Intel Tech

7/24/2019 Intel Tech

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G.R. No. 166732 April 27, 2007

INTEL TECHNOLOGY PHILIPPINES, INC., Petitioner,vs.COMMISSIONER OF INTERNAL REVENE,Respondent.

D E C I S I O N

CALLE!O, SR., J.:

Before the Court is a Petition for Review on Certiorari filed byIntel e!hnolo"y Philippines, In!. #petitioner$ see%in" to reverseand set aside the De!ision&dated 'u"ust &(, ())* of the Court of

'ppeals #C'$ in C'+.R. SP No. -/(-. he assailed de!isionaffir0ed that of the Court of a1 'ppeals denyin" petitioner2s!lai0 for a refund or issuan!e of a ta1 !redit !ertifi!ate in thea0ount of P&&,--),&3&.-), alle"edly representin" the value+added input ta1es it had paid on do0esti! pur!hases of "oodsand servi!es for the period of 'pril &, &3 to 4une /), &3.

5i%ewise sou"ht to be reversed and set aside is the appellate!ourt2s Resolution(dated 4anuary &*, ())6 denyin" petitioner2s7otion for Re!onsideration.

he 'nte!edents

Petitioner is a do0esti! !orporation en"a"ed pri0arily in thebusiness of desi"nin", developin", 0anufa!turin" and e1portin"advan!ed and lar"e+ s!ale inte"rated !ir!uit !o0ponents #ICs$./Itis re"istered with the Bureau of Internal Revenue #BIR$ as avalue+added ta1 #8'$ entity in &9 under Certifi!ate ofRe"istration RDO Control No. 9+6*)+)))-&/.*It is li%ewise

re"istered with the Philippine E!ono0i! :one 'uthority #PE:'$ asan E!o;one e1port enterprise.6

's a 8'+re"istered entity, petitioner filed with the Co00ission ofInternal Revenue its 7onthly 8' De!larations and


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pur!hases of "oods and servi!es in the total a0ountof P&&,--),&3&.-). Petitioner alle"ed that its ;ero+rated e1portsales were paid for in a!!eptable forei"n !urren!y and wereinwardly re0itted in a!!ordan!e with the re"ulations of the

Ban"%o Sentral n" Pilipinas #BSP$.

On 7ay &3, &, petitioner filed with the Co00ission of InternalRevenue, throu"h its One+Stop Shop Inter+'"en!y a1 Credit andDuty Drawba!% Center of the Depart0ent of >inan!e, a !lai0 forta1 !redit?refund of 8' input ta1es on its do0esti! pur!hases of"oods and servi!es dire!tly used in its !o00er!ial operations.Petitioner2s !lai0 for refund a0ounted to P&&,--),&3&.-)!overin" the period 'pril &, &3 to 4une /), &3.9

On 4une /), ())), when the two+year pres!riptive period to file arefund was about to lapse without any a!tion by the Co00issionof Internal Revenue on its !lai0, petitioner filed with the Court ofa1 'ppeals #C'$ a petition for review with the Co00issioner ofInternal Revenue #Co00issioner$ as respondent.-Petitioneralle"ed therein that@

/. Petitioner is en"a"ed pri0arily in the business ofdesi"nin", developin", 0anufa!turin" and e1portin"advan!ed and lar"e+s!ale inte"rated !ir!uit !o0ponents,!o00only referred to in the industry as Inte"rated Cir!uitsor AICs.A 's su!h, it has re"istered itself as a value+addedta1 entity pursuant to Se!tion &)- of the a1 Code effe!tive4anuary /), &9, pursuant to whi!h it was issuedCertifi!ate of Re"istration No. 9+6*)+)))-&/. Bein"en"a"ed in said business, Petitioner re"istered itself with thePhilippine E!ono0i! :one 'uthority #PE:'$ as an e1portenterprise and was issued Certifi!ate of Re"istration No. 6+&// by the Philippine E!ono0i! :one 'uthority. Photo!opiesof Petitioner2s Certifi!ate of Re"istration #BIR >or0 &669$

and PE:' Certifi!ate of Re"istration are hereto atta!hed as'nne1es A'A and AB,A and 0ade as inte"ral parts hereof
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*. >or the period !overin" 'pril )& to 4une /), &3,petitioner "enerated and re!orded ;ero+rated e1port sales inthe a0ount of PhP(,6/3,)9,3*).&9, Philippine Curren!y

6. he above a0ount of P(,6/3,)9,3*).&9 was paid topetitioner in a!!eptable forei"n !urren!y and was inwardlyre0itted in a!!ordan!e with e1istin" re"ulations of theCentral Ban% of the Philippines pursuant to Se!. &)9#'$#($#a$#&$ of the a1 Code

9. >or the period !overin" 'pril )&, &3 to 4une /), &3,petitioner paid 8' input ta1es a0ountin" toPhP&&,--),&3&.-) for do0esti! pur!hases of "oods andservi!es whi!h were attributable to petitioner2s ;ero+ratedsales of PhP(,6/3,)9,3*).&9. Photo!opies of petitioner2s=uarterly 8' returns and 0onthly de!larations for these!ond ta1able =uarter of &3 whi!h was duly filed with theRespondent, and re!eived by Respondent2s !olle!tion a"ents,RCBC ateway Bran!h are hereto atta!hed as 'nne1 AC,AAD,A AEA and A>A for0in" as inte"ral parts hereof

-. he above 8' input ta1es were paid in !onne!tion withthe Petitioner2s trade or business and were duly supportedby invoi!es and?or re!eipts showin" the infor0ation re=uiredunder Se!tions &&/ and (/- of the a1 Code, and had notbeen applied a"ainst any 8' output ta1 liability of thePetitioner durin" the sa0e period fro0 'pril &, &3 to 4une/), &3, or any su!!eedin" period or periods

1 1 1 1

3. Bein" a 8'+re"istered entity, Petitioner is subFe!t to the

8alue+'dded a1 i0posed under itle I8 of the a1 Code.

1 1 1 1

. he e1port sales of the petitioner are not subFe!t to &)Gvalue+added ta1 but are ;ero+rated. Hen!e, su!h ;ero+rated


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sales will not result to any 8' output ta1 pursuant to Se!.&)9#'$#($#a$#&$ and Se!. &)3#B$#&$ of the a1 Code

&). Petitioner, for the period !overin" 'pril )&, &3 to 4une

/), &3, havin" "enerated ;ero+rated sales and paid 8'input ta1es in the !ourse of its trade or business, whi!h 8'input ta1es are attributable to the ;ero+rated sales and havenot been applied to any 8' output ta1 liability of thePetitioner for said period or any su!!eedin" =uarter or=uarters nor has been issued any ta1 !redit !ertifi!ate, itfollows that petitioner is entitled to the issuan!e of a ta1!redit !ertifi!ate for 8' input ta1es in the a0ount ofPhP&&,--),&3&.-) 1 1 1.

