REPUBLIC OF THE PHILIPPINES

COURT OF TAX APPEALS

QUEZON CITY

FIRST DIVISION

WILLORE PHARMA CTA CASE NO. 8602

CORPORATION,
Petitioner, Members:

- versus- DEL ROSARIO, P.J

UY, and
MINDARO-GRULLA, JJ.

THE COMMISSIONER OF
INTERNAL REVENUE, Promulgated:
Respondent.
; '3: S8e·-
•
x-------------------------------------------------
RESOLUTION

UY, J.:

In the Resolution dated September 15, 2016, the following

motions were submitted for resolution, to wit:

1. petitioner's Partial Motion for Reconsideration, filed on

July 7, 2016, and Supplemental Partial Motion for
Reconsideration (With Leave to Admit New
Evidence), filed through registered mail on July 8, 2016
and received by the Court on July 14, 2016, without
respondent's comments thereto; and

2. respondent's Motion for Partial Reconsideration

(Decision dated 22 June 2016), filed on July 11, 2016,
with petitioner's Comment (To the July 8, 2016 Partial
Motion for Reconsideration), filed on July 26, 2016.

The dispositive portion of the assailed Decision promulgated on

June 22, 2016, reads as follows: ~
RESOLUTION
CTA CASE NO. 8602
Page 2 of 16

"WHEREFORE, in light of all the foregoing, the

instant Petition for Review is PARTIALLY GRANTED.
The deficiency EWT on the rental of LCD/projector,
training room and function room, on income payments to
Hizon Laboratories, and the deficiency income tax
resulting from the disallowance of said expenses and the
donation which was found to be in the nature of an
advertising expense, as well the compromise penalties
imposed, are CANCELLED and SET ASIDE.
Accordingly, the assessments issued by respondent
against petitioner for taxable year 2008 covering
deficiency EWT, FBT, FWT, FWVAT and income tax are
UPHELD but WITH MODIFICATIONS. Petitioner is
ORDERED TO PAY respondent the amount of FIVE
MILLION FIVE HUNDRED THIRTEEN THOUSAND
ONE HUNDRED FOUR PESOS AND 9/100
(P5,513,104.09) representing basic deficiency EWT,
FBT, FWT, FWVAT and income tax, inclusive of the
twenty-five percent (25°/o) surcharge imposed under
Section 248(A)(3) of the NIRC of 1997, to wit:

25°/o
TYPE OF TAX BASIC TAX SURCHARGE TOTAL
EWT p 97,065.56 p 24,266.39 p 121,331.95
FBT 490,699.37 122 674.84 613,374.21
FWT 17,056.20 4,264.05 21,320.25
FWVAT 5,847.84 1,461.96 7,309.80
Income tax 3 799,814.30 949,953.58 4,749,767.88
Total P4,410,483.27 P1, 102,620.82 P5,513, 104.09

In addition, petitioner is ORDERED TO PAY:

a) Deficiency interest at the rate of twenty percent

(20°/o) per annum on the basic deficiency income tax
computed from April 15, 2009 until full payment thereof,
pursuant to Section 249(8) of the NIRC of 1997; and

b) Delinquency interest at the rate of 20°/o per

annum on the total amount of P5,513,104.09 and on the
20°/o deficiency interest which have accrued as afore-
stated in (a), computed from May 10, 2012 until full
payment thereof pursuant to Section 249(C)(3) of the
NIRC of 1997.

~
RESOLUTION
CTA CASE NO. 8602
Page 3 of 16

SO ORDERED."

Petitioner's Partial Motion for

Reconsideration

Petitioner seeks reconsideration of the assailed Decision insofar

as the Court upheld respondent's disallowance of petitioner's
unsupported expenses as deduction from gross income in the
reduced amount of P1,580,262.80. 1

In its Partial Motion for Reconsideration, petitioner prays

for the Court to allow fifty percent (50°/o) of its unsupported
expenses, citing as basis the case of Zamora vs. Collector of Internal
Revenue, 2 which was also quoted in Section 2.4( c) of Revenue
Memorandum Circular (RMC) No. 23-2000.

Petitioner argues that since the exact amount of its

unsupported expenses cannot be ascertained due to absence of
documentary evidence, it is the duty of the respondent to make an
estimate of the deduction that may be allowable in computing its
taxable income. Respondent allegedly failed to discharge the said
duty. Hence, following the ruling in the Zamora case, petitioner
prays that it be allowed 50°/o of its unsupported expenses.

The motion is bereft of merit.

