1.1 TY VS.

TRAMPEs
G.R. NO. 117577, DEC. 1, 1995.
FACTS:
Petitioners were assessed by the municipal assessor for realty taxes over their real properties. They
asked for reconsideration and thinking this is not yet enough, they filed a petition for prohibition in the
RTC.
HELD:
Sec. 9 of P.D. 921 requires that the schedule of values of real properties in the Metropolitan Manila area
shall be prepared jointly by the city assessors in the districts created therein: while Sec. 212 of R.A. 7160
states that the schedule shall be prepared "by the provincial, city and municipal assessors of the
municipalities within the Metropolitan Manila Area for the different classes of real property situated in their
respective local government units for enactment by ordinance of the sanggunian concerned. . . ."
1. The assessor in each municipality or city in the Metropolitan Manila area shall prepare his/her
proposed schedule of values, in accordance with Sec. 212, R.A. 7160.
2. Then, the Local Treasury and Assessment District shall meet, per Sec. 9, P.D. 921. In the instant case,
that district shall be composed of the assessors in Quezon City, Pasig, Marikina, Mandaluyong and San
Juan, pursuant to Sec. 1 of said P.D. In this meeting, the different assessors shall compare their
individual assessments, discuss and thereafter jointly agree and produce a schedule of values for their
district, taking into account the preamble of said P.D. that they should evolve "a progressive revenue
raising program that will not unduly burden the taxpayers"
3. The schedule jointly agreed upon by the assessors shall then be published in a newspaper of general
circulation and submitted to the sanggunian concerned for enactment by ordinance, per Sec. 212, R.A.
7160.

Although as a rule, administrative remedies must first be exhausted before resort to judicial action can
prosper, there is a wellsettled exception in cases where the controversy does not involve questions of
fact but only of law. In the present case the parties, even during the proceedings in the lower court on 11
April 1994, already agreed "that the issues in the petition are legal", and thus, no evidence was presented
in said court.
the protest contemplated under Sec. 252 of R.A. 7160 is needed where there is a question as to the
reasonableness of the amount assessed. Hence, if a taxpayer disputes the reasonableness of an
increase in a real estate tax assessment, he is required to "first pay the tax" under protest. Otherwise, the
city or municipal treasurer will not
act on his protest. In the case at bench however, the petitioners are questioning the very authority and
power of the assessor, acting solely and independently, to impose the assessment and of the treasurer to
collect the tax. These are not questions merely of amounts of the increase in the tax but attacks on the
very validity of any increase.





1.2 Drilon v Lim G.R. NO. 112497 AUG 4, 1994

FACTS:
In his resolution, Secretary Drilon declared that there were no written notices of public hearings on the
proposed Manila Revenue Code that were sent to interested parties as required by Art. 276(b) of the
Implementing Rules of the Local Government Code nor were copies of the proposed ordinance published
in three successive issues of a newspaper of general circulation pursuant to Art. 276(a). No minutes were
submitted to show that the obligatory public hearings had been held. Neither were copies of the measure
as approved posted in prominent places in the city in accordance with Sec. 511(a) of the Local
Government Code. Finally, the Manila Revenue Code was not translated into Filipino or Tagalog and
disseminated among the people for their information and guidance, conformably to Sec. 59(b) of the
Code. Judge Palattao found otherwise. He declared that all the procedural requirements had been
observed in the enactment of the Manila Revenue Code and that the City of Manila had not been able to
prove such compliance before the Secretary only because he had given it only five days within which to
gather and present to him all the evidence (consisting of 25 exhibits) later submitted to the trial court.
HELD:
Section 187 authorizes the Secretary of Justice to review only the constitutionality or legality of the tax
ordinance and, if warranted, to revoke it on either or both of these grounds. When he alters or modifies or
sets aside a tax ordinance, he is not also permitted to substitute his own judgment for the judgment of the
local government that enacted the measure. Secretary Drilon did set aside the Manila Revenue Code, but
he did not replace it with his own version of what the Code should be. He did not pronounce the
ordinance unwise or unreasonable as a basis for its annulment. He did not say that in his judgment it was
a bad law.
What he found only was that it was illegal. All he did in reviewing the said measure was determine if the
petitioners were performing their functions in accordance with law, that is, with the prescribed procedure
for the enactment of tax ordinances and the grant of powers to the city government under the Local
Government Code.

The issue of noncompliance with the prescribed procedure in the enactment of the Manila Revenue
Code is another matter. The procedural requirements have indeed been observed.
The only exceptions are the posting of the ordinance as approved but this omission does not affect its
validity, considering that its publication in three successive issues of a newspaper of general circulation
will satisfy due process. It has also not been shown that the text of the ordinance has been translated and
disseminated, but this requirement applies to the approval of local development plans and public
investment programs of the local government unit and not to tax ordinances.






1.3 PHILIPPINE MATCH CO VS. CITY OF CEBU
L30745 JAN. 18 1978 WHERE THE SALE WAS BOOKED
FACTS:
Ordinance No. 279 of Cebu City (approved by the mayor on March 10, 1960 and also approved by the
provincial board) is "an ordinance imposing a quarterly tax on gross sales or receipts of merchants,
dealers, importers and manufacturers of any commodity doing business" in Cebu City. It imposes a sales
tax of one percent (1%) on the gross sales, receipts or value of commodities sold, bartered, exchanged or
manufactured in the city in excess of P2,000 a quarter. Section 9 of the ordinance provides that, for
purposes of the tax, "all deliveries of goods or commodities stored in the City of Cebu, or if not stored are
sold" in that city, "shall be
considered as sales" in the city and shall be taxable. Thus, it would seem that under the tax ordinance
sales of matches consummated outside of the city are taxable as long as the matches sold are taken from
the company's stock stored in Cebu City.
The Philippine Match Co., Ltd., whose principal office is in Manila, is engaged in the manufacture of
matches. Its factory is located at Punta, Sta. Ana, Manila. It ships cases or cartons of matches from
Manila to its branch office in Cebu City for storage, sale and distribution within the territories and districts
under its Cebu branch or the whole VisayasMindanao region. Cebu City itself is just one of the eleven
districts under the company's Cebu City branch office. Philippine Match sought the refund of a portion of
the sales tax collected from them by virtue of a part of it was assessed based on sales which transpired
outside of the city and that some of the matches were just stored in the city and delivered directly to
customers outside of Cebu. This was denied by the City Treasurer, prompting Philippine Match to file a
case in court.
The trial court characterized the tax on the other two transactions as a "storage tax" and not a sales tax. It
assumed that the sales were consummated outside of the city and, hence, beyond the city's taxing power.
The city did not appeal from that decision. The company appealed from that portion of the decision
upholding the tax on sales of matches to customers outside of the city but which sales were booked and
paid for in Cebu City, and also from the dismissal of its claim for damages against the city treasurer.

HELD:
The city can validly tax the sales of matches to customers outside of the city as long as the orders were
booked and paid for in the company's branch office in the city. Those matches can be regarded as sold in
the city, as contemplated in the ordinance, because the matches were delivered to the carrier in Cebu
City. Generally, delivery to the carrier is delivery to the buyer. A different interpretation would defeat the
tax ordinance in question or encourage tax evasion through the simple expedient of arranging for the
delivery of the matches at the out. skirts of the city through the purchase were effected and paid for in the
company's branch office in the city.

The taxing power of cities, municipalities and municipal districts may be used (1) "upon any person
engaged in any occupation or business, or exercising any privilege" therein; (2) for services rendered by
those political subdivisions or rendered in connection with any business, profession or occupation being
conducted therein, and (3) to levy, for public purposes, just and uniform taxes, licenses or fees.

Applying that jurisdictional test to the instant case, it is at once obvious that sales of matches to
customers outside oil Cebu City, which sales were booked and paid for in the company's branch office in
the city, are subject to the city's taxing power. The sales in the instant case were in the city and the
matches sold were stored in the city. The fact that the matches were delivered to customers, whose
places of business were outside of the city, would not place those sales beyond the city's taxing power.
Those sales formed part of the merchandising business being assigned on by the company in the city. In
essence, they are the same as sales of matches fully consummated in the city.

1.6 PLDT v City of Davao

Facts: PLDT paid a franchise tax equal to three percent (3%) of its gross receipts. The franchise tax was
paid in lieu of all taxes on this franchise or earnings thereof pursuant to RA 7082. The exemption from
all taxes on this franchise or earnings thereof was subsequently withdrawn by RA 7160 (LGC), which at
the same time gave local government units the power to tax businesses enjoying a franchise on the basis
of income received or earned by them within their territorial jurisdiction.
The LGC took effect on January 1, 1992.
The City of Davao enacted Ordinance No. 519, Series of 1992, which in pertinent part provides:
Notwithstanding any exemption granted by law or other special laws, there is hereby imposed a tax on
businesses enjoying a franchise, a rate of seventy-five percent (75%) of one percent (1%) of the gross
annual receipts for the preceding calendar year based on the income receipts realized within the territorial
jurisdiction of Davao City.
Subsequently, Congress granted in favor of Globe Mackay Cable and Radio Corporation (Globe) and
Smart Information Technologies, Inc. (Smart) franchises which contained in leiu of all taxes provisos.
In 1995, it enacted RA 7925, or the Public Telecommunication Policy of the Philippines, Sec. 23 of which
provides that any advantage, favor, privilege, exemption, or immunity granted under existing franchises,
or may hereafter be granted, shall ipso facto become part of previously granted telecommunications
franchises and shall be accorded immediately and unconditionally to the grantees of such franchises. The
law took effect on March 16, 1995.
In January 1999, when PLDT applied for a mayors permit to operate its Davao Metro exchange, it was
required to pay the local franchise tax which then had amounted to P3,681,985.72. PLDT challenged the
power of the city government to collect the local franchise tax and demanded a refund of what had been
paid as a local franchise tax for the year 1997 and for the first to the third quarters of 1998.

