Tax II final case digests

8/19/2019 Tax II final case digests

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COMM. OF CUSTOMS vs. MANILA STARFERRY

G.R. No. L-31776-78 October 1! 1""3

FACTS#

Manila Star Ferry - owner and operatorof t$%bo&t Orestes

• United Navigation & TransportCorporation - owner and operator of b&r%e'(%)ter UN-L-1*6

• Ceaba Shipping Agency - owner andoperator of an ocean-going vessel S+SAr%o

The patrol boat of Philippines Navy caght thecrew of the S!S Argo in the act of nloadingforeign-"ade goods onto the UN-#-$%' whichwas towed by the tgboat (restes andescorted by two wooden bancas of n)nownownership' in Manila *ay+

The foreign-"ade goods were not "anifestedand declared by the vessel for discharge inManila+

Said vessels and watercraft were charged withs"ggling and declared by the Collector of Csto"s as forfeited in favor of the Philippinegovern"ent by virte of Section ,.% /a0 and/c0 of the Tari1 and Csto"s Code+

(n appeal' the Cort of Ta2 Appeals "odi3edthe decision and ordered pay"ent of 3ne

instead of forfeitre of the vessels andwatercraft+

4ence' this appeal+

ISSUE#

,)et)er or ot t)e s$bect vesse's &/0&tercr&t 0ere e%&%e/ ( s2$%%'(%&/ s)o$'/ be ore(te/ ( &vor o t)e%over2et $/er Sect(o 3* 4&5 &/4c5 o t)e T&r( &/ C$sto2s Co/e.

RULING#

Sec+ ,.%+Property Sb5ect to ForfeitreUnder Tari1 and Csto"s #aws+ 6 Any vesselor aircraft' cargo' articles and other ob5ectsshall' nder the following conditions' besb5ect to forfeitre7

a+ Any vessel or aircraft' incldingcargo' which shall be sed lawfllyin the i"portation or e2portation of articles into or fro" any Philippineport or place ecet & ort o

etr98 and any vessel which' beingof less than thirty tons capacityshall be sed in the i"portation of articles into any Philippine port orplace e2cept into a port of the Slsea where i"portation in schvessel "ay be athori9ed by theCo""issioner' with the approval of the depart"ent head+

2222 2222 2222

c+ Any vessel or aircraft into whichshall be transferred cargo nladencontrary to law r(or to t)e&rr(v&' o t)e (2ort(% vesse'or &(rcr&t &t )er ort o /est(&t(o.

The penalty of forfeitre is i"posed on anyvessel' engaged in s"ggling if the conditionsen"erated in Section ,.% /a0 areco"present+

These conditions are:

(1) The vessel is "used unlawfully in theimportation or exportation of articles into or from" the Philippines;

(2) The articles are imported or exported into

or from "any Philippine port or place, except a port of entry;" or

() !f the vessel has a capacity of less than tons and is "used in the importation of articlesinto any Philippine Port or place other than a

port of the #ulu #ea, where importation insuch vessel may $e authori%ed $y the&ommissioner, with the approval of thedepartment head'"

There is no :estion that the vessel S!S Argowas apprehended while nloading goods of

foreign origin onto the barge UN-#-$% andthe tgboat (restes' withot the necessarypapers showing that the goods were enteredlawflly thogh a port of entry and that ta2esand dties on said goods had been paid+

4owever' while the S!S Argo was caghtnloading s"ggled goods in Manila *ay' thesaid vessel and the goods cannot be forfeitedin favor of the govern"ent becase the Portof Manila is a port of entry+

The Co""issioner of Csto"s arges that the

phrase ;e2cept a port of entry; shold "ean;e2cept a port of destination'; and inas"chas there is no showing that the Port of Manilawas the port of destination of the S!S Argo' itsforfeitre was in order+

Sect(o 3*4&5 ( $2(st&:&b'e ter2srov(/es t)&t & vesse' e%&%e/ (s2$%%'(% ;( & ort o etr9; c&ot beore(te/. This is the clear and plain "eaningof the law+


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enters or departs fro" a port of entrywithot sb"itting the proper"anifest to the csto"s athorities'or shall enter or depart conveyingn"anifested cargo other than asstated in the ne2t preceding sectionhereof' sch vessel or aircraft shall

be 3ned in a s" not e2ceeding tenthosand pesos+

The barge-lighter UN-#-$% and the tgboat(restes' on the other hand' are sb5ect toforfeitre nder paragraph /c0 of Section ,.%of the Tari1 and Csto"s Code+ The barge-lighter and tgboat fall nder the ter";vessel; which incldes every sort of boat'craft or other arti3cial contrivance sed' orcapable of being sed' as a "eans of transportation on water

