ANGEL R.

QUIMPO v LEONCIO MENDOZA

G.R. No. L-33052, August 31, 1981
J. Guerrero

FACTS:
Quimpo, an owner of a building in Cagayan De Oro, was assessed
P20,000 for 1969, P400 annual realty tax payable in 4 equal installments.
Quimpo was able to pay the first 3 monthly installments but was not able to pay
the last installment.

In August the following 1970, he wanted to pay P124.00 (P100 tax due +
P24 penalty) to Mendoza, the City Treasurer of CDO, but Mendoza required him
to pay P196 (P100 + P96 penalty based on City Charter of CDO). Quimpo
consigned P124 with Clerk of Court then instituted mandamus with damages
against Mendoza in Court of First Instance.

CFI: dismissed the case based on Padilla v. City of Pasay and City
Treasurer
1. Pay P96 penalty = 2% of original tax which is P400
2. No authority to entertain suit for failure of Quimpo to comply with provisions of
Charter of CDO on payment of tax

ISSUE:

What should be the basis for computing the tax penalty, the tax payable
for the said year or only the installment unpaid?

RULING:

The computation of the tax penalty should be based on deficiency on

unpaid installment.

Based on the general rule in the interpretation of tax statutes that such
statutes are construed most strongly against the government and in favor of the
taxpayer. Moreover, fairness and reason cannot countenance an exaction or a
penalty for an act faithfully done in compliance with the law. Since petitioner is
allowed by law to pay his real estate tax in four equal installments due and
payable on four specified dates and having paid the first three (3) installments
faithfully and religiously, it is manifest injustice, sheer arbitrariness and abuse of
power to penalize him for doing so when he fails to pay the fourth and last
installment.

Further, the decision made in Padilla v. City of Pasay is not applicable in

the case as the said case was decided before RA 5447 took effect in January 1,
1969, thus it was based on R.A 521. The petitioner in this case had his real
property tax assessed for 1969 where RA 5447 is already applicable. RA 5447
amends city charters by providing that real property tax is due and payable in 4
equal installments. Thus, each installment is due and payable on or before a
specified statutory limit. Default in 1 installment, the penalty for delinquency
should be computed starting the day after the due date when the tax payer
should have paid.

Thus, with the promulgation of R.A No. 5447, the computation of the
penalty of two percent per month of delinquency should be based on the
installment amount due and not the original tax due.