Digest for learning po :)

1. Zuellig Pharma Asia Pacific Ltd. Philippines, ROHQ, v. CIR G.R. No . 244154 July 15, 2020

Doctrine: It is not required that the requests for additional documents by the taxing authority be made
in written form. All subsequent verbal requests made by the tax authority are sufficient for the purpose
of determining the reckoning point of the 120-day period.

FACTS:

Zuellig filed an administrative claim for refund before the BIR in February 17, 2011 for taxes it
paid in 2010. In June of the same year, the BIR requested Zuellig to submit supporting documents to its
claim and complied the next month. Further “verbal requests for submission of documents” were made
from 2012 to 2014, Complete submission was made on April 29, 2014. However, BIR failed to act on the
claim pointing out that Zuellig filed it out of time.

The tax appellate court’s second division dismissed the tax refund claim of Zuellig for being filed
out of time, saying the 120-day period the bureau should act on the refund claim should start on July 5,
2011 when the company submitted the requested documents. The CTA disregarded the verbal requests
for written documents as it should be in writing.

Issue:

Whether or not the request for additional documents must always be made in written form in
determining the reckoning point of the 120-day period.

Held:

No. It is not required that the requests for additional documents by the taxing authority be
made in written form. All subsequent verbal requests made by the tax authority are sufficient for the
purpose of determining the reckoning point of the 120-day period.

Under sec. 112 (c) of the NIRC, the bureau is to grant a refund or issue a tax credit certificate within 120
days from submission of complete documents. The taxpayer has 30 days from the receipt of the denial
or lapse of the period 120-days without a decision, to fail a claim to the CTA. Revenue Memorandum
Circular No. 49-2003 also states that claims shall be processed within 120 days from receipt of complete
document.

The court said that Zuellig complied with the BIR’s written and verbal requests for additional
documents. All verbal requests and submissions in response were confirmed by the BIR. The 120-day
period should be counted starting from the April 29, 2014 letter of Zuellig, stating that it had already
submitted complete documents.

The court also said that the Tax Code or the RMC No. 49-2003 did not require the authority’s
request for additional documents in a specific form. nowhere in the law does it require that the request
for additional documents must always and absolutely be made in written form,”

2. Provincial Government of Cavite vs. CQM Management, Inc.

Doctrine: a person who was neither the owner of the property nor the beneficial user thereof during the
period covered by the assessment, should not be held liable for deficiency real property taxes (RPT).
Facts:

CQM was held liable for the RPT due on its Maxon and Ultimate properties for the years 2000 to
2013 (maxon property) and 1997-2013 (ultimate property) even though CQM became the owner the
properties only in 2014.

There are two subject properties, one previously owned by Maxon Systems Philippines, Inc.
(Maxon) and one by Ultimate Electronic Components, Inc. (Ultimate), are located at the PEZA, Rosario,
Cavite. These were mortgaged to Philippine Investment One (SPV-AMC) Inc. (PI One).

Maxon and Ultimate failed to pay their obligations to PI One, hence both properties are
foreclosed. During the auction, Maxon property was sold to PI One as the highest bidder, while the
Ultimate property was sold to CQM. Subsequently, PI One sold all of its rights over the Maxon property
to CQM.

The problem arose when CQM tried to consolidate its tax declarations over the properties after
the lapse of the redemption periods. The Provincial Treasurer of Cavite said that Maxon and Ultimate
have unpaid real property taxes for the years 2000-2013 and 1997-2013, respectively. Thus, CQM could
not obtain the necessary tax clearance on the Maxon and Ultimate properties. Thereafter, the Provincial
Treasurer issued a tax assessment and a warrant of levy against Maxon and Ultimate, now owned by
CQM, after having declared the properties as delinquent.

Issue:

WON CQM is liable for rpt

Held:

No. a person who was neither the owner of the property nor the beneficial user thereof during
the period covered by the assessment, should not be held liable for deficiency real property taxes (RPT).
“To impose the real property taxes on respondent, which was neither the owner nor the beneficial user
of the property during the designated periods would not only be contrary to law but also unjust.”

CQM cannot be held liable for the RPT due prior to becoming the owner or beneficial user of the
properties. And even after becoming the owner of the properties, CQM, as a PEZA-registered entity, is
still exempt from any local or national taxes (RPT included), save for a 5% tax on its gross income, as
provided under Section 24 of Republic Act No. 7916 (PEZA law), as amended. It was not shown that CQM
is a developer subject to RPT under the PEZA law. The Supreme Court said that there is nothing in the
PEZA law which requires prior concurrence from the LGU before the exemption can be availed of.

Lastly, the collection of some of the unpaid taxes already prescribed because of the lapse of the
5-year period to collect under Section 270 of the Local Government Code.
Question and answer

Case 1 and 2

Q1: Under sec. 112 (c) of the NIRC, the bureau is to grant a refund or issue a tax credit certificate within
120 days from submission of complete documents. In determining the reckoning point of the 120-day
period, the request for additional documents must be made in what form?

a. written

b. verbal

c. both a and b

d. none of the choices.

Ans: C.

Q2: In this case, the SC held that “a person who was neither the owner of the property nor the beneficial
user thereof during the period covered by the assessment, should not be held liable for deficiency real
property taxes”

a. CIR vs. BCDA

b. CIR v. Chevron Holdings, Inc.

c.  Provincial Government of Cavite v. CQM

d. CIR v. Yumex

Ans : C.