Said section ,.% /c0 prescribes the forfeitreof> any vessel or aircraft into which shall betransferred cargo nladen contrary to lawbefore the arrival of the vessel or aircraft ather port of destination+ Manila was not theport of destination' "ch less a port of call of the S!S Argo' the i"porting vessel+ The S!SArgo left 4ong)ong and was bond for ?esselton' North *orneo' @5a)arta andSraba5a' INES vs. ?UREAU OF

CUSTOMS G.R. No. 1787" A$%$st 11!

**8

FACTS#

Chevron Phils+ ORT ENTRY @ECLARATIONS 4IE@S0 were 3led and %Dof the total csto"s dties were paid+ TheIM>ORT ENTRY AN@ INTERNAL RE=ENUE

@ECLARATIONS 4IEIR@S5 of the ship"entswere thereafter 3led+

The i"portations were appraised at a dtyrate of .D as provided nder =A B$B% and

petitioner paid the i"port dties a"onting toP.$'E'%,$+ Prior to the e1ectivity of =AB$B% on April $' $' the rate of dty oni"ported crde oil was $%D+Three years later'then Finance Secretary received a letterdenoncing the deliberate conceal"ent'"aniplation and sche"e e"ployed bypetitioner in the I2ort&t(o O Cr$/e O('!T)ereb9 Res$'t(% I


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that the .D tari1 rate shold instead beapplied+ Frther"ore it raised the defense of prescription against the assess"ent prsantto Section $%. of the Tari1 and Csto"sCode /TCC0+ Ths' it prayed that theassess"ent for de3ciency csto"s dties becancelled and the notice of de"and be

withdrawn+

The Special


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his i"portation within 3fteen/$0 days' which shall notli)ewise be e2tendible' fro" thedate of posting of the notice toclai" sch i"portation+/G"phasis spplied0

The ter" ;entry; in csto"s law has a triple"eaning+


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redced by the total a"ont of dties paida"onting to P.$'E'%,$+%% therebyleaving a balance of PB.'B$'B+,$+

*y the very natre of its fnctions' the CTA isa highly speciali9ed cort speci3cally createdfor the prpose of reviewing ta2 and csto"s

cases+ ROTON >ILI>INAS COR>. vs. RE>U?LIC

G.R. No. 16*7 October 1! **6

FACTS#

4erein petitioner Proton Pilipinas Corporation/Proton0 is a corporation dly organi9ed ande2isting nder Philippine laws and dlyregistered with the *oard of


6/23

ASS


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of action' and litis pendentia+ The said Motion'however' was denied by the trial cort in its(rder dated ,E ?anary ,%%.+ Petitionersoght reconsideration of the above-"entioned (rder' bt the sa"e was li)ewisedenied in another (rder dated $ April ,%%.+

ISSUE# ,ON TAI@ CUSTOM @UTIES

AN@ TAE@ ?E SIMULTANEOUSLY

INSTITUTE@ AN@ @ETERMINE@ IN TROCEE@INGS AS T


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Cort shold see) the "eaning and intent of the law fro" the words sed in the statte8and that the i"position of AT on tollwayoperations has been the sb5ect as early as,%%. of several *


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"eander throgh poplated areas and branchot to local roads+ TraJc in the reglar pblichighways is for this reason slow-"oving+


10/23

Co/e! t)e MIAA A(rort L&/s &/

?$('/(%s &re roert(es o $b'(c

/o2((o &/ t)$s o0e/ b9 t)e St&te

or t)e Re$b'(c o t)e >)('((es.

T)e oer&t(o b9 t)e %over2et

o & to''0&9 /oes ot c)&%e t)e

c)&r&cter o t)e ro&/ &s oe or $b'(c$se. So2eoe 2$st &9 or t)e

2&(te&ce o t)e ro&/! e(t)er t)e

$b'(c (/(rect'9 t)ro$%) t)e t&es t)e9

&9 t)e %over2et! or o'9 t)ose

&2o% t)e $b'(c 0)o &ct$&''9 $se t)e

ro&/ t)ro$%) t)e to'' ees t)e9 &9 $o

$s(% t)e ro&/. T)e to''0&9 s9ste2 (s

eve & 2ore ec(et &/ e$(t&b'e

2&er o t&(% t)e $b'(c or t)e

2&(te&ce o $b'(c ro&/s.

