remedies under local government code

8/3/2019 Remedies Under Local Government Code

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REMEDIES UNDER LGC. REMEDIES UNDER LGC. REMEDIES UNDER LGC. REMEDIES UNDER LGC.

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I. Local Taxes in GeneralA. Assessment/Collection1. Accrual/Tax Period/ Manner of Payment/ Surcharge and PenaltiesSec. 165. Tax Period and Manner of Payment-calendar year-may be paid in quarterly installments

Sec. 166. Accrual of Tax.-on 1st day of January-if NEW tax: 1st day of the quarter next following the effectivity of the ordinance imposing new tax

Sec. 167. Time of Payment.GR: w/n first 20d ofJanuarySubsequent quarter (if new tax)X: unless provided by this codeEXTENSION: extended by the Sanggunian-for a justifiable reason-only for 6m max

Sec. 168. Surcharges and Penalties on Unpaid Taxes, Fees, or Charges.

-sanggunian may impose-SURCHARGE: 25% of amt of unpaid TFC MAX-INTEREST: 2% per month of unpaid TFC + surcharge (until amt paid)TOTAL interest: max of 36m! (*so if di ka pa bayad after 36m di ka na nila sisingilin or di ka na lang nila iimposanng interest?)

Sec. 169. Interests on Other Unpaid Revenues.-Amt due (not: TFC/VOLUNTARY contributions/Donations)-not paid*on the date fixed by the:ordinancecontract*or upon the occurrence of the event which gave rise to collectionINTEREST: 2% pm but TOTAL INTEREST max 36months

Sec. 170. Collection of Local Revenues by Treasurer.-All TFC collected by respective treasurers/deputies-provincial/city/municipal treasurer designates brgy treasurer as deputy: BOND required (premiums of the bond paidby provincial/city/municipal govt)

Sec. 171. Examination of Books of Accounts and Pertinent Records of Businessmen by Local Treasurer.WHO examines: P/C/M/B treasurer

Deputy authorized in writingWHAT SHOULD BE CONTAINED IN THE WRITTEN AUTHORITY:1. name, address, and business of the taxpayer whose books, accounts, and pertinent records are to

be examined2. date and place of such examination3. procedure to be followed in conducting the same

WHAT to examine: books, accounts, and other pertinent records (BAR)Of WHAT: person, partnership, corporation, or association subject to local TFC (PPCA)WHY: in order to ascertain, assess, and collect the correct amount of the TFCWHEN: regular business hours

only once for every tax periodCERTIFICATION: by the examining official made of record in the books of accounts of the taxpayer examined*RECORDS of the RDO of BIR should be made available to the examining official

2. Collection of the Tax CHAPTER 4. Civil Remedies for Collection of Revenues (Remedies of the LGU)Sec. 172. Application of Chapter. for the collection of any delinquent local tax, fee, charge, or other revenue

Sec. 173. Local Government's Lien.-local TFCR constitute a SUPERIOR LIEN: upon any property/rights which may be subject to the lien/property used inbusiness, occupation, practice of profession/calling-ENFORCEMENT:.administrative actionjudicial action-EXTINGUISHMENT: full payment of the delinquent local TFC + surcharge + interest

Sec. 174. Civil Remedies.(a) By administrative action through distraint of goods, chattels, or effects, and other personal property ofwhatever character, including stocks and other securities, debts, credits, bank accounts, and interest in and rights topersonal property, and by levy upon real property and interest in or rights to real property; and(b) Byjudicial action. concurrently or simultaneously (discretion of LGU)

Sec. 175. Distraint of Personal Property.(a) SeizureWhen: Upon failure of the person owing any local TFC to pay the same at the time requiredWho: the local treasurer/deputyHow: upon written notice

- local treasurer /deputy issue a duly authenticated certificate based upon the records of his office- Contents of the certificate:*fact of delinquency* amounts of the TFC* amount of penalty due- Such certificate shall serve as sufficient warrant for the distraint of personal property aforementioned,subject to the taxpayer's right to claim exemption under the provisions of existing laws.

What: any personal property belonging to that person /any personal property subject to the lien in sufficient quantity tosatisfy the TFC in question + any increment thereto incident to delinquency and the expenses of seizure.

- Distrained personal property shall be sold at public auction in the manner herein provided for.

(b) Accounting of distrained goods.Who: officer executing the distraintWhat: goods, chattels or effects distrainedFormalities: a copy of the account made signed by himself shall be left either with the owner or person from whosepossession the goods, chattels or effects are taken, or at the dwelling or place of business of that person and withsomeone of suitable age and discretion, to which list shall be added a statement of the sum demanded and a note ofthe time and place of sale.

(c) Publication-Where: min 3 public and conspicuous places in the territory of the local government unit where the distraint is made(including office of the chief executive of the local government unit in which the property is distrained)

-contents:

*NOTE: Distraint: Personal Property = Levy: Real Property


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>time>place>articles distrained

-TIME Of sale: not be less than twenty (20) days after notice to the owner or possessor of the property and thepublication or posting of the notice

(d) Release of distrained property upon payment prior to sale. Restore goods to the owner

(e) Procedure of sale-sell at PUBLIC AUCTION-to the HIGHEST BIDDER FOR CASH-w/n 5d after the sale, LOCAL TREASURER shall make a WRITTEN REPORT OF THE PROCEEDINGS to the localchief executive**IF NOT SOLD w/n 120d fr date of distraint: considered sold to the LGU concerned for amt assessed byCOAppraisal, tax delinquencies cancelled to extent of same amount*CoAppraisal: city/municipal treasurer + rep of COA + city/municipal assessor

(f) Disposition of proceeds-apply to satisfy: tax + surcharges + interest + other penalties incident to delinquency + (expenses of the distraint +expenses of the sale)*-if may natira: return to owner of property sold-if kulang: other property of the delinquent taxpayer may be distrained until full amount due + all expenses collected*actual expenses of seizure and preservation of the property pending sale; DOES NOT INCLUDE services of thelocal officer/deputy

Sec. 176. Levy on Real Property.When: After the expiration of the time required to pay the delinquent TFCbefore/simultaneously/after distraint of personal propertyWhat: real propertyHow: provincial/city/municipal treasurer prepare duly authenticated certificatecontents:

1. name of taxpayer2. amt of TFC3. amt of penalty due4. + write upon certificate the description of the property upon which the levy is made

certificate operate w/ force of a legal execution throughout the Philippines+ mail/serve WRITTEN NOTICE OF LEVY upon:

1. assessor: annotate on tax declaration of property2. Register of Deeds where property located: annotate the levy on the certificate of title of property3. delinquent taxpayer (if absent: to agent/manager of business/occupant of property if first 2 wala)

***If Levy not issued BEFORE OR SIMULTANEOUSLY with Distraint + personal property INSUFFICIENT to satisfydelinquency: provincial/city/municipal treasurer proceed with levy on RP w/n 30d after execution of distraintReport on levy: w/n 10d from receipt of warrant + submitted to sanggunian concerned (not local chief exec)Sec. 177. Penalty for Failure to Issue and Execute Warrant.criminal prosecution under RPC+AUTOMATIC DISMISSAL from service (Reqs):

(1) Treasurer fails to issue/execute the warrant of distraint/levy after expiration of time prescribed (which isafter the expiration of time required to pay the delinquent TFC); or

(2) Treasurer found guilty of abusing the exercise of power(3) Due notice and Hearing (Due Process)

Sec. 178. Advertisement and Sale.When: Within thirty (30) days after levy

Period: at least thirty (30) days

How: A. posting a notice at(1) the main entrance of the municipal building or city hall(2) a public and conspicuous place in the barangay where the real property is locatedB. publication once a week for three (3) weeks in a newspaper of general circulation in the province, city ormunicipality where the property is locatedContents:

a. amount of TFCb. penalties duec.

time and place of saled. name of the taxpayer against whom the TFC are levied

e. short description of the property to be soldSTAY of SALE: payment by taxpayer of the TFC+ penalties +interestsIf no payment before date of sale: sale proceedSALEWhere. A. at the main entrance of the provincial, city or municipal buildingB. on the property to be soldC. at any other place as determined by the local treasurer conducting the sale and specified in the notice of sale.REPORT TO THE SANGGUNIAN of sale: W/n 30d after sale; form part of records of the local treasurerCERTIFICATE of SALE:issued when: after consultation with the sanggunianmade and delivered by local treasurerContents:

a. proceedings of the saleb. description of the property soldc. name of the purchaserd. exact amount of all TFC + surcharges + interests + penalties

May sobra sa benta: turned over to the owner of the property (delinquent taxpayer)*ADVANCE OF COSTS OF COLLECTION: by ordinance duly approvedCOSTS: preservation/transportation/advertisement/sale

Sec. 179. Redemption of Property Sold.PERIOD: Within one (1) year from the date of saleWHO allowed: delinquent taxpayer /representativeHOW: payment to the local treasurerhow much = (total amount of TFC + surcharges + interests + penalties from the date of delinquency to the date ofsale) + (interest of not more than 2% per month on the purchase price from the date of purchase to the date ofredemption)EFFECT:

A. Certificate of Sale InvalidatedB. Owner/Delinquent Taxpayer shall be entitled to a certificate of redemption from the provincial, city or

municipal treasurer/ deputyWhat about the purchaser in the public auction:

1. buyer return the certificate of sale2. provincial/city/municipal treasurer/deputy return to buyerpurchase price + 2%pm interest + portion of

cost of sale + other legitimate expenses incurred by buyerAFTER ALL THAT: property thereafter shall be free from the lien of such taxes, fees, or charges, related surcharges,interests, and penalties.* owner (delinquent taxpayer) NOT DEPRIVED OF THE POSSESSION of said property + entitled to the rentals andother income thereof until the expiration of the time allowed for its redemption so si buyer in public auction couldonly exercise ownership over said property AFTER 1 yr.

