CIR v. Nippon Express: CTA En Banc Can't Certiorari Its Own Division's Interlocutory Orders

In Commissioner of Internal Revenue v. Nippon Express Philippines Corporation (G.R. No. 271701, May 6, 2025), the Supreme Court En Banc held that the Court of Tax Appeals (CTA) En Banc has no certiorari jurisdiction over interlocutory orders of a CTA Division — Rule 65 petitions of that kind are cognizable by the Supreme Court. The Court denied the CIR’s petition and affirmed the CTA En Banc’s dismissal for lack of jurisdiction, even though the underlying ex parte dispute had become moot. This post is part of the Day in Court series.

Case details #

What happened #

Nippon Express Philippines Corporation filed a Petition for Review with the CTA Second Division on January 15, 2021 (CTA Case No. 10450), seeking a refund or tax credit certificate (TCC) of ₱43,068,852.54 for unutilized input value-added tax (VAT) attributable to zero-rated sales from April 1, 2018 to June 30, 2018.

After several extensions, the CIR electronically filed and served its Answer on May 6, 2021, but failed to file a timely hard copy as required. On July 21, 2021, the CTA Second Division set the case for ex parte presentation of Nippon Express’s evidence. The CIR moved for reconsideration, citing oversight by a reassigned handling lawyer and noting that a hard copy was eventually filed on October 4, 2021. The Division denied reconsideration on November 17, 2021, finding the former counsel’s negligence inexcusable and leaving the ex parte hearing in place.

The CIR then filed a Petition for Certiorari under Rule 65 with the CTA En Banc (CTA EB No. 2580), arguing grave abuse of discretion in allowing ex parte presentation. On August 29, 2023, the CTA En Banc dismissed the petition for lack of jurisdiction over interlocutory orders of a Division — the dismissal resulting from the lack of a majority vote in favor of the petition. The En Banc denied the CIR’s motion for reconsideration on January 26, 2024. The CIR elevated the jurisdictional question to the Supreme Court.

By the time the Supreme Court decided the case, the CTA Division had already decided the main VAT refund petition on the merits (Decision dated September 28, 2023; reconsideration denied January 29, 2024), rendering the ex parte controversy moot. The Court nevertheless resolved the jurisdictional issue as capable of repetition yet evading review and to formulate controlling principles.

The issue before the court #

Whether the CTA En Banc has jurisdiction to entertain a Rule 65 petition for certiorari challenging an interlocutory order of a CTA Division — or whether such petitions are cognizable only by the Supreme Court.

The ruling #

The Supreme Court denied the CIR’s petition and affirmed the CTA En Banc Decision dated August 29, 2023 and Resolution dated January 26, 2024.

Majority holding #

The majority, through Justice Zalameda, held that the CTA En Banc has no jurisdiction to entertain a petition for certiorari against interlocutory orders issued by a CTA Division. Such Rule 65 petitions are cognizable by the Supreme Court. Among the reasons the Court summarized:

1. The CTA En Banc’s jurisdiction is strictly appellate; certiorari presupposes a relationship of superiority.
2. Recognizing a hierarchy between the En Banc and the Divisions is contrary to the CTA’s nature as a collegial body.
3. The En Banc’s authority to review final decisions, resolutions, or orders of a Division does not transform it into a separate or superior court, nor vest it with supervisory power to issue certiorari against its Divisions.
4. It is inappropriate to allow Division members to sit En Banc and pass judgment on their own Division’s actions in a certiorari proceeding.
5. Certiorari power cannot be treated as an inherent power merely implied from appellate jurisdiction in this setting.
6. Legislative intent does not support granting the En Banc certiorari jurisdiction over Division interlocutory orders.

The Court therefore left interlocutory-order certiorari against CTA Divisions with the Supreme Court.

