Republic of the Philippines
CENTRAL BOARD OF ASSESSMENT APPEALS
M a n i l a

PORTAL HOLDINGS, INC.,
Petitioner-Appellant,
CBAA CASE NO. L-61
-versus- LBAA Case No. 2004-04
Parañaque City
THE LOCAL BOARD OF ASSESSMENT APPEALS OF PARAÑAQUE CITY,
Appellee,

-and-

CITY ASSESSOR OF PARAÑAQUE CITY,
Respondent-Appellee.
x—————————————/

D E C I S I O N
This Appeal, dated February 16, 2005 and received by this Board on February 17, 2005, is from the Resolution rendered by the Local Board of Assessment Appeals of Parañaque City on 08 January 2005 in LBAA Case No. 2004-04 entitled “Portal Holdings, Inc., Appellant vs. City Assessor of Parañaque City, Appellee, which Resolution reads:

“This is an appeal on the Denial by the City Assessor of Parañaque City of the Appellant’s letter-protest dated 15 January 2004 against the Notice of Assessment issued by the Appellee based on the below-enumerated Tax Declarations,

Tax Declaration Number Lot Number

E-002-07533 15
E-002-07534 16
E-002-07537 17

which in turn, were issued pursuant to Parañaque City Ordinance No. 03-06, Series of 2003, entitled ‘An Ordinance Adopting A Straight Line Policy in the Determination of the Barangay Boundaries in the Reclaimed Areas in Manila Bay Within the Territorial Jurisdiction of the City of Parañaque.

The issues raised by the Appellant boils (sic) down to the constitutionality of City Ordinance No. 03-06, which is outside the jurisdiction of this Board. Article 275 of the Rules and Regulations Implementing The Local Government Code of 1991 provides as follows:

Article 275. PROCEDURE FOR APPROVAL AND EFFECTIVITY OF TAX ORDINANCE AND REVENUE MEASURES.

The procedure for approval of local tax ordinances and revenue measures shall be in accordance with the provision (sic) of this Rule provided that public hearings shall be conducted for the purpose prior to the enactment thereof provided further that any question on the constitutionality or legality of tax ordinances or revenue measures may be raised on appeal within thirty (30) days from the affectivity (sic) thereof to the Secretary of Justice who shall render a decision within sixty (60) days from the date of receipt of the appeal provided furthermore that such appeal shall not have the effect of suspending the effectivity of the ordinance and accrual and payment of the tax, fee, or charged (sic) levied therein and provided finally that within thirty (30) days after receipt of the decision or the lapse of the sixty-day period without the Secretary of Justice acting upon the appeal, the aggrieved party may file appropriate procedures with a court of competent jurisdiction. . . . . .

Therefore, since the issues raised by Appellant are anchored as to whether or not Parañaque City Ordinance No. 03-06, Series of 2003 is valid and/or constitutional, settlement of such question must be resolved in the proper forum, which will in turn answer all attendant questions.

The instant appeal is hereby DENIED.

8 January 2005.”

Petitioner-Appellant alleges that:

“1. Petitioner-Appellant it is a corporation duly organized and existing under the laws of the Philippines, with office address at the 5th Floor, LTA Building, 118 Perea Street, Legaspi Village, Makati City, Metro Manila.

“2. Petitioner-Appellant is the registered owner of three (3) undeveloped and reclaimed parcels of land known as Lots 15, 16 and 19 located at the Aseana Business Park, Barangay Tambo, Parañaque City, Metro Manila (the ‘Subject Properties’), all of which are covered by the appropriate Transfer Certificates of Title (‘TCT’) duly issued by the Register of Deeds for Parañaque, more particularly described as follows:

(Note: Technical Descriptions of Lots 15, 16 and 19, covered by Nos. 142454, 142290 and 142063, respectively, are omitted.)

“Petitioner-Appellant has been religiously paying the real property taxes (‘RPT’) due on the Subject Properties since the above-mentioned TCTs were issued in 1999.

“3. The RPT on the Subject Properties beginning the year 2000 was based on the assessed value of the Subject Properties as stated in the Declarations of Real Property (hereinafter, ‘Tax Declarations’) issued to Petitioner-Appellant, to wit:

Lot No. Declaration of Real Property No.
Market Value
Assessed Value
15 E-015-06816 P60,000.00 P30,000.00
16 E-015-06817 60,000.00 30,000.00
19 E-015-06822 63,510.00 31,755.00

“Copies of the foregoing Tax Declarations are attached as Annexes ‘B’, ‘B-1’ and ‘B-2’, respectively, of the Appeal dated 19 March 2004. (cf. Annex ‘A’ hereof)

“4. Some time in November 2003, Petitioner-Appellant confirmed from the Office of the City Treasurer of Parañaque (‘City Treasurer’) that, pursuant to Parañaque City Ordinance No. 02-17, Series of 2002 (the ‘Ordinance 02-17’), real property owners in Parañaque City are entitled to a twenty percent (20%) discount on RPT if the RPT due on real property for the succeeding year are settled in full on or before December 24 of the preceding year.

“5. Petitioner-Appellant likewise requested the City Treasurer to provide it with the computation of the exact amount of the RPT due on the Subject Properties for 2004 so that Petitioner-Appellant may obtain manager’s checks stating accurate amounts.

“6. Petitioner-Appellant then proceeded to tender under protest, full payment for the RPT due on the Subject Properties for the year 2004 to the City Treasurer on 18 December 2003, in the following amounts, and as evidenced by the following official receipts (‘OR’):

Lot No. TCT No. Amount of RPT Paid Official Receipt No.
15 142454 P 720,000.00 5490499
16 142290 720,000.00 5490496 (sic)
19 142063 762,120.00 5490495

“Copies of the foregoing official receipts are attached as Annexes ‘C’, ‘C-1’ and ‘C-2’, respectively, of the Appeal dated 19 March 2004. (cf. Annex ‘A’ hereof)

“7. In recognition of Petitioner-Appellant’s full payment of the RPT for 2004, the City Treasurer gave Petitioner-Appellant the corresponding twenty percent (20%) discount on the entire RPT due, pursuant to the provisions of Ordinance 02-17. Moreover, the City Treasurer annotated the phrase “Full 2004” on Official Receipt Nos. 5490499, 5490497 and 5490495, copies of which are attached as Annexes ‘O’, ‘O-1’ and ‘O-2’ of the Appeal dated 19 March 2004 (Annex ‘A’ hereof).

“8. On 11 February 2003, the City Council of Parañaque, without prior consultation with the proper parties nor the holding of the requisite plebiscite, enacted Parañaque City Ordinance No. 03-06, Series of 2003 (the ‘Ordinance 03-06’) unwittingly modifying the territorial boundaries of the barangays under the jurisdiction of the City of Parañaque, specifically those exercising jurisdiction over reclaimed areas in Manila Bay, to wit:

‘WHEREAS, the adoption of straight line policy is the most fair and practical way of settling boundary disputes among the different barangays over the reclaimed areas in Manila Bay;

x x x

SECTION 1. The territorial boundaries of the different barangays in the reclaimed areas in Manila Bay shall be determined by using the straight line method.

x x x

SECTION 111. The office of the City Assessor is hereby directed to implement the provisions of this Ordinance.

x x x’

“A copy of Ordinance 03-06 is attached as Annex ‘E’ of the Appeal dated 19 March 2004. (cf. Annex ‘A’ hereof)

“9. Ordinance 03-06 effectively resulted in the transfer of the Subject Properties from the jurisdiction of Barangay Tambo to Barangay Baclaran, thereby increasing the market and assessed values of the Subject Properties by one hundred percent (100%).

“10. On 16 January 2004, Petitioner-Appellant timely filed a letter-protest dated 15 January 2004 with the City Assessor of Parañaque to protest its payment of RPT on the Subject Properties on the basis of the following arguments:

‘The Corporation wishes to emphasize that Lots 15, 16 and 19 (the ‘Subject Lots’) are newly reclaimed and are still raw and undeveloped parcels of land.

Paragraph 14 of Parañaque City Ordinance No. 96-16, s. of 1996 provides that ‘all undeveloped parcels of land shall have 70% of the base value of the developed or improved lots located in that area.’ Paragraph 5 of the said Ordinance also states that ‘for low and sunken areas of land, a reduction from the base value per square meter may be allowed due to the cost of filling and compaction to bring the same at par with the adjoining developed lots; Provided, however, that such reduction will, in no case, exceed 30% of the base value thereof.’ In view thereof, the fair market value of the Subject Lots, for real property tax purposes and as indicated in the Corporation’s tax declarations, is erroneous and the real property taxes paid by the Corporation in previous years for the Subject Lots were excessive.’

“The same letter-protest likewise prayed for the reduction of the base unit cost of the Subject Properties for purposes of computing the real property taxes due thereon.

