Alexandra Gerardine S.

Escucha

San Beda College Alabang- School of Law

STATCON
Nos. 24116-17 August 22, 1968

Cebu Portland Cement Company, vs. Mun. of Naga, Cebu, et. al.

plaintiff-appellant defendants-appellees

Facts:

1. The Treasurer of the Mun. of Naga, Cebu collected from Cebu Portland Cement
Company (CPCC) municipal license tax imposed by the Amended Ordinance No. 21 on
cement factories located in the same municipality.

2. The demands made by the Treasurer were not entirely successful and resulted to the
remedies provided under Section 2304 of the Revised Administrative Code. The
Treasurer gave CPCC 10 days to settle the account.

3. The Treasurer also notified the Plant Manager of CPCC that he was distraining 100,000
bags of Apo cement in satisfaction of their municipal license tax in the total amount of
Php 204,300.00. At first the Plant Manager did not agree with the letter but
acknowledged the distraint in the afternoon of the same day he was notified.

4. The Treasurer signed the receipt of the goods under the authority of 2304 of the Revised
Administrative Code & shall sell the same at a public auction to the highest bidder. The
proceeds thereof shall be utilized in part of the satisfaction of the municipal license tax &
penalties CPCC owes to the municipality of Naga, Cebu.

5. The Notice of Sale was posted by the Treasurer & stated that the public sale shall be on
July 27, 1962. However, no sale was held on the date specified & in the appealed
decision, that there was a stipulation by the parties where the auction took place on
January 30, 1962.

WHO WHAT WHERE DECISION

Cebu Portland Petition (2 separate RTC Denied
Cement Company actions: Validity of the
distraint & the sale at
a public auction of the
bags of cement)
Cebu Portland Motion for Supreme Court Denied
Cement Company Reconsideration

Issue

1. Whether the distraint was valid.

2. Whether the auction sale was valid

Decision
Alexandra Gerardine S. Escucha

San Beda College Alabang- School of Law

STATCON
Decision of the lower court was affirmed in toto. With costs against the plaintiff-appellant.

1. CPCC alleged that the 10-day grace period in the letter of the Municipal Treasurer
did not lapse and therefore, the distrain is invalid. This is not true. According to the
Revised Administrative Code, ‘the municipal treasurer may seize & distrain any
personal property belonging to such person or any property subject to the tax lien, in
sufficient quantity to satisfy the tax or charge in question xxx”. With this, the law
gives an authority to the municipal treasurer to seize & distrain properties regardless
of the provisions or conditions stated in the letter. There is only room for application
and not for interpretation and what is stated in the letter cannot amend the law.

2. The auction sale is also valid. Under the Revised Administrative Code, the sale
cannot take place ‘less than 20 days after notice to the owner or possessor of the
property xxx’. Since the first notification for distrait was in July 6, 1961 & the sale was
on January 30, 1962, the requisite for the notification was more than complied with.
The sale was only delayed due to the deferment made by the CPCC. Even if the sale
was made only in January 1962, the Treasurer informed the CPCC’s acting officer
that he would again advertise for the public sale of the said bags of cement. With
this, the validity of the date of the said auction sale cannot be contested.