T)e c)&r%(% o ees to t)e $b'(c /oes

ot /eter2(e t)e c)&r&cter o t)e

roert9 0)et)er (t (s or $b'(c

/o2((o or ot. Art(c'e * o t)e C(v('

Co/e /ees roert9 o $b'(c /o2((o

&s oe (te/e/ or $b'(c $se. Eve (

t)e %over2et co''ects to'' ees! t)e

ro&/ (s st('' (te/e/ or $b'(c $se (

&9oe c& $se t)e ro&/ $/er t)e s&2e

ter2s &/ co/(t(os &s t)e rest o t)e

$b'(c. T)e c)&r%(% o ees! t)e

'(2(t&t(o o t)e :(/ o ve)(c'es t)&t

c& $se t)e ro&/! t)e see/ restr(ct(os

&/ ot)er co/(t(os or t)e $se o t)e

ro&/ /o ot &ect t)e $b'(c c)&r&cter o

t)e ro&/.

T)e ter2(&' ees MIAA c)&r%es to

&sse%ers! &s 0e'' &s t)e '&/(% ees

MIAA c)&r%es to &(r'(es! cost(t$te t)e

b$': o t)e (co2e t)&t 2&(t&(s t)e

oer&t(os o MIAA.T)e co''ect(o o

s$c) ees /oes ot c)&%e t)e c)&r&ctero MIAA &s & &(rort or $b'(c $se.

S$c) ees &re ote ter2e/ $sers t&.

T)(s 2e&s t&(% t)ose &2o% t)e

$b'(c 0)o &ct$&''9 $se & $b'(c &c('(t9

(ste&/ o t&(% &'' t)e $b'(c (c'$/(%

t)ose 0)o ever $se t)e &rt(c$'&r

$b'(c &c('(t9. A $sers t& (s 2ore

e$(t&b'e & r(c('e o t&&t(o

2&/&te/ ( t)e 1"87 Cost(t$t(o.,.Q /Underscoring spplied0

As can be seen' the discssion inthe -!** case on toll roads and toll fees was"ade' not to establish a rle that tollway feesare sers ta2' bt to "a)e the point thatairport lands and bildings are properties of pblic do"inion and that the collection of ter"inal fees for their se does not "a)ethe" private properties+ Tollway fees are not

ta2es+


11/23

bears its brden since the a"ont of AT paidby the for"er is added to the selling price+(nce shifted' the AT ceases to be a ta2 andsi"ply beco"es part of the cost that thebyer "st pay in order to prchase thegood' property or service+

Conse:ently' AT on tollway operations isnot really a ta2 on the tollway ser' bt on thetollway operator+ Under Section $% of theCode' .$Q AT is i"posed on any person who'in the corse of trade or bsiness' sells orrenders services for a fee+


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$.Q First Asia protested the PAN in a letterdated ?ly ' ,%%,+$EQ

Sbse:ently' the *


13/23

,%%$' the CTA 4n +anc agreed with its First@ivision that the sa"e cannot be given forceand e1ect for failre to co"ply with =MC No+,%-B+

Petitioners Arguents

Petitioner arges that the en"eration of services sb5ect to AT in Section $%B of theN


14/23

or e2change of services sb5ect to AT is note2hastive+ The words' inclding' si"ilarservices' and shall li)ewise inclde' indicatethat the en"eration is by way of e2a"pleonly+

A"ong those inclded in the en"eration is

the lease of "otion pictre 3l"s' 3l"s' tapesand discs+ This' however' is not the sa"e asthe showing or e2hibition of "otion pictresor 3l"s+ As pointed ot by the CTA 4n +anc:

G2hibition in *lac)s #aw @ictionary is de3nedas To show or display+ 2 2 2 To prodceanything in pblic so that it "ay be ta)en intopossession /th ed+' p+ .0+ Ihile the wordlease is de3ned as a contract by which oneowning sch property grants to another the

right to possess' se and en5oy it on speci3edperiod of ti"e in e2change for periodicpay"ent of a stiplated price' referred to asrent /*lac)s #aw @ictionary' th ed+' p+ BB0+

Since the activity of showing "otion pictres'3l"s or "ovies by cine"a! theater operatorsor proprietors is not inclded in theen"eration' it is inc"bent pon the cortto the deter"ine whether sch activity fallsnder the phrase si"ilar services+ The intentof the legislatre "st therefore be

ascertained+

The legislature never intendedoperatorsor proprietors of cinea!theater housesto be covered by "AT