Sec. 180. Final Deed to Purchaser.-executed in case the taxpayer fails to redeem the property-conveys to the purchaser so much of the property as has been sold, free from liens of any taxes, fees, charges,

related surcharges, interests, and penalties.


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-recites all the proceedings upon which the validity of the sale depends.

Sec. 181. Purchase of Property By the Local Government Units for Want of Bidder.When:

A. no bidder for the real property advertised for saleB. the highest bid is for an amount insufficient to pay the TFC + surcharges + interests + penalties + costsWHAT HAPPENS: the local treasurer conducting the sale shall purchase the property in behalf of the localgovernment unit concerned to satisfy the claim

REPORT: within 2d after buying for LGU*DUTY of the Registrar of Deeds: upon registration with his office of any such declaration of forfeiture: to transfer thetitle of the forfeited property to the local government unit concerned without the necessity of an order from acompetent court (so automatic pag niregister sa RoD, transfer agad sa LGU ung title)REDEMPTION:WHEN: Within 1yr from the date of such forfeitureWHO allowed: taxpayer /representativeHOW: pay to local treasurer the full amount of the TFC + related surcharges + interests + penalties + costs of saleIf no redemption: ownership shall be fully vested on the LGU concerned

Sec. 182. Resale of Real Estate Taken for Taxes, Fees, or Charges (resale nung property na nabili nila kasiwalang bidder)HOW: by ordinance duly approved + give notice not less than 20d after saleHOW: public auctionPROCEEDS: accrue to the general fund of the local government unit concerned

Sec. 183. Collection of Delinquent Taxes, Fees, Charges or Other RevenuesThrough Judicial ActionWHO: LGU concerned through LOCAL TREASURERHOW: civil actionWHEN: within the period prescribed in Section 194 of this Code: 3/5/10 yrs

Sec. 184. Further Distraint or Levy. repeated if necessary until the full amount due, including all expenses, iscollected.

Sec. 185. Personal Property Exempt from Distraint or Levy. (TiB CFuP LBP)(a) Tools and implements necessarily used by the delinquent taxpayer in his trade or employment;(b) One (1) horse, cow, carabao, or other beast of burden, such as the delinquent taxpayer may select, andnecessarily used by him in his ordinary occupation;(c) His necessary clothing, and that of all his family;(d) Household furniture and utensils necessary for housekeeping and used for that purpose by the delinquenttaxpayer, such as he may select, of a value not exceeding Ten thousand pesos (P10,000.00);

(e) Provisions, including crops, actually provided for individual or family use sufficient for four (4) months;(f) The professional libraries of doctors, engineers, lawyers and judges;(g) One fishing boat and net, not exceeding the total value of Ten thousand pesos (P10,000.00), by the lawful use ofwhich a fisherman earns his livelihood; and(h) Any material or article forming part of a house or improvement of any real property.

3. Assessment of deficiency/delinquent taxSec. 194. Periods of Assessment and Collection.(a) Local TFC

ASSESSMENT: within five (5) years from the date they became dueCOLLECTION: same period, BARRED IF AFTERBut if TFC accrued b4 effectivity of LGC: 3 yrs from due date(b) fraud/ intent to evade: w/n 10years from discoveryof the fraud or intent to evade payment.(d) Suspension of prescriptive periods:

(1) The treasurer is legally preventedfrom making the assessment or collection;

(2) The taxpayer requests for a reinvestigationand executes a waiverin writing before expiration of the period withinwhich to assess or collect; and(3) The taxpayer is out of the countryor otherwise cannot be located.

BLGF Ruling June 13, 2006F: Synovate, Inc. was assessed deficiency of business tax for 2000-2004 (P718,340.91): allegedly amountsdeclared by Synovate Inc forbusiness tax purposes for 2000-2004 were underdeclared vs. taxable revenues reportedin the audited financial statements of the corporation forbase years 1999-2003. Deficiency Business Tax assessed

by deriving the business tax corresponding to the amt of gross revenue as reported in the audited financialstatements then deducting the amount actually paid.-Synovate wrote to City Treasurer: declaration for business tax BASED ON DEFINITION OF GROSS RECEIPTS(amounts actually/constructively received by it), request RECALL/CANCELLATION OF DEFICIENCY ASSESSMENT-Synovate applied for 2005 Business Permit + completed other prerequisites for renewal + made a tender of paymentfor assessed business tax, business permit and other fees for 1st quarter of 2005 (279,390.70) BPLO refusedpayment + didnt issue permit UNTIL payment of deficiency tax assessment-Synovate made another tender of payment to BPLO; BPLO only agreed to accept if Synovate would entercompromise agreement with them-W/n 60-d period provided under S195, LGC, Follosco Law Firm (counsels for Synovate) filed FORMAL PROTEST onsaid deficiency tax assessment + letter to BPLO contesting denial of application for business permit-BPLO only issued TEMPORARY business permit*~*~*~*1. WON Business taxes should be based on GROSS RECEIPTSYES. The gross revenue as reported in the audited financial statements of Synovate, Inc is not the basis for

assessing business tax BUT should be based on money and properties received in consideration of the servicesrendered or articles sold, exchanged or leased. Sec143 provides that Tax on Business is based on the GROSSSALES or RECEIPTS of the business being taxed for the preceding calendar year. Gross sales/receipts excludesreceivables NOT YET COLLECTED. Consideration should already be in the control of the person who rendered theservice.2. WON a LGU can withhold issuance of business tax for nonpayment of deficiency taxNO. The city government IS NOT AUTHORIZED UNDER THE LGC to withhold business permit as a means ofenforcing the collection of delinquent taxes.the specific remedies for enforcing the collection of delinquent taxes (AND IT DOES NOT INCLUDE THEWITHHOLDING OF BUSINESS PERMIT)the taxpayer is entitled under the law to protest a tax assessment. While the legal remedies to contest anassessment is still available to the taxpayer, the local government CANNOT FORCE the taxpayer to pay where suchpayment is not a requisite for exercising such legal remedies.

California Manufacturing Co. v. City of Las PinasF: JUNE 9: California Manufacturing (manufacturer of Knorr cubes!) was sent a Letterby City Treasurer of Las Pinasinforming CMC that:1. It had Local Business Tax Deficiency on Non-essential commodities2. Deficiency RPTTotal deficiency: P73,045,634.47-June 23: CMCs financial accountant attended a conference with City Treasurer + examiners of Las PinasCMC also personally served LETER (dated June 23) requesting ample time to consider the validity of theassessment + asking specific rulings and ordinances supporting their claimCity Treasurer also issued a reply: request granted til July 15 to settle tax deficiency-SEPT 1: CMC filed a supplemental protest vs. assessment for local business tax-OCT 16: CMC filed petition protesting the assessment for local business tax from 1999-June 30, 2003 B4 RTC+ cancellation of assessment-Las Pinas filed MD: (1) CMC no legal capacity to sue (person who signed verification was not an authorized officer:(2) RTC no jurisdiction assessment attained finality due to lack of timely protest (only til July 15!)


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RTC: Granted MD: NO Jurisdiction over the subject matter: CMC was given 60d after notice of assessment to contestthe assessment. Since the letter informing CMC of assessment was sent June 9, was received June 10, CMCSHOULD HAVE FILED PROTEST ON AUG 9, not SEPT 1- CMC filed an Omnibus MFR:(1) June 9 letter was not an assessment(bereft of any statement as to the nature of the TFC, the amount ofdeficiency, the surcharge or interests and penalties);(2) assuming that June 9 letter was an assessment, CMCsrequest for ample time partook of the nature of a

preliminary protest that tolled the running of the 60-day period to file a protest;

(3) if the respondents considered the assessment to be final and unappealable, it would have been natural for therespondents to cite such ground in the denial of the protest.RTC: deny: lack of merit*~*~*WON protest timely filed.NO. Assessments FINAL and EXECUTORY (S195, LGC). Dismiss petition!REQs of VALID ASSESSMENT NOTICE: statement of

1. nature of the TFC2. amount of deficiency3. amount of surcharges + interests + penalties

- Petitionerhad sixty (60) days from June 10, 2003 or until August 9, 2003, within which to protest the aboveassessment.-ESTOPPED na CMC: The June 9 letter has ATTACHMENTS + CMC ADMITTED in Petition for Review that itreceived the notice of assessmenton June 10+ petitioner was able to detail the composition of the deficiency taxassessment based on the table audit sent by Las Pinas, able to counterargue the assessment made

