Republic of the Philippines
CENTRAL BOARD OF ASSESSMENT APPEALS M a n i l a
LUNG CENTER OF THE PHILIPPINES, CBAA Case No. L-13-94 Petitioner-Appellant,
– versus –
BOARD OF ASSESSMENT APPEALS OF QUEZON CITY,
– and –
CONSTANTINO P. ROSAS, in his capacity as CITY ASSESSOR OF QUEZON CITY,
Respondent-Appellee. x – – – – – – – – – – – – – – – – – – – – – – – – – – – – – x
R E S O L U T I O N
Petitioner-Appellant, Lung Center of the Philippines files this Motion for
Reconsideration on the Decision of this Board in CBAA Case No. L-13-94 as
‘Contrary to its allegations that it is functioning for charitable purposes only, pertinent documents proved otherwise, that its premises/real properties which they claimed for exemption are not actually, directly and exclusively used for such purposes as contemplated in the fundamental law of the land and that only a small portion is indeed, devoted to the service of charity patients as manifested in the income statements submitted on record with this Board. Financial statements of the Lung Center of the Philippines from 1991 to 1994 show that they have been receiving an annual subsidy from the government which are being spent by the institution for its free or charitable services. Moreover, it can be gleaned from the figures stated therein that the government subsidy far exceeds the amount spent for quantified free services and that the remainder of the subsidy goes to the Center for its own benefit. If that is the case, the fees and other charges being collected by the said hospital from its patients partake of the nature of an income, hence, petitioner-appellant is an income-generating institution. The findings of the Board below are factually accurate and deemed adopted by this board in toto.’
Petitioner-Appellant imputes the following:
‘X x x, the aforequoted finding of this Honorable Board is contrary to the Constitution, pertinent provisions of law, jurisprudence and evidence adduced. A re-examination of its charter readily shows that petitioner LCP is functioning for charitable purpose. Thus, it is provided in the whereas clause of its charter that petitioner LCP was created to prevent, treat and rehabilitate people affected by lung diseases. It is further stated that the establishment and maintenance of petitioner LCP is for the welfare and benefit of the Filipino people.”
In his “Opposition to the Motion for Reconsideration”, Respondent-
Appellee refutes as follows:
Reference: Book VIII, pp. 160-163
1. “X x x Petitioner-Appellant, LCP is not a charitable institution x x x, as can clearly be read from its Charter or Presidential Decree No. 1823,x x x, which provides as follows:
‘SEC. 2 – TAX EXEMPTION AND PRIVILEGES Being a non-profit, non-stock corporation organized primarily to help combat the high incidence of lung and pulmonary diseases in the Philippines, all donations, contributions, endowments and equipment and supplies to be imported by authorized entities or persons and by the Board of Trustees of the Lung Center of the Philippines, Inc., for the actual use and benefit of the Lung Center, shall be exempt from income and gift taxes, the same further deductible in full for the purpose of determining the maximum deductible amount under Section 30, paragraph (h) of the National Internal Revenue Code, as amended.
‘The Lung Center of the Philippines shall be exempt from payment of taxes, charges, and fees imposed by the Government or any political subdivision or instrumentality thereof with respect to equipment purchases made by, or by the Lung Center.’
2. “X x x What is not included in the enumeration is thereby excluded. This is in accordance with the legal maxim ‘Expressio Unius Est Exclusio Alterius”.
3. “If it is (sic) the intention of PD 1823 is to exempt the Petitioner-Appellant LCP from paying realty taxes, it can readily do so by including it among the enumeration of tax exemption privileges in Section 2 of the said Decree or emphasizing it that it is a charitable institution.”
4. “Its primary purpose is to combat the high incidence of lung and pulmonary diseases in the Philippines. However, to accomplish this objective, it does not necessarily mean that the Petitioner-Appellant LCP should perform it through charity works.”
5. “Contrary to the claims of the Petitioner-Appellant LCP, the (sic) their (sic) properties subject of the above-entitled case are not actually, directly, and exclusively used for charitable purposes. A big portion of its land is being leased to private person who uses it for commercial purposes.”
6. “The government subsidy is granted to the Center not purposely for latter to render charitable or free services, but to ensure the continued operation and maintenance of the Center in the pursuit of its objectives. The subsidy shall continue until such time the Center can be self-sufficient and can stand on its own.”
From the above-disputations, it is apparent that Petitioner-Appellant
introduced nothing new that was not set forth in the findings of this Board and
the Board below. Accordingly, Petitioner-Appellant’s “Motion for
Reconsideration” suffers from a Pro Forma reputation. (See Court of Appeals
Decision: Vargas vs. Kayanan, January 20, 1970). On the other hand, it is
evident that Respondent-Appellee’s ratiocination stands out against Petitioner-
Appellant’s argument. Respondent-Appellee’s ratiocination is utterly sustainable
and is hereby sustained by this Board.
Reference: Book VIII, pp. 160-163
Plain and clear is the provision of the 1987 Constitution of the Philippines
(Sec. 28(3), Art. VI), that before charitable institution could be exempted from
taxation, it should be “actually, directly, and exclusively used” as such.
(Underscoring supplied.) The following definitions are given by Black’s Law
Dictionary, Fifty Edition:
“Actually is opposed to seemingly, pretendedly, or feignedly, as actually engaged in farming means really, truly in fact.”
“Directly. In a direct way without anything intervening; not by secondary, but by direct means.”
“Exclusively. Apart from all others; only solely; substantially all or for the greater part. To the exclusion of all others; without admission of others to participation; in a manner to exclude.”
The above-definitions, particularly with regard to “exclusively”, belie
LCP’s claim that it is a charitable institution within the context of the provision
therefor of the 1987 Philippine Constitution.
WHEREFORE, finding no sufficient justification to disturb or alter this
Board’s original decision, the Motion for Reconsideration is hereby denied for
lack of merit.
Manila, Philippines, January 7, 2000.
(Signed) CESAR S. GUTIERREZ
ANGEL P. PALOMARES Member
(Abstained) BENJAMIN M. KASALA
Reference: Book VIII, pp. 160-163