1 1 1 1

&&. On 7ay &3, &, petitioner in !o0plian!e with there=uisites provided for by law for the issuan!e of a ta1 !redit!ertifi!ate filed a !lai0 for ta1 !redit in the total a0ount ofPhP&&,--),&3&.-), with respondent throu"h the One StopShop Inter+'"en!y a1 Credit and Duty Drawba!% Center perBIR >or0 No. (66( entitled 'PP5IC'ION >OR 'JCREDI?RE>KND OR 8'5KE+'DDED 'J P'ID2 and Clai0antInfor0ation Sheet No. /6*&3. 1 1 1

&(. Respondent, however, despite su!h appli!ation for theissuan!e of a ta1 !redit !ertifi!ate above+0entioned and

notwithstandin" presentation of do!u0entary eviden!es insupport of su!h appli!ation, failed to "rant the ta1 !reditapplied for. 1 1 13

Petitioner prayed that, after due pro!eedin"s, Fud"0ent be

rendered in its favor, as follows@

LHERE>ORE, it is respe!tfully prayed that this Honorable Courtafter trial render Fud"0ent@

&. De!larin" Petitioner entitled to the issuan!e of ta1 !redit!ertifi!ate in the a0ount of PhP&&,--),&3&.-) representin"
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8' input ta1es paid by it durin" the period fro0 'pril )&,&3 to 4une /), &3, for whi!h no ta1 !redit !ertifi!atewas issued

(. Orderin" respondent to issue the ta1 !redit !ertifi!ate infavor of petitioner in the a0ount of PhP&&,--),&3&.-)referred to above and

/. rantin" petitioner su!h other reliefs as 0ay be Fust ande=uitable under the pre0ises.

he Co00issioner, as respondent, opposed the petition andprayed for its dis0issal. he followin" spe!ial and affir0ativedefenses were raised@

*. Petitioner, bein" alle"edly re"istered with the PhilippineE!ono0i! :one 'uthority, is e1e0pt fro0 all ta1es, in!ludin"value+added ta1, pursuant to Se!tion (* of Republi! '!t No.-&9, in relation to Se!tion &)/ of the a1 Code, asa0ended by R' --&9. Sin!e its sales are not ;ero+rated butare e1e0pt fro0 8', petitioner is not entitled to refund ofinput ta1 pursuant to Se!tion *.&)9+& and *.&)/+& ofRevenue Re"ulations No. -+6

6. Petitioner2s alle"ed !lai0 for refund is subFe!t toad0inistrative routinary investi"ation?e1a0ination by theBureau

9. he a0ount of P*-,63(,3&/.-( bein" !lai0ed bypetitioner as alle"ed 8' input ta1es for the period of )&4uly &- to /& De!e0ber &- was not properlydo!u0ented

-. In an a!tion for refund the burden of proof is on theta1payer to establish its ri"ht to refund, and failure tosustain the burden is fatal to the !lai0 for refund?!redit


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3. Petitioner 0ust show that it has !o0plied with theprovisions of Se!tions ()*#!$ and (( of the a1 Code onthe pres!riptive period for !lai0in" ta1 refund?!redit

. Clai0s for refund are !onstrued stri!tly a"ainst the!lai0ant for the sa0e parta%e the nature of e1e0ption fro0ta1ation.&)

he C' !o00issioned the servi!es of an independent auditor,Eliseo 'urellado, to !ondu!t an audit and evaluate petitioner2s!lai0. On 7ar!h ((, ())&, he sub0itted a Report to the C' withthe followin" !on!lusion@

In perfor0in" the above pro!edures, e1!ept for the net effe!t of

the Input 8' paid on its pur!hases as !o0pared to the results of0y review of supportin" do!u0ents, as shown in 'nne1 ABA noother 0atters !a0e to 0y attention that !ause 0e to believe thatthe atta!hed S!hedule of Input 8' Paid should be adFusted. Lebelieve that only the a0ounts of P,933,3)./ is a valid !lai0for ta1 !redit. his report relates only to the appli!ation of Intele!hnolo"y Philippines, In!. for ta1 !redit?refund spe!ified onpa"e & of this report and does not e1tend to the >inan!ialState0ents, ta%en as a whole, for any period where theafore0entioned ta1 refund is present.&&

'ppended thereto were the su00ary of pur!hases, state0ents ofinput 8' e1!eption, and state0ents of ;ero+rated e1port sales.&(

Petitioner addu!ed testi0onial eviden!e and offered the followin"do!u0ents in eviden!e@

EJHIBI DESCRIPION PKRPOSE

A'A' !opy of Petitioner2sCertifi!ate of Re"istration No. 6+&// issued by

o prove that Intele!hnolo"y Philippines,In!. is re"istered withPE:' as E!o;one E1port
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Philippine E!ono0i!:one 'uthority #PE:'$.his was already

subFe!t of stipulationof fa!ts.

Enterprise.

ABA' !opy of Petitioner2sBIR Certifi!ate ofRe"istration with RDOControl No. 9+6*)+)))-&/ issued on

4anuary /), &9 byRevenue Distri!t Offi!eNo. 6*.

his was alreadysubFe!t of stipulationof fa!ts.

o prove that Petitioner isduly re"istered with theBureau of InternalRevenue.

o prove that Petitioner isa duly re"istered 8'entity.

ACA M ADA

AC+&A MAD+&A

Copies of the 7onthly8' Returns for the0onth of 'pril and 7ayof &3. hese werealready subFe!ts ofstipulation of fa!ts.

Si"nature of Pablo 8.Pablo.

o prove that Petitionerfiled its 7onthly 8'De!laration for the 0onthof 'pril and 7ay of &3.

o prove that the 0onthly8' Returns was dulysi"ned by Petitioner2sauthori;ed a"ent.

AEAAE+&A Copies of Petitioner2s


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of &3.

Si"nature of Pablo 8.

Pablo

his was alreadysubFe!t to

stipulation of fa!ts

=uarter of &3.

o prove that Petitioner2s

authori;ed a"ent properlysi"ned the +*ABo1 No. &9B of the'0ended


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&3. =uarter of &3.

A>+6ABo1 No. &- of the'0ended


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hese were alreadysubFe!t of stipulationof fa!ts.

authori;ed representative.

AH+/,AAI+(,AA/A M A5+(A

Bo1 No. /* or /6 ofthe or0 No.(66( for the period'pril &, &3 to 4une

/), &3 filed with theOne+Stop+Shop Inter+'"en!y a1 Credit andDuty Drawba!% Centerof the Depart0ent of>inan!e duly sta0pedre!eived last )6+&3+.

Si"nature of Pablo 8.Pablo

hese were alreadysubFe!t of stipulationof fa!ts.

o prove that Petitionerfiled a !lai0 for refund ofinput ta1es in the totala0ount of P&&,--),&3&.-)with the One+Stop+ShopInter+'"en!y a1 Credit

and Duty Drawba!% Centerof the Depart0ent of>inan!e last )6+&3+.

o prove that the !lai0antinfor0ation sheet and BIRfor0 (66( were si"ned byPetitioner2s duly authori;edrepresentative.


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AOAAO+&AAO+(A

Certifi!ation of inwardre0ittan!e dated7ar!h )3, ())) issued

by CIIB'N

Si"nature of Pepper 7.5ope;, CitiServi!eOffi!er

'0ount of inwardre0ittan!e in thea0ount of

KS3,))),))).))

o prove that the pro!eedsof e1port sales of petitioner were properly

re0itted in KS dollars ina!!ordan!e with there"ulations of the Ban"%oSentral n" Pilipinas.

o prove that theCertifi!ation was properlysi"ned by Citiban%2sauthori;ed representative.

o prove the a0ount ofinward re0ittan!e in thea0ount of KS3,))),))).)).

APAAP+&AAP+(A

Certifi!ation of inwardre0ittan!e dated

7ar!h ), ())) issuedby RCBC

Si"nture of 7s. 'ra!eli8.

Dyo!o, Head E1portDept.

'0ount of inwardre0ittan!e in thea0ount of KS&)(,*,96.))

o prove that the pro!eedsof e1port sales of

petitioner were properlyre0itted in KS dollars ina!!ordan!e with there"ulations of the Ban"%oSentral n" Pilipinas.

o prove that theCertifi!ation was properlysi"ned by RCBC2s

authori;ed representative.

o prove the a0ount ofinward re0ittan!e in thea0ount of KS&)(,*,96.)).


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A


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AK+&A toAK+/-6,AA8+&A to8+996A

and AL+&A toAL+*(*A

Copies of Petitioner2ssupplier invoi!es andoffi!ial re!eipts for the

se!ond =uarter of&3.

o prove that the input 8'paid by Petitioner for these!ond =uarter of &3

e1!ept those withe1!eption are propertysupported with salesinvoi!es and offi!ialre!eipts.

