Case Digest (G.R. No. 171586)
Facts:
National Power Corporation v. Province of Quezon and Municipality of Pagbilao, G.R. No. 171586, January 25, 2010, Supreme Court Special Second Division, Brion, J., writing for the Court.The Province of Quezon assessed Mirant Pagbilao Corporation for unpaid real property taxes amounting to about P1.5 billion for machineries in its Pagbilao power plant; National Power Corporation (Napocor), which had entered into a Build-Operate-Transfer (BOT) Energy Conversion Agreement with Mirant, was furnished a copy of the assessment. Instead of Mirant, Napocor filed a protest before the Local Board of Assessment Appeals (LBAA) claiming entitlement to exemptions under Section 234(c) and (e) of the Local Government Code (LGC) (exempting machinery of government-owned corporations engaged in power generation and pollution-control equipment), and alternatively asserting tax privileges (the 10% assessment level under Section 218(d) and depreciation under Section 225).
The LBAA dismissed Napocor's petition for failure to comply with Section 252 of the LGC (payment under protest). On appeal the Central Board of Assessment Appeals (CBAA) dismissed Napocor's appeal for failure to meet exemption requirements but expressed the view that Section 252's payment requirement applies only when the taxpayer questions the reasonableness of the assessment, not where the taxpayer claims a legal exemption. Napocor then elevated the matter to the Court of Tax Appeals (CTA), and this Court issued a Decision on July 15, 2009 denying Napocor's claimed exemptions and privileges primarily on the ground that Napocor lacked the requisite legal interest (standing) to protest the assessment and thus its protest was defective; the Court held that contractual assumption of tax liability did not confer the legal interest needed to invoke the administrative remedies.
Napocor moved for reconsideration and sought referral to the Court En Banc; the Philippine Independent Power Producers Association, Inc. (PIPPA) moved to intervene. While the motion for reconsideration was pending, the Court declined En Banc referral and considered PIPPA's motions; the Court resolved that the primary outstandi...(Subscriber-Only)
Issues:
- Does Napocor have the statutory standing—i.e., is it a “person having legal interest in the property”—to file a protest under Section 226 of the LGC against the real property tax assessment on machineries owned and used by Mirant?
- Was Napocor required to comply with the payment-under-protest requirement of Section 252 of the LGC before filing an appeal with the LBAA when it claims exemption from real property tax?
- On the merits, can Napocor claim the exemptions/privileges it asserted (Section 234(c)/(e), Section 218(d),...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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