Facts:

• The case involves the Philippine Acetylene Company (plaintiff-appellee) seeking the recovery of taxes paid to the Central Bank of the Philippines (defendant-appellant) for the importation of skid tanks used in the packaging and distribution of liquefied petroleum gas.
• The skid tanks were imported by the plaintiff for transporting and storing the gas, which it bought from Caltex for sale to its customers.
• The plaintiff requested a refund of the taxes, arguing that the tax had been collected on accessories or equipment for use in an industry.
• The refund was denied, leading to the present action.

Issue:

• (Unlock)

Ruling:

• The Manila court of first instance ruled in favor of the plaintiff, ordering the Central Bank to return the taxes collected....(Unlock)

Ratio:

• The court determined that the plaintiff is engaged in the industry of manufacturing and selling acetylene gas, oxygen gas, and other gases.
• While it does not manufacture liquefied petroleum gas, it imports the skid tanks for transporting and storing the gas.
• The Central Bank argued that the plaintiff is not engaged in an industry for which the skid tanks are indispensable, as it is merely a merchant using the tanks in its business.
• However, the court disagreed and held that the plaintiff is actually engaged in the manufacture of gases and in the packaging and distribution of liquefied petroleum gas.
• It noted that the handling of petroleum gas through skid tanks requires technical skill and ingenuity, making it an industry rather...continue reading