“A copy of the letter-protest dated 15 January 2004 filed by the Petitioner-Appellant is attached as Annex ‘F’ of the Appeal dated 19 March 2004. (cf. Annex ‘A’ hereof)

“11. On 20 January 2004, Petitioner-Appellant received three (3) new Tax Declarations covering the Subject Properties (the ‘New Tax Declarations’) issued by the City Assessor pursuant to Ordinance 03-06, clearly stamped with the words, ‘Change of Barangay Location in Compliance with Parañaque City Ordinance No. 03-06 Series of 2003.’

“Copies of the New Tax Declarations are attached as Annexes ‘G’, ‘G-1’ and ‘G-2’ of the Appeal dated 19 March 2004. (cf. Annex ‘A’ hereof)

“12. Petitioner-Appellant likewise received Real Property Tax Orders of Payment (‘Tax Orders of Payment’) together with the New Tax Declarations in which the only filled-up portion is that of the ‘Notice of Assessment’.

“Copies of the Tax Orders of Payment are attached as Annexes ‘H’, ‘H-1’ and ‘H-2’ of the Appeal dated 19 March 2004. (cf. Annex ‘A’ hereof)

“13. The New Tax Declarations and Tax Orders of Payment reflect the new market and assessed values of the Subject Properties beginning in the year 2004, to wit:

Lot No. Tax Declaration
No. Market Value Assessed Value
15 E-002-07533 P 120,000.00 P 60,000.00
16 E-002-07534 120,000.00 60,000.00
19 E-002-07537 127,020.00 63,510.00

“14. On 05 February 2004, Petitioner-Appellant received a letter dated 27 January 2004 from the City Assessor denying its letter-protest dated 15 January 2004 and Petitioner-Appellant’s prayer for a reduction of the base unit cost of the Subject Properties for purposes of computing the real property taxes due thereon. A copy of the said letter dated 27 January 2004 is attached as Annex ‘I’ of the Appeal dated 19 March 2004. (cf. Annex ‘A’ hereof.

“15. Notwithstanding its full payment of RPT on the Subject Properties for the year 2004, Petitioner-Appellant received on 18 March 2004 new Real Property Tax Orders of Payment assessing deficiency taxes for 2004 on the Subject Properties (the ‘New RPT Orders for Payment’) in the following amounts:

Lot No. Amount of Deficiency Tax
15 P720,000.00
16 720,000.00
19 762,120.00

“Copies of the New RPT Orders of Payment are attached as Annexes ‘J’, ‘J-1’ and ‘J-2’ of the Appeal dated 19 March 2004. (cf. Annex ‘A’ hereof)

“16. Thereafter, on 19 March 2004, Petitioner-Appellant timely filed its Appeal of even date with the Appellee praying the reversal of the following:

’16.1. The denial of its letter-protest dated 15 January 2004;

’16.2. The issuance of the New Tax Declarations and the Tax Orders of Payment containing the notices of assessment both reflecting the new market and assessed values of the Subject Properties;

’16.3. The issuance of the New RPT Orders of Payment indicating alleged tax deficiency RPT in the following amounts:

Lot No. Amount of Deficiency Tax
15 P720,000.00
16 720,000.00
19 762,120.00

“A copy of the Appeal dated 19 March 2004 is attached herewith as Annex ‘A’.

“17. On 15 September 2004, Petitioner-Appellant received the Comment/Opposition to ‘Appeal’ dated 06 September 2004 filed by the City Assessor.

“18. Thereafter, on 25 October 2004, Petitioner-Appellant filed with the Appellee its Reply to Comment/Opposition to Appeal (‘Reply’) dated 22 October 2004.

“A copy of the Reply dated 22 October 2004 is attached herewith as Annex ‘B’.

“19. On 18 January 2005, the Petitioner-Appellant received a copy of the Resolution dated 08 January 2005 issued by the Appellee, denying the Appeal dated 19 March 2004 filed by the Petitioner-Appellant solely on the ground that the Appellee has no jurisdiction over the case.

“A copy of the Resolution dated 08 January 2005 is attached herewith as Annex ‘C’.

“20. Notwithstanding the pendency of Petitioner-Appellant’s Appeal dated 19 March 2004 with the Appellee, Petitioner-Appellant paid under protest the alleged deficiency RPT on the Subject Properties for 2004 on 23 December 2004, as evidenced by Official Receipt Nos. 5508631, 5508630 and 5508632, copies of which are attached herewith as Annexes ‘D’, ‘D-1’ and ‘D-2’, respectively.

Note: The details of Petitioner’s payment on 23 December 2004, as per records, follow:

Tax Dec.
No. Def.
2004 Full
2005 Total
Paid O. R.
No. Date
Paid
E-002-07533 P720,000 P1,440,000 P2,160,000 5508631U 12/23/04
E-002-07534 P720,000 P1,440,000 P2,160,000 5508630U 12/23/04
Et-002-07537 P762,020 P1,524,240 P2,286,360 5508632U 12/23/04
Totals P2,202,020 P4,404,240 P6,606,360

“21. Hence this Appeal to the Honorable CBAA.

“ARGUMENTS

I

CONTRARY TO ITS RESOLUTION DATED 08 JANUARY 2005, THE APPELLEE ERRED IN STATING THAT IT HAS NO JURISDICTION IN AN APPEAL FROM A WRITTEN NOTICE OF ASSESSMENT ISSUED BY THE CITY ASSESSOR AND FROM THE DENIAL BY SAID CITY ASSESSOR OF PETITIONER-APPELLANT’S PROTEST FOR ITS PAYMENT OF RPT, IN ACCORDANCE WITH SECTIONS 226 AND 252(D) OF THE LGC.

II

NOTWITHSTANDING THE ISSUE ON THE APPELLEE’S ALLEGED LACK OF JURISDICTION, THE APPELLEE ERRED IN NOT RULING THAT THE ASSESSMENT BY THE CITY ASSESSOR OF ALLEGED DEFICIENCY RPT FOR 2004 ON THE SUBJECT PROPERTIES HAS NO BASIS SINCE THE RPT DUE THEREON FOR THE YEAR 2004 HAVE BEEN FULLY PAID.

III

NOTWITHSTANDING THE ISSUE ON THE APPELLEE’S ALLEGED LACK OF JURISDICTION, THE APPELLEE ERRED IN NOT RULING THAT PETITIONER-APPELLANT HAS VALID GROUND TO REQUEST FOR REAPPRAISAL OR REASSESSMENT OF THE SUBJECT PROPERTIES CONSIDERING THAT:

A. THE SUBJECT PROPERTIES ARE IN REALITY, RAW AND UNDEVELOPED PARCELS OF LAND, WITHOUT ANY IMPROVEMENTS; AND

B. THE INCREASE IN THE MARKET AND ASSESSED VALUES OF PETITIONER-APPELLANT’S PARCELS OF LAND WAS PRIMARILY DUE TO THE IMPLEMENTATION OF AN ORDINANCE THAT CLEARLY DID NOT COMPLY WITH THE MANDATORY REQUIREMENTS OF THE 1987 CONSTITUTION AND OF THE LGC.

IV

NOTWITHSTANDING THE ISSUE ON THE APPELLEE’S ALLEGED LACK OF JURISDICTION AND ASSUMING ARGUENDO THAT THE NEW TAX DECLARATIONS ISSUED FOR THE SUBJECT PROPERTIES ARE VALID, THE APPELLEE ERRED IN NOT RULING THAT THE SAME CANNOT BE MADE EFFECTIVE IN 2004.”

PETITIONER-APPELLANT’S DISCUSSION/ARGUMENTS

“I. Contrary To Its Resolution Dated 08 January 2005, The Appellee Erred In Stating That It Has No Jurisdiction In An Appeal From A Written Notice Of Assessment Issued By The City Assessor And From The Denial By The Said City Assessor Of Petitioner-Appellant’s Protest From Its Payment Of RPT, In Accordance With Sections 226 And 252(D) Of The LGC.

“The questioned Resolution cites Article 275 of the Implementing Rules and Regulations of Republic Act No. 7160, otherwise known as the ‘Local Government Code of 1991’ (‘LGC’), stating that the issues raised in the Appeal dated 19 March 2004 are anchored on the issue of whether or not Ordinance 03-06 is valid and/or constitutional, hence LBAA is not the proper forum to resolve the issue raised.

“Petitioner-Appellant respectfully submits that the resolution of the issues raised in the Appeal dated 19 March 2004 falls within the jurisdiction of the Appellee pursuant to the clear mandate of the LGC.

“The LGC provides the following remedy for a property owner dissatisfied with an assessment or reassessment issued by the provincial, city or municipal assessor. Thus:

‘SEC. 226. Local Board of Assessment Appeals. – Any owner or person having legal interest in the property who is not satisfied with the action of the provincial, city or municipal assessor in the assessment of his property may, within sixty (60) days from the date of receipt of the written notice of assessment, appeal to the Board of Assessment Appeals of the province or city by filing a petition under oath in the form prescribed for the purpose, together with copies of the tax declarations and such affidavits or documents submitted in support of the appeal.’ (Underscoring supplied)

“Moreover, Section 252(d) of the LGC likewise provides the following remedy for a property owner whose protest of payment of RPT was denied by the provincial, city or municipal assessor:

‘x x x (d) In the event that the protest is denied or upon the lapse of the sixty-day period prescribed in subparagraph (a), the taxpayer may avail of the remedies as provided for in Chapter 3, Title Two, Book II of this Code.’

