G.R. No. 244154 , July 15, 2020
Zuellig-Pharma Asia Pacific Ltd. Phils. ROHQ, Petitioner, vs. Commissioner of Internal Revenue (CIR), Respondent.

FACTS

Petitioner Zuellig-Pharma Asia Pacific Ltd. Phils. ROHQ (Zuellig-PH), a regional operating headquarters, filed its administrative claim for refund or tax credit of excess and unutilized input VAT for calendar year 2010 amounting to P39,931,971.21 with the BIR on February 17, 2011. The BIR issued a Letter of Authority on March 3, 2011, and made a written request for documents on June 29, 2011, which Zuellig-PH complied with on July 5, 2011. The BIR subsequently made verbal requests for additional documents from 2012 to 2014, to which Zuellig-PH acceded. On April 29, 2014, Zuellig-PH submitted further documents and manifested that it had submitted complete documents, requesting the BIR to act within 120 days. The BIR failed to act within 120 days from April 29, 2014. Consequently, Zuellig-PH filed a judicial claim before the Court of Tax Appeals (CTA) on September 25, 2014. The BIR argued the judicial claim was filed out of time, contending the 120-day period for the BIR to act should be reckoned from July 5, 2011 (the submission date following the written request), and the 30-day period to appeal expired on December 2, 2011. The CTA Second Division and the CTA En Banc dismissed the petition, ruling it was filed out of time, applying the doctrine from Pilipinas Total Gas, Inc. v. CIR that a request for additional documents must be in writing to suspend the 120-day period.

ISSUE

Whether or not Zuellig-PH’s judicial claim for refund was filed out of time.

RULING

No. The Supreme Court ruled that Zuellig-PH’s judicial claim was timely filed. The Court held that the 120-day period for the Commissioner of Internal Revenue to act on an administrative claim for refund under Section 112(C) of the Tax Code is reckoned from the date of submission of complete documents. In this case, the BIR’s subsequent verbal requests for additional documents and its continued processing of the claim beyond July 5, 2011, effectively rendered the earlier submission incomplete. The BIR’s conduct, including the Deputy Commissioner’s assurance in a March 12, 2014 letter that it would process the claim within the 120-day period provided all required documents were submitted, estopped it from claiming that the 120-day period commenced on July 5, 2011. The Court emphasized that while the government is generally not estopped by the errors of its agents, the BIR’s affirmative acts and representations in this instance warranted an exception to prevent manifest injustice. Therefore, the 120-day period commenced from Zuellig-PH’s last submission on April 29, 2014. Since the BIR failed to act within 120 days (by August 27, 2014), Zuellig-PH had 30 days, or until September 26, 2014, to file its judicial claim. Its filing on September 25, 2014, was within the period. The decisions of the CTA En Banc and CTA Second Division were reversed.