The Court notes that petitioner is raising this matter for the first
time in the instant motion. Well-settled is the rule that points of law,
theories, issues and arguments not brought to the attention of the
lower court, administrative agency or quasi-judicial body need not be
considered by the reviewing court3 as they cannot be raised for the
first time on appeal, much more in a motion for reconsideration as in
this case, because this would be offensive to the basic rules of fair
play, justice and due process. This last ditch effort to shift to a new
theory and raise a new matter in the hope of a favorable result is a
pernicious practice that has consistently been rejected. 4

1
Pages 35 to 40 of the assailed Decision.
2
G.R. No. L-15290, May 31, 1963.
3
Nestor A. Jacot vs. Ragen T. Dal and Commission on Elections, G.R. No. 179848, November 27,
2008.
4
Rizal Commercial Banking Corporation vs. Commissioner ofInternal Revenue, G.R. No. 168498, ,1\
April 24, 2007. ,.
RESOLUTION
CTA CASE NO. 8602
Page 4 of 16

And even if, granting arguendo, that We allow petitioner to

raise this new issue in the instant Motion, We find that Section 2.4(c)
of RMC No. 23-2000 is not applicable in the case of petitioner.

It must be emphasized that RMC No. 23-2000 5 prescribes the

procedures on the assessment of deficiency internal revenue taxes
based on the ''Best Evidence Obtainable'~ The pertinent provisions of
RMC No. 23-2000 reads:

"SECTION 1. Scope. - It has been observed that a

very significant number of taxpayers either refuse or fail
to present their respective accounting records when
demanded for tax audit purposes, thereby resulting to the
delay in the submission of the Revenue Officer's report of
investigation as required by the existing Audit Program
and inconsistency in the determination of the deficiency
internal revenue tax that may properly be assessed and
demanded from the taxpayer, to the damage and
prejudice against the revenue.

In the absence of accounting records or other

documents necessary for the proper determination
of the taxpayer's internal revenue tax liability,
Section 6 (B) of the National Internal Revenue
Code of 1997 requires that the assessment of the
tax be determined based on the 'Best Evidence
Obtainable,' as follows:

'When a report required by law as a

basis for the assessment of any national
internal revenue tax shall not be forthcoming
within the time fixed by laws or rules and
regulations or when there is reason to believe
that any such report is false, incomplete or
erroneous, the Commissioner shall assess the
proper tax on the best evidence obtainable. '

SECTION 2. Prescribed Revenue Procedures. -

XXX XXX XXX

5 SUBJECT: Existing Revenue Procedures on the Assessment of Deficiency Internal Revenue

~
Taxes Based on the "Best Evidence Obtainable".
RESOLUTION
CTA CASE NO. 8602
Page 5 of 16

2.3 Assessment Based on Best Evidence

Obtainable. - An assessment based on best
evidence obtainable is justified when any of the
grounds provided by law is clearly established viz:

1. The report or records requested from the

taxpayer are not forthcoming i.e. the
records are lost; refusal of the taxpayer to
submit such records;

2. The reports submitted are false,

incomplete or erroneous.

XXX XXX xxx." (Emphases supplied)

Based on the foregoing provisions, it is clear that RMC No. 23-

2000 is applicable only when the assessment is based on the best
evidence obtainable, which in turn is justifiable only when it is clearly
established that the report or records are not forthcoming; that there
was refusal on the part of the taxpayer to submit such records; or
that the reports submitted are false, incomplete or erroneous.

In this case, there is no showing that the subject tax

assessments were based by respondent on the best evidence
obtainable. Thus, the provisions of RMC No. 23-2000 should not be
applied to this case.

Nevertheless, even granting that the subject tax assessments

were based on the best evidence obtainable, petitioner's case does
not fall under the "50°/o rule" in accordance with Section 2.4(c) of
RMC No. 23-2000.

Section 2.4(c) of RMC No. 23-2000 reads:

"2.4 Existing Revenue Procedures and

Jurisprudence Governing Assessment Based on the
Best Evidence Obtainable. - Provided hereunder
are the existing revenue procedures and
jurisprudence governing issuance of a deficiency
tax assessment based on the best evidence
obtainable:

XXX XXX XXX

f
RESOLUTION
CTA CASE NO. 8602
Page 6 of 16

(c) Assessment Based on Estimate; 50% Rule, in

the Absence of Receipts to Prove Actual
Amount of Expense Deduction. - The Court
held in the Mariano Zamora case that, if there
is a showing that expenses have been
incurred but the exact amount thereof cannot
be ascertained due to absence of
documentary evidence, it is the duty of the
BIR to make an estimate of the deduction
that may be allowable in computing the
taxpayer's taxable income, bearing heavily
against the taxpayer whose inexactitude is of
his own making. That disallowance of 50°/o of
the taxpayer's claimed deduction is valid.