Issue: Whether or not by virtue of RA 7925, Sec. 23, PLDT is again entitled to the exemption from
payment of the local franchise tax in view of the grant of tax exemption to Globe and Smart.

Held: Petitioner contends that because their existing franchises contain in lieu of all taxes clauses, the
same grant of tax exemption must be deemed to have become ipso facto part of its previously granted
telecommunications franchise. But the rule is that tax exemptions should be granted only by a clear and
unequivocal provision of law expressed in a language too plain to be mistaken and assuming for the
nonce that the charters of Globe and of Smart grant tax exemptions, then this runabout way of granting
tax exemption to PLDT is not a direct, clear and unequivocal way of communicating the legislative
intent.
Nor does the term exemption in Sec. 23 of RA 7925 mean tax exemption. The term refers to exemption
from regulations and requirements imposed by the National Telecommunications Commission (NTC). For
instance, RA 7925, Sec. 17 provides: The Commission shall exempt any specific telecommunications
service from its rate or tariff regulations if the service has sufficient competition to ensure fair and
reasonable rates of tariffs. Another exemption granted by the law in line with its policy of deregulation is
the exemption from the requirement of securing permits from the NTC every time a telecommunications
company imports equipment.
Tax exemptions should be granted only by clear and unequivocal provision of law on the basis of
language too plain to be mistaken.


1.27
ESTANISLAO vs. HONORABLE AMADO COSTALES
FACTS:

Ordinance was passed by the Sangguniang Panglungsod of Zamboanga City on February 1982. The
Sanggunian sent a copy of theOrdinance to the then Minister of Finance by registered mail for hisreview
pursuant to P.D. No. 231, otherwise known as the Local TaxCode.
On December 1982, the Minister of Finance through Deputy MinisterRoman, Jr., sent the letter addressed
to the Sanggunian, suspendingthe effectivity of Ordinance No. 44 on the ground that it
contravenesSection 19(a) of the Local Tax Code.

On January 1983, the City Mayor of Zamboanga appealed the saiddecision of the Minister of Finance to
the RTC of Zamboanga.
RTC: Although the tax levied under said Ordinance is not among thosethat the Sanggunian may impose
under the Local Tax Code, it upheldits validity because the Minister of Finance did not take
appropriateaction on the matter within the prescribed period of 120 days afterreceipt of a copy thereof.
This petition for review on certiorari
was filed by the incumbent Secretary of Finance alleging that the trial court erred when it held that the
failure of the Minister of Finance to suspend the effectivity of Ordinance No. 44 within 120 days
from receipt of a copy thereof rendered said Ordinance valid.
ISSUE:Whether or not Ordinance No. 44 of Zamboanga City imposing P0.01 tax perliter of softdrinks
produced, manufactured, and/or bottled within theterritorial jurisdiction of the City is valid?
HELD:NO. It is null and void. Any taxes paid under protest should be accordingly refunded to the
taxpayers.
RATIO:
Section 19(a) and section 23 of the Local Tax Code allows for themunicipalities to impose tax on
businesses.
It is clear that a city, like Zamboanga, may impose, in lieu of thegraduated fixed tax prescribed under
Section 19 of the Local Tax Code,
a percentage tax on the gross sales for the preceding calendar year of non-essential commodities at the
rate of not exceeding two per cent and on the gross sales of essential commodities at the rate of
not exceeding one per cent.
Ordinance No. 44 of the respondent Zamboanga City imposes P0.01per liter of softdrinks
produced, manufactured, and/or bottled withinthe territorial jurisdiction of the City of Zamboanga.
Ordinance isultra vires as it is not within the authority of the Cityto impose said tax.
The authority of the City is limited to the imposition of apercentage tax on the gross sales or receipts of
said productwhich shall be at the rate of not exceeding 2% of the gross salesor receipts of the soft drinks
for the preceding calendar year.
The tax being imposed under said Ordinance is based on theoutput or production and not on the gross
sales or receiptsas authorized underthe Local Tax Code

Cagayan Robina Sugar Milling Co. vs. CA
GR No. 122451. October 12, 2000
Quisumbing, J.:

FACTS: in 1990 the Assets Privatization Trust (APT) offered for sale all assets and properties of
CASUCO, which had been foreclosed by DBP. The APT set the floor for said properties at
355,000,000Php. Petitioner herein was the highest bidder. On October 18, 1990, the provincial assessor
of Cagayan issued a Notice of Assessment of real property against the petitioner. On February 8, 1991
petitioner appealed the assessment to the LBAA on the ground that it was excessive, erroneous, and
unjust. LBAA resolved that the basis for market value for assessment purposes should be APT-setting
selling price. On November 25, 1992, petitioner appealed to CBAA but was dismissed for being filed out
of time. CA affirmed such decision, hence, this appeal.

ISSUE: Whether or not LBAA erred in determining the basis for fair market value
Whether or not the appeal was filed out of time.

HELD: the court ruled in negative
RATIO: Although section 28 of Real Property Tax Code provided for the formula for computing the
current market value of machines, it must, however, be read in consonance of section 3 of the same law.
Under the latter provision, the LBAA and CBAA were not precluded from adopting various approach to
the value determination, including the APT floor bid price.

The petitioners appeal to CBAA was also time-barred. The 30-day reglamentary period to perfect
an appeal had long elapsed.
LRTA vs. CBAA
GR No. 127316. October 12, 2000
Panganiban, J.:

FACTS: LRTA is a government-owned and controlled corporation and organized under EO 603. It is
primarily responsible for the construction, operation, maintenance, and/or lease of Light Rail Transit
System in the Philippines. LRTA acquired real properties including carriageways and passenger terminal
stations. The city assessor of manila assessed the real properties of the petitioner, which the latter paid
except on the carriageways and passenger terminal stations, including the land it constructed on the
ground that it was not taxable under Real Property Tax Code. This was denied by the city assessor. The
petitioner appealed to the local board of assessment appeals, which after due hearing, denied the same
and the CBAA also denied the appeal. The CA affirmed the latters decision. Hence, this appeal.

ISSUE: Whether or not the carriageway and the passenger terminal stations constructed on public lands
taxable under the real property tax code.

HELD: The court ruled in affirmative.

RATIO: Under the Real Property Tax Code, real property is classified for assessment purposes on the
basis of actual use, which is defined as the purpose for which the property is principally or predominantly
utilized by the person in possession of the property. Although the petitioner is a public utility, it is
nonetheless profit-earning. It actually uses the carriageways and terminal stations in its public utility
business and earns money therefrom. Furthermore, petitioner is not exempted from any real estate tax
under its charter.
City of Pasig vs. Republic of the Philippines
GR No. 185023. August 24, 2011
Carpio, J.:

FACTS: Mid-Pasig Land Development Corporation (MPLDC) owned two parcel of land located in Pasig
City. In 1986, the registered owner of MPLDC, Jose Campos, voluntarily surrendered MPLDC to the
Republic of the Philippines. On September 20, 2002, the Pasig City Assessors Office sent MPLDC two
notices of tax delinquency for its failure to pay real property tax. MPLDC claimed that the real properties
are now owned by the Republic, hence, exempted from tax. The City Treasurer claimed otherwise.
MPLDC paid a partial payment under protest. MPLDC received two warrants of levy by which the
properties were subsequently sold at a public auction. PCGG filed with RTC a petition for certiorari,
prohibition, and mandamus. RTC ruled in favor of PCGG but on appeal, CA reversed the decision. On
motion for reconsideration, the latter set aside its previous decision. Hence, this appeal.

ISSUE: Whether or not real properties already surrendered to the Republic still subject to real property
tax?

HELD: the court ruled in negative.

RATIO: As correctly found by RTC and CA, the Republic of the Philippines now owned the said
properties when Campos surrendered such to PCGG. Section 234(a) of RA No. 7160 states that
properties owned by the Republic of the Philippines are exempted from real property tax except when
beneficial use thereof has been granted, for consideration or otherwise, to taxable persons. In sum, only
portions of the real property leased to taxable entities are subject to real property tax.
2.1 LUNG CENTER OF THE PHILIPPINES v. QUEZON CITY
Facts: Lung Center of the Philippines is a non-stock and non-profit entity established by virtue of PD No.
1823. It is the registered owner of the land on which the Lung Center of the Philippines Hospital is
erected. A big space in the ground floor of the hospital is beingleased to private parties, for canteen and
small store spaces, and to medical or professional practitioners who use the same as their private clinics.
Also, a big portion on the right side of the hospital is being leased for commercial purposes to a private
enterprise known as the Elliptical Orchids and Garden Center.

