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VAT CASES – ADVANCE TAXATION LAW REVIEW 2016

Republic of the hilippi!e"SUPREME COURT

#$!il$

%IRST DIVISION

G.R. No. 191498 January 15, 2014

COMMISSIONER OF INTERNA RE!ENUE, etitio!e&'(")MIN"ANAO II GEOT#ERMA PARTNERS#IP, Re"po!*e!t)

D E C I S I O N

SERENO, CJ:

Thi" Rule +, etitio!1 &e-ui&e" thi" Cou&t to $**&e"" the -ue"tio! ofti.eli!e"" /ith &e"pect to petitio!e&" $*.i!i"t&$ti(e $!* u*ici$l cl$i." fo&&efu!* $!* c&e*it of $ccu.ul$te* u!utilie* i!put V$lue A**e* T$3 4VAT5u!*e& Sectio! 1124A5 $!* Sectio! 1124D5 of the 17 T$3 Co*e) etitio!e&#i!*$!$o II 8eothe&.$l $&t!e&"hip 4#i!*$!$o II5 $""$il" the Deci"io!2 $!*Re"olutio!9 of the Cou&t of T$3 Appe$l" E! :$!c 4CTA E! :$!c5 i! CTA E!:$!c C$"e No) ++;' $


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26 ul? 200+ 12 ul? 200, 2!* 200+

22 Octobe& 200+ 12 ul? 200, 9&* 200+

2, $!u$&? 200, 12 ul? 200, +th 200+

O! 6 Octobe& 200,' #i!*$!$o II >le* /ith the :u&e$u of I!te&!$l Re(e!ue4:IR5 $! $pplic$tio! fo& the &efu!* o& c&e*it of $ccu.ul$te* u!utilie*c&e*it$ble i!put t$3e") I! "uppo&t of the $*.i!i"t&$ti(e cl$i. fo& &efu!* o&c&e*it' #i!*$!$o II $lle=e*' $.o!= othe&"' th$t it i" &e=i"te&e* /ith the :IR$" $ ($lue$**e* t$3p$?e&10 $!* $ll it" "$le" $&e e&o&$te* u!*e& the EIRAl$/)11 It fu&the& "t$te* th$t fo& the "eco!*' thi&*' $!* fou&th -u$&te&" oft$3$ble ?e$& 200+' it p$i* i!put VAT i! the $==&e=$te $.ou!tof 7'167'00,);+' /hich /e&e *i&ectl? $tt&ibut$ble to the e&o&$te* "$le")

The i!put t$3e" h$* !ot bee! $pplie* $=$i!"t output t$3)

u&"u$!t to Sectio! 1124D5 of the 17 T$3 Co*e' the Co..i""io!e& ofI!te&!$l Re(e!ue 4CIR5 h$* $ pe&io* of 120 *$?"' o& u!til 9 %eb&u$&? 2006' to$ct o! the cl$i.) The $*.i!i"t&$ti(e cl$i.' ho/e(e&' &e.$i!e* u!&e"ol(e*o! 9 %eb&u$&? 2006)

!*e& the "$.e p&o(i"io!' #i!*$!$o II coul* t&e$t the i!$ctio! of the CIR $"$ *e!i$l of it" cl$i.' i! /hich c$"e' the fo&.e& /oul* h$(e 90 *$?" to >le $!$ppe$l to the CTA' th$t i"' o! , #$&ch 2006) #i!*$!$o II' ho/e(e&' *i* !ot

>le $! $ppe$l /ithi! the 90*$? pe&io*)App$&e!tl?' #i!*$!$o II belie(e* th$t $ u*ici$l cl$i. .u"t be >le* /ithi!the t/o?e$& p&e"c&ipti(e pe&io* p&o(i*e* u!*e& Sectio! 1124A5 $!* th$t"uch ti.e f&$.e /$" to be &ecFo!e* f&o. the >li!= of it" @u$&te&l? VATRetu&!" fo& the "eco!*' thi&*' $!* fou&th -u$&te&" of t$3$ble ?e$& 200+' th$ti"' f&o. 26 ul? 200+' 22 Octobe& 200+' $!* 2, $!u$&? 200,' &e"pecti(el?)

Thu"' o! 21 ul? 2006' #i!*$!$o II' cl$i.i!= i!$ctio! o! the p$&t of the CIR$!* th$t the t/o?e$& p&e"c&ipti(e pe&io* /$" $bout to e3pi&e' >le* $etitio! fo& Re(ie/ /ith the CTA *ocFete* $" CTA C$"e No) 6199)12

O! ; u!e 2007' /hile the $pplic$tio! fo& &efu!* o& c&e*it of u!utilie* i!putVAT of #i!*$!$o II /$" pe!*i!= befo&e the CTA Seco!* Di(i"io!' thi" Cou&tp&o.ul=$te* Atl$" Co!"oli*$te* #i!i!= $!* De(elop.e!t Co&po&$tio! ()CIR194Atl$"5) Atl$" hel* th$t the t/o?e$& p&e"c&ipti(e pe&io* fo& the >li!= of$ cl$i. fo& $! i!put VAT &efu!* o& c&e*it i" to be &ecFo!e* f&o. the *$te of>li!= of the co&&e"po!*i!= -u$&te&l? VAT &etu&! $!* p$?.e!t of the t$3)

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O! 12 Au=u"t 200;' the CTA Seco!* Di(i"io! &e!*e&e* $ Deci"io!1+ o&*e&i!=the CIR to =&$!t $ &efu!* o& $ t$3 c&e*it ce&ti>c$te' but o!l? i! the &e*uce*$.ou!t of 6'71';+,)2+' &ep&e"e!ti!= u!utilie* i!put VAT i!cu&&e* fo& the"eco!*' thi&* $!* fou&th -u$&te&" of t$3$ble ?e$& 200+)1,

I! "uppo&t of it" &uli!=' the CTA Seco!* Di(i"io! hel* th$t #i!*$!$o II

co.plie* /ith the t/i! &e-ui"ite" fo& VAT e&o&$ti!= u!*e& the EIRA l$/>&"t' it i" $ =e!e&$tio! co.p$!?' $!* "eco!*' it *e&i(e* "$le" f&o. po/e&=e!e&$tio!) It $l"o &ule* th$t #i!*$!$o II "$ti">e* the &e-ui&e.e!t" fo& the=&$!t of $ &efu!*Gc&e*it u!*e& Sectio! 112 of the T$3 Co*e 415 the&e .u"tbe e&o&$te* o& eHecti(el? e&o&$te* "$le" 425 i!put t$3e" .u"t h$(e bee!i!cu&&e* o& p$i* 495 the c&e*it$ble i!put t$3 *ue o& p$i* .u"t be$tt&ibut$ble to e&o&$te* "$le" o& eHecti(el? e&o&$te* "$le" 4+5 the i!putVAT p$?.e!t" .u"t !ot h$(e bee! $pplie* $=$i!"t $!? output li$bilit? $!*4,5 the cl$i. .u"t be >le* /ithi! the t/o?e$& p&e"c&ipti(e pe&io*)16

A" to the "eco!* &e-ui"ite' ho/e(e&' the i!put t$3 cl$i. to the e3te!tof 97,'160)60 co&&e"po!*i!= to pu&ch$"e" of "e&(ice" f&o. #it"ubi"hiCo&po&$tio! /$" *i"$llo/e*' "i!ce it /$" !ot "ub"t$!ti$te* b? ole* it" @u$&te&l? VAT Retu&!"fo& the "eco!*' thi&*' $!* fou&th -u$&te&" of t$3$ble ?e$& 200+' &e"pecti(el?

– $!* *ete&.i!e* th$t both the $*.i!i"t&$ti(e cl$i. >le* o! 6 Octobe& 200,$!* the u*ici$l cl$i. >le* o! 21 ul? 2006 fell /ithi! the t/o?e$&p&e"c&ipti(e pe&io*)1;

O! 1 Septe.be& 200;' the CIR >le* $ #otio! fo& $&ti$lReco!"i*e&$tio!'1 poi!ti!= out th$t p&e"c&iptio! h$* $l&e$*? "et i!' "i!cethe $ppe$l to the CTA /$" >le* o!l? o! 21 ul? 2006' /hich /$" /$? be?o!*the l$"t *$? to $ppe$l – , #$&ch 2006)20 A" le=$l b$"i" fo& thi" $&=u.e!t' theCIR &elie* o! Sectio! 1124D5 of the 17 T$3 Co*e)21

#e$!/hile' o! 12 Septe.be& 200;' thi" Cou&t p&o.ul=$te* CIR () #i&$!t$=bil$o Co&po&$tio! 4#i&$!t5)22 #i&$!t >3e* the &ecFo!i!= *$te of the t/o?e$& p&e"c&ipti(e pe&io* fo& the $pplic$tio! fo& &efu!* o& c&e*it of u!utilie*i!put VAT $t the clo"e of the t$3$ble -u$&te& /he! the &ele($!t "$le" /e&e.$*e ' $" "t$te* i! Sectio! 1124A5)29

O! 9 Dece.be& 200;' the CTA Seco!* Di(i"io! *e!ie* the CIRJ" #otio! fo&$&ti$l Reco!"i*e&$tio!)2+ The t$3 cou&t "too* b? it" &eli$!ce o! Atl$"2, $!*

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o! it" >!*i!= th$t both the $*.i!i"t&$ti(e $!* u*ici$l cl$i." of #i!*$!$o II/e&e ti.el? >le*)26

O! 7 $!u$&? 200' the CIR ele($te* the .$tte& to the CTA E! :$!c (i$ $etitio! fo& Re(ie/)27 Ap$&t f&o. the co!te!tio! th$t the u*ici$l cl$i. of#i!*$!$o II /$" >le* be?o!* the 90*$? pe&io* >3e* b? Sectio! 1124D5 of

the 17 T$3 Co*e'2; the CIR $&=ue* th$t #i!*$!$o II e&&o!eou"l? >3e* 26 ul? 200+' the *$te /he! the &etu&! fo& the "eco!* -u$&te& /$" >le*' $" the*$te f&o. /hich to &ecFo! the t/o?e$& p&e"c&ipti(e pe&io* fo& >li!= $!$pplic$tio! fo& &efu!* o& c&e*it of u!utilie* i!put VAT u!*e& Sectio! 1124A5)A" the t/o?e$& p&e"c&ipti(e pe&io* e!*e* o! 90 u!e 2006' the etitio! fo&Re(ie/ of #i!*$!$o II /$" >le* out of ti.e o! 21 ul? 2006)2 The CIRi!(oFe* the &ece!tl? p&o.ul=$te* #i&$!t to "uppo&t thi" theo&?)

O! 11 No(e.be& 200' the CTA E! :$!c &e!*e&e* it" Deci"io! *e!?i!= theCIRJ" etitio! fo& Re(ie/)90 O! the -ue"tio! /hethe& the $pplic$tio! fo&&efu!* /$" ti.el? >le*' it hel* th$t the CTA Seco!* Di(i"io! co&&ectl?$pplie* the Atl$" &uli!=)91 It &e$"o!e* th$t Atl$" &e.$i!e* to be theco!t&olli!= *oct&i!e) #i&$!t /$" $ !e/ *oct&i!e $!*' $" "uch' the l$tte&"houl* !ot $ppl? &et&o$cti(el? to #i!*$!$o II /ho h$* &elie* o! the ol**oct&i!e of Atl$" $!* h$* $cte* o! the f$ith the&eof)92

A" to the i""ue of co.pli$!ce /ith the 90*$? pe&io* fo& $ppe$l to the CTA'the CTA E! :$!c hel* th$t thi" /$" $ &e-ui&e.e!t o!l? /he! the CIR$ctu$ll? *e!ie" the t$3p$?e&J" cl$i.) :ut i! c$"e" of CIR i!$ctio!' the 90*$?

pe&io* i" !ot $ .$!*$to&? &e-ui&e.e!t the u*ici$l cl$i. i" "e$"o!$bl? >le*$" lo!= $" it i" >le* $fte& the l$p"e of the 120*$? /$iti!= pe&io* but /ithi!t/o ?e$&" f&o. the *$te of >li!= of the &etu&!)99

The CIR >le* $ #otio! fo& $&ti$l Reco!"i*e&$tio!9+ of the Deci"io!' but it/$" *e!ie* fo& l$cF of .e&it)9,

Di""$ti">e*' the CIR >le* thi" Rule +, etitio!' &$i"i!= the follo/i!=$&=u.e!t" i! "uppo&t of it" $ppe$l

I)

TKE CTA 2ND DIVISION LACED RISDICTION TO TAE CO8NIMANCE O% TKE CASE)

II)

