Commissioner of Internal Revenue, Petitioner vs.

Aichi Forging Company of Asia, Inc. Respondent

GR No. 184823, October 6, 2010

Facts:
1. The respondent, a value-added tax (VAT)-registered entity, filed a claim for refund in the
amount of P 3, 891, 123.82 for the period of July 1, 2002 to September 30, 2002 to the
petitioner through the Department of Finance (DOF) One-Stop Shop Inter-Agency Tax Credit
and Duty Drawback Center for the input VAT on September 30, 2004. On the same date, the
respondent filed a petition for review of the said refund to the Court of Tax Appeals (CTA)
which was raffled to the Second Division of the CTA.
2. From July 1, 2002 to September 30, 2002 the respondent asserted that it generated and
recorded zero-rated sales in the amount of P 131, 791, 399.00 and paid input VAT amounting
to P 3, 912, 088.14 from purchases and importation attributable to its zero-rated sales.
3. In order to be eligible for a refund, the following conditions must be met pursuant to Section
112 (A) of the National Internal Revenue Code (NIRC) of 1997:
 The taxpayer is engaged in sales which are-zero-rated or effectively zero-rated;
 The taxpayer is VAT-registered;
 The claim must be filed within two (2) years after the close of the taxable quarter
when said sales were made; and
 The creditable input tax due or paid must be attributable to said sales, except the
transitional input tax, the extent that such input tax has not been applied against the
output tax.
4. The CTA partially granted the refund less the exceptions found by the ICPA, hence the
amount of refund to P 3, 239, 119.25.
5. The petitioner filed a motion for reconsideration to the CTA and CTA En Banc for the
argument that the respondent did not file the claim on time since based on the Article 13 of
the Civil Code, when the law speaks of year, it is equivalent to 365 days; however, since
2004 is leap year, the two-year period expired on September 29, 2004.
6. CTA and CTA En Banc denied the petition.

Issue:
1. Whether or not the claim was filed within the two-year period as prescribed under Section
112 of the NIRC of 1997.

Ruling:
1. Yes. Between the Article 13 of the Civil Code, which provides that a year is equivalent to 365
days and Section 31 of the Administrative Code of 1987 which states that is composed of 12
months, the more recent law will be applied following the principle of Lex posteriori derogate
priori. Consequently, since the claim was filed on September 30, 2004, said claim was filed
timely.