CTA Case No. 548

DECISION

The petitioner herein, Conrado Larida, is the owner of a smell moter-powered sugar mill commonly known as “trapiche" located in the Municipality ef Talisay, Province ef Cebu, from which he had been pro- ducing guscoyade suger em a small scale for hinself and fer the neighboring farmers since 1950 up te the pre- sent tine.

Sinee the commencement ef the operation of peti- tioner’s *trapiche® in 1950 up te and including the peried now under review «= April 16, 1956 te Merch 12, 1956 << the respondent Collecter (now Commissioner) of Internal Aevenue, through his duly autherized repre- sentative stationed in the aforesaid aunicipality and provinee, had been assessing against, and collecting from the petitioner, es proprietor and operator ef « Sugar central, © tex ef 2) on the gross value ef the muscevade Sugar manufactured by him allegedly under authority ef Section 189 ef the National Internal Ree venue Code which imposes © tax equivalent to two per centum (26) ef the gress value in aoney ef all the suger 262

DECDS IGN «

GelsAe CASE NO, 548 manufactured by proprietors or operators of sugar cen Seals.

Believing that the “trapiche" belonging to hin is not a suger central within the contemplation of the last cited section of the National Internal Aevenue Gode, the petitioner through counsel, wrote «a letter — (pe 2, BIR rec.) dated April @, 1956 to the sespondent questioning the validity of the assessment and at the Game time demanding the refund of the totel amount of 576.66 which the petitioner hed peid in small suns and at different times to the respendent during the period from April 16, 1956 up te Merch 12, 1958, as percentege tex on the gross value of the suscovado sugar menufoectured by him. These peyments are duly Supported by officials receipts, Exhibits A to A-l4 (pp. 27-41, CTA rec.). | AS will be noted on the rubber @tamp appearing et the upper right hand side of petitioner*s letter of Apeil 6, 1998 (p. 2, BIR rec.), the respondent reo Geived the seme on April 16, 1958.

After waiting for almost three months for the aeply of respondent to petitioner's letter of April &, 3956, which never came up to the present time, and fearing thet the two-year prescriptive pertod within which te file his suit fer refund frow dete of payment, @e fixed in Section 34 ef the National Internal Kevenve Code would run out on him, the petitioner on June 23, 1956, appealed the case to this Court preying that we Gecide the valicity of respondent "s assessment and the tv on) a) bY | ee ee |

DECI IQ) =

ColsAs CASE NO, 848 e 3 merit of his (petitioner's) claim for refund of the amount of #576,.66, a relief cver which he was net asle te obtain ea prompt and cetegorical ruling or decision feem the respondent up te the present tine. There are only two issues raised In this appeals 1, Mey we essume jurisdiction over this case and decide it on the merits netwithstand- ing the fact — the respondent hes never decided the request for refund of petitioner up te the present time. and, therefore, under Section 11 of Republic Act No, ie, there is no formal and final decision to appeal from? and, 2p if the answer te the first query be in the effixmative, 16 the petitioner a pro- prietor end operetor of a ae seek bel within the contemplation ion oi the National internal Aevenue Code, so as to hold him ifable for the percentage tax provided therein?

These two questions are no ionger novel with the recent decisions of ad Supreme Court invelving anelogeus tacts and issues, in our resolution of sugust 22, 1956 In the case of Paracale-Gumaus Consolidated Mining Company ve. otl- verio blaquera, Collector of Internal Nevenue, Geiss Gaee No, 2ll, the majority ef this Court hed eccesiion to cule on a Similar issue as the first one now being raised vefare us, in said resolution, we held that the provision of section 306 of the Netional Internal Revenue Code, insofar as it requires that court actions fee zefund must be instituted within two (2) years from the date of payment, hee net been impliedly sepeaied by Section 11 of Hepubisc Act Ne. 1125 which provides thet euch action mist be instituted within thirty (20) cays 264 Th te A i —— - - • • with claims .for. .refund, stated the following: t 265 '---·--· ...

Gelete CUE NO, 545

Silverio

Internal

Je Kiener Ce, if Revenue,

VSe

» Ltd.

Geollectes of Internai

Revere, Ge As NOs ane L-S165, il venue, Gs Re NOg L307, ihe

or of Internel Kee

July My 1950.)