TKE CORT A @OJS RELIANCE ON TKE RLIN8 IN ATLAS IS #ISLACED)96

+

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ISSES

The &e"olutio! of thi" c$"e hi!=e" o! the -ue"tio! of co.pli$!ce /ith thefollo/i!= ti.e &e-ui&e.e!t" fo& the =&$!t of $ cl$i. fo& &efu!* o& c&e*it ofu!utilie* i!put VAT 415 the t/o?e$& p&e"c&ipti(e pe&io* fo& >li!= $!$pplic$tio! fo& &efu!* o& c&e*it of u!utilie* i!put VAT $!* 425 the 12090

*$? pe&io* fo& >li!= $! $ppe$l /ith the CTA)

TKE CORTJS RLIN8

We *e!? #i!*$!$o IIJ" cl$i. fo& &efu!* o& c&e*it of u!utilie* i!put VAT o!the =&ou!* th$t it" u*ici$l cl$i." /e&e >le* out of ti.e' e(e! $" /e hol*th$t it" $pplic$tio! fo& &efu!* /$" >le* o! ti.e)

I)

#INDANAO IIJS ALICATION %ORRE%ND WAS %ILED ON TI#E

We >!* !o e&&o& i! the co!clu"io! of the t$3 cou&t" th$t the $pplic$tio! fo&&efu!* o& c&e*it of u!utilie* i!put VAT /$" ti.el? >le*) The p&oble. lie"/ith thei& b$"e" fo& the co!clu"io! $" to 415 /h$t "houl* be >le* /ithi! thep&e"c&ipti(e pe&io* $!* 425 the *$te f&o. /hich to &ecFo! the p&e"c&ipti(epe&io*)

We thu" t$Fe $ *iHe&e!t &oute to &e$ch the "$.e co!clu"io!' i!iti$ll?focu"i!= ou& *i"cu""io! o! /h$t "houl* be >le* /ithi! the t/o?e$&p&e"c&ipti(e pe&io*)

A) The u*ici$l Cl$i. Nee* Not :e %ile* Withi! the T/oBe$& &e"c&ipti(ee&io*

Sectio! 1124A5 p&o(i*e"

SEC) 112) Refu!*" o& T$3 C&e*it" of I!put T$3)

4A5 Me&o&$te* o& EHecti(el? Me&o&$te* S$le" A!? VAT&e=i"te&e* pe&"o!'/ho"e "$le" $&e e&o&$te* o& eHecti(el? e&o&$te* .$?' /ithi! t/o 425?e$&" $fte& the clo"e of the t$3$ble -u$&te& /he! the "$le" /e&e .$*e'$ppl? fo& the i""u$!ce of $ t$3 c&e*it ce&ti>c$te o& &efu!* of c&e*it$ble i!putt$3 *ue o& p$i* $tt&ibut$ble to "uch "$le"' e3cept t&$!"itio!$l i!put t$3' tothe e3te!t th$t "uch i!put t$3 h$" !ot bee! $pplie* $=$i!"t output t$3&o(i*e*' ho/e(e&' Th$t i! the c$"e of e&o&$te* "$le" u!*e& Sectio!1064A54254$5415' 425 $!* 4:5 $!* Sectio! 10;4:5415 $!* 425' the $ccept$ble

,


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fo&ei=! cu&&e!c? e3ch$!=e p&ocee*" the&eof h$* bee! *ul? $ccou!te* fo& i!$cco&*$!ce /ith the &ule" $!* &e=ul$tio!" of the :$!=Fo Se!t&$l != ilipi!$"4:S5 &o(i*e*' fu&the&' Th$t /he&e the t$3p$?e& i" e!=$=e* i! e&o&$te*o& eHecti(el? e&o&$te* "$le $!* $l"o i! t$3$ble o& e3e.pt "$le of =oo*" o&p&ope&tie" o& "e&(ice"' $!* the $.ou!t of c&e*it$ble i!put t$3 *ue o& p$i*c$!!ot be *i&ectl? $!* e!ti&el? $tt&ibute* to $!? o!e of the t&$!"$ctio!"' it

"h$ll be $lloc$te* p&opo&tio!$tel? o! the b$"i" of the (olu.e of "$le")

:oth the CTA Seco!* Di(i"io! $!* CTA E! :$!c *eci"io!" hel* th$t theph&$"e P$ppl? fo& the i""u$!ce of $ t$3 c&e*it ce&ti>c$te o& &efu!*P i!Sectio! 1124A5 i" co!"t&ue* to &efe& to both the $*.i!i"t&$ti(e cl$i. >le*/ith the CIR $!* the u*ici$l cl$i. >le* /ith the CTA) Thi" (ie/' ho/e(e&'h$" !o le=$l b$"i")

I! Co..i""io!e& of I!te&!$l Re(e!ue () Aichi %o&=i!= Co.p$!? of A"i$' I!c)4Aichi5' /e *i"pelle* the .i"co!ceptio! th$t both the $*.i!i"t&$ti(e $!*

u*ici$l cl$i." .u"t be >le* /ithi! the t/o?e$& p&e"c&ipti(e pe&io*97

The&e i" !othi!= i! Sectio! 112 of the NIRC to "uppo&t &e"po!*e!tJ" (ie/)Sub"ectio! 4A5 of the "$i* p&o(i"io! "t$te" th$t P$!? VAT&e=i"te&e* pe&"o!'/ho"e "$le" $&e e&o&$te* o& eHecti(el? e&o&$te* .$?' /ithi! t/o ?e$&"$fte& the clo"e of the t$3$ble -u$&te& /he! the "$le" /e&e .$*e' $ppl? fo&the i""u$!ce of $ t$3 c&e*it ce&ti>c$te o& &efu!* of c&e*it$ble i!put t$3 *ueo& p$i* $tt&ibut$ble to "uch "$le")P The ph&$"e P/ithi! t/o 425 ?e$&" 3 3 3$ppl? fo& the i""u$!ce of $ t$3 c&e*it ce&ti>c$te o& &efu!*P &efe&" to

$pplic$tio!" fo& &efu!*Gc&e*it >le* /ith the CIR $!* !ot to $ppe$l" .$*e tothe CTA) Thi" i" $pp$&e!t i! the >&"t p$&$=&$ph of "ub"ectio! 4D5 of the"$.e p&o(i"io!' /hich "t$te" th$t the CIR h$" P120 *$?" f&o. the"ub.i""io! of co.plete *ocu.e!t" i! "uppo&t of the $pplic$tio! >le* i!$cco&*$!ce /ith Sub"ectio!" 4A5 $!* 4:5P /ithi! /hich to *eci*e o! thecl$i.)

I! f$ct' $ppl?i!= the t/o?e$& pe&io* to u*ici$l cl$i." /oul* &e!*e&!u=$to&? Sectio! 112 4D5 of the NIRC' /hich $l&e$*? p&o(i*e" fo& $ "peci>cpe&io* /ithi! /hich $ t$3p$?e& "houl* $ppe$l the *eci"io! o& i!$ctio! of theCIR) The "eco!* p$&$=&$ph of Sectio! 112 4D5 of the NIRC e!(i"io!" t/o"ce!$&io" 415 /he! $ *eci"io! i" i""ue* b? the CIR befo&e the l$p"e of the120*$? pe&io* $!* 425 /he! !o *eci"io! i" .$*e $fte& the 120*$? pe&io*)I! both i!"t$!ce"' the t$3p$?e& h$" 90 *$?" /ithi! /hich to >le $! $ppe$l/ith the CTA) A" /e "ee it the!' the 120*$? pe&io* i" c&uci$l i! >li!= $!$ppe$l /ith the CTA) 4E.ph$"i" "upplie*5

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The .e""$=e of Aichi i" cle$& it i" o!l? the $*.i!i"t&$ti(e cl$i. th$t .u"tbe >le* /ithi! the t/o?e$& p&e"c&ipti(e pe&io* the u*ici$l cl$i. !ee* !otf$ll /ithi! the t/o?e$& p&e"c&ipti(e pe&io*)

K$(i!= *i"po"e* of thi" -ue"tio!' /e p&ocee* to the *$te fo& &ecFo!i!= thep&e"c&ipti(e pe&io* u!*e& Sectio! 1124A5)

:) RecFo!i!= D$te i" the Clo"e of the T$3$ble @u$&te& Whe! the Rele($!tS$le" We&e #$*e)

The othe& Q$/ i! the &e$"o!i!= of the t$3 cou&t" i" thei& &eli$!ce o! theAtl$" &uli!=' /hich >3e* the &ecFo!i!= poi!t to the *$te of >li!= the &etu&!$!* p$?.e!t of the t$3)

The CIRJ" St$!*

The CIRJ" "t$!* i" th$t Atl$" i" !ot $pplic$ble to the c$"e $t h$!* $" iti!(ol(e" Sectio! 290 of the 177 T$3 Co*e' /hich co!te.pl$te" &eco(e&? oft$3 p$?.e!t" e&&o!eou"l? o& ille=$ll? collecte*) O! the othe& h$!*' thi" c$"e*e$l" /ith cl$i." fo& t$3 &efu!* o& c&e*it of u!utilie* i!put VAT fo& the"eco!*' thi&*' $!* fou&th -u$&te&" of 200+' /hich $&e co(e&e* b? Sectio!112 of the 177 T$3 Co*e)9;

The CIR fu&the& co!te!*" th$t #i!*$!$o II c$!!ot cl$i. =oo* f$ith &eli$!ceo! the Atl$" *oct&i!e "i!ce the c$"e /$" *eci*e* o!l? o! ; u!e 2007' t/o

?e$&" $fte& #i!*$!$o II >le* it" cl$i. fo& &efu!* o& c&e*it /ith the CIR $!*o!e ?e$& $fte& it >le* $ etitio! fo& Re(ie/ /ith the CTA o! 21 ul? 2006)9

I! lieu of Atl$"' the CIR p&opo"e" th$t it i" the Cou&t" &uli!= i! #i&$!t th$t"houl* $ppl? to thi" c$"e *e"pite the f$ct th$t the l$tte& /$" p&o.ul=$te* o!12 Septe.be& 200;' $fte& #i!*$!$o II h$* >le* it" $*.i!i"t&$ti(e cl$i. i!200,)+0It $&=ue" th$t #i&$!t c$! be $pplie* &et&o$cti(el? to thi" c$"e' "i!cethe *eci"io! .e&el? i!te&p&et" Sectio! 112' $ p&o(i"io! th$t /$" $l&e$*?eHecti(e /he! #i!*$!$o II >le* it" cl$i." fo& t$3 &efu!* o& c&e*it)

The T$3p$?e&J" Defe!"e

O! the othe& h$!*' #i!*$!$o II cou!te&" th$t Atl$"' *eci*e* b? the Thi&*Di(i"io! of thi" Cou&t' coul* !ot h$(e bee! "upe&"e*e* b? #i&$!t' $ Seco!*Di(i"io! Deci"io! of thi" Cou&t) A *oct&i!e l$i* *o/! b? the Sup&e.e Cou&t i!$ Di(i"io! .$? be .o*i>e* o& &e(e&"e* o!l? th&ou=h $ *eci"io! of the Cou&t"itti!= e! b$!c)+1

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pe&"o! the t$3p$?e& /ho i" le=$ll? li$ble $!* /ho i" *ee.e* to h$(ele=$ll? p$i* fo& the i!put VAT /ho c$! $"F fo& $ t$3 &efu!* o& c&e*it u!*e&Sectio! 22 $" $! o&*i!$&? &efu!* o& c&e*it out"i*e of the VAT S?"te.) I!"uch e(e!t' the "eco!* VAT&e=i"te&e* t$3p$?e& /ill h$(e !o i!put VAT tooH"et $=$i!"t hi" o/! output VAT)

I! $ cl$i. fo& &efu!* o& c&e*it of Pe3ce""P i!put VAT u!*e& Sectio! 1104:5$!* Sectio! 1124A5' the i!put VAT i" !ot Pe3ce""i(el?P collecte* $"u!*e&"too* u!*e& Sectio! 22) At the ti.e of p$?.e!t of the i!put VAT the$.ou!t p$i* i" the co&&ect $!* p&ope& $.ou!t) !*e& the VAT S?"te.' the&ei" !o cl$i. o& i""ue th$t the i!put VAT i" Pe3ce""i(el?P collecte*' th$t i"' th$tthe i!put VAT p$i* i" .o&e th$! /h$t i" le=$ll? *ue) The pe&"o! le=$ll? li$blefo& the i!put VAT c$!!ot cl$i. th$t he o(e&p$i* the i!put VAT b? the .e&ee3i"te!ce of $! Pe3ce""P i!put VAT) The te&. Pe3ce""P i!put VAT "i.pl?.e$!" th$t the i!put VAT $($il$ble $" c&e*it e3cee*" the output VAT' !ot

th$t the i!put VAT i" e3ce""i(el? collecte* bec$u"e it i" .o&e th$! /h$t i"le=$ll? *ue) Thu"' the t$3p$?e& /ho le=$ll? p$i* the i!put VAT c$!!ot cl$i.fo& &efu!* o& c&e*it of the i!put VAT $" Pe3ce""i(el?P collecte* u!*e& Sectio!22)

