Republic of the Philippines

CENTRAL BOARD OF ASSESSMENT APPEALS Manila

MAXON SYSTEMS (PHILS.), INC., Petitioner-Appellant,

– versus –

BOARD OF ASSESSMENT APPEALS OF THE PROVINCE OF CAVITE,
Appellee,

CBAA CASE NO. L-05 Re: Tax Declaration
No. 11584 & 11585

– and –

THE PROVINCIAL ASSESSOR OF THE PROVINCE OF CAVITE AND MUNICIPALITY OF ROSARIO, CAVITE,
Respondents-Appellees. x – – – – – – – – – – – – – – – – – – – – – – – – – – – x

RESOLUTION

Subject of this appeal is the following letter which purports to be the

Decision of the Local Board of Assessment Appeals (LBAA) of the Province of

Cavite, on the above-entitled case:

“REPUBLIC OF THE PHILIPPINES DEPARTMENT OF JUSTICE
LAND REGISTRATION AUTHORITY REGISTER OF DEEDS PROVINCE OF CAVITE

February 2, 1993

ATTY. PERRY L. PE Fourth Floor, Kings Court 2129 Pasong Tamo, Makati Metro Manila

S I R :

This has reference to your letter dated January 26, 1993, requesting for a reconsideration on the Provincial Board of Assessment Appeals’ stand, re: your appeal on Assessment involving Tax Declaration Nos. 11584 and 11585, both in the name of Maxon Systems (Phil.), Inc.

In reply thereto, please be informed that in our letter to Mr. Renato Reyes, Acctg. Manager of Maxon Phil, dated January 6, 1993, the Board had already made its stand clear that payment of the corresponding realty tax is a condition precedent before an appeal on assessment may be resolved.

While it may be true that many provisions of P.D. No. 76 had already been repealed by the New Local Government Code, yet Section 231 of the same Local taxation and Fiscal Matters Local Government Code of 1991, likewise provides that “Appeal on Assessment of real property made under the provisions of this Code, shall in no cases, suspend the collection of the corresponding realty taxes on the property involved as assessed by the

Reference: Book VII, pp. 42-52

provincial or city assessors, without prejudice to subsequent adjustment depending upon the final outcome of the appeal in CBAA Case No. 69, entitled, “Fortune Cement Corporation, Petitioner-Appellant vs. Board of Assessment Appeals of Batangas Province and Provincial Assessor of Batangas, Respondent-Appellee, held that the requirement of No. 7 Par. 3 of P.D. No. 76, (similar to that provided in the New Local Government Code), which states:

“The Appeal, however, shall not suspend the collection of the corresponding realty taxes as assessed by the provincial and city assessors, without prejudice to subsequent adjustment depending upon the final outcome of the appeal.”

applies to all appeals from assessment made by the city assessor and provincial assessor.

In the light of all the foregoing and in view of the fact that your appeal was received by this Board on December 28, 1992, and, therefore was already filed beyond the 60 day period within which to file your appeal, this Board believes and so holds that it may no longer entertain said appeal.

Should you disagree with the Board’s action taken herein, the matter may be appealed to the Central Board of Assessment Appeal for final decision.

Very truly yours,

(Sgd.) ANTONIA B. CABUCO Register of Deeds Cavite, Province”

Before this Board, Petitioner-Appellant, Maxon Systems (Phils.), Inc.,

alleges the following:

“Firstly, it does not appear that the appealed letter-decision dated February 2, 1993, carried the conformity of the Provincial Engineer of the Province of Cavite, who are both likewise members of the BAA, in accordance with Section 227 of the Local Government Code (“LGC”).”

“Secondly, it appears that only the chairman of the BAA rendered this appealed decision, and she rendered it not as chairman of the BAA but in her capacity as the Provincial Register of Deeds of Cavite.”

“Thirdly, the appealed letter-decision was not formulated in the proper form.”

“Fourthly, petitioner-appellant’s original petition before the BAA was not even docketed in the records of BAA as can be seen by the lack of case number or docket number.”