“The foregoing provision also refers to the filing by a taxpayer of an appeal with the LBAA in the manner stated in Section 226 of the LGC, as quoted above. A real property owner is clearly given the opportunity to question actions made by the provincial, city or municipal assessors, among which is their issuance of written notices of assessment, or their denial of protests of RPT payments, in the pertinent LBAA. It bears emphasis that the Supreme Court has consistently ruled that protests against allegedly exorbitant assessment (sic) are within the competence of the Board of Assessment Appeals to hear and decide. [Chavez vs. Ongpin, 186 SCRA 331 (1990); Montinola vs. Gonzales, 178 SCRA 677 (1989)]

“Section 199 (f) of the LGC likewise defines ‘assessment’ as ‘the act or process of determining the value of a property, or proportion thereof subject to tax, including the discovery, listing, classification and appraisal of properties.’

“Section 199 (q) of the LGC likewise defines ‘reassessment’ as ‘the assigning of new assessed values to property, particularly real estate as the result of a general, partial, or individual reappraisal of the property.’

“When the City Assessor issued the New Tax Declarations (Annexes G, G-1 and G-2 of the Appeal dated 19 March 2004 [Annex ‘A’ hereof]), with the Tax Orders of Payment (Annexes H, H-1 and H-2 of the Appeal dated 19 March 2004 [Annex ‘A’ hereof]) covering the Subject Properties, the City Assessor was deemed to have made a reassessment thereof since new fair market values and assessed values were assigned to the Subject Properties thereby increasing the RPT due thereon. Under the above-quoted Section 226 of the LGC, it is clear that if the Petitioner-Appellant, being the owner of the Subject Properties, is not satisfied with said reassessment, it is entitled to ‘appeal to the Board of Assessment Appeals’.

“Further, on 16 January 2004, Petitioner-Appellant filed a protest of its payment of the RPT on the Subject Properties. (cf. Letter-Protest dated 15 January 2004, attached as Annex ‘F’ of the Appeal dated 19 March 2004 [Annex ‘A’ hereof]) Petitioner-Appellant made the said payment of RPT on 18 December 2003, which was intended for the entire year 2004 (cf. Official Receipt Nos. 5490499, 5490497 and 5490495, attached as Annexes C, C-1 and C-2 of the Appeal dated 19 March 2004 [Annex ‘A’ hereof]) On 05 February 2004, Petitioner-Appellant received a letter dated 27 January 2004 from the City Assessor denying its protest. (cf. Annex ‘I’ of the Appeal dated 19 March 2004 [Annex ‘A’ hereof]) Under Section 252 (d) of the LGC, Petitioner-Appellant is entitled to appeal the denial by the City Assessor of its protest with the Honorable LBAA.

“By thus filing its Appeal dated 19 March 2004, the Petitioner-Appellant merely exercised the remedies available to it under the law as a real property owner and taxpayer who is not satisfied with the actions of the City Assessor. Petitioner-Appellant is simply cognizant of the fact that its failure to appeal within the statutory period would render the questioned reassessment final and unappealable. [Victorias Milling Co. vs. Court of Tax Appeals, 22 SCRA 1008 (1968)

“It is clear from the foregoing facts that the issues that need to be resolved by the Appellee are whether or not the City Assessor is justified in issuing the New Tax Declarations and increasing the market values and assessed values of the Subject Properties; whether or not the City Assessor is justified in her reassessment of the Subject Properties; whether or not the City Assessor validly imposed alleged deficiency RPT for 2004 on the Subject Properties; and whether or not the City Assessor validly denied the protest filed by the Petitioner-Appellant. Contrary to the allegations of the City Assessor, the resolution of the foregoing issues will not depend on the resolution of the issue of the legality or constitutionality of Ordinance 03-06. The Appellee, pursuant to its authority under the LGC, is thus the proper body having jurisdiction to decide the foregoing issues raised in the Appeal dated 19 March 2004.

“II. Notwithstanding The Issue On The Appellee’s Alleged Lack Of Jurisdiction, The Appellee Erred In Not Ruling That The Assessment By The City Assessor of Alleged Deficiency RPT for 2004 on the Subject Properties have no basis since the RPT due thereon for the year 2004 have been fully paid.

“Notwithstanding the foregoing issue on its alleged lack of jurisdiction, the Appellee failed to rule upon the other substantive issues raised by the Petitioner-Appellant in its Appeal dated 19 March 2004 which are clearly within Appellee’s competence and jurisdiction to correct.

“The Appellee gravely erred, among others, in failing to declare that Petitioner-Appellant no longer has outstanding and unpaid RPT for the year 2004, as Petitioner-Appellant tendered full payment to the City Treasurer on 18 December 2003, pursuant to the provisions of Ordinance No. 02-17. The full payment of the RPT for 2004 is evidenced by Official Receipt Nos. 5490499, 5490497 and 5490495, which were stamped “Full 2004: by the City Treasurer. Copies of the said Official Receipts are attached as Annexes ‘O’, ‘O-1’ and ‘O-2’ of the Appeal dated 19 March 2004 (Annex ‘A’ hereof).

“Further, in recognition of the full payment tendered by Petitioner-Appellant, the City Treasurer even granted Petitioner-Appellant a discount of twenty percent (20%) for having paid the RPT on the Subject Properties for the entire year 2004 before 24 December 2003 in accordance with Ordinance 02-17. Having acknowledged without qualification that Petitioner-Appellant settled the RPT in full on the Subject Properties for the entire year 2004, there is no longer any basis to require Petitioner-Appellant to pay alleged deficiency taxes for 2004.

“III. Notwithstanding the issue on the Appellee’s alleged lack of jurisdiction, the Appellee erred in not ruling that Petitioner-Appellant has valid ground to request for reappraisal or reassessment of the Subject Properties considering that:

“A. The Subject Properties Are In Reality, Raw and Undeveloped Parcels (sic) Land, Without Any Improvements; And

“Petitioner-Appellant protested its payment of RPT for the year 2004, which were computed based on the current assessed value of the Subject Properties as appearing in the New Tax Declarations since the said assessed values are clearly excessive.

“An ocular inspection of the Subject Properties will show that the same remain and are undeniably raw and undeveloped land, with no improvements or infrastructures existing thereon. The Subject Properties are not presently in commercial use nor are they income-generating.

“The City Assessor, in its letter dated 21 January 2005 adopting its arguments in its Comment/Opposition, merely stated that the Subject Properties ‘can not be considered undeveloped, low or sunken that are usually flooded because there is nothing more to be done in the area except for buildings and other improvements to be constructed.’ Petitioner-Appellant cannot fathom how this description can already justify the classification of the Subject Properties as developed lands.

“It bears emphasis that the term ‘raw land’ has already been defined in Local Finance Circular No. 01-97 dated 16 April 1997, to wit:

‘(c) ‘Raw lands’ – refer to lands already classified in accordance with the classification of lands under Title Two, Book II, of R.A. No. 7160 but which are undeveloped or do not contain the necessary physical infrastructure for viable urban habitation, such as roads, water supply, sewerage, etc., which are covered by contract or agreement for development, partition and sale as a socialized housing; x x x.’ [Emphasis supplied]

“Corollarily, the Supreme Court has defined that word ‘improvement’ to mean ‘artificial alterations of the physical condition of the ground that are reasonably permanent in character’ and which ‘enhance both the values and utility’ of the land on which it is constructed. (Benguet Corporation vs. Central Board of Assessment Appeals, 218 SCRA 271, 278) None of such artificial alterations exist on the Subject Properties and the value and utility of the Subject Properties could not have been enhanced from the time the Petitioner-Appellant acquired the same, or even from the time of its reclamation. The City Assessor does not deny that buildings and other improvements have yet to be constructed on the Subject Properties. This has remained to be so up to the date hereof. Clearly, the Subject Properties fall under the sphere of ‘raw or undeveloped land’.

“Section 14 of Parañaque City Ordinance No. 96-16 provides that undeveloped parcels of land have a base value of seventy percent (70%) of the base value of the developed or improved lots in the area. According to the City Assessor, in her letter dated 21 January 2005, fully developed lots in the vicinity of the Subject Properties (whether in Barangay Tambo or Barangay Baclaran) have a value of Twelve Thousand Pesos (P12,000.00) per square meter, based on Parañaque City Ordinance No. 96-16. Considering that the Subject Properties are undeveloped, the base value or market value of the Subject Properties should only be at most seventy percent (70%) of Twelve Thousand Pesos (P12,000.00) per square meter, or Eight Thousand Four Hundred Pesos (P8,400.00) per square meter. Under Section 218 of the LGC, the maximum assessed value of commercial lands is fifty percent (50%) of the fair market value thereof as fixed by ordinance. Following this, the assessed value of the Subject Properties for real property tax purposes should only be fifty percent (50%) of Eight Thousand Four Hundred Pesos (P8,400.00) per square meter or only Four Thousand Two Hundred Pesos (P4,200.00) per square meter. The RPT paid by Petitioner-Appellant on the Subject Properties are based on an assessed value of Six Thousand Pesos (P6,000.00) per square meter as appearing in the New Tax Declarations. Since Petitioner-Appellant paid RPT on the Subject Properties on the basis of an assessed value which is higher than what the correct assessed value should be, the amount of RPT paid by Petitioner-Appellant on the Subject Properties are therefore clearly in excess of what it is supposed to pay under prevailing laws and ordinances.