AJA toAJ+99A

Copies of Petitioner2ssu00ary of e1port

sales, sales invoi!es,offi!ial re!eipts, airwaybills, e1portde!larations and!ertifi!ation of inwardre0ittan!es for these!ond =uarter of&3.

o prove that Petitioner forthe se!ond =uarter of &3"enerated e1port sales inthe total a0ountofP(,6/3,)9,3*).&9 andthe sa0e were dulysupported with do!u0ents.

AACopy of the su00arye1port sales !onsistin"of &/ pa"es atta!hedas 'nne1 ACA to theCertifi!ation 0ar%ed asE1hibit A


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addu!ed in eviden!e by petitioner !ould not be !onsidered as!o0petent eviden!e to prove its ;ero+rated sales of "oods for 8'purposes and for refund or issuan!e of a ta1 !redit !ertifi!atebe!ause no BIR authority to print said invoi!es was indi!ated

thereon. he C' also observed that so0e of the invoi!es do not!ontain the a1payer2s Identifi!ation Nu0ber+8' #IN+8$ ofpetitioner as re=uired in Se!tion &&/, in !onFun!tion with Se!tion(/-, of the a1 Code. he dispositive portion of the C' de!isionreads@

LHERE>ORE, in view of the fore"oin", petitioner2s !lai0 forissuan!e of a ta1 !redit !ertifi!ate in the a0ountofP&&,--),&3&.-) alle"edly representin" its 8' input ta1es on

do0esti! pur!hases of "oods and servi!es for the period 'pril &,&3 to 4une /), &3 is hereby DENIED.

SO ORDERED.&*

Petitioner filed a 7otion for Re!onsideration&6alle"in" that it wasable to prove its e1port sales by the followin" do!u0entaryeviden!e@

#&$ Certifi!ations of inward re0ittan!es 0ar%ed as E1hibits

AOA and APA for the Petitioner.

#($ 'irway bills.

#/$ E1port de!larations.

#*$ Certifi!ations of 7r. Eliseo 'urellado #E1hibit A


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he petitioner truly believes that althou"h the invoi!in"re=uire0ents pres!ribed under Se!tion &&/ #'$#&$, in relation toSe!tion (/- of the &- a1 Code, should be applied stri!tly inthe use of invoi!es or re!eipts for purposes of substantiatin" input

8' in!urred, the sa0e strin"ent appli!ation is not !alled forwhen the invoi!es or re!eipts are used for purposes ofsubstantiatin" a!tual e1port sales.

Lhile the invoi!es or re!eipts bein" used to substantiate !lai0 forinput 8' pertain to do0esti! sales, the invoi!es or re!eiptspresented by the petitioner, and whi!h were invalidated by thisHonorable Court pertain to e1port sales. here should be a0ar%ed differen!e be!ause in do0esti! sales, there results a

!orrespondin" input 8' whi!h 0ay be possibly !lai0ed by thepur!haser, whereas in e1port sales, su!h as those done by thepetitioner, the pur!haser in!urs no input 8' whi!h it 0ayeventually !lai0. hus, for purposes of substantiation in the !lai0for input 8' resultin" fro0 do0esti! sales the stern appli!ationof the 0entioned invoi!in" re=uire0ents is naturally de0anded.But for si0ple purposes of substantiatin" e1port sales, as in the!ase of petitioner, it should not be as e1a!tin" espe!ially!onsiderin" that the petitioner still has to substantiate its input

8', whi!h, this ti0e, needs to hurdle the aforesaid invoi!in"re=uire0ents under the &- a1 Code.

7oreover, unli%e in the substantiation of input 8', whi!h !an onlybe done throu"h the sub0ission of do0esti! sales invoi!es, thereare other do!u0ents to show the fa!t of e1port sales su!h ase1port de!larations, inward re0ittan!es and airway bills. his"ives 0ore plausible reason why invoi!es or re!eipts bein" usedto prove input 8' need to !o0ply with the invoi!e re=uire0ents

set forth under Se!tion &&/#'$#&$, in relation to Se!tion (/-, ofthe &- a1 Code.&-

Petitioner appended thereto a letter+authority dated 'pril &-,&- si"ned by BIR Re"ional Dire!tor Sol Hubahib of Re"ion No. approvin" its re=uest to use !o0puteri;ed sales invoi!es.


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On Septe0ber &, ())/, the C' denied petitioner2s 7otion forRe!onsideration and Supple0ental 7otion for Re!onsideration.

'""rieved, petitioner filed before the C' a petition for review of

the ta1 !ourt2s de!ision. Petitioner averred that, under Se!tions&&/#'$#&$ and (/- of the &- a1 Code, the followin"infor0ation is re=uired to be indi!ated in the invoi!e or re!eipt@#&$ a state0ent that the seller is 8'+re"istered #($ the seller2sIN and #/$ the na0e, business style, if any, and address of thepur!haser, !usto0er or !lient. However, petitioner averred, su!hre=uire0ents apply only to do0esti! or lo!al sales, !onsiderin"that the output ta1 #the input ta1 on the part of the lo!alpur!haser$, 0ay be !lai0ed by the latter as a !redit a"ainst its

output 8'. hus, a!!ordin" to petitioner, the invoi!es or re!eiptsbein" issued by the lo!al seller are re=uired to indi!ate theinfor0ation listed under the afore0entioned provisions of the a1Code so that the lo!al pur!haser would have a valid basis in its!lai0 for the !reditin" of the input 8'. On the other hand, su!hre=uire0ents do not apply to its e1port sales, sin!e no input 8'0ay be !lai0ed thereon. Petitioner further pointed out that thetransa!tion is subFe!t to )G rate there is no input 8' to be!lai0ed by its forei"n pur!haser and the latter is not a 8'+

re"istered entity in the Philippines. Considerin" that norefundable or !reditable input 8' results fro0 its e1port salestransa!tions, it should not be subFe!ted to stri!t !o0plian!e withthe invoi!in" re=uire0ents.

Petitioner also !lai0ed that the absen!e of BIR authority to printits IN+8 in so0e of the invoi!es is not fatal to its !lai0 for refundor issuan!e of a ta1 !redit !ertifi!ate as to invalidate thedo!u0ents used to prove its e1port sales. It de!lared that it used

!o0puteri;ed a!!ountin" for0s as sales invoi!es in its e1portsales based on the letter+authority dated 'pril &-, &- of theBIR. It was only throu"h plain 0ista%e and inadverten!e that thesales invoi!es it used had no authority to print. Su!h o0issionshould not alle"edly render the said sales invoi!es alto"etherinvalid or inad0issible for purposes of substantiatin" petitioner2sa!tual e1port sales !overin" the period 'pril &, &3 to 4une /),


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&3. Petitioner opined that its failure to addu!e in eviden!e thesaid letter+authority of the BIR was due to its honest belief that ithad already addu!ed suffi!ient eviden!e to prove its a!tual e1portsales.

Petitioner sub0itted that while the C' ruled that the invoi!eswhi!h did not indi!ate IN+8 were not suffi!ient proof of its e1portsales, this !onstituted only a s0all part of the hundreds ofinvoi!es it had sub0itted. hese defe!tive invoi!es, therefore,relate to a s0all !hun% of the e1port sales it 0ade for the!overed period. If at all, the invalid invoi!es !ould only 0ean thatonly a s0all part of its !lai0 was bein" disallowed, not the entire!lai0.

