8/9/2019 [SPIT] [CIR v. Benguet Corp.]
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SPIT | B2015CASE DIGESTS
CIR v. Benguet Corp.July 8, 2005
Tinga, J.
SUMMARY: Benguet Corp., relying on a 19 !AT t"at
#e$lare# t"at %ale o& gol# to t"e Central 'an( i% a
)ero*rate# tran%a$tion, entere# into tran%a$tion% t"at re%ulte#
ininput !AT in$urre# in relation to t"e %u'+e$t %ale% o&
gol#&ro 19 * 1991. It t"en -le# appli$ation% &or
tare&un#%/$re#it% $orre%pon#ing to input !AT. CI #i%alloe#t"e
appli$ation% 'y irtue o& a 1992 !A ruling t"at#e$lare# t"at
%u$" %ale o& gol# to t"e $entral 'an( i% not)ero*rate# 'ut
%u'+e$t to 103 !AT. CTA %i#e# it" t"e CI.reer%e# t"e CTA "i$" a%
a4re# 'y t"e SC.
DOCTRINE: !AT i% a per$entage ta ipo%e# at eery%tage o& t"e
#i%tri'ution pro$e%% on t"e %ale, 'arter,
e$"ange or lea%e o& goo#% or propertie% an# ren#ition
o&%eri$e% in t"e $our%e o& tra#e or 'u%ine%%, or
t"eiportation o& goo#%. It i% an in#ire$t ta, "i$" ay
'e%"i&te# to t"e 'uyer, tran%&eree, or le%%ee o& t"e
goo#%,propertie%, or %eri$e%. oeer, t"e party #ire$tly
lia'le&or t"e payent o& t"e ta i% t"e %eller.
T"e retroa$tie appli$ation o& t"e 1992 !AT rulingpre+u#i$e#
Benguet Corp. in iolation o& Se$.267 o& t"e8IC 'e$au%e it
in ee$t it"#re Benguet:% option to pa%%t"e !AT to t"e 'uyer,
Central Ban(, i& t"e %ale a% %u'+e$tto 103 !AT or $lai a ta
re&un# i& t"e tran%a$tion i% )ero*
rate#.
;8ot in $a%e< Se$. 107 o& t"e $urrent 8IC proi#e%
t"atSale o& gol# to t"e $entral 'an( 'y a !AT*regi%tere#
per%oni% a )ero*rate# tran%a$tion.=
FACTS< Benguet Corp. i% a !AT regi%tere# enterpri%e.Benguet
Corp. applie# &or an# a% grante# 'y t"e BI, )ero*rate# %tatu%
on it% %ale o& gol# to Central Ban(. T"e BI$ae out it" at lea%t
> i%%uan$e% proi#ing &or t"e )ero*
rating o& %ale o& gol# to t"e Central Ban(, t"e late%t
o& "i$"i% !AT uling 8o. 0?7*90 #ate# @e'ruary 16, 1990.
elying on it% )ero*rate# %tatu% an# t"e a'oe i%%uan$e%,Benguet
Corp. %ol# gol# to t"e Central Ban( an# entere#
into tran%a$tion% t"at re%ulte# in input !AT in$urre# inrelation
to t"e %u'+e$t %ale% o& gol#. It t"en -le#appli$ation% &or
ta re&un#%/$re#it% $orre%pon#ing to input!AT. T"e appli$ation%
ere eit"er una$te# upon or epre%%ly#i%alloe# 'y CI 'a%e# on BI !AT
uling 8o. 00*92 #ate#anuary 2?, 1992*t"at a% i%%ue# %u'%euent to
t"e$on%uation o& t"e %u'+e$t %ale% o& gol# to t"e
CentralBan( 'y Benguet Corp. "i$" proi#e% t"at %ale% o& gol#
tot"e Central Ban( %"all not 'e $on%i#ere# a% eport %ale% an#t"u%,
%"all 'e %u'+e$t to 103 !AT. CI al%o i%%ue# a#e-$ien$y a%%e%%ent
again%t Benguet Corp. "en, a&terapplying Benguet Corp.:%
$re#ita'le input !AT $o%t% again%t
t"e retroa$tie 103 !AT ley, t"ere re%ulte# a 'alan$e o&e$e%%
output !AT.
T"e BI al%o i%%ue# !AT uling 8o. 059*92 an# C 22*92"i$" #e$ree#
t"at t"e reo$ation o& !AT uling 8o. ?>*'y !AT uling 8o.
00*92 oul# not un#uly pre+u#i$e ining$opanie% an#, t"u%, $oul# 'e
applie# retroa$tiely.
Benguet Corp. -le# t"ree %eparate petition% &or reie it"t"e
CTA "ere it argue# t"at a retroa$tie appli$ation o& BI!AT uling
8o. 00*92 oul# iolate Se$. 267 o& t"e 8IC,"i$" an#ate% t"e
non*retroa$tiity o& ruling% or $ir$ular%
i%%ue# 'y t"e Coi%%ioner o& Internal eenue t"at oul#operate
to pre+u#i$e t"e tapayer.
CTA #i%i%%e# Benguet Corp.:% re%pe$tie petition% %tatingt"at no
pre+u#i$e "a# 'e&allen Benguet Corp. 'y irtue o&t"e
retroa$tie appli$ation. T"e CA reer%e# t"e CTA 'y%tating t"at
Benguet Corp. %uere# pre+u#i$e 'y t"eretroa$tie appli$ation i&
t"e 1992 !AT ruling.
ISSUES< 8 Benguet Corp.:% %ale o& gol# to t"e CentralBan(
#uring t"e perio# "en %u$" a% $la%%i-e# 'y BI
