The Court ruled that the term "complete documents" referred to under Section 112 of the National Internal Revenue Code (NIRC) of 1997, as amended, should be construed as those documents necessary to support the legal basis of taxpayer's application for input VAT refund/credit as may be determined by the taxpayer bearing in mind that the "burden of proving entitlement to refund lies with the claimant"

The taxpayer filed an administrative claim for refund of its unutilized input VAT for the four quarters of taxable year 2002 with the Bureau Internal Revenue (BIR). Due to BIR’s inaction and to suspend the two-year prescriptive period under the NIRC of 1997, as amended, and Revenue Regulations No. 7-95, taxpayer filed a Petition for Review on April 22, 2004. The CIR argued that the law requires the submission of complete documents in support of the application filed with the BIR before the 120-day audit period shall apply, and before the taxpayer could avail of judicial remedies as provided for in the law. The CIR asserted that taxpayer merely submitted five (5) classes of documents in the administrative proceedings. CIR also asserted that the administrative claim was correctly denied by inaction due to its failure to submit complete documents as required. The Court ruled that the term "complete documents" referred to under Section 112 of the NIRC of 1997, as amended, should be construed as those documents necessary to support the legal basis of taxpayer's application for input VAT refund/credit as may be determined by the taxpayer bearing in mind that the "burden of proving entitlement to a refund lies with the claimant." Hence, the determination of what constitutes as complete documents should not be left at the sole discretion of the CIR. Otherwise, a taxpayer would be practically placed at the mercy of the CIR which may require production of documents that a taxpayer cannot submit. (Commissioner of Internal Revenue vs. Mirant Navotas Corporation, CTA Case No. 6960, December 20, 20114)