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    Case Digest - G.R. No. 188550 - Deutsche Bank AG vs. Commissioner of Internal Revenue

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    Case Digest_ G.R. No. 188550 - Deutsche Bank AG vs. Commissioner of Internal Revenue

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    Case Digest - G.R. No. 188550 - Deutsche Bank AG vs. Commissioner of Internal Revenue

    Uploaded by

    Mira Le
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    Case Digest_ G.R. No. 188550 - Deutsche Bank AG vs. Commissioner of Internal Revenue

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    Case Digest_ G.R. No. 188550 - Deutsche Bank AG vs. Commissioner of Internal Revenue

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    Case Digest_ G.R. No. 188550 - Deutsche Bank AG vs. Commissioner of Internal Revenue

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    © All Rights Reserved
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    Download as pdf or txt
    2 views2 pages

    Case Digest - G.R. No. 188550 - Deutsche Bank AG vs. Commissioner of Internal Revenue

    Uploaded by

    Mira Le
    Case Digest_ G.R. No. 188550 - Deutsche Bank AG vs. Commissioner of Internal Revenue

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
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    Title

    Deutsche Bank AG vs. Commissioner of Internal Revenue

    Case Decision Date


    G.R. No. 188550 Aug 19, 2013

    Deutsche Bank AG Manila Branch successfully claims a refund of the branch


    profit remittance tax (BPRT) after the Supreme Court rules that failure to strictly
    comply with administrative requirements should not deprive the petitioner of the
    benefits of the RP-Germany Tax Treaty.

    Case Digest (G.R. No. 188550)


    Comprehensive

    Facts:
    The case is Deutsche Bank AG Manila Branch v. Commissioner of Internal Revenue
    (G.R. No. 188550).
    Petitioner: Deutsche Bank AG Manila Branch.
    Respondent: Commissioner of Internal Revenue.
    Filed a Petition for Review under Rule 45 of the 1997 Rules of Civil Procedure.
    Decision date: August 19, 2013.
    Chief Justice Sereno was the ponente.
    The petitioner remitted PHP67,688,553.51 as 15% branch profit remittance tax (BPRT)
    to Deutsche Bank Germany for 2002 and prior years.
    Believing it overpaid, the petitioner filed for a refund or tax credit certificate of
    PHP22,562,851.17 on October 4, 2005.
    Petitioner also requested confirmation of a 10% preferential tax rate under the RP-
    Germany Tax Treaty on the same date.
    Bureau of Internal Revenue (BIR) inaction led the petitioner to file a Petition for
    Review with the Court of Tax Appeals (CTA) on October 18, 2005.
    CTA Second Division denied the claim, citing non-compliance with RMO No. 1-
    2000's 15-day prior application requirement.
    CTA En Banc affirmed the Second Division's decision, referencing the Mirant case.

    Issue:
    Whether failure to strictly comply with RMO No. 1-2000 will deprive persons or
    corporations of the benefit of a tax treaty.

    Ruling:
    The Supreme Court ruled in favor of Deutsche Bank AG Manila Branch.
    The petition was granted, reversing the CTA En Banc Decision dated May 29, 2009,
    and Resolution dated July 1, 2009.
    The Commissioner of Internal Revenue was ordered to refund or issue a tax credit
    certificate of PHP22,562,851.17 to the petitioner.

    Ratio:
    The Court held that non-compliance with RMO No. 1-2000's 15-day prior
    application should not deny the petitioner the RP-Germany Tax Treaty benefits.
    Tax treaties aim to minimize or eliminate double taxation and should be honored in
    good faith.
    The Mirant case's minute resolution is not a binding precedent.
    RP-Germany Tax Treaty did not require any prerequisite for the preferential tax rate.
    BIR's administrative issuances should not impose additional requirements that
    negate international agreements' reliefs.
    The petitioner's substantial compliance by applying for treaty relief before filing for
    a refund was deemed sufficient.
    Denying the refund based solely on non-compliance with the 15-day period would
    defeat Section 229 of the NIRC, which provides remedies for recovering
    erroneously paid taxes.

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