'It is alleged by Mariano Zamora that the CTA

erred in disallowing P10,478.50 as promotion
expenses incurred by his wife for the promotion of
the Bay View Hotel and Farmacia Zamora. He
contends that the whole amount of P20,957.00, as
promotion expenses in his 1951 income tax returns,
should be allowed and not merely one-half of it or
P10,478.50, on the ground that, while not all the
itemized expenses are supported by receipts, the
absence of some supporting receipts has been
sufficiently and satisfactorily established. For, as
alleged, the said amount of P20,957.00 was spent
by Mrs. Esperanza A. Zamora (wife of Mariano),
during her travel to Japan and the United States to
purchase machinery for a new Tiki-Tiki plant, and to
observe hotel management in modern hotels. The
CTA, however, found that for said trip, Mrs. Zamora
obtained only the sum of PS,OOO.OO from the
Central Bank and that in her application for dollar
allocation, she stated that she was going abroad on
a combined medical and business trip, which facts
were not denied by Mariano Zamora. No evidence
had been submitted as to where Mariano had
obtained the amount in excess of PS,OOO.OO given
to his wife which she spent abroad. No explanation
had been made either that the statement contained
in Mrs. Zamora's application for dollar allocation
that she was going abroad on a combined medical

r
and business trip, was not correct. The alleged
RESOLUTION
CTA CASE NO. 8602
Page 7 of 16

expenses were not supported by receipts. Mrs.

Zamora could not even remember how much
money she had when she left abroad in 1951, and
how the alleged amount of P20,957.00 was spent."

Based on the foregoing, the "50°/o rule" is to be resorted to by

respondent when "there is a showing that expenses have been
incurred but the exact amount thereof cannot be ascertained due to
absence of documentary evidence'~

In the Zamora case, the "50°/o rule" was applied because there
was other evidence to show that the expenses were actually incurred
in connection with petitioner's business. In the said case, the
evidence such as the application of Mrs. Zamora for dollar
allocation shows that she went abroad on a combined
medical and business trip. It appears from the said evidence that
business expense was actually incurred, although, the Supreme Court
ruled that the same evidence also reveals that not all of her expenses
came under the category of ordinary and necessary expenses since
part thereof also constituted her personal expenses.

In other words, there must be other credible evidence showing

that expenses were actually incurred in connection with petitioner's
business before the "50°/o rule" can be applied. Such is not the case
of herein petitioner. Unlike in the Zamora case, petitioner did not
prove through credible documentary evidence that it actually incurred
the disallowed expenses in connection with its business. Thus, the
Court's ruling in relation to the disallowed expense shall remain.

Petitioner's Supplemental Partial

Motion for Reconsideration (With
Leave to Admit New Evidence)

In its Supplemental Partial Motion for Reconsideration,

petitioner also seeks reconsideration of the Court's ruling wherein it
upheld the disallowance of salaries and wages not subjected to
withholding tax amounting to P808,098.39 as a deduction from gross
income. 6

Petitioner submits as new evidence the "Certifications of

Premium Payment" from the Philippine Health Insurance Corporation

t
6
Pages 33 to 34 of the assailed Decision.
RESOLUTION
CTA CASE NO. 8602
Page 8 of 16

(Philhealth) with reservation to submit the certifications from the

Social Security System (SSS) and Home Development Mutual Fund
(HDMF). These documents allegedly support its motion as regards
the portion of the assailed Decision concerning the disallowance of
salaries and wages amounting to P808,098.39. According to
petitioner, these documents shall prove that the said amount pertains
to employer contributions to the SSS, Philhealth, HDMF and such
other contributions to other government agencies which should be
deducted from the gross income.

The Court finds the motion untenable.

In the instant supplemental motion, petitioner prays that it be

allowed to submit and present the alleged new documents at this
stage of the proceedings, Thus, the said motion shall be considered
as a motion for new trial.

