Case Digest (G.R. No. 144486)
Facts:
Radio Communications of the Philippines, Inc. v. Provincial Assessor of South Cotabato, G.R. No. 144486, April 13, 2005, Supreme Court First Division, Carpio, J., writing for the Court.In 1957 RCPI was granted a fifty-year franchise under Republic Act No. 2036, and Section 14 of RA 2036 as amended by Republic Act No. 4054 provided (among other things) that RCPI would pay a franchise tax “in lieu of any and all taxes” but also stated that the grantee shall pay “the same taxes … on real estate, buildings and other personal property except radio equipment, machinery and spare parts needed in connection with the business of the grantee” (emphasis in source).
On June 10, 1985 the Municipal Treasurer of Tupi, South Cotabato assessed RCPI real property taxes for 1981–1985, demanding payment of P166,810 for properties declared under Tax Declarations Nos. 7639–7642: the radio station building, a machinery shed, a radio relay station tower and accessories, and two generating sets. RCPI protested to the Local Board of Assessment Appeals (LBAA), arguing the assessed items were personal property or, if real property, exempt under its franchise; it also invoked PD 464 (the Real Property Tax Code) to argue the assessed equipment were not taxable machinery because they were not used for manufacturing, commercial, mining, industrial, or agricultural purposes, and it asserted depreciation should have been allowed.
The LBAA (Koronadal) in a decision dated May 19, 1995 upheld the assessments and ordered RCPI to pay. RCPI appealed to the Central Board of Assessment Appeals (CBAA), which on November 7, 1996 dismissed RCPI’s appeal and affirmed the LBAA: the CBAA concluded the franchise exemption applied only to personal radio equipment, machinery and spare parts and did not exempt the assessed real properties from real property tax.
RCPI then filed a petition for review with the Court of Appeals. In its decision dated March 29, 2000 (CA‑G.R. SP No. 47446), the Court of Appeals modified the CBAA: it held RCPI exempt from real property tax on the generating sets and on radio equipment mounted as accessories to its relay tower, but it affirmed tax liability for the radio station building, machinery shed, and the relay tower itself. RCPI’s motion for reconsideration was denied by the Court of Appeals.
RCPI elevated the case to the Supreme Court by a petition for review under Rule 45 of the 1997 Rules of Civil Procedure. The Supreme Court considered (1) whether the appellate court erred in excluding the tower, relay station building and machinery shed...(Subscriber-Only)
Issues:
- Did the Court of Appeals err in excluding RCPI’s relay station tower, radio station building, and machinery shed from the exemption under Section 14 of RA 2036, as amended by RA 4054?
- Were the tax declarations and assessments void for failure to include a d...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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