Strict compliance with 120+30 day period; refund or credit of input VAT

The requirements for a taxpayer be able to claim a refund or credit of its input tax are found in Section 112 of the NIRC, as amended, the relevant portions of which read:
Sec. 112. Refunds or Tax Credits of Input Tax.—

x x x x

(C) Period within which Refund or Tax Credit of Input Taxes shall be Made. — In proper cases, the Commissioner shall grant a refund or issue the tax credit certificate for creditable input taxes within one hundred twenty (120) days from the date of submission of complete documents in support of the application filed in accordance with Subsection (A) hereof.

In case of full or partial denial of the claim for tax refund or tax credit, or the failure on the part of the Commissioner to act on the application within the period prescribed above, the taxpayer affected may, within thirty (30) days from the receipt of the decision denying the claim or after the expiration of the one hundred twenty-day period, appeal the decision or the unacted claim with the Court of Tax Appeals.
Strict compliance with the 120+30 day period is necessary for a claim for a refund or credit of input VAT to prosper. An exception to that mandatory period was, however, recognized in San Roque[12] during the period between 10 December 2003, when BIR Ruling No. DA-489-03 was issued, and 6 October 2010, when the Court promulgated Aichi declaring the 120+30 day period mandatory and jurisdictional, thus reversing BIR Ruling No. DA-489-03.