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E. Tax Refund and Tax Credit: Revenue Code of Manila (RRCM), Said
E. Tax Refund and Tax Credit: Revenue Code of Manila (RRCM), Said
GR No. 175723, 04 February 2014 ISSUE: Whether or not the CTA has jurisdiction
CITY OF MANILA v. HON. GRECIA-CUERDO, over a special civil action for certiorari assailing an
SM, STAR APPLIANCE CENTER, SUPERVALUE, interlocutory order issued by the RTC in a local tax
INC., ACE HARDWARE, WATSON, JOLLIMART, case.
SURPLUS
HELD: YES.
2. Petitioners availed of the wrong remedy when Hence SM Group filed a judicial action for a TRO
they filed the instant special civil action for and for a refund of the taxes they paid under
protest against Toledo, the City Treasurer of Manila on October 20, 2003 and November 14, 2003,
and City of Manila (petitioners, for brevity) with the respectively. It took them almost two (2) years
RTC Manila. from the date of receipt of the denial of the protest
on November 22, 2001 to seek judicial recourse;
RTC Manila declared the assessments made on way more than the legally prescribed thirty (30) day
taxes paid under section 21 are null and void period.
ordering refund or alternatively, to issue tax credits Accordingly, the subject assessments became
for the amount. Hence, this petition for review by conclusive and unappealable when respondents
the City treasurer. failed to question the same before a competent
court within thirty (30) days from receipt of the
1st ISSUE: WON THE ASSESSMENTS OF LOCAL denial of their protest under the rules.
BUSINESS TAXES FOR THE FOURTH (4th)
QUARTER OF YEAR 2001 UNDER SECTION 21, 2nd ISSUE: WON SM Group can CLAIM FOR
ARE FINAL AND COLLECTIBLE, AND REFUND – No.
THEREFORE, VALID - Yes
RULING:
RULING:
Based on Section 196 of R.A. No. 7160, there
Petitioners are correct in contending that that the are two requisites for a refund claim or tax
RTC did not acquire jurisdiction due to respondents' credit of local taxes, namely:
failure to file the Amended Complaint within the
prescribed period, including the failure to file a (1) a written claim for refund or credit must be
written claim for refund or credit, in violation of R.A. filed with the local treasurer before filing an
No. 7160. action for refund with the appropriate court;
At the outset, it must be pointed out that the nature, (2) the refund claim or tax credit must be filed
applicable statutory provisions and requirements of before the court within two (2) years from the
an assessment and a claim for refund differ. In local date of payment of the tax, fee or charge.
taxation, Section 195 of R.A. No. 7160 provides for
the remedies available to taxpayers in case of Although SM Group satisfied the second requisite
assessment; while Section 196 of the same Code (filing claim of refund before the court) as
refers to the requirements for refund. prescribed in Section 196 of R.A. No. 7160, they
had failed to file a written claim for refund or
In the CAB, SM Group of companies submitted a credit with the petitioner local treasurer, under
letter of protest dated October 19, 2001 addressed the first requisite, in violation of the same provision.
to the City treasurer. The City treasurer Compliance with the two requisites is
responded, denying the letter of protest which was mandatory.
received by SM Group on November 22, 2001.
Letter of protest dated October 19, 2001 is not
Records indicate that although respondents filed a treated as a written claim for refund as settled in
protest on the assessments on October 19, 2001, China Banking Corporation vs. City Treasurer of
the Petition filed before the RTC was filed beyond Manila. this Court declared that a written protest
the reglementary period. Section 195 of R.A. No. cannot be considered as a written claim for refund,
7160 categorically states that "the taxpayer and ruled that: The above letter (of protest)
shall have thirty (30) days from the receipt of speaks for itself. The wordings of the letter are
the denial of the protest or from the lapse of the explicit and unequivocal that petitioner merely
sixty (60)-day period prescribed herein within notified the respondent that it is paying under
which to appeal with the court of competent protest the amount representing the alleged local
jurisdiction otherwise the assessment becomes government tax and that they are presently
conclusive and unappealable". The denial of the instituting the appropriate legal actions to effect
protest was received by respondents on November refund of any erroneous/excessive payment made.
