G.R. No. 169778 - COMMISSIONER OF INTERNAL REVENUE, VS. SILICON PHILIPPINES, INC. (FORMERLY INTEL PHILIPPINES MANUFACTURING, INC.).D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE , the instant petition is PARTIALLY GRANTED . [Petitioner] is hereby ORDERED to ISSUE A TAX CREDIT CERTIFICATE to [respondent] in the amount of P8,179,049.00 representing input VAT on importation of capital goods. However, petitioners (respondents) claim for refund of input VAT in the sum of P21,338,910.44 attributable to zero-rated sales is hereby DENIED for lack of merit. [5] The CTA denied respondents claim for refund of input VAT on domestic purchases of goods and services attributable to zero-rated sales on the ground that the export sales invoices presented in support thereto do not have Bureau of Internal Revenue (BIR) permit to print, while the sales invoices do not show that the sale was zero-rated, all in violation of Sections 113 [6] and 238 [7] of the National Internal Revenue Code (NIRC) of 1997, as amended, and Section 4.108-1 of Revenue Regulations (RR) No. 7-95. [8] As to respondents claim for refund of input VAT on capital goods, the CTA looked into respondents compliance with the requirements set forth in the case of Air Liquid Philippines v. Commissioner of Internal Revenue and Commissioner of Customs, CTA Case No. 5652, 26 July 2000 , and held that said claim be partially denied considering that only the amount of P8,179,049.00 have been validly supported by documentary evidence such as suppliers invoices, official receipts, import declarations, import remittances and airway bills, showing the actual payment of VAT on the importation of capital goods as required by Section 4.104-5(b) of RR No. 7-95. [9] Relevant thereto, the CTA likewise made a factual finding that both the administrative and judicial claims of respondent were timely filed within the two-year prescriptive period required by the NIRC of 1997, as amended, reckoned from the date of filing the original quarterly VAT Return for the second quarter of taxable year 1998, or on 27 July 1998. [10] On 4 November 2003, the CTA denied respondents Partial Motion for Reconsideration (on the denial of its claim for tax credit or refund of input VAT paid in the sum of P21,338,910.44) for lack of merit. [11] Aggrieved, respondent appealed to the CA by filing a Petition for Review under Rule 43 of the Rules of Court on 10 December 2003, docketed as CA-G.R. SP No. 80886. The Ruling of the CA The CA found that respondents failure to secure a BIR authority or permit to print invoices or receipts does not completely destroy the integrity of its export sales invoices in support of its claim for refund, since the BIR permit to print is not among those required to be stated in the sales invoices or receipts to be issued by a taxpayer pursuant to Sections 113 and 237 of the NIRC of 1997, as amended. In addition, the BIR permit to print was only mentioned under Section 238 of the same code, which merely stated that the securement of the BIR authority to print by all persons engaged in business is necessary before a printer can print receipts or sales or commercial inv