REPUBLIC CEMENT CX:%{, et al. vs. for the period from May, et al.

~EPUlJLIC Ol' THE PHILIPPINEI

COURT OF TAX APPE.ALB

QUEZON CITY

REPUBLIC CEMENT CX:%{;RATif"!·J,

Petitioner ,

-versus -

C.I.A. CASES r•s.

TI IE

CX'!~.1ISSif'I\iER C''F H 1TSRNAL

RSVENUE ,

X -

-

-

-1-

.espon .en~.. .

-

-

-

-

-

-

X

DECISICN

947 & 1519

The above entitled cases were submitted for de-

cision jointly as both involve the determination of the

amount of ad ..Y£:._2~ tax refundable to petitioner for

the period from May , 1957 to ~ebruary , 1965 , pursuant

to the final decision of the Supreme Court in G. P. ..

No . L-20660 (C .. T • . • Case No. 947, d~ ted June 13, 1968.

stri~0e of non-essentials , the facts are as

follows :

On November

1962, this Court :rendered judg-

ment in C.T.A. Case ,o. 947 , holding petitioner liable ·

for the sum of -~48 , 689.02 as deficiency royalty and/or

ad valo":'em t vx , in clu si ve of 25~;~ surcharge , for the

period from May? 1957 to December , 1959, with costs.

Not agreeable with the decision , peti ticner ap~ca led

to the Supremo Court (G. P. r-.ro. L 2()660 , cent en .ing ,

among others , that the correct basis of the imposition

of the ad y_c;Jore.m tax is the actual market value of the

r r v materials or mi n~ial products used in the

" manuf~c-

ture of cement upon ~heir extraction f~om the mines ,

D~CISION -

C5 ·::.A.

CAS83 ~~OS ~ 947 & 1519

and net the market value or selling 0rice of cement

as a finished prodlct , including the value of pape r

bag containers as he l d by r esponc.ent <Jnd suste.ine ..

by this Court.

Like •Jise , it was contender that it

•

was not liC~ble f o:r the payment o:: the 25~ ~ surcha:rge

for late payment , because all its payments were mnde

i n good f e1i th.

Pending appeal and because of the insist ent de-

m~nds o~ r espondent , petitioner paid under protest

the 1L valorem tax from June 15 , 1962 to

.~.pril 1 ,

1964 , in the total amount of

~7 23 , 273 . 04.

Subse-

quently , and within the time prescribed by law , on

June 15 , 196L! , petitioner filed its petition for re-

view claiming refund of the said amount b:3sed on the

same grounds alleged by it in C . T . A ~ Case

~ . 947.

On June 13 , 1968 , the Supreme Court promul gated

its de cision in G. R. No . L- Z::66C (c. T. A. C0se No. 947 ,

mod ifying the decision of t his Court and hal

~ng ,

inter-alia , that the ad valorem t ax should be based

on the a ct~ market value of the· mine ral products

upon extraction the reof from the mines , and not on

the cost of extraction.

According~y , the cost of the

paper bag containers i s not includible in the compu -

tation of the ad valorem tax 2nd/or royalty collectible

by the Government.

Eowever , petitioner was held liable

for the 25;S s ur c ha ~ge for late payment.

1he Supreme

Court sai d:

DECISIO ~ - C. T. fl ••

CASES NOS. 947 & 1519

"

-

.,j

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"In conclusion , petitioner is bound

to pay the 1~5'

1 ad valorem tax on the actual

rna ket value of the mine~a ls or mineral

products extracted from its mines, ~ith a

255'G. surcharge for failure to mnke said pay-

ment within t he prescribed time.

No evi-

dence having been introduced , however , on

said actual

m~rket value, the records are

hereby remanc:ed to the Court of Tax

~.ppe::1ls ,

for the reception of evidence and further

proceedings not inconsistent with this de-

cision. x x x"

Conformably with th~ foregoing decision, the re -

cord of the case was remanded tot his Court for re-

ception of evidence on the market value of the mine-

rals or mineral products extracted from the mines to

determine the tax base in computing the 1~~~ ad valorem

tax and to enable this Court to arrive at the correct

amount refundable to petitioner in C. .A. Case No . 1519.

In order to abbreviate the Droceedings , and at

the instance of both parties, this Court granted them

the opportunity to administratively settle and deter -

mine the market val ue to be used as t he proper tax base

of the ad valo..f§.!!! tax .

In line with the aforesaid de-

cision of the Supreme Court , the amount refundable to

petitioner as determined by respondent is 1,016 .,451. 92,

from ~hich the sum of J46 ,487.00, representing peti-

tioner's income tax liability for 1969 , was deducted,

leaving a bal nee of ~969 , 964.92.

This determination

is contained in the letter dated December 18, 1969

sent by respondent to petitioner , and the latter has

agreed to said determination.

The pertinent portions

of the letter of re~pondent dated December 18, 1969

are reproduced below: