Commissioner of Customs v.

Philippine Phosphate Fertilizer Corporation

G.R.NO. 144440, September 1, 2004

Facts: Respondent Philippine Phosphate Fertilizer Corporation (Philphos) is a domestic

corporation engaged in the manufacture and production of fertilizers for domestic and
international distribution. Its base of operations is in the Leyte Industrial Development Estate, an
export processing zone. It is also registered with the Philippine Export Zone Authority (PEZA).
The manufacture of fertilizers required Philphos to purchase fuel and petroleum products for its
machineries. The fuel supplies are secured domestically from local distributors, in this case,
Petron Corporation which imports the same to which Philphos reimburses the corresponding
customs duties and taxes the former paid to the Bureau of Customs. Philphos sought of October
1991 to June 1992. it pointed out that being an enterprise registered with the export processing
zone, is entitled the claim for refund in a letter dated 04 January 1993. A Petition for Review was
filed with the Court of Tax Appeals (CTA) assailing the denial of the refund and which eventually
affirmed by the Court of Appeals (CA).

Issue: Whether Philphos is entitled to a refund of duties and taxes under the law.

Ruling: Sec.17 of the EPZA (now PEZA) Law particularizes the tax benefits accorded to duly
registered enterprises. It states:

SEC. 17 Tax Treatment of Merchandize in the Zone. – “(1) Except as otherwise provided
in this Decree, foreign and domestic merchandise, raw materials, supplies, articles, equipment,
machineries, spare parts and wares of every description except those prohibited by law, brought
into the Zone to be sold, stored, broken up, repacked assembled, installed, sorted, cleaned,
graded, or otherwise processed, manipulated, manufactured, mixed with foreign or domestic
merchandise or used whether directly in such activity, shall not be subject to customs and
internal revenue laws and regulations nor to local tax ordinances, the following provisions of law
to the contrary notwithstanding.” (Italics mine.)

The cited provision certainly covers petroleum supplies used, directly or indirectly, by
Philphos to facilitated its production of fertilizers, subject to the minimal requirement that these
supplies are brought into the zone. The supplies are not subject to customs and internal
revenue laws and regulations, nor to local tax ordinances. It is clear that Sec.17 (1) considers
such supplies exempt even if they are used indirectly, as they had been in this case. Since
Sec.17(1) treats these supplies for tax purposes as beyond the ambit of customs laws and
regulations, the arguments of the Commissioner invoking the provisions of the Tariff and
Customs Code must fail. Particularly, his point that the importation of the petroleum products by
Petron was deemed terminated under Sec. 1202 of the Tariff and Customs Code, and that the
termination consequently barred any future claim for refund under Sec. 1603 of the same law is
misplaced and inconsequential. Moreover, the cited provisions of the Tariff and Customs Code if
related to Sec. 17(1) of the EPZA Law would significantly render the argument strained and, if
upheld, obviate many of the benefits granted by Sec. 17(1), for the provision does not limit the
tax exemption only to direct taxes.

