The Supreme Court (SC) has turned down the petition filed by Fortune Tobacco Corp. seeking a tax credit or refund in the amount of P219 million, representing the alleged overpaid excise tax for the period, covering from June 1 to December 31, 2004, on technicality.
In a 14-page decision penned by Associate Justice Jose Catral Mendoza, the SC Second Division held that Fortune Tobacco failed to produce the necessary documents to prove its claim for tax refund.
The SC pointed out that Fortune Tobacco failed to not only comply with the basic procedural requirement of presenting only the original copies of its documentary evidence, but also to adhere to the requirement of properly making its offer of proof or tender of excluded evidence for proper consideration of the court.
It noted that the petitioner relied heavily on photocopied documents to prove its claim.
“Indeed, while it is true that litigation is not a game of technicalities—it is equally true, however, that every case must be established in accordance with the prescribed procedure to ensure an orderly and speedy administration of justice,” the SC stressed.
“In all, the Court finds that the failure of petitioner to prove its claim in accordance with the settled rules merits its dismissal,” it added.
Based on records, Fortune Tobacco filed a claim for tax credit or refund under Section 229 of the National Internal Revenue Code of 1997 against the Bureau of Internal Revenue (BIR) for illegally collecting the P219-million excise tax.
After hearing the merits, the Former First Division of the Court of Tax Appeals (CTA) denied the petition for tax refund on April 30, 2009, for insufficiency of evidence. Fortune Tobacco elevated the case before the CTA en banc, which also denied its claim.
In upholding the CTA ruling, the SC declared that the “one who claims that he is entitled to a tax refund must not only claim that the transaction subject of tax is clearly and unequivocally not subject to tax—the amount of the claim must still be proven in the normal course, in accordance with the prescribed rules on evidence.”