THE Court of Tax Appeals on Thursday dismissed the petition of Smartmatic-TIM Corp. to have the Bureau of Internal Revenue issue a refund or a tax credit certificate of P193,488,562.15 in creditable input value-added tax Smartmatic paid in 2010.
In a 24-page decision, the appellate court’s First Division through Associate Justice Erlinda Uy said the petition filed by Smartmatic-TIM lacked merit.
In 2012, the election provider filed claims for tax refund for the VAT it paid 2010.
Smartmatic-TIM, for its part, said it was entitled to VAT refund because it rendered services to the Commission on Elections that were effectively zero-rated and that it was a VAT-registered firm.
Its claim for refund was filed within the two-year prescriptive period.
The bureau compelled Smartmatic-TIM to present documents to substantiate its claim, prompting the firm to submit dossiers.
In 2013, Smartmatic-TIM filed a petition for review, but BIR sought the dismissal of the petition.
“It is incumbent upon the latter [Smartmatic-TIM] to show that it has complied with the provisions under…the Tax Code. Otherwise, its failure to prove the same is fatal to its claim for refund,” the bureau said.
The appellate court said while there was a law stating that Smartmatic-TIM’s services rendered to the Comelec were subject to zero-percent VAT, entitlement is just “one thing.”
“Case law dictates that in a claim for tax refund or tax credit, the applicant must prove not only entitlement to the claim but also compliance with all the documentary and evidentiary requirements therefor,” it said.
The court dismissed the P57.8-million refund of Smartmatic-TIM, while of the P135.7-million remainder of the fourth quarter of 2010, only P1.4 million could be substantiated.
Meanwhile, Comelec chairman Andres Bautista said Smartmatic has delivered 71,456 vote counting machines of which 64,382 units have gone through a hardware assessment test.
The final batch of VCMs is in transit from Taiwan, Bautista said.