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TAXPAYERS REMEDIES ON ASSESSMENTS

Any owner or person having legal interest in the property who is not satisfied with the action of the provincial, city or municipal assessor may, within sixty days from the date of receipt by him of the written notice of assessment , appeal to the local Board of Assessment Appeals of the province or city concerned by a petition under oath together with the supporting documents. (Sec 226, LGC; Chavez vs. Ongpin, 186 SCRA 331: Ramie textiles, Inc. vs. Hon. Mathay, 89 SCRA 586) The failure to appeal within the statutory period renders the assessment final and unappealable (Victorias Milling Co. vs. Court of Tax Appeals, 22 SCRA 1008) An error in the assessment must be administratively pursued (doctrine of primacy of administrative remedy) to the exclusion of ordinary courts whose decisions would be void for lack of jurisdiction (Montinola vs. Nelia A. Barlis Municipal Treasurer of Muntinlupa, et al., GR. No. 114231, May 18, 2001. An appeal does not suspend the collection of the tax as assessed without prejudice to a later adjustment depending on the outcome of the appeal (Sec.231,LGC) The board shall decide the outcome of the appeal within one hundred and twenty days from receipt of the appeal (Sec. 229, LGC), may be appealed within 30 days from receipt thereof by the taxpayer to the Central Board of Assessment Appeals composed of a chairman and two members to be appointed by the President for a term of Seven years( Sec. 230,LGC) The decision of the Central Board of Assessment Appeals In Meralco Securities Corporation vs Central Board of Assessment Appeals (L-46245,31 May 1982), the Supreme Court held that the special civil action of certiorari would be proper to question the decision of the Central Board of Assessment Appeals.

The recognized rule, said the Court, is the underlying power in the courts to scrutinize the acts of administrative agencies exercising quasi-judicial power on questions of law and jurisdictions even where no review is given by statute (citing 73 CJS 506; the same rule was adopted in Caltex vs. Central Board of Assessment Appeals, L150466,31 May 1982.) The Court of Tax Appeals still has appellate jurisdictions over real estate assessment appeals, the Supreme Court in Caltex (Phil.), Inc. vs. Central Board of Assessment Appeals(L-50466, 31 May 1982, 114 SCRA 296)held in the negative and explained , thus : ``When Republic Act 1125 created the Tax Court in 1954 there was no Central Board of Assessment Appeals . (Sec. 7(3) of that law, in providing that theTax Court has jurisdiction to review by appeal decisions of provincial and city boards of assessment appeals, and not the Central Board of Assessment appeals which under the Real property Tax Code now has appellate jurisdiction over decisions of said local boards of assessment appels and is in the same category as the Tax Court The Intermediate Appealate Court (now Court of Appeals), has no jurisdiction to entertain appeals from decisions of the Central Board of Assessments Appeals (BP 129).

PAYMENT UNDER PROTEST

No protest shall be entertained unless the tax is first paid. When a tax payer desires for any reason to pay his tax under protest, he shall indicate the amount or portion thereof which he is contesting and such protest shall be annotated on the tax receipts by writing thereon the word paid paid under protest The protest shall be confirmed in writing with a statement of the ground thereof, within thirty days. The written protest shall be filed with the provincial, city or municipal (within Metropolitan Manila Area) treasurer who shall decide the protest within sixty days from the receipt of the protest. In the case of payments under protest, the amount or portion of he tax contested shall be held in trust by the treasurer and the difference shall be treated as revenue.

In the event tat the protest is finally decided in favor of the protestant, the amount or portion of the tax protested against may either be refunded to the protestant or applied as tax credit to any other existing or future tax liability of the said protestant. If the protest is denied or upon the lapsse of sixty days without the protest being finally decided, The taxpayer may avail of the remedies as provided for in Chapter 3, Title Two, Book II of the Code. This is to say that an appeal may be taken to the boards of assessment appeals (Sec. 252,LGC). So that in case of Meralco vs. Nelia Barlis , Op. cit, it was held that the trial court(RTC) has no jurisdiction to issue a writ of prohibitions which seeks to set aside the warrant of garnishment over petitioners bank deposit in satisfaction of real property taxes without paying first under protest the tax assessed and without exhausting available administrative remedies. Under Section 64 of the Real Property Tax Code payment under protest of the Tax assessed is a condition sine qua non before the Trial Court could assume jurisdiction over the petition.

