Central Luzon Drug Corp. v. Commissioner of Internal Revenue
REITERATIONFacts
The Antecedents: Petitioner Central Luzon Drug Corporation (CLDC), engaged in retail of medicines, filed a request with the Commissioner of Internal Revenue (CIR) for a tax credit certificate amounting to ₱32,170,409, representing 20% sales discounts granted to senior citizens in 2002. CLDC subsequently filed a Petition for Review with the Court of Tax Appeals (CTA) First Division. Procedural History: The CTA First Division denied CLDC's claim for insufficiency of evidence, stating that CLDC failed to show that its gross sales to senior citizens were declared as part of its taxable income. The CTA First Division denied CLDC's motion for reconsideration. CLDC then filed a Petition for Review with the CTA En Banc, which was dismissed for failure to attach a Verification, Certification of Non-Forum Shopping, Special Power of Attorney, and Secretary’s Certificate. The CTA En Banc denied CLDC's motion for reconsideration. The Petition: CLDC filed a Petition for Review on Certiorari with the Supreme Court to set aside the CTA En Banc's resolutions. Subsequently, CLDC filed a Motion to Withdraw, praying for the dismissal of the case without prejudice, stating the amount would be included in future claims as it was carried over to its 2003 Income Tax Return. The Office of the Solicitor General (OSG) did not oppose the withdrawal but argued it should be with prejudice, citing Section 2, Rule 17 of the Rules of Court, and highlighted the alleged defect in the verification due to the affiant's failure to present a valid ID.
Issue(s)
Whether the withdrawal of the appeal should be granted. Whether the dismissal of the case should be with or without prejudice.
Ruling
The Supreme Court granted the Motion to Withdraw and dismissed the Petition for Review with prejudice, declaring the case closed and terminated.
Ratio Decidendi
On the grant of the Motion to Withdraw: The Court found that the case was not yet submitted for decision or resolution as it had resolved to require petitioner to file a reply to the comments filed by the respondent and the OSG. Therefore, the withdrawal of the appeal was still a matter that could be granted by the Court, as opposed to a situation where the case is already submitted for decision. On the dismissal with prejudice: The Court agreed with the OSG that the dismissal should be with prejudice. By withdrawing the appeal, petitioner is deemed to have accepted the decision of the CTA. Since the CTA had already denied petitioner’s request for a tax credit certificate for insufficiency of evidence, it may no longer be included in future claims. The Court reiterated that an appellant who withdraws an appeal must face the consequence of the decision of the court a quo becoming final and executory. To allow the petitioner to circumvent the denial of its claim by abandoning its appeal and filing a new claim would be contrary to the principle of finality of judgments.
Main Doctrine
When an appeal is withdrawn, the assailed decision becomes final and executory, and the withdrawal is considered with prejudice as the petitioner is deemed to have accepted the decision of the lower court.