Commissioner of Internal Revenue vs. AlgueInc. GR No.L-28896 Februar !"# !988Facts: Private respondent is a domestic corporation engaged inconstruction, received a letter from petitioner assessinganamount (P83, 183.85) asdelinquent incometaxescovering to !ears. Four da!s later, private respondentfiledaletter of protest or request for reconsideration,"ic" as stamp and received #! on t"e same da! #!t"e petitioner. $arrant of distraint and lev! aspresented to t"e private respondent t"roug" its counsel"o refused to receive it on t"e ground of t"e pendingprotest. %ounselt"en as finall! informed t"at t"e &'(ill not ta)e an! action on t"e protest, privaterespondent t"enacceptedt"earrant of distraint andlev!.%"ronolog! s"os t"at t"e petition as filedseasona#l!. $ccording to (ep. $ct *o. 11+5, t"e appealma! #e made it"in t"irt! da!s after receipt of t"edecision or ruling c"allenged.'t is true t"at as a rule t"earrant of distraint and lev! is ,proof of t"e finalit! of t"eassessment, and renders "opeless a request forreconsideration,, #eing ,tantamount to an outrig"t denialt"ereof and ma)es t"e said request deemedre-ected., &ut t"ere is a special circumstance in t"e caseat #ar t"at prevents application of t"is accepted doctrine.Private respondent filed a petition for revieof t"edecision of %'(it" t"e %.$. ."e /atter found forprivate respondent, petitioner raise t"e issue #efore t"e0%.'ssue:1"et"er or not t"e procedure utili2ed #! %'( astaxing aut"orit! proper3 (uling: *o, t"e government for its part, is expected to respond int"e form of tangi#le and intangi#le #enefits intended toimprove t"e lives of t"e people and en"ance t"eir moralandmaterial values. ."iss!m#ioticrelations"ipist"erationaleof taxationands"oulddispel t"eerroneousnotion t"at it is an ar#itrar! met"od of exaction #! t"osein t"e seat of poer. &ut even as e concede t"einevita#ilit! and indispensa#ilit! of taxation, it is arequirement in all democratic regimes t"at it #eexercised reasona#l! and in accordance it" t"eprescri#ed procedure. 'f it is not, t"en t"e taxpa!er "as arig"t tocomplainandt"ecourtsill t"encometo"issuccor. For allt"e aesome poer of t"e tax collector,"e ma! still #e stopped in "is trac)s if t"e taxpa!er candemonstrate, as it "as "ere, t"at t"e la "as not #eeno#served.1CIR v $o%o &'i((ingGR L-682)2*a 26# !99)FAC$&+.o)!o 0"ipping is represented in t"e P"ils #! 0oriamont0teams"ip $genc! "ic" ons 456 7ardenia.*$08.($ c"artered 456 7ardenia to load ra sugar int"e P"ilippines. ."us, 0oriamont $genc! paid t"erequired income and common carrier9s taxes #ased ont"e expected gross receipts of t"e vessel. :oever,uponarriving, at 7uimarasPort of 'loilo, t"evesselfound no sugar for loading.&utstill,*$08.($and 0oriamont $genc! mutuall! agreed to "ave t"evessel sail for ;apan it"out an! cargo.:avingpaidt"eincomeandcommoncarrier*t"eprivaterespondent isentitledtoarefund or tax credit for amounts representing pre?pa!ment of incomeandcommoncarrier9staxesundert"e *ational 'nternal (evenue %ode, section +@ (#) (+),as amended..-L/+ Aes, it s"ould #e refunded. ."e tax as paid a!#ac) in 1B8C and despite t"e clear s"oing t"at it aserroneousl! paid, t"e government succeeded in dela!ingitsrefundfor fifteen(15) !ears.$fter fifteen(15) long!ears and t"e expenses of litigation, t"e mone! t"at ill#e finall! refunded to t"e private respondent is -ust ort"a damaged nic)el. Fair deal is expected #! our taxpa!ers from t"e &'( andt"edut!demandst"at &'(s"ouldrefundit"out an!unreasona#ledela!"at it "aserroneousl!collected.>ur ruling in Roxas v. Court of Tax Appeals is aproposto recall:."e poer of taxation is sometimes called also t"epoer to destro!. ."erefore it s"ould #e exercised it"caution to minimi2e in-ur! to t"e proprietar! rig"ts ofataxpa!er. 't must #e exercised fairl!, equall! anduniforml!, lest t"e tax collector )ill t"e ,"en t"at la!s t"egolden egg., $nd, in order to maintain t"e generalpu#lic9s trust andconfidenceint"e7overnment t"ispoer must #e used -ustl! and not treac"erousl!.201I vs. Court of A((eals# et. al.!22283A(ril !2# 2333Facts: Petitioner,"avingpaidinexcessitsit""oldingtaxes in 1B8B, "ad a refunda#le amount of P+BD,@B+. 'tindicated in t"e same 1B8B 'ncome .ax (eturn t"at t"erefunda#le amount as to #e applied as tax credit for t"esucceedingtaxa#le!ear. Petitioner, "oever, didnotappl! t"etax credit inits 1BBC'ncome.ax (eturn,claiming t"at it incurred #usiness losses. 'nstead, itnotified t"e &'( t"at it ould claim P11+,@B1.BC of t"erefunda#le amount as tax refund. 0u#sequentl!, it filed apetition for revie it" t"e %ourt of .ax $ppeals see)ingt"e refund. (espondents %.$ and %$ denied t"e claim,findingt"at sincepetitioner previousl!declaredt"at itould appl! t"e refund as tax credit, it is presumed to"avealread! done so. ."e!ruled t"atpetitioner failedto overcome t"e said presumption "en it did notpresent as evidence its 1BBC 'ncome .ax (eturn toesta#lis" t"e fact t"at it did not credit t"e amount.:ence, t"is Petition for (evie.'ssue: 1"et"er or not t"epetitioner isentitledtot"erefundrepresentingexcess credita#le it""oldingtaxpaid for t"e taxa#le !ear 1B8B.:eld: ."e 0% "as ruled in t"e affirmative. 't isundisputed t"at petitioner as entitled to a refund of t"eexcess it""olding taxes paid #! it for t"e taxa#le !ear1B8B. $nd pursuant to 0ection EB of t"e 1B8E .ax %ode,a corporation entitled to a refund ma! opt eit"er to o#tainsuc" refund or to credit t"e said amount for t"esucceeding taxa#le !ear. Petitioner presented evidenceto prove its claim t"at it did not appl! t"e amount as taxcredit= ont"eot"er"and, t"erespondent %'(didnotpresent an! evidence or opposition to t"e evidencesupplied #! petitioner..ec"nicalities and legalisms,"oever exalted, s"ould not #e misused #! t"egovernment to )eep mone! not #elonging to it andt"ere#!enric"itself at t"eexpenseof itsla?a#idingciti2ens. 