22, 2001; however, they failed to contest the same It is not the written claim for refund as
before a court of competent jurisdiction within the contemplated under Section 196 of the Local
allowable period, viz., thirty (30) days from receipt Government Code.
of the denial of the protest. In fact, respondents
only filed their Petition and the Amended Complaint
Having failed to comply with the requirements Provided, however, That such appeal shall not
prescribed by Section 196, the complaint for refund have the effect of suspending the effectivity of the
was prematurely filed for failure to exhaust ordinance and the accrual and payment of the tax,
administrative remedies. Where the enabling fee, or charge levied therein:
statute indicates a procedure for administrative
review, and provides a system of administrative Provided, finally, That within thirty (30) days after
appeal, or reconsideration, the courts, for reason of receipt of the decision or the lapse of the sixty-day
law, comity, and convenience, will not entertain a period without the Secretary of Justice acting upon
case unless the available remedies have been the appeal, the aggrieved party may file appropriate
resorted to and the appropriate authorities have proceedings with a court of competent jurisdiction.
been given an opportunity to act and correct the
errors committed in the administrative forum.
Pelizloy Realty Corporation vs. Province of
The afore-quoted case squarely applies in the Benguet
instant case. Respondents' letter dated October
19, 2001 disputing petitioners' assessments of FACTS:
local business taxes for the fourth (4th) quarter
of year 2001, is merely a protest-letter, and Petitioner Pelizloy Realty Corporation ("Pelizloy")
should not be treated as a written claim for owns Palm Grove Resort, which is designed for
refund. In said letter, respondents did not recreation and which has facilities like swimming
categorically request for the refund of the pools, a spa and function halls. It is located at Asin,
amount they paid as local business taxes. Angalisan, Municipality of Tuba, Province of
Hence, respondents failed to comply with the Benguet.
requirements of Section 196 of R.A. No. 7160.
There being no written claim for refund or credit On December 8, 2005, the Provincial Board of the
filed with the petitioner local treasurer, the RTC Province of Benguet approved Provincial Tax
did not acquire jurisdiction over respondents' Ordinance No. 05-107, otherwise known as the
refund claim. Thus, the RTC's decision granting Benguet Revenue Code of 2005 ("Tax Ordinance").
respondents' claim for refund is void. A void Section 59, Article X of the Tax Ordinance levied a
judgment for want of jurisdiction is no ten percent (10%) amusement tax on gross
judgment at all. receipts from admissions to "resorts, swimming
pools, bath houses, hot springs and tourist spots."
F. Challenging Tax Ordinance Section 162 of the Tax Ordinance provided that the
Tax Ordinance shall take effect on January 1, 2006.
On May 21, 2008, the RTC denied Pelizloy’s In Philippine Basketball Association v. Court of
Motion for Reconsideration. Appeals, the Supreme Court had an opportunity to
interpret a starkly similar provision or the
Aggrieved, Pelizloy filed the present petition on counterpart provision of Section 140 of the LGC in
June 10, 2008 on pure questions of law. It assailed the Local Tax Code then in effect. Petitioner
the legality of Section 59, Article X of the Tax Philippine Basketball Association (PBA) contended
Ordinance as being a (supposedly) prohibited that it was subject to the imposition by LGUs of
percentage tax per Section 133 (i) of the LGC. amusement taxes (as opposed to amusement
taxes imposed by the national government). In
support of its contentions, it cited Section 13 of
Presidential Decree No. 231, otherwise known as Considering these, it is clear that resorts, swimming
the Local Tax Code of 1973, (which is analogous to pools, bath houses, hot springs and tourist spots
Section 140 of the LGC) providing the following: cannot be considered venues primarily "where one
seeks admission to entertain oneself by seeing or
Section 13. Amusement tax on admission. - The viewing the show or performances". While it is true
province shall impose a tax on admission to be that they may be venues where people are visually
collected from the proprietors, lessees, or operators engaged, they are not primarily venues for their
of theaters, cinematographs, concert halls, circuses proprietors or operators to actively display, stage or
and other places of amusement xxx. present shows and/or performances.
Applying the principle of ejusdem generis, the Thus, resorts, swimming pools, bath houses, hot
Supreme Court rejected PBA's assertions and springs and tourist spots do not belong to the same
noted that: category or class as theaters, cinemas, concert
halls, circuses, and boxing stadia. It follows that
In determining the meaning of the phrase 'other they cannot be considered as among the ‘other
places of amusement', one must refer to the prior places of amusement’ contemplated by Section 140
enumeration of theaters, cinematographs, concert of the LGC and which may properly be subject to
halls and circuses with artistic expression as their amusement taxes.
common characteristic. Professional basketball
games do not fall under the same category as WHEREFORE, the petition for review on certiorari
theaters, cinematographs, concert halls and is GRANTED. SO ORDERED.
circuses as the latter basically belong to artistic
forms of entertainment while the former caters to
sports and gaming. [Underscoring supplied]
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