CTA Case No. 2199 (Decision)

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DECISION - CTA CAS~ NO . 2199 (13) may come up. Anf1 usually, wh~n it is a "!.nck roC>f with intention f ��r GthGr use - like per - haps dancing placn, or party plac8 Qr party r0em, the deck is ef nicer finish - I m~an thA finish is nicer than on~ with or~inary roofing. NaturallL the cost of building will inrr r> as e very much -- much hi~hnr than a builring with only g.i. roofing. P. 83-~t . s . n .; unrer�- lining supplied.) Under th~s e circumstanr~s, we beli~V'3 that the assess- ment 0f the deck roc~ ~f the Ort:;ga Blng . is justifin~. Respendent Board in its ~ncision�with r~sp.nct t~ the elevatDr, applying Sertion 53 of the Chart.nr f Manila (Republic Act NG . 409, as amende~ by R~publir Acts Nos. 1928 and 3899) , whirh prDvi~es as f~ll~ws: 5EC . 53 . Powers and dut1ns ~f thn Cit~ Assess~r.- X X x. Th~ rity Ass~ssor XXX shall appraise an~ value all the r~al estate net e:xpr:;ssly exempt , � axc~pt machin~s, mnrha- nical contrivances, ins trum.~nts, tools, impl n- ments, appliances, apparatus, an �_, paraphnrnalia used for industrial, agricultural or manufac- turing purp@ses whif'h s:hall be exclu~en fr ,m such valuation anr assessment whnth8r ~ ~t attache1 ts lands or builrings. x x x. ruled that said section sp~cifirally ex~mpts machi- neries, mechanical rDntrivances, instruments, tools, implements, applian(es, apparatus anr paraph<;rnalia used fer industrial, agrirultural or manufacturing purpeses; that the Ortega Bl"lg. is us~r for re>mrn~rrial and n t f r in~ustrial, agricultural or manufarturing purposes; an1 that, thernfore, thn el~vatcr noes not enj. y ex~mption from ass~~smnnt. Th<:? business of p~ti ti!Dnnr of r~nting h~.r building is not mer8ly a c mmerrial but alse an industrial undertaking r acti~ity; in short, th~ ronstrurtion . .'il 13

DECISION - CTA CAS~ NO . 2199 (14) ~f her building was for an in~ustrial purp~s~ . This Court has int~rpr~t~n a substantially similar provis - ion (Secti �n 3 Lf/) of the Ass~ssm~nt Law to th~ eff~rt that the t~rm 11industry'1 m~ans an y ~npartm~nt e~r branch ef art , occupatian or busin~ss ron~u r t~~ as a m~ans �f liv~lihmod or fer pr~fit , ~ s p~rially ene whirh .nmpl~ys much labor ani capital an~ i s a ~isti n rt branrh of tra~e , er a prm1uctivr> ent~rpris~ whirh ~mp::t.~ys rnlativ..,ly large am0unts of capital an~ or labar. (Philippinn Bulk C0rp0- ratien vs . Prov . Board of Ass~ssm~nt Appnals 9f N~gres Occidental , CTA 1730 , De~. 26 , 1967, riti~g Philippin~ Acetylene C~mpany vs . C9m::1 . of Customs, CTA No. 1147 , Dec . 26, 1963 . ) This Court nxpr~ss~~ th"' vinw in the latt~r (�ase that a pro~uctiv.n GhtnrpTis..,, among oth~rs, is one devot~d te th~ pro ~ urti0n or net r~turn ef w~alth; and that a 11 p'irson engag"'n in commnrrn or trar1Q. ~mploying much labor and capital is engagnn in in~ustry b~rausG the enterprise is pro~urtivn of r~sults, profits or bn- nefi ts . 11 On the basis of this int,.,rpr<>ta tien as to the mearying of 11 indus try , 11 p~ti tion"'r, by cons tru r_ting h~r ap a rt~ept building an~ by r~ntin~ i t , is ~ngag~~ in an pr�p~rty enta ils - murh r apital an~ labor whirh prs Aure s results, pr fits and bnn~fits. The ~l~vater of sai ~ building, ther~fQre , which is a marhin.nry or mnrhanical centrivance used to rarry the t.nnants an ~ th~ g~n~ral public to the various fl�ers of the buil1ing , is a device used fGr the effiri~nt opnration of thn build- .,

