Case Summary (G.R. No. 100866)
Procedural Background and Resolutions
The petition for certiorari challenges several resolutions of the Court of Tax Appeals (CTA) En Banc. Initially, on February 7, 2013, the CTA granted PMO’s motion for suspension of the collection of real property taxes but required it to post a surety bond equivalent to one and a half times the amount sought. Subsequently, the CTA issued a resolution on March 1, 2013, finding PMO's motion to exempt itself from the surety bond moot, as PMO had already posted the bond. Finally, the CTA denied PMO’s motion for reconsideration on January 29, 2014.
Legal Issues Addressed
Central to the issues presented in this petition is whether the PMO, as a government agency, is obliged to post a surety bond in order to suspend the collection of taxes under the provisions of Republic Act (R.A.) No. 9282, which amends the CTA's procedural rules regarding tax appeals. The petitioner contends that as a national government agency, it should be exempt from the bond requirement due to the presumption of governmental solvency.
Legislative Framework
R.A. No. 9282 provides that an appeal taken to the CTA does not suspend the payment of taxes but allows the court some discretion to suspend collection if it may jeopardize the government or taxpayer interests. The court can mitigate the tax burden by requiring a surety bond or a deposit of the contested amount to ensure the payment of taxes in case the taxpayer's appeal is unsuccessful.
Arguments by the Petitioner
The PMO argues for exemption from posting a surety bond, citing previous cases where the courts did not impose such conditions on state entities. Specifically, the petitioner references the case of Collector of Internal Revenue v. Reyes, emphasizing that the state’s solvency should allow it to forgo this requirement. The PMO asserts that compliance with the CTA’s bond requirement does not moot the question of its legal obligations regarding the bond.
Analysis of Tax Liability
The court highlighted the legal principle that although the property in question may be subject to taxes, the collection methods employed must comply with established law. The method utilized by the City Government—issuing warrants of levy and attempting to auction a property of public dominion—was found to contravene these legal standards.
Public Dominion and Taxation
The subject property, being classified as a property of public dominion, is exempt from being sold or encumbered through public auction. The Civil Code articulates that prope
...continue readingCase Syllabus (G.R. No. 100866)
Case Background
- This case involves a Petition for Certiorari filed under Rule 65 of the 1997 Rules of Court by the Privatization and Management Office (PMO) against the Court of Tax Appeals (CTA) and the City Government of Tacloban.
- The legal dispute centers on three specific Resolutions of the CTA En Banc:
- Resolution dated February 7, 2013, granting a Motion for Suspension of Collection of Real Property Tax, conditional on the posting of a surety bond.
- Resolution dated March 1, 2013, declaring as moot a Motion for Exemption from Posting of Surety Bond filed by PMO and the Philippine Tourism Authority (PTA).
- Resolution dated January 29, 2014, denying PMO's Motion for Reconsideration.
- The PMO, the Province of Leyte, and the PTA are co-owners of the Leyte Park Hotel, Inc. (LPHI), which is situated in the taxing jurisdiction of the City of Tacloban.
Facts of the Case
- LPHI was leased to Unimaster Conglomeration, Inc. (UCI) for a monthly rental of ₱300,000.00 over a 12-year period.
- The City Government issued several demand letters to UCI for the payment of real property taxes amounting to ₱23,377,353.08, which remained unpaid.
- In response, the City filed a complaint for collection against LPHI and UCI on December 15, 2004, later amending the complaint to include the Province of Leyte, PTA, and PMO as defendants.
- The CTA Special First Division ruled that UCI was liable for the unpaid real property taxes, which led UCI to seek reconsideration and subsequently file a P