CTA Case No. 863 (Resolution)

llA?UBLlC, OF ':tHE PHILll'"Pil'd!lt COURT OF TAX APfEllJ..S . NiiA I RAMO GAFCIA � Petitionerp - versus - THE HO ORABLE MELECIO R. DOivliNGO, in his Official Capacity as CCMMISSIONER OF I NTEfU AL REVENUE , Respondento ESOLUTIO N This is a 11Motion to Dismiss., filed by respon- dent on the ground$that - this Court has no jurisdiction to take cog- nizance of this case which is an appeal from a ru ing not involving a disputed assessment of the Commissioner of Internal Revenue; and the petition for review st at es no cause of actiono . It appears that petitioner Ramon Garcia is a lessee of minera land (Lode Lease Contract ! Oo V-310 approved May 25, 1960) situated in Panso , Calambai Laguna (Faro 2$ Petition for Review, CTA reco Po l)o He is also the owner of the land covered by the minera l ease ( Faro 4, Petition for Revie�w, CTA reco p., l) o Being both the lessee and owner of the mineral land, he deducted 5% from all roya ties on the gross output of his mines due the government and credited the amount so deducted to himself pursuant to the provisions of Section 247 of the Tax Code (Faro 5, Petition for Re- view, CTA reco Po 2)o I

ESOLUTION - � C.ToA. CASE Oo 863 - 2- Sometime in May, 1960 petitioner received a letter from the Director of Regional District Noo 5 of the Bureau of Internal Revenue (Paro 7, Petition for Re view, CTA rec. p. 2) advising him that the pro- visions of Section 247 of the Tax Code are not applica- ble to him (Annex A, CTA reco p. 6). Petitioner , .in a letter dated May 21, 1960 to respondent (signed by Jose R. Garcia) , took exception to the view entertained by the Regional Director. In reply, the Commissioner of Internal Revenue informed petitioner that he is not en- titled to the privilege granted under Section 247 of the Tax Code {Annex B, Petition for Review , CTA rec. p. 7). We quote the letter of respondent; nin reply to your letter dated May 21, 1960, requesting information as to whether or not as a leasee of mineral land you may deduct 5% of the royalties due on the value of the output of the mine covered by the lease corresponding to the share of the landowner, I regret to have to inform you that inasmuch as you are the owner of the and, the privilege can not be granted to you. Section 247 of the National Internal Revenue Code contemplates a situation where a person is the leasee of a mineral land belonging to anothero tl ( nnex B, CTA reco p. � 7) whereupon petitioner filed on July 19, 1960 the peti- tion for review in this case. Before filing his answer, respondent filed on August 16, 1960 the instant motion to dismiss (CTA rec. p. 12) 0 The issues to be resolved are: (l) � Whether or not the ruling of the Commissioner of Internal Revenue dated June 7, 1960 is appealable to

RESOLUTION - C. T.Ao CASE tO. 863 -3- this Court; and (2) hether or not the petition for review in the above-entitled ~ase states a cause of actiono The law in point is paragrcp h ( 1) of Section 7, Republic Act No. 1125: 1SEC. 7. The Court of Tax Appeals shall exerctse exclusive appel ate jurisdiction to review by appeal , as herein provided - n(l) Decisions of the Collector of In- ternal Revenue in cases involving disputed assessments~ refunds of internal revenue taxes , fees or other charges, penalties im� posed in relation thereto, or other matters arising under the National Internal Revenue Code or other law administered by the Bureau of Internal Revenue; 11 For this Court to acquire jurisdiction over a case, the provisions above quoted and Section 11 of the same law require that there be (1) a decision or ruling of the Commissioner of Internal Revenue; (2) that the decision be rendered in any of the cases enumerated therein; (3) . that such decision or ruling be appealed by the person, association or corporation adversely affected thereby; and {4) that the appeal be filed within thirty days after receipt of such decision or ruling (Philippine Trust Company vs . Bucas Grande Lumber Corporation , Manila Civil Case No. 9463, Res. December 7, 1957). Bearing in mind the above requisites, we now pro- ceed to weigh the merits of the arguments advanced by both parties. With respect to the fir~t issue, respondent argues that there being no assessment issued 'by respondent,

