CTA Case No. 91 (Resolution)

Republic of the Philippines COURT OF 'TAX APPEALS Mc:'.nila STA. CLARA LUMBER CO . , INC . , Petitioner, - versus - C.T.A. CASE NO . 91 THE COLLECTOR OF INTERNAL REVENUE, Respondent . X- - - - - - - - -X RE S 0 L UT I 0 N This is in connection with the affirmative defense of l a ck of jurisdiction interposed by counsel fo~ resp~ndent Col- l ector of Internal Revenue in his answer to tho petition for review. Hore p.;:crticulnrly, respondent 1 s counsel alleges that this Court has no jurisdiction to entertain tho .present act ion because the appeal w:~lS filed beyond the 30- day period pres- cribed by section ll of Republic Act No . 1125 . Inasmuch as the issue raised is one of juris~iction , the Court , upon verbal motion made by counsel for the respondent on July 5, 1955 when this c ~se was called for hearing , ruled in open court that the same should first be resolved before proceeding with the trial of the case on the merits . The records of this case show that tho decision of res- pondent Collector of Internal Revenue which is the subject of the instant appeal wa s rendered on November 5, 1951. The peti- tioner Sta . Clara Lumber Co . , Inc . appealed the said decision to the then Board of Tax Appeals which decided the case in f avor of the respondent and against the petitioner on May 25, 1952 . Dissatisfied �vith the adverse dycision of the Board of Tax Ap- peals, the petitioner appeal ed said case to the Supreme Court . .. 2 5

RESOLUTION - C.T.A . CASE NO. 91 - 2- On V~ rch 30 , 1954, the Supremo Court r ende r ed a r esolu- tion on the appeal of t he pet i tioner, which r eads a s fo llows : "Following t ho decision in the case of Uni- versity of Sto . Toma s vs. Board of Tax Appeals , G.R. No . L- 5701, June 23 , 1953, the Court r e solved to dismiss , wit hout pr ejudic e the appeal in G. R. No . L- 5914, Sta . Cla r a Lumb er Co ., Inc . vs . Tho Bonrd of Tax Appeals . 11 A copy of this r esolution of the Supreme Court wns r eceived by the petitioner on April 19 , 1954, and from the r ecords of the Supreme Court i t became fina l nnd execut or y on May 4, 1954. Ten (10) day s nft er the a pproval of Republic Act No . 1125, on June 16, 1954, petitioner Sta . Clnra Lumb er Co..., Inc . fil ed with the Supreme Court a moti on for the r econsider ntion of the r esolution of tho sa id Court, dismissing the a ppeal without prejudice , but the sa id motion wa s deni ed by the Supreme Court it nppoa ring thd the motion for r econsidor ntion wa s fil ed long nft er the r esolution of Nnrch 30 , 1954 had become finnl. On March 5, 1955, the petitioner filed the insta nt peti- tion to r evi ew the deci si on of r espondent Collector of Int erna l Revenue of November 5, 1951 . With the abovc- st nt ed f a ct s a s a basis , which ar e uncon- trovert ed, the only que stion to r esolve i n this inc i dent is whe- ther or not t his Court ha s jurisdiction t o hear and deciae the instant ca s e . Section ll of the l aw cr eating this Court (Republic Act No . 1125) r eads in pa rt ns f ollows : 11 Soc . ll. Who mny a ppenl; ef fe ct of o.ppeal. Any pe rson, as socintion or corpor ation a dvers ely aff ect ed by a decision or ruling of the Collector of Int erna l Revenue, x x x x x may fil e an np- peal in th e Court of Tax Appenls within thirty d:.l s a ft er the r ecei t of such deci sion or rulin " Underscoring suppli ed . 26

