THE COURT of Tax Appeals (CTA) denied Pilipinas Shell Petroleum Corp.’s petition for a P43-million tax refund on excise taxes for Jet A-1 fuel sold to tax-exempt international air carriers, citing lack of evidence.
The tax court’s Third Division, in a 15-page decision, said the oil company failed to prove payment of excise tax for the imported Jet A-1 fuel.
While Shell provided details of the alleged importations and excise tax payments, the Court noted the absence of supporting documentation.
The tribunal also emphasized the need for concrete evidence in tax refund cases, especially regarding the payment or collection of the refunded tax.
It cited a Supreme Court ruling in Coca-Cola Bottlers Philippines, Inc. vs. Commissioner of Internal Revenue to underscore that claims for tax refunds are treated as claims for exemption, requiring strict scrutiny and proof of compliance with the conditions for a refund.
“In claims for a refund, it is crucial to show the payment or collection of the amount of tax being refunded, not only for the purpose of determining whether there was a timely filing of the administrative and judicial claims… but more importantly, it is because a claim for refund must always be premised on the fact that the said amount went to the government coffers,” Associate Justice Catherine T. Manahan said in the ruling.
In denying the plea, the tribunal also emphasized the timeliness of the tax claims under the 1997 National Internal Revenue Code.
“Within two (2) years from the date of payment of the tax, the claimant must first file an administrative claim with [the] respondent (Bureau of Internal Revenue) before filing a judicial claim with the courts of law,” it said.
The CTA stressed the mandatory and jurisdictional nature of this timeline, highlighting its inability to consider claims filed outside this timeframe, regardless of subsequent developments.
The oil company said that photocopies should be admissible without comparison to originals, without objection to their authenticity.
However, the tribunal rejected this, pointing out that the BIR had agreed to the admission of the exhibits only if they were compared with the originals.
Pilipinas Shell later filed a Tender of Excluded Evidence, but the court clarified that this procedure is meant for appeals and does not change its conclusion regarding the lack of proof of payment. — Chloe Mari A. Hufana
