J.A.B. Bulao & Associates

CASE 2014-0009: UNION BANK OF THE  PHILIPPINES, Petitioner – versus – DEVELOPMENT BANK OF THE PHILIPPINES, Respondent (G.R. NO. 191555, 20 JANUARY 2014, PERLAS-BERNABE, JJ.) (BRIEF TITLE: UNION BANK VS. DBP)

DISPOSITIVE:

“WHEREFORE, the petition is DENIED. The Decision dated November 3, 2009 and Resolution dated February 26, 2010 of the Court of Appeals in CA-G.R. SP No. 93833 are hereby AFFIRMED.”

SO ORDERED.

SUBJECT/DOCTRINES:

WHAT IS LEGAL COMPENSATION?

LEGAL COMPENSATION IS DEFINED AS A MODE OF EXTINGUISHING OBLIGATIONS WHEREBY TWO PERSONS IN THEIR CAPACITY AS PRINCIPALS ARE MUTUAL DEBTORS AND CREDITORS OF EACH OTHER WITH RESPECT TO EQUALLY LIQUIDATED AND DEMANDABLE OBLIGATIONS TO WHICH NO RETENTION OR CONTROVERSY HAS BEEN TIMELY COMMENCED AND COMMUNICATED BY THIRD PARTIES.
 WHAT ARE THE REQUISITES OF LEGAL COMPENSATION?

 (1) THAT EACH ONE OF THE OBLIGORS BE BOUND PRINCIPALLY, AND THAT HE  BE AT THE SAME TIME A PRINCIPAL CREDITOR OF THE OTHER; 

(2) THAT BOTH DEBTS CONSIST IN A SUM OF MONEY, OR IF THE THINGS DUE  ARE CONSUMABLE, THEY BE OF THE SAME KIND, AND ALSO OF THE SAME  QUALITY IF THE LATTER HAS BEEN STATED; 

(3) THAT THE TWO DEBTS BE DUE; 

(4) THAT THEY BE LIQUIDATED AND DEMANDABLE;  

(5) THAT OVER NEITHER OF THEM THERE BE ANY RETENTION OR CONTROVERSY,  COMMENCED BY THIRD PERSONS AND COMMUNICATED IN DUE TIME TO THE  DEBTOR. (EMPHASES AND UNDERSCORING SUPPLIED)  

HOW DOES LEGAL COMPENSATION OPERATES?

WHEN  ALL THE REQUISITES MENTIONED IN ARTICLE 1279 ARE PRESENT, COMPENSATION TAKES EFFECT BY OPERATION OF LAW, AND EXTINGUISHES BOTH DEBTS TO THE CONCURRENT AMOUNT, EVEN THOUGH THE CREDITORS AND DEBTORS ARE NOT AWARE OF THE COMPENSATION.

CAN UNION BANK CLAIM LEGAL COMPENSATION: THAT IS –  IT HAS NO MORE OBLIGATION TO RETURN FUNDS TO DBP SINCE DBP IS ALSO OBLIGATED TO PAY UNION BANK CERTAIN LEASE PAYMENTS?

NO.

DBP’S ASSUMED OBLIGATIONS TO UNION BANK FOR REMITTANCE OF THE LEASE PAYMENTS ARE AS DECIDED IN A PREVIOUS CASE CONTINGENT ON THE PRIOR PAYMENT THEREOF BY FOODMASTERS’ TO DBP. SUCH COURT DECISION HAS ALREADY BECOME FINAL.

TO READ THE DECISION, JUST CLICK/DOWNLOAD THE FILE BELOW.

SCD-2014-0009-JAN 2014-UNION BANK

CASE 2014-0014: THE PRESIDENT OF THE CHURCH OF JESUS CHRIST OF LATTER DAY SAINTS, Petitioner,  – versus – BTL CONSTRUCTION CORPORATION, Respondent (G.R. NO. 176439); BTL CONSTRUCTION CORPORATION, Petitioner, – versus -THE PRESIDENT OF THE MANILA MISSION OF THE CHURCH OF JESUS CHRIST OF LATTER DAY SAINTS and BPI-MS INSURANCE CORPORATION, Respondents. (G.R. NO. 176718) (15 JANUARY 2014, PERLAS-BERNABE,  J.) (BRIEF TITLE: CHURCH OF JCOLDS VS. BTL CONSTRUCTION)

DISPOSITIVE:

WHEREFORE, the petition in G.R. No. 176439 is PARTLY GRANTED, while the petition in G.R. No. 176718 is DENIED. The Decision dated August 15, 2006 and Resolution dated January 26, 2007 of the Court of Appeals (CA) m CA-G.R. SP No. 84068 are hereby MODIFIED as follows:

(a) COJCOLDS is ORDERED to pay BTL the amount of Pl,612,017.74 representing the unpaid balance of 98% of the contract price, inclusive of the 10% retention money;

(b) BTL is ORDERED to pay COJCOLDS the amounts of Pl,851,280.00 as liquidated damages,

(c) P526,400.00 as cost overrun, and P300,533.49 as reimbursement for the overpayment in the works taken under Change Order Nos. 1 to 12.