B. Taxpayers Remedies1. Protesting an assessmentSec. 195. Protest of Assessment.WHEN: When the local treasurer or his duly authorized representative finds that correct TFC have not been paidHOW: issue a notice of assessmentcontents of NOTICE OF ASSESSMENT:1. nature of the tax, fee or charge2. the amount of deficiency3. the surcharges + interests + penaltiesPERIOD FOR PROTEST: W/n 60d from the receipt of the notice of assessment (WRITTEN PROTEST)EFFECT if NO PROTEST: the assessment shall become final and executory> Local treasurer decide protest W/N 60d from time of filingif WHOLLY/PARTIALLY MERITORIOUS: local treasurer CANCEL ASSESSMENT

if WHOLLY/PARTLY CORRECT: deny protest wholly/partly W/NOTICE to taxpayer>APPEAL: 30d from receipt of denial of protest/from lapse of 60d period (wherein the local treasurer should havedecided on the protest)with a court of competent jurisdictionIF NO APPEAL: assessment becomes conclusive and unappealable.

a. Protest to the city/municipal treasurerCalifornia Manufacturing Co. v. City of Las Pinas, supra.F: CMC was sent a LETTER JUNE 9 informing it of deficiency business tax. CMC requested extension on JUNE 23,which was granted the same date, giving them until JULY 15 to settle tax deficiency. HOWEVER, CMC did not settletax deficiency, nor filed written protest 60d after receipt of letter of assessment (AUG 10). So when CMC filed SEPT 1a supplemental protest with local treasurer, and a petition with RTC on OCT 16, LP treasurer filed MD based on lackof jurisdiction of RTC, the assessment having attained finality DUE TO LACK OF TIMELY PROTESTH: NO timely protest filed

1. the June 9 letter is considered a NOTICE OF ASSESSMENT: it had attachments + CMC admitted in theirPetition for Review that it received a notice of assessment June 10 + they counterargued the compositionof the deficiency tax assessments based on table audit substantially complied with S195 reqs

2. As June 9 letter is a NOTICE of ASSESSMENT, CMC should have filed protest w/n 60d from receipt ofsaid letter, i.e. 60d from June 10 = Aug10. But since none was filed, assessment deemed final andexecutory.

San Juan v. CastroF: San Juan conveyed by Deed of Assignment real properties in Marikina City, with consent of wife, to Saints and

Angels Realty Corporation (SARC) in exchange for 258,434 shares of stock in total par value of P2,584,340. 200,000of the said shares of stocks worth P2M were placed in San Juans name while the rest were placed in the name of hiswife.-San Juan wanted to pay transfer tax based on consideration in the Deed of Assignment; Marikina City Treasurerbased transfer tax on propertys FMV-San Juan filed written protest to basis of tax due-Castro replied (through a letter) insisting that FMV is the basis-San Juan filed in RTC Marikina Petition for Mandamus and Damages for failure to perform a ministerial dutyH: DENY MANDAMUS: In accordance with R65.3, ROC, there should be no other plain, speedy and adequateremedy in the ordinary course of law.BUT under Section 195 of LGC, a taxpayer who disagrees with a tax assessment made by a local treasurer mayfile a written protest thereof.***San Juan SHOULD HAVE EITHER:

A. appealedassessment before court of competent jurisdiction (and not petition the court to grant mandamus) OR

B. paid tax then refund

b. Appeal to the regular court of competent jurisdiction2. Claim for refund/tax creditSec. 196. Claim for Refund of Tax Credit.a. file WRITTEN CLAIM FOR REFUND/CREDIT with local treasurerb.Proceed with COURT ACTION w/n2yrs from date the taxpayer is entitled to a refund/credit3. Contesting the validity of a new tax ordinanceSec. 186. Power To Levy Other Taxes, Fees or Charges.-LGUs MAY EXERCISE power to levy TFC or charges

-LIMITS:1. NIRC2. other applicable laws3. TFC shall not be unjust, excessive, oppressive, confiscatory or contrary to declared national policy4. ordinance levying such taxes, fees or charges shall not be enacted without any prior public hearingconducted for the purpose.

Sec. 187. Procedure for Approval and Effectivity of Tax Ordinances and Revenue Measures; MandatoryPublic Hearings.PROCEDURE: in accordance with LGCPUBLIC HEARINGS: conducted for the purpose [of approving tax ordinance]If QUESTION on CONSTITUTIONALITY/LEGALITY of tax ordinance/revenue measures: APPEAL w/n 30d fromeffectivity TO SOJ>SOJ render deci on appeal w/n 60d from date of receipt of appeal> Appeal SHALL NOT HAVE EFFECT OF SUSPENDING THE EFFECTIVITY OF THE ORDINANCE + ACCRUAL +

PAYMENT OF TFC


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WHEN aggrieved party may file with court of competent jurisdiction:a. w/n 30d after receipt of SOJ decib. after 60d from appeal w/SOJ, SOJ did not act on appeal

Sec. 188. Publication of Tax Ordinances and Revenue Measures.WHEN: Within (10) days after their approvalHOW: certified true copies of all provincial, city, and municipal tax ordinances or revenue measures shall be

published in full

for 3 consecutive daysin a newspaper of local circulation (in lieu thereof: post at 2 conspicuous + publicly accessible places)

Sec. 189. Furnishing of Copies of Tax Ordinances and Revenue Measures. Bigay copy to local treasurers forpublic dissemination.

Sec. 190. Attempt to Enforce Void or Suspended Tax Ordinances and Revenue Measures.-after DUE NOTICE of DISAPPROVAL/SUSPENSION of the ordinance/revenue measure-sufficient ground foradministrative disciplinary action against the local officials and employees responsibletherefor.

Sec. 191. Authority of Local Government Units to Adjust Rates of Tax Ordinances.-once every 5 years-shall not exceed 10% of rates under LGC

Sec. 192. Authority to Grant Tax Exemption Privileges.-through ordinances duly approved-what can LGU grant:a. tax exemptionsb. incentivesc. reliefsproviso: under such terms and conditions as they may deem necessary.

Sec. 193. Withdrawal of Tax Exemption Privileges.GR: tax exemptions/incentives granted to/presently enjoyed WITHDRAWN upon effectivity of the LGCX: a. local water districtsb. cooperatives duly registered under RA 6938c. non-stock and non-profit hospitals and educational institutions

Figuerres vs. CAF: Belen Figuerres owns parcel of land in Mandaluyong. She received a notice of assessment from Mandaluyongassessor in 1993. The assessment, effective in 1994, was based on Ordinance Nos. 119 and 125, series of 1993,and Ordinance No. 135, series of 1994, of the Sangguniang Bayan of Mandaluyong.Ordinance No. 119 contains a schedule of fair market values of the different classes of real property in themunicipality.Ordinance No. 125 fixes the assessment levels applicable to such classes of real property.Ordinance No. 135 amended Ordinance No. 119, 6 byproviding that only one third (1/3) of the increase in themarket values applicable to residential lands pursuant to the said ordinance shall be implemented in the years 1994,1995, and 1996.-prohibition suit in CA vs. assessor + treasurer + sangguniang bayan: stop from enforcing ordinancesalleged that ordinances were INVALID for having been adopted WITHOUT:

a. public hearingsb.

prior publicationCA: denied

*~*~*~*WON exhaustion of administrative remedies obtains under the circumstances.YES-remedy available w/n admin machinery: give admin agency the opportunity to decide the matter correctly + preventunnecessary and premature resort to courstREMEDIES available to TAXPAYER:a. S187,LGC: question constitutionality/legality on appeal w/n 30d from effectivity of ordinance TO SOJ(mandatory)b. S226, LGC: taxpayer not satisfied with assessment of his property: appeal to Board of Assessment Appeals

w/n60d from notice of assessmentc. S252, LGC: question excessiveness of amt of tax:i.pay firstii. request annotation of the phrase paid under protestiii. appealto BAA by petitionunder oathwith copies of tax declarations + affidavits + documents supporting his appealWON the City Council of Mandaluyong is empowered to determine and approve the aforecited ordinanceswithout taking into account the mandatory public hearings required by the LGC. NO-prior public hearing MANDATORY-in this case: Presumption of validity of ordinances not rebutted by Figuerras as she merely asserted that no publichearings were conducted when she has the burden of proving the illegality of the passage of the ordinance

WON there is a need for publication of tax ordinances.YES. S188-presumption of validity in favor of the ordinances NOT rebutted by Figuerras, as she did not present any evidencesto prove her claim.

*Municipality of Mandaluyong presented evidence (testimonial, documentary) to prove that there was prior hearingsand publication.

Hagonoy Market Vendor Assn. v. Municipality of HagonoyF: Hagonoy enacted Kautusan Blg. 28 on Oct. 1996, increasing stall rentals of market vendors in Hagonoy. Art. 3provided it would take effect upon approval. The ordinance was posted from Nov. 4-25, 1996.-Petitioner Assns members werepersonally given copies on Nov. 1997-Dec1997:petitioners president appealed with the SoJ(over a year after its approval) assailing its constitutionalityand claiming it was unaware of the posting. Respondent contended that the ordinance took effect in Oct. 1996 byoperation of law and that the appeal was time-barred.SOJ: (1) ordinances effectivity retroacted to the date of its approval(2) the appeal was filed beyond the 30 day limitfrom the date of approval.

MFR: Denied by SOJ appealed with CACA: denied for formal deficiencies. 2nd MFR deniedWON petitioners appeal was already time-barred.YESH: Sec. 187, LGC periods ARE MANDATORY. Here, they only appealed with SOJ in Dec1997, more than 1 yr afterordinance took effect.