“Moreover, it is to be noted that more developed areas contiguous in location to the Subject Properties and which are actually used in business and from which their owners derive income, like, as Petitioner-Appellant understands, the land where the Uniwide Coastal Mall is located, have a market and assessed value lower than that of the Subject Properties for purposes of real property taxation. There is undeniably a considerable difference between the development of said parcel of land and the current physical state of the Subject Properties. Hence, it is but fair and equitable that the market value of the Subject Properties for real property tax purposes be reduced accordingly.

“B. The Increase In The Market And Assessed Values Of Petitioner-Appellant’s Parcels Of Land Was Primarily Due To The Implementation Of An Ordinance That Clearly Did Not Comply With The Mandatory Requirements Of The 1987 Constitution And Of The LGC.

“Furthermore, the reassessment of the Subject Properties, which caused the increase in the market and assessed values thereof, was pursuant to the implementation of Ordinance 03-06. In the letter dated 27 January 2004 (cf. Annex ‘I’ of the Appeal dated 19 March 2004 [Annex ‘A’ hereof]), the City Assessor stated that ‘the change in Barangay location from Barangay Tambo to Barangay Baclaran is in compliance with Parañaque City Ordinance 03-06 series of 2003. x x x’ The said ordinance is entitled ‘An Ordinance Adopting a Straight Line Policy in the Determination of Barangay Boundaries in the Reclaimed Areas in Manila Bay Within the Territorial Jurisdiction of the City of Parañaque.’

“Section 10, Article X of the 1987 Constitution and Section 385 of the LGC are both clear that the alteration of the boundaries of a local government unit, including a barangay, is subject to the approval by a majority of the votes cast in a plebiscite in the affected barangays. The City Assessor, in the Comment/Opposition, argued that the foregoing requirement of approval by plebiscite stated in the 1987 Constitution and the LGC is not applicable to Ordinance 03-06 and stated as follows:

‘Contrary to allegations in the Appeal, in this case there is no creation of new barangay. The ordinance is not premised on population; there is no reduction of the population of the original barangay or barangays to less than the minimum requirement prescribed. There is neither reduction of the original area of the affected barangays, nor any alteration of their original boundaries. Notably there is extension of boundary lines, but only to determine tax jurisdiction and tax sharing in the reclaimed areas, without which delineation there will be conflict in jurisdiction both political and taxation. Furthermore, there is no existing law or ordinance that defines the political location of the reclaimed areas in Manila Bay.’ (Underscoring supplied; at p. 5)

“The arguments of the City Assessor find no support in the above-mentioned provisions of the 1987 Constitution and the LGC. Said provisions are clear that they will not apply only in cases where a new barangay is created. Said provisions apply whenever a barangay is divided, merged, abolished or when its boundaries are substantially altered as in the case of what Ordinance 03-06 intended to achieve. In implementing said ordinance, there will be a need to change boundaries of affected barangays of Parañaque having jurisdiction over the reclaimed areas in Manila Bay not only for taxation purposes, but also for political purposes, as it will be absurd if the Subject Properties will belong to Barangay Baclaran for taxation purposes, but will fall within Barangay Tambo for political purposes. This will necessarily result in a change in the area of said barangays.

“In the case of Miranda vs. Aguirre, 314 SCRA 603, 611 (1999), the Supreme Court discussed the rationale for the requirement of an approval by plebiscite of the creation, division, merger, abolition or alteration of boundaries of local government units, to wit:

‘x x x A close analysis of the said constitutional provision will reveal that the creation, division, merger, abolition or substantial alteration of boundaries of local government units involve a common denominator – material change in the political and economic rights of the local government units directly affected as well as the people therein. It is precisely for this reason that the Constitution requires the approval of the people ‘in the political units directly affected’. It is not difficult to appreciate the rationale of this constitutional requirement. The 1987 Constitution, more that (sic) any of our previous Constitutions, gave more reality to the sovereignty of our people for it was borne out of the people power in the 1986 EDSA revolution. Its Section 10, Article X addressed the undesirable practice in the past whereby local government units were created, abolished, merged or divided on the basis of the vagaries of politics and not of the welfare of the people. Thus, the consent of the people of the local government unit directly affected was required to serve as a checking mechanism to any exercise of legislative power creating, dividing, abolishing, merging or altering the boundaries of local government units. It is one instance where the people in their sovereign capacity decide on a matter that affects them – direct democracy of the people as opposed to democracy thru people’s representatives. This plebiscite requirement is also in accord with the philosophy of the Constitution granting more autonomy to local government units. x x x’ (Emphasis supplied)

“In the present case, the political and economic rights of Barangays Tambo and Baclaran will be affected. The right to share in any revenue which the Parañaque City Government stands to earn from the Subject Properties will necessarily be transferred from Barangay Tambo to Barangay Baclaran in view of the change in the boundaries thereof pursuant to Ordinance 03-06.

“Hence, before the boundaries of the affected barangays are altered, it is indispensable that the said alteration be approved by a majority of the votes cast in a plebiscite held in the affected barangays. The Supreme Court has consistently held that the need to consult with the constituents through the holding of a plebiscite among the affected local government units cannot be dispensed with. [cf. Tan vs. Comelec, 142 SCRA 727 (11 July 1986) Padilla vs. Comelec, 214 SCRA 735 (19 October 1992); and Griño vs. Comelec, 213 SCRA 672 (04 September 1992)]

“Contrary to the contentions of the City Assessor, Ordinance 03-06 could not be validly implemented even if it was approved by the Parañaque City Council, since said approval alone is insufficient in the absence of an actual plebiscite where the constituents of Barangays Tambo and Baclaran approved the same, which is required not only by law but by the Philippine Constitution itself.

“It is to be noted that the Sangguniang Barangay of Barangay Tambo, in its Resolution No. 11, Series of 2004, has withdrawn or recalled its Resolution No. 05, Series of 2003 where it expressed approval to the ordinance which adopted the straight-line policy in determining barangay boundaries in the reclaimed areas in Manila Bay within the territorial jurisdiction of the City of Parañaque. The Sangguniang Barangay of Barangay Tambo has formally informed all the pertinent officials of the City of Parañaque about this. A copy of the letter dated 28 September 2004 from the Tambo Barangay Council addressed to Parañaque City Mayor Florencio M. Bernabe, Jr. and a copy of Resolution No. 11, Series of 2004 of the Sangguniang Barangay of Barangay Tambo are attached herewith as Annexes ‘E’ and ‘F’.

“Finally, it should be underscored that Ordinance 03-06 merely states that ‘The territorial boundaries of the different barangays in the reclaimed areas in Manila Bay shall be determined by using the straight line method’. The Sangguniang Panlungsod did not specifically define the new territorial boundaries of Barangays Tambo and Baclaran in Ordinance 03-06. Instead, it delegated responsibility of defining the new territorial boundaries as well as the implementation of the Ordinance to the City Assessor. This delegation of authority by the Sangguniang Panlungsod to the City Assessor to alter the boundaries of the two Barangays is ultra vires, inasmuch as the power to alter the boundaries of LGUs, particularly barangays, is vested in the sangguniang panlalawigan or panlungsod of the barangays concerned. [cf. Section 6, LGC] This power to create new LGUs cannot be relinquished by the concerned sanggunain. [cf. Pirovano vs. De la Rama Steamship Co., 96 Phil 360]

“Thus, the implementation of Ordinance 03-06 is invalid and unconstitutional since it has not yet been approved in a plebiscite, contrary to the clear and unequivocal requirement under the 1987 Constitution and the LGC. Any and all issuances emanating therefrom including the New Tax Declarations which substantially increased the market and assessed values of the Subject Properties are null and void and cannot have any legal effect whatsoever.

“Thus, Petitioner-Appellant cannot be assessed for deficiency taxes for 2004 inasmuch as there is no legal ground to justify the revision of the schedule of values for the Subject Properties. Moreover, Petitioner-Appellant is entitled to a reduction in the market and assessed values of the Subject Properties inasmuch as they remain raw and undeveloped.

“IV. Notwithstanding The Issue On The Appellee’s Alleged Lack Of Jurisdiction And Assuming Arguendo That The New Tax Declarations Issued Covering The Subject Properties Are Valid, The Appellee Erred In Not Ruling That The Same Cannot Be Made Effective In 2004.”