'f t"e0tateexpectsitstaxpa!erstoo#servefairnessand"onest!inpa!ingt"eir taxes, somust itappl! t"e same standard against itself in refundingexcess pa!ments of suc" taxes.31'ili((ine 0an% of Communications vs CIRGR !!23224an. 28# !999Facts:Petitioner reported a net loss in 1B8E and t"us declaredno tax pa!a#le. >n 1B8D, petitioner requested t"erespondent, among ot"ers, for a tax credit representingt"e overpa!ment of taxes in t"e first and secondquarters of 1B85.."ereafter, petitioner filed a claim for refund of credita#letaxes it""eld #! t"eir lessees from propert! rentals in1B85 and in 1B8E. Pending investigation, petitionerinstituted a Petition for (evie #efore t"e %ourt of .ax$ppeals (%.$).%.$ denied t"e request of petitioner for a tax refund orcredit for 1B85 on t"e ground t"at it as filed #e!ond t"eto?!earreglementar!periodprovidedfor#!la. ."epetitionerrder no. D3 dated *ovem#er +5,1B8E, accelerated t"eapplicationof t"egeneral revisionof assessmentsto;anuar! 1,1B8D t"ere#! mandating an excessiveincreaseinreal propert!taxes#!1CCLto@CCLonimprovements, and up to 1CCLon land= t"at an!increase in t"e value of realpropert! #roug"t a#out #!t"erevisionof real propert!valuesandassessmentsouldnecessaril!leadtoaproportionateincreaseinrealpropert! tax= t"at s"eer oppression is t"e result ofincreasing real propert! taxes at a period of time "en"ars" economic conditions prevail= and t"at t"e increasein t"e mar)et values of real propert! as reflected in t"esc"edule of values as #roug"t a#out onl! #! inflationand economic recession.'ntervenor(ealt! >ners $ssociation of t"e P"ilippines,'nc. ((>$P) -oins %"ave2 in "is petition to declareunconstitutional K> D3.'ssue: 1"et"er or not Kxecutive >rder no. D3 is in consonanceof t"e principle of a sound tax s!stem.:eld:*o, Kxecutive >rder D3 is in consonance it" t"eprinciple of a sound tax s!stem.."e #asis for collection of realpropert!taxes as stillt"e 1BD3 revision of propert! values. %ertainl!, tocontinue collecting real propert! taxes #ased onvaluations arrived at several!ears ago, in disregard oft"eincreasesint"evalueof real propertiest"at "aveoccurred since t"en, is not in consonance it" a soundtax s!stem. Fiscal adequac!, "ic" is one of t"ec"aracteristics of a sound tax s!stem, requires t"atsources of revenues must #e adequate to meetgovernment expenditures and t"eir variations.51.IL-9 *INING C8R18RA$I8N vs. CIR7.(. *o. 1+5DC@$ugust +8, 1BB8F$%.0:."e%ourt of .ax$ppealsorderedP"ilextopa!t"eamount of P11C, EDD,EE8.5+ as excise tax lia#ilit! for t"eperiod from t"e +nd quarter of 1BB1 to t"e +nd quarter of1BB+ plus +CL annual interest from $ugust E, 1BB@ untilfull! paid. P"ilex refused to pa! and argued t"at it "adpending claims for 6$. input credit5refund for t"e taxes itpaid for t"e !ears 1B8B?1BB1 in t"e amount ofP11B,BDD,C3D.C+plusinterest andt"erefores"ould#eapplied against t"e said excise tax lia#ilities in a mannerof a set?off or legal compensation.'008K:1>*taxescould#et"esu#-ect of aset?off or legalcompensation3(8/'*7:*o. .axes could not #e t"e su#-ect of a set?off or legalcompensation for t"e simple reason t"at t"e governmentand t"e taxpa!er are not mutual creditors and de#tors ofeac" ot"er. %laims for taxes are neit"er de#ts norcontracts. $taxpa!er cannot refusetopa!"istaxes"en t"e! fall due simpl! #ecause "e "as a claimagainst t"e government t"at t"e collection of t"e tax iscontingent on t"e result of t"e lasuit it filed against t"egovernment. 'n t"e case at #ar, t"e claims of P"ilex for6$. refund is still pending litigation. 4oreover, taxes aret"e life#lood of t"e government and s"ould #e collectedit"out unnecessar! "indrance. %iting Francia v.'ntermediate $ppellate %ourt, t"e 0% categoricall! "eldt"at taxes cannot #e su#-ect to set?off or compensation,t"us=?e "ave consistentl! ruled t"at t"ere can #e no off ?settingof taxesagainst t"eclaimst"at t"etaxpa!erma! "ave against t"e government. $person cannotrefuse to pa! a tax on t"e ground t"at t"e governmentoes"imanamount equal toorgreatert"ant"etax#eingcollected. ."ecollectionof taxcannot aait t"eresults of a lasuit against t"e government.6Geroc'i# et al vs. /e(artment of -nerg# et alGR No. !)9"964ul !"# 233"Facts:."e Klectric Poer 'ndustr! (eform act of +CC1ot"erise )non as (KP'($) as enacted #! t"econgress on ;une 8, +CC1 and too) effect on ;une +E,+CC1. 't soug"t to impose a universal c"arge on all end?users of electricit! for t"e purpose of funding*$P>%>(7%%) contends t"at unli)e a tax "ic" is imposed toprovide income for pu#lic purposes, suc" as support oft"e government, administration of t"e la, or pa!ment ofpu#lic expenses, t"e assailed 8niversal %"arge is leviedfor a specific regulator! purpose, "ic" is to ensure t"evia#ilit! of t"e countr!9s electric poer industr!. ."us, itisexacted#!t"e0tateint"eexerciseof itsin"erentpolice poer. >n t"is premise, P0$/4su#mits t"att"ere is no undue delegation of legislative poer to t"eK(% since t"e latter merel! exercises a limited aut"orit!or discretion as to t"e execution and implementation oft"e provisions oft"eKP'($.(espondents Hepartmentof Knerg! (H>K), K(%, and *P%, t"roug" t"e >ffice oft"e 0olicitor 7eneral(>07), s"are t"e same vie t"att"e 8niversal %"arge is not a tax #ecause it is levied foraspecificregulator!purpose, "ic"istoensuret"evia#ilit! of t"e countr!9s electric poer industr!, and is,t"erefore, an exaction in t"e exercise of t"e 0tate9spolice poer.'ssue:1"et"er or not t"euniversal c"argeimposedunder 0ec.3@ of t"e KP'($ is a tax:eld5(uling:*o, t"e universal c"arge imposed under sec. 3@of t"e KP'($ is not a tax. 't is an exaction in t"e exerciseof t"estate.$sageneral rule, t"epoer totaxisanincident ofsovereignt! and is unlimited in its range, ac)noledginginitsver!naturenolimits, sot"at securit!against itsa#useisto#efoundonl!int"eresponsi#ilit!of t"elegislature"ic"imposest"etaxont"econstituenc!"o is to pa! it. 0o potent indeed is t"e poer t"at it asonce opined t"at t"e poer to tax involves t"e poer todestro!. Petitioner claims t"at t"e assessed H0. to date"ic" amounts to P3DE million .'t is a! #e!ond its netort" of P+5B million.J(espondent never disputed t"eseassertions. 