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CIR v. PBCOM

The Supreme Court ruled that (1) failure to comply with requirements for an administrative claim for creditable withholding tax (CWT) refund/credit does not preclude filing a judicial claim, (2) the Court of Tax Appeals decides cases de novo based solely on evidence presented to it rather than evidence submitted to the Commissioner of Internal Revenue, and (3) the law allows simultaneous filing of administrative and judicial claims for CWT refund/credit within two years, with no requirement that the administrative claim be acted on first.

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376 views7 pages

CIR v. PBCOM

The Supreme Court ruled that (1) failure to comply with requirements for an administrative claim for creditable withholding tax (CWT) refund/credit does not preclude filing a judicial claim, (2) the Court of Tax Appeals decides cases de novo based solely on evidence presented to it rather than evidence submitted to the Commissioner of Internal Revenue, and (3) the law allows simultaneous filing of administrative and judicial claims for CWT refund/credit within two years, with no requirement that the administrative claim be acted on first.

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cdacasidsid
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We take content rights seriously. If you suspect this is your content, claim it here.
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Commissioner of Internal Revenue v.

Philippine Bank of Communications


G.R. No. 211348. February 23, 2022.
The Facts of the Case
In 2007, the Philippine Bank of Communications (PBCOM) filed with
the BIR its Annual Income Tax Return for the year 2006. Subsequently,
PBCOM filed an Amended Annual Income Tax Return for the same
year reflecting a net loss, and a creditable tax withheld for the fourth
quarter of 2006. Respondent also indicated in the said income tax
return its intention to apply for the issuance of a Tax Credit Certificate
(TCC) for its excess/unutilized Creditable Withholding Tax (CWT) for
the year 2006.
The Facts of the Case
In 2009, PBCOM filed a petition for review with the CTA for the
issuance of a TCC representing its excess/unutilized CWT for the year
2006. It also alleged that it was filing the said petition due to the
inaction of the CIR on the former’s claim for TCC.

CIR argued that PBCOM’s claim for the issuance of a TCC is in the
nature of a refund and is thus subject to administrative examination of
the BIR.
Issue
Does the failure in proving an administrative
claim for CWT refund/credit preclude the
judicial claim of the same? — No.
Ruling of the Court
No. Failure to comply with the requirements of an administrative claim for CWT
refund/credit does not preclude its judicial claim.

CTA is described as a court of record. As cases filed before it are litigated de novo, party
litigants should prove every minute aspect of their cases. No evidentiary value can be
given to the purchase invoices or receipts submitted to BIR as the rules on documentary
evidence require that these documents must be formally offered before the CTA.
Ruling of the Court
Since the claim for tax refund/credit was litigated before the CTA, the latter’s decision
should be solely based on the evidence formally presented before it, notwithstanding any
pieces of evidence that may have been submitted (or not submitted) to the CIR. Thus,
what is vital in the determination of a judicial claim for tax credit/refund of CWT is the
evidence presented before the CTA, regardless of the body of evidence found in the
administrative claim.
Ruling of the Court
The Court has explained that the CTA is not limited by the evidence presented in the
administrative claim. In any event, the independence of the judicial claim for a tax
credit/refund CWT from its administrative counterpart is implied in the NIRC, which
allows the filing of both claims contemporaneously within the 2-year prescriptive period.
The only requirement for a judicial claim of tax credit/refund to be maintained is that a
claim of refund or credit has been filed before the CIR; there is no mention in the law
that the claim before the CIR should be acted upon first before a judicial claim may be
filed.

Clearly, the arguments of the petitioner regarding the prematurity of the judicial claims
are untenable.

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