CTA Case No. 213

REPUBLIC OF ‘THE *HILIPPINES

COURT OF 1AX APPEALS

MANILA

COLLECTOR OF INTERNAL —

REVENUE,

Nespendents

Renae se @ we eo ew oe © = ot

DECISLON

Petitioner Censuele *. Berje is the grentee of a legislative franchise (Act Nes 3816, approved on December 6, 1935) te maintain and operate an electric light, heat and power system in the auni- cipality (new city) of Iligan, Prevince of Lanso.

During the years 1953 to 1955, the petitioner imperted frem Japan electrical equipment and ma- terials which she used to connect the distribution system of her electric plant with the Hiaria Cris- tine Hydro-Electric Plant, and to impageve the elec- tric, heat and power service of her establishment. Upen demand by the Collector of Internal Hevenue, the petitioner paid the cewpensating tax en the said inpertatiens in the auount of 94,104.25, and later, in her letter of April 21, 1955, requested fer the refund of the amount ef enly 3,977.62. inasmuch as the respondent did net act upon her request for refund after waiting for alwest seven nenths, petitioner filed with this Court en Novem 43 vf

DECISIGN «

C.T.A- CASE NO. 213 ber 26, 1955, the instant petition fer review te secure the refund of °3,972.62.

Since the claim for refund is enly for the sum of °3,977.62, this Court acquired juxisdiction te exrdex a refund, if the tex in question wes errenesuely or illegaily collected, enly up te the said amount. “het is not covered by « claim for refund duly filed with the Collecter ef inter- nal Kevenue, this Court has no jurisdiction. (Sec. 306, National Internal Revenue Cede). The enly effect of the evidence presented and admitted that the texpayer herein actually paid the sum ef 24,104.25 as compenseting tax is thet this Court esuld grant relief, if legally allowable, for mere than whet is alleged and prayed fer in the complaint, ieee, 3,972.62, (Sec. 9, tule 35, Sules of Court) but certainly not in excess of the axeunt stated in the jurisdictienal claim fer refund previeusly filed with Collector cf Internal Hevenue. Thexefore, it is the ameunt ef °3,977.62 which we shall presently determine te be refundable or not te the petitioner.

The only issue in this case is whether cor not the petitioner, under the previsiene of her legis- lative franchise, Acts Nes. 3810 and 3636, the Model Electric Light and Power Franchise Act, is exexpted from the payment of the eoupensating tax prescribed by Sectien 190 ef the National Internal Kevenve Cede on the electrical equipment and materials wiich she imperted from Japan.

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DECISION «

CeTeAe CASE NO. 213 -~2- The pertinent pertien ef Sectien 190 cf the Tax Cede under which the comensating tex in cues- tion was collected prevides as fellows:

a rn 6 wesiding or yo fo rence _ purchese or receive rem watueut iippines COMnO- dities, qoods, wares, or mee on pa excepting these subject to speciiic taxes wnder Title IV of this Cede, shall en the total value thereof at the tine they ere received by such A+ 3 ine ¢Cluding freiaqnt, pestaye, con. mission, and ali Similar charges, 8 com- Segre tax equivalent to tae iepeted under this Title on original merchandise irom the custemseouse ox tne pest offices x x« = x * And the texpayer's franchise, Act “Ne. 2810, which wes appreved on Mecesber 6, 1930, reade ss follows: "Section 1. Subject to the rules and conditiens estabiisned in Aci umeberea Thirty-six hundred end ome a ag a is granted to Censueio Ser a panne ef fifty years from the ap ~~ of this ae the right, ewe ggg oP ty te construct, meinteain, and my A tric iight, heat and pewer fer the purpese ef wpe ge F and ting electric 7 -% | Aeat and power, for tale within the limits of the y Ga » /Revinte of Lanac, Philippine Islands.

The petitioner contends thet Act Me. 26%6 wee mode a part cf and inrcerrorete? by reference inte her franchise, end undér Section 10 of Seetien 1 of said Act which provides as followss meme: —

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WECISION .