“Assuming without conceding that the New Tax Declarations were validly issued pursuant to Ordinance 03-06, the resulting assessment and/or reassessment cannot be implemented on the Subject Properties beginning 01 January 2004. Section 221 of the LGC states as follows:

‘SEC. 221. Date of Effectivity of Assessment or Reassessment. – All assessments or reassessments made after the first (1st) day of January of any year shall take effect on the first (1st) day of January of the succeeding year: Provided, however, That the reassessment of real property due to its partial or total destruction, or to a major change in its actual use, or to any great and sudden inflation or deflation of real property values, or to the gross illegality of the assessment when made or to any other abnormal cause, shall be made within ninety (90) days from the date any such cause or causes occurred, and shall take effect at the beginning of the quarter next following the reassessment.’

“The Supreme Court, in the case of Callanta vs. Office of the Ombudsman, 285 SCRA 648, 664-665 (1998), made the following statement:

‘The general revision of property values was commenced by the city assessor of Cebu in 1988. Subsequently, the notices of the new assessments and the new tax declarations were sent to the property owners. The nature of an assessment has been explained this wise:

‘An assessment fixes and determines the tax liability of a taxpayer. As soon as it is served, an obligation arises on the part of the taxpayer concerned to pay the amount assessed and demanded.’

‘In the same vein, we have said that ‘the assessment is deemed made when the notice to this effect is released, mailed or sent to the taxpayer for the purpose of giving effect to said assessment.’ (Emphasis and underscoring supplied)

“It is to be emphasized that Petitioner-Appellant received on 20 January 2004 by registered mail the New Tax Declarations and the Tax Orders of Payment (cf. Annexes H, H-1 and H-2 of the Appeal dated 19 March 2004 [Annex ‘A’ hereof]) which contained the notices of assessment. The envelope bearing the foregoing documents contained a stamp made by the Parañaque Municipal Post Office of the word ‘REGISTERED’ and the date ‘14 January 2004’. (A photocopy of the envelope bearing the aforementioned stamp is attached as Annex ‘A’ of the Reply to Comment/Opposition to Appeal dated 22 October 2004 [Annex ‘B’ hereof]) This stamp shows that the New Tax Declarations for the Subject Properties were mailed or sent to the Petitioner-Appellant only on 14 January 2004, or well after the first day of January 2004. Following the Supreme Court ruling in the above-cited case, the reassessment made by the City Assessor of the Subject Properties is deemed to have been made only on 14 January 2004, even if the City Assessor purportedly issued the New Tax Declarations on 11 December 2003.

“It is clear, therefore, that the reassessment of the Subject Properties was made after the first day of January 2004 and thus, in accordance with Section 221 of the LGC and assuming that the reassessment and the New Tax Declarations issued are valid, the same should only take effect on the first day of January 2005.

“Further, it cannot be overemphasized that Petitioner-Appellant paid the RPT due thereon in full on 18 December 2003. Moreover, it cannot be denied that the City Treasurer acknowledged the same as full payment and even annotated on the official receipts with the phrase ‘Full 2004’. (cf. Annexes ‘O’, ‘O-1’ and ‘O-2’ the Appeal dated 19 March 2004 [Annex ‘A’ hereof]) In recognition of the full payment by the Petitioner-Appellant, the City Treasurer even granted Petitioner-Appellant a discount of twenty percent (20%) for having fully paid the entire RPT for 2004 on the Subject Properties prior to 24 December 2003, in accordance with Parañaque City Ordinance No. 02-17.

“Thus, there is no longer any basis for the City Assessor to have assessed Petitioner-Appellant with deficiency RPT for 2004 on the Subject Properties and Petitioner-Appellant is entitled to a refund of the amounts it overpaid to the City of Parañaque.

“PRAYER

“WHEREFORE, it is respectfully prayed that after hearing, an Order be issued reversing the Appellee’s Resolution dated 08 January 2005 stating as follows:

1. Declaring as null and void the New Tax Declarations issued by the City Assessor covering the Subject Properties;

2. Declaring as null and void the new RPT Orders of Payment issued by the City Treasurer pursuant to the New Tax Declarations issued by the City Assessor on the Subject Properties;

3. Directing the City Assessor of Parañaque to issue new tax declarations for the Subject Properties indicating that said properties are within the jurisdiction of Barangay Tambo and/or reducing the market and assessed values thereof, for purposes of computing real property taxes, for being raw and undeveloped land;

4. Declaring the Appellee as the proper forum to resolve the aforementioned issues; and

5. Declaring that the Petitioner-Appellant is entitled to a refund of all RPT paid to the extent that is excessive under existing laws and ordinances, including but not limited to the alleged deficiency RPT on the Subject Properties for 2004.”

RESPONDENT-APPELLEE’S COMMENT/ANSWER

In her Comment dated 26 March 2005 and received by this Board on March 28, 2005, Respondent-Appellee City Assessor of Parañaque, through the City Legal Officer, stated:

“This case arose from the alleged Municipal Ordinance No. 96-16 entitled ‘An Ordinance Prescribing the Schedule of Fair Market Values for Land Improvement for 1997 in this Municipality in Accordance with the Local Government Code of 1991” which adopted the revised schedule of fair market values for lands located in Parañaque as a result of the general revision conducted by the Parañaque Municipal Assessor on real property. Effectivity of the said ordinance was implemented in 1998.

“Secondly, petitioner in the case at bar questioned City Ordinance No. 03-06 entitled ‘An Ordinance Adopting a Straight Line Policy in the Determination of the Barangay Boundaries in the Reclaimed Areas in Manila Bay within the Territorial jurisdiction of the City of Parañaque’.

“Petitioner filed an appeal with the Local Board of Assessment Appeals which eventually denied the appeal on the ground that there was no appeal made pursuant to Section 226 of the R.A. 7160 within the sixty (60) day period. Further, a Resolution dated 08 January 2005 was also issued denying the same on the ground that the issues raised as to the legality and constitutionality of the questioned ordinance must be resolved in the proper forum.

“ISSUE

“WHETHER OR NOT THE APPEAL WAS FILED OUT OF TIME OR OTHERWISE BARRED BY PRESCRIPTION.

“ARGUMENTS

“At the outset, it is respectfully stressed that the assessments herein involved comprehended in Tax Declarations Nos. E-015-06816, E-015-06817 and E-015-06822 which has been issued as of November 2000, the petitioner in fact and belatedly contesting the said assessments. It is noteworthy to stress that no appeals were made by petitioner within sixty (60) days from the date of receipt of the written notice of assessment, as provided under Section 226, R.A. 7160 (otherwise known as the Local Government Code of 1991), which provides as –

‘Sec. 226. Any owner of person having legal interest in the property who is not satisfied with the action of the provincial, city or municipal assessor in the assessment of his property may, within sixty (60) days from the date of receipt of the written notice of assessment, appeal to the Board of Assessment Appeals of the Province or City by filing a petition under oath in the form prescribed for the purpose, together with copies of the tax declaration and such affidavits or documents submitted in support of the appeal.’

Furthermore, petitioner’s acknowledgment of and acquiescence to such tax declarations and assessments is evident in their payment of the corresponding real estate taxes based on said tax declarations and assessments therein, and “without protest”, as per certification of the respondent City Treasurer.

“II

“The applicable provisions of the Local Government Code guided the action of the respondent City Treasurer with respect to petitioner’s claim for tax credit and pursuant to Section 195, which among others stated that –

‘Section 195. Protest of Assessment – When the local treasurer or his duly authorized representative finds that correct taxes, fees or charges have not been paid, he shall issue a notice of assessment stating the nature of the tax, fee or charge, the amount of deficiency, the surcharges, interest and penalties. Within sixty (60) days from (sic) receipt of the notice of assessment, the taxpayer may file a written protest with the local treasurer contesting the assessment, otherwise; the assessment shall become final and executory. The local treasurer shall decide the protest within sixty (60) days from the time of its filing. If the local treasurer finds the protest to be wholly or partly meritorious, he shall issue a notice canceling wholly or partly (sic) the assessment. However, if the local city (sic) treasurer finds the assessment to be wholly or partly correct, he shall deny the protest wholly or partly with notice to (sic) taxpayer. The taxpayer shall have thirty (30) days from the receipt of the denial of the protest or from the lapse of the sixty (60) day period prescribed herein within which to appeal with the court of competent jurisdiction otherwise the assessment becomes conclusive and unappealable.’

and that, thus, the letter dated 27 January 2004 comprehended the denial of petitioner’s protest of the notice of tax delinquencies, and petitioner had failed to appeal the same with the court of competent jurisdiction within thirty (30) days from the receipt of the denial’ or even assuming arguendo that petitioner’s letter-request may be deemed as properly a written protest seasonably filed conformably with the above-cited law, still petitioner had failed to appeal the “Final Notices” with the court of competent jurisdiction from the lapse of sixty (60) day period prescribed by law for the Respondent City Treasurer to decide on the protest, such that in any event the assessments became final and unappealable, and justifies and validates the subsequent action of the respondent City Treasurer with respect to the auction sale of properties due to non-payment of ral property taxes.