7iven t"e realities on t"e ground, imposingt"e H0. on petitioner ould #e "ig"l! oppressive. 't isnot t"epurposeof t"egovernment tot"rottleprivate#usiness. >n t"e contrar!, t"e government oug"t toencourageprivate enterprise. Petitioner, -ust li)e an!concern organi2ed for a laful economic activit!, "as arig"t to maintain a legitimate #usiness.9CIR v. Lingaen Gulf -lectric 1o' provides:F."e $dministrator of t"e Fertili2er Pesticide $ut"orit! toinclude in its fertili2er pricing formula acapitalcontri#utioncomponent of not lesst"an P 1Cper #ag.."is capital contri#ution s"all #e collected until adequatecapital is raised to ma)e PP' via#le. 0uc" capitalcontri#ution s"all#e applied #! Fertili2er and Pesticide$ut"orit! (FP$) to all domestic sales of fertili2ers in t"eP"ilippines.GPursuant to t"e />', Fertip"il paid P1C for ever! #ag offertili2er it sold in t"e domestic mar)et to t"e FP$. $ftert"e 1B8E Kdsa (evolution, FP$ voluntaril! stopped t"eimposition of t"e P1C lev!. 1it" t"e return of democrac!,Fertip"il demanded from PP' a refund of t"e amounts itpaid under />' *o. 1@E5, #ut PP' refused to accede tot"e demand.I&&,-+ />' 1@E5, &K'*7$/$1'4P/K4K*.KHF>(.:KP8(P>0K >F $008('*7 .:K FK(.'/'NK( 08PP/A$*HH'0.('&8.'>*'*.:K%>8*.(A, $*HF>(&K*KF'.'*7 $ F>8*H$.'>* %(K$.KH &A /$1 .>:>/H '* .(80. F>( 4'//'>*0 >F F$(4K(0 .:K'(0.>%O >1*K(0:'P '* PP' %>*0.'.8.K0 $ 6$/'H/K7'0/$.'>*P8(08$*. .>.:K KPK(%'0K >F.$P$.'>* F>( P8&/'% P8(P>0K0.R,LING+ *o, ."e P1C lev! is unconstitutional #ecause it as notfor apu#licpurpose. ."elev!asimposedtogiveundue #enefit to PP'.First, t"e />' expressl! provided t"at t"e lev! #eimposed to #enefit PP', a private compan!. 0econd, t"e/>' providest"at t"eimpositionof t"eP1Clev!asconditional and dependent upon PP' #ecomingfinanciall! ,via#le., ."is suggests t"at t"e lev! asactuall! imposed to #enefitPP'. ."e />' nota#l! doesnot fix a maximum amount "en PP' is deemedfinanciall!,via#le., 1orse, t"elia#ilit!of Fertip"il andot"er domestic sellers of fertili2er to pa! t"e lev! is madeindefinite. ."ird, t"e(.%andt"e%$"eldt"at t"eleviespaidundert"e />' eredirectl!remittedanddeposited#!FP$ to Far Kast &an) and .rust %ompan!, t"edepositar! #an) of PP'.Fourt", t"e lev! as used to pa! t"e corporate de#ts ofPP'.$n in"erent limitation on t"e poer of taxation is pu#licpurpose. .axesareexactedonl!forapu#licpurpose.."e! cannot #e used for purel! private purposes or fort"e exclusive #enefit of private persons. ."e reason fort"isissimple.."epoertotaxexistsfort"egeneralelfare= "ence, implicit in its poer is t"e limitation t"at its"ould #e used onl! for a pu#lic purpose. 't ould #e aro##er! for t"e 0tate to tax its citi2ens and use t"e fundsgenerated for a private purpose. $s an old 8nited 0tatescase #luntl! put it: ,.o la! it" one "and, t"e poer oft"e government on t"e propert! of t"e citi2en, and it"t"eot"er to#estoit uponfavoredindividualstoaidprivate enterprises and #uild up private fortunes, isnonet"elessaro##er!#ecauseit isdoneunder t"eforms of la and is called taxation.G."e term ,pu#lic purpose, is not defined. 't is an elasticconcept t"at can #e "ammered to fit modern standards.;urisprudencestates t"at ,pu#lic purpose, s"ould#egiven a #road interpretation. 't does not onl! pertain tot"ose purposes "ic" are traditionall! vieed asessentiall! government functions, suc" as #uilding roadsand deliver!of #asic services,#utalsoincludest"osepurposes designed to promote social -ustice. ."us,pu#licmone!ma!no#eusedfor t"erelocationofillegalsettlers, lo?cost"ousingandur#anoragrarianreform.1"ilet"ecategoriesof "at ma!constituteapu#licpurpose are continuall! expanding in lig"t of t"eexpansion of government functions, t"e in"erentrequirement t"at taxes can onl! #e exacted for a pu#licpurpose still stands. Pu#lic purpose is t"e "eart of a taxla. 1"en a tax la is onl! a mas) to exact funds fromt"e pu#lic "enits true intentistogiveundue #enefitand advantage to a private enterprise, t"at la illnotsatisf! t"e requirement of ,pu#lic purpose.G18Gracia =Garcia> vs. -:ecutive &ecretar# et. al.!3!2";4ul ;# !992Facts: Petitioner congressman assails t"e validit! ofKxecutive >rders *os. @D5 and @D8, t"e said lasimposing, aside fromot"er duties, taxes and ot"erc"argesimposed#!laonall importedarticles, anadditional 5L tax. ."is additional dut! as su#sequentl!increasedtoBL#ut t"esameincreasedamount istoappl! onl! to crude oil and oil products. Petitioner arguest"at t"e questioned las are unconstitutional and inviolationof 0ection@of $rticleEof t"e%onstitution"ic" provides t"at appropriation, revenue or tariff #ills,#ills aut"ori2ing increase of t"e pu#lic de#t, #ills of localapplication, and private #ills s"all originate exclusivel! int"e :ouse of (epresentatives, #ut t"e 0enate ma!propose or concur it" amendments. $nd since%ongress is to #e t"e exclusive source of suc" las, t"ePresident couldnot "avevalidl! issued t"eassailedrevenue?generating measures.'ssue: 1"et"er or not t"e President ma! not issue t"eenactment of appropriation, revenue and tariff #ills, andt"att"e saidareexclusivel! it"int"eprovince of t"elegislative.:eld: ."e 0% "as ruled in t"e negative. 0ection +8(+) of$rticle E of t"e %onstitution provides t"at t"e %ongressma!, #! la, aut"ori2e t"e President to fix it"inspecified limits tarrif rates and ot"er duties. ."us, t"ereis explicit constitutional permission for %ongress toaut"ori2e t"e President ,su#-ect to suc" limitations andrestrictions(it) ma!impose),, it"0ection1C@of t"e.ariff and %ustoms %ode as t"e relevant congressionalstatute.19$olentino vs. $'e &ecretar of FinanceGR !!)2))Aug. 2)# !992Facts:."e value?added tax (6$.) is levied on t"e sale, #arteror exc"ange of goods and properties as ellas on t"esale or exc"ange of services. ($ DD1E see)s to ident"e tax #ase of t"e existing 6$. s!stem and en"ance itsadministration #! amending t"e *ational 'nternal(evenue %ode. ."ere are various suits c"allenging t"econstitutionalit! of ($ DD1E on various grounds.