When the City Assessor of Quezon City assessed both its land andhospital building for real
property taxes, the Lung Center of the Philippines filed a claim for exemption on its averment that it is a
charitable institution with a minimum of 60% of its hospital beds exclusively used for charity patients and
that the major thrust of itshospital operation is to serve charity patients. The claim for exemption was
denied, prompting a petition for the reversal of the resolution of the City Assessor with the Local Board of
Assessment Appeals of Quezon City, which denied the same. On appeal, the Central Board of
Assessment Appeals of Quezon City affirmed the local boards decision, finding that Lung Center of the
Philippines is not a charitable institution and that its properties were not actually, directly and exclusively
used for charitable purposes. Hence, thepresent petition for review with averments that the Lung Center
of the Philippines is a charitable institution under Section 28(3), Article VI of the Constitution,
notwithstanding that it accepts paying patients and rents out portions of the hospital building to
private individuals and enterprises.

Issue: Is the Lung Center of the Philippines a charitable institution within the context of the Constitution,
and therefore, exempt from real property tax?

Held: The Lung Center of the Philippines is a charitable institution. To determine whether an enterprise is
a charitable institution or not, the elements which should be considered include the statute creating the
enterprise, its corporate purposes, its constitution and by-laws, the methods of administration, the nature
of the actual work performed, that character of the services rendered, the indefiniteness of the
beneficiaries and the use and occupation of the properties.
________________

However, under the Constitution, in order to be entitled to exemption from real property tax, there must be
clear and unequivocal proof that (1) it is a charitable institution and (2)its real properties are ACTUALLY,
DIRECTLY and EXCLUSIVELY used for charitable purposes. While portions of the hospital are used for
treatment of patients and the dispensation of medical services to them, whether paying or non-paying,
other portions thereof are being leased to private individuals and enterprises.

Exclusive is defined as possessed and enjoyed to the exclusion of others, debarred from participation or
enjoyment. If real property is used for one or more commercial purposes, it is not exclusively used for the
exempted purposes but is subject to taxation.


2.3 MANILA INTERNATIONAL AIRPORT AUTHORITY VS CA
GR No. 155650, July 20, 2006, 495 SCRA 591
Facts:
Manila International Airport Authority (MIAA) is the operator of the Ninoy International Airport located at
Paranaque City. The Officers of Paranaque City sent notices to MIAA due to real estate taxdelinquency.
MIAA then settled some of the amount. When MIAA failed to settle the entire amount, theofficers of
Paranaque city threatened to levy and subject to auction the land and buildings of MIAA,which they did.
MIAA sought for a Temporary Restraining Order from the CA but failed to do so withinthe 60 days
reglementary period, so the petition was dismissed. MIAA then sought for the TRO with theSupreme
Court a day before the public auction, MIAA was granted with the TRO but unfortunately theTRO was
received by the Paranaque City officers 3 hours after the public auction.MIAA claims that although the
charter provides that the title of the land and building are with MIAA still the ownership is with the
Republic of the Philippines. MIAA also contends that it is aninstrumentality of the government and as
such exempted from real estate tax. That the land and buildingsof MIAA are of public dominion therefore
cannot be subjected to levy and auction sale. On the other hand, the officers of Paranaque City claim that
MIAA is a government owned and controlled corporationtherefore not exempted to real estate tax.
Issues:Whether or not MIAA is an instrumentality of the government and not a government owned
andcontrolled corporation and as such exempted from tax.Whether or not the land and buildings of MIAA
are part of the public dominion and thus cannot be the subject of levy and auction sale.
Ruling:Under the Local
government code, government owned and controlled corporations are notexempted from real estate tax.
MIAA is not a government owned and controlled corporation, for to become one MIAA should either be a
stock or non stock corporation. MIAA is not a stock corporation for its capital is not divided into shares. It
is not a non stock corporation since it has no members. MIAA is aninstrumentality of the government
vested with corporate powers and government functions.Under the civil code, property may either be
under public dominion or private ownership. Thoseunder public dominion are owned by the State and are
utilized for public use, public service and for thedevelopment of national wealth. The ports included in the
public dominion pertain either to seaports or airports. When properties under public dominion cease to be
for public use and service, they form part of the patrimonial property of the State.The court held that the
land and buildings of MIAA are part of the public dominion. Since theairport is devoted for public use, for
the domestic and international travel and transportation. Even if MIAA charge fees, this is for support of
its operation and for regulation and does not change the character of the land and buildings of MIAA as
part of the public dominion. As part of the public dominion the landand buildings of MIAA are outside the
commerce of man. To subject them to levy and public auction iscontrary to public policy. Unless the
President issues a proclamation withdrawing the airport land and buildings from public use, these
properties remain to be of public dominion and are inalienable. As longas the land and buildings are for
public use the ownership is with the Republic of the Philippines.


2.4 CITY GOVERNMENT OF QUEZON vs. BAYANTEL
G.R. No. 162015
Petitioners: The City Government of Quezon City, and The City Treasurer of Quezon City,Dr. Victor B.
EnrigaRespondent: Bayan Telecommunications, Inc. March 6, 2006
FACTS:
Respondent Bayan Telecommunications, Inc. (Bayantel) is a legislative franchise holder under Republic
Act (Rep. Act) No. 3259 to establish and operate radio stations fordomestic telecommunications,
radiophone, broadcasting and telecasting. On January 1,1992, Rep. Act No. 7160, otherwise known as
the "Local Government Code of 1991" (LGC),took effect. Section 232 of the Code grants local
government units within the Metro ManilaArea the power to levy tax on real properties. On July 20,
1992, barely few months after theLGC took effect, Congress enacted Rep. Act No. 7633, amending
Bayantels originalfranchise.
The amendatory law (Rep. Act No. 7633) contained the following tax provision: Itis undisputed that within
the territorial boundary of Quezon City, Bayantel owned severalreal properties on which it maintained
various telecommunications facilities. In 1993, thegovernment of Quezon City, pursuant to the taxing
power vested on local government unitsby Section 5, Article X of the 1987 Constitution, in relation to
Section 232 of the LGC,enacted City Ordinance No. SP-91, S-93, otherwise known as the Quezon City
Revenue Code(QCRC), imposing, under Section 5 thereof, a real property tax on all real properties
inQuezon City, and, reiterating in its Section 6, the withdrawal of exemption from realproperty tax under
Section 234 of the LGC. On March 16, 1995, Rep. Act No. 7925,otherwise known as the "Public
Telecommunications Policy Act of the Philippines,"envisaged to level the playing field among
telecommunications companies, took effect. OnJanuary 7, 1999, Bayantel wrote the office of the City
Assessor seeking the exclusion of itsreal properties in the city from the roll of taxable real properties. With
its request havingbeen denied, Bayantel interposed an appeal with the Local Board of Assessment
Appeals(LBAA). And, evidently on its firm belief of its exempt status, Bayantel did not pay the realproperty
taxes assessed against it by the Quezon City government. On account thereof, theQuezon City Treasurer
sent out notices of delinquency for the total amount ofP43,878,208.18, followed by the issuance of
several warrants of levy against Bayantels properties preparatory to their sale at a public auction set on
July 30, 2002. Threatened with the imminent loss of its properties, Bayantel immediately withdrew its
appeal withthe LBAA and instead filed with the RTC of Quezon City a petition for prohibition with anurgent
application for a temporary restraining order (TRO) and/or writ of preliminaryinjunction. The trial court
ruled in favor of respondent.
ISSUES:
1. Whether or not Bayantels real properties in Quezon City are exempt from real propertytaxes under its
legislative franchise; and

2. Whether or not Bayantel is required to exhaust administrative remedies before seeking judicial relief
with the trial court.
HELD:
The power to tax is primarily vested in the Congress; however, in our jurisdiction, itmay be exercised by
local legislative bodies, no longer merely be virtue of a valid delegationas before, but pursuant to direct
authority conferred by Section 5, Article X of theConstitution. Under the latter, the exercise of the power
may be subject to such guidelinesand limitations as the Congress may provide which, however, must be
consistent with thebasic policy of local autonomy. Clearly then, while a new slant on the subject of
localtaxation now prevails in the sense that the former doctrine of local government unitsdelegated power
to tax had been effectively modified with Article X, Section 5 of the 1987Constitution now in place, the
basic doctrine on local taxation remains essentially the same.For as the Court stressed in Mactan, "the
power to tax is primarily vested in the Congress."Indeed, the grant of taxing powers to local government
units under the Constitution andthe LGC does not affect the power of Congress to grant exemptions to
certain persons,pursuant to a declared national policy. The legal effect of the constitutional grant to
localgovernments simply means that in interpreting statutory provisions on municipal taxingpowers,
doubts must be resolved in favor of municipal corporations. Petitions forprohibition are governed by the
provision of Rule 65 of the Rules of Court. With the realitythat Bayantels real properties were already
levied upon on account of its nonpayment ofreal estate taxes thereon, the Court agrees with Bayantel
that an appeal to the LBAA is not aspeedy and adequate remedy within the context of the aforequoted
Section 2 of Rule 65.This is not to mention of the auction sale of said properties already scheduled on
July 30,2002. Moreover, one of the recognized exceptions to the exhaustion- of-administrativeremedies
rule is when, as here, only legal issues are to be resolved. In fact, the Court,cognizant of the nature of the
questions presently involved, gave due course to the instantpetition. As the Court has said in Ty vs.
Trampe:xxx. Although as a rule, administrative remedies must first be exhausted
beforeresort to judicial action can prosper; there is a well-settled exception in cases where thecontroversy
does not involve questions of fact but onlyof law.