Coca-Cola Philippines v. City of ManilaNATURE: Petition for Review on Certiorariunder Rule 45

FACTSF: Coke maintains a sales office in Manila. City of Manila approved Tax Ordinance No. 7988-Tax Ordinance No. 7988("Revised Revenue Code of the City of Manila"):increased the tax rates applicable tocertain establishments operating within the territorial jurisdiction of the City of Manila; S21, in effect, imposedadditional business tax on businesses that are already subject to business tax-Coke filed petition before SOJ contesting legality of Tax Ordinance

*power of LGUs to tax limited in 186 so power to grant exemption and privileges also subject to these limitations


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SOJ: declared Tax ordinance null and void without legal effect: failed to meet publication requirement, as thesaid ordinance was ONLY PUBLISHED ONCE IN THE MAY 22 ISSUE OF THE PHILIPPINE POST (instead of 3consecutive days in a newspaper of local circulationBLGF: issued directive that City of Manila cease and desist from enforcing said tax ordinance-STILL, respondents continued to assess petitioner business tax for the year 2001 based on the tax rates prescribedunder Tax Ordinance No. 7988. SO Coke filed a Complaint with the RTC Manila praying that respondents beenjoined from implementing the aforementioned tax ordinance.-During the pendency of the said case, the City Mayor of Manila approved Tax Ordinance No. 8011 ("An Ordinance

Amending Certain Sections of Ordinance No. 7988.")-Coke CHALLENGED AGAIN said ordinance before SOJ not likewise published upon its approvalSOJ: 2nd Tax Ordinance ALSO null and voidRTC: amendatory ordinance cured defect of first ordinanceH: BOTH ORDINANCES NULL AND VOID-Tax Ordinance No. 7988:null and void as said ordinance was published only for one dayin the 22 May 2000issue of the Philippine Post-amendatory ordinance (Tax Ordinance 8011): null and void. Cannot amend nor cure a law which is void,nonexistent in the first place.

a. When a taxpayer can contest the legality of a tax ordinance: 30d from effectivityb. Appeal to the SoJ: 60d to decidec. Appeal to a court of competent jurisdiction

II. Real Property TaxA. Assessment/Collection1. Assessment of Land ValueSec. 219. General Revision of Assessments and Property Classification.-within 2y after the effectivity of this Code-every 3y thereafter

Sec. 220. Valuation of Real Property.(a) real property is declared and listed for taxation purposes for the first time;(b) there is an ongoing general revision of property classification and assessment; or(c) a request is made by the person in whose name the property is declaredthe provincial, city or municipal assessor /duly authorized deputy shall, in accordance with the provisions of thisChapter, make a classification, appraisal and assessment of the real property listed and described in thedeclaration irrespective of any previous assessment or taxpayer's valuation thereon

assessment shall not be increased oftener than once every 3 yearsX: when new improvements substantially increasing the value of said property or of any change in its actual use(even if not yet 3 years, new valuation could be made)

Sec. 221. Date of Effectivity of Assessment or Reassessment.RE/ASSESSMENT: EFFECTIVITYmade after the January 1: January 1 of the succeeding yearmade within 90d from date of SPECIAL CAUSE: beginning of quarter next following the reassessmentSPECIAL CAUSES

a. partial/total destructionb. major change in actual usec. any great and sudden inflation/deflation of RP valuesd. gross illegality of assessment when madee. any other abnormal clause

Sec. 222. Assessment of Property Subject to Back Taxes.Liable for max 10 years prior to the date of initial assessment

taxes computed on the basis of the applicable schedule of values in force during the corresponding period

WHEN NO INTEREST FOR DELINQUENCY IMPOSED: Taxes paid on or before the end of the quarter followingthe date the notice of assessment was received by the owner or his representativeINTEREST: 2% pm or a fraction thereof from the date of the receipt of the assessment until such taxes are fully paid.

Sec. 223. Notification of New or Revised Assessment.WHEN:

a. real property is assessed for the first timeb. an existing assessment is increased or decreased

within thirty (30) daysWHO: assessorWHAT: give written notice of such new or revised assessmentto the person in whose name the property isdeclared.DELIVERY OF NOTICE: personally/registered mail/through the assistance of the punong barangay to the last knownaddress of the person to be served

Sec. 224. Appraisal and Assessment of Machinery.(a) BRAND NEW: FMV = acquisition costIF OLD: FMV = (remaining economic life/estimated economic life) x replacement/reproduction cost(b) IMPORTED:FMV = acquisition cost + freight + insurance + bank and other charges + brokerage + arrastre andhandling + duties and taxes + plus cost of inland transportation + handling + installation charges at the present site.The cost in foreign currency of imported machinery shall be converted to peso coston the basis of foreign currencyexchange rates as fixed by the Central Bank.

Sec. 225. Depreciation Allowance for Machinery.RATE: max 5% of original cost/replacement cost/reproduction cost for every year of useRemaining value: FIXED at MIN 20% of original/replacement/reproduction cost so long as the machinery is useful andin operation

2. Collection of RPTSec. 246. Date of Accrual of Tax. on the first (1st) day of January from that date it shall constitute a lien on the propertywhich shall be superior to any other lien, mortgage, orencumbrance of any kind whatsoever, and shall be extinguished only upon the paymentof the delinquent tax.

Sec. 247. Collection of Tax. responsibility of the city or municipal treasurer concernedcity/municipal treasurer may deputize brgy treasurer (collect taxes on RP located in brgy) + brgy treasurerPROPERLY BONDED + Premium on bond paid by city/municipal govt

Sec. 248. Assessor to Furnish Local Treasurer with Assessment Roll.WHEN: on or before the thirty-first (31st) day of December each yearCONTENTS:

a. list of all persons whose real properties have been newly assessed or reassessedb. values of such properties

Sec. 249. Notice of Time for Collection of Tax.Whose duty: city/municipal treasurerWHEN:

a. basic RPT + SEF: on or before the thirty-first day of January each yearb. any other tax: on date prescribed by the sanggunian concerned

WHAT: the notice of the dates when the tax may be paid without interestWHERE:

a. at a conspicuous and publicly accessible place at the city or municipal hallb. published in a newspaper of general circulation in the locality once a week for two (2) consecutive weeks


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a. Payment in installmentsSec. 250. Payment of Real Property Taxes in Installments.a. BASIC RPT + SEF: 4 equal installments (without interest)1st: due and payable on or before Mar312nd: due and payable on or before June303rd: due and payable on or before Sept304th: due and payable on or before Dec31* Payments of real property taxes shall first be applied to prior years delinquencies, interests, and penalties, ifany, and only after said delinquencies are settled may tax payments be credited for the current period.b. special levy, other tax: depends on the ordinance if it allows installments

b. Condonation of TaxSec. 276. Condonation or Reduction of Real Property Tax and Interest.WHEN: a. general failure of crops

b. substantial decrease in the price of agricultural or agribased productsc. calamity in any province, city, or municipality

WHO: the sanggunian concernedHOW: by ordinance passed prior to the first (1st) day of January of any year + recommendation of the LocalDisaster Coordinating Council-wholly or partially condone the taxes and interest for the succeeding year or years in the city or municipalityaffected by the calamity

Sec. 277. Condonation or Reduction of Tax by the President of the Philippines.WHEN: when public interest so requiresSCOPE: in any province or city or a municipality within the Metropolitan Manila Area.-any year rin

c. Reduction/DiscountSec. 251. Tax Discount for Advanced Prompt Payment.-paid RPT + SEF in advance-discount: max 20% of annual tax due

d. REMEDIES OF GOVERNMENT to collectSec. 254. Notice of Delinquency in the Payment of the Real Property Tax.(a) RPT/any other tax became delinquent.

-provincial/city/municipal treasurer IMMEDIATELY CAUSE a notice of delinquency to be POSTED

WHERE TO POST: i. at the main entrance of the provincial capito/city or municipal hall ; ORii. a publicly accessible and conspicuous place in each barangay of the local government unit concerned; ANDiii. published once a week for 2 consecutive weeks, in a newspaper of general circulation in the

province/city/municipality.(b) CONTENTS:i. date upon which the tax became delinquentii. personal property may be distrained to effect paymentiii. (payment to stay public auction; sale in lieu thereof; right to redemption): any time before the distraint ofpersonal property, payment of the tax + surcharges+ interests + penalties may be made in accordance with thenext following Section, and unless the tax, surcharges and penalties are paid before the expiration of theyear for which the tax is due, the delinquent RP will be sold at public auction and title to property will bevested in purchaser, subject to right of redemption w/n 1yr from date of saleX: when notice of assessment/or special levy is contested administratively or judicially

Sec. 255. Interests on Unpaid Real Property Tax.

failed to pay the basic RPT or any other tax levied under this Title

>upon the expiration of the periods as provided in Section 250>when dueInterest imposed: 2% pm on the unpaid amount or a fraction thereof, until the delinquent tax shall have beenfully paidTOTAL interest SHALL NOT EXCEED 36m

Sec. 256. Remedies For The Collection Of Real Property Tax.a. levy on real propertyb. judicial action.Sec. 257. Local Government's Lien.-basic RPT and any other tax under the title constitute a lien on property subject to tax.superior to all liens, charges or encumbrances in favor of any personirrespective of the owner or possessor thereofenforceable by administrative or judicial actionEXTINGUISH upon payment of the tax and the related interests and expenses.