!*e& Sectio! 22' the p&e"c&ipti(e pe&io* fo& >li!= $ u*ici$l cl$i. fo&&efu!* i" t/o ?e$&" f&o. the *$te of p$?.e!t of the t$3 Pe&&o!eou"l?' ) ) )ille=$ll?' ) ) ) e3ce""i(el? o& i! $!? .$!!e& /&o!=full? collecte*)P Thep&e"c&ipti(e pe&io* i" &ecFo!e* f&o. the *$te the pe&"o! li$ble fo& the t$3p$?" the t$3) Thu"' if the i!put VAT i" i! f$ct Pe3ce""i(el?P collecte*' th$t i"'

the pe&"o! li$ble fo& the t$3 $ctu$ll? p$?" .o&e th$! /h$t i" le=$ll? *ue' thet$3p$?e& .u"t >le $ u*ici$l cl$i. fo& &efu!* /ithi! t/o ?e$&" f&o. hi" *$teof p$?.e!t) O!l? the pe&"o! le=$ll? li$ble to p$? the t$3 c$! >le the u*ici$lcl$i. fo& &efu!*) The pe&"o! to /ho. the t$3 i" p$""e* o! $" p$&t of thepu&ch$"e p&ice h$" !o pe&"o!$lit? to >le the u*ici$l cl$i. u!*e& Sectio!22)

!*e& Sectio! 1104:5 $!* Sectio! 1124A5' the p&e"c&ipti(e pe&io* fo& >li!= $ u*ici$l cl$i. fo& Pe3ce""P i!put VAT i" t/o ?e$&" f&o. the clo"e of the

t$3$ble -u$&te& /he! the "$le /$" .$*e b? the pe&"o! le=$ll? li$ble to p$?the output VAT) Thi" p&e"c&ipti(e pe&io* h$" !o &el$tio! to the *$te ofp$?.e!t of the Pe3ce""P i!put VAT) The Pe3ce""P i!put VAT .$? h$(e bee!p$i* fo& .o&e th$! t/o ?e$&" but thi" *oe" !ot b$& the >li!= of $ u*ici$lcl$i. fo& Pe3ce""P VAT u!*e& Sectio! 1124A5' /hich h$" $ *iHe&e!t &ecFo!i!=pe&io* f&o. Sectio! 22) #o&eo(e&' the pe&"o! cl$i.i!= the &efu!* o& c&e*itof the i!put VAT i" !ot the pe&"o! /ho le=$ll? p$i* the i!put VAT) Suchpe&"o! "eeFi!= the VAT &efu!* o& c&e*it *oe" !ot cl$i. th$t the i!put VAT


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/$" Pe3ce""i(el?P collecte* f&o. hi.' o& th$t he p$i* $! i!put VAT th$t i".o&e th$! /h$t i" le=$ll? *ue) Ke i" !ot the t$3p$?e& /ho le=$ll? p$i* thei!put VAT)

A" it" !$.e i.plie"' the V$lueA**e* T$3 "?"te. i" $ t$3 o! the ($lue $**e*b? the t$3p$?e& i! the ch$i! of t&$!"$ctio!") %o& "i.plicit? $!* e


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VAT o& "ub"e-ue!t "$le of =oo*"' p&ope&tie"' o& "e&(ice" u"i!= .$te&i$l""ubect to i!put VAT)

%&o. the pl$i! te3t of Sectio! 22' it i" cle$& th$t /h$t c$! be &efu!*e* o&c&e*ite* i" $ t$3 th$t i" Pe&&o!eou"l? ) ) ) ille=$ll?' ) ) ) e3ce""i(el? o& i! $!?.$!!e& /&o!=full? collecte*)P I! "ho&t' the&e .u"t be $ /&o!=ful p$?.e!t

bec$u"e /h$t i" p$i*' o& p$&t of it' i" !ot le=$ll? *ue) A" the Cou&t hel* i!#i&$!t' Sectio! 22 "houl* P$ppl? o!l? to i!"t$!ce" of e&&o!eou" p$?.e!t o&ille=$l collectio! of i!te&!$l &e(e!ue t$3e")P E&&o!eou" o& /&o!=ful p$?.e!ti!clu*e" e3ce""i(e p$?.e!t bec$u"e the? $ll &efe& to p$?.e!t of t$3e" !otle=$ll? *ue) !*e& the VAT S?"te.' the&e i" !o cl$i. o& i""ue th$t thePe3ce""P i!put VAT i" Pe3ce""i(el? o& i! $!? .$!!e& /&o!=full? collecte*)P I!f$ct' if the Pe3ce""P i!put VAT i" $! Pe3ce""i(el?P collecte* t$3 u!*e& Sectio!22' the! the t$3p$?e& cl$i.i!= to $ppl? "uch Pe3ce""i(el?P collecte* i!putVAT to oH"et hi" output VAT .$? h$(e !o le=$l b$"i" to .$Fe "uch

oH"etti!=) The pe&"o! le=$ll? li$ble to p$? the i!put VAT c$! cl$i. $ &efu!*o& c&e*it fo& "uch Pe3ce""i(el?P collecte* t$3' $!* thu" the&e /ill !o lo!=e&be $!? Pe3ce""P i!put VAT) Thi" /ill upe!* the p&e"e!t VAT S?"te. $" /eF!o/ it)+,

T/o thi!=" $&e cle$& f&o. the $bo(e -uote* S$! Ro-ue *i"-ui"itio!") %i&"t'/he! it co.e" to &eco(e&? of u!utilie* i!put VAT' Sectio! 112' $!* !otSectio! 22 of the 17 T$3 Co*e' i" the =o(e&!i!= l$/) Seco!*' p&io& to ;

u!e 2007' the $pplic$ble &ule i" !eithe& Atl$" !o& #i&$!t' but Sectio!1124A5)

We p&e"e!t the &ule" l$i* *o/! b? S$! Ro-ue i! *ete&.i!i!= the p&ope&&ecFo!i!= *$te of the t/o?e$& p&e"c&ipti(e pe&io* th&ou=h the follo/i!=ti.eli!e

Thu"' the t$"F $t h$!* i" to *ete&.i!e the $pplic$ble pe&io* fo& thi" c$"e)

I! thi" c$"e' #i!*$!$o II >le* it" $*.i!i"t&$ti(e cl$i." fo& &efu!* o& c&e*itfo& the "eco!*' thi&* $!* fou&th -u$&te&" of 200+ o! 6 Octobe& 200,) Thec$"e thu" f$ll" /ithi! the >&"t pe&io* $" i!*ic$te* i! the $bo(e ti.eli!e) I!

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othe& /o&*"' it i" co(e&e* b? the &ule p&io& to the $*(e!t of eithe& Atl$" o&#i&$!t)

Acco&*i!=l?' the p&ope& &ecFo!i!= *$te i! thi" c$"e' $" p&o(i*e* b? Sectio!1124A5 of the 17 T$3 Co*e' i" the clo"e of the t$3$ble -u$&te& /he! the&ele($!t "$le" /e&e .$*e)

C) The A*.i!i"t&$ti(e Cl$i." We&e Ti.el? %ile*

We "u. up ou& co!clu"io!" "o f$& 415 it i" o!l? the $*.i!i"t&$ti(e cl$i. th$t.u"t be >le* /ithi! the t/o?e$& p&e"c&ipti(e pe&io* $!* 425 the t/o?e$&p&e"c&ipti(e pe&io* be=i!" to &u! f&o. the clo"e of the t$3$ble -u$&te& /he!the &ele($!t "$le" /e&e .$*e)

:e$&i!= the"e i! .i!*' /e !o/ p&ocee* to *ete&.i!e /hethe& #i!*$!$o II"$*.i!i"t&$ti(e cl$i." fo& the "eco!*' thi&*' $!* fou&th -u$&te&" of 200+

/e&e ti.el? >le*)

Seco!* @u$&te&

Si!ce the e&o&$te* "$le" /e&e .$*e i! the "eco!* -u$&te& of 200+' the*$te of &ecFo!i!= the t/o?e$& p&e"c&ipti(e pe&io* i" the clo"e of the "eco!*-u$&te&' /hich i" o! 90 u!e 200+) Appl?i!= Sectio! 1124A5' #i!*$!$o II h$*t/o ?e$&" f&o. 90 u!e 200+' o& u!til 90 u!e 2006 to >le $! $*.i!i"t&$ti(ecl$i. /ith the CIR) #i!*$!$o II >le* it" $*.i!i"t&$ti(e cl$i. o! 6 Octobe&

200,' /hich i" /ithi! the t/o?e$& p&e"c&ipti(e pe&io*) The $*.i!i"t&$ti(ecl$i. fo& the "eco!* -u$&te& of 200+ /$" thu" ti.el? >le*) %o& cl$&it?' /ep&e"e!t the &ule" l$i* *o/! b? S$! Ro-ue i! *ete&.i!i!= the p&ope&&ecFo!i!= *$te of the t/o?e$& p&e"c&ipti(e pe&io* th&ou=h the follo/i!=ti.eli!e

Thi&* @u$&te&

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A" &e=$&*" the cl$i. fo& the thi&* -u$&te& of 200+' the t/o?e$& p&e"c&ipti(epe&io* "t$&te* to &u! o! 90 Septe.be& 200+' the clo"e of the t$3$ble-u$&te&) It e!*e* o! 90 Septe.be& 2006' pu&"u$!t to Sectio! 1124A5 of the17 T$3 Co*e) #i!*$!$o II >le* it" $*.i!i"t&$ti(e cl$i. o! 6 Octobe& 200,)

Thu"' "i!ce the $*.i!i"t&$ti(e cl$i. /$" >le* /ell /ithi! the t/o?e$&p&e"c&ipti(e pe&io*' the $*.i!i"t&$ti(e cl$i. fo& the thi&* -u$&te& of 200+

/$" ti.el? >le*) 4See ti.eli!e belo/5

%ou&th @u$&te&

Ke&e' the t/o?e$& p&e"c&ipti(e pe&io* i" cou!te* "t$&ti!= f&o. the clo"e ofthe fou&th -u$&te& /hich i" o! 91 Dece.be& 200+) The l$"t *$? of thep&e"c&ipti(e pe&io* fo& >li!= $! $pplic$tio! fo& t$3 &efu!*Gc&e*it /ith the CIR/$" o! 91 Dece.be& 2006) #i!*$!$o II >le* it" $*.i!i"t&$ti(e cl$i. /ith

the CIR o! 6 Octobe& 200,) Ke!ce' the cl$i." /e&e >le* o! ti.e' pu&"u$!tto Sectio! 1124A5 of the 17 T$3 Co*e) 4See ti.eli!e belo/5

II)

#INDANAO IIJS DICIAL CLAI#S WERE %ILED OT O% TI#E

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Not/ith"t$!*i!= the ti.el? >li!= of the $*.i!i"t&$ti(e cl$i."' /e >!* th$tthe CTA E! :$!c e&&e* i! hol*i!= th$t #i!*$!$o IIJ" u*ici$l cl$i." /e&eti.el? >le*)

A) 90D$? e&io* Al"o Applie" to Appe$l" f&o. I!$ctio!