>ne contention is t"at ($ DD1E did not originateexclusivel! in t"e :ouse of (epresentatives as required#! $rt. 6', 0ec. +@ of t"e %onstitution, #ecause it is infact t"e result of t"e consolidation of + distinct #ills, :.*o. 111BD and 0. *o. 1E3C. ."ere is also a contentiont"at 0. *o. 1E3C did not pass 3 readings as required #!t"e %onstitution.'ssue:1"et"er or not ($ DD1E violates $rt. 6', 0ecs. +@ and+E(+) of t"e %onstitution :eld:."e argument t"at ($ DD1E did not originate exclusivel!in t"e :ouse of (epresentatives as required #! $rt. 6',0ec. +@of t"e%onstitutionill not #ear anal!sis. .o#egin it", it is not t"e la #ut t"e revenue #ill "ic" isrequired#!t"e%onstitutiontooriginateexclusivel!int"e :ouse of (epresentatives. .o insist t"at a revenuestatute and not onl! t"e #ill "ic" initiated t"e legislativeprocessculminatingint"eenactment of t"elamustsu#stantiall! #e t"e same as t"e :ouse #ill ould #e toden! t"e 0enaterdinance *o. E53D is null and void for#eing purel! tax or revenue measure since it isregulator! in nature.(uling:Aes, >rdinance *o. E53D is null and void. >rdinance *o.E53D is void #ecause it does not contain or suggest an!standard or criterion to guide t"e ma!or in t"e exerciseof t"epoer "ic""as#eengrantedto"im#!t"eordinance.."e contention t"at >rdinance *o. E53D is not a purel!tax or revenue measure #ecause its principal purpose isregulator! in nature "as no merit. 1"ile it is true t"at t"efirst part "ic"requirest"at t"ealiens"all secureanemplo!ment permit from t"e 4a!or involves t"e exerciseof discretion and -udgment in t"e processing andapprovalor disapprovalof applications for emplo!mentpermits and t"erefore is regulator! in c"aracter t"esecondpart "ic"requirest"epa!ment of P5C.CCasemplo!ee9s fee is not regulator! #ut a revenue measure.."ere is no logic or -ustification in exacting P5C.CC fromaliens "o "ave#eenclearedfor emplo!ment. 't iso#vioust"at t"epurposeof t"eordinanceistoraisemone! under t"e guise of regulation.."e P5C.CC fee is unreasona#le not onl! #ecause it isexcessive #ut #ecause it fails to consider validsu#stantial differences in situation among individualaliens"oarerequiredtopa!it. $lt"oug"t"eequalprotection clause of t"e %onstitution does not for#idclassification, it is imperative t"at t"e classifications"ould #e #ased on real and su#stantial differences"aving a reasona#le relation to t"e su#-ect of t"eparticular legislation. ."esameamount of P5C.CCis#eing collected from ever! emplo!ed alien "et"er "e iscasual or permanent, part time or full time or "et"er "eis a lol! emplo!ee or a "ig"l! paid executive>rdinance *o. E53D does not la! don an! criterion orstandard to guide t"e 4a!or in t"e exercise of "isdiscretion. 't "as #een "eld t"at "ere an ordinance of amunicipalit!failstostatean!polic!or toset upan!standard to guide or limit t"e ma!or9s action, expressesno purpose to #e attained #! requiring a permit,enumeratesnoconditionsfor itsgrant or refusal, andentirel! lac)s standard, t"us conferring upon t"e 4a!orar#itrar!andunrestrictedpoer togrant or den!t"eissuance of #uilding permits, suc" ordinance is invalid,#eing an undefined and unlimited delegation of poer toallo or prevent an activit! per se laful.241rovince of Abra vs .ernan5o.etc.et.al L-29;;6 August ;!# !98!Facts: Private respondent (oman %at"olic &is"op of &angueddesirous of #eing exempted from a real estate tax, t"ere#eing a tax assessment made #! t"e Provincial$ssessor on t"e properties of respondent. ."erespondent failed to ex"aust t"e administrative remediesavaila#le under Presidential Hecree *o. @E@ #efore filingsuc" court action. Furt"er, it as pointed out torespondent ;udge t"at "e failed to a#ide #! t"e pertinentprovisionof suc"Presidential Hecree.( "ic"providesas follos: ,*o court s"all entertain an! suit assailing t"evalidit! of atax assessed under t"is %odeuntil t"etaxpa!er, s"all "ave paid, under protest, t"e taxassessed against "im nor s"all an! court declare an! taxinvalid #! reason ofirregularitiesor informalitiesin t"eproceedings of t"e officers c"arged it" t"e assessmentor collection of taxes, or of failure to perform t"eir dutiesit"int"istime"ereinspecifiedfor t"eir performanceunlesssuc"irregularities, informalitiesor failures"all"ave impaired t"e su#stantial rig"ts of t"e taxpa!er= nors"allan! court declare an! portion of t"e tax assessedunder t"eprovisionsof t"is%odeinvalidexcept uponcondition t"at t"e taxpa!er s"all pa! t"e -ust amount oft"e tax, as determined #! t"e court in t"e pendingproceeding). 'ssue: 1"et"er or not procedural dueprocess asinfringed3 (uling: Aes, Petitioner Province of $#ra is full! -ustified ininvo)ingt"eprotectionof procedural dueprocess. 'ft"ere is an! case "ere proof is necessar! todemonstrate t"at t"ere is compliance it" t"econstitutional provision t"at allos an exemption, t"is isit. 'nstead, respondent ;udgeacceptedat itsfacet"eallegation of private respondent. $llt"at as alleged int"e petition for declarator! relief filed #! privaterespondents, after mentioningcertainparcels of landoned #! it, are t"at t"e! are used ,actuall!, directl! andexclusivel!, assourcesof support of t"eparis"priestand "is "elpers and also of private respondent &is"op.'nt"emotiontodismiss filedon#e"alf of petitionerProvince of $#ra, t"e o#-ection as #ased primaril! ont"e lac) of -urisdiction, as t"e validit! of a taxassessment ma! #e questioned #efore t"e /ocal &oardof $ssessment $ppeals and not it" a court. ."ere asalsomentionof alac)of acauseof action, #ut onl!