Case Digest (G.R. No. L-23425)
Facts:
The Commissioner of Customs and the Commissioner of Internal Revenue v. Miguel Fortich Celdran and the Court of Tax Appeals, G.R. No. L-23425, February 26, 1968, the Supreme Court En Banc, Concepcion, C.J., writing for the Court.In October 1960 Miguel Fortich Celdran, a Filipino physician returning from the United States after about two years, brought into the Port of Cebu a 1959 Chevrolet "Impala" as part of his personal effects. The Collector of Customs of Cebu exempted the car from customs duty under Section 105(i) of the Tariff and Customs Code but assessed and collected P889.52 as special import tax, P11,295.12 as compensating tax, and a P35.00 fine for alleged non‑filing of a consular invoice; Celdran paid these amounts under protest.
Celdran appealed administratively to the Commissioner of Customs, who largely sustained the assessments but ordered a refund of P25.00 of the fine. Thereafter Celdran petitioned the Court of Tax Appeals (CTA), which modified the challenged administrative decision by eliminating a 25% "margin fee" from the tax base and by taking the invoice value of US$2,150.00 as the taxable value; the CTA directed the Commissioners to refund the resulting overpayments to petitioner.
The Government, through the Solicitor General acting for the Commissioner of Customs and the Commissioner of Internal Revenue, appealed to the Supreme Court contesting (1) the exclusion of the 25% margin fee from the tax base and (2) the CTA’s use of the seller’s invoice value rather than the published retail ("red book") factory price under Finance Department Order No. 289‑A. Central Bank Circular No....(Subscriber-Only)
Issues:
- Did the 25% margin fee prescribed by Central Bank Circular No. 95 form part of the tax base for computing the special import and compensating taxes on the car?
- For purposes of computing those taxes, should the taxable value be the seller’s invoice price (US$2,150.00) or the published retail factory ("red book") price (US$2,717.00) as directed by Finance Department Order No. 289‑A and appraiser determination under Section...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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