Sectio! 1124D5 of the 17 T$3 Co*e "t$te" the ti.e &e-ui&e.e!t" fo& >li!=$ u*ici$l cl$i. fo& &efu!* o& t$3 c&e*it of i!put VAT

4D5 e&io* /ithi! /hich Refu!* o& T$3 C&e*it of I!put T$3e" "h$ll be #$*e) I! p&ope& c$"e"' the Co..i""io!e& "h$ll =&$!t $ &efu!* o& i""ue the t$3c&e*it ce&ti>c$te fo& c&e*it$ble i!put t$3e" /ithi! o!e hu!*&e* t/e!t? 41205*$?" f&o. the *$te of "ub.i""io! of co.plete *ocu.e!t" i! "uppo&t of the$pplic$tio! >le* i! $cco&*$!ce /ith Sub"ectio! 4A5 $!* 4:5 he&eof) I! c$"e of full o& p$&ti$l *e!i$l of the cl$i. fo& t$3 &efu!* o& t$3 c&e*it' o& the f$ilu&e o!the p$&t of the Co..i""io!e& to $ct o! the $pplic$tio! /ithi! the pe&io*p&e"c&ibe* $bo(e' the t$3p$?e& $Hecte* .$?' /ithi! thi&t? 4905 *$?" f&o.the &eceipt of the *eci"io! *e!?i!= the cl$i. o& $fte& the e3pi&$tio! of theo!e hu!*&e* t/e!t? *$?pe&io*' $ppe$l the *eci"io! o& the u!$cte* cl$i./ith the Cou&t of T$3 Appe$l") 4E.ph$"e" "upplie*5

Sectio! 1124D5 "pe$F" of t/o pe&io*" the pe&io* of 120 *$?"' /hich "e&(e"$" $ /$iti!= pe&io* to =i(e ti.e fo& the CIR to $ct o! the $*.i!i"t&$ti(ecl$i. fo& &efu!* o& c&e*it' $!* the pe&io* of 90 *$?"' /hich &efe&" to thepe&io* fo& i!te&po"i!= $! $ppe$l /ith the CTA) It i" /ith the 90*$? pe&io*

th$t the&e i" $! i""ue i! thi" c$"e)

The CTA E! :$!cJ" hol*i!= i" th$t' "i!ce the /o&* Po&P – $ *i"u!cti(e te&.th$t "i=!i>e" *i""oci$tio! $!* i!*epe!*e!ce of o!e thi!= f&o. $!othe& – i"u"e* i! Sectio! 1124D5' the t$3p$?e& i" =i(e! t/o optio!" 15 >le $! $ppe$l/ithi! 90 *$?" f&o. the CIRJ" *e!i$l of the $*.i!i"t&$ti(e cl$i. o& 25 >le $!$ppe$l /ith the CTA $fte& e3pi&$tio! of the 120*$? pe&io*' i! /hich c$"ethe 90*$? $ppe$l pe&io* *oe" !ot $ppl?) The u*ici$l cl$i. i" "e$"o!$bl?>le* "o lo!= $" it i" >le* $fte& the l$p"e of the 120*$? /$iti!= pe&io* butbefo&e the l$p"e of the t/o?e$& p&e"c&ipti(e pe&io* u!*e& Sectio! 1124A5)+6

We *o !ot $=&ee)

The 90*$? pe&io* $pplie" !ot o!l? to i!"t$!ce" of $ctu$l *e!i$l b? the CIRof the cl$i. fo& &efu!* o& t$3 c&e*it' but to c$"e" of i!$ctio! b? the CIR $"/ell) Thi" i" the co&&ect i!te&p&et$tio! of the l$/' $" hel* i! S$! Ro-ue+7

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Sectio! 1124C5+; $l"o e3p&e""l? =&$!t" the t$3p$?e& $ 90*$? pe&io* to$ppe$l to the CTA the *eci"io! o& i!$ctio! of the Co..i""io!e&' thu"

3 3 3 the t$3p$?e& $Hecte* .$?' /ithi! thi&t? 4905 *$?" f&o. the &eceipt ofthe *eci"io! *e!?i!= the cl$i. o& $fte& the e3pi&$tio! of the o!e hu!*&e*t/e!t? *$?pe&io*' $ppe$l the *eci"io! o& the u!$cte* cl$i. /ith the Cou&t

of T$3 Appe$l")

Thi" l$/ i" cle$&' pl$i!' $!* u!e-ui(oc$l) %ollo/i!= the /ell"ettle* (e&b$le=i" *oct&i!e' thi" l$/ "houl* be $pplie* e3$ctl? $" /o&*e* "i!ce it i" cle$&'pl$i!' $!* u!e-ui(oc$l) A" thi" l$/ "t$te"' the t$3p$?e& .$?' if he /i"he"'$ppe$l the *eci"io! of the Co..i""io!e& to the CTA /ithi! 90 *$?" f&o.&eceipt of the Co..i""io!e&" *eci"io!' o& if the Co..i""io!e& *oe" !ot $cto! the t$3p$?e&" cl$i. /ithi! the 120*$? pe&io*' the t$3p$?e& .$? $ppe$lto the CTA /ithi! 90 *$?" f&o. the e3pi&$tio! of the 120*$? pe&io*)4E.ph$"i" "upplie*5

The S$! Ro-ue p&o!ou!ce.e!t i" cle$&) The t$3p$?e& c$! >le the $ppe$l i!o!e of t/o /$?" 415 >le the u*ici$l cl$i. /ithi! thi&t? *$?" $fte& theCo..i""io!e& *e!ie" the cl$i. /ithi! the 120*$? pe&io*' o& 425 >le the

u*ici$l cl$i. /ithi! thi&t? *$?" f&o. the e3pi&$tio! of the 120*$? pe&io* ifthe Co..i""io!e& *oe" !ot $ct /ithi! the 120*$? pe&io*)

:) The u*ici$l Cl$i. W$" :el$te*l? %ile*

I! thi" c$"e' the f$ct" $&e !ot up fo& *eb$te) #i!*$!$o II >le* it"$*.i!i"t&$ti(e cl$i. fo& &efu!* o& c&e*it fo& the "eco!*' thi&*' $!* fou&th-u$&te&" of 200+ o! 6 Octobe& 200,) The CIR' the&efo&e' h$* $ pe&io* of 120*$?"' o& u!til 9 %eb&u$&? 2006' to $ct o! the cl$i.) The CIR' ho/e(e&' f$ile*to *o "o) #i!*$!$o II the! coul* t&e$t the i!$ctio! $" $ *e!i$l $!* $ppe$l itto the CTA /ithi! 90 *$?" f&o. 9 %eb&u$&? 2006' o& u!til , #$&ch 2006)

#i!*$!$o II' ho/e(e&' >le* $ etitio! fo& Re(ie/ o!l? o! 21 ul? 2006' 19;*$?" $fte& the l$p"e of the 90*$? pe&io* o! , #$&ch 2006) The u*ici$lcl$i. /$" the&efo&e >le* l$te) 4See ti.eli!e belo/)5

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C) The 90D$? e&io* to Appe$l i" #$!*$to&? $!* u&i"*ictio!$l

Ko/e(e&' /h$t i" up fo& *eb$te i" the !$tu&e of the 90*$? ti.e&e-ui&e.e!t) The CIR po"it" th$t it i" .$!*$to&?) #i!*$!$o II co!te!*" th$tthe &e-ui&e.e!t of u*ici$l &ecou&"e /ithi! 90 *$?" i" o!l? *i&ecto&? $!*pe&.i""i(e' $" i!*ic$te* b? the u"e of the /o&* P.$?P i! Sectio! 1124D5)+

The $!"/e& i" fou!* i! S$! Ro-ue) The&e' /e *ecl$&e* th$t the 90*$?pe&io* to $ppe$l i" both .$!*$to&? $!* u&i"*ictio!$l

Sectio! 1124C5 $l"o e3p&e""l? =&$!t" the t$3p$?e& $ 90*$? pe&io* to $ppe$lto the CTA the *eci"io! o& i!$ctio! of the Co..i""io!e&' thu"

3 3 3 the t$3p$?e& $Hecte* .$?' /ithi! thi&t? 4905 *$?" f&o. the &eceipt ofthe *eci"io! *e!?i!= the cl$i. o& $fte& the e3pi&$tio! of the o!e hu!*&e*t/e!t? *$?pe&io*' $ppe$l the *eci"io! o& the u!$cte* cl$i. /ith the Cou&t

of T$3 Appe$l") 4E.ph$"i" "upplie*5

Thi" l$/ i" cle$&' pl$i!' $!* u!e-ui(oc$l) %ollo/i!= the /ell"ettle* (e&b$le=i" *oct&i!e' thi" l$/ "houl* be $pplie* e3$ctl? $" /o&*e* "i!ce it i" cle$&'pl$i!' $!* u!e-ui(oc$l) A" thi" l$/ "t$te"' the t$3p$?e& .$?' if he /i"he"'$ppe$l the *eci"io! of the Co..i""io!e& to the CTA /ithi! 90 *$?" f&o.&eceipt of the Co..i""io!e&" *eci"io!' o& if the Co..i""io!e& *oe" !ot $cto! the t$3p$?e&" cl$i. /ithi! the 120*$? pe&io*' the t$3p$?e& .$? $ppe$lto the CTA /ithi! 90 *$?" f&o. the e3pi&$tio! of the 120*$? pe&io*)

3 3 3 3

Sectio! 1124A5 $!* 4C5 .u"t be i!te&p&ete* $cco&*i!= to it" cle$&' pl$i!' $!*u!e-ui(oc$l l$!=u$=e) The t$3p$?e& c$! >le hi" $*.i!i"t&$ti(e cl$i. fo&&efu!* o& c&e*it $t $!?ti.e /ithi! the t/o?e$& p&e"c&ipti(e pe&io*) If he >le"hi" cl$i. o! the l$"t *$? of the t/o?e$& p&e"c&ipti(e pe&io*' hi" cl$i. i" "till>le* o! ti.e) The Co..i""io!e& /ill h$(e 120 *$?" f&o. "uch >li!= to*eci*e the cl$i.) If the Co..i""io!e& *eci*e" the cl$i. o! the 120th *$?'

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o& *oe" !ot *eci*e it o! th$t *$?' the t$3p$?e& "till h$" 90 *$?" to >le hi" u*ici$l cl$i. /ith the CTA) Thi" i" !ot o!l? the pl$i! .e$!i!= but $l"o theo!l? lo=ic$l i!te&p&et$tio! of Sectio! 1124A5 $!* 4C5)

3 3 3 3

Whe! Sectio! 1124C5 "t$te" th$t Pthe t$3p$?e& $Hecte* .$?' /ithi! thi&t?4905 *$?" f&o. &eceipt of the *eci"io! *e!?i!= the cl$i. o& $fte& thee3pi&$tio! of the o!e hu!*&e* t/e!t?*$? pe&io*' $ppe$l the *eci"io! o& theu!$cte* cl$i. /ith the Cou&t of T$3 Appe$l"'P the l$/ *oe" !ot .$Fe the12090 *$? pe&io*" optio!$l u"t bec$u"e the l$/ u"e" the /o&* P .$?)P

The /o&* P.$?P "i.pl? .e$!" th$t the t$3p$?e& .$? o& .$? !ot $ppe$l the*eci"io! of the Co..i""io!e& /ithi! 90 *$?" f&o. &eceipt of the *eci"io!' o&/ithi! 90 *$?" f&o. the e3pi&$tio! of the 120*$? pe&io*) 3 3 3),0

D) E3ceptio! to the .$!*$to&? $!* u&i"*ictio!$l !$tu&e of the 12090 *$?pe&io* !ot $pplic$ble

Ne(e&thele""' S$! Ro-ue p&o(i*e" $! e3ceptio! to the .$!*$to&? $!* u&i"*ictio!$l !$tu&e of the 12090 *$? pe&io* :IR Ruli!= No) DA+;09*$te* 10 Dece.be& 2009) The :IR &uli!= *ecl$&e" th$t the Pt$3p$?e&cl$i.$!t !ee* !ot /$it fo& the l$p"e of the 120*$? pe&io* befo&e it coul*"eeF u*ici$l &elief /ith the CTA b? /$? of etitio! fo& Re(ie/)P

Althou=h #i!*$!$o II h$" !ot i!(oFe* the :IR &uli!=' /e *ee. it p&u*e!t $"

/ell $" !ece""$&? to */ell o! thi" i""ue to *ete&.i!e /hethe& thi" c$"e f$ll"u!*e& the e3ceptio!)