On 'u"ust &(, ())*, the C' rendered its De!ision&3affir0in" theC' rulin". he C' ruled that while under Se!tion &)9#'$#($#a$#&$ of the a1 Code, 8'+re"istered entities are entitled to !lai08' refund on their input ta1es if their e1port sales are ;ero+rated, the !lai0 is nevertheless subFe!t to the invoi!in" anda!!ountin" re=uire0ents of 8'+re"istered persons under Se!tion&&/ in relation to Se!tion (/- of the a1 Code. It is therefore!lear, the appellate !ourt !on!luded, that what should be provenare not only the e1port sales but also !o0plian!e with there=uire0ents under the aforesaid se!tions of the a1 Code.&

he C' further ruled that Revenue Re"ulations #RR$ No. -+6re=uires 8'+re"istered persons to issue duly re"istered re!eipts,and enu0erates the entries that should be !ontained in the saidduly re"istered re!eipts. Se!tion (/- of the a1 Code further0andates that persons re=uired to issue re!eipts or invoi!esshould re"ister these do!u0ents with the BIR. In fa!t, RR No. (+) restored the re=uire0ent to re"ister and sta0p re!eipts andinvoi!es prior to their use.()hus, 8'+re"istered persons aredire!ted to issue duly re"istered invoi!es for every sale or lease of

"oods, properties or servi!es, !ontainin" the re=uired infor0ationunder the law.(&
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'!!ordin" to the C', sin!e petitioner issued invoi!es with theBIR2s authority to print, it 0ust be !on!luded that these invoi!eswere not re"istered as they did not !o0ply with the invoi!in"re=uire0ents under Se!tion &&/, and the re=uire0ents for

issuan!e of re!eipts or sales or !o00er!ial invoi!es under Se!tion(/-. he C' de!lared that an unre"istered re!eipt !ould not beused as supportin" do!u0ent for input ta1.((It further e1plainedthat Revenue 7e0orandu0 Cir!ular #R7C$ No. *(+())/ already!larified that failure to !o0ply with invoi!in" re=uire0ents wouldresult in the disallowan!e of the !lai0 for input ta1 by thepur!haser+!lai0ant. Hen!e, the C' ruled, if the !lai0 for refundor issuan!e of a ta1 !redit !ertifi!ate is based on the ta1payer2s;ero+rated sales, but the invoi!in" re=uire0ents in the issuan!e of

sales invoi!es are not !o0plied with, the !lai0 for ta1!redit?refund of 8' on its pur!hases shall be denied. his isbe!ause the invoi!es issued to its !usto0ers failed to depi!t thatthe ta1payer is 8'+re"istered and that its sales are !lassified as;ero+rated. '!!ordin" to the appellate !ourt, however, thistreat0ent is without preFudi!e to the ri"ht of the ta1payer to!har"e the input ta1es to the appropriate e1pense a!!ount orasset a!!ount subFe!t to depre!iation, whi!hever is appli!able.(/

he C' further de!lared that petitioner failed to establish that its!o0puter+"enerated sales invoi!es were duly sta0ped with theapproval of the BIR as shown by the letter+authority dated 'pril&-, &-, !onsiderin" that the said letter+authority was notpresented durin" the trial of the !ase, 0u!h less atta!hed to thepetition filed before it.(*he fallo of the C' de!ision reads@

LHERE>ORE, in view of the fore"oin", the instant petition isDENIED. he De!ision of the Court of a1 'ppeals in C' Case

No. 9&(3 is hereby '>>IR7ED. No pronoun!e0ent as to !osts.

SO ORDERED.(6

Kndaunted by the adverse rulin" of the appellate !ourt, petitionernow see%s re!ourse to this Court on the followin" "rounds@


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I.

HE DECISION O> HE COKR O> 'PPE'5S '>>IR7IN HEDENI'5 O> PEIIONER2S C5'I7 >OR 'J CREDI?RE>KND IS

CONR'R O PRO8ISIONS O> HE 'J CODE 'ND 'PP5IC'B5EREK5'IONS 'ND DECISIONS O> HE HONOR'B5E SKPRE7ECOKR.

II.

SECIONS &&/ 'ND (/- O> HE 'J CODE DO NO RE5EC IS 'KHORI O PRIN IN ISIN8OICES. PEIIONER IS NO RE'I5KRE PEN'5I:ED B 'N 5'L ORS'KE SKCH H' HE IN8OICES 'RE RENDEREDIN'D7ISSIB5E.

III.

HE >'I5KRE O S'E HE IN+8 IN PEIIONER2S EJPORS'5ES IN8OICES SHOK5D NO IN8'5ID'E PEIIONER2SC5'I7. PEIIONER2S EJPOR S'5ES IN8OICES, LHICH 'RE

'D7ISSIB5E, CO7PEEN 'ND 7'ERI'5 E8IDENCE,SK>>ICIEN5 PRO8E PEIIONER2S EJPOR S'5ES.(9

he Issues

he issues to be resolved in the instant !ase are #&$ whether theabsen!e of the BIR authority to print or the absen!e of the IN+8in petitioner2s e1port sales invoi!es operates to forfeit itsentitle0ent to a ta1 refund?!redit of its unutili;ed input 8'

attributable to its ;ero+rated sales and #($ whether petitioner2sfailure to indi!ate AIN+8A in its sales invoi!es auto0ati!allyinvalidates its !lai0 for a ta1 !redit !ertifi!ation.

Petitioner2s 'r"u0ents


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Petitioner !ontends that Se!tions &&/ and (/- of the a1 Code,and even RR -+6, do not re=uire the ta1payer to refle!t itsauthority to print in its invoi!es.(->ailure to print su!h authority isnot even penali;ed by any law or statute su!h that the invoi!es

whi!h do not !ontain the BIR authority for petitioner to print itssales are rendered inad0issible in eviden!e.(3>urther, theauthority to print under Se!tion (/3 of the a1 Code is are=uire0ent that is separate fro0 and independent of theinfor0ation that ou"ht to be refle!ted in the invoi!e or offi!ialre!eipt as 0andated by Se!tion &&/, in relation to Se!tion (/- ofthe a1 Code.(he BIR has even ruled, in BIR Rulin" D'+/-6+)/,that re!eipts whi!h do not refle!t that the ta1payer is 8'+re"istered do not auto0ati!ally invalidate the !lai0 for an input

ta1 !redit./)

7oreover, RR (+) #whi!h the appellate !ourt !ited inthe assailed de!ision$ does not state that failure to refle!t theauthority to print on the fa!e of a sales invoi!e or re!eipt resultsin the outri"ht invalidation of su!h sales invoi!e or of the !lai0 forta1 !redit?refund./&It insists that R7C No. *(+)/, whi!h the C'li%ewise relied on in the assailed de!ision, does not apply, for itrelates to non+!o0plian!e with invoi!in" re=uire0ents theauthority to print is not a0on" the infor0ation re=uired by law orany re"ulation to be refle!ted in petitioner2s invoi!es./(

Petitioner asserts that even if it were assu0ed for the sa%e ofar"u0ent that the BIR has issued a re"ulation to the effe!t thatfailure to indi!ate the authority to print on the fa!e of a salesinvoi!e would render it invalid, su!h re"ulation !annot prevailover the law that it see%s to i0ple0ent. It insists that anyadditional re=uire0ent i0posed by the BIR for a valid !lai0 otherthan those 0andated by law is invalid,//and that the provisionsof a ta1in" a!t are not to be e1tended by i0pli!ation./*

>urther, petitioner !ontends that it was authori;ed by the BIR touse a !o0puteri;ed a!!ountin" syste0/6throu"h the letter+authority dated 'pril &-, &-./9It avers that even if the letter+authority was not offered in eviden!e, the Court ou"ht to ta%eFudi!ial noti!e thereof as an offi!ial a!t of the E1e!utiveBran!h./-Petitioner asserts that sin!e its e1port sales invoi!es
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were !o0puter+"enerated under an approved !o0puteri;eda!!ountin" syste0, it is no lon"er 0andated to !o0ply with there=uire0ents under Se!tion & of RR No. (+) on theauthenti!ation and re"istration of boo%s, re"isters or re!ords,

authority to print re!eipts, sales or !o00er!ial invoi!es andre"istration and sta0pin" of re!eipts and invoi!es. Su!hre=uire0ents apply only to 0anually "enerated re!eipts andinvoi!es. Even "rantin" ar"uendo that it was still re=uired by RRNo. -+6 to indi!ate its authority to print in its invoi!es, it was not0andated to obtain an authority to print as the burden ofse!urin" the sa0e falls upon the printer of the re!eipts./3