Sec. 258. Levy on Real Property.WHEN:After the expiration of the time required to pay the basic RPT or any other tax levied under this TitleHOW: issuance of a warrant on/before/simultaneously with the institution of the civil action for the collection ofthe delinquent tax+ duly authenticatedcertificateWHO issues: provincial/city treasurer, or treasurer of a municipality within the Metropolitan Manila AreaCONTENTS of CERTIFICATE:i. name of the delinquent owner of the property/person having legal interest thereinii. the description of the propertyiii. the amount of the tax dueiv. the interest thereon*warrant shall operate with the force of a legal execution throughout the province, city or a municipalitywithin the Metropolitan Manila AreaDELIVERY OF WARRANT:a. TO THE DELINQUENT OWNER/TAXPAYERi. mailed to /served upon the delinquent owner of the real property/person having legal interest thereinii. in case he is out of the country or cannot be located, the administrator or occupant of the propertyb. TO ASSESSOR and REGISTRAR OF DEEDS (w/ attached written notice of the levy)i. assessor annotate the levy on the tax declarationii. registrar annotate the levy on the certificate of title of the propertyREPORT of levying officer:submitted to sanggunianw/n 10d after receipt of the warrant BY OWNER/person having legal interest therein

Sec. 259. Penalty for Failure to Issue and Execute Warrant.i. criminal prosecutionii. administrativeiii. judicial procedingWHO liable: LOCAL TREASURER/DEPUTY FAILSFor what:

i. failure to issue warrant of levy w/n 1yr from time tax becomes dueii. failure to execute the warrant of levy w/n 30d from issuanceiii.guilty of abusing exercise of powerConsequence: DISMISSAL FROM SERVICE

Sec. 260. Advertisement and Sale.WHEN: Within thirty (30) days after service of the warrant of levyWHO: the local treasurer

HOW:


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a. ADVERTISEMENTWHERE:

i. main entrance of the provincial/city/municipal building; andii. publicly accessible and conspicuous place in the brgy where the real prop is locatediii.publication once a week for 2 weeks (no consecutive?) in a newspaper of general circulation in the

province/city/municipalityCONTENTS OF ADVERTISEMENT:

i. amount of delinquent taxii. interest dueiii.expenses of the saleiv.date and place of salev. name of the owner of the real property/person having interest thereinvi.description of the real property to be sold

STAY OF SALE: owner of real property/person having legal interest therein PAY the delinquent tax + interestdue + expenses of saleb. SALEWHERE:

i. main entrance of the provincial/city/municipal buildingii. on property to be soldiii.any other place as specified in the notice of the sale

REPORT OF SALE:by local treasurer/deputyto sanggunian concernedform part of local treasurers recordCERTIFICATE OF SALEby local treasurerCONTENTS:

i. name of purchaserii. description of the property soldiii.amount of the delinquent taxiv.interest due on taxv. expenses of salevi.brief description of the proceedings

PAG SOBRA PROCEEDS: remit to owner of prop/person having legal interest thereonADVANCE on AMT OF COSTS OF COLLECTION:by local treasurerthru ordinance duly approvedincludes costs of collection, advertisement, sale

Sec. 261. Redemption of Property Sold.PERIOD: Within one (1) year from the date of saleBY WHOM: the owner of the delinquent real property/person having legal interest therein, or his representativeHOW: payment to local treasurer of amt of delinquent tax + interest (not more than 2%pm on purchase pricefrom date of sale to date of redemption)EFFECT:

i. invalidate the certificate of sale issued to the purchaserii. owner of the delinquent real property/person having legal interest therein shall be entitled to a certificate

of redemption which shall be issued by the local treasurer or his deputy.iii. local treasurer return to purchaser the entire amount paid + interest max 2% pm; after: property shall be

free from lien of tax + interest due + expenses of sale*DELINQUENT OWNER still remain in possession/entitled to income of fruits of the real prop from the date ofsale until the expiration of the period of redemption

Sec. 262. Final Deed to Purchaser.

WHEN: Failure to redeem property

HOW: local treasurer execute DEED CONVEYING TO PURCHASER PROPERTY FREE FROM LIEN OFDELINQUENT TAX, INTEREST, EXPENSES OF SALEDeed briefly state theproceedings upon which the validity of the sale rests

Sec. 263. Purchase of Property By the Local Government Units for Want of Bidder. In case there is nobidder for the real property advertised for sale as provided herein, or if the highest bid is for an amountinsufficient to pay the real property tax and the related interest and costs of sale the local treasurer conductingthe sale shall purchase the property in behalf of the local government unit concerned to satisfy the claim andwithin two (2) days thereafter shall make a report of his proceedings which shall be reflected upon the recordsof his office. It shall be the duty of the Registrar of Deeds concerned, upon registration with his office of anysuch declaration of forfeiture to transfer the title of the forfeited property to the local government unit concernedwithout the necessity of an order from a competent court.

Within one (1) year from the date of such forfeiture, the taxpayer or any of his representative, may redeem theproperty by paying to the local treasurer the full amount of the real property tax and the related interest and thecosts of sale. If the property is not redeemed as provided herein, the ownership thereof shall be fully vested onthe local government unit concerned.

Sec. 264. Resale of Real Estate Taken for Taxes, Fees, or Charges. The sanggunian concerned may, byordinance duly approved and upon notice of not less than twenty (20) days, sell and dispose of the realproperty acquired under the preceding Section at public auction. The proceeds of the sale shall accrue to thegeneral fund of the local government unit concerned.

Sec. 265. Further Distraint or Levy. Levy may be repeated if necessary until the full amount due, includingall expenses, is collected.

Sec. 266. Collection of Real Property Tax Through the Courts. The local government unit concerned mayenforce the collection of the basic real property tax or any other tax levied under this Title by civil action in anycourt of competent jurisdiction. The civil action shall be filed by the local treasurer within the period prescribedin Section 270 of this Code.

Sec. 267. Action Assailing Validity of Tax Sale.taxpayer deposit with court first the amount for which the real property was sold + interest 2%pm from date ofsale to time of institution of action

AMOUNT DEPOSITED:i. if deed is declared invalid: give to purchaser at the auction sale (dib a dapat government magsoli nun?

Bakit kukunin kay taxpayer?)ii. if action fails: soli kay depositor/taxpayer

NO INVALIDITY OF PUBLIC AUCTION based on irregularities/informalities in proceedings UNLESS

substantive rights of the delinquent owner of the real property/person having legal interest therein have beenimpaired

Sec. 268. Payment of Delinquent Taxes on Property Subject of Controversy.ACTION: involves ownership/possession of/succession to real propertyAWARDHow: motu propio/upon representationof the provincial/city/municipal treasurer/deputyWhat: ownership/possession/successionWhen: upon payment to the court of the taxes with interest due on the property and all other costs that mayhave accrued, subject to the final outcome of the action

Sec. 269. Treasurer to Certify Delinquencies Remaining Uncollected.What:i. certified list of all real property tax delinquencies which remained uncollected or unpaid forat least

one (1) year in his jurisdiction

ii. statement of the reason or reasons for such non-collection or non-payment


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..local treasurer submit to the sanggunian concernedon or before the December 31 of the year immediately succeeding the year in which the delinquencies wereincurred + request for assistance in the enforcement of the remedies for collection provided herein.

Sec. 270. Periods Within Which to Collect Real Property Taxes.a. Basic RPT and any other tax levied: within five (5) years from the date they become due. No action for

the collection of the tax, whether administrative or judicial, shall be instituted after the expiration of suchperiod.

b. fraud or intent to evade payment of the tax: within ten (10) years from the discovery of such fraud orintent to evade payment.

SUSPENSION OF PRESCRIPTIVE PERIOD:(1) The local treasurer is legally prevented from collecting the tax;(2) The owner of the property or the person having legal interest therein requests for reinvestigation andexecutes a waiver in writing before the expiration of the period within which to collect; and(3) The owner of the property or the person having legal interest therein is out of the country or otherwisecannot be located.

Sps. Ramon and Rosita Tan v. BanteguiNATURE

The case is a Petition for Review under Rule 45 assailing the Decision and Resolution of the Court of Appeals

FACTS

F: Bantegui owns a property which was rented out to Sps Caedo. She left Philippines 1954 and returned 1988,

executed her SPA in favor of her sister Guadalupe Bautista, and went back to US-1st sale: Taxes paid ONLY UNTIL 1977. Taxes from 1978- 1983 NOT PAID so CITY TREASURER SOLD at public

auction the properties to Sps CAPISTRANO for P10k only. Certificate of Sale subsequently issued

NOTE: no warrant to Bantegui of said delinquency, no notice of sale to Bantequi nor her representative

-Property not redeemed w/n 1yr redemption period so TITLE CONSOLIDATED TO SPS CAPISTRANOS. Sps

Capistranos NEVER took possessionof land, NEVER INFORMED Caedos about the sale, NEVER collected rent from

Caedos nor PAID RPT on property

-2nd Sale: Capistranos later sold to Sps Pereyra (daughter of the Caedos) for P60k. PEREYRAS DID NOT TAKE

POSSESSION OF PROPERTY BUT MORTGAGED IT to Imus Rural Bank. Mortgaged annotated to title

*TRANSFERS UNKNOWN TO Bantegui, Caedos, nor Bautista (rep)

Bantegui EVEN APPLIED for ADMINISTRATIVE RECONSTITUTION OF HER TITLE (lost in a fire) WHICH WAS

GRANTED

EVEN paid RPT on property for 1987 to 1989. Her payment was only refused 1990

-3rd Sale: Pereyras to Sps Tan, Sps Tan paid P300k to Rural Bank of Imus, paid overdue taxes and other expenses.