#ecause, in its vie, declarator! relief is not proper, ast"ere "ad #een #reac" or violation of t"e rig"t ofgovernment to assess and collect taxes on suc"propert!.'t clearl!appears, t"erefore, t"at infailingtoaccord a"earingtopetitioner Province of $#raanddeciding t"e case immediatel! in favor of privaterespondent, respondent ;udgefailedtoa#ide#!t"econstitutional command of procedural due process.25CIR v. Lingaen Gulf -lectric 1ordinance *o. 33B8 of t"e %it! of 4anila, toget"er it"t"e provision of t"e 4anila c"arter aut"ori2ing it, "ic"imposes a municipal occupation tax on personsexercising various professions in t"e cit!, penali2ing non?pa!ment it" a fine of not more t"an to "undred pesosor #! imprisonment of not more t"an six mont"s, or #ot".."e! arguet"att"e ordinanceas illegal and void ont"egroundt"at t"epenalt!providedasnot legall!aut"ori2ed, andt"at it isun-ust andoppressive, andaut"ori2e "at amounts to dou#le taxation.'ssue: 1"et"er or not t"eordinanceandt"ec"arterprovisionaut"ori2ingit constituteclasslegislation, andaut"ori2es "at amount to dou#le taxation.:eld: ."e 0% "as ruled in t"e negative. ."e legislativema!, in its discretion, select "at occupations or certainclasses s"all #e taxed, or "ic" particular cities ormunicipalities s"ould #e empoered to impose taxes inaddition to t"oseimposed #!t"e nationalgovernment.."e argument against dou#le taxation ma! not #einvo)ed "ere one tax is imposed #! t"e state and t"eot"er is imposed #! t"e cit!.27Coconut 8il Refiners Association# Inc vs $orresGR !;2)2"4ul 29# 233)Facts+ ."is is a Petition to en-oin and pro"i#it t"e pu#licrespondent (u#en.orresin"iscapacit!asKxecutive0ecretar! fromalloingot"er private respondents tocontinue it" t"eoperationoftaxanddut!?free s"opslocated at t"e 0u#ic 0pecial Kconomic None (00KN) andt"e %lar) 0pecial Kconomic None (%0KN). ."e petitionersee)s to declare (epu#lic $ct *o. D++D asunconstitutional ont"e ground t"atit alloed onl! tax?free (and dut!?free) importation of ra'(aterials, capital and e)uip(ent. 't reads:T&eSu*icSpecial +cono(ic,ones&all *eoperatedand (anaged as a separate custo(s territor- ensuringfree flo' or (ove(ent of goods and capital 'it&in! intoand exported out of t&e Su*ic Special+cono(ic ,one!as 'ell as provide incentives suc& as tax and dut-.freei(portations of ra' (aterials! capital ande)uip(ent. /o'ever! exportationor re(oval of goodsfro( t&e territor- of t&e Su*ic Special +cono(ic ,one tot&e ot&er parts of t&e 0&ilippine territor- s&all *e su*1ecttocusto(sdutiesandtaxesunder t&eCusto(sandTariff Code and ot&er relevant tax la's of t&e0&ilippines2RA %33%! Sec 13 (*)4.Petitioners contend t"at t"e ording of (epu#lic $ct *o.D++Dclearl! limits t"egrant of taxincentives tot"eimportation of ra'(aterials, capital ande)uip(ent onl!t"ere#! violating t"e equal protection clause of t"e%onstitution.:e also assailed t"e constitutionalit! of Kxecutive >rder*o. BD?$for #eing violative of t"eir rig"t to equalprotection. ."e! asserted t"at private respondentsoperatinginsidet"e00KNarenot different fromt"eretail esta#lis"ments located outside.Issue+ 1"et"er or not (epu#lic $ct *o. D++D is valid ont"e ground t"at it violates t"e equal protection clause..el5:."e 0% ruled in t"e negative. ."e p"rase Stax anddut!?free importations of ra materials, capital andequipment as merel! cited as an example of incentivest"at ma! #e given to entities operating it"in t"e 2one.Pu#lic respondent 0&4$ correctl! argued t"at t"emaxim expressiouniusest exclusioalterius! on"ic"petitioners impliedl! rel! to support t"eir restrictiveinterpretation, does not appl! "en ords are mentioned#! a! of example.."e petition it" respect to declaration ofunconstitutionalit!of Kxecutive>rder *o. BD?$ cannot#e, li)eise, sustained. ."e guarant! of t"e equalprotectionof t"elasisnot violated#!alegislation#ased "ic" as #ased on reasona#le classification. $classification, to#evalid, must (1) rest onsu#stantialdistinction, (+) #e germane to t"e purpose of t"e la, (3)not #e limited to existing conditions onl!, and (@) appl!equall! to all mem#ers of t"e same class. $ppl!ing t"eforegoingtest tot"epresent case, t"is%ourt findsnoviolation of t"e rig"t to equal protection of t"elas. ."ereisasu#stantial distinctionsl!ing#eteent"eesta#lis"mentsinsideandoutsidet"e2one.."ereare su#stantial differences in a sense t"at, investors ill#e lured to esta#lis" and operate t"eir industries in t"eso?called Ssecured area and t"e present #usinessoperatorsoutsidet"earea. ."ereis, t"en, "ardl!an!reasona#le#asistoextendtot"emt"e#enefitsandincentives accorded in (.$. D++D.288R*8C&,GARC8. INC. 6&$R-A&,R-R8F8R*8C CI$A -$ ALL- 2;"92Feb. !"# !968F$%.0:."e municipal &oard of >rmoc passed >rdinance *o. @0eries of 1BE@, imposing F on an! and all productions ofcentrifugalsugar milledat t"e >rmoc 0ugar %ompan!,'nc., in>rmoc%it amunicipal taxequivalent of onepercent per export sale to t"e 8nited 0tates of $mericaand ot"er foreign countries.Pa!ments for said tax ere made, under protest #! saidcompan!, t"e! contested t"e constitutionalit! of said>rdinancefor #eingviolative of t"e equal protectionclause and t"e rule on uniformit! of taxation, aside from#eing an export for#idden tax under 0ection ++8D of t"e(evised $dministrative %ode.'008K:1"et"er or not t"e ordinance violates t"e equalprotection clause.:K/H:$ perusal of t"e requisites on t"e application of t"e ruleon equal protection clause instantl! s"os t"at t"equestioned ordinance does notmeet t"em,for ittaxesonl!t"esugarproduced#!petitioner.."eordinancetaxes onl! centrifugalsugar produced and exported #!t"e >rmoc 0ugar %o. 'nc. and none ot"er. $t t"e time oft"e taxing ordinance as enacted, t"e compan! as t"eonl! sugar central in >rmoc %it!. ."e classification, to #ereasona#le, s"ould #e in terms applica#le to futureconditions as ell. ."e taxing ordinance s"ould not #esingular and exclusive as to exclude an! su#sequentl!esta#lis"ed sugar central of t"e same class as t"epresent compan!, from t"e coverage of t"e tax. $s it isno, even if later a similar compan! is set up, it cannot#e su#-ectto t"e tax #ecause t"eordinanceexpressl!point sonl!tot"e compan!as t"eentit!to#eleviedupon.291.ILI11IN- AIRLIN-& vs. $.