Commissioner of Customs vs Gelmart Industries

G.R.No 169352 Feb. 13, 2009
Facts: Petitioner is a corporation primarily engaged in the manufacturing of embroidery and
apparel products for the export market. It is, likewise, authorized to operate a Bonded
Manufacturing Warehouse (BMW), BMW No. 39, as evidenced by the Certification dated
January 16, 1991, issued by the Garments and Textile Export Board (GTEB). It is, likewise,
granted two licenses to import tax and duty-free materials and accessories for re-
exportation.Under these licenses, petitioner was authorized to import
“FABRICS/YARNS/LEATHERS/SUBMATERIALS” from various foreign principals with a total
value of US$4,771,308.00 and $2,472,579.20, respectively, with the limitation that these
licenses do not entitle the manufacturer to import finished and semi-finished goods, cut-to-
panel/knit to shape materials, and cut-piece goods. Since the start of its operations, petitioner
has manufactured several product lines. It started manufacturing embroidered handkerchiefs’
branched out to infants’ and children’s wear, knitted blouse and apparel products, shirts, ladies
dresses, night gown, pajama, swim wear, nylon stockings, brassieres and intimate ladies’
underwear.
During the year 1999, petitioner, in the course of its operations and on three (3)
different occasions in 1999, received consignments of various textile materials and accessories
from its supplier, to be manufactured into finished products for subsequent exportation to
principals abroad.
On August 20, 1999, then Commissioner of Customs Nelson Tan, issued a
Memorandum requiring the 100% examination of all shipments consigned to petitioner on its
transfer/release from the piers to CBW No. G-39. This Memorandum was prompted by the
Indorsement of the Warehouse and Assessment Monitoring Unit (WAMU) which recommended
the examination of the subject shipments by the examiner of the Warehouse and Assessment
Division (WAD) for alleged misdeclaration.
On August 31, 1999, Inspector Rodolfo Alfaro submitted a report stating that the
shipments under Entry Nos. 46297-99 and 46269-99 were examined at pier 3, South Harbor,
Manila, while Entry No. 44780-99 was examined inside the Bonded Manufacturing Warehouse
of petitioner, CBW No. G-39. After the inspection, a report was issued stating that the subject
shipments contained cotton fabrics with three (3%) percent spandex for shirting and fleece
textile materials. The Inspection Report concluded that these articles are not normally used for
the manufacture of brassieres and/or lace, for the Bra and Lace Division of petitioner, which
according to the BOC, is the only operational division. In the same Inspection report, Mr. Alfaro
recommended that the Import License of petitioner be verified to determine if the subject
shipments should be seized for violation of existing Customs Rules and Regulations. Thereafter,
 respective representatives from the GTEB and the BOC conducted an ocular inspection of the
Bonded Manufacturing Warehouse of petitioner.
During the ocular inspection, it was discovered that petitioner was operating the Bra and
Lace Division as well as the Auxiliary Division. It was likewise found that only machineries for
the two divisions exist and that there were no facilities for the other lines of products.
In a letter dated September 3, 1999, petitioner’s Corporate Secretary and in-house
counsel requested the GTEB for a Certification to clarify the description of
“FABRICS/YARNS/LEATHERS/SUBMATERIALS” or the articles petitioner is authorized to
import based on its License No. 077-99.
On September 6, 1999, a Certification was issued by the GTEB, certifying petitioner’s
license to import the following raw materials, to wit:

a. Polyester, acrylic, cotton and other natural or synthetic piece-goods

b. Various types of yarns and threads, nylon, polyester, wool and other synthetic or natural
piece-good
c. All types of leather and synthetic leathers
d. Non-woven fabrics and similar items
e. Various types of staple fibers (synthetic and natural)
f. Various drystuffs and chemical
g. Various accessories and supplies

On September 14, 1999, a certification was likewise issued by the Garments/Textile Mfg.
Bonded Warehouse Division-Port of Manila (GTMBWD-POM) that “Import License Nos. 48468
and 77-99 are the current licenses being utilized by GELMART INDUSTRIES PHILS., INC.”
which covers fabrics/yarn/leathers sub materials but “does not entitle the manufacturer to import
finished and semi-finished goods, cut-to-panel/knit to shape materials, and cut-piece goods.

A Memorandum dated January 10, 2001 was filed by petitioner with the District Collector
of Customs on January 12, 2001 in order to protest the seizure orders issued by the BOC.