Relative thereto, Section 5 of Rule 15 of the Revised Rules of

Court of Tax Appeals (RRCTA) provides the grounds for the filing of a
motion for new trial, as follows:

"SEC. 5. Grounds of motion for new trial. - A

motion for new trial may be based on one or more of the
following causes materially affecting the substantial rights
of the movant:

(a) Fraud, accident, mistake or excusable

negligence which ordinary prudence
could not have guarded against and by
reason of which the rights of such
aggrieved party has probably been
impaired in his rights; or

(b) Newly discovered evidence, which the

party could not, with reasonable
diligence, have discovered and produced
at the trial and, which, if presented,
would probably alter the result.

A motion for new trial shall include all grounds then

available and those not included shall be deemed
waived."

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RESOLUTION
CTA CASE NO. 8602
Page 9 of 16

Moreover, Section 6 of Rule 15 of the RRCTA reads as follows:

"SEC. 6. Contents of motion for reconsideration

or new trial and notice. -The motion shall be in writing
stating its grounds, a written notice of which shall be
served by the movant on the adverse party.

A motion for new trial shall be proved in the

manner provided for proof of motions. A motion for the
cause mentioned in subparagraph (a) of the preceding
section shall be supported by affidavits of merits which
may be rebutted by counter-affidavits. A motion for the
cause mentioned in subparagraph (b) of the preceding
section shall be supported by affidavits of the witnesses
by whom such evidence is expected to be given, or by
duly authenticated documents which are proposed to be
introduced in evidence.

A motion for reconsideration or new trial that does

not comply with the foregoing provisions shall be deemed
pro forma, which shall not toll the reglementary period for
appeal."

It is clear from the foregoing that the rules allow the filing of a
motion for new trial on grounds of fraud, accident, mistake or
excusable negligence; or of newly discovered evidence which should
be proved in the manner provided for proof of motions. It is also
required that the motion must be accompanied by affidavits of merits
or affidavits of pertinent witnesses.

A perusal of petitioner's allegations show that its supplemental

motion was neither based on fraud, accident, mistake or excusable
negligence, nor is the motion based on newly discovered evidence.
In other words, there was nothing in petitioner's motion which would
show that it invoked any of the grounds mentioned under the rules
for the filing of the motion for new trial. Neither did petitioner
submit affidavits of merits and/or affidavits of concerned witnesses.

At this juncture, it must be noted that procedural rules are not

to be belittled or dismissed simply because their non-observance may
have resulted in prejudice to a party's substantive rights. Like all
rules, they are required to be followed except only for the most

r
RESOLUTION
CTA CASE NO. 8602
Page 10 of 16

persuasive of reasons when they may be relaxed to relieve a litigant

of an injustice not commensurate with the degree of his
thoughtlessness in not complying with the procedure prescribed/

In this case, petitioner had all the opportunity to establish,

during trial, its assertion that the disallowed salaries and wages
pertain to contributions to government agencies which should be
deducted from the gross income. While the Court may, again, allow
petitioner to present supplementary evidence to support its allegation
at this stage of the proceedings by the filing of a motion for new trial,
petitioner nevertheless failed to comply with the requirements of the
rules when it had the opportunity to do so. Petitioner likewise did
not provide any justifiable reason for its failure to present the said
certifications during trial.

The Supreme Court in Atlas Consolidated Mining and

Development Corp. vs. Commissioner ofInternal Revenue, 8 held that:

"First, Atlas is guilty of inexcusable negligence in

the prosecution of its case. It is duty-bound to
ensure that all proofs required under the rules are
duly presented. Atlas has indeed repeatedly asserted
that in its action for the instant judicial claim, the CTA is
bound by its rules and suppletorily by the Rules of Court.
It certainly has not exercised the diligence required of a
litigant who has the burden of proof to present all that is
required. Second, forgotten evidence, not presented
during the trial nor formally offered, is not newly
found evidence that merits a new trial. Third, and
most importantly, it goes against the orderly
administration of justice to allow a party to submit
forgotten evidence which it could have offered
with the exercise of ordinary diligence, more so
when a decision has already been rendered."
(Emphasis supplied.)

Applying the foregoing, and considering that a liberal

application of rules of procedure in this case will only result in the
wanton disregard of the rules, the Court finds no justifiable basis to
grant petitioner's motion. Thus, the submission and presentation of
the certifications from Philhealth, 555 and HDMF cannot be allowed.
7
Spouses David Bergonia and Luzviminda Castillo vs. Court of Appeals (.fh Division) and Amado

r
Bravo, Jr., G.R. No. 189151, January 25, 2012.
8 G.R. No. 159490, February 18, 2008.
RESOLUTION
CTA CASE NO. 8602
Page 11 of 16

Considering therefore that there is no evidence on record to

support petitioner's motion for reconsideration as to the portion of
the assailed Decision pertaining to the disallowance of salaries and
wages amounting to P808,098.39, the Court's ruling on the matter is
sustained.