- &-CR-$ARA 8FFINANC- 7.(. *o. 11585+, $ugust +5, 1BB@F$%.0: ."e 6alue?$dded .ax I6$.J is levied on t"e sale, #arteror exc"ange of goods and properties as ellas on t"esale or exc"ange of services. 't is equivalent to 1CL oft"e gross selling price or gross value in mone! of goodsor properties sold, #artered or exc"anged or of t"e grossreceipts from t"e sale or exc"ange of services. (epu#lic$ct *o. DD1E see)s to iden t"e tax #ase of t"e existing6$. s!stem and en"ance its administration #! amendingt"e *ational 'nternal (evenue %ode.."ese are various suits for certiorari andpro"i#itionc"allenging t"e constitutionalit! of ($ DD1E:'nt"ecaseat #ar, P$/attac)st"eformal validit!of(epu#lic $ct *o. DD1E. P$/ contends t"at it violates $rt.6', 0ection +EI1J "ic" provides t"at ,Kver! #ill passed#! %ongress s"all em#race onl! one su#-ect "ic" s"all#eexpressedint"etitlet"ereof., 't iscontendedt"atneit"er :. *o. 111BD nor 0. *o. 1E3C provided forremoval of exemption of P$/ transactions fromt"epa!ment of t"e 6$. and t"at t"is as made onl! in t"e%onference %ommittee #ill"ic" #ecame (epu#lic $ct*o. DD1E it"out reflecting t"is fact in its title.."e title of (epu#lic $ct *o. DD1E is:$* $%. (K0.(8%.8('*7 .:K6$/8K?$HHKH .$PI6$.J 0A0.K4, 1'HK*'*7 '.0 .$P &$0K $*HK*:$*%'*7 '.0 $H4'*'0.($.'>*, $*H F>( .:K0KP8(P>0K0 $4K*H'*7 $*H (KPK$/'*7 .:K(K/K6$*. P(>6'0'>*0 >F .:K *$.'>*$/'*.K(*$/ (K6K*8K %>HK, $0 $4K*HKH, $*HF>( >.:K( P8(P>0K0.Furt"ermore, section 1C3 of ($ DD1E states t"efolloing:0ection 1C3. Kxempt .ransactions.? ."e folloing s"all#e exempt from t"e value?added tax:IqJ.ransactions"ic"areexempt underspecial las,except t"ose granted under Presidential Hecree *os. EE,5+B, BD+, 1@B1, 15BC.."e effect of t"e amendment is to remove t"e exemptiongranted to P$/, as far as t"e 6$. is concerned.P"ilippine $irlines IP$/J claimst"atits franc"ise underP.H. *o. 15BC "ic" ma)es it lia#le for a franc"ise tax ofonl! +L of gross revenues ,in lieu of allt"e ot"er feesand c"arges of an! )ind, nature or description, imposed,levied, esta#lis"ed, assessed or collected #! an!municipal, cit!, provincial, or national aut"orit! orgovernment agenc!, noor int"efuture,, cannot #eamended #! (ep. $ct *o. DD1E as to ma)e it IP$/J lia#lefor a 1CL value?added tax on revenues, #ecause 0ec.+@ ofP.H.*o.15BC provides t"atP$/9s franc"isecanonl! #e amended, modified or repealed #! a special laspecificall! for t"at purpose.'008K:1"et"er or not t"is amendment of 0ection 1C3 of t"e*'(% is fairl! em#raced in t"e title of (epu#lic $ct *o.DD1E, alt"oug" no mention is made t"erein of P. H. *o.15BC(8/'*7: ."e court ruled in in t"e affirmative. ."e title states t"att"e purpose of t"e statute is to expand t"e 6$. s!stem,and one a! of doingt"is is to iden its #ase #!it"draing some of t"e exemptions granted #efore. .oinsist t"at P. H. *o. 15BC #e mentioned in t"e title of t"ela, in addition to 0ection 1C3 of t"e *'(%, in "ic" it isspecificall! referred to, ould #e to insist t"at t"e title ofa #ill s"ould #e a complete index of its content.."e constitutional requirement t"at ever! #ill passed #!%ongress s"all em#race onl! one su#-ect "ic" s"all #eexpressed in its title is intended to prevent surprise upont"e mem#ersof%ongress and to informt"e people ofpending legislation so t"at, if t"e! is" to, t"e! can #e"eard regarding it. 'f, in t"e case at #ar, petitioner did not)no #efore t"at its exemption "ad #een it"dran, it isnot #ecause of an! defect in t"e title #ut per"aps for t"esamereasonot"er statutes, alt"oug"pu#lis"ed, passunnoticeduntil someeventsome"o callsattention tot"eir existence.(epu#lic $ct *o. DD1E expressl! amends P$/9sfranc"ise IP. H. *o. 15BCJ #! specificall! excepting fromt"e grant of exemptions from t"e 6$. P$/9s exemptionunder P. H. *o. 15BC. ."is is it"in t"e poer of%ongress to do under $rt. P'', 0ection 11 of t"e%onstitution, "ic" provides t"at t"e grant of a franc"isefor t"e operation of a pu#lic utilit! is su#-ect toamendment, alteration or repeal #! %ongress "en t"ecommon good so requires.30American 0ible &ociet vs. Cit of *anila!3! 1'il ;86Facts:Plaintiff $merican &i#le 0ociet! is a foreign, non?stoc), non?profit, religious, missionar!corporationdul!registered and doing #usiness in t"e P"ilippines t"roug"is P"ilippine agenc!. Hefendant %it! of 4anila is amunicipal corporation it" poers t"at are to #eexercisedinconformit!it"t"eprovisionsof ($ @CB.."e Plaintiff "as #een distri#uting and selling #i#lesand5or gospel portionst"roug"out t"eP"ilippinesandtranslating t"e same into several P"ilippine dialects. ."ecit! treasurer of manila informed t"e plaintiff t"at it asviolatingseveral ordinancesfor operatingit"out t"enecessar!permit andlicense, t"usrequiringt"emtosecure one and pa! license fees.Plaintiff paid t"e defendant its permit and license fees toavoid t"e closing of its #usiness. $merican #i#le filed acomplaint questioning t"e constitutionalit! and legalit! oft"e ordinances and pra!ed for a refund of t"e pa!mentsmade. %it!of 4anilapra!edfor t"ecomplaint to#edismissed. .rial court dismissed it. Plaintiff appealed.'ssue:1"et"er or not t"e $merican &i#le 0ociet!lia#le to pa! sales tax:eld5(uling:*o, $merican &i#le 0ociet! is not lia#le to pa!sales tax. $ccording to 0ec. 1 of >rdinance 3CCC, oneof t"e ordinance in question, person or entit! engaged inan!of t"e#usiness, tradesoroccupationenumeratedunder 0ec. 3 must o#tain a 4a!orpol. &!reasonof t"eamendment to section +@ of t"e .ax %ode, t"e%ommissioner of 'nternal (evenueinademandletterdated Fe#ruar! 15, 1BD3 required t"e petitioner to pa!deficienc! income taxes for 19$8.to 19%1. ."e petitionercontested t"e assessments. ."e %ommissionercancelled t"e assessments for 1BDC and 1BD1 #utinsisted on t"ose for 1BE8 and 1BEB.."epetitioner filedapetitionfor revieit"t"e.ax%ourt, "ic"onFe#ruar!