“III

“With respect to the petitioner’s claim for application of the alleged overpayment for the previous years to be applied to the past but unpaid and current realty taxes, no appeal was made by the petitioner to the Local Board of Assessment Appeals and/or the Central Board of Assessment Appeals within the period prescribed with respect to taxpayer’s remedy under the law, to wit, Secs. 226 and 229 in relation to Sec. 252, Local Government Code (R.A. 7160), as follows:

‘Sec. 252. Payment under Protest. – (a) No protest shall be entertained unless the taxpayer first pays the tax. There shall be annotated on the tax receipts the words ‘paid under protest’. The protest in writing must be filed within thirty (30) days from payment of the tax to the provincial, city treasurer or municipal treasurer, in the case of (sic) municipality within Metropolitan Manila Area, who shall decide the protest within sixty (60) days from receipt.

(b) The tax or a portion thereon (sic) paid under protest, shall be held in trust by the treasurer concerned.

(c) In the event that the protest is finally decided in favor of the taxpayer, the amount or portion of the tax protested shall be refunded to the protestant, or applied as tax credit against his existing or future tax liability;

(d) In the event that the protest is denied or upon the lapse of the sixty-day period prescribed in subparagraph (a), the taxpayer may avail of the remedies as provided for in Chapter 3, Title Ii, Book (sic) of this Code.’ (underlining ours).

“Anent the Local Government Code, it further provides in Chapter 3, Title II, Book II thereto(sic) , to wit:

‘Sec. 226. Any owner or person having legal interest in the property who is not satisfied with the action of the provincial, city or municipal assessor in the assessment of his property may, within sixty (60) days from the date of receipt of the written notice of assessment, appeal to the Board of Assessment Appeals of the Province or City by filing a petition under oath in the form prescribed for the purpose, together with the (sic) copies of the tax declaration (sic) and such affidavits or documents submitted in support of the appeal.’

‘Sec. 229. Action by the Local Board of Assessment Appeals –The Board shall decide the appeal within one hundred twenty (120) days from the date of receipt of such appeal. The Board, after hearings (sic), shall render its decision based on substantial evidence or such relevant evidence on record as a reasonable mind might accept as adequate to support the conclusion.

(b) x x x x x x x x x

(c) x x x x x. The owner of the property or the person having legal interest in the property (sic) who is not satisfied with the decision of the Board, may, within thirty (30) days after receipt of the decision of the said Board, appeal to the Central Board of Assessment Appeals, as herein provided. The decision of the Central Board shall be final and executory.’

IV

“Furthermore, with the foregoing provisions of the law, the petitioner’s cause of action is barred by prescription. Petitioner’s long inaction and passivity in asserting one’s rights precludes him from recovering anything, thus –

‘Laches is negligence or omission to assert a right within a reasonable time, warranting the presumption that the party entitled to assert it has either abandoned or declined to assert it” (Villanueva-Mijares vs. Court of Appeals, 330 SCRA 349).

and,

‘Relief is denied to a claimant whose right has become ‘stale’ by reason of negligence or inattention for a long period of time’ (Santiago vs. Court of Appeals, 334 SCRA 454).

“In fine, petitioner’s long inaction has barred them (sic) to assert any right, if any, against the herein respondents.

“P R A Y E R

“WHEREFORE, it is respectfully prayed that due to petitioner’s failure to avail of the remedies given to them (sic) by law, petitioner are already barred by prescription or laches. . .”

In its Reply dated 9 May 2005 and received by this Board on the same date, Petitioner-Appellant discussed matters which were substantially treated by the same Petitioner-Appellant in its appeal to this Board.

CBAA’S FINDINGS/RULING

APPELLANT’S “ARGUMENT” I
CONTRARY TO ITS RESOLUTION DATED 08 JANUARY 2005, THE APPELLEE ERRED IN STATING THAT IT HAS NO JURISDICTION IN AN APPEAL FROM A WRITTEN NOTICE OF ASSESSMENT ISSUED BY THE CITY ASSESSOR AND FROM THE DENIAL BY THE SAID CITY ASSESSOR OF PETITIONER-APPELLANT’S PROTEST FROM ITS PAYMENT OF RPT, IN ACCORDANCE WITH SECTIONS 226 AND 252(D) OF THE LGC.

First and foremost, we have to reconcile the conflicting statements made by both parties hereto.
In its first “argument” (read “issue”) shown above, Petitioner-Appellant said that “the Appellee erred in stating that it has no jurisdiction in an appeal from a written notice of assessment issued by the City Assessor and from the denial of the said City Assessor of Petitioner-Appellant’s protest from its payment of RPT, in accordance with Sections 226 and 252(d) of the LGC. On the other hand, Respondent City Assessor alleged in her Comment that “Petitioner filed an appeal with the Local Board of Assessment Appeals which eventually denied the appeal on the ground that there was no appeal made pursuant to Section 226 of R.A. 7160 within the sixty (60) day period.”

Both statements are, of course, incorrect. The truth of the matter is that the LBAA dismissed Petitioner’s Appeal on the ground that the issue of the constitutionality or validity of Parañaque City Ordinance No. 03-06, Series of 2003, “must be resolved in the proper forum”.

In its said Appeal, dated 19 March 2004, Petitioner-Appellant argued that the assessments made by Respondent City Assessor pursuant to Ordinance 03-06 of the City of Parañaque, the tax declarations and the notices of assessment issued in connection therewith were all invalid for the reason that said Ordinance 03-06 contravened Section 10, Article X of the Constitution and did not satisfy the requirements of Sections 10 and 385 of the Local Government Code of 1991.

Section 10, Article X of the 1987 Constitution mandates as follows:

“SEC. 10. No province, city, municipality, or barangay may be created, divided, merged, abolished, or it boundary substantially altered, except in accordance with the criteria established in the local government code and subject to approval by a majority of the votes cast in a plebiscite in the political units directly affected.”

Sections 10 and 385 of the Local Government Code of 1991 provide, thus:

“SEC. 10. Plebiscite Requirement. – No creation, division, merger, abolition, or substantial alteration of boundaries of local government units shall take effect unless approved by a majority of the votes cast in a plebiscite called for the purpose in the political unit or units directly affected. Said plebiscite shall be conducted by the Commission on Elections (Comelec) within one hundred twenty (120) days from the date of effectivity of the law or ordinance effecting such action, unless said law or ordinance fixes another date.”

“SEC. 385. Manner of Creation. – A barangay may be created, divided, merged, abolished, or its boundaries substantially altered, by law or by an ordinance of the sangguniang panlalawigan or sangguniang panlungsod, subject to approval by a majority of the votes cast in a plebiscite to be conducted by the Comelec in the local government unit or units directly affected within such period of time as may be determined by the law or ordinance creating said barangay. In the case of the creation of barangays by the sangguniang panlalawigan, the recommendation of the sangguniang bayan concerned shall be necessary.”

And so, in its Resolution dated 08 January 2005, the Local Board of Parañaque, somewhat hastily, concluded, thus:

“The issues raised by the Appellant boils (sic) down to the constitutionality of City Ordinance No. 03-06, which is outside the jurisdiction of this Board. Article 275 of the Rules and Regulations Implementing The Local Government Code of 1991 provides as follows:

Article 275. PROCEDURE FOR APPROVAL AND EFFECTIVITY OF TAX ORDINANCE AND REVENUE MEASURES.

The procedures for approval of local tax ordinances and revenue measures shall be in accordance with the provision of this Rule provided that public hearings shall be conducted for the purpose prior to the enactment thereof provided further that any question on the constitutionality or legality of tax ordinances or revenue measures may be raised on appeal within thirty (30) days from the effectivity thereof to the Secretary of Justice who shall render a decision within sixty (60) days from the date of receipt of the appeal provided furthermore that such appeal shall not have the effect of suspending the effectivity of the ordinance and (sic) accrual and payment of the tax, fee, or charged (sic) levied therein and provided finally that within thirty (30) days after receipt of the decision or the lapse of the sixty-day period without the Secretary of Justice acting upon the appeal, the aggrieved party may file appropriate procedures (sic) with a court of competent jurisdiction. . . . .

Therefore, since the issues raised by Appellant are anchored as to whether or not Parañaque City Ordinance No. 03-06, Series of 2003 is valid and/or constitutional, settlement of such question must be resolved in the proper forum, which will in turn answer all attendant questions.

The instant appeal is hereby DENIED.”

Article 275 of the Implementing Rules and Regulations (IRR) of the Local Government Code of 1991, quoted above, is a virtual reproduction of Section 187 of the LGC of 1991, which said Article 275 implemented. In fact, Article 275 of the IRR and Section 187 of the LGC have identical subtitles.

