FACTS:

The petitioner, San Roque Power Corporation, filed two separate administrative claims for refund of its alleged unutilized input tax. The Bureau of Internal Revenue failed to act on its claims, so the petitioner filed petitions for review before the Court of Tax Appeals (CTA). The CTA Division partially granted the refund claim, but the Commissioner of Internal Revenue (CIR) filed a petition for review with the CTA En Banc. The CTA En Banc dismissed the petitioner's judicial claims on the ground of prematurity, ruling that they were filed in violation of the 120-day and 30-day periods prescribed in the National Internal Revenue Code (NIRC). The petitioner argues that at the time of filing, no ruling yet existed concerning these periods and that the CTA decisions, which did not require adherence to the periods, were recognized interpretations of the tax laws. The petitioner also asserts that the retroactive application of the ruling in Commissioner of Internal Revenue v. Aichi Forging Company of Asia, Inc. (Aichi) to its case is erroneous and violates certain constitutional principles.

ISSUES:

1. • Whether the Court of Tax Appeals (CTA) correctly dismissed the subject petitions for review based on Section 112 (D) of the NIRC, which provides for a 120-day period for the Commissioner to grant a refund or issue a tax credit certificate for creditable input taxes.
2. • Whether the CTA decisions dispensing with the timeliness of the judicial claim, as long as it is within the two-year prescriptive period, can be relied upon as binding precedents.

3. Whether the 120-day period for filing a judicial claim for refund of creditable input VAT is mandatory and jurisdictional.

4. Whether the petitioner's premature filing of the judicial claims for refund renders them void.

5. Whether the Court of Tax Appeals (CTA) has jurisdiction over the judicial claims filed by the petitioner.

6. Whether the petitioner can benefit from BIR Ruling DA-489-03 even if it did not invoke it.

7. Whether or not the taxpayer is entitled to claim a refund or tax credit for unutilized input Value-Added Tax (VAT) attributable to zero-rated sales.

8. Whether or not the taxpayer is required to submit the certified true copy of the VAT returns and proof of payment to avail of the refund or tax credit for unutilized input VAT.

RULING:

1. • The Court grants the petition.
2. • The CTA En Banc's dismissal of the subject petitions for review based on the 120-day period in Section 112 (D) of the NIRC was in accordance with the law. The court emphasized that the 120-day period is mandatory and jurisdictional.
3. • The claimed reliance on CTA decisions dispensing with the timeliness of the judicial claim, as long as it is within the two-year prescriptive period, is rejected. CTA decisions do not constitute precedents that bind the Court or the public. Only decisions of the Supreme Court constitute binding precedents forming part of the Philippine legal system.

4. Yes, the 120-day period for filing a judicial claim for refund of creditable input VAT is mandatory and jurisdictional. Failure to comply with this period renders the petition for refund void. This ruling was established in the case of Aichi Corporation v. Commissioner of Internal Revenue and has been consistently reiterated in subsequent similar cases.

5. Yes, the petitioner's premature filing of the judicial claims for refund renders them void. The petitioner filed the judicial claims before the expiration of the 120-day period and without any decision by the Commissioner of Internal Revenue. As such, the Court of Tax Appeals correctly found that the claims were prematurely filed.

6. Yes, the CTA has jurisdiction over the judicial claims filed by the petitioner. The CTA En Banc erred in setting aside the decision of the CTA Division on the ground of lack of jurisdiction. The CTA Division partially granted the claim for refund/credit in favor of the petitioner, and its decision must be reinstated.

7. Yes, the petitioner can benefit from BIR Ruling DA-489-03 even if it did not invoke it. BIR Ruling No. DA-489-03 is a general interpretative rule and applies to all taxpayers. The exception recognized in the case of San Roque allows all taxpayers who filed their judicial claims within the window period from December 10, 2003, to October 6, 2010, to rely on BIR Ruling No. DA-489-03, regardless of whether they specifically invoked it or not. The CTA En Banc failed to consider this ruling in disposing of the matter on jurisdiction.

8. The taxpayer is entitled to claim a refund or tax credit for unutilized input VAT attributable to zero-rated sales.

9. The taxpayer is not required to submit the certified true copy of the VAT returns and proof of payment to avail of the refund or tax credit for unutilized input VAT.

PRINCIPLES:

• CTA decisions do not constitute binding precedents, unlike decisions of the Supreme Court.

• The 120-day period in Section 112 (D) of the NIRC for the Commissioner to act on an administrative claim for refund of creditable input taxes is mandatory and jurisdictional.

• The 120-day period for filing a judicial claim for refund of creditable input VAT is mandatory and jurisdictional.

• Noncompliance with the mandatory 120+30-day period renders the petition before the Court of Tax Appeals void.

• A taxpayer can only file a judicial claim within thirty days from the expiration of the 120-day period if the Commissioner of Internal Revenue does not act within such period.

• The ruling in Aichi Corporation v. Commissioner of Internal Revenue established the mandatory and jurisdictional nature of the 120-day and 30-day periods.

• BIR Ruling No. DA-489-03 provided an exception to the mandatory and jurisdictional nature of the 120+30-day period. Taxpayers can rely on this ruling from the time of its issuance until the promulgation of Aichi Corporation v. Commissioner of Internal Revenue.

• During the window period from 10 December 2003 until October 6, 2010, taxpayers were not required to wait for the 120-day period before filing a judicial claim for refund. This exception was established in San Roque Power Corporation v. Commissioner of Internal Revenue and has been consistently applied in subsequent cases.

• The principles discussed above apply to the filing of judicial claims for refund of creditable input VAT.

• The CTA has jurisdiction over judicial claims filed within the window period recognized in the case of San Roque.

• BIR Ruling No. DA-489-03 is a general interpretative rule and applies to all taxpayers who filed their judicial claims within the window period.

• The exception recognized in San Roque allows taxpayers to rely on BIR Ruling No. DA-489-03, regardless of whether they specifically invoked it or not.

• Taxpayers engaged in zero-rated sales are entitled to claim a refund or tax credit for unutilized input VAT.

• Submission of the certified true copy of the VAT returns and proof of payment is not necessary for availing the refund or tax credit for unutilized input VAT.