CTA Case No. 1491 (Decision)

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REPUBLIC OY THE EHILIPPINT COURT OF TAX MPPEALS QUEZON CITY

PHILIPPINE ACETYISNE CO. Fetitioner IRC. N b

votaus GA CA3E NO.1+91 THE COMISSIONER OP INTERNAL REV&NUE, Respondent.

Y

PECISION

This is an appeal lodged hy petitioner company

for the refund of sales tax in the aggregate amount of

328.02 which it paid under protest on difierent dates.

Petitioner is a domestie eorporation engaged in

the manufacture and sale of oxygen and ecetylene

gases. During the period from fanuary to Deecmber

1962 petitioner seld to the Hational Power Corporatiom

oxygen and acetylene gssea on which it paid P320.02

Ss aalec tax,

On February 11, 1963, petitioner requested refund

of above-mentioned amount on the theory that the

Netional Fower Corporation im exenpt from ell taxe

under Republic Act No, 358, as amended. Up to the

filing of the instant petition for review on February

12, 1964, however, petitioner's reqtiest Ter refund

had not been decided by respondent.

The only issue in the instant cese is whether

or not the Philippine Acetylene Co. Inc. is exempt

from the nayment of seles tax on its sales of oxygen

and acetylene gases to the National Pover Corporstion

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DECISION - CTA CASE HO.4491

under Republic Aet 358, as amended by Republie Aet

No. 987.

The pertinent groyision of law relied upon by

petitioner atatest

aii duties, fees, imposts, charges, and minicipalities. its indebtedness, the National Power Cerporation shali be exempt from all tax- s exeept reel property tax, and from restrictions of the Repubiic of the Fhilippines, its provinces, cities and Wgec. 2. To facilitate payment of

In sinilnr eases involving the same parties, thia Court has consistently resolved the question in

the negativo.

retary in his letter dated Pebruery 26, Nationel Fower Corporation, tioner without merit. To our mind, under Corporation is exempt from the payment of 1955, to the Generel Manager of the indirect taxes. x x x that the doctrine of the above quoted provision of aection 2, Repablic Act Ho. 358, the National Power only those taxes irectly payable by it- As correctly stated by the Executive Gec- granted by Republic Act No. 350 applies only to aireet taxes but does not extend tax is an indirect tax colleetihle from tax ismunity is not applicable where the the/nanufaeturer, producer or importer. e find the eontention of the peti- the exemption t0

and acetylene gases sold to the Nationnl ment and paysent of sales tax preserihed herein, and not by the buyer.Therefore. petitioner Philippine Acetylene Company, by feetion 186 of the Tax Code. direct tax on sales of articles or goods to be paid by the mamufacturer or produoer' -- the original seller - like the petitioner the manufacturer or producer of the oxygen Power Corporation, cannot elaim exempticn from the payment of salos tax simply be- cauge its buyer - the National Power Cor- poratien - is exempt from the peyment he case at bar involves the assess- Itisa of

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DECISION : CTA CASE NO. 1+9$

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highly diafavored in law and cannot be all taxes.I Comm.of Int.RevCTA Casea Nos.931 1019, Oat. 12, 1965. permitted to exist upon a vague implication. (See Philippine Acetylene Company v. The Comm. of Int.Rev. CTA.Case No. U98, March 2, 1962; Philippine Acetylene Co. v. The Kxemptions from taxation are

Furthermore, granting that the payment of the

salos tax on salen by petitioner to the Netional

Pover Gorporetion of oxygen and aeetylene gases is

ilicgal, tho proper party entitled to the ferund is

tho National Fower Corporetion beeanse the taz was

shifted to the latter. Paragraph 7 of the petition

for reviom reads as follovs: as amended by Republie Aet Nc. 987, alvays shifted the burden of taxation to thereof hoveverHepublic et No.358 acetylene gases to the National Fow r Corperatien herein involved, petitioner has the purchaser such that the sales tax or seven (7 per centum assessed upon the been ineluded in the gross selling price provides as fellows sale under Section 186 of the Tax Code has W In all its sales of oxygen and

It hag been held that where the tsx was shifted wrae.i tax, and from aii dutieso fees, indebtedness, tho National Power ions of the Repuhlic of the Corporation ahall be exempt from all taxes, except real property impoats, charges, and restrict To facilitato payment ef its

by the aeller to the buyer, and subsequently the tsx

paid wus found to have been erroneougly or illegally

collected, tho party entitled te the refund is the

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DECISION CTA CAE WO.1+91

buyer.Phil,Nfg.Co..Meer,76 Phil.+36

Ameriean Rubber Ce, v. Coll. of Int. iev., C.T.h. o.356,40 &632,Feb.27,1962.) mereforepeti- tioner has no cause of action ta institute the instant

appeal.

WtgRErORB, tho herein appeal is hereby dismissed

with costs against petitioner.

SO ORDRRED.

Cuezon City, July 25, 1966

awe Preaiding ROMAN M.UMALT Judge

WE CONCUR

IANISLAO H. Associate Judge PLS ELVAR

RAMOH L.AVANCBA Assoeiate Judge C V M

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