Petitioner-Appellant then assigns the following errors:

“I. APPELLEE BAA ERRED IN HOLDING THAT THE PAYMENT OF REALTY TAX IS A CONDITION PRECEDENT BEFORE AN APPEAL ON ASSESSMENT CAN BE RESOLVED.”

“II. APPELLEE BAA ERRED IN HOLDING THAT PETITIONER-APPELLANT’S APPEAL ON ASSESSMENT WAS FILED BEYOND THE PRESCRIPTIVE PERIOD.”

“III, APPELLEE BAA ERRED IN NOT HOLDING THAT RESPONDENT-APPELLEES’ SUBJECT ASSESSMENTS VIOLATE THE

Reference: Book VII, pp. 42-52

PROVISIONS OF THE LGC AND THAT PETITIONER-APPELLANT IS TAX EXEMPT.”

It appears that on October 19, 1992, Respondent-Appellee, Provincial

Assessor of Cavite through the Municipal Treasurer of Rosario, Cavite issued a

Notice of Assessment imposing real property tax on several industrial

machineries owned by Petitioner-Appellant, copy of which was received by said

Petitioner-Appellant on October 21, 1992, together with Tax Declaration Nos.

11583, 11584, 11585 and 11586, covering the assessments of said

machineries. Taxes, however, were only imposed on Tax Declaration Nos.

11584 and 11585.

Contesting the assessment, Petitioner-Appellant appealed to the LBAA,

Province of Cavite, in a petition dated 18 December 1992, filed through the

Municipal Treasurer of Rosario, Cavite on the same date (18 December 1992),

in accordance with Revised Provincial Form No. 139-A, viz: “APPEAL ON

ASSESSMENT”.

The letter to Mr. Renato M. Reyes, AVP-ACCTG. Manager of Maxon

Systems (Phils.), Inc., dated January 6, 1993 signed by Antonia B. Cabuco,

Chairman, Board of Assessment Appeals, Province of Cavite, (SUPRA),

informed Petitioner-Appellant “that said appeal although dated December 18,

1992 was received by this Board on December 28, 1992 and, therefore is

already beyond the 60 day period within which to file the appeal considering

that you have received the Notice of Assessment last October 21, 1992 yet. On

the other hand, it may be amiss to state that payment of corresponding realty

tax is a condition precedent before an appeal on assessment may be resolved.”

In a letter to Hon. Antonia B. Cabuco, Chairman, Board of Assessment

Appeal, Province of Cavite, dated 15 January 1993 and received 21 January

1993, Petitioner-Appellant sought “reconsideration of this Honorable Board’s

letter dated January 6, 1993 and pray that our Appeal on Assessment with

regard to the subject case be accepted and be resolved within the period

provided by law”. The letter contends that: (1) it filed its appeal on December

Reference: Book VII, pp. 42-52

18, 1992, complying with the Revised Provincial Form No. 139-A specifically

directing the filing of the Appeal “to the Board of Assessment Appeals, Province

of Cavite” and (2) payment of the corresponding realty tax is not a condition

precedent before an appeal on assessment may be resolved, claiming that said

appeal is not a protest on assessment under Section 226 of the LGC where it is

questioning the basis of the assessment itself, and this matter operates as

prejudicial question to any realty tax payments.

This was followed by another letter dated 26 January 1993 to the same

effect, further, alleging refusal of Petitioner-Appellant’s appeal by the Office of

Respondent-Chairman of the Local Board of Assessment Appeals of Cavite, for

non-compliance with the requirements of P.D. 76 viz, tax payment is a condition

precedent before the Local Board of Cavite could entertain its appeal. It

“beseeched” the Cavite Local Board’s reconsideration on its Appeal, otherwise,

a formal decision thereto, so that the same could be appealed to the Central

Board of Assessment Appeals.

Hence, the letter-subject-of-appeal (supra) and this appeal.

The pertinent provision of P.D. 464 provides as follows:

“Sec. 37. Effect of Appeals on the Payment of Real Property Tax. – Appeals on assessment of the real property made under the provisions of this Code shall, in no case suspends the collection of the corresponding realty taxes on the property involved as assessed by the Provincial or City Assessor, without prejudice to subsequent adjustment depending upon the final outcome of the appeal.”