(d)Each party shall bear its own costs.

SO ORDERED.”

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SCD-2014-0008-JAN 2014-BTL CONSTRUCTION

CASE 2014-0007: COMMISSIONER OF INTERNAL REVENUE, Petitioner, – versus – MINDANAO II GEOTHERMAL PARTNERSHIP, Respondent. (G.R. No. 191498, 15 DECEMBER 2014, SERENO, CJ) SUBJECT: RULES ON  PRESCRIPTIVE PERIODS FOR CLAIMING  REFUND OR CREDIT OF INPUT VAT (BRIEF TITLE: CIR VS. MINDANAO II GEOTHERMAL)

DISPOSITIVE:

“WHEREFORE, we GRANT the Petition. The assailed Court of Tax Appeals En Banc Decision dated 11November2009 and Resolution dated 3 March 2010 of the in CTA EB Case No. 448 (CTA Case No. 7507) are hereby REVERSED and SET ASIDE. A new ruling is entered DENYING respondent’s claim for a tax refund or credit of P6,791,845.24.

SO ORDERED.”

 SUBJECTS/DOCTRINES:

WHAT ARE THE RULES ON  PRESCRIPTIVE PERIODS FOR CLAIMING  REFUND OR CREDIT OF INPUT VAT?

THESE RULES ARE:

A.   TWO-YEAR PRESCRIPTIVE PERIOD 

1. 1.       IT IS ONLY THE ADMINISTRATIVE CLAIM THAT MUST BE FILED WITHIN THE TWO-YEAR PRESCRIPTIVE PERIOD. (AICHI)

1. 2.       THE PROPER RECKONING DATE FOR THE TWO-YEAR PRESCRIPTIVE PERIOD IS THE CLOSE OF THE TAXABLE QUARTER WHEN THE RELEVANT SALES WERE MADE. (SAN ROQUE)

1. 3.       THE ONLY OTHER RULE IS THE ATLAS RULING, WHICH APPLIED ONLY FROM 8 JUNE 2007 TO 12 SEPTEMBER 2008. ATLAS STATES THAT THE TWO- YEAR PRESCRIPTIVE PERIOD FOR FILING A CLAIM FOR TAX REFUND OR CREDIT OF UNUTILIZED INPUT VAT PAYMENTS SHOULD BE COUNTED FROM THE DATE OF FILING OF THE VAT RETURN AND PAYMENT OF THE TAX.  (SAN ROQUE)  

B.   120+30 DAY PERIOD  

1. 1.       THE TAXPAYER CAN FILE AN APPEAL IN ONE OF TWO WAYS: (1) FILE THE JUDICIAL CLAIM WITHIN THIRTY DAYS AFTER THE COMMISSIONER DENIES THE CLAIM WITHIN THE 120-DAY PERIOD, OR (2) FILE THE JUDICIAL CLAIM WITHIN THIRTY DAYS FROM THE EXPIRATION OF THE 120-DAY PERIOD IF THE COMMISSIONER DOES NOT ACT WITHIN THE 120-DAY PERIOD.

1. 2.       THE 30-DAY PERIOD ALWAYS APPLIES, WHETHER THERE IS A DENIAL OR INACTION ON THE PART OF THE CIR.

1. 4.       AS A GENERAL RULE, THE 3 0-DAY PERIOD TO APPEAL IS BOTH MANDATORY AND JURISDICTIONAL. (AICHI AND SAN ROQUE).

1. 5.          AS AN EXCEPTION TO THE GENERAL RULE, PREMATURE FILING IS ALLOWED ONLY IF FILED BETWEEN 10 DECEMBER 2003 AND 5 OCTOBER 2010, WHEN BIR RULING NO. DA-489-03 WAS STILL IN FORCE. (SAN ROQUE).

1. 6.          LATE FILING IS ABSOLUTELY PROHIBITED, EVEN DURING THE TIME WHEN BIR RULING NO. DA-489-03 WAS IN FORCE. (SAN ROQUE)

TO READ THE DECISION, JUST CLICK/DOWNLOAD THE FILE BELOW.

SCD-2014-0007-JAN 2014-MINDANAO II GEOTHERMAL