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Title: Romulo San Juan vs. Ricardo Castro

Facts:

 Petitioner is the registered owner of real properties.

 Petitioner conveyed the same by DOA to SARC in exchange for 258,434 shares of stock
with a total par value of 2.5.m.
 Petitioner went to city treasurer (respondent) to pay the transfer tax based on the
consideration stated in DOA.
 Respondent informed the petitioner that the tax due must be based on the FMV of the
property.
 Petitioner protested. Respondent however reiterated that in the case of transfer of real
property not involving monetary consideration, it is the FMV/Zonal Value of the propert
which is the basis of the tax rate.
 Thereafter, petitioner filed to RTC a Petition for Mandamus and damages against
respondent in his capacity as City Treasurer praying that the respondent be compelled
to perform a ministerial duty and to accept the payment of the transfer tax based on the
actual consideration of the transfer/assignment.
 RTC dismissed the petition and held that mandamus cannot lie to compel the
respondent as City Treasurer to accept as full compliance a tax payment which in his
reasoning and assessment is deficient and incorrect. Hence the present petition.

ISSUE:

Whether or not the taxing power of LGU specifically the power to asses and collect taxes
is discretionary in nature hence mandamus does not lie to compel the City Treasurer to
accept payment which in his reasoning and assessment is deficient and incorrect.

HELD:

The court denied the petition and upheld the respondent RTC’s decision.

The court held that mandamus lies only to compel an officer to perform a ministerial
duty (one which is so clear and specific as to leave no room for the exercise of discretion in
its performance) but not a discretionary function, (one which by its nature requires the
exercise of judgement). Respondent’s argument that mandamus cannot lie to compel the
City Treasurer to accept as full compliance a tax payment which in his reasoning and
assessment is deficient an incorrect is thus persuasive.

The court further held that petitioner should have resorted to Sec.195 of LGC either
appeal the assessment before the court of competent jurisdiction or paid the tax and then
sought a refund, which the petitioner fails to observe.
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FOR CASES NUM 20 AND 25

Title: Yamane vs. BA Lepanto Condominium Corp.

Facts:

Respondent is authorized under Article V of its amended By-Laws to collect

regular assessments from its members for the operation expenses, capital expenditures
on common areas another special assessments as provided for in the Master Deed with
Declaration of Restrictions of the Condominium.
On 1998, the corporation received a notice of assessment in which it is liable to
pay correct city business taxes, fees and charges but respondent with written protest
contended that the assessment has no basis as the corporation is not liable for business
taxes and surcharges and interest thereon under the code or even under the LGC.
Aside from contending that the assessment did not state or is silent as to the statutory
basis of the business tax assessed, the corporation also contends that it was organized
not for the profit but to hold title over the areas of the Condominium, neither was the
corporation authorized under its AOI an
By-Laws to engaged in profit-making activities, and that the assessment it did collect
from the unit owners were for the capital expenditures and operating expenses.
The protest was rejected by petitioner contending that the collection of dues from
the unit owners was affected primarily to sustain and maintain the expenses of the
common areas, with the end view of getting full appreciative living values for the
individual condominium occupants and to command better marketable prices for those
occupants who would in the future sell their respective units. Thus, she concluded, that
since the chances of getting higher prices for well-managed common areas of any
condominium are better and more effective than common condominiums with poor
managed common areas, the corporation activity is profit venture making.
RTC held that the activities of the corporation fell squarely under the definition of
business under Sec.13(b) of LGC and thus subject to local business taxation. CA
reveresd the RTC’s decision and held that the corporation was not liable to pay taxes,
since the corporation is not engaged in profit.

ISSUE:
(as for case num.20)

Whether or not the city of Makati may collect business taxes on condominium
corporations.

(as for the case num.25)

Whether or not the RTC is deciding an appeal taken from the denial of the
protest by a local treasurer under Sec.195 of LGC exercises original jurisdiction or
appellate jurisdiction.
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HELD:
(as for case num.20)
The court, as for the substantive issue held that condominium corporations are
generally exempt from local business taxation under LGC irrespective of any local
ordinance that seeks to declare otherwise.
The court further held that the exercise of the power of taxation constitutes a
deprivation of property under the due process clause, and the taxpayers right to due
process is violated when arbitrary or oppressive method are used in assessing and
collecting taxes. The facts that the corporation did not fall within the enumerated classes
of taxable businesses under either LGC or Makati Revue code already forewarns that a
clear demonstration is essential on the part of petitioner why the corporation should be
taxed away.
From the condominium act, the court also stressed that condominium corporation
is precluded by statute from engaging in corporate activities other that the holding of the
common areas, and other acts necessary, incidental or convenient to the
accomplishment of such purposes. Neither the maintenance of livelihood nor the
procurement of profit fall within the scope of permissible corporate purposes of a
condominium corporation under the Condominium Act. Also, none of the stated
purposes are geared towards maintaining a livelihood or abstention of profit.

