Philippine National Bank v. Revenue

QUISUMBING, J.:

Before us is a petition for review on certiorari assailing the Decision1 dated May 12, 2003 of the Court of Appeals in CA-G.R. S.P. No. 58230, which had reversed both the Decision2 and Resolution3 dated January 26, 2000 and March 21, 2000, respectively, of the Court of Tax Appeals (CTA) in C.T.A. Case No. 5406, entitled Philippine National Bank v. Commissioner of Internal Revenue and, accordingly, denied petitioner's claim for tax refund. The facts are undisputed. For the eight taxable quarters for the period June 30, 1994 up to March 31, 1996, petitioner filed its Quarterly Percentage Tax Returns and paid the corresponding 5% gross receipts tax (GRT)4 on its gross receipts, inclusive of interest income derived from investments, deposits and loans which were already subjected to the 20% final withholding tax (FWT).

On July 19, 1996, petitioner filed amended Quarterly Percentage Tax Returns for the said taxable quarters excluding the 20% FWT, invoking CTA Case No. 4720, entitled Asian Bank Corporation v. Commissioner of Internal Revenue , promulgated on January 30, 1996, wherein the tax court ruled that the 20% FWT on interest income should not form part of the bank's taxable gross receipts for GRT purposes. Petitioner's amended Quarterly Percentage Tax Returns reflected a lesser amount of taxable gross receipts resulting to an overpayment of GRT of ₱17,504,775.48, to wit: Period Covered Tax Due Per Tax Due Per Overpayment (Quarter - End) Original Return Amended Return For Refund June 30, 1994 [₱]107,483,285.27 [₱] 105,127,122.33 [₱] 2,356,162.94 September 30, 1994 114,292,729.36 111,817,191.57 2,475,537.79 December 31, 1994 118,443,383.42 116,573,108.77 1,870,274.65 March 31, 1995 127,781,909.47 125,733,423.93 2,048,485.54 June 30, 1995 105,615,948.79 102,932,534.56 2,683,414.23 September 30, 1995 136,977,975.85 134,253,099.12 2,724,876.73 December 31, 1995 137,565,078.91 135,893,668.65 1,671,410.26 March 31, 1996 133,260,982.62 131,586,369.28 1,674,613.34 TOTAL ₱