Petitioner further !ontends that the invoi!in" re=uire0ent of

statin" the IN+8 applies only to do0esti! or lo!al sales, "iventhat the output ta1 #the input ta1 on the part of the lo!alpur!haser$, 0ay be !lai0ed by the latter as a !redit a"ainst itsoutput 8'. In su!h a !ase, the invoi!in" re=uire0ents should be!o0plied with in order for the lo!al pur!haser to have a validbasis in its !lai0 for !reditin" of input 8'. his, however, doesnot apply in the instant !ase for the followin" reasons@petitioner2s e1port sales with its forei"n pur!haser is subFe!t to;ero+rated 8' its forei"n pur!haser !annot !lai0 input 8' as it

is "overned by a forei"n ta1in" Furisdi!tion and the latter is not a8'+re"istered entity in the Philippines./o buttress its !lai0,petitioner !ites the de!ision of the C' in Intel e!hnolo"yPhilippines, In!. v. CIR.*)

In any !ase, petitioner ar"ues, it suffi!iently proved its e1portsales sin!e, other than the subFe!t invoi!es, it also sub0itted ineviden!e the followin"@ !ertifi!ations of inward re0ittan!esairway bills e1port de!larations !ertifi!ation by Eliseo 'urellado,

the independent CP' duly !o00issioned by the ta1 !ourt,attestin" that petitioner 0ade e1port sales of P(,6/3,)9,3*).&9durin" the se!ond =uarter of &3.

Petitioner pleads that its appli!ation for ta1 !redit?refund shouldbe "ranted to serve the hi"her interest of Fusti!e, e=uity andfairness, and !lai0s that te!hni!alities should "ive way to its


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substantive ri"hts.*&Lhile it 0ay be true that ta1es are thelifeblood of the "overn0ent, te!hni!alities and le"alis0s, howevere1alted, should not be 0isused by the "overn0ent to %eep0oney not belon"in" to it and thereby enri!h itself at the

e1pense of its law+abidin" !iti;ens.

he Respondent2s Counter+'r"u0ents

>or his part, respondent Co00issioner, throu"h the Offi!e of theSoli!itor eneral, 0aintains that the absen!e of the BIR authorityto print and the IN+8 in its e1port sales invoi!es is fatal topetitioner2s !lai0 for refund.*(Se!tion &&/ of the a1 Codeenu0erates the invoi!in" re=uire0ents for 8'+re"isteredpersons, whi!h in!lude, a0on" others, a state0ent that the selleris 8'+re"istered and the seller2s IN.*/Se!tion (/- of the sa0eCode, and Se!tion *.&)3.& of RR No. -+6, further re=uire theissuan!e of duly re"istered re!eipts or invoi!es for every sale ortransa!tion, indi!atin" thereon the pur!haser2s IN.**

' 8'+re"istered person is, therefore, re=uired to issue a re!eiptor invoi!e with a IN for every !onsu00ated sale, and whi!h,followin" Se!tion & of RR No. (+),*60ust be duly re"isteredwith the BIR as eviden!ed by a sta0p of the ta1payer2s authorityto print.*9Respondent stresses that Se!tion (/3 of the a1 Code0andates all persons en"a"ed in business to se!ure an authorityto print re!eipts or invoi!es fro0 the BIR.*-here is an additionalre=uire0ent that su!h authority to print 0ust be sta0ped onevery re!eipt or invoi!e of a 8'+re"istered person. Lhile it is note1pli!itly enu0erated in Se!tions &&/ and (/- of the a1 Code asone of the invoi!in" re=uire0ents, it !an be i0plied fro0 saidprovisions that su!h infor0ation 0ust be refle!ted on the re!eiptor invoi!e, as the sta0pin" of the said BIR authority to print is aproof of the invoi!e bein" BIR+re"istered.*3'bsent the saidauthority to print, therefore, petitioner2s invoi!es are !onsidered

unre"istered, and thus !annot be used as supportin" do!u0entsto prove its input ta1 and eventually, its !lai0 for ta1 refund.*
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Respondent Co00issioner further e0phasi;es that ta1 refunds?!redits are in the nature of ta1 e1e0ptions hen!e, laws relatin"to the0 !all for a stri!t appli!ation a"ainst the !lai0ant.6)heburden to prove the entitle0ent to the refund also rests on the

ta1payer, whi!h, in this !ase, was not proven bypetitioner.6&7oreover, petitioner2s ar"u0ent, that it wasauthori;ed by the BIR to use a !o0puteri;ed a!!ountin" syste0and as su!h is no lon"er re=uired to se!ure an authority to print,has no le" to stand on be!ause the 'pril &-, &- letter+authority6(fro0 the BIR was not for0ally offered in eviden!e.6/Itinsists that sin!e the letter+authority is a 0ere !orresponden!e!ontainin" 0atters that are not of publi! %nowled"e and in!apableof un=uestionable de0onstration, the Court !annot ta%e Fudi!ial

noti!e thereof.6*

'nd even if petitioner was authori;ed to use!o0puteri;ed invoi!es, it was not e1!used fro0 !o0plyin" withthe sta0pin" and invoi!in" re=uire0ents.66

5astly, respondent !ontends that it is in!orre!t for petitioner tostate that the invoi!in" re=uire0ent under the a1 Code findsrelevan!e only in do0esti! or lo!al sales. he provisions of thelaw and the BIR re"ulations on invoi!in" do not distin"uishwhether the transa!tion is an e1port or lo!al sale.69

he Court2s Rulin"

he petition is partially "ranted.

Sin!e the issues are interrelated, the Court shall delve into andresolve the0 si0ultaneously.

he pertinent provision of the a1 Code on 8' on the sale of"oods or properties, parti!ularly with respe!t to e1port sales, is

Se!tion &)9#'$#($#a$#&$.6-he provision reads@

Se!tion &)9. 8alue+added a1 on Sale of oods or Properties.

#'$ Rate and Base of a1.++ 111

1 1 1 1
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#($ he followin" sales by 8'+re"istered persons shall be subFe!tto ;ero per!ent #)G$ rate@

#a$ E1port Sales.++he ter0 e1port sales2 0eans@

#&$ he sale and a!tual ship0ent of "oods fro0 the Philippines toa forei"n !ountry, irrespe!tive of any shippin" arran"e0ent that0ay be a"reed upon whi!h 0ay influen!e or deter0ine thetransfer of ownership of the "oods so e1ported and paid for ina!!eptable forei"n !urren!y or its e=uivalent in "oods or servi!es,and a!!ounted for in a!!ordan!e with the rules and re"ulations ofthe Ban"%o Sentral n" Pilipinas #BSP$.