(as for case num. 25-Procedural)

The court held that the procedural matter involved in the case at bar was
anchored on the language of section 195 of LGC which states that the remedy of the
taxpayer whose protest is denied by the local treasurer is to appeal with court of
competent jurisdiction, apparently though, the LGC does not elaborate on how such
appeal should be undertaken.
The review taken by the RTC over the denial of the protest by the local treasurer
would fall within the courts original jurisdiction. In short, the review is the initial judicial
cognizance of the matter. Moreover, the court held that, labelling the said review as an
exercise of appellate jurisdiction is inappropriate, since the denial of the protest is not the
judgement or order of a lower court, but, of local government official.
The court finds merit to the respondent’s position that the proper remedy of the
corporation from RTC judgement is an ordinary appeal under Rule 41 to CA. However,
the court in this particular case, held that, the characteristics of all procedural rules is
adherence to the percept that they should not enforced blindly especially if mechanical
application would defeat the higher ends that animates our civil procedure, the just and
speedy and inexpensive disposition of every action and proceeding. The court then used
its discretion to take cognizance of petitions raised on erroneous mode of appeal ( in
this case respondent erroneously elevated its appeal to CA via Rule 42)and instead treat
the present petitions in a manner as they should have been filed. Hence, by employing
the Rule 42 mode of review, the Corporation faced a greater risk of having its petition
rejected by the CA as compared to having filed on ordinary appeal under Rule 41. This
was not an error to the prejudice of the City Treasurer.
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Title: Ericson Telecom. Vs. Pasig City

Facts:

Petitioner corporation was assessed by the respondent on 2000 for business deficiency
tax for years 1998-200. Petitioner filed a protest contending that the local business tax should
be based on gross receipts and not gross revenue. Respondent however denied petitioners
protest and gave the latter 30 days to appeal the denial. This prompted the petitioner to file a
petition for review which was countered by respondent on the grounds that the RTC has no
jurisdiction over the subject matter and that the petitioner has no capacity to sue. RTC cancelled
set aside the assessments made by the respondent and its City. Upon appeal, CA set aside
RTC’s decision.

Respondent contends that the assessed deficiency local business taxes on petitioner
must be based on the latter’s gross revenue, arguing that gross receipts are synonymous with
gross revenue. Petitioner however contends that only the portion of the revenues which were
actually and constructively received should be considered in determining its tax base.

Issue:

Whether or not local business tax based on Pasig City Revenue Code and LGC should
be based on gross receipts and not on gross revenue.

Held:

The court held that respondent committed a palpable erro when it assessed petitioners
local business tax based on its gross revenue as reported in its audited financial statements, as
sec 143 of LGC and Sec 22 (e) of Pasig Revenue clearly provided that the tax should be
computed based on gross receipts.

The court further held that the imposition of local business tax based on petitioners gross
revenue will inevitably result in the constitutionally proscribed double taxation, taxing of the
same person twice by the same jurisdiction for the same thing in as much as petitioners
revenue or income for a taxable year will definitely include its gross receipts already reported
during the previous year and for which local business tax has already been paid.

Title: Angeles City vs. Angeles City Electric Corp.

Facts:

Respondent AEC was granted a legislative franchise under RA 4079. PURSUANT TO

Sec.3-a thereof, AEC’s payment of franchise tax for gross earnings from electric current sold
was in lieu of all taxes, fee, and assessments. On 1992, LGC was passed into law. In 1994,
MACCI filed a petition with Sangguniang Panlungsod, seeking the reduction of the tax rates
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and review of the provisions of Revenue Code od Angelas City. Respondent AEC has been
paying the local franchise tax since 1995. On 2004, city treasurer issued a notice of
assessment to AEC for payment of business tax license fee and other charges, AEC protested
the assessment claiming that it is exempted from paying local tax business pursuant to RA
4079, since it is already paying franchise tax on business, the payment of business tax would
result to double taxation. However petitioner denied the protest, AEC appealed such denial to
RTC. However, on 2004, petitioner levied on real properties of AEC with notice of Auction.. This
prompted the AEC to file with RTC an urgent Motion for Issuance of Temporary Restraining
order with Preliminary Injunction to enjoin petitioner from levying seizing xxxxxx its properties.
RTC issued the same granting the issuance of Writ of Preliminary Injunction. Petitioner filed a
Motion for Recon and Motion for Dissolution of Prerliminary injunction, but was denied by RTC.

