G.R. No. 172458 - PHILIPPINE NATIONAL BANK, VS. COMMISSIONER OF INTERNAL REVENUE.D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE , premises considered, the present Petition For Review is hereby partially GRANTED . Respondent is hereby ORDERED to REFUND or ISSUE a Tax Credit Certificate in favor of herein petitioner in the amount of P 1,428,661.66, representing the latter's unutilized creditable withholding tax for the year 1998. [13] The CTA Division held that payments of withholding taxes for a certain taxable year were creditable to the payee's income tax liability as determined after it had filed its income tax returns the following year. The CTA Division said that since PNB posted net losses, it was not liable for any income tax and consequently, the taxes withheld during the course of the taxable year, which was 1998, while collected legally under Revenue Regulations No. 02-98, Section 2.57 (B), became untenable and took on the nature of erroneously collected taxes at the end of that year. The CTA Division averred that while the right to a refund is not automatic and must be established by sufficient evidence, there is nothing in the Tax Code that would suggest that the actual remittance of the withholding tax is a condition precedent to claim for a tax refund. Moreover, the CTA Division added, that the CIR failed to present the certification to prove his contention of PNB's non-remittance of the disallowed amount. However, the CTA Division affirmed the disallowance of eight transactions, amounting to ?445,578.92 as they had already been reported as income for other years, had not been recorded, or were not supported by pertinent documents. [14] On September 14, 2005, PNB filed a Motion for Partial Reconsideration, [15] asserting its entitlement to be refunded the amount of P445,578.92, by explaining each transaction involved and pinpointed by the CTA Division. This however was still denied by the CTA Division in its Resolution [16] dated November 15, 2005, for lack of merit. Aggrieved, PNB, filed a partial appeal by way of Petition for Review [17] under Section 18 of Republic Act No. 9282 [18] before the CTA En Banc , to review and modify the CTA Division's August 11, 2005 Decision. This petition was received by the CTA En Banc on December 27, 2005, four days beyond the additional 15 days granted to PNB to file its petition. Thus, on January 27, 2006, the CTA En Banc issued a Resolution [19] denying due course and consequently dismissing PNB's petition for the following reasons: 1) The Petition For Review was filed four (4) days late on December 27, 2005, the reglementary deadline for the timely filing of such petition being December 23, 2005. Appeal is a statutory privilege and must be exercised in the manner provided by law. Therefore, perfection of an appeal in the manner and within the period prescribed by law is not only mandatory, but jurisdictional, and non-compliance is fatal having the effect of rendering the judgment final and executory ( Cabellan vs. Court of Appeals, 304 SCRA 119 ). Not only that, late appeals deprives the appellate court of jur