In a Decision dated August 9, 2001, and which was received by petitioner on August 20,
2001, the District Collector of Customs ordered that the shipments be forfeited in favor of the
government for alleged violation of Section 2530 paragraphs (f) and (l) subparagraphs 3, 4 and
5 of the TCCP, as amended.
The CTA reversed the decree of forfeiture issued by petitioner and lifted the latter’s
WSDs. It also ordered the release of respondent’s importation subject to the condition that the
correct duties, taxes, fees and other charges shall be paid the BOC.
In the instant Petition dated October 4, 2005, petitioner, through the Office of the
Solicitor General, argues that the subject shipments were misdeclared as “100% polyester
knitted fabrics” and “100% cotton knitted fabrics” when they were, in fact, 100% polyester polar
fleece, fleece textile materials, and cotton fabrics with 3% spandex skirtings. The shipments
were allegedly correctly forfeited in favor of the government in accordance with Sec. 2503 of the
Tariff and Customs Code. Moreover, the subject shipments which allegedly consisted of
regulated items violated or exceeded the import permits of respondent. Petitioner also asserts
that although respondent is allowed to subcontract a portion of the manufacturing process
(involving the subject shipments), it violated the rules of the Garment and Textile Export Board
(GTEB) and the Bureau of Customs which allegedly allowed respondent to subcontract only a
small or incidental portion of the manufacturing process.
In its Comment dated February 10, 2006, respondent points out that the instant petition
questions the decision of a division of the CTA in contravention of Republic Act No. 9282 (R.A.
No. 9282), which provides that this Court exercises appellate jurisdiction over en banc decisions
or rulings of the CTA. Respondent avers that petitioner does not have standing to appeal the
judgment of the CTA as it had been declared in default by the latter. The decision of the CTA
had allegedly attained finality as petitioner failed to move for the reconsideration thereof or to file
a petition for review with the CTA en banc. Further, the instant petition allegedly raises factual
questions beyond the province of the Court to review.
On the substantive issues, respondent claims that the goods contained in the subject
shipments correspond to the articles described in the import entries and are covered by
respondent’s import licenses. Respondent insists that the GTEB rules do not prevent it from
engaging the services of sub-contractors. On the contrary, the rules allegedly allow it to perform
a portion of the manufacturing process within its premises while the other processes to
complete the finished products are permitted to be done through sub-contractors.
Held: Petitioner had indeed committed procedural missteps on his way to this Court.
First. Under Sec. 9 of R.A. No. 9282, “…A party adversely affected by a ruling, order or
decision of a Division of the CTA may file a motion for reconsideration or new trial before the
same Division of the CTA within fifteen (15) from thereof…” In this case, no motion was filed by
petitioner to seek the reconsideration of the assailed decision of the CTA.
Second. Sec. 11 of the same law provides that, “x x x A party adversely affected by a
resolution of a Division of the CTA on a motion for reconsideration or new trial may file a petition
for review with the CTA en banc.” In turn, “A party adversely affected by a decision or ruling of
the CTA en banc may file with the Supreme Court a verified petition for review on certiorari
pursuant to Rule 45 of the 1997 Rules of Civil Procedure” as ordained under Sec. 12 of R.A. No.
9282.
Again, this procedure was not followed by petitioner and no adequate explanation was
offered to justify his disregard of the rules. Petitioner vaguely suggests that filing a petition for
review with the CTA en banc would have been futile because the assailed decision was
concurred in by three (3) associate justices.
Third. Sec. 2, Rule 4 of the Revised Rules of the Court of Tax Appeals reiterates the
exclusive appellate jurisdiction of the CTA en banc relative to the review of decisions or
resolutions on motion for reconsideration or new trial of the court’s two (2) divisions in cases
arising from administrative agencies such as the Bureau of Customs. Hence, the Court is
without jurisdiction to review decisions rendered by a division of the CTA, exclusive appellate
jurisdiction over which is vested in the CTA en banc.

Petitioner’s failure to file a motion for reconsideration of the assailed decision of the CTA
First Division, or at least a petition for review with the CTA en banc, invoking the latter’s
exclusive appellate jurisdiction to review decisions of the CTA divisions, rendered the assailed
decision final and executory. Necessarily, all the arguments professed by petitioner on the
validity of the seizure, detention and ultimate forfeiture of the subject shipments have been
foreclosed.
It should be noted at this juncture, however, that the order of default against petitioner
(which had not been lifted) did not result in depriving him of standing to file a petition for
review. Nonetheless, let it be reiterated that the instant petition is so procedurally flawed that its
outright denial is warranted.
We cannot overlook the fact that respondent had been granted two licenses to import tax
and duty-free materials and accessories for re-exportation under License to Import No. 077-99
dated May 13, 1999 and Import License No. 048468 dated July 7, 1999. These import
licenses authorize respondent to import “FABRICS/YARNS/LEATHERS/SUBMATERIALS” from
various foreign principals with the limitation that these licenses do not entitle respondent to
import finished and semi-finished goods, cut-to-panel/knit-to shape materials, and cut-piece
goods.
The goods contained in the subject shipments undoubtedly fall under the category of
raw materials which respondent is authorized to import under the licenses which it had
indubitably obtained prior to the importation of the subject shipments. As such, there is no basis
for the forfeiture of the subject shipments on the ground of misdeclaration.
In sum, the procedural infirmities and insubstantial legal argumentation in the petition
combine to defeat petitioner’s claim.

Commissioner of Customs vs CTA, Las Islas Filipinas Food Corp.