RESOLUTION - C. T. A. CASE NO . 91 .,.. 3 - The above quoted provision should be a pplied and inter- preted in relation to the resolution of the Supreme Cour t dis- missing without prejudice .the app&c l of the petitioner her ei n in G. R. No . L- 5914, Sta . Clarn Lumber Co . , Inc . vs . the Board of Tax Appec.l s . In the case of Ipekdjio.n Herchnndising Co ., Inc . vs . Col- l ector of Interna l Hevenue , C. T. A. Co.se No . 107 , this Court in its resolution on July 26, 1955 , st~tod among others, in inter - pr eting an identical resolution of tho Supreme Court which wa s a l so rendered on Jvbrch 30 , 1954, the fo l lowing : 11 The resolution of the Supreme Court of March 30 , 1954, dismissing without prejudice the appeal of petitioner Ipekdj i an Merchandising Co . , Inc . was � based on the decision of the same Court in the case of University of Sto . Toma s vs . Bo::J.rd of Tax Appro l s , G. R. No . L- 5701, June 23 , 1953 . In the said case , the Supreme Court decl r..red Executive Or der No . 401- A of January 5, 1951 , creating the Boa rd of Tax Appea l s , as null and void in so far a s it depr i ved the Court s of First Instance of their jurisdiction to act on in- ternal revenue cases under section 306 of the Na- tiona l Internnl Revenue Code . Hore specifical ly, t he Supreme Cour t hel d that P::n�t IV of said Executive Or der which provided for the review of the decisions of the Boa rd of Tax Appea l s by the Supreme Cour t , was without force and effect . In other wo r ds , the Supr eme Cour t ' s ruling wa s thJ.t a pa rty adversely aff ected by a decision of the Board of Tax Appeal s cannot di r ectly appea l the Board ' s decision to the Supreme Court , but must first bring his ca se to t he Court of Fir st Ins- tance . " X X X The Supreme Court , therefor e , in its resolution of March 30 , 1954, in effect , r ul ed tha t it did not hnve jurisdiction over the appeal of the petitioner, and accordingl y dismissed it without depriving petitioner Ipekdjian Merchandising Co . , I nc . of its r ight, at th~t t ime , to bring i t s case to the pr oper Cour t of Fi rst Instance ." In the c:1 se at ba r , the only a vail<eble r emedy of the pe- titioner when it received on April 19, 1954, the Supreme Cour t ' s resolution of March 30 , 1954 dismiss~ng the ca se without preju- 27

RESOLUTION - C. T. A. Ci'. SE NO. 91 - 4- dice , wns to pay the sal es t nx assess ed ~nd demanded by tho res- pondent, and th en file a suit for it s r efund under s ection 306 of the Tax Code with th e Court of First Instance of ~~nila, be- cause at that time this ~ourt WJ S not yet in exist ence . Peti- tioner Sta . Clar a Lumber Co ., Inc . f a iled to t ake this step. vfith the creation of thi s Court on Juno 16, 1954, a new remedy w::>. s 11'1':ldo ava ilable to tho petitione r, i. e . to 11 file an a ppeal in the Court of Tax App eals within thirty days aft er the r eceipt of such decision or ruling . " (Section 11, Republic Act No . 1125 . ) Considering the circumstanc es of the instant case , the petitioner could have availed itself-of this new r e- medy, and for r ea sons of equity, this Court by a unanimous con- curronce of its memb ers , ha s resol ved that the thirty (30) day period within which to a ppeal to this Court in ca ses of simila r n2ture , should be count ed not from the r eceipt of r espondent ' s decision dated Novemb er 5, 1951, or of the Supreme Court ' s resolu- tion of March 30 , 1954, dismissing petitioner ' s appeal without prejudice , but from July 21, 1954, when this Court wa s already regula rly functi oning with the J ppointment of its two Judges a nd its Clerk of Court and with the a doption by it in the in- terim of the Rules and Regulations of th e defunct Board of Tax Appeals for tho guidanc e and observance of t axpayers who would like to que stion th e decisions of the Collector of Int erna l Revenue . We believe that Congr c;;ss in ena cting the organic law of this Court (Republic Act No . 1125) intended to provide a finality to the docisiong or rulings of th e Collector of Internal Revenue on the matter of an a ssessment of t axes in ea ch instance . It could not hJ.ve been t he i nt ention of Congress t o provide for a finality after the given 30-day period as r egards a ssessment . . 28

RESOLUTION - C. T. A. CASE NO . 91 - 5- made subsequent t o the effectivity of Republic Act No . 1125 and l eft without fi nality t hose assessments made prior t o said l aw. On the other hand, and to be consistent and r easonabl e, Congress must huve contemplated an application of the l aw in such a manner that all assessments of taxes must be given finality so th'3.t the instant case must be tr eated with this vi m-r in mind . In the case at bar, inasmuch as petitioner Sta . Clara Lumber Co . , Inc . fil ed its petition f or r evi ew only on fu rch 5, 1955 , or almost 9 months aft er the creation of this Court and f ar beyond July 21, 1954, when tho Court was r eady and open for busine ss , we a r e of the opinion that the same was filed beyond the r oglementa ry period within which to perfect nn appeal to this Court , as fixed by section ll of Republic Act No . 1125 . I N VIEW OF THE FOREGOING CONSIDERATIONS, the "Petition for Review" fil ed on lv!:arch 5, 1955 by Sta . Clara Lumb er Co ., Inc . , is her eby dismissed f or l a ck of jurisdiction . SO ORDERED . Manila , Philippines, Sept ember 20 , 1955 . ( SGD . ) HARIANO NJ.BLE Presiding Judge (SGD.) AUGUSTO M. LUCIANO (scm � ) ROHAN M. UMALI Associate Judge Associate Judge /Cr 29