%o& thi" -ue"tio!' /e co.e b$cF to S$! Ro-ue' /hich p&o(i*e" th$t :IRRuli!= No) DA+;09 i" $ =e!e&$l i!te&p&et$ti(e &ule thu"' t$3p$?e&" c$!&el? o! it f&o. the ti.e of it" i""u$!ce o! 10 Dece.be& 2009 u!til it"&e(e&"$l b? thi" Cou&t i! Aichi o! 6 Octobe& 2010' /he! the 12090 *$?pe&io*" /e&e hel* to be .$!*$to&? $!* u&i"*ictio!$l) The Cou&t &e$"o!e* $"follo/"

T$3p$?e&" "houl* !ot be p&eu*ice* b? $! e&&o!eou" i!te&p&et$tio! b? theCo..i""io!e&' p$&ticul$&l? o! $ *i


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f&$u*' b$* f$ith o& .i"&ep&e"e!t$tio!' the &e(e&"$l b? thi" Cou&t of $ =e!e&$li!te&p&et$ti(e &ule i""ue* b? the Co..i""io!e&' liFe the &e(e&"$l of $ "peci>c:IR &uli!= u!*e& Sectio! 2+6' "houl* $l"o $ppl? p&o"pecti(el?) 3 3 3)

3 3 3 3

Thu"' the o!l? i""ue i" /hethe& :IR Ruli!= No) DA+;09 i" $ =e!e&$li!te&p&et$ti(e &ule $pplic$ble to $ll t$3p$?e&" o& $ "peci>c &uli!= $pplic$bleo!l? to $ p$&ticul$& t$3p$?e&)

:IR Ruli!= No) DA+;09 i" $ =e!e&$l i!te&p&et$ti(e &ule bec$u"e it /$" $&e"po!"e to $ -ue&? .$*e' !ot b? $ p$&ticul$& t$3p$?e&' but b? $=o(e&!.e!t $=e!c? t$"Fe* /ith p&oce""i!= t$3 &efu!*" $!* c&e*it"' th$t i"'the O!e Stop Shop I!te&A=e!c? T$3 C&e*it $!* D&$/b$cF Ce!te& of theDep$&t.e!t of %i!$!ce ) Thi" =o(e&!.e!t $=e!c? i" $l"o the $**&e""ee' o&the e!tit? &e"po!*e* to' i! :IR Ruli!= No) DA+;09) Thu"' /hile thi"=o(e&!.e!t $=e!c? .e!tio!" i! it" -ue&? to the Co..i""io!e& the$*.i!i"t&$ti(e cl$i. of L$i :$? Re"ou&ce" De(elop.e!t' I!c)' the $=e!c?/$" i! f$ct $"Fi!= the Co..i""io!e& /h$t to *o i! c$"e" liFe the t$3 cl$i.of L$i :$? Re"ou&ce" De(elop.e!t' I!c)' /he&e the t$3p$?e& *i* !ot /$itfo& the l$p"e of the 120*$? pe&io*)

Cle$&l?' :IR Ruli!= No) DA+;09 i" $ =e!e&$l i!te&p&et$ti(e &ule) Thu"' $llt$3p$?e&" c$! &el? o! :IR Ruli!= No) DA+;09 f&o. the ti.e of it" i""u$!ceo! 10 Dece.be& 2009 up to it" &e(e&"$l b? thi" Cou&t i! Aichi o! 6 Octobe&

2010' /he&e thi" Cou&t hel* th$t the 12090 *$? pe&io*" $&e .$!*$to&?$!* u&i"*ictio!$l),1

Thu"' i! S$! Ro-ue' the Cou&t $pplie* thi" e3ceptio! to T$=$!ito #i!i!=Co&po&$tio! 4T$=$!ito5' o!e of the t$3p$?e&" i! S$! Ro-ue) T$=$!ito >le* it"

u*ici$l cl$i. o! 1+ %eb&u$&? 2007' $fte& the :IR &uli!= tooF eHect o! 10Dece.be& 2009 $!* befo&e the p&o.ul=$tio! of #i&$!t) The Cou&t "t$te*

T$=$!ito' ho/e(e&' >le* it" u*ici$l cl$i. /ith the CTA o! 1+ %eb&u$&? 2007'$fte& the i""u$!ce of :IR Ruli!= No) DA+;09 o! 10 Dece.be& 2009) T&ul?'

T$=$!ito c$! cl$i. th$t i! >li!= it" u*ici$l cl$i. p&e.$tu&el? /ithout /$iti!=fo& the 120*$? pe&io* to e3pi&e' it /$" .i"le* b? :IR Ruli!= No) DA+;09)

Thu"' T$=$!ito c$! cl$i. the be!e>t of :IR Ruli!= No) DA+;09' /hich"hiel*" the >li!= of it" u*ici$l cl$i. f&o. the (ice of p&e.$tu&it?) ,2

S$! Ro-ue /$" $l"o c$&eful to poi!t out th$t the :IR &uli!= *oe" !ot&et&o$cti(el? $ppl? to p&e.$tu&e u*ici$l cl$i." >le* befo&e the i""u$!ce ofthe :IR &uli!=

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Ko/e(e&' :IR Ruli!= No) DA+;09 c$!!ot be =i(e! &et&o$cti(e eHect fo&fou& &e$"o!" >&"t' it i" $*.itte*l? $! e&&o!eou" i!te&p&et$tio! of the l$/"eco!*' p&io& to it" i""u$!ce' the :IR hel* th$t the 120*$? pe&io* /$".$!*$to&? $!* u&i"*ictio!$l' /hich i" the co&&ect i!te&p&et$tio! of the l$/thi&*' p&io& to it" i""u$!ce' !o t$3p$?e& c$! cl$i. th$t it /$" .i"le* b? the:IR i!to >li!= $ u*ici$l cl$i. p&e.$tu&el? $!* fou&th' $ cl$i. fo& t$3 &efu!*

o& c&e*it' liFe $ cl$i. fo& t$3 e3e.ptio!' i" "t&ictl? co!"t&ue* $=$i!"t thet$3p$?e&),9

Thu"' S$! Ro-ue hel* th$t t$3p$?e& S$! Ro-ue o/e& Co&po&$tio!' coul* !ot"eeF &efu=e i! the :IR &uli!= $" it u.pe* the =u! /he! it >le* it" u*ici$lcl$i. o! 10 Ap&il 2009' p&io& to the i""u$!ce of the :IR &uli!= o! 10Dece.be& 2009)1âwphi1 The Cou&t "t$te*

S$! Ro-ue' the&efo&e' c$!!ot be!e>t f&o. :IR Ruli!= No) DA+;09bec$u"e it >le* it" u*ici$l cl$i. p&e.$tu&el? o! 10 Ap&il 2009' befo&e thei""u$!ce of :IR Ruli!= No) DA+;09 o! 10 Dece.be& 2009) To &epe$t' S$!Ro-ue c$!!ot cl$i. th$t it /$" .i"le* b? the :IR i!to >li!= it" u*ici$l cl$i.p&e.$tu&el? bec$u"e :IR Ruli!= No) DA+;09 /$" i""ue* o!l? $fte& S$!Ro-ue >le* it" u*ici$l cl$i.) At the ti.e S$! Ro-ue >le* it" u*ici$l cl$i.'the l$/ $" $pplie* $!* $*.i!i"te&e* b? the :IR /$" th$t the Co..i""io!e&h$* 120 *$?" to $ct o! $*.i!i"t&$ti(e cl$i.") Thi" /$" i! f$ct the po"itio! ofthe :IR p&io& to the i""u$!ce of :IR Ruli!= No) DA+;09) I!*ee*' S$!Ro-ue !e(e& cl$i.e* the be!e>t of :IR Ruli!= No) DA+;09 o& R#C +09'/hethe& i! thi" Cou&t' the CTA' o& befo&e the Co..i""io!e&),+

S$! Ro-ue liFe/i"e &ule* out the $pplic$tio! of the :IR &uli!= to c$"e" ofl$te >li!=) The Cou&t hel* th$t the :IR &uli!=' $" $! e3ceptio! to the.$!*$to&? $!* u&i"*ictio!$l !$tu&e of the 12090 *$? pe&io*"' i" li.ite* top&e.$tu&e >li!= $!* *oe" !ot e3te!* to l$te >li!= of $ u*ici$l cl$i.) Thu"'the Cou&t fou!* th$t "i!ce hile3 #i!i!= Co&po&$tio!' the othe& p$&t? i! theco!"oli*$te* c$"e S$! Ro-ue' >le* it" cl$i. +26 *$?" $fte& the l$p"e of the90*$? pe&io*' it coul* !ot $($il it"elf of the be!e>t of the :IR &uli!=

hile3J" "itu$tio! i" !ot $ c$"e of p&e.$tu&e >li!= of it" u*ici$l cl$i. but ofl$te >li!=' i!*ee*

Ve&? l$te >li!=) :IR Ruli!= No) DA+;09 $llo/e* p&e.$tu&e >li!= of $ u*ici$l cl$i.' /hich .e$!" !o!e3h$u"tio! of the 120*$? pe&io* fo& theCo..i""io!e& to $ct o! $! $*.i!i"t&$ti(e cl$i.) hile3 c$!!ot cl$i. thebe!e>t of :IR Ruli!= No) DA+;09 bec$u"e hile3 *i* !ot >le it" u*ici$lcl$i. p&e.$tu&el? but >le* it lo!= $fte& the l$p"e of the 90*$? pe&io*

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E) !*e&"i=!e* *i""e!te* i! S$! Ro-ue to the &et&o$cti(e $pplic$tio! of the.$!*$to&? $!* u&i"*ictio!$l !$tu&e of the 12090 *$? pe&io*)

It i" /o&th? to !ote th$t i! S$! Ro-ue' thi" po!e!te &e=i"te&e* he& *i""e!t tothe &et&o$cti(e $pplic$tio! of the .$!*$to&? $!* u&i"*ictio!$l !$tu&e of the12090 *$? pe&io* p&o(i*e* u!*e& Sectio! 1124D5 of the T$3 Co*e /hich' i!

he& (ie/' i" u!f$i& to t$3p$?e&") It h$" bee! the (ie/ of thi" po!e!te th$tthe .$!*$to&? !$tu&e of 12090 *$? pe&io* .u"t be co.pletel? $pplie*p&o"pecti(el? o&' $t the e$&lie"t' o!l? upo! the >!$lit? of Aichi i! o&*e& toc&e$te "t$bilit? $!* co!"i"te!c? i! ou& t$3 l$/") Ne(e&thele""' thi" po!e!tei" .i!*ful of the f$ct th$t u*ici$l p&ece*e!t" c$!!ot be i=!o&e*) Ke!ce' the.$o&it? (ie/ e3p&e""e* i! S$! Ro-ue .u"t be $pplie*)

S##ARB O% RLES ON RESCRITIVE ERIODS %OR CLAI#IN8 RE%ND ORCREDIT O% INT VAT

The le""o!" of thi" c$"e .$? be "u..e* up $" follo/"

A) T/oBe$& &e"c&ipti(e e&io*

1) It i" o!l? the $*.i!i"t&$ti(e cl$i. th$t .u"t be >le* /ithi! the t/o?e$& p&e"c&ipti(e pe&io*) 4Aichi5 2) The p&ope& &ecFo!i!= *$te fo& thet/o?e$& p&e"c&ipti(e pe&io* i" the clo"e of the t$3$ble -u$&te& /he!the &ele($!t "$le" /e&e .$*e) 4S$! Ro-ue5

9) The o!l? othe& &ule i" the Atl$" &uli!=' /hich $pplie* o!l? f&o. ; u!e2007 to 12 Septe.be& 200;) Atl$" "t$te" th$t the t/o?e$& p&e"c&ipti(epe&io* fo& >li!= $ cl$i. fo& t$3 &efu!* o& c&e*it of u!utilie* i!put VATp$?.e!t" "houl* be cou!te* f&o. the *$te of >li!= of the VAT &etu&!$!* p$?.e!t of the t$3) 4S$! Ro-ue5

:) 12090 D$? e&io*

1) The t$3p$?e& c$! >le $! $ppe$l i! o!e of t/o /$?" 415 >le the u*ici$l cl$i. /ithi! thi&t? *$?" $fte& the Co..i""io!e& *e!ie" the

cl$i. /ithi! the 120*$? pe&io*' o& 425 >le the u*ici$l cl$i. /ithi!thi&t? *$?" f&o. the e3pi&$tio! of the 120*$? pe&io* if theCo..i""io!e& *oe" !ot $ct /ithi! the 120*$? pe&io*)

2) The 90*$? pe&io* $l/$?" $pplie"' /hethe& the&e i" $ *e!i$l o&i!$ctio! o! the p$&t of the CIR)

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9) A" $ =e!e&$l &ule' the 9 0*$? pe&io* to $ppe$l i" both .$!*$to&?$!* u&i"*ictio!$l) 4Aichi $!* S$! Ro-ue5

+) A" $! e3ceptio! to the =e!e&$l &ule' p&e.$tu&e >li!= i" $llo/e* o!l?if >le* bet/ee! 10 Dece.be& 2009 $!* , Octobe& 2010' /he! :IRRuli!= No) DA+;09 /$" "till i! fo&ce) 4S$! Ro-ue5

,) L$te >li!= i" $b"olutel? p&ohibite*' e(e! *u&i!= the ti.e /he! :IRRuli!= No) DA+;09 /$" i! fo&ce) 4S$! Ro-ue5

S##ARB AND CONCLSION

I! "u.' ou& >!*i!= i" th$t the th&ee $*.i!i"t&$ti(e cl$i." fo& the &efu!* o&c&e*it of u!utilie* i!put VAT /e&e $ll ti.el? >le*' /hile the co&&e"po!*i!=

u*ici$l cl$i." /e&e bel$te*l? >le*)

The fo&e=oi!= co!"i*e&e*' the CT A lo"t u&i"*ictio! o(e& #i!*$!$o IlJ"cl$i." fo& &efu!* o& c&e*it)1âwphi1 The CTA E: e&&e* i! =&$!ti!= the"ecl$i.")