G.R. Nos. 171516-17 Feb.13 2009

Facts: Respondent Las Islas Filipinas Food Corporation (LIFFC) owned and operated an
industry-specific customs bonded warehouse catering to food manufacturers.Among the
conditions for its establishment and operations was securing an import allocation from the Sugar
Regulatory Administration (SRA) every time it imported sugar for its clients.
On February 20, 2004, Pat-Pro Overseas Company, Ltd. (PPOC), a Thai company,
appointed LIFFC as its “exclusive offshore trading, storage and transfer facility” in the
Philippines for its local and foreign transshipment operations. Pursuant to this appointment, it
shipped ten (10) twenty-foot containers of refined sugar to LIFFC.
 The shipment of refined sugar arrived in Manila on April 24, 2004. Because LIFFC failed
to present an import allocation from the SRA, the shipment became subject of Alert Order. On
July 16, 2004, a decree of abandonment was issued due to LIFFC’s failure to file an import
entry. Thereafter, the Collector of Customs issued a warrant of seizure and detention on July 27,
2004 in view of the SRA’s advice that no import allocation had been granted to LIFFC.
On August 16, 2004, LIFFC and PPOC (respondents) moved to quash the decree of
abandonment. However, in an order dated September 21, 2004, the motion was denied (for
being filed out of time as the decree of abandonment had already attained finality on August 3,
2004).
Respondents appealed the September 21, 2004 order to the Commissioner of Customs
asserting that they were deprived of due process. They alleged that they were never notified of
the issuance of the decree of abandonment.
After reviewing the evidence on record, the Commissioner found that respondents were
not informed of the abandonment proceedings. Thus, in a decision dated February 4, 2005, he
set aside the decree of abandonment and ordered the institution of proceedings for seizure and
forfeiture.
Pursuant to the February 4, 2005 decision of the Commissioner, the Republic instituted
proceedings for the seizure and forfeiture of respondents’ importation. It contended that,
because respondents imported the refined sugar without securing an import allocation from the
SRA, the shipment should be forfeited pursuant to Section 2530 (f) and (1)-5 of the Tariff and
Customs Code of the Philippines (TCCP).
Respondents, on the other hand, asserted that the refined sugar was merely
transshipped to the Philippines while PPOC was looking for a buyer in the international market.
Thus, an import allocation from the SRA was unnecessary.
In decisions dated February 14, 2005 and February 16, 2005, the Collectors held that
because LIFFC did not secure an import allocation from the SRA, the shipment was an illegal
importation of refined sugar. They ordered its forfeiture in favor of the government.
On appeal, the Commissioner affirmed the decisions of both Collectors.
On April 15, 2005, respondents appealed to the Court of Tax Appeals (CTA) via petitions
for review contending that the Commissioner erred in affirming the February 14, 2005 and
February 16, 2005 decisions of the Collectors. They insisted that an import allocation from the
SRA was unnecessary inasmuch as the refined sugar was sent to the Philippines only for
temporary storage and warehousing and would be shipped eventually to PPOC’s final buyer.
On April 20, 2005, respondents filed a motion to release cargo for exportation upon filing
of a surety bond. The Commissioner opposed the said motion on the basis of Section 2301 of
the TCCP which provides:
Section 2301. Warrant for Detention of Property-Cash Bond. – Upon making any seizure, the
Commissioner shall issue a warrant for the detention of the property; and if the owner or
importer desires to secure the release of the property for legitimate use, the Collector shall, with
the approval of the Commissioner of Customs, surrender it upon the filing of a cash bond, in an
amount fixed by him, conditioned upon the payment of the appraised value of the article and/or
any fine, expenses and costs which may be adjudged in the case: Provided, That such
importation shall not be released under any bond when there is prima facieevidence of
fraud in the importation of the article: Provided, further, That articles the importation of which
is prohibited by law shall not be released under any circumstances whatsoever: Provided,
finally, That nothing in this section shall be construed as relieving the owner or importer from
any criminal liability which may arise from any violation of law committed in connection with the
importation of the article. (emphasis supplied)
The Commissioner argued that the shipment could not be released inasmuch as
respondents had no import allocation from the SRA. Thus, there was prima facie evidence of
fraud in the importation of refined sugar.
In a resolution dated July 12, 2005, the CTA granted the motion and ordered the release
of the shipment subject to LIFFC’s filing of a continuing surety bond.
The Commissioner moved for reconsideration but it was denied. The CTA ordered
respondents to comply with the July 12, 2005 resolution within 10 days. However, the release of
the shipment was held in abeyance for several months as respondents failed to comply with the
conditions imposed by the said resolution.