(n (ctober $%' $$' the #OC of $$ waspassed into law+ The local govern"entretained the power to i"pose a"se"ent ta2on proprietors' lessees' or operators of theaters' cine"as' concert halls' circses'

bo2ing stadia' and other places of a"se"entat a rate of not "ore than thirty percent/.%D0 of the gross receipts fro" ad"issionfees nder Section $E% thereof+%Q . vs. CIR

G.R. No. 173 Sete2ber !*1

FACTS#Petitioner was a real estate developer thatboght fro" the national govern"ent a parcelof land that sed to be the Fort *onifacioreservation' now For *onifacio Olobal City+ At

http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn50http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn51http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn51http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn52http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn53http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn53http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn55http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn56http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn60http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn50http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn51http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn52http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn53http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn55http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn56http://sc.judiciary.gov.ph/jurisprudence/2010/february2010/183505.htm#_ftn60


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the ti"e of the said sale there was as yet noAT i"posed so Petitioner did not pay any ATon its prchase+ Sbse:ently' Petitionerstarted selling lots to interested byers+@ring this ti"e' AT was already in e1ect+=eali9ing that its transitional inpt ta2 creditwas not applied in co"pting its otpt ATfor the 3rst :arter of $' petitioner on

Nove"ber $' $B 3led with the *


16/23

CITY OF MANILA vs.


17/23

LASCONA LAN@ Co. Ic. vs. CIR

G.R. No. 1711 M&rc) ! *1

FACTS

• The Co""issioner of


18/23

ANGELES UNI=ERSITY vs. CITY OFANGELES

O+=+ No+ $B ?ne ,' ,%$,

FACTS#

Petitioner Angeles University Fondation/AUF0 is an edcational instittion establishedon May ,' $, and was converted into anon-stoc)' non-pro3t edcation fondationnder the provisions of =epblic Act /=+A+0 No+% on @ece"ber E' $+

So"eti"e in Agst ,%%' petitioner 3ledwith the (Jce of the City *ilding (Jcial an

application for a bilding per"it for theconstrction of an $$-storey bilding of theAngeles University Fondation Medical Centerin its "ain ca"ps located at MacArthr4ighway' Angeles City' Pa"panga+ Said oJceissed a *ilding Per"it Fee Assess"ent+ An(rder of Pay"ent was also issed by the CityPlanning and @evelop"ent (Jce re:iringpetitioner to pay the #ocational ClearanceFee+


19/23

,)et)er et(t(oer (s ee2t ro2 t)e

&92et o b$('/(% er2(t &/ re'&te/

ees (2ose/ $/er t)e N&t(o&'

?$('/(% Co/e.


20/23

S(ce b$('/(% er2(t ees &re ot

c)&r%es o roert9! t)e9 &re ot

(2os(t(os ro2 0)(c) et(t(oer (s

ee2t.

ISSUE # ,)et)er et(t(oers c'&(2 (s

ee2te/ ro2 t)e &92et o re&'

roert9 t& &ssesse/ &%&(st (ts re&'reset'9 occ$(e/ b9 (or2&' sett'ers.


21/23

CITY OF IRIGA vs. CAM SUR III ELECTRICCOO>.

G.R. No. 1"" Sete2ber ! *1

@octrine

The Cort reiterates that a franchise ta2 is ata2 levied on the e2ercise by an entity of therights or privileges granted to it by thegovern"ent+


22/23

that electric cooperatives registered with theNGA nder P@ , which opt not to registerwith the C@A shall not be entitled to thebene3ts and privileges nder the said law+

(n ?anary $' $,' the #OC too) e1ect' andSection $. thereof withdrew ta2 e2e"ptions

or incentives previosly en5oyed by ;allpersons' whether natral or 5ridical' incldinggovern"ent-owned or controlled corporations'e2cept local water districts' cooperatives dlyregistered nder =+A+ No+ .B' non-stoc) andnon-pro3t hospitals and edcationalinstittions+;,VWrXYllVWrXYll

@ 6"! &/ (s(sts t)&t

o'9 et(t(es e%&%e/ ( b$s(ess! &/

ot o-rot et(t(es '(:e (tse'! &re

s$bect to t)e s&(/ r&c)(se t&.

RULING7

N(+ The Cort is not persaded+


23/23

franchise within the territory of the pertinentlocal govern"ent nit+..VWrXYllVWrXYll

There is a con^ence of these re:ire"ents inthe case at bar+ *y virte of P@ ,' NGAgranted CASU=GC(

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Tax II final case digests