STA LUCIA REALTY v. CITY OF PASIG
[JUNE 15, 2011]

FACTS:
Petitioner Sta. Lucia Realty & Development, Inc. (Sta. Lucia) is the registered owner of several parcels of
landwith Transfer Certificates of Title (TCT) Nos. 39112, 39110 and 38457, all of which indicated that the
lots werelocated in Barrio Tatlong Kawayan, Municipality of Pasig.The parcel of land covered by TCT No.
39112 was consolidated with that covered by TCT No. 518403, whichwas situated in Barrio Tatlong
Kawayan, Municipality of Cainta, Province of Rizal Cainta

The two combinedlots were subsequently partitioned into three, for which TCT Nos. 532250,
598424, and 599131, now all bearingthe Cainta address, were issued.The lot covered by TCT No. 38457
was not segregated, but a commercial building owned by Sta. Lucia East Commercial Center, Inc., a
separate corporation, was built on it.

Upon Pasigs petition to correct the location stated in TCT Nos. 532250, 598424, and 599131, the Land
Registration Court, on June 9, 1995, ordered the amendment of the TCTs to read that the lots with
respect toTCT No. 39112 were located in Barrio Tatlong Kawayan, Pasig City.On January 31, 1994,
Cainta filed a petitionfor the settlement of its land boundary dispute with Pasig before theRTC, Branch 74
of Antipolo City (Antipolo RTC). This case, docketed as Civil Case No. 94-3006, is still pendingup to this
date.On November 28, 1995, Pasig filed a Complaint, docketed as Civil Case No. 65420, against Sta.
Lucia for thecollection of real estate taxes, including penalties and interests, on the lots covered by TCT
Nos. 532250,598424, 599131, 92869, 92870 and 38457, including the improvements thereon (the subject
properties).Sta. Lucia, in its Answer, alleged that it had been religiously paying its real estate taxes to
Cainta, just like what its predecessors-in-interest did, by virtue of the demands and assessments made
and the Tax Declarationsissued by Cainta on the claim that the subject properties were within its territorial
jurisdiction.

The RTC denied this in an Order dated December 4, 1996 for lack of merit. Holding that the TCTs were
conclusive evidence as to its ownership and location, the RTC, on August 10, 1998, rendered a Decision
in favor of Pasig .On April 15, 1999, the RTC ordered the issuance of a Writ of Execution against Sta.
Lucia. On May 21, 1999, Sta. Lucia filed a Petition for Certiorari
Undaunted, Sta. Lucia and Cainta filed separate Petitions for
Certiorari
.
ISSUES:
1) Whether the RTC and the CA were correct in deciding Pasigs Complaint without waiting for the resolution of
the boundary dispute case between Pasig and Cainta; and2) Whether Sta. Lucia should continue paying
its real property taxes to Cainta, as it alleged to have always done, or to Pasig, as the location stated in
Sta. Lucias TCTs.

HELD:
We agree with the CA that the resolution of the boundary dispute between Pasig and Cainta would
determine which local government unit is entitled to collect realty taxes from Sta. Lucia.
The Local Government Unit entitled To Collect Real Property Taxes. A certificate of title is conclusive
evidence of both its ownership and location. The Court of Appeals even referred to specific provisions of
the 1991 Local Government Code and Act. No. 496 to support its ruling that Pasig had the right tocollect
the realty taxes. Presidential Decree No. 464 or the Real Property Tax Code, the authority to collect real
property taxes is vested in the locality where the property is situated.

TY VS. TRAMPE
G.R. NO. 117577, DEC. 1, 1995.

FACTS:
Petitioners were assessed by the municipal assessor for realty taxes over their real properties. They
asked for reconsideration and thinking this is not yet enough, they filed a petition for prohibition in the
RTC.

Sec. 9 of P.D. 921 requires that the schedule of values of real properties in the Metropolitan Manila area
shall be prepared jointly by the city assessors in the districts created therein: while Sec. 212 of R.A. 7160
states that the schedule shall be prepared "by the provincial, city and municipal assessors of the
municipalities within the Metropolitan Manila Area for the different classes of real property situated in their
respective local government units for enactment by ordinance of the sanggunian concerned. . . ." It is
obvious that harmony in these provisions is not only possible, but in fact desirable, necessary and
consistent with the legislative intent and policy. By reading together and harmonizing these two
provisions, we arrive at the following steps in the preparation of the said schedule, as follows:

1. The assessor in each municipality or city in the Metropolitan Manila area shall prepare his/her
proposed schedule of values, in accordance with Sec. 212, R.A. 7160.

2. Then, the Local Treasury and Assessment District shall meet, per Sec. 9, P.D. 921. In the instant case,
that district shall be composed of the assessors in Quezon City, Pasig, Marikina, Mandaluyong and San
Juan, pursuant to Sec. 1 of said P.D. In this meeting, the different assessors shall compare their
individual assessments, discuss and thereafter jointly agree and produce a schedule of values for their
district, taking into account the preamble of said P.D. that they should evolve "a progressive revenue
raising program that will not unduly burden the taxpayers"

3. The schedule jointly agreed upon by the assessors shall then be published in a newspaper of general
circulation and submitted to the sanggunian concerned for enactment by ordinance, per Sec. 212, R.A.
7160.

ISSUE: WON the proper procedure in the prepapration of the schedule has been complies with

RULING:
Although as a rule, administrative remedies must first be exhausted before resort to judicial action can
prosper, there is a wellsettled exception in cases where the controversy does not involve questions of
fact but only of law. In the present case the parties, even during the proceedings in the lower court on 11
April 1994, already agreed "that the issues in the petition are legal", and thus, no evidence was presented
in said court.

In laying down the powers of the Local Board of Assessment Appeals, R.A. 7160 provides in Sec. 229 (b)
that "(t)he proceedings of the Board shall be conducted solely for the purpose of ascertaining the facts . . .
." It follows that appeals to this Board may be fruitful only where questions of fact are involved. Again, the
protest contemplated under Sec. 252 of R.A. 7160 is needed where there is a question as to the
reasonableness of the amount assessed. Hence, if a taxpayer disputes the reasonableness of an
increase in a real estate tax assessment, he is required to "first pay the tax" under protest. Otherwise, the
city or municipal treasurer will not act on his protest. In the case at bench however, the petitioners are
questioning the very authority and power of the assessor, acting solely and independently, to impose the
assessment and of the treasurer to collect the tax. These are not questions merely of amounts of the
increase in the tax but attacks on the very validity of any increase.

Mactan Cebu (MCIAA) vs. Marcos
GR 120082 September 11, 1996 261 SCRA 667
Davide Jr., .: (CJ)
FACTS:
Mactan Cebu International Airport Authority (MCIAA) was created to principally undertake to economical,
efficient and effective control, management and supervision of the Mactan International Airport and
such other airports as may be established in the province of Cebu Section 14 of its charter excempts
the Authority from payment of realty taxes but in 1994, the City Treasurer demanded payment for realty
taxes on several parcels of land belonging to the other. MCIAA filed a petition in RTC contending that, by
nature of its powers and functions, it has the same footing of an agency or instrumentality of the national
government. The RTC dismissed the petition based on Section 193 & 234 of the local Government Code
or R.A. 7160. Thus this petition.
ISSUE:
Whether or not the MCIAA is exempted from realty taxes?
RULING:
With the repealing clause of RA 7160 the tax exemption provided. All general and special in the charter
of the MCIAA has been expressly repeated. It state laws, acts, City Charters, decrees, executive orders,
proclamations and administrative regulations, or part of parts thereof which are inconsistent with any of
the provisions of the Code are hereby repeated or modified accordingly. Therefore the SC affirmed the
decision and order of the RTC and herein petitioner has to pay the assessed realty tax of its properties
effective January 1, 1992 up to the present.