On March 20, 2006, we issued a temporary restraining order enjoining the

implementation of the said resolutions.The Commissioner basically contends that the CTA
committed grave abuse of discretion when it disregarded Section 2301 of the TCCP and
ordered the release of respondents’ shipment of refined sugar.
Held: We grant the petition. Section 2301 of the TCCP states that seized articles may
not be released under bond if there is prima facie evidence of fraud in their importation. Fraud is
a “generic term embracing all multifarious means which human ingenuity can devise and which
are resorted to by one individual to secure an advantage and includes all surprise, trick,
cunning, dissembling and any unfair way by which another is cheated.” Since fraud is a state of
mind, its presence can only be determined by examining the attendant circumstances.
Under Section 1202 of the TCCP, importation takes place when merchandise is brought
into the customs territory of the Philippines with the intention of unloading the same at port. An
exception to this rule is transit cargo entered for immediate exportation. Section 2103 of the
TCCP provides:
Section 2103. Articles Entered for Immediate Exportation. – Where an intent to export
the article is shown by the bill of lading, invoice, manifest or other satisfactory evidence, the
whole or part of a bill (not less than one package) may be entered for immediate exportation
under bond. The Collector shall designate the vessel or aircraft in which the articles are laden
constructively as warehouse to facilitate the direct transfer of the articles to the exporting vessel
or aircraft. Unless it shall appear by the bill of lading, invoice, manifest, or other satisfactory
evidence, that the articles arriving in the Philippines are destined for transshipment, no
exportation thereof shall be permitted except under entry for immediate exportation under
irrevocable domestic letter of credit, bank guaranty or bond in an amount equal to the
ascertained duties, taxes and other charges.
 Upon the exportation of the articles, and the production of proof of lading of same
beyond the limits of the Philippines, the irrevocable domestic letter of credit, bank guaranty or
bond shall be released. For an entry for immediate exportation to be allowed under this
provision, the following must concur:
(a) there is a clear intent to export the article as shown in the bill of lading, invoice, cargo
manifest or other satisfactory evidence;

(b) the Collector must designate the vessel or aircraft wherein the articles are laden as a
constructive warehouse to facilitate the direct transfer of the articles to the exporting vessel or
aircraft;

(c) the imported articles are directly transferred from the vessel or aircraft designated as a
constructive warehouse to the exporting vessel or aircraft and

(d) an irrevocable domestic letter of credit, bank guaranty or bond in an amount equal to the
ascertained duties, taxes and other charges is submitted to the Collector (unless it appears in
the bill of lading, invoice, manifest or satisfactory evidence that the articles are destined for
transshipment).
None of the requisites above was present in this case. While respondents insist that the
shipment was sent to the Philippines only for temporary storage and warehousing, the bill of
lading clearly denominated “South Manila, Philippines” as the port of discharge. This not only
negated any intent to export but also contradicted LIFFC’s representation. Moreover, the
shipment was unloaded from the carrying vessel for the purpose of storing the same at LIFFC’s
warehouse. Importation therefore took place and the only logical conclusion is that the refined
sugar was truly intended for domestic consumption.

(Sec. 4) CIR vs. CA , G.R. No. 95022 207 Scra 487

Petitioner, seeks a reversal of the Decision of respondent CA, dated Aug. 27, 1990, in CA-G.R. SP
No. 20426, entitled "Commissioner of Internal Revenue vs. GCL Retirement Plan, represented
by its Trustee-Director and the Court of Tax Appeals," which affirmed the Decision of the latter
Court, dated 15 December 1986, in Case No. 3888, ordering a refund, in the sum of P11,302.19,
to the GCL Retirement Plan representing the withholding tax on income from money market
placements and purchase of treasury bills, imposed pursuant to Presidential Decree No. 1959.
There is no dispute with respect to the facts. Private Respondent, GCL Retirement Plan (GCL,
for brevity) is an employees' trust maintained by the employer, GCL Inc., to provide retirement,
pension, disability and death benefits to its employees. The Plan as submitted was approved and
qualified as exempt from income tax by Petitioner Commissioner of Internal Revenue in
accordance with Rep. Act No. 4917.