TAN ALSO DID NOT TAKE IMMEDIATE POSSESSION OF THE PROPERTY, ONLY INFORMED OCCUPANTS OFTITLE TO LAND in 1990 and then demanded Caedos to vacate property

-Sps Tan filed action for ejectment, WON

-Caedo appealed to CA, remanded by CA to TC: Caedos FAILED TO APPEARso declared in default, was

subsequently ejected from property, then their house on the property DEMOLISHED

-Bantegui thru atty-in-fact Bautista + Caedos filed a complaint for annulment of sale + quieting of title +

injunction + damages w/ RTC they won!

-Sps Tan appealed to CA; CA affirmed TC: Sps Tan WERE NOT PURCHASERS IN GF, NO BETTER RIGHT TO

THE SUBJECT PROPERTY: (1) auction sale tainted with irregularities: NO Notice of delinquency + NO NOTICE OF

SALE sent to Bantequi nor Bautista; (2) Owner continued to pay RPT even after sale; (3) Selling price inadequate +

would render sale grossly inadequate, in itself would render sale VOID; (4) THEY NEVER took possession, paid RPT,

informed lessees of title, never collected rent from Caedos

H: AUCTION SALE VOID

*NO DUE PROCESS: DID NOT FOLLOW STEPS PRESCRIBED BY LAW (PD 464, Real Property Tax Code),

THUS, SALE IS INVALID

1. NO NOTICE OF DELINQUENCY, NO NOTICE OF SALE given to the delinquent owner nor representative

Re: TCT: should have nevertheless be invalidated as failure to comply with the requirements of a proceeding in

personam (thus would affect the rights of the real parties in interest), Sps Tan would have no better title than

that of the original owner

Re Gross inadequacy of price as means for delinquent owner to redeem property more easily: BUT delinquent owner

was NEVER GIVEN OPPORTUNITY TO REDEEM THE PROPERTY!

2. ONLY PROOF to show validity of sale was RTC QC resolution confirming the final bill of sale of Capistranos (NO

REPORT OF THE LOCAL TREASURER)

3. Balance of the proceeds were never returned to Bantequi or Bautista (representative) after issuance of final bill ofsale, SHOWING APPARENT IRREGULARITY NOT ONLY IN THE CONDUCT OF THE TAX SALE and

SUBSEQUENT DISPOSITION

4. NOT INNOCENT PURCHASERS: no investigation despite awareness of defects in their title, NONE attempted to

exercise possession, NONE paid RPT

5. Banteque remained in continuous possession of the owners copy of the CTC, even allowed to reconstitute title

and NO ATTEMPT TO HAVE THEM CANCELLED

B. Taxpayers Remedies1. Contesting the assessment of land valueSec. 226. Local Board of Assessment Appeals.WHO: Any owner or person having legal interest in the property who is not satisfied with the action of the

provincial, city or municipal assessor in the assessment of his property mayWHEN: within sixty (60) days from the date of receipt of the written notice of assessmentWHAT TO DO: appeal to the Board of Assessment Appeals (BAA) of the provincial or cityHOW: filing a petition under oath in the form prescribed for the purpose, together with copies of the tax declarationsand such affidavits or documents submitted in support of the appeal.

Sec. 227. Organization, Powers, Duties, and Functions of the Local Board of Assessment Appeals.(a) COMPOSITION OF BAA: Registrar of Deeds (chairman) + Mems: the provincial/city prosecutor + theprovincial/city engineer as membersserve in an ex officio capacitywithout additional compensation(b) The chairman of the Board shall have the power to designate any employee of the province or city to serve assecretary to the Board also without additional compensation.

(c) The chairman and members of the Board of Assessment Appeals of the province or city shall assume theirrespective positions without need of further appointment or special designation immediately upon effectivity of this

Code. They shall take an oath or affirmation of office in the prescribed form.

(d) In provinces and cities without a provincial or city engineer, the district engineer shall serve as member of theBoard. In the absence of the Registrar of Deeds, or the provincial or city prosecutor, or the provincial or city engineer,or the district engineer, the persons performing their duties, whether in an acting capacity or as a duly designatedofficer-in-charge, shall automatically become the chairman or member, respectively, of the said Board, as the casemay be.

Sec. 228. Meetings and Expenses of the Local Board of Assessment Appeals. (a) The Board of AssessmentAppeals of the province or city shall meet once a month and as often as may be necessary for the prompt dispositionof appealed cases. No member of the Board shall be entitled to per diems or traveling expenses for his attendance inBoard meetings, except when conducting an ocular inspection in connection with a case under appeal.

(b) All expenses of the Board shall be charged against the general fund of the province or city, as the case may be.The sanggunian concerned shall appropriate the necessary funds to enable the Board in their respective localities to

operate effectively.


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Sec. 229. Action by the Local Board of Assessment Appeals. (a) The Board shall decide the appeal within onehundred twenty (120) days from the date of receipt of such appeal. The Board, after hearing, shall render its decisionbased on substantial evidence or such relevant evidence on record as a reasonable mind might accept as adequateto support the conclusion.

(b) In the exercise of its appellate jurisdiction, the Board shall have the power to summon witnesses, administeroaths, conduct ocular inspection, take depositions, and issue subpoena and subpoena duces tecum. Theproceedings of the Board shall be conducted solely for the purpose of ascertaining the facts without necessarilyadhering to technical rules applicable in judicial proceedings.

(c) The secretary of the Board shall furnish the owner of the property or the person having legal interest therein andthe provincial or city assessor with a copy of the decision of the Board. In case the provincial or city assessor concursin the revision or the assessment, it shall be his duty to notify the owner of the property or the person having legalinterest therein of such fact using the form prescribed for the purpose. The owner of the property or the person havinglegal interest therein or the assessor who is not satisfied with the decision of the Board may, within thirty (30) daysafter receipt of the decision of said Board, appeal to the Central Board of Assessment Appeals, as herein provided.The decision of the Central Board shall be final and executory.

Sec. 230. Central Board of Assessment Appeals. The Central Board of Assessment Appeals shall be composed ofa chairman and two (2) members to be appointed by the President, who shall serve for a term of seven (7) years,without reappointment. Of those first appointed, the chairman shall hold office for seven (7) years, one member forfive (5) years, and the other member for three (3) years. Appointment to any vacancy shall be only for the unexpiredportion of the term of the predecessor. In no case shall any member be appointed or designated in a temporary or

acting capacity. The chairman and the members of the Board shall be Filipino citizens, at least forty (40) years old atthe time of their appointment, and members of the Bar or Certified Public Accountants for at least ten (10) yearsimmediately preceding their appointment. The chairman of the Board of Assessment Appeals shall have the salarygrade equivalent to the rank of Director III under the Salary Standardization Law exclusive of allowances and otheremoluments. The members of the Board shall have the salary grade equivalent to the rank of Director II under theSalary Standardization Law exclusive of allowances and other emoluments. The Board shall have appellate

jurisdiction over all assessment cases decided by the Local Board of Assessment Appeals.

There shall be Hearing Officers to be appointed by the Central Board of Assessment Appeals pursuant to civil servicelaws, rules and regulations, one each for Luzon, Visayas and Mindanao, who shall hold office in Manila, Cebu Cityand Cagayan de Oro City, respectively, and who shall serve for a term of six (6) years, without reappointment untiltheir successors have been appointed and qualified. The Hearing Officers shall have the same qualifications as thatof the Judges of the Municipal Trial Courts.

The Hearing Officers shall each have the salary grade equivalent to the rank of Director I under the Salary

Standardization Law exclusive of allowances and other emoluments. The Hearing Officers shall try and receiveevidences on the appealed assessment cases as may be directed by the Board.

The Central Board of Assessment Appeals, in the performance of its powers and duties, may establish and organizestaffs, offices, units, prescribe the titles, functions and duties of their members and adopt its own rules andregulations.

Unless otherwise provided by law, the annual appropriations for the Central Board of Assessment Appeals shall beincluded in the annual budget of the Department of Finance in the corresponding General Appropriations Act.

Sec. 231. Effect of Appeal on the Payment of Real Property Tax. Appeal on assessments of real property madeunder the provisions of this Code shall, in no case, suspend the collection of the corresponding realty taxes on theproperty involved as assessed by the provincial or city assessor, without prejudice to subsequent adjustmentdepending upon the final outcome of the appeal.

a. Appeal to the Local board of Assessment Appeals (LBAA)

Systems Plus Computer College v. Caloocan CityFACTS- Systems Plus Computer College is a non-stock and non-profit educational institution organized and established in1997. As such, it enjoys property tax exemption from the local government on its buildings but not on the parcels ofland which Systems Plus is renting for P5,000 monthly from its sister companies, Consolidated Assembly and PairManagement and Development Corporation.- Systems Plus requested Caloocan city government to extend tax exemption to the parcels of land claiming that thesame were being used actually, directly and exclusively for educational purposes.