Mindanao Bus vs City Assessor (Cagayan de Oro City)

Facts: Petitioner is a public utility company engaged in the transport of passengers and cargo by motor
vehicles in Mindanao with main offices in Cagayan de Oro (CDO). Petitioner likewise owned a land where
it maintains a garage, a repair shop and blacksmith or carpentry shops. The machineries are placed
thereon in wooden and cement platforms. The City Assessor of CDO then assessed a P4,400 realty tax
on said machineries and repair equipment. Petitioner appealed to the Board of Tax Appeals but it
sustained the City Assessor's decision, while the Court of Tax Appeals (CTA) sustained the same.
Issue: Whether or not the machineries and equipments are considered immobilized and thus
subject to a realty tax
Held: The Supreme Court decided otherwise and held that said machineries and equipments are not
subject to the assessment of real estate tax.
Said equipment are not considered immobilized as they are merely incidental, not esential and principal
to the business of the petitioner. The transportation business could be carried on without repair or service
shops of its rolling equipment as they can be repaired or services in another shop belonging to another

2.11 CALTEX (PHILIPPINES) INC. vs. CENTRAL BOARD OF ASSESSMENT APPEALS and CITY
ASSESSOR OF PASAY
G.R. No. L-50466 May 31, 1982

FACTS: The city assessor of Pasay City assessed several items of gas station equipment and machinery
installed by petitioner in its gas stations as taxable realty. The machines and equipment consists of
underground tanks, elevated tank, elevated water tanks, water tanks, gasoline pumps, computing pumps,
water pumps, car washer, car hoists, truck hoists, air compressors and tireflators. The realty tax on said
equipment amounts to P4,541.10 annually. The city board of tax appeals ruled that they are personalty
and thus not subject to realty tax. The Central Board of Assessment Appeals ruled that they are real
property.

ISSUE: Whether the pieces of gas station equipment and machinery are subject to realty tax

RULING: Yes. The said equipment and machinery, as appurtenances to the gas station building or shed
owned by petitioner and which fixtures are necessary to the operation of the gas station, for without them
the gas station would be useless, and which have been attached or affixed permanently to the gas station
site or embedded therein, are taxable improvements and machinery within the meaning of the
Assessment Law and the Real Property Tax Code. Improvements on land are commonly taxed as realty
even though for some purposes they might be considered personalty. It is a familiar phenomenon to see
things classed as real property for purposes of taxation which on general principle might be considered
personal property.






2.12 MERALCO SECURITIES INDUSTRIAL CORPORATION vs. CENTRAL BOARD OF ASSESSMENT
APPEALS, BOARD OF ASSESSMENT APPEALS OF LAGUNA and PROVINCIAL ASSESSOR OF
LAGUNA
G.R. No. L-46245 May 31, 1982

FACTS: Pursuant to a pipeline concession issued under the Petroleum Act of 1949, Republic Act No.
387, petitioner installed from Batangas to Manila a pipeline system consisting of cylindrical steel pipes
joined together and buried not less than one meter below the surface along the shoulder of the public
highway. The provincial assessor of Laguna treated the pipeline as real property subject to realty tax. The
Board of Assessment Appeals of Laguna and the Central Board of Assessment Appeals upheld the
assessments.

ISSUE: Whether the pipeline system is subject to realty tax

RULING: Yes. Article 415[l] and [3] of the Civil Code provides that real property may consist
of constructions of all kinds adhered to the soil and everything attached to an immovable in a fixed
manner, in such a way that it cannot be separated therefrom without breaking the material or deterioration
of the object. The pipeline system in question is indubitably a construction adhering to the soil. It is
attached to the land in such a way that it cannot be separated therefrom without dismantling the steel
pipes which were welded to form the pipeline. Insofar as the pipeline uses valves, pumps and control
devices to maintain the flow of oil, it is in a sense machinery within the meaning of the Real Property Tax
Code. Moreover, petitioner is exempted only from local taxes or levies and not from taxes of general
application. Realty tax has always been imposed by the national lawmaking body. It is enforced
throughout the Philippines and not merely in a particular municipality or city but the proceeds of the tax
accrue to the province, city, municipality and barrio where the realty taxed is situated.



2.13 CITY OF BAGUIO vs. FERNANDO S. BUSUEGO
G.R. No. L-29772 September 18, 1980

FACTS: A collection suit for real estate tax was instituted by the City of Baguio against Fernando S.
Busuego. The title of the property is under the name of GSIS (the seller), although Busuego (installment
purchaser) is already using the same pursuant to a Contract to Sell executed by them. The city court
rendered judgment in favor of the City of Baguio. This was affirmed by the court of first instance. Busuego
contends that there is no obligation to pay real estate tax because the title to the property has not passed
to him and thus, ownership remains with GSIS which is exempt from taxes.

ISSUE: Whether Busuego is liable for real estate tax

RULING: Yes. Although the property was still in the name of the GSIS, the stipulation in their contract that
the purchaser on installments should pay the real estate taxes pending completion of payments is valid
and binding, absent any law to the contrary. Moreover, while the GSIS may be exempt from real estate
tax, its exemption does not cover property belonging to it "where the beneficial use thereof has been
granted for consideration or otherwise to a taxable person" pursuant to Section 40(a) of P.D. No. 464 or
the The Real Property Tax Code. While this decree was still inexistent at the time the taxes at issue were
assessed, indeed its provision sheds light upon the legislative intent behind the provision of C.A. No. 186,
pertaining to exemption of the GSIS from taxes. Finally, the end result is in line with the fundamental rule
that tax-exempting provisions of law are to be construed in strictissimi juris.







2.14 SOCIAL SECURITY SYSTEM vs. CITY OF BACOLOD and MIGUEL REYNALDO as City Treasurer
of Bacolod City
G.R. No. L-35726 July 21, 1982

FACTS: For petitioner's failure to pay the realty taxes for the years 1968, 1969 and 1970 which, including
penalties, amounted to P104,956.06, respondent city levied upon petitioners lands and building. Said
properties were then forfeited in its favor. Petitioner sought reconsideration of the forfeiture proceedings
on the ground that petitioner, being a government-owned and controlled corporation, is exempt from
payment of real estate taxes. When no action thereon was taken, petitioner filed an action in the Court of
First Instance for nullification of the forfeiture proceedings. The lower court ruled in favor of the
respondents.

ISSUE: Whether the properties in question, which are concededly owned by the government, are exempt
from realty taxes

RULING: Yes. When the legislature exempted lands and buildings owned by the government from
payment of said taxes, what it intended was a broad and comprehensive application of such mandate,
regardless of whether such property is devoted to governmental or proprietary purpose. Moreover, taxes
are financial burdens imposed for the purpose of raising revenues with which to defray the cost of the
operation of the Government, and a tax on property of the Government, whether national or local, would
merely have the effect of taking money from one pocket to put it in another pocket. It is axiomatic that
when public property is involved, exemption is the rule and taxation, the exception.






2.15 THE BOARD OF ASSESSMENT APPEALS OF ZAMBOANGA DEL SUR and PLACIDO L.
LUMBAY, in his capacity as Provincial Assessor of Zamboanga del Sur v. SAMAR MINING COMPANY,
INC. and THE COURT OF TAX APPEALS
G.R. No. L-28034. February 27, 1971

FACTS: Samar is a domestic corporation engaged in the mining industry. Since the mining claims and the
mill of Samar are located inland and at a great distance from the loading point or pier site, it decided to
construct a gravel road as a convenient means of hauling its ores. On June 5, 1964, Samar received a
letter from the Provincial Assessor of Zamboanga del Sur assessing it with real estate tax in the total sum
of P1,117,900.00. Samar appealed to the Board of Assessment Appeals which affirmed the validity of the
assessment. The Court of Tax Appeals reversed the BOAAs decision.

ISSUE: Whether Samar should pay realty tax

RULING: No. Under Section 3(a) of the Assessment Law (Com. Act 470), all properties owned by the
government, without any distinction, are exempt from taxation. The ownership of the road belongs to the
government by right of accession not only because it is inherently incorporated or attached to the land
leased to Samar but also because upon the expiration of the concession, said road would ultimately pass
to the national government. Moreover, while the road was constructed by Samar primarily for its use and
benefit, the privilege is not exclusive, for, under the lease contract, its use can also be availed of by the
employees of the government and by the public in general. Hence, Samar should not be held liable for
realty taxes.







2.16 CITY TREASURER OF QUEZON CITY vs. COURT OF APPEALS and BERNARDITA C.
TOLENTINO
G.R. No. 120974 December 22, 1997

FACTS: Alberto Sta. Maria owned a parcel of land which he sold in 1964 to Teresa L. Valencia. She
however failed to have the tax declaration transferred in her name. Thus she paid the real estate taxes
under the name of Sta. Maria. In 1973, Valencia sold the land to respondent Bernardita C. Tolentino.
However, from 1979 to 1983 Valencia failed to pay the real estate taxes due on the land. As a result,
notices of tax delinquency and intent to sell the property were sent to Sta. Maria's address. In the auction
sale, the spouses Romeo and Verna Chua bought the land in question and demanded delivery of its
possession. As a consequence, Tolentino sued for annulment of the auction sale in the Regional Trial
Court of Quezon City. The trial court granted the petition. The Court of Appeals affirmed the court a quo.