ISSUE: Are school’s retained earnings tax-exempt?

RULING:
Yes. GCL Plan was qualified as exempt from income tax by the CIR in accordance with Rep. Act.
4917. The tax-exemption privilege of employees' trusts, as distinguished from any other kind of
property held in trust, springs from Section 56(b) (now 53[b]) of the Tax Code, “The tax
imposed by this Title shall not apply to employee's trust which forms part of a pension, stock
bonus or profit-sharing plan of an employer for the benefit of some or all of his employees . . .”
And rightly so, by virtue of the raison de'etre behind the creation of employees' trusts.
Employees' trusts or benefit plans normally provide economic assistance to employees upon the
occurrence of certain contingencies, particularly, old age retirement, death, sickness, or
disability. It provides security against certain hazards to which members of the Plan may be
exposed. It is an independent and additional source of protection for the working group. What is
more, it is established for their exclusive benefit and for no other purpose.
It is evident that tax-exemption is likewise to be enjoyed by the income of the pension trust.
Otherwise, taxation of those earnings would result in a diminution accumulated income and
reduce whatever the trust beneficiaries would receive out of the trust fund. This would run afoul
of the very intendment of the law. There can be no denying either that the final withholding tax
is collected from income in respect of which employees' trusts are declared exempt (Sec. 56 [b],
now 53 [b], Tax Code). The application of the withholdings system to interest on bank deposits
or yield from deposit substitutes is essentially to maximize and expedite the collection of income
taxes by requiring its payment at the source. If an employees' trust like the GCL enjoys a tax-
exempt status from income, we see no logic in withholding a certain percentage of that income
which it is not supposed to pay in the first place.

TUASON VS. LINGAD

Issue: Whether or not the properties in question which the petitioner had inherited and
subsequently sold in small lots to other persons should be regarded as capital assets.

As thus defined by law, CAPITAL ASSETS include all properties of a taxpayer whether or not
connected with his trade or business, except:

1. stock in trade or other property included in the taxpayer's inventory;

2. property primarily for sale to customers in the ordinary course of his trade or
business;
3. property used in the trade or business of the taxpayer and subject to depreciation
allowance; and
4. real property used in trade or business.
If the taxpayer sells or exchanges any of the properties above, any gain or loss relative
thereto is an ordinary gain or an ordinary loss; the loss or gain from the sale or exchange of
all other properties of the taxpayer is a capital gain or a capital loss.

Under Section 34(b)(2) of the Tax Code, if a gain is realized by a taxpayer (other than a
corporation) from the sale or exchange of capital assets held for more than 12 months, only
50% of the net capital gain shall be taken into account in computing the net income.
The Tax Code's provisions on so-called long-term capital gains constitutes a statute of
partial exemption. In view of the familiar and settled rule that tax exemptions are construed
instrictissimi juris against the taxpayer and liberally in favor of the taxing authority, it is the
taxpayer's burden to bring himself clearly and squarely within the terms of a tax-exempting
statutory provision, otherwise, all fair doubts will be resolved against him.

In the case at bar, after a thoroughgoing study of all the circumstances, this Court is of the
view and so holds that petitioner's thesis is bereft of merit. Under the circumstances,
petitioner's sales of the several lots forming part of his rental business cannot be
characterized as other than sales of non-capital assets. the sales concluded on installment
basis of the subdivided lots do not deserve a different characterization for tax purposes.

This Court finds no error in the holding that the income of the petitioner from the sales of
the lots in question should be considered as ordinary income.

In Intercontinental Broadcasting Corporation (IBC) v. Amarilla, 42 IBC withheld

the salary differentials due its retired employees to offset the tax due on their
retirement benefits. The retirees thus lodged a complaint with the NLRC
questioning said withholding. They averred that their retirement benefits were
exempt from income tax; and IBC had no authority to withhold their salary
differentials. The Labor Arbiter took cognizance of the case, and this Court made
a definitive ruling that retirement benefits are exempt from income tax, provided
that certain requirements are met. ScCEIA

Under the trust fund doctrine, the capital stock, property and other assets of the corporation are
regarded as equity in trust for the payment of the corporate creditors. Commissioner of Internal
Revenue v. Court of Appeals, 301 SCRA 152 (1999).