Republic of the Philippines
CENTRAL BOARD OF ASSESSMENT APPEALS M a n I l a
MR. EDUARDO T. RODRIQUEZ, Petitioner-Appellant,
CBAA CASE NO. V-25 – versus –
THE CITY ASSESSOR OF LA CARLOTA CITY,
Respondent- Appellee,
– and –
THE LOCAL BOARD OF ASSESSMENT APPEALS OF LA CARLOTA CITY,
Appellee.
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R E S O L U T I O N
This Appeal, received by this Board in Manila on August 22, 2006, is from
the Order in an unnumbered case made by the Local Board of Assessment
Appeals of the City of La Carlota (the “Local Board”) on July 3, 2006, the
dispositive portion of which reads as follows:
“WHEREFORE, based on the foregoing provision of law and ruling of the Central Board of Assessment Appeals, this Honorable Board could not proceed with the hearing of petition unless the tax due is paid by the Petitioner.”
Alleging that he received a copy of the said Order on July 10, 2006,
Petitioner-Appellant submits the following:
“ISSUES TO BE RESOLVED:
“1. Whether or not the re-assessment on the subject property by the City Assessor of La Carlota City is illegal; and
“2. Whether of not payment under protest should be made a condition precedent for the existence of the right of herein Appellant to question the assessments made by the City Assessor of La Carlota before the Local Board of Assessment Appeals.”
This Board could not discuss the merits of the first issue since the Local
Board, in its Order appealed from, chose not to hear the petition before it.
On the second issue, Petitioner-Appellant argues that “since the assailed
assessments are illegal, the same are void and cannot attain finality. The Local
Reference: Book XIII, pp. 109-117
Government Code, particularly Sec. 226, chapter 3 on Assessment Appeals, or
its implementing rules and regulations do not provide as condition precedent the
payment of tax questioned before the Local Board of Assessment Appeals.”
On the other hand, the Local Board contends that, under the provisions of
Section 252 of RA 7160, otherwise known as the Local Government Code of
1991, the petitioner should first pay the tax due before the Local Board may hear
said petition. Section 252 provides 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 or municipal treasurer in the case of a municipality within the Metropolitan Manila Area, who shall decide the protest within sixty (60) days from receipt.
“x x x
“(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 the 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 paragraph (a), the taxpayer may avail of the remedies as provided for in Chapter 3, Title Two, Book II of this Code.”
Before an appeal to the Local Board under the provisions of Section 252 of
the Code may be lodged with the Local Board, the following conditions must
occur: First: That the taxpayer has paid the questioned tax; Second: That the
Official Receipt for such payment is marked with the words “paid under protest;
Third: That the taxpayer filed a protest in writing to the treasurer within thirty (30)
days from payment, and Fourth: That the treasurer denied, in writing, the claim
for tax credit of refund, or did not act on the claim within sixty (60) days after the
date the protest was filed.
The subject of an appeal to the Local Board under the provisions of
Section 252 would be the treasurer’s denial of, or inaction on, the appellant’s
claim for tax refund or credit. In this case, however, the Local Board of
Assessment Appeals of La Carlota City acted as the City Treasurer of La Carlota
City in refusing to hear the appeal, invoking as it does, Section 252 of RA 7160.
The two petitions, dated November 30, 2005 and March 9, 2006, filed by
Petitioner Eduardo T. Rodriquez with the Local Board clearly state that the
Reference: Book XIII, pp. 109-117
appeal to the Local Board is from the action of the assessor inn the assessment
on the petitioner’s poultry site. The provisions of the Code which is applicable in
this case is not Section 252, but Section 226, thus:
“Section 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 declaration and such affidavits or documents submitted in support of the appeal.” (Emphasis supplied)
The Local Board cited the case of Manila Electric Company vs. Provincial
Assessor of Batangas (CBAA Case No. 10, November 5, 1976) wherein this
Board, in a Resolution dated June 6, 1975, ruled that “Meralco should first pay
the taxes as assessed by the provincial assessor before this board may proceed
with the hearing of this case.” In the said case, this Board said in part:
“(a) the term ‘assessment’ is defined in Section 3 of PD 464 as ‘the act or process of determining the value of a property or properties subject to tax, including the discovery, listing and appraisal of properties’. Thus the action of the assessor in classifying the properties as real becomes subject to appeal under the cited provision of law (PD 76), and consequently subject to the requirement in the same provision that the appeal shall not suspend the collection of the corresponding real property taxes. The general principle alluded to by the appellant that the payment of the tax is a condition precedent to judicial relief does not apply to the present appeal as it is not a suit in court but merely part of an administrative process.”
Presidential Decree No. 76, referred to above, was promulgated on
December 6, 1973, Section 7, par. 3 of which reads as follows:
“The appeal, referring to appeals to the Provincial or City Board of Assessment Appeals and to the Central Board of Assessment Appeals, however, shall not suspend the collection of the corresponding realty taxes as assessed by the provincial or city assessor, without prejudice to subsequent adjustment depending upon the final outcome of the appeal.”