ISSUE: Whether the auction sale should be annulled

RULING: Yes. The notification to the right person, i.e., the real owner, is an essential and indispensable
requirement of the law, non-compliance of which renders the auction sale void. For one who is no longer
the lawful owner of the land cannot be considered the "present registered owner" because, apparently, he
has already lost interest in the property, hence is not expected to defend the property from the sale at
auction. The purpose of PD No. 464 is to collect taxes from the delinquent taxpayer and, logically, one
who is no longer the owner of the property cannot be considered the delinquent taxpayer. Plainly, at the
time of the auction sale, Alberto Sta. Maria who appeared to have been notified of the auction sale
was no longer the registered owner, much less the delinquent taxpayer. Hence, the sale should be
annulled.


Jaime Lopez vs. City of Manila
GR No. 127139. February 19, 1999
Quisumbing, J.:

FACTS: Although RA 7160 or the Local Government Code of 1991 took effect on January 1, 1992, the
revision of real property assessment prescribed therein was not yet enforced in the City of Manila. In
1995, Mrs. Laderas, the newly appointed assessor, received Memorandum form the Department of
Finance for failure of most cities and municipalities to conduct general revision of real property
assessment. In September 1995, the City Assessors Office submitted the proposed schedule of fair
market value to the city council for its appropriate action. After the public hearing and three readings and
the approval of city mayor, Manila Ordinance No. 7894 took effect on January 1, 1996, which increases
the value of tax on real property. Petitioner, Jaime Lopez, filed a special proceeding for the declaration of
nullity of the said ordinance with preliminary injunction and prayer of TRO. He contended that the
ordinance is unjust, excessive, oppressive, or confiscatory. On the same date, Manila Ordinance No.
7905 took effect, reducing the assessment level by 50%. Despite of the amendment, RTC acted on the
motion which granted it in favor of the petitioner and dismissed the motion of the City of Manila which
contends that it should be dismissed on the ground of failure to exhaust administrative remedies. On
motion for reconsideration, the court granted the motion, hence, this petition.

ISSUE: Whether or not the petitioner failed to exhaust administrative remedies.

HELD: The court ruled in affirmative.

RATIO: As a general rule, where the law provides for the remedies against action of an administrative
board, body, or officer, relief to the court can be sought only after exhaustion of all remedies provided.
The reason rests upon the presumption that the administrative bodies, if given a chance to correct its
mistake or error, may amend its decision on the given matter and decide it properly. This rule, however,
admits certain exceptions. The rule is well-settled that courts will not interfere in matters which are
addressed to the sound discretion of the government agencies entrusted with the regulations of activities
coming under special technical knowledge and training of agencies. Among the exceptional cases are: (1)
when questions raised is purely legal; (2) when administrative body is in estoppel; (3) when the act
complained of is patently illegal; (4) when there is urgent need for judicial intervention; (5) when claim
involved is small; (6) when irreparable damage will be suffered; (7) when there is no other plain, speedy,
and adequate remedy; (8) when strong public interest is involved; (9) when the subject of controversy is
private land; and (10) in quo-warranto proceedings. The instant petition does not, however, fall in the
exception.
Commissioner of Customs vs. AGFHA Inc.
GR No. 187425. March 28, 2011
Mendoza, J.:

FACTS: On December 12, 1993, shipment for AGFHA arrived in Manila. Commissioner, however, held
the subject shipment because its owner/consignee was allegedly fictitious. AGFHA intervened and
claimed that it was the owner thereof. After the seizure, AGFHA appealed to the Commissioner, which
dismissed it. In the CTA, the court reversed the decision of the Commissioner. When the decision
became final and executory, AGFHA filed a motion for execution but was held in abeyance due to the
Commissioners appeal to CA. CA and SC denied it for lack of merit. Commissioner, however, could not
return the seized goods because it was alleged to be lost. CTA made the Commissioner liable for the
value of the goods at the time of payment and CTA en banc affirmed such. Commissioner contends that it
cannot be held liable because it will be in a sense a suit against the state and which the Bureau is
immune.

ISSUE: Whether or not the BOC can be made liable for the goods lost which was seized by them.

HELD: The court ruled in affirmative.

RATIO: As already ruled in number of cases, the rate of exchange for conversion in peso equivalent
should be the prevailing rate at the time of payment. As previously discussed, the court cannot turn a
blind eye to BOCs ineptitude and gross negligence in the safekeeping of respondents goods. We are not
likewise unaware of its lackadaisical attitude in failing to prove a cogent explanation on goods
disappearance, considering that they are in its custody and that they were in fact the subject of litigation.
The situation does not allow us to reject respondents claim on the mere invocation of the doctrine of state
immunity. Succinctly, the doctrine must be fairly observed and the state should not avail itself of this
prerogative to take advantage of parties that may have legitimate claims against it.
Commissioner of Customs vs. Marina Sales, Inc.
GR No. 183868. November 22, 2010
Mendoza, J.:

FACTS: Respondent Marina Sales, Inc. is engaged in the manufacture of Sunquick juice concentrates. It
was appointed by CO-RO Food A/S of Denmark, makers of Sunquick Juice Concentrates, to be its
manufacturing arm in the Philippines. As such, Marina usually imports raw materials into the country for
that purposes. In the past, Bureau of Customs assessed said type of importations with 1% import duty
rate. On March 6, 2003, Marinas importations contested its classification. The BOC recommended to the
Collector of Customs, acting as chairman of the Valuation and Classification Review Committee (VCRC)
of the BOC to reclassify Marinas importation to those 7% import duty rate. VCRC directed Marina to
appear in deliberation and explain why its shipment should not be reclassified. As a result, VCRC
reclassified it. Marina appealed to the Commissioner but the latter affirmed the reclassification. On CTA,
the court ruled in favor of Marina. Commissioner elevated the case to CTA en banc but was dismissed for
failure of the commissioner to file a motion for reconsideration first to CTA division before to the CTA en
banc. Hence, this petition.

ISSUE: Whether or not the reclassification was proper
Whether or not the filing of motion for reconsideration mandatory before filing to CTA en banc.

HELD: The court ruled in favor for Marina

RATIO: Rule 8, section 1 of the Revised Ruled of CTA requires that petition for review of the decision or
resolution of CTA in division MUST be preceded by filing of a timely motion for reconsideration or new
trial with the division. The word must clearly dictates mandatory and not merely directory in nature.

To fit into the category listed under the Tariff Harmonized System calling for higher import duty of
7%, the imported articles must not lose its original character. Marinas importations, however, are highly
concentrated and must be mixed with other additives before it can be fit for market consumption. Hence,
must lose its original character.



08 Morales vs CIR
FACTS: Respondent issued a new assessment as deficiency estate and inheritance taxes. Petitioner
then protested claiming that under Internal Revenue Code reassessment of the taxes had already
prescribed, because more than five years had elapsed since the submission of the deed of extrajudicial
partition on which the original assessments were based.
Such claim was rejected by the respondent on December 28, 1956 and the petitioner was serve a
reminder reiterating the demand with a warning that summary remedies will be resorted to after five days.
When respondent served on petitioner a warrant of distraint and levy, with the corresponding notices of
seizure and sale, petitioner requested the cancellation of the warrant of distraint and levy, but respondent
denied the request.
ISSUE: WON the petitioner can question the warrant of distraint and levvy, which resulted from a
reassessment that became final, in the Court of Tax Appeals.
Ruling: The Supreme Court ruled in the Negative.
since petitioner insists that he is not appealing from the decision of December 28, 1956, the same has
become final and unappealable and the matter resolved therein, that is, whether or not the deficiency
assessments against him were barred by prescription, could no longer be reopened through the
expedient of an appeal from the denial of petitioner's request for cancellation of the warrant of distraint
and levy.
09 Tuazon vs CIR
FACTS: Petitioner, a duly organized domestic corporation is the owner of the "LA ROSARIO" distillery
was served an assessment for specific tax on December 15, 1958 by the CIR. In reply thereto petitioner
informed said respondent that the stock had already oxidized and was unfit for human consumption, and
asked for authority to destroy it in the presence of and under the supervision of a government
representative.
Ultimately, respondent denied petitioner's request for authority to destroy the stock, but in his letter of July
3, 1959 respondent reduced the original assessment to P2,814.95, plus P300.00 as a penalty, copy of
which amended assessment was received by petitioner on August 12, 1959. The petitioner reiterated its
request for destruction.
The respondent Commissioner of Internal Revenue, instead of replying to this last request, served on
petitioner on January 20, 1960 a warrant of distraint and levy for P3,525.40, (the original assessment)
plus P300.00 as a penalty, and the latter, in turn, on January 23, 1960 tendered to the former all the stock
of grain alcohol and compounded liquors in question in payment of the specific tax and penalty demanded
provided that the warrant of distraint and levy be withdrawn and a full release and discharge be issued to
it. Respondent never replied to this offer.
On February 11, 1960, petitioner filed its petition for review with the CTA. CTA dismissed the petition for
review on the ground that the same was not filed on time.
ISSUE: WON the petition was filed on time.
RULING: The Supreme Court ruled in the negative.
It is clear from the above facts that the letter of respondent dated July 3, 1959 was, in legal
contemplation, the ruling or decision from which petitioner should have appealed to the Court of Tax
Appeals; that from August 12, 1959 when petitioner received said letter to the 15th of the same
month and year the date when petitioner, by way of a motion for reconsideration, reiterated its written
request for authority to destroy the distilled spirits and compounded liquors in its possession petitioner
consumed three (3) days of the period of appeal, that from October 15, 1959 the date when petitioner
received respondent's letter of September 30, 1959 denying his second request for authority to destroy
the merchandise taxed to February 11, 1960 when the petition for review was filed, more than three
months elapsed.
We believe that petitioner's last written request for authority to destroy the distilled spirits and
compounded liquors in question did not suspend the running of said period, because it was a mere
reiteration of two previous petitions already denied by respondent. Consequently, the conclusion is
inevitable that when petitioner filed its petition for review with the Court of Tax Appeals, the questioned
assessment had already become final, executory and incontrovertible.