In the recent case of Collector of Internal Ace venue ve. J, My Swoensy, et ale, G. A. No. L-19178, a we —> 266

CeleAe CAE 1 548

» 6 @ promulgated on August 21, 1959, the Supreme Court held i ae

Beit

i 85328 7 $ oe get ie i Ra “ghee, LnlOt4ey. dane 7088) 0 we a i i fae a ee af ff o™, 267

DECIS IG «©

Gel. A. CASE NO, 349 o J « court within 2 years after the pay- ment of the ~~ bars ino oe the Having thus resolved es we do resolve the first query on jurisdiction in the sefiirmative following welle established precedents, we shell now proceed to dispose of the second issue which goes into the merits of the Case, It has beea satisfactorily estaviished through the uncontradicted testimony of petitioner Conrado Larida that hie sugar mill or “trapiche"™ frem which he hed been producing quscoyado sugar since 1950, censists of two email revolving cylindrical steel reilers artven by motor power in which sugar cane {s inserted end crushed to draw therefrom suger cane juice; thet formerly, the rollers of his "trepiche* were operated by antwel power but new motors are used Insteed; that the "treapiche” whieh he owns and operates produces only muscoyado suyer unlike Sugar Gentrals which produce @ more refined product known as Centrifugal sugar; thet the juice extrected from his “trepiche" is bofled in contatners known as “cewe" and for this purpose dry coconut leaves are used for fuel; thet the thick syrup cbtained by boiling ts set to dry, placed in “hurt” bags end then werketed st retail in the different towns of Cebu; and, that he eperstes his “tra- piche” just to ufll the sugar cane from his three=hectare 268 20?

ad view ds Lue eo CeTeA. CE WO, HS plantation and to acconmodate * limited group of anil plantation owners Ifke him th the neighborhood, whe being their sugar cane to the mill oy hand or ta tzeucks, es t.5.Ne) Obviously, from the description given, petitioner*s suger mill {s net « sugar central within the contemplae tion ef Section 199 of the Neticnal Interne] Aevenue Gode and, therefore, the petitioner {s not lfeble for the payment of the percentage tax [provided therein tellowe ing the decision of the supreme Court tm the analogous ease of Collector of internal Revenue vs. Juan lL. Ledesma, G. Ry No, L-12186, promlyeted on Mey 27, 1959, wherein it was held - "x x x thet e *sugar centrei*, es that term is used In section 169, applies to ta mill that maxes sugar out of the cane beought from a wide surraunding territory,* @e @ Sugars will which menufactures suyar for @ mumber of plantations. The term ‘sugar sentral’® c act have been Intended oy Congress to refer to all sugar mills or @ugar factories as con by respondent, If zrespondent*s interpretation is to be fole {teeptchs oper mills run I animal power we be cons ide 3 SUgar cene We Go not think Congress ever lie tended to plece owners of ‘trapiche® in the Soates® Whellester ef Ixvernel’ Reviewe v6. Juan i. Ledesma, supe.)

Of the total amount of the claim for refund in the sum of #576,.66, the petitioner is entitled to the refund Of only 6499.44 it appearing from the Officiel Kecetpt, Exhibit "A" (p. 27, CTA rec.) thet the amouat of 77,22 was paid on April 16, 1956, or a period of over two (2) years counting from the dete of said payweat up to the 269

«Je

time the petitioner filed a suit for the recovery thereof when he sent his "Petition for Review" to this Court by wegistered mail on June 93, 1988 (pe 5S, GTA nece). (Panay Blectric Cos, Inc. vS. Gollector of Internal Aevenue, Ge fe NOy Le LOS74, May M8, 1908; Collector of Internal Revenue v6. University of Sto, Tonas, G, Re No, L110, wovember 2, 1956.)

WRABFQE, in view of the foregoing considerations, the respondent Commissioner of Internal Heverwe is hereby ordered to refund to the petitioner Conrado Larida the sum Of 0499.44 which the latter wes sequired to pay es percentage tax without Suthority of law, without pronounce= ment a8 to Costs.

ol UMEnhb, Mentla, September 29, 1959, ter ale ie ne ~

Associate Judge