Manila Electric Company vs. Fragante

Failure to pay in full the annual registration fees for public-utility trucks on or before July 31, even where the first installment was timely paid, constitutes delinquent registration subject to a 50 percent surcharge under Section 67(a) of Act No. 3992 in relation to Section 8 thereof as amended by Commonwealth Act No. 123.

Manila Electric Company was engaged in public-service land transportation using autocamiones classified for public utility. Vicente Fragante was the Director of the Bureau of Public Works charged with motor vehicle registration. The governing provisions were Section 67(a) of Act No. 3992 imposing a 50 percent surcharge for delinquent registration or renewal, and Section 8 thereof as amended by Commonwealth Act No. 123 on November 3, 1936, fixing annual registration fees for public-utility trucks payable in two equal installments.

Manila Electric Company operated autobuses for public-service land transportation and registered 17 of said vehicles in the Bureau of Public Works on February 25, 1937. For that registration it paid P1,857, representing the fees for the first semester of 1937, which was one-half of the total annual amount due. The remaining P1,857 corresponding to the second semester was not paid within the period fixed by law.

The deadline for complete payment of the 1937 annual fees was July 31, 1937. Because no payment of the balance followed by that date, the Company remained delinquent as to one-half of the annual fees. Thereafter, only on December 2, after having been required to effect payment, did the Company pay the second-semester amount.

The dispute over the additional 50 percent surcharge was submitted to the Court of First Instance of Manila on undisputed facts. That court factually found timely payment of only the first installment, non-payment of the equal second installment by July 31, 1937, and belated payment on December 2 after demand, upon which it sustained the surcharge liability.

• Liability for 50 Percent Surcharge: Petitioner argued that the lower court erred in declaring appellant liable to pay the 50 percent penalty provided in Section 67(a) of Act No. 3992 in relation to Section 8 as amended by Commonwealth Act No. 123, for the reason that the second installment of the 1937 annual motor vehicle registration fees for certain of its public service autobuses was made after July 31, 1937.

• Obligation to Pay 50 Percent Surcharge: Whether appellant is obliged to pay appellee the 50 percent surcharge required by Article 67, paragraph (a), of Act No. 3992 as amended by Commonwealth Act No. 123, where only the first installment of the 1937 annual registration fees for its public-service autobuses was paid before July 31, 1937 and the second installment was paid only on December 2, 1937.

• Obligation to Pay 50 Percent Surcharge: Yes. Appellant was obliged to pay the 50 percent surcharge, its failure to pay the total registration fees on or before July 31, 1937 constituting delinquent registration under Section 67(a) in relation to Section 8 as amended.

• Obligation to Pay 50 Percent Surcharge: Under Section 8 as amended, registration fees for trucks in the public-utility classification were payable in two equal installments, the first on or before the last day of February and the second on or before the last day of July, making full payment by July 31, 1937 the duty of appellant. Payment of only one-half, with the equal balance of P1,857 left unpaid by July 31 and paid only on December 2 after demand, placed appellant in mora and rendered it subject to the penalty prescribed by Section 67(a) on the portion of the year for which the vehicle was registered. Mora in motor vehicle registration was construed to consist not only in late registration itself but also in failure to pay, not partially but totally, the legally required fees within the previously fixed periods. The construction adopted from Judge Vera was that the amendatory law intended to somewhat increase truck registration fees while avoiding hardship by allowing payment in two installments; to relieve a taxpayer of all surcharge upon mere payment of the first installment despite untimely or incomplete payment of the second would deprive the provisions of the effect for which they were approved and leave them without object or purpose, which is manifestly absurd.

• Delinquency by Incomplete Payment of Registration Fees — Delinquency under the Motor Vehicle Law is incurred not only by late registration of an unregistered vehicle or late renewal, but also by failure to pay in full within the statutory periods the fees required for registration or renewal. Applied here, payment of only the first-semester installment by February, without payment of the second-semester installment by July 31, left the registration delinquent and triggered the 50 percent surcharge on the fees corresponding to the unpaid portion of the year.
• Statutory Construction Against Absurdity — A statute must be interpreted to give effect to the purpose for which it was approved and not in a manner that renders it without object or purpose. Applied here, the facility to pay public-utility truck fees in two installments could not be read to exempt from surcharge a taxpayer who failed to pay the second installment on time, as such reading would defeat the purpose of Sections 67(a) and 8 as amended.

• "The lower court erred in declaring that appellant, under the facts of the case, is liable to pay appellee the 50 percent penalty provided for in section 67 (a) of Act No. 3992, in relation to section 8 of the same Act as amended by Commonwealth Act No. 123, for the reason that the second installment of the 1937 annual motor vehicle registration fees corresponding to certain of appellant's public service autobuses was made after July 31, 1937." — States the sole assignment of error framing the issue of surcharge liability for the late second installment.
• "Por la matricula despues del termino de siete dias siguientes a la toma de posesion de un vehiculo de motor no matriculado, o por la renovacion de una matricula morosa, el recorgo sera de cincuenta por ciento sobre los derechos que se mencionan en el articulo ocho de esta Ley, correspondientes a la parte del año para la cual se matricule el vehiculo para su uso.;" — Reproduces the controlling surcharge rule in Section 67(a) of Act No. 3992 applied to delinquent registration and renewal.
• "La mora, en los casos de registro de vehiculos de motor, no consiste solamente en el registro tardio de dichos vehiculos, en la Oficina de Obras Publicas, sino tambien en la falta de pago, no parcial, sino total, de los derechos que por ley hay que pagar por dicho menester o formalidad dentro de los plazos previamente marcados." — Defines the ratio decidendi that mora includes failure to pay the required fees in full within the fixed periods, not merely late physical registration.

• Section 67(a), Act No. 3992 — Imposes a 50 percent surcharge on the fees mentioned in Section 8 for registration after seven days from taking possession of an unregistered motor vehicle or for renewal of a delinquent registration, corresponding to the part of the year for which the vehicle is registered for use; applied to hold appellant liable for the unpaid second-semester fees.
• Section 8, Act No. 3992 as amended by Commonwealth Act No. 123 — Fixes the schedule of annual registration fees and provides that fees for trucks in the public-utility (T.P.U.) classification shall be payable in two equal installments, the first on or before the last day of February and the second on or before the last day of July; applied to establish appellant's duty to have paid the total 1937 fees by July 31, 1937.

Avanceña, Pres., Imperial, Laurel, and Horrilleno, JJ., concurred.