Case Digest (G.R. No. L-19201)
Facts:
Rev. Fr. Casimiro Lladoc v. The Commissioner of the Internal Revenue and the Court of Tax Appeals, G.R. No. L-19201, June 16, 1965, the Supreme Court En Banc, Paredes, J., writing for the Court (Bengzon, C.J., Bautista, Angelo, Concepcion, Reyes, J.B.L., Dizon, Regala, Makalintal, Bengzon, J., and Zaldivar, JJ., concurring).In 1957 M.B. Estate, Inc. of Bacolod City donated P10,000.00 in cash to Rev. Fr. Crispin Ruiz, then parish priest of Victorias, Negros Occidental, for construction of a new Catholic church; the sum was actually applied to that purpose. The donor filed the donor's gift tax return on March 3, 1958. On April 29, 1960 the Commissioner of Internal Revenue issued an assessment for donee's gift tax against the Catholic Parish of Victorias, of which petitioner Rev. Fr. Casimiro Lladoc later became parish priest. The assessment totaled P1,370.00, inclusive of surcharges, interest at 1% monthly from May 15, 1958 to June 15, 1960, and a compromise for late filing.
Petitioner protested and sought withdrawal of the assessment; the Commissioner denied the protest and motion for reconsideration. Petitioner then appealed to the Court of Tax Appeals by filing a petition for review on November 2, 1960, contending (among other points) that he was not parish priest at the time of the donation, that there is no juridical person called "Catholic Parish Priest of Victorias" and thus he should not be personally liable, and that assessment against the Roman Catholic Church would violate the constitutional exemption in Article VI, Section 22(3).
After hearing, the Court of Tax Appeals rendered judgment holding that parish priests under canon law are guardians/administrators of parish property and may sue and be sued; that the constitutional exemption for churches applies to property taxes and not to excise taxes such as the gift tax (citing Phipps v. Commissioner of Internal Revenue, among authorities); and that exemptions are strictly construed. It affirmed the Commissioner's assessment except as to a P20 compromise penalty, and ordered petitioner to pay P900.00 as donee's gift tax plus a 5% ad valorem surcharge under Section 119(c) of the Tax Code and 1% monthly interest from May 15, 1958.
Petitioner appealed to the Supreme Court. The Court considered whether the constitutional exemption barred the gift tax and who properly should be held liable to pay. The Court ordered the parties to show cause why the Head of ...(Pro-only)
Issues:
- Does Article VI, Section 22(3) of the Constitution exempt the donee's gift tax assessed on the donation to the parish church?
- Who is the proper party liable for the assessed donee's gift tax — petitioner Rev. Fr. Casimiro Lladoc personally, or the Head of the Diocese as the re...(Pro-only)
Ruling:
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Ratio:
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Doctrine:
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