Issue:

Whether or not RTC can issue Writ of Preliminary Injunction to enjoin the petitioner from
collecting taxes.

Held:

The court in dismissing the case held that the prohibition on the issuance of writ of
injunction to enjoin the collection of taxes applies only to NIRTaxes and not to local taxes. The
LGC does not specifically prohibit an injunction of taxes. The court does upheld the RTC’s
issuance of writ of injunction.

The court finds no grave abuse of discretion on the part of the RTC in issuing the writ of
injunction. It further held that the two essential requisites of an injunction have been satisfied.
While the damage to the taxpayers property rights generally takes a back seat to the paramount
need of the State for funds to sustain governmental functions, this rule does not find application
in the cae at bar where the disputed tax assessment is not yet due and demandable.

Title: Hon. Franklin Drilon vs. Mayor Alfredo Lim et.al and City of Manila

Facts:

Four oilcompanies and a taxpayer appealed to the petitioner as SOJ to declare the
Rvenue Code Of Manila null and void for non-compliance with the prescribed procedure in
enactment of tax or ordinances and for containing certain provisions contrary to law and public
policy. The RCT however, upon certiorari filed by respondents sustained the ordinance and
evoked SOJ’s resolution declaring sec.187 of LGC as unconstitutional because of its vesture to
SOJ of the power of control over local governments in violation of the policy of local autonomy
mandated in the constitution and of specific provisions therein conferring on president of PH
only the power of supervision over local government. The SOJ argues that the annulled
Sec.187 is constitutional and that the procedural requirements for the enactment of tax
ordinances as specified in LGC had indeed not been observed.
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Issue:

WON sec.187 of LGC is constitutional.

Held:

The court reversed the decision of RTC insofar as it declared Sec.187 unconstitutional
but confirming RTC’s decision on procedural requirements in enactment of Manila Revenue
code have been observed.

The court held that sec187 of LGC authorizes the SOJ to review only constitutionality or
legality of the tax ordinance and if warranted to revoke it. When he alters or modifies or sets
aside tax ordinance, he is not also permitted to substitute his own judgement for the judgement
of the local government that enacted the measure. Petitioner 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 basis for its annulment. He did not say
that his judgement it was a bad law. What he found only was that it was illegal. All he did in
reviewing the said measure was to 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 LGC, as the court see it, it was not an act
of control but mere supervision.

Title: Jardine Davies Insurance Brokers Inc. vs. Hon. Erna Aliposa et.al

Facts:

On 1993, PRCI ( a tax payer) appealed in DOJ fro nullification of Makati Revenue
Code.DOJ declared the same null and void and without legal effects. While Makati’s MR for
DOJ’s decision in RTC is still pending, said Revenue ordinance continued to be implemented.
Petitioner then was assessed for taxes, fees and charges under said ordinance. It paid the
same without any protest. Thereafter in 1994, petitioner wrote the Mun. Treasurer requesting
respondent Makati to compute its business tax in accordance with Manila Revenue Code and
not under the ordinance of Makati since the same was already declared by DOJ null and void,
requesting also for credit over the overpayment it paid. Said request was denied by respondent
Makati.

In the meantime, RTC granted Makati’s petition declaring the said ordinance valid. Upon
learning of the denial by mun. Treasurer, petitioner filed a complaint with RTC against
respondent Makati to declare Makati Revenue Code null and void.

RTC, ruling in favour of respondent held that Sec. 187 and 195 of LGC, the petitioner
failed to file an opposition or protest to the written notice of assessment of Makati for taxes,
fees, charges at rates provided for the ordinance within 60 days from the notice of said
assessment as required by Sec.195 of LGC.

Issue:
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WON petitioners right to file its complaint has already prescribed.

Held:

The court in denying the petitioner’s complaint held that, petitioner failed to appeal to the
SOJ within 30 days from effectivity date of the ordinance as mandated by sec 187 of LGC,
hence, failure of the taxpayer to interpose the requisite appeal to DOJ is fatal to its claim for
refund.

The court further held that, the law requires that the dissatisfied taxpayer who questions
the validity or legality of a tax ordinance must file his appeal to DOJ within 30 days from
affectivity thereof. In case the SOJ decencies the appeal, a period also of 30 days is allowed for
an aggrieved party to go to court. But if the SOJ does not act thereon, after the lapse of 60
days, a party could already proceed to seek relief in court. These three separate periods are
clearly given for compliance as pre requisite before seeking redress in a competent court. Such
statutory periods are set to prevent delays as well as enhance the orderly and speedy
discharge of judicial functions. For this reason the courts construe these provisions of statutes
as mandatory.