Comparably, Section 231 of the Local Government Code of 1991 which

law repealed P.D. 464 is a mere reproduction of Section 37 of P.D. 464, viz:

“Sec. 231. Effect of Appeal on the Payment of Real Property Tax. – Appeal on assessments of real property made under the provisions of this Code shall, in no case, suspend the collection of the corresponding realty taxes on the property involved as assessed by the provincial or city assessor, without prejudice to subsequent adjustment depending upon the final outcome of the appeal.”

In application of Section 37 of P.D. 464, this Board had established the

following ruling:

Reference: Book VII, pp. 42-52

We maintain that as previously ruled in the Fortune Cement case (CBAA

CASE NO. 69) the realty taxes due on the property as assessed by the

assessor should first be paid before the appeal may be entertained.”

The Supreme Court in the cases of Collector vs. Avelino (100 Phils. 327)

[1956] and Collector vs. Reyes (100 Phils 822) [1957] opined that “if the

collection of the tax would jeopardize the interest of the taxpayer, the Court may

at any stage of the proceedings require the taxpayer either to deposit the

amount claimed or file a surety bond for not more than double the amount with

the Court. Petitioner-Appellant here may be allowed to file a surety bond in lieu

of the required cash payment of the realty tax the amount of which must not be

less than the amount of the unpaid realty taxes and penalties as assessed by

the Provincial Assessor nor more than double the said amount. The surety

bond should be filed with the Provincial Board of Assessment Appeals of Cavite

which shall approve the same. It must be accompanied by a certification from

the Insurance Commissioner that the surety company is duly authorized to

issue such bond; that the surety bond is approved and registered with said

Commission and the amount covered by the surety bond is within the writing

capacity of the surety company. The excess of the surety company’s writing

capacity if such is the case must be covered by a Reinsurance Binder, in which

case, certification to this effect must likewise accompany the surety bond.” (See

CBAA Case No. 92, Herman B. Aranez, Inc. vs. Provincial Assessor of Eastern

Samar dated June 29, 1977).

“Collection of the realty taxes as assessed by the Provincial or City Assessor shall not be suspended by an appeal filed thereunder. While P.D. No. 76 does not contain any express provision that an appeal to this Board may not be entertained unless the taxes in question are paid (as expressly provided in Section 5 of Commonwealth Act No. 470), the result of the implementation of the above-quoted provision would substantially be the same. For under the latter, the protestant-appellant is obligated to pay the realty taxes as assessed by the Provincial or City Assessor notwithstanding the filing of an appeal. We believe that any other provision is by settled rules of construction to be abhorred and avoided.” (See CBAA Case No. 229, NDC Guthrie Plantation, Inc., vs. Provincial Assessor of Agusan del Sur, Nov. 24, 1986).

Reference: Book VII, pp. 42-52

To implement Section 231 of the Local Government Code of 1991, we

find no cogent reason to depart from or alter the foregoing rulings.

Be that as it may, it is the considered view of this Board that decisions of

the Local Boards of Assessment Appeals should be in proper form and properly

acted upon and signed by the Chairman and two members after proper notice

to parties and hearing.

Hence, the herein disposition in the Local Board on the matters of

jurisdiction and payment of taxes should be based on the action of the Local

Board after due process.

WHEREFORE, subject “Letter-Decision” appealed from is hereby SET

ASIDE and the case REMANDED to Appellee Local Board of Assessment

Appeals of the Province of Cavite, for further proceedings subject to a full and

up-to-date payment of the realty taxes on the subject properties as assessed by

the Respondent-Appellee either in Cash or Bond as required.

SO ORDERED.

Manila, Philippines, August 15, 1994.

(Signed) MARGARITA G. MAGISTRADO
Chairman

(Signed) ELEANOR A. SANTOS
Member`

(Signed) ALFONSO M. MEDADO
Member

Reference: Book VII, pp. 42-52