10 Roman Catholic vs CIR
FACTS: On the theory that the gross incomes in 1955 and 1956 were realized independently of the use of
the buildings, furniture and fixtures, respondent totally disallowed the deductions for depreciation, thereby
determining against petitioner, on July 15, 1956 and March 30, 1957, income tax liabilities for 1955 and
1956 in the respective amounts of P1,825.00 and P2,493.00 On May 10 and 14, 1957, petitioner
requested for the reconsideration of the determinations which requests were denied by respondent in a
letter dated July 18, 1957, wherein he demanded the payment of above mentioned amount. On August
28, 1957, petitioner requested for the reconsideration of the denial and the cancellation of the
assessments On November 5, 1957, respondent denied this request for reconsideration and demanded
the payment of P4,318.00, plus delinquency penalties incident to late payment. Again on November 23,
1957, petitioner requested for the reconsideration and cancellation of the assessments which request was
denied on January 20, 1958.
On December 4, 1957, respondent issued a warrant of distraint and levy against the properties of the
Roman Catholic.
On February 7, 1958, petitioner paid under protest the total amount. He then filed a petition for review in
the CTA but was dismissed for having filed out of time.
ISSUE: WON the petition should be dismissed.
RULING: The Supreme Court ruled in the affirmative.
We find the dismissal of petitioner's appeal to be substantially correct, for the reason that said appeal was
not taken within the thirty (30) day period. The petitioner has submitted not less than three (3) motions of
requests for the reconsideration of his Tax Assessments. All motions for reconsideration were premised
on the same grounds, deduction of the depreciation of the buildings in question. The appeal to the Tax
Court was filed only on February 19, 1958.
By these successive motions for reconsideration, the petitioner managed to delay the review of his case
by the Tax Court for nearly two years. Such delays are plainly inimical to the general interest,
ascertainment and collection of taxes being essential to the maintenance of the State. The decision by
the CIR dated November 5, 1957, denying the second request for reconsideration of the assessment,
was certainly reviewable by the CTA. Hence, the 30-day appeal period should be counted from
November 21, 1957, when the taxpayer received copy of the Collector's ruling. The running of the period
was not interrupted by the filing of the third request for reconsideration, because the latter did not
advance new grounds not previously alleged, and was, therefore, merely pro forma.
11 CIR vs Union Shipping
FACTS: Petioner CIR assessed against Yee Fong Hong, Ltd. and/or herein private respondent Union
Shipping Corporation, the total sum of P583,155.22 as deficiency income taxes due for the years 1971
and 1972. Private respondent protested the assessment.
Petitioner, without ruling on the protest, issued a Warrant of Distraint and Levy which was served on
private respondent's counsel on November 25, 1976.
Private respondent reiterated its request for reinvestigation of the assessment and for the reconsideration
of the summary collection thru the Warrant of Distraint and Levy.
Petitioner, again, without acting on the request, filed a collection suit before CFI of Manila against private
respondent.
On January 10, 1979, private respondent filed with respondent court its Petition for Review in the CTA of
the petitioner's assessment of its deficiency income taxes, wherein it prays that after hearing, judgment
be rendered holding that it is not liable for the payment of the income tax herein involved, or which may
be due from foreign ship owner.
ISSUE: WON the Court of Tax Appeals has jurisdiction over this case.
Ruling: The Supreme Court ruled in the affirmative.
The main thrust of this petition is that the issuance of a warrant of distraint and levy is proof of the finality
of an assessment because it is the most drastic action of all media of enforcing the collection of tax, and
is tantamount to an outright denial of a motion for reconsideration of an assessment. Among others,
petitioner contends that the warrant of distraint and levy was issued after Respondent Corporation filed a
request for reconsideration of subject assessment, thus constituting petitioner's final decision in the
disputed assessments.
Petitioner argues therefore that the period to appeal to the Court of Tax Appeals commenced to run from
receipt of said warrant on November 25, 1976, so that on January 10, 1979 when respondent corporation
sought redress from the Tax Court, petitioner's decision has long become final and executory.
On this issue, this Court had already laid down the dictum that the CIR should always indicate to the
taxpayer in clear and unequivocal language what constitutes his final determination of the disputed
assessment.
There appears to be no dispute that petitioner did not rule on private respondent's motion for
reconsideration but contrary to the above ruling of this Court, left private respondent in the dark as to
which action of the Commissioner is the decision appealable to the Court of Tax Appeals. Had he
categorically stated that he denies private respondent's motion for reconsideration and that his action
constitutes his final determination on the disputed assessment, private respondent without needless
difficulty would have been able to determine when his right to appeal accrues and the resulting confusion
would have been avoided.
Under the circumstances, the CIR, not having clearly signified his final action on the disputed
assessment, legally the period to appeal has not commenced to run. Thus, it was only when private
respondent received the summons on the civil suit for collection of deficiency income on December 28,
1978 that the period to appeal commenced to run.
12 Yabes vs Flojo
FACTS: Yabes who was for sometime an exclusive dealer of products of the International Harvester
Macleod, Inc., received on or about May 1, 1962, a letter from the CIR, demanding payment of the
amount of P15,976.81, as commercial broker's fixed and percentage taxes plus surcharges and the sum
of P2,530 as compromise penalty allegedly due from Yabes for the years 1956-1960.
On May 11, 1962, Yabes, through his counsel, filed with the CIR a protest against the assessment.
To give time for the CIR to study the case and several other cases similar thereto Yabes filed a tax waiver
on October 20, 1962, extending the period of prescription to December 31, 1967.
On March 14, 1966, the CTA ruled that agreements entered into by Constantino with the International
Harvester were of purchase and sale, and not of agency, hence no commercial broker's fixed and
percentage fees could be collected from the said taxpayer; however this Court reversed the CTA and
ruled in favor of the CIR.
After a lapse of about five years, the heirs of the deceased Yabes, received on August 4, 1967, a letter
from the CIR requesting that they "waive anew the Statute of Limitations" and further confirming the
previous understanding that the final resolution of the protest of the deceased Yabes was "being held in
abeyance until the Supreme Court renders its decision on a similar case involving the same factual and
legal issues brought to it on appeal" (referring to the Constantino "test" case) conformably with the
request of the CIR, the heirs of Yabes filed a revised waiver further extending the period of prescription to
December 31, 1970.
Thereafter, no word was received by the petitioners or their lawyers during the interim of more than 3
years, but on January 20, 1971, petitioners as heirs of the deceased Yabes received the summons and a
copy of the complaint filed by the Commissioner on December 4, 1970 with the CFI which seeks to collect
from the petitioners the sum of P 15,976.82, as deficiency commercial broker's fixed and percentage
taxes.
Taking the complaint as the final decision of the CIR on the disputed assessment against the deceased
Yabes, petitioners filed on February 12, 1971, a petition for review of said disputed assessment with the
Court of Tax Appeals. Later on the same day petitioners filed their answer to the complaint and alleged
therein, by way of special defense, that the CTA has exclusive jurisdiction of the action and that there is
another action of the same nature between the parties relating to the same assessment pending before
the CTA.
ISSUE: WON the assessment made by the CIR against the deceased taxpayer Doroteo Yabes, as
contained has become final, executory and incontestable.
Ruling: The CFI can only acquire jurisdiction over this case filed against the heirs of the taxpayer if the
assessment made by the CIR had become final and incontestable. If the contrary is established, as this
Court holds it to be, considering the aforementioned conclusion of the CTA on the finality and
incontestability of the assessment made by the CIR is correct, then the CTA has exclusive jurisdiction
over this case. Petitioners received the summons January 20, 1971, and petitioners filed their appeal with
the CTA on February 12, 1971, well within the thirty-day prescriptive period. The Court of Tax Appeals
has exclusive appellate jurisdiction to review on appeal any decision of the CIR in cases involving
disputed assessments and other matters arising under the NIRC.
13 CIR vs Concepcion
FACTS: Respondent Jose Concepcion, as ancillary administrator of the estate of Mary H. Mitchell-
Roberts, and respondent Jack F. Mitchell-Roberts, husband of the deceased sought a refund of the sum
of P1, 181.33 and P2, 616.10 representing estate and inheritance taxes on 50 shares of stock of Edward
J. Nell Company issued in the names of both spouses "as joint tenants with full rights of survivorship and
not as tenants in common." The above assessment was made by CIR on the ground that there was a
transmission to the husband of one-half share thereof upon the death of the wife, the above shares being
conjugal property.
Not being agreeable to the theory entertained by CIR, respondents appealed such a decision under RA
1125. The CTA, however, dismissed such an appeal as the petition for review because it was filed
beyond the reglementary period of 30 days. Such decision became final.
What next transpired was this, petitioners paid the taxes in question under protest and at the same time
filed a claim for the refund of said amounts.
ISSUE: WON a taxpayer who had lost his right to dispute the validity of an assessment, the period for
appealing to the CTA having expired and who thereafter paid under protest could then, sue for recovery
on the ground of its illegality.
RULING: The Supreme Court rule in the negative.
In the same way then that the expedient of an appeal from a denial of a tax request for cancellation of
warrant of distraint and levy cannot be utilized for the purpose of testing the legality of an assessment,
which had become conclusive and binding on the taxpayer, there being no appeal, the procedure set forth
for refund is not available to revive the right to contest the validity of an assessment once the same had
been irretrievably lost not only by the failure to appeal but likewise by the lapse of the reglementary period
within which to appeal could have been taken. Clearly then, the liability of respondent Concepcion as an
ancillary administrator of the estate of the deceased wife and of respondent Mitchell-Roberts as the
husband for the amount of inheritance tax was beyond question. Having paid the same, respondents are
clearly devoid of any legal right to sue for recovery.


