The Court of Tax Appeals (CTA) has denied for lack of merit the petition of Sankyu-Ats Consortium-B for an additional tax refund of P1.2 million for alleged excess and unutilized input value-added tax (VAT) on purchases of goods and services for the second quarter of 2019.

Out of the P4.8 million originally sought by Sankyu-Ats for refund, more than P3.5 million had been refunded by the Bureau of Internal Revenue (BIR) in 2021.

Sankyu-Ats, a logistics firm, challenged the BIR's partial denial of its administrative claim for refund or issuance of tax credit certificate (TCC) of P1,269,224.57 out of P4,821,286.42.

It told the CTA that the excess and unutilized VAT being claimed for refund are all attributable to its zero-rated sales of goods and services to Philippine Sinter Corporation which is a Philippine Economic Zone Authority (PEZA)-registered entity entitled to zero-rated VAT on the purchases of supply of goods and services needed for its export sales.

However, the CTA denied Sankyu-Ats' petition because of its failure to substantiate the alleged zero-rated sales.

"After a careful and thorough evaluation of the parties' respective evidence and the applicable laws, rules and regulations, the Court finds the instant petition bereft of merit," the CTA said.

The tax court said that Sankyu-Ats failed to proffer as evidence the purchase orders (POs) or contract with PSC, which would have enabled the court to determine the transactions.

Even if the BIR partially granted its claim, it is up to Sankyu-Ats to substantiate the additional claim before the court and not the BIR.

"The burden is on the taxpayer-claimant to show that it has strictly complied with the conditions for the grant of the tax refund or credit. For failure to substantiate the alleged zero-rated sales, petitioner cannot claim for refund the input taxes attributable thereto," the CTA ruled.

The 24-page decision was written by Associate Justice Jean Marie A. Bacorro-Villena with the concurrence of Presiding Justice Roman G. Del Rosario and Associate Justice Lanee S. Cui-David.