+E, 1B8+"eldt"epetitionerlia#le onl! for t"e inco(e tax for t&e period fro( 6anuar-1 to August #! 19$9 or #efore t"e passage of (epu#lic$ct *o. EC+C"ic"reiterateditstaxexemption. ."epetitioner appealed to t"is %ourt. 'ssue:1"et"er or not t"e petitioner is onl! lia#le for t"enincome tax for t"e period #efore t"e passage of ($ *o.EC+C "ic" reiterated tax exemption.31(uling:Aes, petitioner as"eldto#elia#leonl!for t"etaxproperands"ouldnot #elia#lefort"esurc"argeandinterest. 1e "old t"at %ongress could impair petitioner9slegislativefranc"ise#!ma)ingit lia#leforincometaxfrom "ic" "eretofore it as exempted #! virtue of t"eexemption provided for in section 3 of its franc"ise. ."e%onstitution provides t"at a franc"ise is su#-ect toamendment, alteration or repeal #! t"e %ongress "ent"epu#licinterest sorequires(0ec. 8,$rt. P'6,1B35%onstitution= 0ec. 5, $rt. P'6, 1BD3 %onstitution),(epu#lic $ct *o. 5@31, inamendingsection+@of t"e.ax %ode #! su#-ecting to income tax all corporatetaxpa!ers not expressl! exempted t"erein and in section+D of t"e %ode, "ad t"e effect of 'it&dra'ing petitioner7sexe(ption fro( inco(e tax.."e .ax %ourt acted correctl! in "olding t"at t"eexemptionasrestored#!t"esu#sequent enactmenton$ugust @, 1BEBof (epu#lic $ct *o. EC+C "ic"reenacted t"e said tax exemption. :ence, t"e petitioneris lia#leonl!for t"eincometaxfor t"eperiodfrom;anuar! 1 to $ugust 3, 1BEB "en its tax exemption asmodified #! (epu#lic $ct *o. 5@31.32Abra 6alle College Inc. vs ADuino et.al L-;9386 4une !)# !998Facts: Petitioner,aneducational corporationandinstitutionof"ig"er learning dul! incorporated it" t"e 0ecurities andKxc"ange%ommission, filedacomplaint toannul anddeclare voidt"eF*oticeof 0ei2uren t"e nort" is an oldcemeter! it" to of its alls still standing, and a portion"ere formerl! stood a toer, t"e #ase of "ic" still #eseen.$s required #! t"e defendants, t"e plaintiff paid, underprotest, t"e land tax on t"e lot ad-oining t"e convent andt"e lot "ic" formerl! as t"e cemeter! it" t"e portion"ere t"e toer stood.."e plaintiff filed t"is action for t"e recover! of t"e sumpaid #! to t"e defendants #! a! ofland tax,allegingt"at t"e collection of t"is tax is illegal. I&&,-+1>*t"elandtaximposedont"ec"urc"isillegalR,LING+."e exemption in favor of t"e convent in t"epa!ment of t"elandtax(sec. 3@@IcJ $dministrative%ode) referstot"e"omeof t"eparties"opresidesover t"e c"urc" and "o "as to ta)e care of "imself inorder todisc"arge "is duties.'nt"ereforemust,in t"esense, include not onl! t"e land actuall! occupied #! t"ec"urc", #ut alsot"ead-acent grounddestinedtot"eordinar!incidental usesof man. Kxcept inlargecities"ere t"e densit! of t"e population and t"e developmentof commerce require t"e use of larger tracts of land for#uildings, a vegeta#le garden #elongs to a "ouse and, int"e case of a convent, it use is limited to t"e necessitiesof t"e priest, "ic" comes under t"e exemption.'nregardtot"elot "ic"formerl!ast"ecemeter!,"ile it is no longer used as suc", neit"er is it used forcommercial purposes and, according to t"e evidence, isno #eing used as a lodging "ouse #! t"e people "oparticipateinreligiousfestivities, "ic"constitutesanincidental useinreligiousfunctions, "ic"alsocomesit"in t"e exemption.CIR vs. 0is'o( of t'e *issionar /istrict of t'e1'il. Islan5# et. al.L-!922)August ;!# !96)Facts: Petitioner denied respondent9s claim for refund of"is pa!ment of P118,8@D as compensating tax levied onseveral s"ipments of materials and ot"er articlesintended for use in t"e construction and operation of t"eto"ospitals, includingt"e0t. /u)e9s:ospital, anda"ig"sc"ool managed#!t"erespondent. (espondentargued t"at t"e materialsand articlesreceived #!"imereexempt frompa!ment of compensatingtaxast"ese s"ould #e considered as donations. Petitionercontends t"at t"ese s"ould not #e considered as suc"ast"e4issionar! Histrict is merel!a#ranc"of t"e4issionar! 0ociet!andt"us"oldsaseparateinterest,and t"at 0t. /u)e9s :ospital is not a c"arita#le institutionas it admits pa! patients.'ssue: 1"et"er or not t"e s"ipments received #!respondent are exempted from t"e lev! of compensatingtax.:eld: ."e 0% "as ruled in t"e affirmative. $s admitted #!respondent t"at t"e 4issionar! Histrict is a corporationsoleandisseparateanddistinct fromt"e4issionar!0ociet!, it is a #ranc" onl! in religious matters and must#econsideredindependent fromt"ereligioussociet!"ic" is t"e latter. :oever, t"e same can also #e saidof t"e (oman %at"olic %"urc" in t"e P"ilippines, merel!a #ranc" of t"e 8niversal %at"olic %"urc", "ic" en-o!stax exemptions in similar transactions. 4ore importantl!,petitioner is incorrect in arguing t"at 0t. /u)e9s is not ac"arita#le institution ? admission of pa! patients does notc"ange t"e c"arita#le c"aracter of a "ospital if its fundsare devoted exclusivel! to t"e maintenance of t"einstitution.34AG,ILAR 6& CIR CA-GR 08. &1-!62;2*ARC. ;3# !993 35CIR 6& C8,R$ 8F A11-AL&G.R. N8. !2232;8ct !2# !998F$%.0:A4%$ is a non?stoc), non?profit institution, "ic" offersprogramsinrelationtoitsreligious, educational andc"arita#le o#-ectives.'n 1B8C, it earned an income fromleasing out a portion of its premises to small s"oponers and par)ing fees ere also collected from non?mem#ers. 