WKERE%ORE' /e 8RANT the etitio!) The $""$ile* Cou&t of T$3 Appe$l" E!:$!c Deci"io! *$te* 11 No(e.be& 200 $!* Re"olutio! *$te* 9 #$&ch 2010of the i! CTA E: C$"e No) ++; 4CTA C$"e No) 7,075 $&e he&eb? REVERSED$!* SET ASIDE) A !e/ &uli!= i" e!te&e* DENBIN8 &e"po!*e!t " cl$i. fo& $t$3 &efu!* o& c&e*it of6'71';+,)2+)

SO ORDERED)

ECON" "I!ISION

COMMISSIONER OFINTERNA RE!ENUE,

etitio!e&'

(e&"u"

G.R. No. 1$8%9$

&e"e!t CARIO' J)' Chairperson'LEONARDODE CASTRO'

ERALTA'A:AD' $!*#ENDOMA' JJ.

22

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SON& P#IIPPINES,INC.,

Re"po!*e!t)

&o.ul=$te*No(e.be& 17' 2010

X X

" E C I S I O N MEN"O'A, J.(

Thi" petitio! fo& &e(ie/ o! certiorari "eeF" to "et $"i*e the #$? 17'

2007 Deci"io! $!* the ul? ,' 2007 Re"olutio! of the Cou&t of T$3 Appe$l" E!

:$!c

1U

(CTA-EB), i! C)T)A) E: No) 0' $cie!c? $""e"".e!t fo& e3p$!*e* /ithhol*i!=

t$3 (ET) i! the $.ou!t of 1'09,';7)70 $!* the pe!$ltie" fo& l$te

&e.itt$!ce of i!te&!$l &e(e!ue t$3e" i! the $.ou!t of 1'26' ,9)0)9U

T#E FACTS

O! No(e.be& 2+' 1;' the CIR i""ue* Lette& of Autho&it? No)

0000179+ (!"A 1#$%&) $utho&ii!= ce&t$i! &e(e!ue ocie!c? t$3e" $!* pe!$ltie" /$"

i""ue* b? the CIR /hich So!? p&ote"te*) The&e$fte&' $cti!= o! the p&ote"t'

the CIR i""ue* >!$l $""e"".e!t !otice"' the fo&.$l lette& of *e.$!* $!* the

*et$il" of *i"c&ep$!cie")+U S$i* *et$il" of the *e>cie!c? t$3e" $!* pe!$ltie"

fo& l$te &e.itt$!ce of i!te&!$l &e(e!ue t$3e" $&e $" follo/""EFICIENC& !AUE A""E"TA3 !AT A+6+n) No. ST!AT9$01242000 :$"ic T$3 Due 7',;'700)

29

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00

A** e!$ltie"

I!te&e"t up to 9912000 9'1,7'91

+)+1

Co.p&o.i"e

2,'000)0

0

9'1;2'91+)

+1

De>cie!c? VAT Due 11'1+1'01+

)+1

"EFICIENC& E3PAN"E"7IT##O"ING TA3 E7T A+6+n) No. STE7T9$01252000

:$"ic T$3 Due

1'+16'76)

0A** e!$ltie"

I!te&e"t up to 9912000 ,,0'+;,)

;2

Co.p&o.i"e2,'000)0

0 ,7,'+;,);2

De>cie!c? EWT Due 1'2'+62)

72

"EFICIENC& OF !AT ONRO&AT& PA&MENTS A+6+n) No. STR19$012%2000

:$"ic T$3 Due

A** e!$ltie"

Su&ch$&=e 9,'177)

;0

I!te&e"t up to 9912000;7',;0)9

+

Co.p&o.i"e16'000)0

0 +62'7,;)1+

e!$ltie" Due +62'7,;)1+

ATE REMITTANCE OF FINA

2+


25/100


7IT##O"ING TA3A+6+n) No. STR29$012$2000

:$"ic T$3 Due

A** e!$ltie"

Su&ch$&=e 1'72'6

0)71

I!te&e"t up to 9912000,0;'7;9)

07

Co.p&o.i"e,0'000)0

02'2;;'+79)

7;

e!$ltie" Due 2'2;;'+79)

7;

ATE REMITTANCE OFINCOME PA&MENTS A+6+n) No. STR9$01282000

:$"ic T$3 Due

A** e!$ltie"

2, Su&ch$&=e ;';6,)9+

I!te&e"t up to 9912000 ,;)2

Co.p&o.i"e 2'000)00 10'29)60e!$ltie" Due 10'29)60

GRAN" TOTA 15,895,%

2.%5,U

So!? "ou=ht &ee($lu$tio! of the $fo&e.e!tio!e* $""e"".e!t b? >li!=

$ p&ote"t o! %eb&u$&? 2' 2000) So!? "ub.itte* &ele($!t *ocu.e!t" i!

"uppo&t of it" p&ote"t o! the 16th of th$t "$.e .o!th)6U

2,

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O! Octobe& 2+' 2000' /ithi! 90 *$?" $fte& the l$p"e of 1;0 *$?" f&o.

"ub.i""io! of the "$i* "uppo&ti!= *ocu.e!t" to the CIR' So!? >le* $

petitio! fo& &e(ie/ befo&e the CTA)7U

Afte& t&i$l' the CTA%i&"t Di(i"io! *i"$llo/e* the *e>cie!c? VAT

$""e"".e!t bec$u"e the "ub"i*ie* $*(e&ti"i!= e3pe!"e p$i* b? So!? /hich/$" *ul? co(e&e* b? $ VAT i!(oice &e"ulte* i! $! i!put VAT c&e*it) A"

&e=$&*" the EWT' the CTA%i&"t Di(i"io! .$i!t$i!e* the *e>cie!c? EWT

$""e"".e!t o! So!?" .oto& (ehicle" $!* o! p&ofe""io!$l fee" p$i* to

=e!e&$l p&ofe""io!$l p$&t!e&"hip") It $l"o $""e""e* the $.ou!t" p$i* to

"$le" $=e!t" $" co..i""io!" /ith >(e pe&ce!t 4,5 EWT pu&"u$!t to

Sectio! 14=5 of Re(e!ue Re=ul$tio!" No) 6;,) The CTA%i&"t Di(i"io!'

ho/e(e&' *i"$llo/e* the EWT $""e"".e!t o! &e!t$l e3pe!"e "i!ce it fou!*

th$t the tot$l &e!t$l *epo"it of 10',29';21) /$" i!cu&&e* f&o. $!u$&? to

#$&ch 1; /hich /$" $=$i! be?o!* the co(e&$=e of LOA 179+) E3cept fo&the co.p&o.i"e pe!$ltie"' the CTA%i&"t Di(i"io! $l"o uphel* the pe!$ltie"

fo& the l$te p$?.e!t of VAT o! &o?$ltie"' fo& l$te &e.itt$!ce of >!$

/ithhol*i!= t$3 o! &o?$lt? $" of Dece.be& 17 $!* fo& the l$te &e.itt$!ce

of EWT b? "o.e of So!?" b&$!che");U I! "u.' the CTA%i&"t Di(i"io! p$&tl?

=&$!te* So!?" petitio! b? c$!celli!= the *e>cie!c? VAT $""e"".e!t but

uphel* $ .o*i>e* *e>cie!c? EWT $""e"".e!t $" /ell $" the

pe!$ltie") Thu"' the *i"po"iti(e po&tio! &e$*"

WKERE%ORE' the petitio! fo& &e(ie/ i" he&eb? ARTIALLB8RANTED) Re"po!*e!t i" ORDERED to CANCEL $!* WITKDRAWthe *e>cie!c? $""e"".e!t fo& ($lue$**e* t$3 fo& 17 fo& l$cF of .e&it) Ko/e(e&' the *e>cie!c? $""e"".e!t" fo& e3p$!*e*/ithhol*i!= t$3 $!* pe!$ltie" fo& l$te &e.itt$!ce of i!te&!$l&e(e!ue t$3e" $&e KELD)

Acco&*i!=l?' petitio!e& i" DIRECTED to AB the &e"po!*e!tthe *e>cie!c? e3p$!*e* /ithhol*i!= t$3 i! the $.ou!tof 1'09,';7)70 $!* the follo/i!= pe!$ltie" fo& l$te &e.itt$!ce of

i!te&!$l &e(e!ue t$3e" i! the "u. of1'26',9)0

1) VAT o! Ro?$lt? +2'2+2)072) Withhol*i!= T$3 o! Ro?$lt? ;91'+2;)209) EWT of etitio!e&" :&$!che" ;'29)69

Tot$l 1'26',9)0

26



27/100


lu" 20 *eli!-ue!c? i!te&e"t f&o. $!u$&? 17' 2000 u!til full?p$i* pu&"u$!t to Sectio! 2+4C5495 of the 17 T$3 Co*e)

SO ORDERED)U

The CIR "ou=ht $ &eco!"i*e&$tio! of the $bo(e *eci"io! $!* "ub.itte*

the follo/i!= =&ou!*" i! "uppo&t the&eof

A) The Ko!o&$ble Cou&t co..itte* &e(e&"ible e&&o& i! hol*i!=

th$t petitio!e& i" !ot li$ble fo& the *e>cie!c? VAT i! the$.ou!t of 11'1+1'01+)+1

:) The Ko!o&$ble cou&t co..itte* &e(e&"ible e&&o& i! hol*i!=

th$t the co..i""io! e3pe!"e i! the $.ou!t of 2';+'77)00 "houl* be "ubecte* to , /ithhol*i!= t$3

i!"te$* of the 10 t$3 &$te

C) The Ko!o&$ble Cou&t co..itte* $ &e(e&"ible e&&o& i!hol*i!= th$t the /ithhol*i!= t$3 $""e"".e!t /ith &e"pect tothe , /ithhol*i!= t$3 o! &e!t$l *epo"it i! the $.ou!tof 10',29';21) "houl* be c$!celle* $!*

D) The Ko!o&$ble Cou&t co..itte* &e(e&"ible e&&o& i! hol*i!=

th$t the &e.itt$!ce of >!$l /ithhol*i!= t$3 o! &o?$ltie"

co(e&i!= the pe&io* $!u$&? to #$&ch 1; /$" >le* o! ti.e)10U

O! Ap&il 2;' 200,' the CTA%i&"t Di(i"io! *e!ie* the .otio! fo&

&eco!"i*e&$tio!) !f$e*' the CIR >le* $ petitio! fo& &e(ie/ /ith the CTAE:

&$i"i!= i*e!tic$l i""ue" 1) Whethe& o& !ot &e"po!*e!t 4So!?5 i" li$ble fo& the

*e>cie!c? VAT i! the $.ou!t of 11'1+1'01+)+1

2) Whethe& o& !ot the co..i""io! e3pe!"e i! the $.ou!t

of 2';+'77)00 "houl* be "ubecte* to 10 /ithhol*i!= t$3i!"te$* of the , t$3 &$te

9) Whethe& o& !ot the /ithhol*i!= $""e"".e!t /ith &e"pect to

the , /ithhol*i!= t$3 o! &e!t$l *epo"it i! the $.ou!tof 10',29';21) i" p&ope& $!*

27



28/100


+) Whethe& o& !ot the &e.itt$!ce of >!$l /ithhol*i!= t$3 o!

&o?$ltie" co(e&i!= the pe&io* $!u$&? to #$&ch 1; /$" >le*out"i*e of ti.e)11U

%i!*i!= !o co=e!t &e$"o! to &e(e&"e the *eci"io! of the CTA%i&"t

Di(i"io!' the CTAE: *i".i""e* CIR" petitio! o! #$? 17' 2007) CIR" .otio!

fo& &eco!"i*e&$tio! /$" *e!ie* b? the CTAE: o! ul? ,' 2007)

The CIR i" !o/ befo&e thi" Cou&t (i$ thi" petitio! fo& &e(ie/ &el?i!= o!

the (e&? "$.e =&ou!*" it &$i"e* befo&e the CTA%i&"t Di(i"io! $!* the CTA

E:) The "$i* =&ou!*" $&e &ep&o*uce* belo/

GROUN"S FOR T#E AO7ANCE OF T#E PETITION

I T#E CTA EN ANC ERRE" IN RUING T#AT

RESPON"ENT IS NOT IAE FOR "EFICIENC& !AT IN T#EAMOUNT OF P#P11,141,014.41.