Respondent's Motion for Partial

Reconsideration (Decision dated
22lune 2016)

In his motion, respondent claims that this Court erred in

ordering the cancellation of the assessments issued against petitioner
for: deficiency expanded withholding tax (EWT) on the rental of
LCD/Projector, Training Room and Function Room; and deficiency
expanded withholding tax (EWT) on income payments to Hizon
Laboratories and the deficiency income resulting from the
disallowance of said expense and donation.

A. Cancellation of Deficiency EWT Assessment on the Rental of

LCD/Projector, Training Room and Function Room

Respondent posits that the Court erred in cancelling and setting

aside the deficiency EWT assessment issued against petitioner.
Respondent points out that it was properly determined by the
Revenue Officer during the examination of petitioner's books of
accounts that the amount of P49,768.00 was paid for the rental of
training room at Valle Verde while the amounts of P13,232.00 and
P1,100.00 were paid for the rentals of function room. According to
respondent, said finding is duly supported by documents.

Respondent maintains that based on petitioner's check voucher

marked as Exhibit "P-174", the amount of P49,768.00 was made in
payment for the use of training room and that there is also no clear
indication in the Banquet Agreement that said amount was for the
payment of food services. Furthermore, petitioner's check vouchers
marked as Exhibits "P-171" and "P-179" allegedly show that the
amounts of P1,100.00 and P13,232.00 were made as payments for
use of function room.

For its part, petitioner opposes respondent's arguments and

claims that the alleged rentals were actually payments for the use of
the training room and function room and for the purchase of foods,

(
RESOLUTION
CTA CASE NO. 8602
Page 12 of 16

and not for rentals. The nature of the said payments was allegedly
indicated in the supporting official receipts, banquet agreements,
function order, and cash/charge invoice.

The Court finds for petitioner.

We disagree with respondent's conclusion that the amounts of

P49,768.00 and P13,232.00, are rentals for the use of function rooms
wherein respondent merely relied on the description of the
transaction in the respective check vouchers9 •

Notably, nothing in the respective Banquet Agreements 10 show

that the payments were for food services. Apparently, respondent's
evaluation of the documents is erroneous. A check voucher is a
mere internal document of the taxpayer to facilitate and properly
record check disbursements. It is self-serving and does not by
itself prove the true nature of the transaction. To the mind of
the Court, the appropriate documents to establish the nature of a
transaction in order to come up with a proper assessment of the tax
implication thereon are supporting documents from and/or executed
with suppliers (i.e., invoices, official receipts, agreements).

In the case of Towne & City Development Corporation vs. Court

of Appeals, et a!., 11 the Supreme Court held that "a voucher is not
necessarily an evidence of payment. It is merely a way or method of
recording or keeping track of payments made. A procedure adopted
by companies for the orderly and proper accounting of funds
disbursed. Unless it is supported by an actual payment like the
issuance of a check which is subsequently encashed or negotiated, or
an actual payment of cash duly receipted for as is customary among
businessmen, a voucher remains a piece of paper having no
evidentiary weight".

While the Banquet Agreements do not categorically indicate

that the payments were for food services, paragraph 1 thereof
nevertheless referred to a document called "event order" as the basis
for executing the agreement. The "event order" attached to the
Banquet Agreements reflects the details of the costing for the said
event and mainly comprises of food packages. This sufficiently

9
Exhibits "P-174" and "P-179".
10 Exhibits "P-176" and "P-181".
11
G.R. No. 135043, July 14, 2004.

f
RESOLUTION
CTA CASE NO. 8602
Page 13 of 16

shows that the transaction pertain to food services and not rental of
function rooms. Clearly, the same are not subject to 5°/o EWT.

As regards the assessment for deficiency 5°/o EWT for the

amount of P1, 100.00, the same was upheld by the Court in the
assailed Decision 12 and not contested by petitioner. Hence, there is
no need to explain the same in this resolution.

B. Cancellation of Deficiencv EWT Assessment on Income Pavments

to Hizon Laboratories

Respondent claims that the Court erred in cancelling and

setting aside the deficiency tax assessment against petitioner for
non-withholding of taxes on income payments made to Hizon
Laboratories. According to respondent, petitioner merely alleged that
it received a notice that it belongs to the Top 20,000 corporations
only on January 29, 2009, but there was no allegation that petitioner
was never aware that it belongs to the Top 20,000 corporations
through Bureau of Internal Revenue (BIR) postings in its website or
through other means before January 29, 2009.