Based on the above provision, e1port sales, or sales outside the

Philippines, are subFe!t to 8' at )G rate if 0ade by a 8'+re"istered person.63Lhen applied to the ta1 base, the )G rateobviously results in no ta1 !har"eable a"ainst the pur!haser. heseller of su!h transa!tions !har"es no output ta1, but !an !lai0 arefund or ta1 !redit !ertifi!ate for the 8' previously !har"ed bysuppliers.6

In the instant !ase, petitioner, as a 8'+re"istered as well asPE:'+re"istered entity en"a"ed in the e1port of advan!ed and

lar"e+s!ale ICs, is !lai0in" a refund or issuan!e of a ta1 !redit!ertifi!ate in the a0ount ofP&&,--),&3&.-) for 8' input ta1es itpaid on its do0esti! pur!hases of "oods and servi!es !overin" theperiod 'pril &, &3 to 4une /), &3. >or petitioner #or other

8'+re"istered persons or entities whose sales are ;ero+rated oreffe!tively ;ero+rated$ to validly !lai0 a refund or ta1 !redit,Se!tion &&(#'$ of the a1 Code provides@

Se!tion &&(. Refunds or a1 Credits of Input a1.+

#'$ :ero+rated or Effe!tively :ero+rated Sales. + 'ny 8'+re"istered person, whose sales are ;ero+rated or effe!tively ;ero+rated 0ay within two #($ years after the !lose of the ta1able=uarter when the sales were 0ade, apply for the issuan!e of ata1 !redit !ertifi!ate or refund of !reditable input ta1 due or paidattributable to su!h sales, e1!ept transitional input ta1, to the
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e1tent that su!h input ta1 has not been applied a"ainst outputta1@ Provided, however, hat in the !ase of ;ero+rated sales underSe!tion &)9#'$#($#a$#&$, #($ and #B$ and Se!tion &)3 #B$#&$ and#($, the a!!eptable forei"n !urren!y e1!han"e pro!eeds thereof

had been duly a!!ounted for in a!!ordan!e with the rules andre"ulations of the Ban"%o Sentral n" Pilipinas #BSP$@ Provided,further, hat where the ta1payer is en"a"ed in ;ero+rated oreffe!tively ;ero+rated sale and also in ta1able or e1e0pt sale of"oods or properties or servi!es, and the a0ount of !reditableinput ta1 due or paid !annot be dire!tly and entirely attributed toany one of the transa!tions, it shall be allo!ated proportionatelyon the basis of the volu0e of sales.9)

Knder Se!tions &)9 #'$#($#a$#&$ in relation to &&(#'$ of the a1Code, a ta1payer en"a"ed in ;ero+rated or effe!tively ;ero+ratedtransa!tions 0ay apply for a refund or issuan!e of a ta1 !redit!ertifi!ate for input ta1es paid attributable to su!h sales upon!o0plyin" with the followin" re=uisites@ #&$ the ta1payer isen"a"ed in sales whi!h are ;ero+rated #li%e e1port sales$ oreffe!tively ;ero+rated #($ the ta1payer is 8'+re"istered #/$ the!lai0 0ust be filed within two years after the !lose of the ta1able=uarter when su!h sales were 0ade #*$ the !reditable input ta1

due or paid 0ust be attributable to su!h sales, e1!ept thetransitional input ta1, to the e1tent that su!h input ta1 has notbeen applied a"ainst the output ta1 and #6$ in !ase of ;ero+ratedsales under Se!tion &)9#'$#($#a$#&$ and #($, Se!tion &)9#B$, andSe!tion &)3#B$#&$ and #($, the a!!eptable forei"n !urren!ye1!han"e pro!eeds thereof had been duly a!!ounted for ina!!ordan!e with BSP rules and re"ulations. It is added that,Awhere the ta1payer is en"a"ed in ;ero+rated or effe!tively ;ero+rated sale and also in ta1able or e1e0pt sale of "oods or

properties or servi!es, and the a0ount of !reditable input ta1 dueor paid !annot be dire!tly or entirely attributed to any one of thetransa!tions, it shall be allo!ated proportionately on the basis ofthe volu0e of the sales.A

In this !onne!tion, petitioner, in order to prove that it wasen"a"ed in e1port sales durin" the se!ond =uarter of &3,


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offered in eviden!e !opies of su00ary of e1port sales, salesinvoi!es, offi!ial re!eipts, airway bills, e1port de!larations and!ertifi!ation of inward re0ittan!es durin" the said period.9&Inaddition, petitioner2s Certifi!ate of Re"istration with RDO Control

No. 9+6*)+)))-&/9(

issued by the BIR and Certifi!ate ofRe"istration No. 6+&//9/issued by the PE:' were li%ewise offeredin eviden!e to prove that it is a 8'+re"istered entity as well asan E!o;one e1port enterprise.

o the 0ind of the Court, these do!u0entary eviden!e sub0ittedby petitioner, e."., su00ary of e1port sales, sales invoi!es,offi!ial re!eipts, airway bills and e1port de!larations, prove that itis en"a"ed in the Asale and a!tual ship0ent of "oods fro0 the

Philippines to a forei"n !ountry.A In short, petitioner is !onsidereden"a"ed in e1port sales #a ;ero+rated transa!tion$ if 0ade by a8'+re"istered entity. 7oreover, the !ertifi!ation of inwardre0ittan!es attests to the fa!t of pay0ent Ain a!!eptable forei"n!urren!y or its e=uivalent in "oods or servi!es, and a!!ounted forin a!!ordan!e with the rules and re"ulations of the BSP.A hus,petitioner2s eviden!e, Fu1taposed with the re=uire0ents ofSe!tions &)9 #'$#($#a$#&$ and &&(#'$ of the a1 Code, asenu0erated earlier, suffi!iently establish that it is entitled to a

!lai0 for refund or issuan!e of a ta1 !redit !ertifi!ate for!reditable input ta1es.

Si"nifi!antly, the C' and the C' have si0ilarly found petitionerto be le"ally entitled to a !lai0 for refund or issuan!e of ta1 !redit!ertifi!ate of its unutili;ed 8' input ta1es on do0esti! pur!hasesof "oods and servi!es attributable to its ;ero+rated sales. heydenied petitioner2s !lai0, however, on the "round that itpurportedly failed to !o0ply with the invoi!in" re=uire0ents

under Se!tions &&/ and (/- of the a1 Code sin!e its salesinvoi!es do not bear the BIR authority to print, and several of theinvoi!es do not indi!ate the IN+8.

On the latter point, the Court disa"rees with the C' and C'. 's!orre!tly ar"ued by petitioner, there is no law or BIR rule orre"ulation re=uirin" petitioner2s authority fro0 the BIR to print its


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sales invoi!es #BIR authority to print$ to be refle!ted or indi!atedtherein. Se!tions &&/, (/- and (/3 of the a1 Code provide@

Se!. &&/. Invoi!in" and '!!ountin" Re=uire0ents for 8'+

Re"istered Persons.

#'$ Invoi!in" Re=uire0ents. ' 8'+re"istered person shall,for every sale, issue an invoi!e or re!eipt. In addition to theinfor0ation re=uired under Se!tion (/-, the followin"infor0ation shall be indi!ated in the invoi!e or re!eipt@

#&$ ' state0ent that the seller is a 8'+re"isteredperson, followed by his ta1payer2s identifi!ationnu0ber and

#($ he total a0ount whi!h the pur!haser pays or isobli"ated to pay to the seller with the indi!ation thatsu!h a0ount in!ludes the value+added ta1.

#B$ '!!ountin" Re=uire0ents. Notwithstandin" the

provisions of Se!tion (//, all persons subFe!t to the value+added ta1 under Se!tions &)9 and &)3 shall, in addition tothe re"ular a!!ountin" re!ords re=uired, 0aintain a

subsidiary sales Fournal and subsidiary pur!hase Fournal onwhi!h the daily sales and pur!hases are re!orded. hesubsidiary Fournals shall !ontain su!h infor0ation as 0ay bere=uired by the Se!retary of >inan!e.9*#e0phasis supplied$

Se!. (/-. Issuan!e of Re!eipts or Sales or Co00er!ial Invoi!es. 'll persons subFe!t to an internal revenue ta1 shall, for ea!h saleor transfer of 0er!handise or for servi!es rendered valued atwenty+five pesos #P(6.))$ or 0ore, issue duly re"istered

re!eipts or sales or !o00er!ial invoi!es, prepared at least indupli!ate, showin" the date of transa!tion, =uantity, unit !ost anddes!ription of 0er!handise or nature of servi!e@ Provided,however, hat in the !ase of sales, re!eipts or transfers in thea0ount of One Hundred Pesos #P&)).))$ or 0ore, or re"ardlessof a0ount, where the sale or transfer is 0ade by a person liableto value+added ta1 to another person also liable to value+added