II

AS TO RESPON"ENTS "EFICIENC& E3PAN"E"

7IT##O"ING TA3 IN T#E AMOUNT OF P#P1,992,4%2.$2(

A. T#E CTA EN ANC ERRE" IN RUING T#AT T#ECOMMISSION E3PENSE IN T#E AMOUNT OFP#P2,894,$9$.00 S#OU" E SUJECTE" TO A7IT##O"ING TA3 OF 5: INSTEA" OF T#E 10: TA3RATE.

. T#E CTA EN ANC ERRE" IN RUING T#AT T#E

ASSESSMENT 7IT# RESPECT TO T#E 5: 7IT##O"INGTA3 ON RENTA "EPOSIT IN T#E AMOUNT OFP#P10,52,821.99 IS NOT PROPER.

III

2;

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T#E CTA EN ANC ERRE" IN RUING T#AT T#E FINA7IT##O"ING TA3 ON RO&ATIES CO!ERING T#E PERIO" JANUAR& TO MARC# 1998 7AS FIE" ON TIME.;12<

po! >li!= of So!?" co..e!t' the Cou&t o&*e&e* the CIR to >le it"

&epl? the&eto) The CIR "ub"e-ue!tl? >le* $ .$!ife"t$tio! i!fo&.i!= the

Cou&t th$t it /oul* !o lo!=e& >le $ &epl?) Thu"' o! Dece.be& 9' 200;' the

Cou&t &e"ol(e* to =i(e *ue cou&"e to the petitio! $!* to *eci*e the c$"e o!

the b$"i" of the ple$*i!=" >le*)19U

The Cou&t >!*" !o .e&it i! the petitio!)

The CIR i!"i"t" th$t LOA 179+' $lthou=h it "t$te" the pe&io* 17 $!*

u!(e&i>e* p&io& ?e$&"' "houl* be u!*e&"too* to .e$! the >"c$l ?e$& e!*i!=

i! #$&ch 91' 1;)1+U The Cou&t c$!!ot $=&ee)

:$"e* o! Sectio! 19 of the T$3 Co*e' $ Lette& of Autho&it? o& LOA i" the

$utho&it? =i(e! to the $pp&op&i$te &e(e!ue o any )aDay+r. 3 3 3 E.ph$"e" "upplie*U

Cle$&l?' the&e .u"t be $ =&$!t of $utho&it? befo&e $!? &e(e!ue o


30/100


&e(e!ue oe*

p&io& ?e$&") %o& "$i* &e$"o!' the CIR $cti!= th&ou=h it" &e(e!ue oc$ll? i!*ic$te*

i! the LGA)16U E.ph$"i" "upplie*U

O! thi" poi!t $lo!e' the *e>cie!c? VAT $""e"".e!t "houl* h$(e bee!

*i"$llo/e*) :e th$t $" it .$?' the CIR" $&=u.e!t' th$t So!?" $*(e&ti"i!=

e3pe!"e coul* !ot be co!"i*e&e* $" $! i!put VAT c&e*it bec$u"e the "$.e

/$" e(e!tu$ll? &ei.bu&"e* b? So!? I!te&!$tio!$l Si!=$po&e (SIS), i" $l"o

e&&o!eou")

The CIR co!te!*" th$t "i!ce So!?" $*(e&ti"i!= e3pe!"e /$"

&ei.bu&"e* b? SIS' the fo&.e& !e(e& i!cu&&e* $!? $*(e&ti"i!= e3pe!"e) A" $

&e"ult' So!? i" !ot e!title* to $ t$3 c&e*it) At .o"t' the CIR co!ti!ue"' the

"$i* $*(e&ti"i!= e3pe!"e "houl* be fo& the $ccou!t of SIS' $!* !ot So!?)17U

The Cou&t i" !ot pe&"u$*e*) A" $ptl? fou!* b? the CTA%i&"t Di(i"io!

$!* l$te& $


31/100


u!*e& Sectio! 1101U of the 17 T$3 Co*e th$t $! $*(e&ti"i!= e3pe!"e *ul?

co(e&e* b? $ VAT i!(oice i" $ le=iti.$te bu"i!e"" e3pe!"e) Thi" i" co!>&.e*

b? !o le"" th$! CIR" o/! /it!e""' Re(e!ue O!itel? !ot ch$!=e "$i* f$ct)

The CIR fu&the& $&=ue" th$t So!? it"elf $*.itte* th$t the

&ei.bu&"e.e!t f&o. SIS /$" i!co.e $!*' thu"' t$3$ble) I! "uppo&t of thi"'

the CIR cite* $ po&tio! of So!?" p&ote"t >le* befo&e it

The f$ct th$t *ue to $*(e&"e eco!o.ic co!*itio!"' So!?

Si!=$po&e h$" =&$!te* to ou& clie!t $ "ub"i*? e-ui($le!t to thel$tte&" $*(e&ti"i!= e3pe!"e" /ill !ot $Hect the ($li*it? of the i!putt$3e" f&o. "uch e3pe!"e") Thu"' $t the .o"t' thi" i" $! $**itio!$li!co.e of ou& clie!t "ubect to i!co.e t$3) We "ub.it fu&the& th$tou& clie!t i" !ot "ubect to VAT o! the "ub"i*? i!co.e $" thi" /$"!ot *e&i(e* f&o. the "$le of =oo*" o& "e&(ice")22U

I!"of$& $" the $bo(e.e!tio!e* "ub"i*? .$? be co!"i*e&e* $" i!co.e

$!*' the&efo&e' "ubect to i!co.e t$3' the Cou&t $=&ee") Ko/e(e&' the Cou&t

*oe" !ot $=&ee th$t the "$.e "ub"i*? "houl* be "ubect to the 10 VAT) Tobe=i! /ith' the "$i* "ub"i*? te&.e* b? the CIR $" &ei.bu&"e.e!t /$" !ot

e(e! e3clu"i(el? e$&.$&Fe* fo& So!?" $*(e&ti"i!= e3pe!"e fo& it /$" but $!

$""i"t$!ce o& $i* i! (ie/ of So!?" *i&e o& $*(e&"e eco!o.ic co!*itio!"' $!*

/$" o!l? e-ui($le!t to the l$tte&" 4So!?"5 $*(e&ti"i!= e3pe!"e")

Sectio! 106 of the T$3 Co*e e3pl$i!" /he! VAT .$? be i.po"e* o&

e3$cte*) Thu"

SEC) 106) !aBu+a+ TaD on SaB+ o> Goo orPro+r)-+.

4A5 R$te $!* :$"e of T$3) The&e "h$ll be le(ie*' $""e""e* $!*

collecte* o! e(e&? "$le' b$&te& o& e3ch$!=e of =oo*" o&p&ope&tie"' ($lue$**e* t$3 e-ui($le!t to te! pe&ce!t 4105 of the =&o"" "elli!= p&ice o& =&o"" ($lue i! .o!e? of the =oo*" o&

91

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p&ope&tie" "ol*' b$&te&e* o& e3ch$!=e*' "uch t$3 to be p$i* b? the"elle& o& t&$!"fe&o&)

Thu"' the&e .u"t be $ "$le' b$&te& o& e3ch$!=e of =oo*" o& p&ope&tie"

befo&e $!? VAT .$? be le(ie*) Ce&t$i!l?' the&e /$" !o "uch "$le' b$&te& o&

e3ch$!=e i! the "ub"i*? =i(e! b? SIS to So!?) It /$" but $ *ole out b? SIS$!* !ot i! p$?.e!t fo& =oo*" o& p&ope&tie" "ol*' b$&te&e* o& e3ch$!=e* b?

So!?)

I! the c$"e of CIR . Co*rt o+ Appeas (CA)'29U the Cou&t h$* the

occ$"io! to &ule th$t "e&(ice" &e!*e&e* fo& $ fee e(e! o! &ei.bu&"e.e!to!

co"t b$"i" o!l? $!* /ithout &e$lii!= p&o>t $&e $l"o "ubect to VAT) The c$"e'

ho/e(e&' i" !ot $pplic$ble to the p&e"e!t c$"e) I! th$t c$"e' CO#ASERCO

&e!*e&e* "e&(ice to it" $t) Thi" i" !ot t&ue i! the p&e"e!t c$"e)

So!? *i* !ot &e!*e& $!? "e&(ice to SIS $t $ll) The "e&(ice" &e!*e&e* b? the

$*(e&ti"i!= co.p$!ie"' p$i* fo& b? So!? u"i!= SIS *oleout' /e&e fo& So!?

$!* !ot SIS) SIS u"t =$(e $""i"t$!ce to So!? i! the $.ou!t e-ui($le!t to

the l$tte&" $*(e&ti"i!= e3pe!"e but !e(e& &ecei(e* $!? =oo*"' p&ope&tie" o&

"e&(ice f&o. So!?)

Re=$&*i!= the *e>cie!c? EWT $""e"".e!t' .o&e p$&ticul$&l? So!?"

co..i""io! e3pe!"e' the CIR i!"i"t" th$t "$i* *e>cie!c? EWT $""e"".e!t i"

"ubect to the te! pe&ce!t 4105 &$te i!"te$* of the >(e pe&ce!t 4,5 citi!=

Re(e!ue Re=ul$tio! No) 2; *$te* Ap&il 17' 1;)2+U The "$i* &e(e!ue

&e=ul$tio! p&o(i*e" th$t the 10 &$te i" $pplie* /he! the &ecipie!t of the

co..i""io! i!co.e i" $ !$tu&$l pe&"o!) Acco&*i!= to the CIR' So!?"

"che*ule of Selli!=' 8e!e&$l $!* A*.i!i"t&$ti(e e3pe!"e" "ho/" the

co..i""io! e3pe!"e $" co..i""io!G*e$le& "$le".$! i!ce!ti(e'

e.ph$"ii!= the /o&* "$le".$!)

O! the othe& h$!*' the $pplic$tio! of the >(e pe&ce!t 4,5 &$te b? the

CTA%i&"t Di(i"io! i" b$"e* o! Sectio! 14=5 of Re(e!ue Re=ul$tio!" No) 6;,

/hich p&o(i*e"

4=5 A.ou!t" p$i* to ce&t$i! :&oFe&" $!* A=e!t") O! =&o""p$?.e!t" to cu"to."' i!"u&$!ce' &e$l e"t$te $!* co..e&ci$l

92



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b&oFe&" $!* $=e!t" of p&ofe""io!$l e!te&t$i!e&" >(e pe& ce!tu.4,5)2,U

I! *e!?i!= the (e&? "$.e $&=u.e!t of the CIR i! it" .otio! fo&

&eco!"i*e&$tio!' the CTA%i&"t Di(i"io!' hel*

3 3 3' co..i""io! e3pe!"e i" i!*ee* "ubect to 10/ithhol*i!= t$3 but p$?.e!t" .$*e to b&oFe& i" "ubect to ,/ithhol*i!= t$3 pu&"u$!t to Sectio! 14=5 of Re(e!ue Re=ul$tio!"No) 6;,) While the co..i""io! e3pe!"e i! the "che*ule of Selli!=' 8e!e&$l $!* A*.i!i"t&$ti(e e3pe!"e" "ub.itte* b?petitio!e& 4SI5 to the :IR i" c$ptio!e* $" co..i""io!G*e$le&"$le".$! i!ce!ti(e the "$.e *oe" !ot u"tif? the $uto.$tici.po"itio! of Q$t 10 &$te) A" ite.ie* b? petitio!e&' "uche3pe!"e i" co.po"e* of Co..i""io! E3pe!"e i! the $.ou!t of

10'200)00 $!* :&oFe& De$le& of 2';+'77)00)26U

The Cou&t $=&ee" /ith the CTAE: /he! it $


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pe&io* f&o. $!u$&? to #$&ch 1;) A=$i!' the Cou&t $=&ee" /ith the CTA

%i&"t Di(i"io! /he! it uphel* the CIR /ith &e"pect to the &o?$ltie" fo&

Dece.be& 17 but c$!celle* th$t f&o. $!u$&? to #$&ch 1;)

The CIR i!"i"t" th$t u!*e& Sectio! 92;U of Re(e!ue Re=ul$tio!" No) ,;2

$!* Sectio!" 2),7)+ $!* 2),;4A54254$52U

of Re(e!ue Re=ul$tio!" No) 2;'So!? "houl* $l"o be .$*e li$ble fo& the %WT o! &o?$ltie" f&o. $!u$&? to

#$&ch of 1;) At the "$.e ti.e' it *o/!pl$?" the &ele($!ce of the

#$!uf$ctu&i!= Lice!"e A=&ee.e!t 4#LA5 bet/ee! So!? $!* So!?$p$!'

p$&ticul$&l? i! the p$?.e!t of &o?$ltie")

The $bo(e &e(e!ue &e=ul$tio!" p&o(i*e the .$!!e& of /ithhol*i!=

&e.itt$!ce $" /ell $" the p$?.e!t of >!$l t$3 o! &o?$lt?) :$"e* o! the

"$.e' So!? i" &e-ui&e* to *e*uct $!* /ithhol* >!$l t$3e" o! &o?$lt?

p$?.e!t" /he! the &o?$lt? i" p$i* o& i" p$?$ble) Afte& /hich' theco&&e"po!*i!= &etu&! $!* &e.itt$!ce .u"t be .$*e /ithi! 10 *$?" $fte& the

e!* of e$ch .o!th) The -ue"tio! !o/ i" /he! *oe" the &o?$lt? beco.e

p$?$ble

!*e& A&ticle X4,5 of the #LA bet/ee! So!? $!* So!?$p$!' the

follo/i!= te&." of &o?$lt? p$?.e!t" /e&e $=&ee* upo!