17. NPC vs Presiding Judge of RTC Branch 25, CDO
Facts: The Province of Misamis Oriental filed a complaint with the RTC of Cagayan de Oro City against
NAPOCOR for the collection of real property tax and special education fund tax covering the period 1978
to 1984. Petitioner NAPOCOR therein, filed a motion to dismiss on the grounds that the court has no
jurisdiction over the action or suit and that it is not the proper forum for the adjudication of the case. In
support of this motion NAPOCOR cited PD 242 which provides that disputes between agencies of the
government including government-owned or controlled corporations shall be administratively settled or
adjudicated by the Secretary of Justice. On July 23, 1985, Municipality of Jasaan, filed a complaint in
intervention contending that non-payment by NAPOCOR of real property taxes would adversely affect its
interest since under the law, (10%) of the real property tax collected on properties within its jurisdiction
shall accrue to the general fund of the barangay.
Issue: Whether or not PD 242 or the Real Property tax code (PD 464) shall be applicable.
Held: The SC held that Real Property Tax Code that shall be applied. An examination of these two
decrees shows that P.D. 242 is a general law which deals with administrative settlement or adjudication
of disputes, claims and controversies between or among government offices, agencies and
instrumentalities, including government-owned or controlled corporations. The coverage is broad and
sweeping, encompassing all disputes, claims and controversies. P.D. 464 on the other hand, governs the
appraisal and assessment of real property for purposes of taxation by provinces, cities and municipalities,
as well as the levy, collection and administration of real property tax. It is a special law which deals
specifically with real property taxes. It is a basic tenet in statutory construction that between a general law
and a special law, the special law prevails. GENERALIA SPECIALIBUS NON DEROGANT. Therefore,
respondent court has jurisdiction to hear and decide case before us.
18. REYES VS. ALMANZOR
Facts: Petitioner are owners of parcels of land leased to tenants. RA 6359 was enacted prohibiting for
one year an increase in monthly rentals of dwelling units and said Act also disallowed ejectment of
lessees upon the expiration of the usual period of lease. City assessor of Manila assessed the value of
petitioners property based on the schedule of market values duly reviewed by the Secretary of Finance.
The revision entailed an increase to the tax rates and petitioners averred that the reassessment imposed
upon them greatly exceeded the annual income derived from their properties.
Issue: Whether or not income approach is the method to be used in the tax assessment and not the
comparable sales approach.
Held: By no stretch of the imagination can the market value of properties covered by PD 20 be equated
with the market value of properties not so covered. In the case at bar, not even factors determinant of the
assessed value of subject properties under the comparable sales approach were presented by
respondent namely:
1. That the sale must represent a bonafide arms length transaction between a willing seller and a willing
buyer
2. The property must be comparable property.
As a general rule, there were no takers so that there can be no reasonable basis for the conclusion that
these properties are comparable.
Taxes are lifeblood of government, however, such collection should be made in accordance with the law
and therefore necessary to reconcile conflicting interests of the authorities so that the real purpose of
taxation, promotion of the welfare of common good can be achieved.
19. Pecson vs CA 222 SCRA 580

Facts: Pecson filed complaint to annul sale at a public auction of petitioners property for non-payment of
real estate taxes, alleging that the sale was made without prior notice to him. The sale, was made without
proper notice to him. He further alleged that he was not notified of his right to redeem the property.

Issue: Validity of public auction of his property for non-payment of taxes on the ground that the notices to
him were sent to the wrong postal address.

Held: The sale was valid. Notices were sent to 79 Paquita St. Manila. Final Notice to exercise right of
redemption also sent to the same address. He admits he no longer reside in Manila and presently resides
in QC but his contention is that the notices should have been sent to 1009 Paquita and not to 79. If the
notices were sent to 1009 Paquita, the new owners of the house would send him the letters as they
always have. The SC ruled that, as property owner and school teacher at that time, he shouldve know
that if an owner fails to pay the real estate taxes on a property, the said property shall be sold at public
auction to recover the delinquent taxes. In the records of the Office of the City Treasurer of QC, below
1009 was the number 79. One can deduce that he taxpayer had transferred his residence to 79. Worse,
petitioner introduced improvements without reporting the same for tax purposes. Issue on the compliance
with the posting of the notices and announcement of the sale, is a question of fact, which this Court will
not inquire into and review the evidence relied upon the lower courts to support their finding.

21. Patalinghug vs CA
Facts:The Sangguniang Panlungsod of Davao City enacted Ordinance No. 363, Sec.8 of which states:A
C-2 District shall be dominantly for commercial and compatible industrial uses as provided hereunder:
Funeral Parlors/Memorial Homes with adequate off street parking space and provided that they shall be
established not less than 50 meters from any residential structures, churches and other institutional
buildings. Petitioner constructed a funeral parlor. Acting on the complaint of several residents that the
construction of petitioners funeral parlor violated Ordinance No. 363 since it was allegedly situated within
a 50-meter radius from the Iglesia ni Kristo chapel and several residential structures, the Sangguniang
Panlungsod conducted an investigation and found that the nearest residential structure, owned by
Wilfred Tepoot, is only 8 inches to the south. Notwithstanding the findings of the Sangguniang
Panlungsod, petitioner continued with the construction of his funeral parlor until it was finished on
November 3, 1987.
Issues: Whether petitioners operation of a funeral home constitutes permissible use within a particular
district or zone in Davao City?
Held: Petitioner did not violate Sec.8 of Davao City Ordinance No. 363. The question of whether Mr.
Tepoots building is residential or not is a factual determination which we should not disturb. A property
may well be declared by its owner as residential for real estate taxation purposes but it may well be within
a commercial zone. A discrepancy may thus exist in the determination of the nature of property for real
estate taxation purposes vis--vis the determination of a property for zoning purposes. A piece of land
declared by a taxpayer as residential may be assessed by the provincial/city assessor as commercial
because its actual use is commercial. Even if Tepoots building was declared for taxation purposes as
residential, once a local government has reclassified an area as commercial, that determination for
zoning purposes must prevail. While the commercial character of the questioned vicinity has been
declared through ordinance, private respondents have failed to present convincing arguments to
substantiate their claim that Cabaguio Avenue, where the funeral parlor was constructed, was still a
residential zone. Unquestionably, the operation of a funeral parlor constitutes as commercial purposes
as gleaned from Ordinance No. 363.
22. Raul Sesbreno vs. CBAA
FACTS: Sesbreno bought real property to which it constructed a residential property. He duly registered
the same for taxation purposes and declared therein he owned a residential house made of strong
materials. However, the field inspectors found otherwisewhat he constructed was a 5storey building
made of materials. As such, they increased by 1000% the assessment made on the property, to which
petitioner naturally contested.
Issue: Whether or not the acquisition cost is the sole basis of the current and fair market value of the
property according to section 5 of PD 464.
HELD: The Supreme Court ruled in the negative. The cited provision merely defines "market value." It
does not in any way direct that the market value as defined therein should be used as basis in
determining the value of a property for purposes of real property taxation. On the other hand, Section 5 of
PD 464 provides unequivocally that "(a)ll real property, whether taxable or exempt, shall be appraised at
the current and fair market value prevailing in the locality where the property is situated." Contrary to
petitioner's contention, acquisition cost cannot be and is not the sole basis of the current and fair market
value of a property. The current value of like properties and their actual or potential uses, among others,
are also considered.