In her Comments dated 26 March 2005, Respondent City Assessor said:

“The applicable provisions of the Local Government Code guided the action of the respondent City Treasurer with respect to petitioner’s claim for tax credit and pursuant to Section 195, which among others stated that –

‘Section 195. Protest of Assessment – When the local treasurer or his duly authorized representative finds that correct taxes, fees or charges have not been paid, he shall issue a notice of assessment stating the nature of the tax, fee or charge, the amount of deficiency, the surcharges, interest and penalties. Within sixty (60) days from (sic) receipt of the notice of assessment, the taxpayer may file a written protest with the local treasurer contesting the assessment; otherwise; the assessment shall become final and executory. The local treasurer shall decide the protest within sixty (60) days from the time of its filing. If the local treasurer finds the protest to be wholly or partly (sic) meritorious, he shall issue a notice canceling wholly or partly the assessment. However, if the local city (sic) treasurer finds the assessment to be wholly or partly correct, he shall deny the protest wholly or partly with notice to taxpayer. The taxpayer shall have thirty (30) days from the receipt of the denial of the protest or from the lapse of the sixty (60) day period prescribed herein within which to appeal with the court of competent jurisdiction otherwise the assessment becomes conclusive and unappealable.’

The quotations/discussions made on Article 275 of the IRR (which implemented Section 187 of the LGC) by the LBAA and on Section 195 of the LGC by Respondent City Assessor are good, if only this case involved some local tax, fee or charge governed by the LGC provisions under Title One, Book II, of the Code. It is unfortunate that this case involves real property taxes which are governed by the provisions of the Code under its Title Two, Book II.

If one would carefully read the provisions of Book II of the Code, one would find that the provisions under Title One thereof are applicable only to “Local Government Taxation”, in the same way that the provisions under Title Two, also of Book II, are applicable only to “Real Property Taxation”. Title One and Title Two each has a complete set of provisions, separate and distinct from each other set. For instance, for Section 195 under “Local Government Taxation” (Title One), the equivalent or counterpart provision under “Real Property Taxation” (Title Two) is Section 226. For every aspect that matters to both Titles (One and Two) each has a provision of each own. Such that Title One does not need to import any provisions from Title Two, or vice versa.

Also, Respondent City Assessor, through the City Legal Officer, said that “The applicable provisions of the Local Government Code guided the action of the respondent City Treasurer with respect to the petitioner’s claim for tax credit and pursuant to Section 195, . . .” The records show that the letter dated 27 January 2004, in answer to Petitioner’s letter protest dated 15 January 2004, came from the respondent City Assessor herself, not from the City Treasurer. Likewise, we do not understand why Petitioner-Appellant discussed the provisions of Section 252 of the LGC. The records of this case do not disclose that a claim for tax refund or credit was filed by Petitioner-Appellant with the City Treasurer under the said section.

The Respondent’s denial of Petitioner-Appellant’s letter-protest dated 15 January 2004 which questioned the assessments made effective January 1, 2001 was not appealed on time. Besides which, only actions by an assessor in the assessment of real properties are appealable to the LBAA. A denial by an assessor of a protest over an assessment filed by a taxpayer with the assessor is not appealable anywhere.

Next we have to determine whether or not Petitioner-Appellant’s Appeal with the LBAA of Parañaque was filed in accordance with the provisions of Section 226 of R.A. 7160 and, for that matter, whether or not Petitioner-Appellant’s Appeal with this Board was filed in accordance with the provisions of Section 229(c) of the same Code. The provisions of Sections 226 and 229(c) of the Code are quoted hereunder, thus:

“SEC. 226. Local Board of Assessment Appeals. – Any owner or person having legal interest in the property who is not satisfied with the action of the provincial, city or municipal assessor in the assessment of his property may, within sixty (60) days from the date of receipt of the written notice of assessment, appeal to the Board of Assessment Appeals of the province or city by filing a petition under oath in the form prescribed for the purpose, together with copies of the tax declarations and such affidavits or documents submitted in support of the appeal.”

“SEC. 229. Action by the Local Board of Assessment Appeals. –

“x x x.

“(c) . . . The owner of the property or the person having legal interest therein or the assessor who is not satisfied with the decision of the Board may, within thirty (30) days after receipt of the decision of said Board, appeal to the Central Board of Assessment Appeals, as herein provided. . .”

In its Appeal to the LBAA dated March 19, 2004 and received by the LBAA on March 22, 2004 , Petitioner-Appellant stated that it was appealing the following:
1. The denial of its letter-protest dated 15 January 2004.
2. The issuance of the New Tax Declarations and the Tax Orders of Payment containing the notices of assessment both reflecting the new market and assessed values of the Subject Properties; and
3. The issuance of the New RPT Orders of Payment indicating alleged deficiency RPT for the calendar year 2004.

All three (3) items above are indicative of the Petitioner-Appellant’s dissatisfaction over the actions of the City Assessor in the assessments of the subject properties. They are, therefore, appropriate subject matters for appeals to the LBAA, However, Item No. 1 above, the letter-protest dated 15 January 2004, was sent to the Respondent Assessor after Petitioner-Appellant paid on 18 December 2003 the total amount of P2,890,282.50 − of which P688,162.50 was for the fourth quarter of 2003 and P2,202,120.00 for the year 2004 − but before Petitioner-Appellant received copies of the tax declarations and RPTOP for the assessments effective the year 2004. The amount of P2,202,120.00, supposedly as advance payment for calendar year 2004, was equal to the taxes due for one (1) year on the subject properties based on the assessments which took effect 01 January 2001. Petitioner-Appellant stated that it “has been religiously paying the real property taxes (“RPT”) due on the Subject Properties since the above-mentioned TCTs were issued in its name in 1999 ”.

Clearly, therefore, Petitioner-Appellant’s letter-protest of 15 January 2004 refers to the assessments on the subject properties which began in the year 2001. As such, Item No. 1, which actually questioned the 2001 assessments, although included in Petitioner-Appellant’s Appeal dated 19 March 2004, could not be considered as having been appealed to the LBAA within the period prescribed under Section 226 of R.A. 7160.

Item Nos. 2 and 3, above, both refer to the assessments on subject properties effective the calendar year 2004.

Respondent-Appellee City Assessor of Parañaque does not dispute Petitioner-Appellant’s allegation that the latter received copies of the tax declarations, along with copies of the corresponding RPTOP (which contained the printed, albeit unsigned “Notices of Assessment”), on 20 January 2004.

The sixtieth (60th) day after 20 January 2004 was 20 March 2004, which fell on a Saturday. The records show that the LBAA received the Appeal on the next working day, 22 March 2004. Therefore, granting that the unsigned copies of the said notices of assessments qualify as the “written notices of assessment” called for under Section 226 of R.A. 7160, the Petitioner-Appellant filed its appeal to or with the LBAA within the period prescribed under said Section 226 of R.A. 7160, insofar as Items 2 and 3, mentioned above, are concerned.

On the matter of the Appeal with this Board, Petitioner-Appellant alleged that its received a copy of the LBAA Resolution on 18 January 2005. The records show that this Board received Petitioner’s instant Appeal on February 17, 2005, the thirtieth (30th) day from the date Petitioner-Appellant received on 18 January 2005 a copy of the LBAA Resolution dated 08 January 2005. Needless to say, the instant Appeal was filed well within the thirty-day period prescribed under Section 229(c) of the Code.

Petitioner-Appellant’s “Arguments” II to III are as follows:
II
NOTWITHSTANDING THE ISSUE ON THE APPELLEE’S ALLEGED LACK OF JURISDICTION, THE APPELLEE ERRED IN NOT RULING THAT THE ASSESSMENT BY THE CITY ASSESSOR OR ALLEGED DEFICIENCY RPT FOR 2004 ON THE SUBJECT PROPERTIES HAS NO BASIS SINCE THE RPT DUE THEREON FOR THE YEAR 2004 HAVE BEEN FULLY PAID.

III

NOTWITHSTANDING THE ISSUE ON THE APPELLEE’S ALLEGED LACK OF JURISDICTION, THE APPELLEE ERRED IN NOT RULING THAT PETITIONER-APPELLANT HAS VALID GROUND TO REQUEST FOR REAPPRAISAL OR REASSESSMENT OF THE SUBJECT PROPERTIES CONSIDERING THAT:

A. THE SUBJECT PROPERTIES ARE IN REALITY, RAW AND UNDEVELOPED PARCELS OF LAND, WITHOUT ANY IMPROVEMENTS; AND

B. THE INCREASE IN THE MARKET AND ASSESSED VALUES OF PETITIONER-APPELLANT’S PARCELS OF LAND WAS PRIMARILY DUE TO THE IMPLEMENTATION OF AN ORDINANCE THAT CLEARLY DID NOT COMPLY WITH THE MANDATORY REQUIREMENTS OF THE 1987 CONSTITUTION AND OF THE LGC.

Since they are interrelated with one another, Appellant’s “Arguments” stated above are discussed jointly hereunder.