4,5Withi! t/o 425 .o!th" follo/i!= e$ch "e.i$!!u$l pe&io*e!*i!= u!e 90 $!* Dece.be& 91' the LICENSEE "h$ll fu&!i"h tothe LICENSOR $ "t$te.e!t' ce&ti>e* b? $! o


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3 3

G.R. No. 181092

FORT ONIFACIO "E!EOPMENT CORPORATION, etitio!e&'(")

COMMISSIONER OF INTERNA RE!ENUE an RE!ENUE "ISTRICTOFFICER, RE!ENUE "ISTRICT NO. 44, TAGUIG an PATEROS, UREAUOF INTERNA RE!ENUE, Re"po!*e!t")

D E C I S I O N

EONAR"O"E CASTRO, J.:

The Cou&t h$" co!"oli*$te* the"e th&ee petitio!" $" the? i!(ol(e the "$.ep$&tie"' "i.il$& f$ct" $!* co..o! -ue"tio!" of l$/) Thi" i" !ot the >&"t ti.e

th$t %o&t :o!if$cio De(elop.e!t Co&po&$tio! 4%:DC5 h$" co.e to thi" Cou&t$bout the"e i""ue" $=$i!"t the (e&? "$.e &e"po!*e!t"' $!* the Cou&t E!:$!c h$" &e"ol(e* the. i! t/o "ep$&$te' &ece!t c$"e"1 th$t $&e $pplic$blehe&e fo& &e$"o!" to be *i"cu""e* belo/)

8)R) No) 17,707 i" $! $ppe$l b? ce&tio&$&i pu&"u$!t to Rule +, of the 17Rule" of Ci(il &oce*u&e f&o. 4$5 the Deci"io!2 *$te* Ap&il 22' 2009 of theCou&t of Appe$l" i! CA8)R) S No) 61,16 *i".i""i!= %:DC" etitio! fo&Re(ie/ /ith &e=$&* to the Deci"io! of the Cou&t of T$3 Appe$l" 4CTA5 *$te*

Octobe& 19' 2000 i! CTA C$"e No) ,;;,' $!* f&o. 4b5 the Cou&t of Appe$l"Re"olutio!9 *$te* No(e.be& 90' 2006 *e!?i!= it" #otio! fo&Reco!"i*e&$tio!)

8)R) No) 1;009, i" liFe/i"e $! $ppe$l b? ce&tio&$&i pu&"u$!t to Rule +, f&o.4$5 the Cou&t of Appe$l" Deci"io!+*$te* Ap&il 90' 2007 i! CA8)R) S No)76,+0 *e!?i!= %:DCJ" etitio! fo& Re(ie/ /ith &e"pect to the CTARe"olutio!, *$te* #$&ch 2;' 2009 i! CTA C$"e No) 6021' $!* f&o. 4b5 theCou&t of Appe$l" Re"olutio!6 *$te* Octobe& ;' 2007 *e!?i!= it" #otio! fo&Reco!"i*e&$tio!)

The CTA Re"olutio! &eco!"i*e&e* $!* &e(e&"e* it" e$&lie& Deci"io!7 *$te* $!u$&? 90' 2002 o&*e&i!= &e"po!*e!t" i! CTA C$"e No) 6021 to &efu!* o&i""ue $ t$3 c&e*it ce&ti>c$te i!f$(o& of petitio!e& i! the $.ou!tof77'1,1'020)+6' &ep&e"e!ti!= PVAT e&&o!eou"l? p$i* b? o& ille=$ll?collecte* f&o. petitio!e& fo& the >&"t -u$&te& of 1;' $!* i!"te$* *e!ie*petitio!e&J" Cl$i. fo& Refu!* the&efo&)P;

96

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8)R) No) 1;102 i" $l"o $! $ppe$l b? ce&tio&$&i pu&"u$!t to Rule +, f&o. theCou&t of Appe$l" Deci"io! *$te* Dece.be& 2;' 2007 i! CA8)R) S No)611,; *i".i""i!= %:DCJ" petitio! fo& &e(ie/ /ith &e"pect to the CTADeci"io!10 *$te* Septe.be& 2' 2000 i! CTA C$"e No) ,6+) The $fo&e"$i*CTA Deci"io!' /hich the Cou&t of Appe$l" $


38/100


p&ope&tie"P i! the *e>!itio! of the te&. P=oo*" o& p&ope&tie"'P the&eb?"ubecti!= the "$le of P&e$l p&ope&tie"P to VAT) The p&o(i"io!' $" $.e!*e*'&e$*"

SEC) 100) V$lueA**e* T$3 o! S$le of 8oo*" o& &ope&tie") 4$5 R$te $!*:$"e of T$3) The&e "h$ll be le(ie*' $""e""e* $!* collecte* o! e(e&? "$le'

b$&te& o& e3ch$!=e of =oo*" o& p&ope&tie"' $ ($lue$**e* t$3 e-ui($le!t to10 of the =&o"" "elli!= p&ice o& =&o"" ($lue i! .o!e? of the =oo*" o&p&ope&tie" "ol*' b$&te&e* o& e3ch$!=e*' "uch t$3 to be p$i* b? the "elle& o&t&$!"fe&o&)

415 The te&. P=oo*" o& p&ope&tie"P "h$ll .e$! $ll t$!=ible $!* i!t$!=ibleobect" /hich $&e c$p$ble of pecu!i$&? e"ti.$tio! $!* "h$ll i!clu*e

4A5 Re$l p&ope&tie" hel* p&i.$&il? fo& "$le to cu"to.e&" o& hel* fo& le$"e i!the o&*i!$&? cou&"e of t&$*e o& bu"i!e"")U

While p&io& to Republic Act No) 7716' &e$l e"t$te t&$!"$ctio!" /e&e !ot"ubect to VAT' the? bec$.e "ubect to VAT upo! the eHecti(it? of "$i* l$/)

Thu"' the "$le of the p$&cel" of l$!* b? petitio!e& bec$.e "ubect to $ 10VAT' $!* thi" /$" l$te& i!c&e$"e* to 12' pu&"u$!t to Republic Act No)997)20 etitio!e& $fte&/$&*" bec$.e$ VAT&e=i"te&e* t$3p$?e&)

O! Septe.be& 1' 16' i! $cco&*$!ce /ith Re(e!ue Re=ul$tio!" No) 7,4Co!"oli*$te* VAT Re=ul$tio!"5' petitio!e& "ub.itte* to &e"po!*e!t :IR'

Re(e!ue Di"t&ict No) ++' T$=ui= $!* $te&o"' $! i!(e!to&? li"t of it"p&ope&tie" $" of %eb&u$&? 2' 16) The tot$l booF ($lue of petitio!e&J" l$!*i!(e!to&? $.ou!te* to71'227',09'200)00)21

O! the b$"i" of Sectio! 10, of the NIRC'22 petitio!e& cl$i." $ t&$!"itio!$l o&p&e"u.pti(e i!put t$3 c&e*itof ; of71'227',09'200)00' the tot$l ($lue ofthe &e$l p&ope&tie" li"te* i! it" i!(e!to&?' o& $ tot$l i!put t$3 c&e*itof,'6;'200'2,6)00)29 Afte& the ($lue of the &e$l p&ope&tie" /$" &e*uce**ueto $ &eco!(e?$!ce b? petitio!e& to :CDA of $ p$&cel of l$!*' petitio!e&cl$i." th$t it i" e!title* to i!put t$3 c&e*it i! the &e*uce*

$.ou!tof+'2,0'+7,'000)+;)2+

Wh$t petitio!e& "eeF" to be &efu!*e* $&e the $ctu$l VAT p$?.e!t" .$*e b?it i! c$"h' /hich it cl$i." /e&e eithe& e&&o!eou"l? p$i* b? o& ille=$ll?collecte* f&o. it)2, E$ch Cl$i. fo& Refu!* i" b$"e* o! petitio!e&J" po"itio!th$t it i" e!title* to $ t&$!"itio!$l i!put t$3 c&e*it u!*e& Sectio! 10, of theol* NIRC' /hich .o&e th$! oH"et" the $fo&e"$i* VAT p$?.e!t")

9;

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8)R) No) 17,707

etitio!e&J" VAT &etu&!" >le* /ith the :IR "ho/ th$t fo& the "eco!* -u$&te&of 17' petitio!e& &ecei(e* the tot$l $.ou!t of ,'01+'7,,'2;7)+0 f&o. it""$le" $!* le$"e of lot"' o! /hich the output VAT p$?$ble/$",01'+7,',2;)7+)26 The VAT &etu&!" liFe/i"e "ho/ th$t petitio!e& .$*e

c$"h p$?.e!t" tot$li!= +;6'9,,';+6)7; $!* utilie* it" i!put t$3 c&e*itof 1,'11'6;1)6 o! pu&ch$"e" of =oo*" $!* "e&(ice")27

O! %eb&u$&? 11' 1' petitio!e& >le* /ith the :IR $ cl$i. fo& &efu!*of the$.ou!t of +;6'9,,';+6)7; /hich it p$i* i! c$"h $" VAT fo& the "eco!*-u$&te& of 17)2;

O! #$? 21' 1' petitio!e& >le* /ith the CTA $ petitio! fo& &e(ie/2 b? /$?of $ppe$l' *ocFete* $" CTA C$"e No) ,;;,' f&o. the $lle=e* i!$ctio! b?&e"po!*e!t" of petitio!e&J" cl$i. fo& &efu!* /ith the :IR) O! Octobe& 1'1' the p$&tie" "ub.itte* tothe CTA $ Stipul$tio! of %$ct"' Docu.e!t" $!*I""ue)90 O! Octobe& 19' 2000' the CTA i""ue* it" Deci"io! 91 i! CTA C$"e No),;;, *e!?i!= petitio!e&J" cl$i. fo& &efu!* fo& l$cF of .e&it)

O! No(e.be& 29' 2000' petitio!e& >le* /ith the Cou&t of Appe$l" $ etitio!fo& Re(ie/ of the $fo&e"$i* CTA Deci"io!' /hich /$" *ocFete* $" CA8)R SNo) 61,16) O! Ap&il 22' 2009' the CA i""ue* it" Deci"io!92 *i".i""i!= theetitio! fo& Re(ie/) O! No(e.be& 90' 2006' the Cou&t of Appe$l" i""ue* it"Re"olutio!99 *e!?i!= petitio!e&J" #otio! fo& Reco!"i*e&$tio!)

O! Dece.be& 21' 2006' thi" etitio! fo& Re(ie/ /$" >le*)

etitio!e& "ub.itte* it" #e.o&$!*u.9+ o! No(e.be& 7' 200; /hile&e"po!*e!t" >le* thei& PCo..e!tP9, o! #$? +' 200)96

O! Dece.be& 2' 200' petitio!e& "ub.itte* $ Supple.e!t97 to it"#e.o&$!*u. *$te* No(e.be& 6' 200;'"t$ti!= th$t the "$i* c$"e i"i!ti.$tel? &el$te* to the c$"e" of %o&t :o!if$cio De(elop.e!t Co&po&$tio! ()Co..i""io!e& of I!te&!$l Re(e!ue' 8)R) No) 1,;;;,' $!* %o&t :o!if$cio

De(elop.e!t Co&po&$tio! () Co..i""io!e& of I!te&!$l Re(e!ue'P 8)R) No)1706;0' /hich /e&e $l&e$*? *eci*e* b? thi" Cou&t' $!* /hich i!(ol(e the"$.e p$&tie" $!* "i.il$& f$ct" $!* i""ue")9;

E3cept fo& the $.ou!t" of t$3 &efu!* bei!= cl$i.e* $!* the pe&io*" co(e&e*fo& e$ch cl$i.' the f$ct" i! thi" c$"e $!* i! the othe& t/o co!"oli*$te* c$"e"belo/ $&e the"$.e) The p$&tie" e!te&e* i!to "i.il$& Stipul$tio!" i! the othe&t/o c$"e" co!"oli*$te* he&e)9

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