Case Digest (G.R. No. L-21183)
Facts:
In Victorias Milling Co., Inc. vs. Municipality of Victorias, G.R. No. L-21183, decided on September 27, 1968, the Plaintiff-Appellant, Victorias Milling Co., Inc., operates both a sugar central and a sugar refinery in the Municipality of Victorias, Negros Occidental. On September 22, 1956, the Municipal Council enacted Ordinance No. 1, series of 1956, amending earlier ordinances (No. 25, series of 1953, on sugar centrals, and No. 18, series of 1947, on sugar refineries) by increasing annual license taxes through a graduated schedule based on output capacity, with a maximum rate of ₱40,000.00 for the largest producers. Relying on Commonwealth Act No. 472 as its taxing authority and following approval by the Provincial Board and the Undersecretary of Finance effective January 1, 1957, the Municipality began collecting the higher taxes. Victorias Milling paid under protest ₱280,000.00 covering the first quarter of 1957 to the second quarter of 1960 and filed Civil Case No. 5565 beCase Digest (G.R. No. L-21183)
Facts:
- Ordinance and schedules
- Municipality of Victorias enacted Ordinance No. 1, Series of 1956 on September 22, 1956, amending:
- Ordinance No. 25, Series of 1953 (sugar centrals license tax)
- Ordinance No. 18, Series of 1947 (sugar refineries license tax)
- License‐tax schedules based on annual output capacity:
- Sugar centrals: 50,000 piculs ⇒ ₱1,000 up to ≥ 1,500,001 piculs ⇒ ₱40,000
- Sugar refineries: 25,000 bags ⇒ ₱1,000 up to ≥ 1,750,001 bags ⇒ ₱40,000
- Parties, suit and trial outcome
- Plaintiff‐Appellant: Victorias Milling Co., Inc., sole operator of both central and refinery within Victorias
- Civil Case No. 5565 (CFI, Negros Occidental): sought declaration of nullity of Ordinance No. 1, refund of protested taxes, and enforcement of Sec. 357, Revised Manual of Instructions (treatment of protested collections)
- Trial court held:
- Ordinance is a license tax limited to regulatory cost—rates were unreasonable and excessive
- Ordinance invalid; refused refund of ₱280,000 paid under protest before notice
- Ordered future refunds only after notice of decision
Issues:
- Nature and validity of Ordinance No. 1
- Regulatory license fee vs. revenue‐raising license tax under Commonwealth Act 472
- Requirement of Secretary of Finance approval under C.A. 472, Sec. 4(2)
- Constitutional and statutory challenges
- Preemption by national government’s percentage tax on sugar centrals/refineries (NIRC Sec. 189)
- Reasonableness/excessiveness of graduated rates
- Discrimination: plaintiff as sole operator
- Double taxation: raw sugar taxed twice
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)