RESOLUTION - C.T.Ao CASE O. 863 - 4- this Court has no jurisdiction to take cognizance of this appealo On the other hand, petitioner contends . that a ruling of respondent adverse to the stand of a taxpayer '1can be interpreted as included in the class of a di sputed assessment". The controversy boils down to whether or not there is a fldisputed assessment~1 in the instant caseo What is an assessment? uAn 'assessment' fixes the liability of the ta~payer and ascertains the facts and furnishes the data for the proper pre- paration of the tax rollso" (Dallas Joint Stock Land Bank of Dallas VSo State, Tex. Civo App., ll8 _S�� 2d 941, 942; 4 ords & Phrases 428o) uThe word ' assessmenti, as used in tax statutes, does not mean me~ely the valua- tion of the property for taxation, but in- cLudes the whole statutory mode of imposing the tax� embracing all of the proceedings � for raising money by the exercise of the power of taxation from their inception to their conclusion. '1 (Jackson Lumber Co. vs . McCrimmon, 164 Fo 759, 763, 764; 4 Vords & Phrases 443.) e observe that the letter of respondent dated June 7, 1960 neither fixed the liability of, nor imposed a tax upon, the petitionero ' It only informed him that� he is not entitled to the privilege granted by Section 247 of the Tax Code. The record fails to show any letter or document fixing the liability of, and/or imposing on, and demanding of, the petitioner the payment of an in- ternal revenue tax. � e, therefore, cannot share peti- tioner's view that the case at bar involves a disputed assessment.

� - RESOLUTION - C.T. " C SE NOo 863 - 5- Petitioner _in his 'Opposition to Respondent's Motion to Dismiss~J alleged 11 however, that he received an assessment after the filing of the petition for re- view in thls case . But such receipt , much less the ex- istence of the alleged assessment , is not established by the evidence . It is further asserted that the instant case . falls within the scope of the clause flother matters arising under the National Internal Revenue Code or other law or part of law administered by the Bureau of . Internal Revenue'1 which is found in the �first para- . graph of Section 7, Republic c t Noo 1125, afore-quoted. Ve cannot subscribe to pet~tioner ' s theory . In order . . that a matter may come under said clause, it is neces- sary that it belongs to the same kind or class speci- fically enumerated (Felipe B. Ollada vs . The Court of . Tax Appeals , et al. , G. R., No. L- 8878 , .J"uly 24, 1956) � Said our Supreme Court: 0 Note that the law gives to the Court of Tax Appeals exc lu s ive appellate jurisdiction to review the decisions of the Collector of Internal Revenue , the Commissioner of Customs t and the provincial or city Boards of Assess- ment Appealso t ote also that in defining the cases that may be reviewed the law begins by enumerating them and then adds a general clause pertaining to other matters that may arise under the National Internal Revenue Codet the Customs Law and the ssessment Law. This shows that the vothe~ matters' that may come under the general clause should be of the same nature as those that have - preceded them applying the rule of construction known as ejusdem generiso In other words , in order that a matter may come under the general clause, it is necessary that it belongs to

� RESOLUTION - C.. T.A. CASE NO.. 863 - 6- the same kind or class therein specifically enumerated . Otherwise, it should be deemed foreign or extraneous and is not included. 11 (Ollada vs .. The Court of Tax Appealsg et alop supra,.) The ruling in question does not involve a disputed as- sessment, refund of internal revenue taxes, fees or other charges, or penalty in relation thereto.. Conse- quently, the ruling in question does not come within the purview of 1other matters'o Moreover, the action at bar is in effect one for declaratory relief of which this Court has no jurisdic- tion to take cognizance. 11 X x x It would not be i n keeping with the intention of the Legislature and would, on the other hand, be creati g handicaps to the speedy termination of the cases appealed to this Court within its exc lusive appellate jurisdiction, if we ere to entertain, as well, actions for declaratory relief not in- volving live and actual. cont oversies .. x x x�' (Libby, McNeill & Libby (Phil.) , Inc. vs .. The Co~ts s ioner of. ustvms , C.T.A. Case No. 291 1 Augo 27 1 1956.) ~e, therefore, are i hclined to believe and so hold that respondentts ruling dated June 7, 1960 informing petitioner that ~ he is not entitle to the privilege granted by Section 247 of the Tax Code is not a de~ sion of the Commissioner of Internal Revenue appealable to this Court under the provisions of Section. 7 of Re public Act Noo 1125. Hence, this Court has no jurisdiction to take cog- nizance of the instant appeal (see Leonor de la Rama, etc. vso The Collector of Internal Revenue, GJ. A. Case No. 421, Nov. 11, 1957). In view of our disposition of the first issue, we find it unnecessary to pass upon the second issue.

RESOLUTION - C. T. Ao CASE/ NC o 863 Lo~. - 7 - finding respondent is 1v otion to Dismiss meritorious, the same is hereby grantedo Let the peti- . tion for review in this case bep as it is her~by, dis- missed without pronouncement as to costso~ SO ORDEREJo Manila , October 17, 1960. ~- /~ Presiding Judge WE CONCUR: ROMAN M. UMALI Associate Judge