Citing RR No. 14-08, petitioner counter-argues that "a

corporation shall not be considered a withholding agent, unless such
corporation has been determined and DULY NOTIFIED IN WRITING
by the CIR that it has been selected as one of the top 20,000 private
corporations and that such authority as a withholding agent shall be
effective only UPON RECEIPT OF WRITTEN NOTICE from the CIR
that it has been classified as a large taxpayer, as well as one of the
top 20,000 private corporations".

Further, petitioner avers that nowhere in RR No. 14-08 does it

state: (a) that the respondent shall post in the BIR's website the
Notice that petitioner is one of the top 20,000 private corporations,
and (b) that the said posting of the Notice in the BIR's website
constitutes proper service to the petitioner.

Again, the Court finds for petitioner.

We quote the pertinent portions of RR No. 14-08, to wit:

(
12
Page 16 of the Assailed Decision.
RESOLUTION
CTA CASE NO. 8602
Page 14 of 16

"REVENUE REGULATIONS NO. 14-08

SUBJECT: Amending Further Section 2.57.2 (M) of

Revenue Regulations No. 2-98, as Amended,
Increasing the Coverage of Withholding Tax
Agents Required to Withhold 1°/o from Regular
Suppliers of Goods and 2°/o from Regular
Suppliers of Services from the Top 10,000
Private Corporations to Top 20,000 Private
Corporations
XXX XXX XXX

SECTION 2. Amendment - Section 2.57.2 (M) of

Revenue Regulations 2-98, as amended, is hereby further
amended to read as follows:

XXX XXX XXX

"Sec. 2.57 .2. Income payment subject to creditable

withholding tax and rates prescribed thereon. - Except
as herein otherwise provided, there shall be withheld a
creditable income tax at the rates herein specified for
each class of payee from the following items of income
payments to persons residing in the Philippines.

XXX XXX XXX

'(M) Income payments made by the top twenty

thousand (20, 000) private corporations to their
local/resident supplier of goods and local/resident
supplier of services other than those covered by other
rates of withholding tax. - Income payments made by
any of the top twenty thousand (20,000) private
corporations, as determined by the Commissioner, to
their local/resident supplier of goods and local/resident
supplier of services, including non-resident alien engaged
in trade or business in the Philippines.

XXX XXX XXX

A corporation shall not be considered a withholding agent

for purposes of this Section, unless such corporation
has been determined and duly notified in writing
by the Commissioner that it has been selected as

(
RESOLUTION
CTA CASE NO. 8602
Page 15 of 16

one of the top twenty thousand (20,000) private

corporations.

Any corporation which has been duly classified and

notified as large taxpayer by the Commissioner pursuant
to RR 1-98, as amended, shall be automatically
considered one of the top twenty thousand (20,000)
private corporation~ provided, however, that its
authority as a withholding agent shall be effective
only upon receipt of written notice from the
Commissioner that it has been classified as a large
taxpayer, as well as one of the top twenty
thousand (20,000) private corporations, for
purposes of these regulations.

XXX XXX xxx"

In this case, petitioner was able to present the Notice for

Inclusion as Top 20,000 Private Corporation 13 showing that it is
included in the top 20,000 private corporations and that it was
notified only on January 29, 2009. Also, the notice states that
petitioner will commence withholding on its purchases of goods and
services from its actual receipt of the said notice.

Notably, respondent failed to present evidence to controvert

the facts established by petitioner's document. Thus, the Court has
no reason to change its ruling that petitioner was not yet required to
withhold 1°/o EWT on its purchases of goods from Hizon Laboratories
in 2008 because it was notified of its inclusion as top 20,000 private
corporation only on January 29, 2009.

Consequently, the corresponding deficiency EWT assessment

on petitioner's income payments to Hizon Laboratories was properly
cancelled by the Court.

WHEREFORE, in view of the foregoing considerations,

petitioner's Partial Motion for Reconsideration and
Supplemental Partial Motion for Reconsideration (With Leave
to Admit New Evidence) and respondent's Motion for Partial
Reconsideration are DENIED for lack of merit.

r
13
Exhibit "P-276".
RESOLUTION
CTA CASE NO. 8602
Page 16 of 16

SO ORDERED.
,
ER~P.UY
Associate Justice

WE CONCUR:

f':,t~-t= ~ Ma-:~.6~
ffiiiTO N: MINDARO-GRULLA
Presiding Justice Associate Justice