CeTeAe CASE NO. 213 she cleime that she is exeept from paying the per- centage tax in controversy.

| We find petitioner's centention untenable. It is true that her franchise is, by express prevision of its charter, subject te the rules and conditions established by Act Ne. 3636. (Carcar Electric 4 Ice Plant Cee, Inc. vs. Collector of Internal He-~ venue, Gal Noe L~9257, Cet. 17, 1956). However, we are cf the opinion thet under Section 10 of Sec- thon 1 ef Act Nes 3636 which is queted above, the petiticner is net exempt frem paying the compensa- ting tax en its impertations of electrical equip- ment and materials.

, aA 46 . = ne er ee ——

DECISION «

C.T.As CASE M. 213 wo S « The este at bar ia substantially en eil ‘ fours with/ the case cf Panay Mostahe, Sapeny vs. Collector of Intexneal Kevenue (G.%. Noe Le 6753, July ©, 1955). in the seid case, tie tax- payer bought abroad and iuperted into the Pnilip- pines generators with auxilieries and electric switch beards. The “upreme Court, in intexpretins Section 8 ef the taxpeyer's franchise - Act lic. 2983 as amended by Act Ne. 3665 which reads as follewss "Sec. & The written eccentence of this frenchise by the sennine shall be filed witha the Secretary ef Commerce and Communicatiens within ene hundred and twenty days frem the dete ef the apprevs] of s Act, end in considera- tien ef this frenchise end rights here- rs ne the grantee shall By! inte municipal tressury of esch wunici- oe poh e in which it is supplying elec-~ te the publi¢e under this fran- chise, a tax equal te ene and one-half per centum ef the gree eernmings of his electrical business in tne corresponding municipelity during the first twenty yeaze and we ver centum the li the re- thirty youwe of the cant of said » the » squares bridges, anc other sialee ane and. en its franchise, rights, privileges, vessipts, and prerita, held thet the Panay Electric Cempary wes net exempt | frem the payment of the cespensating tax on its ix- |

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47

DECISION «

-~6& «= pertatiens. Note the very close similerity bet- ween the tax exexption provisions in “Section 10 cf Seetion 1 of Act Ne. 3636 which is relied upen by the peti tienex herein, and Section 8 ef Act Ne. 2983 as amended by Act No. 366%, the Panay Slectric Come pany's franchise.

The Supreme Court in denying the claim of the Paney Electric Company (supra) for exemption fren ie Secret "It is cont in the first place, thet the abeve previsien of its cha:

"As to the first contenti it is te peint evt thet ae Pp public ceueee ant public asses tne See reese See oe , all egaelan taese are installed oes & public ox pri- articles vate place is iwnsie stad privileges waict the above nee Sat oe & which the oor une enjeyed

DECISION ~

CeTee CASE NO. 213 eT ag ae ce by by the ‘peti tienes" A. its _- ‘ oto Cenformably te the decision of the Supreme Court in the case cited and quoted ebove, we hold that the petitioner in the case at ber is not exe emt frem paying the cespensating tax in question.

Mereever, with regard te the sum of ®1,258.19 which is a part of the amount ef °3,977.62 claimed by the petitioner te have been erroneously collected by the respondent, we find that the same was paid on November 2, 1953. (Exhibit “M") ‘Since the pre- sent suit fer its refund wee filed with this Court only on November 26, 1955, or more then two years from the date of its payment, we heave ne jurisdic- tion te exder its refund, even if it was illegally collected by the Collecter of internal Revenue, (Seco 26, ational internal Revenue Codes Flera Reberson Ce vs. Collector of Internal Revenue, vy 49 TT ee

DECT SION «

CeleAe CASE NO. 213 Geille NO. L-9352, Mov. 79, 1956; P. Je Kiener Com pany, Ltd. vs. Seturmino David, 49 ©.G. 1962).

iii View OF Tei PORQQGOLNG CONGLOERASIONS, the eleiw for refund of the petitioner fer the sum of ¥3,977.62 should ba, as it is hereby denied, fer jack of merit. ‘ith costs against the retitioner.

30 ORDERED. | Manila, Philippines, February 11, 1997.

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