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ta1 or where the re!eipt is issued to !over pay0ent 0ade asrentals, !o00issions, !o0pensations or fees, re!eipts or invoi!esshall be issued whi!h shall show the na0e, business style, if any,and address of the pur!haser, !usto0er or !lient Provided,

further, hat where the pur!haser is a 8'+re"istered person, inaddition to the infor0ation herein re=uired, the invoi!e or re!eiptshall further show the a1payer Identifi!ation Nu0ber #IN$ ofthe pur!haser.

he ori"inal of ea!h re!eipt or invoi!e shall be issued to thepur!haser, !usto0er or !lient at the ti0e the transa!tion iseffe!ted, who, if en"a"ed in business or in the e1er!ise ofprofession, shall %eep and preserve the sa0e in his pla!e of

business for a period of three #/$ years fro0 the !lose of theta1able year in whi!h su!h invoi!e or re!eipt was issued, whilethe dupli!ate shall be %ept and preserved by the issuer, also in hispla!e of business, for a li%e period.

he Co00issioner 0ay, in 0eritorious !ases, e1e0pt any personsubFe!t to an internal revenue ta1 fro0 !o0plian!e with theprovisions of this Se!tion.96#e0phasis supplied$

Se!. (/3. Printin" of Re!eipts or Sales or Co00er!ial Invoi!es. 'll persons who are en"a"ed in business shall se!ure fro0 theBureau of Internal Revenue an authority to print re!eipts or salesor !o00er!ial invoi!es before a printer !an print the sa0e.

No authority to print re!eipts or sales or !o00er!ial invoi!es shallbe "ranted unless the re!eipts or invoi!es to be printed areserially nu0bered and shall show, a0on" other thin"s, the na0e,business style, a1payer Identifi!ation Nu0ber #IN$ andbusiness address of the person or entity to use the sa0e, and

su!h other infor0ation that 0ay be re=uired by rules andre"ulations to be pro0ul"ated by the Se!retary of >inan!e, uponre!o00endation of the Co00issioner.

'll persons who print re!eipt or sales or !o00er!ial invoi!es shall0aintain a lo"boo%?re"ister of ta1payer who availed of their


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printin" servi!es. he lo"boo%?re"ister shall !ontain the followin"infor0ation@

#&$ Na0es, a1payer Identifi!ation Nu0bers of the persons

or entities for who0 the re!eipts or sales or !o00er!ialinvoi!es are printed and

#($ Nu0ber of boo%lets, nu0ber of sets per boo%let, nu0berof !opies per set and the serial nu0bers of the re!eipts orinvoi!es in ea!h boo%let. #e0phasis supplied$

RR (+), as !ited by respondent Co00issioner, also states in itsSe!tion d$ that@

Se!tion &. 'uthenti!ation and re"istration of boo%s, re"ister, orre!ords authority to print re!eipts, sales or !o00er!ial invoi!esand re"istration and sta0pin" of re!eipts and invoi!es.

1 1 1 1

#d$ Re"istration and sta0pin" of re!eipts and invoi!es

Before bein" used, the printed re!eipts, sales or !o00er!ial

invoi!es shall be re"istered with the revenue distri!t offi!er wherethe prin!ipal pla!e of business of the ta1payer is lo!ated withinthirty #/)$ days fro0 the date of printin" the sa0e. here"istration of the printed re!eipts or invoi!es shall be eviden!edby an appropriate sta0p on the fa!e of the ta1payer2s !opy of theauthority to print as well as on the front !over, on the ba!% of the0iddle invoi!e or re!eipt and on the ba!% of the last invoi!e orre!eipt of the re"istered boo%let or pad, authenti!ated by thesi"nature of the offi!er authori;ed to pla!e the sta0p thereon.

#e0phasis supplied$

RR -+6, the Consolidated 8' Re"ulations, also states in Se!tion*.&)3+& that@

Se!tion *.&)3+&. Invoi!in" Re=uire0ents. 'll 8'+re"isteredpersons shall, for every sale or lease of "oods or properties or


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servi!es, issue duly re"istered re!eipts or sales or !o00er!ialinvoi!es whi!h 0ust show@

&. the na0e, IN and address of seller

(. date of transa!tion

/. =uantity, unit !ost and des!ription of 0er!handise ornature of servi!e

*. the na0e, IN, business style, if any, and address of the8'+re"istered pur!haser, !usto0er or !lient

6. the word A;ero+ratedA i0printed on the invoi!e !overin"

;ero+rated sales and

9. the invoi!e value or !onsideration.

In the !ase of sale of real property subFe!t to 8' and where the;onal or 0ar%et value is hi"her than the a!tual !onsideration, the8' shall be separately indi!ated in the invoi!e or re!eipt.

Only 8'+re"istered persons are re=uired to print their INfollowed by the word A8'A in their invoi!es or re!eipts and thisshall be !onsidered as a A8'+invoi!e.A 'll pur!hases !overed byinvoi!es other than A8' Invoi!eA shall not "ive rise to any inputta1.

If the ta1able person is also en"a"ed in e1e0pt operations, heshould issue separate invoi!es or re!eipts for the ta1able ande1e0pt operations. ' A8'+invoi!eA shall be issued only for salesof "oods, properties or servi!es subFe!t to 8' i0posed inSe!tions &)) and &)( of the Code.

he invoi!e or re!eipt shall be prepared at least in dupli!ate, theori"inal to be "iven to the buyer and the dupli!ate to be retainedby the seller as part of his a!!ountin" re!ords.


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It is !lear fro0 the fore"oin" that while entities en"a"ed inbusiness are re=uired to se!ure fro0 the BIR an authority to printre!eipts or invoi!es and to issue duly re"istered re!eipts orinvoi!es, it is not re=uired that the BIR authority to print be

refle!ted or indi!ated therein. Only the followin" ite0s arere=uired to be indi!ated in the re!eipts or invoi!es@ #&$ astate0ent that the seller is a 8'+re"istered entity followed by itsIN+8 #($ the total a0ount whi!h the pur!haser pays or isobli"ated to pay to the seller with the indi!ation that su!h a0ountin!ludes the value+added ta1 #/$ date of the transa!tion #*$=uantity of 0er!handise #6$ unit !ost #9$ des!ription of0er!handise or nature of servi!e #-$ the na0e, business style, ifany, and address of the pur!haser, !usto0er or !lient in the !ase

of sales, re!eipt or transfers in the a0ount of P&)).)) or 0ore,or re"ardless of the a0ount, where the sale or transfer is 0adeby a person liable to 8' to another person also liable to 8', orwhere the re!eipt is issued to !over pay0ent 0ade as rentals,!o00issions, !o0pensations or fees and #3$ the IN of thepur!haser where the pur!haser is a 8'+re"istered person.

It should be noted that petitioner is en"a"ed in e1port sales, su!hthat the pur!hasers of its "oods are forei"n entities, whi!h are,

lo"i!ally, not 8'+re"istered in our !ountry or liable to pay 8' inour Furisdi!tion. Ite0s #-$ and #3$ in the above enu0eration donot, thus, apply to petitioner that is, they need not be refle!tedor indi!ated in the invoi!es or re!eipts, "iven that it is an entityen"a"ed in e1port sales, and the pur!hasers of its "oods whi!hare forei"n entities are not 8'+re"istered in our !ountry norliable to pay 8' in our Furisdi!tion.

In any !ase, the above !ited provisions of law and revenue

re"ulations do not provide that failure to refle!t or indi!ate in theinvoi!es or re!eipts the BIR authority to print, as well as the IN+8, would result in the outri"ht invalidation of these invoi!es orre!eipts. Neither is it provided therein that su!h o0ission orfailure would result in the outri"ht denial of a !lai0 for ta1!redit?refund. Instead, Se!tion (9* of the a1 Code i0poses thepenalty of fine and i0prison0ent for, a0on" others, invoi!es or


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re!eipts that do not truly refle!t or !ontain all the re=uiredinfor0ation, to wit@

Se!tion (9*. >ailure or Refusal to Issue Re!eipts or Sales or

Co00er!ial Invoi!es, 8iolations Related to the Printin" of su!hRe!eipts or Invoi!es or Other 8iolations.

