Nothing Special   »   [go: up one dir, main page]
Scribd Logo
Upload

Welcome to Scribd!

  • 81 views

    PSALM vs. CIR - Digest

    Uploaded by

    Mark Genesis Rojas
    The Supreme Court ruled that the sale of two power plants by the Power Sector Assets and Liabilities Management Corporation (PSALM) was not subject to value-added tax (VAT). The sale was a governmental function mandated by law to privatize assets of the National Power Corporation, and was not done "in the course of trade or business." PSALM was created solely to sell off NPC assets in order to liquidate NPC's financial obligations, not to engage in commercial activity. Therefore, the sale of the power plants did not meet the statutory definition of being "in the course of trade or business" and was not subject to VAT.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    PSALM vs. CIR - Digest

    Uploaded by

    Mark Genesis Rojas
    81 views1 page
    The Supreme Court ruled that the sale of two power plants by the Power Sector Assets and Liabilities Management Corporation (PSALM) was not subject to value-added tax (VAT). The sale was a governmental function mandated by law to privatize assets of the National Power Corporation, and was not done "in the course of trade or business." PSALM was created solely to sell off NPC assets in order to liquidate NPC's financial obligations, not to engage in commercial activity. Therefore, the sale of the power plants did not meet the statutory definition of being "in the course of trade or business" and was not subject to VAT.

    Original Description:

    PSALM vs. CIR - Digest

    Copyright

    © © All Rights Reserved

    Available Formats

    DOCX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    The Supreme Court ruled that the sale of two power plants by the Power Sector Assets and Liabilities Management Corporation (PSALM) was not subject to value-added tax (VAT). The sale was a governmental function mandated by law to privatize assets of the National Power Corporation, and was not done "in the course of trade or business." PSALM was created solely to sell off NPC assets in order to liquidate NPC's financial obligations, not to engage in commercial activity. Therefore, the sale of the power plants did not meet the statutory definition of being "in the course of trade or business" and was not subject to VAT.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    81 views1 page

    PSALM vs. CIR - Digest

    Uploaded by

    Mark Genesis Rojas
    The Supreme Court ruled that the sale of two power plants by the Power Sector Assets and Liabilities Management Corporation (PSALM) was not subject to value-added tax (VAT). The sale was a governmental function mandated by law to privatize assets of the National Power Corporation, and was not done "in the course of trade or business." PSALM was created solely to sell off NPC assets in order to liquidate NPC's financial obligations, not to engage in commercial activity. Therefore, the sale of the power plants did not meet the statutory definition of being "in the course of trade or business" and was not subject to VAT.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    PSALM vs.

    CIR

    G.R. No. 198146, August 8, 2017

    Facts: Through the EPIRA Law, PSALM was created to facilitate the sale and privatization of the National
    Power Corporation. Two power plants was sold by PSALM. The BIR assessed the petitioner with VAT for
    the said sale. Petitioner then paid the assessed tax in protest and raised the issue with the DOJ. The DOJ
    rendered its judgement in favor of the Petitioner. The respondent appealed to the CA who reversed
    DOJ’s resolution. Petitioner then appealed to the SC, hence this case.

    Issue: Whether the sale of the power plants is subject to VAT?

    Held: No, The phrase ‘in the course of trade or business’ means the regular conduct or pursuit of a
    commercial or an economic activity, including transactions incidental thereto, by any person regardless
    of whether or not the person engaged therein is a nonstock, nonprofit private organization (irrespective
    of the disposition of its net income and whether or not it sells exclusively to members or their guests), or
    government entity. The sale of the power plants is not “in the course of trade or business” as
    contemplated under Section 105 of the NIRC, and thus, not subject to VAT.

    The sale of the power plants is not in pursuit of a commercial or economic activity but a governmental
    function mandated by law to privatize NPC generation assets. PSALM was created primarily to
    liquidate all NPC financial obligations and stranded contract costs in an optimal manner. The purpose
    and objective of PSALM are explicitly stated in Section 50 of the EPIRA law.

    PSALM is limited to selling only NPC assets and IPP contracts of NPC. The sale of NPC assets by PSALM is
    not “in the course of trade or business” but purely for the specific purpose of privatizing NPC assets in
    order to liquidate all NPC financial obligations. PSALM is tasked to sell and privatize the NPC assets
    within the term of its existence.

    You might also like