'n 1B8@ t"e %ommissioner of 'nternal(evenueissuedanassessment toprivaterespondent.A4%$ protestedt"eassessment contendingt"at t"e!are exempt from pa!ing suc" taxes #ecause t"e! are anon?profit institution.'008K:1"et"er or not t"e income of private respondents fromrentalsof small s"opsandpar)ingfeesexempt fromtaxation.:K/H:$relevant provisionof t"e*ational 'nternal (evenue%ode:0ection +D. Kxemptions from tax on %orporations.? ."efolloing organi2ations s"all not #e taxed u#der t"is .itlein respect to income received #! t"em as suc"?Pxxxxx xxxxxxxxxxxxxxxxxxxxxxxx(g) %ivix league or organi2ation not organi2ed for profit#ut operated exclusivel! for t"e promotion of socialelfare=PPPPPPPPPPP PPPPPPPPPPPP PPPPPPPP*otit"standing t"e provision in t"e precedingparagrap", t"e income of "atever )ind and c"aracter oft"e foregoing organi2ations from an! of t"eir properties,real or personal, or from an! of t"eir activities conductedfor profit, regardlessof t"edispositionmadeof suc"income, s"all#e su#-ect to t"e tax imposed under t"is%ode.."e exemption claimed #! A4%$ is expressl!disalloed #! t"e ver! ording of t"e last paragrap" oft"en0ection+Dof t"e *'(%"ic"mandatest"at t"eincome of exempt organi2ations from an! of t"eirproperties, real or personal, #e su#-ect to t"e taximposed #! t"e same code, &ecause t"e last paragrap"of said section su#-ects to tax t"e rent income of A4%$from its real propert!.C8LL-C$8R 8F IN$-RNAL R-6-N,- vs.C8,R$ 8F $A9 A11-AL# -$. AL.7.(. *o. 1+@C@3,>cto#er 1@, 1BB8F$%.0:A4%$, anon?stoc)non?profit organi2ationearnedanincome of PEDE,8+B.8C from leasing out a portionof itspremises tosmall s"oponers, li)erestaurants andcanteen operators, and P@@,+5B.CC frompar)ing feescollected from non?mem#ers. %'( issued an assessmentto A4%$amounting toP@15,E15.C1 as deficienc! onincometax, expandedit""oldingtaxandit""oldingtaxonage. A4%$filedaletter of protest #ut it asdenied #! t"e %'(.A4%$filed a petition for revie#efore %.$contending t"at t"e income generated #! t"erents and par)ing fees ere used to cover its operationandmaintenance. %.$ruled t"at t"e leasing of t"epropert! and par)ing fees collected arereasona#l!incidental toandreasona#l!necessar!fort"e accomplis"ment of t"e o#-ectives of t"e A4%$. $nappeal#! t"e %'( to %$ reversed t"e decision of %.$.A4%$filed a motion for reconsideration #efore t"e%$"ic" reversed its earlier decision. :ence t"ispetition.'008K:1"et"er or not income derived fromrentals of realpropert! oned #! A4%$ is su#-ect to income tax.(8/'*7:0ec. +D (*'(%).Kxemptions from tax on corporations ."e folloing organi2ations s"all not #e taxed under t"is.itle in respect to income received #! t"em as suc" xxxxxx xxx(g) %ivic league or organi2ation not organi2ed forprofit #ut operated exclusivel! for t"e promotion of socialelfare=(") %lu# organi2ed and operated exclusivel! forpleasure, recreation, and ot"er non?profita#le purposes,no part of t"e net income of "ic" inures to t"e #enefit ofan! private stoc)"older or mem#er=xxx xxx xxx*otit"standing t"e provisions in t"e precedingparagrap"s, t"e income of "atever )ind and c"aracterof t"e foregoing organi2ations from an! of t"eirproperties, real or personal, or from an! of t"eir activitiesconducted for profit, regardless of t"e disposition madeof suc"income, s"all #esu#-ect tot"etaximposedunder t"is %ode. (as amended#!Pres. Hecree*o.1@5D)&ecause taxes are t"e life#lood of t"e nation, t"e%ourt "as ala!s applied t"e doctrine of strict ininterpretation in construing tax exemptions. Furt"ermore,a claim of statutor! exemption from taxation s"ould #emanifest and unmista)a#le from t"e language of t"e laon "ic" it is #ased. ."us, t"e claimed exemption ,mustexpressl! #e granted in a statute stated in a languagetoo clear to #e mista)en.,."e p"rase ,an! of t"eiractivities conducted for profit, does not qualif! t"e ord,properties., ."is ma)es from t"e propert! of t"eorgani2ationtaxa#le, regardlessof "ot"at incomeis36used M"et"er for profit or for loft! non?profit purposes.6er#alegisnonest recedendum. 1"eret"eladoesnot distinguis", neit"er s"ould e.1:K(KF>(K, t"epetition is 7($*.KH.."e(esolutionsof t"e%ourt of$ppeals dated0eptem#er +8,1BB5andFe#ruar!+B,1BBE are "ere#! (K6K(0KH and 0K. $0'HK.37&mart Communications# Inc. vs. $'e Cit of/avao# et alGR No. !))29!&e(tember !6# 2338Facts:0mart filed a specialcivilaction for declarator!relief for t"e ascertainment of its rig"ts and o#ligationsunder t"e tax code of t"e cit! of Havao. 0mart contendst"at its telecenter in Havao %it! is exempt from pa!mentof franc"ise tax to t"e cit!. (espondent filed t"eir anserin"ic"t"e!contestedt"etaxexemptionclaimed#!smart. ."e! invo)ed t"e poer granted #! t"e%onstitution to local government units to create t"eir onsources of revenue. $pre?trial conferenceas "eld=(.% issued an order requiring t"e parties to su#mit t"eirrespectivememorandaand,t"ereafter,t"ecaseould#edeemedsu#mittedfor resolution. (.%deniedt"epetition. 0mart filed a motion for reconsideration "ic"as also denied. ."us, t"e instant case.'ssue: 1"et"erornot 0mart %ommunications, 'nc. islia#le to pa! franc"ise tax imposed #! t"e %it! of Havao:eld5(uling:Aes, 0mart %ommunications, 'nc. is lia#le to pa!franc"isetax.(.$.*o.D+B@ isnotdefiniteingrantingexemption to 0mart from local taxation. 0ection B of (.$.*o. D+B@ imposes on 0mart a franc"ise tax equivalent tot"ree percent (3L) of all gross receipts of t"e #usinesstransacted under t"e franc"ise and t"e said percentages"all #e in lieu of all taxes on t"e franc"ise or earningst"ereof. (.$. *o D+B@ does not expressl! provide "at)indof taxes0mart isexemptedfrom. 't isnot clear"et"er t"e in lieu of all taxes provision in t"e franc"iseof 0mart ould include exemption from local or nationaltaxation. 1"at is clear is t"at 0mart s"all pa! franc"isetax equivalent to t"ree percent (3L) of all gross receiptsof t"e #usiness transacted under its franc"ise. &ut"et"er t"e franc"ise tax exemption ould includeexemption fromexactions #! #ot"t"elocal andt"enational government is not unequivocal. .ax exemptionsareneverpresumedandarestrictl!construedagainstt"e taxpa!er and li#erall! in favor of t"e taxing aut"orit!.."e! can onl! #e given force "en t"e grant is clear andcategorical. ."esurrender of t"epoer totax, "enclaimed, must #e clearl! s"on #! a language t"at illadmit of no reasona#le construction consistent it" t"ereservation of t"e poer. 'f t"e intention of t"e legislatureisopentodou#t, t"ent"eintentionof t"elegislaturemust #e resolved in favor of t"e 0tate.38