CIR vs KEPCO ILIJAN CORPORATION
Facts:
This is a petition for Review on Certiorari under Rule 45 of the Rules of Court seeking reversal of the
Resolutions of the CTA En Bank dated July 27, 2011 and November 15, 2011 respectively.
Court of Tax Appeals (CTA) First Division:
Respondent filed its Quarterly VAT returns the BIR for the first and second quarter of the year 2000. It also
filed the Application for Zero Rated Sales for the same calendar year which was duly approved by the BIR.
Respondent thereafter filed its claim for refund representing input tax incurred for the first two quarters of
year 2000 which the petitioner failed to act upon. Consequently, respondent filed a Petition for Review and an
Amended Petition for Review on March 21, 2002 and September 12, 2003 respectively. In her answer,
petitioner alleged, among others, that respondent is not entitled to the amount of the refund prayed for.
After the issues were enjoined, trial on the merits ensued. Respondent filed a Memorandum but petitioner
failed to file its required memorandum despite notice and as a consequence, the CTA First Division issued a
resolution submitting the case for a decision which entitles petitioner to a refund in the amount of P
443,447,184.50. There being no motion for reconsideration by BIR, the decision became final and executory
on September 11, 2009. Subsequently, a Writ of Execution was issued by the Court on February 16, 2010.
Petitioner alleges that she learned only of the Decision and subsequent issuance of Writ on March 7, 2011.
On April 11, 2011, petitioner filed for annulment of judgment with the CTA En Banc praying that the decision
of the CTA First Division be annulled and set aside and subsequent Entry of Judgment and Writ of Execution be
nullified. In opposition, respondent filed its Motion to Deny Due Course (the Petition of Annulment of
Judgment) on the ground that the CTA En Banc is bereft of jurisdiction to entertain annulment of judgments’
on the premise that the Rules of Court and the Revised Rules of Tax Appeals do not expressly provide a
remedy in the annulment of judgment. The CTA En Banc, on July 27, 2011, issued a Resolution dismissing the
petition. A Motion for Reconsideration was filed which met the same fate. Hence this petition.
Issue:
W/N the CTA En Banc has jurisdiction to take cognizance of the Petition for Annulment of Judgment
Held:
No, the CTA En Banc has no jurisdiction to take cognizance of the Petition for Annulment of Judgment.
Rule 47 of the Rules of Court provides that Annulment of Judgment is based only on the ground of extrinsic
fraud and lack of jurisdiction. It is a recourse that presupposes the filing of a separate and original action for
the purpose of annulling or avoiding a decision in another case. Annulment is a remedy in law independent of
the case where the judgment sought to be annulled is rendered. It is unlike a motion for reconsideration,
appeal or even a petition for relief of judgment because annulment is not a continuation or progression of the
same case, as in fact the case it seeks to annul is already final and executory. It is an extraordinary remedy
that is equitable in character and permitted only in exceptional cases.
Annulment of Judgment involves the exercise of original jurisdiction as conferred on the Court of Appeals by
BP 129, Section 9 (2). It also implies power by a superior court over a subordinate one, as provided for in Tule
47 of the Rules of Court, wherein the appellate court may annul a decision of the RTC and the RTC may annul a
decision of the MTC. However, the law and rules are silent when it comes to a situation similar to the case at
bar in which a court (CTA) is called upon to annul its own judgment. More specifically, the CTA En Banc is
asked to annul the decision of one of its divisions. A collegial court, sitting en banc, is not considered separate
and distinct court but a division of one and the same court; there is no hierarchy of courts within the Supreme
Court and Court of Appeals for each remain as one court notwithstanding that they also work in divisions. To
allow an en banc to annul a decision of one of its divisions is tantamount to allowing a court to annul its own
judgment and acknowledging that hierarchy exists within such court.
The Revised Rules of the CTA and the Rules of Court provide for no instance in which an en banc may revese,
annul or void a final decisions of a division. Verily, the Revised Rules of CTA provide for no instance of
Annulment of Judgment at all.
The Court held that the CTA correctly dismissed the petition and that the remedy which the petitioner could
have availed is a petition for Certiorari under Rule 65 filed as an original action before the Supreme Court and
not before the CTA En Banc.
The petition for review is denied and the assailed Resolutions of the CTA En Banc are AFFIRMED.