DW.CISI ON CTA CAS~ NO . 2199 (15) i ng; hcnc~ , i t is rna hih~ry r instrum~nt us~~ in an industry . Tho ~levat r , wi th a valun f ~7 0 , - 000 . 00, is th~r~for~ ~x~mp t from rnalty tax ~r.r~rtiv~ 1963 pursuant t S~('tien 53 f R,.,publi(' A(t Ne . 4o9 (Charter ef the Ci ty f Manila) , as amnnn~~ by R~ public Acts N s . 1928 an~ 3899 . In (' nnecti~n with th~ assnssm~nt ef th~ ma('hin~ r ef at P3,750 . 06 , w~ n9tir~ that n~ith~r thn p~tition f r review nor petiti n~r�s m~~oran~um a~vanre~ any r sa s n te justify the n ranc~llati er mg~ificatien thereof . F r fail ur ~ t r~but the fin~ing ef rnsp@n~- ~nt , th~ assessmnnt of thn marhin? r�om must be sus- tained . Finally, petiti ner allng.-,s that shn shoul~ net� bn h~l~ liabl~ for the payment of the penalty f r the delay in the payment f h~r r~alty tax n said buil4- ing which was not ~ue to h~r fault . Sh~ (entrm -1s that such ~el a y was ~ue t . th~ failur~ of th~ City Boar ~ f .Ass~ssment Appeals t r 'nsolvn immerliately h~r pr - test against the assessment . We beli~ve that this C urt la('ks (omp~t~nc~ tG pass upon the issue as to wheth~r r not petiti n-r is liable for tht> penalty for the r~elay in the paymnnt ef her raalty tax . It sh ul~ bn n t~~ that the ass~ss- ment f the City Assessor an~ his nenial of petiti ner�s protest, which was app~al~r-1 t the rnsp n~ent Boar ~ , ....,id I not imp sa any penalty. (~hs. A & B; supra . ) In eth~r w rds, no decisi~n has been r~n~er3~ by thn City As- ~~ 15

DECISION - CTA CAS~ NO . 2199 (16) sessor on the question ~f th~ all~g~r'l penalty, as - suming that he has juris~iction t i mposn it , whi ch c ul d be properly ~ levateo to th~ r~sp0n0~nt B ar d fer ravi ~ w . R e sp@n~ent Boar~ , ther e f~r~ , r orr n rtly deelined te pass upon this is s u~ for .lark of juris- dictien . Since r ~ sp~nd~nt Boarn is b~r~ft of jur i s- diction t~ pass ~n the sai~ issue , it ne c ess~rily fol - l�ws that this Court, whos e juris ~ irti~n is 1imit~d to a review of the de ri~i�ns of City an0 Provin(ial Bear ns ef Assessmen t App~als, is lik~wis e with0ut juris~icti~n eve r the same . (Se es. 7(3) & 11, Rnp . Art No . 1125 . ) WH~ ~FOR E , the na cisien appeal~0 fr@m is h~r n by modifi3d . The ass ~ ss mn nt f pntit i oner�s apartment b~ilding for real estate tax purp~s e s . is her nby r er'l uren t P487,000 . 00 effnctiv~ 1963 (P557,000.00 l ess P70,000.00, the value ef the e l evat0r ) . With q )s�ts against p~ titien n r. SO ORDER T?D. Que z~n City, January 31, 1972. (3GD . ) ROMAN M. UHALI Pr esi ning Jur1ge WT<J CONCUR � (SGD . ) ESTANISLAO R. ALVAR ~Z Ass9 ciat e Ju r'l g ~ (SGD . ) RAMON L . ~\VANf'H;NA Asso ciat e Ju rl ge l~ 16