G.R. Nos.

141104 & 148763 June 8, 2007

ATLAS CONSOLIDATED MINING AND DEVELOPMENT CORPORATION v. CIR

CHICO-NAZARIO, J.:

FACTS:

When petitioner corporation’s claims for the refund/credit of the input VAT in the
taxable quarters of the years 1990 and 1992 was denied by the CTA and the CA, petitioner
corporation filed its motion for the re-opening of its cases and/or holding of new trial before the
CTA, contending that the failure of its counsel to adduce the necessary evidence should be
construed as excusable negligence or mistake, as counsel was of the belief that such evidence
was rendered unnecessary by the presentation of unrebutted evidence.

ISSUE: WON the failure of the counsel to adduce the necessary evidence can be construed as
excusable negligence or mistake

HELD: NO.

The non-presentation of the required documents, due to the fault of the counsel of
petitioner corporation, does not constitute excusable negligence or mistake which would warrant
the re-opening of the cases and/or holding of new trial.

Negligence, to be excusable, must be one which ordinary diligence and prudence could
not have guarded against. The counsel of petitioner corporation does not allege ignorance of the
foregoing administrative regulation and tax court circular, only that he no longer deemed it
necessary to present the documents required therein because of the presentation of
alleged unrebutted evidence of the zero-rated sales of petitioner corporation. It was a judgment
call made by the counsel as to which evidence to present in support of his clients cause, later
proved to be unwise, but not necessarily negligent.

Mistake, as it is referred to in Rule 37, must be a mistake of fact, not of law, which
relates to the case. In the present case, the supposed mistake made by the counsel of petitioner
corporation is one of law, for it was grounded on his interpretation and evaluation that Revenue
Regulations No. 3-88 and CTA Circular No. 1-95, as amended, did not apply to his client’s cases
and that there was no need to comply with the documentary requirements set forth therein.