Presidential Decree No. 76 was repealed by PD 464, otherwise known as
the Real Property Tax Code, which was promulgated on May 20, 1974 and took
effect on June 1, 1974. Presidential Decree No. 464 was, of course, expressly
repealed by Republic Act No. 7160, otherwise known as the Local Government
Code of 1991 which took effect on January 1, 1992. The provisions of Sec. 7,
par. 3 of PD 76 are similar in substance to the provisions of Section 37 of PD
464, which, in turn, was reproduced in Section 231 of RA 7160, thus:
“SEC. 231. Effect of Appeal on the Payment of Real Property Tax. – Appeal on assessment of real property made under the provisions of this Code
Reference: Book XIII, pp. 109-117
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.”
Even if we assume that the Local Board, in its refusal to hear the appeal
before it, intended to invoke the provisions of Section 231, instead of 252, still,
the order of the Local Board would be wrong under the present law.
Note that Section 54 o CA 470, the law in force before PD 76, expressly
and specifically prohibits any court from ascertaining any suit assailing the
validity of a tax assessed under said Act until the taxpayer shall have paid, under
protest, the taxes assessed against him, thus:
“SEC. 54. Restriction Upon Power of Court to Impeach Tax. – No court shall entertain any suit assailing the validity of a tax assessed under this Act until the taxpayer shall have paid, under protest, the taxes assessed against him, nor shall any court declare any tax invalid by reason of . . .”
Upon the other hand, the provisions of Sec. 7, Par. 3 of PD 76, Section 37
of PD 464, and Section 231 of RA 7160 merely declare or state that filing of an
appeal “shall, in no case, suspend the collection of the corresponding realty
taxes on the property involved as assessed by the provincial or city assessor.”
The phrase “shall, in no case, suspend the collection of the realty taxes”
explains the “effect of appeal on the payment of real property tax”, the latter
phrase being the caption of Section 231 of RA 7160. It simply means that an
appeal has “no effect” on the process of collecting the corresponding realty
taxes. The treasurer concerned may proceed with the collection of the taxes
involved through the remedies provided for under Sections 265 and 266 of RA
7160, without even taking cognizance or notice of an appeal being filed since the
pending appeal cannot be used as a defense by the taxpayer-appellant against
such collection.
If the legislature wanted the corresponding taxes to be paid before the
appeal may be entertained and heard, it could have easily provided so in clear
and unambiguous language as the National Assembly did under Section 54 of
Commonwealth Act No. 470. Compelling a taxpayer to pay the realty tax involved
Reference: Book XIII, pp. 109-117
before its appeal may be entertained and heard is just not one of the remedies
afforded the government under the Local Government Code of 1991.
In Spouses Ramon A. Gonzales and Lilia Yusay vs. Province of Iloilo (38
SCRA 209-227, March 31, 1971), the Supreme Court rejected the contention that
the property owner should first pay the questionable realty tax before lodging an
appeal, thus:
“. . . The Court has therefore adopted the simple test that where an assessment is disputed for whatever ground or reason, be it that the assessment is unjust, erroneous or improper, illegal or void or excessive or unreasonable, that action challenging the assessment, after first exhausting the administrative remedy of appeal to the assessment board, and regardless of whether the corresponding realty tax had been paid and a refund sought, pertains to the exclusive and special jurisdiction of the tax court to the exclusion of the courts of first instance. Thus, in the recently decided case of Board of Assessment Appeals of Zamboanga del Sur vs. Samar Mining Co. and Court of Appeals (L-28034, Feb. 27, 1971), the Court upheld the jurisdiction of the tax court to rule upon the legality and validity of the disputed real estate assessment, rejecting the contention therein that the property owner should first pay the questioned realty tax before lodging an appeal from the assessment appeals board’s adverse decision to the tax court . . .” (Emphasis supplied)
The aforequoted case was governed by Republic Act 1125, Section 11 of
which “does not require that before an appeal from the decision of the Board of
Assessment Appeals can be brought to the Court of Tax Appeals it must be first
shown that the party disputing the assessment had paid under protest the realty
tax being assessed . . . Section 54 of Commonwealth Act No. 470 does not apply
and said section can be considered as impliedly repealed by Sections 11 and 21
of RA 1125.” (Board of Assessment Appeals of Zamboanga del Sur vs. Samar
Mining Co., Inc., supra).
We believe, therefore, and so hold, that the Local Board erred in refusing
to hear the appeal for lack of prior payment of taxes on the questioned
assessment.
WHEREFORE, the Secretary of this Board is hereby instructed to remand
the complete records of this case, together with a copy of this Resolution, to the
Local Board of Assessment Appeals of La Carlota City. The same Local Board is
hereby ORDERED to hear petitioner’s appeal thereat on its merits, without
requiring Mr. Eduardo T. Rodriquez to first pay the taxes on the questioned
assessment.
Reference: Book XIII, pp. 109-117
SO ORDERED.
Manila, Philippines, October 04, 2006.
(Signed) CESAR S. GUTIERREZ
Chairman
(Signed)
ANGEL P. PALOMARES Member
(Signed) RAFAEL O. CORTES
Member
Reference: Book XIII, pp. 109-117