SC junks oil firm's P209-M tax case

June 25, 2009 8:45 am 

MANILA, June 25 – The Supreme Court (SC) has dismissed a case filed by Pilipinas Shell Petroleum Corp. (Shell) involving the P209-million worth of liabilities for customs duties and internal revenue taxes which the latter paid using tax credit certificates (TCCs) and which was later cancelled by the government.

In a 12-page ruling penned by SC Second Division Chair Associate Justice Arturo Brion, it said Shell did not make any protest on the assessment made against the company.

In fact, the SC said, Shell even paid its tax liabilities using the TCCs.

"We note in this regard that Shell never protested the original assessments of its tax liabilities and, in fact, settled them during the TCCs. These original assessments, therefore, have become final, incontestable, and beyond any subsequent protest proceeding, administrative or judicial, to rule upon," the SC said.

The SC pointed out that since this case involves payment and collection issue and not assessment, this should have been filed with the regular courts and not with the Court of Tax Appeals.

Court records show the oil company is questioning the validity of the cancellation of the TCCs made by the defunct One-Stop Shop Inter-Agency Tax Credit and Duty Drawback Center.

The case stemmed from the tax liabilities for the years 1997 and 1998 which Shell paid using the TCCs transferred to it by several companies which was approved by the One Stop Shop.

Both the Bureau of Internal Revenue and the Bureau of Customs accepted and allowed Shell to use the TCCs to pay and settle its tax liabilities.

The One Stop Shop through the Department of Finance in November 1999 informed Shell of the cancellation of the TCCs, saying that post-audit investigation show that the TCCs were fraudulently acquired and sold to Shell.

The oil company objected to cancellation of TCCs saying that it had been denied due process and later on went to court citing that the cancellation of the certificates was improper. (PNA)

DCT/PTR

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