- City government denied the request on the ground that the subject parcels of land were owned by Consolidated Assembly and Pair Management which derived income therefrom in the form of rentals and other local taxesassumed by the Systems Plus.- Systems Plus and the Consolidated Assembly and Pair Management entered into separate agreements which ineffect novated their existing contracts of lease on the subject parcels of land and converted them to donations of thebeneficial use thereof.- Systems Plus wrote City Assessor informing the latter of the new agreements and seeking a reconsideration ofearlier denial of the application for tax exemption. They no longer received income by way of rentals from the subjectproperties, accompanied by the corresponding board resolutions, Again, the application was denied.- Systems Plus filed a petition for mandamus with RTC which, however, dismissed it for being premature. Its timelymotion for reconsideration having been denied, Systems Plus filed the instant petition for certiorari imputing graveabuse of discretion on the part of the trial court when it ruled: (1) that mandamus does not lie and (2) that SystemsPlus failed to exhaust available administrative remedies.

ISSUE

WON mandamus is the proper remedy

HELDNO. Under Section 226 of RA 7160,[12] the remedy of appeal to the Local Board of Assessment Appeals is availablefrom an adverse ruling or action of the provincial, city or municipal assessor in the assessment of property.- The Systems Plus cannot bypass the authority of the concerned administrative agencies and directly seek redressfrom the courts even on the pretext of raising a supposedly pure question of law without violating the doctrine ofexhaustion of administrative remedies.- Hence, when the law provides for remedies against the action of an administrative board, body, or officer, as in thecase at bar, relief to the courts can be made only after exhausting all remedies provided therein.- Before seeking the intervention of the courts, it is a precondition that Systems Plus should first avail of all the meansafforded by the administrative processes.- Besides, mandamus does not lie against the respondent City Assessor in the exercise of his function of assessingproperties for taxation purposes. While its duty to conduct assessments is a ministerial function, the actual exercisethereof is necessarily discretionary.

- Mandamus may not be availed of to direct the exercise of judgment or discretion in a particular way, or toretract or reverse an action already taken in the exercise of either.

b. Appeal to the Central Board of Assessment Appeals (CBAA)Caltex v. CBAPFACTS- Caltex was assessed realty tax on machinery & equipment installed in its gas stations on leased lands.(underground tanks, elevanted tanks, elevated water tanks, water tanks, gasoline pumps, etc.)- Those are loaned by Caltex to gas station operators under lease agreement. The operators must return them. Thelessor of the land doesnt become the owner of the machines & equipment.- City Assessor of Pasay said those are taxable realty. City Board of Tax Appeals said theyre personalty.- Assessor appealed to Central Board of Assessment Appeals.- Central Board of Assessment Appeals said theyre real prop.- Caltex filed this certiorari petition.- The Solicitor General contends that the CTA has exclusive appellate jurisdiction over the case. and hence

ISSUE


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1. WON CTA has exclusive jurisdiction2. WON the equipment / machineries are real or personal property

HELD

1. No. The Solicitor General's contention that the Court of Tax Appeals has exclusive appellate jurisdiction over thiscase is not correct. \A hen Republic Act No. 1125 created the Tax Court in 1954, there was as yet no Central Board of

Assessment Appeals. Section 7(3) of that law in providing that the Tax Court had jurisdiction to review by appeal

decisions of provincial or city boards of assessment appeals had in mind the local boards of assessment appeals butnot the Central Board of Assessment Appeals which under the Real Property Tax Code has appellate jurisdiction overdecisions of the said local boards of assessment appeals and is, therefore, in the same category as the Tax Court.

Section 36 of the Real Property Tax Code provides that the decision of the Central Board of Assessment Appealsshall become final and executory after the lapse of fifteen days from the receipt of its decision by the appellant, Withinthat fifteen-day period, a petition for reconsideration may be filed. The Code does not provide for the review of theBoard's decision by this Court.

Consequently, the only remedy available for seeking a review by this Court of the decision of the Central Board ofAssessment Appeals is the special civil action of certiorari, the recourse resorted to herein by Caltex (Philippines),Inc.

2.REAL PROP- bec as appurtenances to the gas station, theyre necessary to the operation of the gas station.

- bec improvements on land are commonly taxed as realty even though for some purposes they might beconsidered personalty. Standard Oil v. Jaramillo

Chavez v. OngpinNATUREPetition seeking to declare unconstitutional EO 73

FACTS- EO 73 (November 25, 1986) which provided for collection of real property taxes based on 1984 real property values,under section 21 of the real property tax code as amended

WHEREAS- collection of real property taxes is still based on the 1978 revision of property values- latest general revision of real property assessments completed in 1984 has rendered the 1978 revised values

obsolete- collection of real property taxes based on the 1984 real property values was deferred to take effect on January 1,1988 instead of January 1, 1986, thus depriving the local government units of an additional source of revenue- urgent need for local governments to augment their financial resources to meet the rising cost of renderingeffective services to the peopleDO HEREBY ORDER(1) Real property values as of December 31, 1984 as determined by the local assessors during the latest generalrevision of assessments shall take effect beginning January 1, 1987 for purposes of real property tax collection

- MEMO ORDER 77 issued suspending implementation of EO 73 until June 30, 1987-Chavez (taxpayer and owner of 3 parcels of land) alleges

> EO 73 accelerated the application of the general revision of assessments to January 1, 1987 thereby mandatingexcessive increase in real property taxes by 100% to 400% on improvements and up to 100% on land> any increase in the value of real property brought about by the revision of real property values and assessmentswould necessarily lead to a proportionate increase in real property taxes> sheer oppression is the result of increasing real property taxes at a period of time when harsh economic

conditions prevail

> increase in the market values of real property as reflected in the schedule of values was brought about only byinflation and economic recession

- Realty Owners Association of the Philippines, Inc. (ROAP) (national association of owners-lessors) joinsChavez and additionally alleges> PD 464 is unconstitutional as it imposes an additional one percent (1%) tax on all property owners to raise funds foreducation, as real property tax is admittedly a local tax for local governments> General Revision of Assessments does not meet the requirements of due process as regards publication, notice ofhearing, opportunity to be heard as it authorizes "replacement cost" of buildings (improvements) which is not providedin PD 464, but only in an administrative regulation of the Department of Finance> Joint Local Assessment/Treasury Regulations No. 2-86 is even more oppressive and unconstitutional as it imposessuccessive increase of 150% over the 1986 tax

ISSUEWON EO 73 is unconstitutional as regards the revision of the assessments and effectivity thereof

HELDNO- no legal basis on attacking EO 73 since the general revision of assessments is a continuing process mandated byPD 464 Sec 21 (make a general revision of real property assessments once every five years and if property valuesgreatly change, with approval of Sec Fin, make gen revision before the fifth year).- Furthermore, PD 464 furnishes thePROCEDURE BY WHICH A TAX ASSESSMENT MAY BE QUESTIONED1) Within 60 days from the date of receipt of the written notice of assessment, any owner who doubts the assessmentof his property, may appeal to the Local Board of Assessment Appeals with petition under oath, copies of the tax

declarations and documents in support of the appeal (Sec 30). Decision shall be made within 120 days from receipt ofappeal (Sec 34).2) In case the owner or administrator of the property or the assessor is not satisfied with the decision of the LocalBoard of Assessment Appeals, he may, within 30 days from the receipt of the decision, appeal to the Central Board of

Assessment Appeals (Sec 34)3) The Central Board will decide within 12 months from date of receipt.The decision of the Central Board of

Assessment Appeals shall become final and executory after the lapse of 15 days from the date of receipt of thedecision (Sec 36).- without EO 73, the basis for collection of real property taxes will still be the 1978 revision of property values.Certainly, to continue collecting real property taxes based on valuations arrived at several years ago, in disregard ofthe increases in the value of real properties that have occurred since then, is not in consonance with a sound taxsystem. Fiscal adequacy, which is one of the characteristics of a sound tax system, requires that sources of revenuesmust be adequate to meet government expenditures and their variations.