Ordinance No. 03-06 of the City of Parañaque is reproduced hereunder, thus:

“REPUBLIC OF THE PHILIPPINES
PARAÑAQUE CITY
METRO MANILA

OFFICE OF THE CITY COUNCIL

ORDINANCE NO. 03-06
SERIES OF 2003

PROPONENT: COUN. GENEROSO V. PUSON

AN ORDINANCE ADOPTING A STRAIGHT LINE POLICY IN THE DETERMINATION OF BARANGAY BOUNDARIES IN THE RECLAIMED AREAS IN MANILA BAY WITHIN THE TERRITORIAL JURISDICTION OF THE CITY OF PARAÑAQUE.

WHEREAS, the reclamation of Manila Bay within the territorial jurisdiction of the City of Parañaque has created conflicting claims among the different Barangays;

WHEREAS, last September 30, 1997, the Sangguniang Bayan approved Resolution No. 97-84, Series of 1997 entitled ‘A RESOLUTION URGING THE OFFICE OF THE MUNICIPAL MAYOR TO DIRECT THE MUNICIPAL ASSESSOR AND THE MUNICIPAL TREASURER TO ADOPT THE STRAIGHT LINE POLICY IN DETERMINING THE BOUNDARIES OF ALL BARANGAYS IN THE RECLAIMED AREAS AND SEGREGATING THE RECORD THEREOF’;

WHEREAS, last November 9, 2000, the Sangguniang Barangay of Baclaran passed and approved Barangay Resolution No. 25, Series of 2002 entitled: “A RESOLUTION REQUESTING THE HON. MAYOR JOEY P. MARQUEZ TO DIRECT THE CITY ASSESSOR SOLEDAD S. MEDINA CUE TO CORRECT AND TRANSFER THE TAX DECLARATION OF PROPERTIES AT ASEANA BUSINESS PARK FROM BARANGAY TAMBO TO BARANGAY BACLARAN”;

WHEREAS, the adoption of straight line policy is the most fair and practical way of settling the boundary disputes among the different barangays over the reclaimed areas in Manila Bay;

NOW THEREFORE, be it ordained, as it is hereby ordained by the Sangguniang Panglunsod in session assembled that:

SECTION I. The territorial boundaries of the different barangays in the reclaimed areas in Manila Bay shall be determined by using the straight line method.

SECTION II. In the adoption of straight line policy, boundaries should be set along easily identified existing natural or man made land divisions (river courses, road-ways, etc.) and should coincide with property lines.

SECTION III. The Office of the City Assessor is hereby directed to implement the provision of this ordinance.

SECTION IV. All resolutions and ordinances inconsistent with the provision of this ordinance is hereby repealed or modified accordingly.

SECTION V. This ordinance shall effect upon the required posting and publication has been complied with.

ENACTED this 11th day of February, 2003 at Parañaque City.”

The Local Board of Assessment Appeals of Parañaque City may not have competent jurisdiction over the issue of whether or not the above-quoted ordinance is unconstitutional or invalid but, certainly, it has jurisdiction over the acts or, more appropriately, the results of the acts done pursuant to said ordinance insofar as such acts, or the results thereof, affect real property taxation.

Section 220 of the Code, as implemented by Article 311 of the IRR, enumerates the only instances where an assessor may make a classification, appraisal or assessment of real property under his jurisdiction, thus:

“SEC. 220. Valuation of Real Property. – In cases where (a) real property is declared and listed for taxation purposes for the first time; (b) there is an ongoing general revision of property classification and assessment; or (c) a request is made by the person in whose name the property is declared, the provincial, city or municipal assessor or his duly authorized deputy shall, in accordance with the provisions of this Chapter, make a classification, appraisal and assessment of the real property listed and described in the declaration irrespective of any previous assessment or taxpayer’s valuation thereon: Provided, however, That the assessment of real property shall not be increased oftener than once every three (3) years except in case of new improvements substantially increasing the value of said property or of any change in its actual use.” (Emphasis supplied)

Assessing subject properties, purportedly pursuant to the provisions of Parañaque City’s Ordinance No. 03-06, Series of 2003, does not fall under any of the instances enumerated under Section 220.

Section III of said Ord. 03-06 directed the Office of the City Assessor to implement Section I and Section II of the same ordinance, thus:

“SECTION I. The territorial boundaries of the different barangays in the reclaimed areas in Manila Bay shall be determined by using the straight line method.

“SECTION II. In the adoption of straight line policy, boundaries should be set along easily identified existing natural or man made land divisions (river courses, road ways, etc.) and should coincide with property lines.

“SECTION III. The Office of the City Assessor is hereby directed to implement the provision of this ordinance.”

Without touching on the constitutionality or validity of said Ordinance No. 03-06, we find nothing therein which remotely authorized Respondent City Assessor to make the questioned assessments. Respondent’s authority to relocate the boundaries between Bgys. Tambo and Baclaran using the “straight line policy” do not automatically carry with it the authority to make the questioned assessments.

Respondent City Assessor states that the questioned reassessments were made due to “CHANGE OF BARANGAY LOCATION IN COMPLIANCE WITH PARAÑAQUE CITY ORDINANCE 03-06 SERIES OF 2003”. And we thought that a parcel of land does not move or could not be moved from one location to another, unless a major earthquake occurs and shakes up the earth’s formation. A parcel of land maybe eroded but its intact portion is fixed on the same location.

The name of the location of subject properties was changed, but not the location itself. We are certain that the technical descriptions (the degrees of deviations, the minutes and distances between points) of Lots 15, 16 and 19 remain the same even after the respondent reassessed the same lots.

A real property’s value does not automatically appreciate with the change of the name of the place where said real property is situated.

APPELLANT’S “ARGUMENT’ IV
NOTWITHSTANDING THE ISSUE ON THE APPELLEE’S ALLEGED LACK OF JURISDICTION AND ASSUMING ARGUENDO THAT THE NEW TAX DECLARATIONS ISSUED FOR THE SUBJECT PROPERTIES ARE VALID, THE APPELLEE ERRED IN NOT RULING THAT THE SAME CANNOT BE MADE EFFECTIVE IN 2004.”

Granting, for the sake of argument, that the questioned assessments are, for all intents and purposes, legal, their effectivity should be governed by the provisions of Section 221 of the LGC, as implemented by Article 312 of the IRR, thus:

“SEC. 221. Date of Effectivity of Assessment or Reassessment. – All assessments or reassessments made after the first (1st) day of January of any year shall take effect on the first (1st) day of January of the succeeding year: Provided, however, That the reassessment of real property due to its partial or total destruction, or to a major change in its actual use, or to any great and sudden inflation or deflation of real property values, or to the gross illegality of the assessment when made or to any abnormal cause, shall be made within ninety (90) days from the date any such cause or causes occurred, and shall take effect at the beginning of the quarter next following the reassessment.”

“ART. 312. Date of Effectivity of Assessment or Reassessment. – All assessments or reassessments made after the first (1st) day of January of any year shall take effect on the first (1st) day of January of the succeeding year provided, however, that the reassessment of real property due to its partial or total destruction, or to a major change in its actual use, or to any great and sudden inflation or deflation of real property values, or to the gross illegality of the assessment when made, or to any abnormal cause, shall be made within ninety (90) days from the date any such cause or causes occurred, and shall take effect at the beginning of the quarter next following the reassessment.”

The Supreme Court, in Callanta v. Office of the Ombudsman , ruled:

“In the same vein, we have said that ‘the assessment is deemed made when the notice to this effect is released, mailed or sent to the taxpayer for the purpose of giving effect to the said assessment’.” (As quoted in Cipriano P. Cabaluna, Jr., Real Property Taxation (Annotated), Revised Edition, pp. 170,171) (Emphasis supplied)

Respondent does not dispute Petitioner’s assertions that the former received copies of the unsigned notices of the questioned assessments only on 20 January 2004 and that said copies were contained in a mailing enveloped marked by the Parañaque Municipal Post Office with the word “REGISTERED” and the date “14 January 2004”. Based on the Supreme Court’s pronouncement in the Callanta case above-quoted, the questioned assessments were supposed to be completed on 14 January 2004 and effective on 20 January 2004. Therefore, if the questioned assessment were valid, they were supposed to take effect only on 01 January 2005, in accordance with the provisions of Section 221 of the Code.

In view of all the foregoing, We believe, and so hold, that the assessments made by Respondent City Assessor of Parañaque on the subject properties of Petitioner-Appellant, purportedly pursuant to the provisions of Ordinance No. 03-06, Series of 2003, of Parañaque City, are null and void for lack of legal basis.

WHEREFORE, judgment is hereby rendered:

A. DISMISSING and SETTING ASIDE the Resolution of the Local Board of Assessment Appeals of Parañaque City dated 08 January 2005; and

B. Declaring Tax Declaration Nos. E-002-07533, E-002-07534 and E-002-07537 issued by Respondent City Assessor for Petitioner-Appellant’s properties purportedly pursuant to Parañaque City Ordinance No. 03-06, Series of 2003, as NULL, VOID, and WITHOUT EFFECT from the very beginning.

SO ORDERED.

Manila, Philippines, August 3, 2012.

SIGNED
OFELIA A. MARQUEZ
Chairman

Abstained SIGNED
ROBERTO D. GEOTINA CAMILO L. MONTENEGRO
Member Member