WHEN PROTEST IS EXCUSED

In ramie Textiles, Inc. vs. Hon. Ismael Mathay (89 SCRA 586), the Court held :

Protest is not a requirement in order that a taxpayer, who paid under a mistaken belief that it is required by law, may claim for refund Section 54 of Commonwealth Act. No. 470, does not apply to petitioner which could conceivably not have been

expected to protest a payment it honestly believed to be due.

The same refers only to the case where the tax payer, despite his knowledge of the erroneous or illegal assessment, still pays and fails to make the proper protest, he could manifest an unwillingness to pay, and failing so, the taxpayer is deemed to have waived his right to claim a refund. In the case of bar, petitioner, cannot be said to have waived his right. He had no knowledge of the fact that it was exempted from payment of the realty tax under Commonwealth Act. No. 470. Payment was made through error or mistake, in the honest belief the petitioner was liable and could not have been made under protest, but with complete voluntariness. A taxpayer should not be held to suffer loss by his good intention to comply with what he believes is his legal obligations, where such obligation does not really exist In Quimpo vs. Mendoza( 107 SCRA 73), the Supreme Court said that the requirement of payment under protest refers only to the real estate tax, and courts are not thus deprived of authority to entertain claims on penalties imposed without such payment under protest.

REFUND ON OVER-PAYMENTS

When it appears that an assessment of real property or the tax levied is illegal or erroneous when made and the same is accordingly reduced or adjusted, the taxpayer may file a written claim for refund or credit for taxes and interest with the provincial or city treasurer within two years from the date the taxpayer is entitled thereto. If the claim is denied, or it is not decided within sixty days, the taxpayer may avail himself of the remedy of appeal to the boards of assessment appeals as in protest cases (Sec.253, LGC). Under the old law, a written claim for refund was not necessary. Timely notice was given by the Provincial or City Treasurer to every taxpayer whose assessment was so reduced and he was furnished a certificate showing the amount of refund to which he was entitled for payment already made (Sec. 63, RPTC). The old law, unlike the Local Government Code, did not provide for an appeal to the boards of assessment appeals nor any prescriptive period. Thus, the judicial action for refund was held to prescribe in six years under the general rules on prescriptive periods (Art.1145 of the Civil Code).

In Raime Textile, Inc. vs. Hon. Mathay (89 SCRA 586), the Court ruled:

The quasi-contract of solution indebiti is one of the concrete manifestations of the ancient principle that no one shall enrich himself unjustly at the expense of another. Hence, it would seem unjustified for the government that, knowing it has no right at all to collect or to receive money

for alleged taxes paid by mistake, it would be reluctant to return the same.

Respondents contention that petitioners right to recover real estate taxes has prescribed in accordance with Section 359 of the Revised Manual of Instructions to Treasurers x x x is without merit. The said provision applies to taxes paid under the ordinances subsequently declared illegal or taxes illegally assessed and collected under such ordinances, but not payments of real estate taxes mistakenly made, as in the present case. Furthermore, the Revised Manual of Instructions to Treasurers is a mere compilation of existing accounting instructions affecting finance and administration of local governments. Section 359, particularly, has no force and effected of a law, and the same cannot prevail over the provisions of the New Civil Code. The legislative intent on the Local Government Code appears to be that any issue relating to real property taxation that a taxpayer is minded to raise against the government, whether it be a question on the validity of the assessment or of the imposition and collection of the tax, should be resolved via the administrative route until it may ultimately reach by way of appeal, the Central Board of Assessment Appeals. From the latters decision, judicial recourse should still be appropriate following the ruling in the Meralco and Caltex cases (supra). When the issue, however, is one that centers on who should bear the burden of the tax between two private parties, the regular courts, not the assessment boards, have jurisdiction over the case (Testate Estate of Concordia T.Lim vs. City of Manila, 182 SCRA 482)