DispositionPetition DISMISSED

Cagayan Robina Sugar Milling v. CANATUREPetition for certiorari decision of CA (dismissing petition for certiorari of Cagayan Robina)

FACTS- Cagayan Robina Sugar Milling (Robina for short) was the highest bidder for the properties of Cagayan Sugar Milling,whose properties were foreclosed and held for auction by the Asset Privitization Trust (APT). APT set floor bid priceat P355million. Robina acquired the properties for P464million. Among the properties acquired were machinerieslocated in the millsite of Cagayan Milling- shortly after, the provincial assessor sent a notice of assessment of real property to Robina, covering themachineries installed in the millsite, based on the market value of P391.6m and assessed value of P313.3m- Robina appealed to the LBAA, contending that the assessment should not be based on the APT-set floor bid pricealone, but should also consider other pricing factors like goodwill and future business potential.- LBAA affirmed the assessment of the provincial assessor, but modified the amount (it used the APT-set floor bid

price then deducted the value of all other properties not covered by the assessment) to market value of P260m and


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assessed value of P208m. Resolution was given April 1, 1992, and given to Robina on April 18, 1992.- Robina then prepared an appeal to the CBAA, but it was only on November 1992 that the same was filed in theCBAA. Naturally, the LBAA and provincial assessor moved to dismiss for being time-barred (past the 30-day periodfor appeal to CBAA). CBAA dismissed- Robina filed (actually with SC, but SC referred to CA) a petition on certiorari against CBAA. CA upheld the dismissaland denied the petition. Hence, the present petition

ISSUE1. WON there was any error in dismissing the appeal of Robina

HELD1. NORatio Robina failed to show that the use by the LBAA and CBAA of the APT floor bid price, pursuant to Sec.3(n) ofthe RPTC was incorrect and done in bad faith. The method used by the LBAA and CBAA cannot be deemederroneous since there is no rigid rule for the valuation of property, which is affected by a multitude of circumstancesand which rules could not foresee nor provide for. LBAA and CBAA were not precluded from adopting variousapproaches to value determination, including adopting the APT floor bid price for Robinas properties. Further, theappeal was time-barredReasoningNote that the real property tax being assessed and collected here is for 1990. Hence, the applicable lawis the Real Property Tax Code (PD464), and not the Local Government Code (RA7160).-the main contention of Robina is that the method by which the LBAA arrived at the assessment is not sanctioned bylaw, insofar as the RPTC provides a formula for reaching market value of machineries, viz: (remaining economicvalue/ economic life) x replacement cost (sec. 28, RPTC)- however, sec.28 must be read in consonance with sec.3(n) of RPTC, which defines market value. Here, LBAA and

CBAA are not precluded from adopting various approaches to value determination, including adopting the APT "floorbid price" for the properties-Valuation on the basis of a floor bid price is not bereft of any basis in law. One of the approaches to value is theSales Analysis Approach or the Market Data Approach where the source of market data for valuation is from offer ofsales or bids of real property. Valuation based on the floor bid price belongs to this approach, pursuant to Section3(n)- Worthy of note, Robina has not shown that the current market value of its properties would be significantly lower ifits proposed formula is adopted. A party challenging an appraiser's finding of value is required not only to prove thatthe appraised value is erroneous but also what the proper value is.- further, the appeal to the CBAA was time-barred. The RPTC provides: Where the owner or administrator of aproperty or an assessor is not satisfied with the decision of the LBAA, he may, within 30days from the receipt of thedecision, appeal to the CBAA.- Robina had only until May 18, 1992, to appeal the local board's resolution to the CBAA. However, it only filed itsappeal with the CBAA on November 25, 1992, way beyond the period to perfect an appeal. No error was committedby CBAA when it dismissed petitioner's appeal for having been filed out of time and CA was correct in affirming the

dismissal.- Robina contends that the appeal period doesnt apply in this case because of the rule that an assessment of aprovincial assessor that is void ab initio, the prescriptive period to appeal to the LBAA is suspended. However, thisargument is off-tangent as the appeal found to be time-barred in this case is the appeal to the CBAA, not to the LBAA.- Well-entrenched is the rule that the perfection of an appeal within the period therefor is both mandatory and

jurisdictional, and that failing in this regard renders the decision final and executory.DispositionPetition is denied. Decision affirmed

2. Payment of RPT under ProtestSec. 252. Payment Under Protest.(a) No protest shall be entertained unless the taxpayer first pays the tax. There shall be annotated on the tax receiptsthe words "paid under protest". The protest in writing must be filed within thirty (30) days from payment of the tax tothe provincial, city treasurer or municipal treasurer, in the case of a municipality within Metropolitan Manila Area, whoshall decide the protest within sixty (60) days from receipt.

(b) The tax or a portion thereof paid under protest shall be held in trust by the treasurer concerned.

(c) In the event that the protest is finally decided in favor of the taxpayer, the amount or portion of the tax protestedshall be refunded to the protestant, or applied as tax credit against his existing or future tax liability.(d) In the event that the protest is denied or upon the lapse of thesixty-day period prescribed in subparagraph (a),the taxpayer may avail of the remedies as provided for in Chapter 3, Title Two, Book II of this Code.

Manila Electric Company v. BarlisFACTS:-MERALCO erected four (4) power generating plants in Sucat, Muntinlupa which it declared in its tax declarations

including the buildings thereon and the machineries and equipment therein. From 1975 to 1978 MERALCO paid thereal property taxes on the said properties on the basis of their assessed value as stated in the tax declarations.MERALCO sold all the power-generating plants including the landsite to the NAPOCOR.-In 1985, the Offices of the Municipal Assessor and Municipal Treasurer of Muntinlupa discovered, that MERALCO,for the period beginning 1 January 1976 to 29 December 1978, misdeclared and/or failed to declare for taxationpurposes a number of real properties, consisting of several equipment and machineries, found in the said powerplants. These machineries were reflected in the Deed of Sale.-The Municipal Assessor of Muntinlupa then declared and assessed the subject real properties for taxation purposes.. The Municipal Treasurer of Muntinlupa issued several collection notices to MERALCO, ordering it to pay thedeficiency in the real property taxes covering the machineries and equipment found in the said power plants.MERALCO did not pay.-BLGF-DOF conducted a number of hearings with both MERALCO and the Municipality of Muntinlupa participatingand issued a Letter-Endorsement declaring MERALCO liable to pay the deficiency or delinquent real property taxesclaimed by the Municipality.-Municipal Treasurer Eduardo A. Alon forwarded a supplemental collection notice to MERALCO demanding the

immediate payment of 36 Million pesos of unpaid real property taxes inclusive of penalties and accrued interest.In addition, Municipal Treasurer Alon also sent a formal letter to MERALCO reiterating his demand for tax payment.Again, MERALCO did not pay.-Accordingly, after issuing the requisite certification of non-payment of real property taxes and complying with theadditional requirement of public posting of the notice of delinquency, Municipal Treasurer Eduardo A. Alon issuedwarrants of garnishment, copies of which were served on MERALCO on 10 October 1990, ordering the attachment ofthe bank deposits of MERALCO with the Philippine Commercial and Industrial Bank (PCIB), Metropolitan Bank andTrust Company (METROBANK) and the Bank of the Philippine Islands (BPI) to the extent of its unpaid real propertytaxes.-MERALCO filed before the RTC of Makati, Metro Manila a Petition for Prohibition with Prayer for Writ of PreliminaryMandatory Injunction and/or Temporary Restraining order (TRO) praying, among others, that a TRO be issued toenjoin the Municipal Treasurer of Muntinlupa from enforcing the warrants of garnishment.-RTC issued a TRO which was modified to the effect that the warrants of garnishment against the bank accounts shallbe in full force and effect, provided, that the Municipal Treasurer shall not in the meantime collect, receive or withdrawthe frozen bank deposits; and that MERALCO can withdraw from the frozen deposits provided that it does not leave abalance less than the tax claim of the Municipality of Muntinlupa.-Municipal Treasurer filed a Motion to Dismiss on the grounds of: (1) lack of jurisdiction since, under Sec. 64of the Real Property Tax Code, courts are prohibited from entertaining any suit assailing the validity of a taxassessed thereunder until the taxpayer shall gave paid, under protest, the tax assessed against himISSUE:WON RTC has jurisdiction over a petition for prohibition which seeks to set aside the warrants of garnishment overthe bank deposits of petitioner MERALCO without payment under protest of the tax assessed as required in Sec. 64of the Real Property Tax CodeHELD:No. The trial court has no jurisdiction to entertain a Petition for Prohibition absent petitioner's payment, under protest,of the tax assessed as required by Sec. 64 of the RPTC. Payment of the tax assessed under protest, is a conditionsine qua non before the trial court could assume jurisdiction over the petition and failure to do so, the RTC has no

jurisdiction to entertain it.The restriction upon the power of courts to impeach tax assessment without a prior payment, under protest, of thetaxes assessed is consistent with the doctrine that taxes are the lifeblood of the nation and as such their collectioncannot be curtailed by injunction or any like action; otherwise, the state or, in this case, the local government unit,

shall be crippled in dispensing the needed services to the people, and its machinery gravely disabled.


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Emerlinda Talento v. Escalada and PetronNATURE

Certiorari under Rule 65 of the Rules of Court assailing the November 5, 2007 Order of the Regional Trial Court ofBataan, Branch 3 granting the petition for the issuance of a writ of preliminary injunction in favor of Petron

FACTS

On June 18, 2007, Petron received from the Provincial Assessors Office of Bataan a notice of revised assessmentover its machineries and pieces of equipment in Lamao, Limay, Bataan.

Petron was given a period of 60 days within which to file an appeal with the Local Board of Assessment Appeals(LBAA). Based on said revised assessment, petitioner Provincial Treasurer of Bataan issued a notice informingPetron that as of June 30, 2007, its total liability is P1,731,025,403.06, representing deficiency real property tax duefrom 1994 up to the first and second quarters of 2007.

On August 17, 2007, Petron filed a petition with the LBAA contesting the revised assessment on the grounds that(1) the subject assessment pertained to properties that have been previously declared;(2) and that the assessment covered periods of more than 10 years which is not allowed under the LocalGovernment Code (LGC). According to Petron, the possible valid assessment pursuant to Section 222 of the LGCcould only be for the years 1997 to 2006.

Petron further contended that the fair market value or replacement cost used by petitioner included items whichshould be properly excluded; that prompt payment of discounts were not considered in determining the fair marketvalue; and that the subject assessment should take effect a year after or on January 1, 2008. In the same petition,Petron sought the approval of a surety bond in the amount of P1,286,057,899.54.

On August 22, 2007, Petron received fro

remedies under local government code

Documents