#a$ 'ny person who, bein" re=uired under Se!tion (/- toissue re!eipts or sales or !o00er!ial invoi!es, fails orrefuses to issue su!h re!eipts or invoi!es, issues re!eipts orinvoi!es that do not truly refle!t and?or !ontain all theinfor0ations re=uired to be shown therein or uses 0ultipleor double re!eipts or invoi!es, shall, upon !onvi!tion for ea!ha!t or o0ission, be punished by a fine of not less than Onethousand pesos #P&,)))$ but not 0ore than >ifty thousandpesos #P6),)))$ and suffer i0prison0ent of not less thantwo #($ years but not 0ore than four #*$ years.

#b$ 'ny person who !o00its any of the a!ts enu0eratedhereunder shall be penali;ed in the sa0e 0anner and to thesa0e e1tent as provided for in this Se!tion@

#&$ Printin" of re!eipts or sales or !o00er!ial invoi!es

without authority fro0 the Bureau of Internal Revenueor

#($ Printin" of double or 0ultiple sets of invoi!es orre!eipts

#/$ Printin" of unnu0bered re!eipts or sales or!o00er!ial invoi!es, not bearin" the na0e, businessstyle, a1payer Identifi!ation Nu0ber, and business

address of the person or entity.

he appellate !ourt2s relian!e on R7C No. *(+())/ is 0ispla!ed.he said Cir!ular !larified, inter alia, that failure to !o0ply withthe invoi!in" re=uire0ents on the do!u0ents supportin" the saleof "oods and servi!es would result in the disallowan!e of the!lai0 for refund or issuan!e of a ta1 !redit !ertifi!ate of !reditable


33/35

input ta1es. he said Cir!ular 0entioned as an e1a0ple thefailure to state the IN of the ta1payer in the invoi!e or re!eipt.However, in petitioner2s !ase, the prin!ipal "round for the denialof its !lai0 for refund or issuan!e of a ta1 !redit !ertifi!ate is its

failure to refle!t or indi!ate in its invoi!es the BIR authority toprint. 's earlier dis!ussed, the BIR authority to print is not one ofthe ite0s re=uired by law to be refle!ted or indi!ated in theinvoi!es or re!eipts. In any !ase, the said Cir!ular was issued on4uly &6, ())/ by then Co00issioner uiller0o 5. Parayno, 4r.,while petitioner2s !lai0 was filed on 7ay &3, &. Hen!e, R7CNo. *(+())/ !annot be applied retroa!tively be!ause to do sowould be preFudi!ial to petitioner. In a lon" line of !ases,99theCourt has affir0ed that the rulin"s, !ir!ulars, rules and

re"ulations pro0ul"ated by the Co00issioner on InternalRevenue would have no retroa!tive appli!ation if to so apply the0would be preFudi!ial to the ta1payers.

It bears reiteratin" that while the pertinent provisions of the a1Code and the rules and re"ulations i0ple0entin" the0 re=uireentities en"a"ed in business to se!ure a BIR authority to printinvoi!es or re!eipts and to issue duly re"istered invoi!es orre!eipts, it is not spe!ifi!ally re=uired that the BIR authority to

print be refle!ted or indi!ated therein. Indeed, what is i0portantwith respe!t to the BIR authority to print is that it has beense!ured or obtained by the ta1payer, and that invoi!es or re!eiptsare duly re"istered.

o stress, petitioner, as a 8'+re"istered entity, is en"a"ed ine1port sales of advan!ed and lar"e+s!ale ICs and, as su!h, underSe!tion &)9 #'$#($#a$#&$ of the a1 Code, its sales or transa!tionsare subFe!t to 8' at )G rate. >urther, subFe!t to the

re=uire0ents stated in Se!tion &&(#'$, it is entitled to !lai0refund or issuan!e of a ta1 !redit !ertifi!ate for input 8' ta1esattributable to its e1port sales. 's the Court had the o!!asion toe1plain sin!e no output 8' was i0posed on the ;ero+ratede1port sales, what the "overn0ent rei0burses or refunds to the!lai0ant is the input 8' paid thus, the ne!essity for the input8' paid to be substantiated by pur!hase invoi!es or offi!ial


34/35

re!eipts.9-hese sales invoi!es or re!eipts issued by the supplierare ne!essary to substantiate the a!tual a0ount or =uality of"oods sold and their sellin" pri!e, and, ta%en !olle!tively, are thebest 0eans to prove the input 8' pay0ents of the !lai0ant.93

In a !lai0 for refund or issuan!e of a ta1 !redit !ertifi!ateattributable to ;ero+rated sales, what is to be !losely s!rutini;edis the do!u0entary substantiation of the input 8' paid, as 0aybe proven by other e1port do!u0ents, rather than the supportin"do!u0ents for the ;ero+rated e1port sales. 'nd sin!e petitionerhas established by suffi!ient eviden!e that it is entitled to arefund or issuan!e of a ta1 !redit !ertifi!ate, in a!!ordan!e withthe re=uire0ents of Se!tions &)9 #'$#($#a$#&$ and &&(#'$ of the

a1 Code, then its !lai0 should not be denied, notwithstandin" itsfailure to state on the invoi!es the BIR authority to print and theIN+8. Lorthy of 0entionin" a"ain is the fa!t that even the C'and the C' have found petitioner to be le"ally entitled to a !lai0for refund or issuan!e of a ta1 !redit !ertifi!ate of its unutili;ed8' input ta1es on do0esti! pur!hases of "oods and servi!esattributable to its ;ero+rated sales.

Lhat applies to petitioner, as a PE:'+re"istered e1portenterprise, is the Court2s pronoun!e0ent that lenien!y in thei0ple0entation of the 8' is an i0perative, pre!isely to spure!ono0i! "rowth in the !ountry and attain "lobal !o0petitivenessas envisioned in our laws.9he in!entives offered to PE:'enterprises, a0on" whi!h are ta1 e1e0ptions and ta1 !redits,ulti0ately redound to the benefit of the national e!ono0y,enti!in" as they do 0ore enterprises to invest and do businesswithin the ;ones, thus !reatin" 0ore e0ploy0ent opportunitiesand infusin" 0ore dyna0is0 to the vibrant interplay of 0ar%et

for!es.

-)

Even as the Court now holds that petitioner is le"ally entitled to a

refund or issuan!e of a ta1 !redit !ertifi!ate of its unutili;ed 8'input ta1es on do0esti! pur!hases of "oods and servi!esattributable to its ;ero+rated sales, the !ase shall nevertheless bere0anded to the C' for proper deter0ination and !o0putation


35/35

of petitioner2s ta1 !redit?refund, !onsiderin" that in theReport-&of the independent auditor, Eliseo 'urellado, only thea0ount ofP,933,3).)) was dee0ed as petitioner2s valid !lai0for ta1 !redit.-('!!ordin" to 'urellado, the differen!e

ofP(,)3&,/-(./( fro0 petitioner2s input 8' !lai0of P&&,--),&3&.-) was not supported by suffi!ient do!u0entaryproof.-/he Court, not bein" a trier of fa!ts, !annot !ertainlyde!ide this fa!tual !ir!u0stan!e.

LHERE>ORE, pre0ises !onsidered, the petition is P'RI'55R'NED. he De!ision dated 'u"ust &(, ())* of the C' in C'+.R. SP No. -/(- is RE8ERSED and SE 'SIDE. he instant !aseis RE7'NDED to the Court of a1 'ppeals for the deter0ination

and !o0putation of petitioner2s ta1 !redit?refund.

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