it from considering evidence that was not presented in the administrative claim in the Bureau of Internal Revenue,” according to the ruling penned by Associate Justice Erlinda P. Uy.
“Accordingly, the court may give credence to all evidence presented by the taxpayer claimant, irrespective of whether or not they were submitted at the administrative level.”
The commissioner of internal revenue (CIR) argued the tribunal made an error in considering documents submitted by the company that were not submitted at the administrative level.
The CTA partially granted the firm’s petition to refund P4.24 million out of its P5.26-million claim of excess input VAT.
The court asserted that it was within its discretion to grant a petition based on the evidence presented.
It also cited the country’s revenue code as it provides that it is not required for a taxpayer to directly attribute its claimed input tax to zero-rated sales to be creditable.
Under the law, zero-rated sales are transactions made by VAT-registered taxpayers that do not result in any output tax.
The tribunal ruled that the CIR failed to provide evidence to support its argument, as the court maintained it did not abuse its discretion in its ruling.
“The mere general averment of the CIR failed to convince this court en banc that a reversible error was committed by the court in division that would warrant the modification or reversal of the assailed decision and resolution,” said the tax court. — John Victor D. Ordoñez
