'' TT:I.J' £LL.K: Olp 'H: 1-Liul'F'<L''' ~Ou T 0' Tax App£Au Q:Uao C:J Nr Developme Nt Bank of the Philippine ~:, et al. vs. The Commissioner of Customs

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~OU T 0' TAX APP£AU

Q:uao

C:J nr

DEVELOPME NT BANK OF THE

PHILIPPINE ~:;.

Petit:ioner,

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versus -

C.T.A. CASE NO. 4045

THE COMMISSIONER OF CUSTOMS,

Respondent.

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D E C I S I 0 N

f131 /g7

The case be fore Us prese nts no dispu te as to

the relatively simple material · facts but the parties

seem trying to get t he better of each oth~ r over by

a quibble as tJ the proper import of Section 4(c ) ,

Executive Order No. 1078, dated January 10 , 1986,

1hich provides :

"The amount of taxes due on the

income of the Bank beginning with CY

1985 as well as such ot her taxes,

duties,fees , assessments , charges

and other imposts due on all trans-

action s or operations of the Bank)

is hereby appropriated under this

Executive Order to be

automatic ~ Jly

applied to the payment of the sub-

scription of the Government in the

capital stock is fully paid for. 0

Petitioner governmental financial institu t io n

c~eated and operat e d pursuant to R.A. No. 85, as

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DECI SION -

CTA CASE NO. 4045

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amended, imported from the United States for its

ow n use various IBM computer equipm e nt sometime

durin9 t he period from May, 1985 to January, 1986 .

The total amou nt of E5, 562 , 926.00 r e present ing the

correspondi ng customs duties , compensating taxes

and import process ing fees was accordingl y paid to

the Bureau of Customs.

Pursuant to the pro vjsio n

of Section 4, su pr.§_, petitioner r equested the refund

of s uch paym e nts on Febr ua ry 4, 1 986 but whi c h res-

pondent denied in a l etter to petitioner on March 4,

19 86 .

Hence, t hi s petition f or review.

The respondent Comm i ss ioner o f Customs poses

the jurisdictional iss ue by averring t ha t " all d:s-

putes, cla ims and co ntro versies solely between or

among the departments, bureaus , offices, agen ci es

and instr umentalit i es of the National Go vernmen t ,

including governme nt-ow ned or controlled co rp orations

but excluding constitutional offi ces o6 ag encies,

aris i ng fr om interp r etation an d

Ap pli~atio n of sta tutes~

contracts or ag re 8ments

s ha ll hencefor th be a dmi-

nistrativ ely settled o r a djurl icated" b y the Secretary

o f Jus tice.

(Section 1, PD 242 .)

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450

DEf:ISIO

CTA CASE NO. 4045

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Furthermore, SecU.on 3(e) o f R.A . !35 (not R.A

25 as menti o ned by resporJent) as

nmcn~cd, has

specif:i.c refere nce · nly to the

~.w ount.]f tn xes on

the Bank's incpme and such o'her taxes due on ol l

ot her transact ions necessary or ir c:identnl to peti-

tioner's banking bu~;iness.

·rhe act of import-ation

is certainl y not necessary no r incidental to pet i-

tion er ' s banking business.

And, the lone and ex pr ss

m n t i o n o f

t. he t. e r m " t. a x e s " i n t h e 1 a w 'vJ i t h o u t

s i rn i l a r

and expre ss rnenl:ion of the phr ase "c Ls t orns duties nnd

f ees" indubitab l y means the exc lu sion of the latter

from the co vera ge of the law, reading -

11 Se ction =~(e)

.

Th e nmou nt. of taxe:~

du e to the National , o-..: er nm ent o n income

begin nin g with the calendar yea r 1978 as

well ss taxes due on all ot her transac t ions

of th e Ba nk-be'9"Inrlinq with lh e c al endar

year 1905 is hereby appropriated under

this Dec ree t o be aut omatica l l y applie d

to th e payment o f the s ub sc ribed co pital

s tock of the go ve rnment in the Bank .'

As to Section 4 o f Executive Order 1078 , dated Januar y 10 ,

1986, which was pe titi oner ' s

b~s1s for the ap p lication

o f its ref un d r eq ue s t , the same i s only a mere execuljve

or de r as again s t R.A. 25 (sic) as amended by P.D. 1980,

the law in po int and which should prev~il

.

We do not r each the s ame conclusion as the res-

p o n de n t C o m m l s s i o n e r

·:J f C us t o :~1 s •

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