Separate opinions #

The decision drew real disagreement on the jurisdictional holding, even among Justices who agreed the petition should be denied as moot:

• Justice Leonen (Senior Associate Justice) — Concurring and Dissenting: concurred that the petition should be denied because the subject matter had become moot, but maintained that a Rule 65 petition challenging a CTA Division interlocutory order falls under the jurisdiction of the CTA En Banc.
• Justice Lazaro-Javier — Dissent: disagreed with the majority that the Supreme Court (not the CTA En Banc) has primary certiorari jurisdiction over Division interlocutory orders; she would recognize CTA En Banc certiorari power over such orders, including as necessary in aid of appellate jurisdiction and consistent with the hierarchy of courts.
• Justice Inting — Concurring and Dissenting: agreed the petition was moot, but dissented from the majority’s core ruling that the En Banc lacks certiorari jurisdiction over Division interlocutory orders.
• Justice M. Lopez — Dissenting: dissented from the majority’s exclusive-Supreme-Court jurisdictional conclusion; Justice Rosario joined Justice Lazaro-Javier’s dissent.
• Justice Caguioa — Concurring (separate concurring opinion). Justice Singh concurred (on leave). Chief Justice Gesmundo and others concurred with the majority.

Our insights #

A procedural map for CTA interlocutory disputes #

This case is not about whether Nippon Express was entitled to the VAT refund — the Division later denied that claim on the merits. The Supreme Court’s contribution is a clear filing map: if a party believes a CTA Division interlocutory order was issued with grave abuse of discretion, the Rule 65 forum identified by the majority is the Supreme Court, not the CTA En Banc. That distinguishes interlocutory review from the En Banc’s ordinary appellate review of final Division dispositions after reconsideration or new trial.

Tension with earlier CTA certiorari jurisprudence #

Both the CIR and several separate opinions invoked lines of authority that recognize CTA certiorari power in aid of appellate jurisdiction — including City of Manila v. Grecia-Cuerdo (certiorari over RTC interlocutory orders in local tax cases) and People v. Court of Tax Appeals – Third Division (certiorari over a Division judgment of acquittal). The majority treated interlocutory orders of a CTA Division as a different structural problem: within one collegial court, the En Banc is not a superior tribunal over its Divisions for Rule 65 purposes. The separate opinions read those same precedents as supporting En Banc certiorari here. Practitioners should note that the disagreement is documented in the primary text; the controlling holding for interlocutory Division orders is the majority rule.

Light connection to VAT refund practice #

The underlying dispute began as an input VAT refund/TCC claim on zero-rated sales — the same family of claims discussed in CIR v. San Roque Power on refund timing. Nippon Express itself is about forum and remedy, not refund rates or substantiation. Timing and documentation rules for VAT refunds remain governed by their own statutes and cases; this decision answers only where to file when the quarrel is an interlocutory CTA Division order.

What this means for taxpayers #

If you (or the BIR) are litigating before a CTA Division and an interlocutory order — default, ex parte presentation, discovery, and similar midstream rulings — is the problem:

• Do not assume a Rule 65 petition to the CTA En Banc is the correct next step for interlocutory Division orders under this holding; the majority places that certiorari petition with the Supreme Court.
• Preserve ordinary appellate avenues for final Division decisions (motion for reconsideration/new trial, then CTA En Banc appeal) separately from extraordinary certiorari over interlocutory rulings.
• Expect that mootness of the interlocutory fight (once the main case is decided) will not always stop the Supreme Court from clarifying the jurisdictional rule for future cases.
• Treat this as procedural guidance for CTA practice; it does not by itself decide the merits of a VAT refund or assessment.

Summary #

CIR v. Nippon Express settles a structural question inside the CTA: the En Banc does not sit as a certiorari court over its own Divisions’ interlocutory orders. The Supreme Court denied the CIR’s petition, affirmed the En Banc’s dismissal for lack of jurisdiction, and directed Rule 65 challenges of that kind to the Supreme Court — over separate opinions that would have kept such petitions with the En Banc. For parties in VAT refund or other CTA cases, the practical lesson is forum selection for interlocutory relief, not a change in refund substance. Related reading in this series includes CIR v. San Roque Power on VAT refund timing doctrine.

Sources #

Primary sources

• Supreme Court E-Library — G.R. No. 271701 Decision, May 6, 2025 (including separate opinions)

Secondary sources

• Sophos Notes / Philippine Law Reviewers — CIR v. Nippon Express Philippines Corporation, G.R. No. 271701 (May 6, 2025) decision text mirror