Case Summary (G.R. No. 165641)
Background Facts
The case originated when LMWD sought tax exemptions for specific properties, including water supply equipment and a Toyota Hi-Lux pick-up truck, which were granted to them by the Japanese Government to rehabilitate their water supply system impacted by typhoon damage. On July 5, 1995, the Department of Finance (DOF) granted an exemption for the water supply equipment but assessed taxes on the vehicle. Following a request for reconsideration regarding the vehicle's tax exemption, the DOF denied the request based on Executive Order No. 93, which retracted tax exemptions for government agencies and government-owned and controlled corporations (GOCCs). LMWD subsequently appealed to the Court of Tax Appeals (CTA), which dismissed the petition for lack of jurisdiction, stating LMWD was a GOCC with an original charter.
The Petition
LMWD's appeal to the Supreme Court questioned whether water districts should legally be classified as GOCCs with original charters. LMWD argued that under the Constitution and Presidential Decree No. 198, water districts are private corporations entitled to tax exemptions, claiming discrepancies with their classification as GOCCs. They stressed that P.D. No. 198 serves as a general law that parallels the Corporation Code, asserting that it does not constitute an original charter. This position was supported by their interpretation of the provisions under P.D. No. 198 governing the formation and classification of water districts.
The Petition-in-Intervention
On February 17, 2005, Napoleon G. Aranez, on behalf of the Coalition, filed a motion to intervene, representing numerous water district concessionaires nationwide. The Coalition advanced three main arguments reiterating that water districts should not be classified as GOCCs, highlighting concerns over the constitutionality of current classifications and potential adverse socio-economic impacts if the appealed decision remained uncorrected.
The Court's Ruling
The Supreme Court dismissed both the primary petition and the petition in intervention. It firmly reiterated the classification of local water districts as GOCCs with special charters, firmly established in previous rulings, including the case of Feliciano v. Commission on Audit. The Court emph
...continue readingCase Syllabus (G.R. No. 165641)
Overview of the Case
- This case involves a Petition for Review on Certiorari filed by Engr. Ranulfo C. Feliciano, representing the Leyte Metropolitan Water District (LMWD), seeking to overturn a July 14, 2004 decision made by the Court of Appeals (CA).
- The CA upheld the Court of Tax Appeals (CTA) ruling which dismissed LMWD's petition for lack of jurisdiction.
- The "No Tax, No Impairment of Contracts Coalition, Inc." represented by Napoleon G. Aranez intervened in the case, supporting LMWD’s position.
Background Facts
- LMWD sought a tax exemption from the Department of Finance (DOF) for water supply equipment and a Toyota Hi-Lux pick-up truck received as a grant from the Japanese Government for rehabilitation purposes after a typhoon.
- The DOF granted tax exemption for the water supply equipment but assessed taxes on the vehicle.
- Following the denial of reconsideration by the DOF regarding the vehicle's tax exemption, LMWD appealed to the CTA.
- CTA concluded that LMWD is a government-owned and controlled corporation (GOCC) with an original char