BANGKO SENTRAL NG PILIPINAS v. COMMISSIONER OF INTERNAL REVENUE

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY ENBANC BANGKO SENTRAL NG PILIPINAS, CTA EB NO. 2680 P e titioner, (CTA Case No. 10106) -versus- P re s e n t: Del Rosario, P.J. , Ringpis-Liban, Manahan, Baco rro-Villena, Modesto-San Pedro, R eyes - F a ja rdo, Cui-D avid, Ferre r-Flores, and Angeles, ]]. COMMISSIONER OF INTERNAL Promulgated: REVENUE, - ------R--e--s-p--o- n--d--e- n--t-.--------- --------A--P--R---0---2-~ 202~7-/-)//~-.'_ 1,~ Q �~ � x------------------------- DECISION RINGPIS-LIBAN, J.: Before the Court E 11 Ba11t is a Pericion for Review filed by pericio ner Bangko Sentral ng Pilipinas praying that the Court a) reverse and set aside the Decision dated February 15, 2022 and Resolution dated August 15, 2022 issued by the First Division o f the Co urt o f Tax Appeals (Co urt in D ivision), and b) render judgment directing respondent Commissio ner o f Internal Revenue.. to refund petitioner the amo unt o f Twenty-Fo ur Thousand Six Hundred E ighty- Four Pesos and Ninety-Two Centavos (Php24,684.92) representing the Documentary Stamp Taxes (DST) it paid under pro test fo r the acquisitio n of the property covered by Tramfer Certificate o f T itle o . T-82886 located in Cabanatuan City, ueva Ecija. The dispositive po rtio n o f the assailed Decisio n1 read s: ~ 1 Docker, CT.-\ Case :\o. 10 106, pp. �162- 1- -1.

htgc 2 of 11 DEC!SIO:\ CL\ EB :\0. cC>oll "WHEREFORE, in light of the foregoing comiderations, the Petition for Rc1�icw is DISMISSED for lack of jurisdiction. SO ORDERED." The dispusitin: portion of the assailed Resolution' reads: "WHEREFORE, premises considered, petitioner's klotion .for Reco//Jideratlo/1 (o. f tbe Dec/Jio11 dated 15 re!mtm.J' 2022) filed on i\Iarch 10, 2022, is DENIED for lack of merit. .\ccordingh�, the Decision of the Court in the above- captioned case dated h.:bruar\ 15, 2022, is hereby AFFIRMED. SO ORDERED." THE PARTIES Petitioner Bangko Scntral ng Pilipinas (BSP) ts a government instrumentality created b1 virtue of Republic .-\ct (R\) 1\:o. 7653, with principal office at A. i\Iabini corner P. Ocampo Streets, :\Ialatc, :\Ianila. It is registered as a taxpayer with Taxpayer Identification Number 000-354-790, and may be served with notices, orders, and processes through its Office of the Ceneral Counsel and Legal Services.' Respondent is the Commissioner of Internal Revenue of the Bureau of Internal Revenue (BIR), acting through the Rcn:nuc District Officer of RDC) l\o. 23B, C:abanatuan Citv. Nuc1�a EciJa. It n1a1 be served with notices and legal processes at Room 703, Litigation Division, Bureau of Internal Re1�cnuc, B!R National Office, BIR Road, Diliman, ( luezon Cin�." ~ ~ THE FACTS The facts as stated in the assailed Decision' arc as follows: "Sometime in 1998, rhc Rural Bank of San 0Iiguel (RBS01) obtained an emcrgcnn loan from petitioner'' and executed several 'Promissor\' Notes with Trust Rcccillt and Deed of .\s s i<m mcn~ t' ' b :...:o. ~Docker, CL-\ Case lil[ll(J, pp. ):2--)713. ; Petirion for RcYic\\", p. }. I Ibid. 1 Cirat1ons omi11eJ. r. Pcmioner I1:wgko ~cnrralng Pilip111il:' (B.SP~��

P�,1gc 3 of 11 DECIS!Ol' CL\ EI3 l'Cl. 26011 covering several parceb of land. RSR.\l failed to pay its obligations under the emergency loan and as a rcsulr, the mortgaged properties were foreclosed and sold. Petitioner acquired one of the foreclosed properties located in C:abanatuan City as the highest bidder in the aforesaid extrajudicial foreclosure sale. Petitioner allegedh� paid capital gains tax (C:GT) on the aforesaid transacnon but the RTR assessed pctltloncr of documentary stamp tax (DST) as an additional tax on the foreclosure sale of the subject propertY. Petitioner paid the deficiency DST through Credit ,\dvice Ticket Number 135CJO in the amount of Php24,684.92, with a notation 'Payment Under Protest,' on the contention that it is exempt from the payment ofDST under the 1997 National Internal Revenue Code (NIRC), as amended. Petitioner allegedh� filed admtnistrative claim for refund with the RIR's Re,�enue Disrnct ( )ffice (RDO) No. 23-B in C:abanatuan C:it1 embodied in letters dared .June 18,20185 and .\pril10, 2019. Due to the alleged inaction of rcspondent7 on its claim for refund of DST, petitioner filed a Petition for Review with this Court on J uh 5, 2019." In the Petition for Review8 before the Court in Division, petitioner prayed that the Court render judgment ordering respondent to refund to herein petitioner the total amount ofTwcnn-l'our'J'housand Six Hundred Eighn�-l'our Pesos and Ninety-Two Centavos (Php24,684.92). as DST paid for the pmpert1 covered b1. Transfer Certificate of Title No. T-82886 located in C:abanatuan Cin. legally acc1uired by petitioner. On .\ugust 27, 2019, the petitioner filed his \nswer,'' praying that the Petition for Re\�icw be denied fur lack of merit. The issue stated in the Joint Stipulations of Facts and Issues is "\'V'hethcr BSP is entitled to the refund of DST in the amount of Twenty-Four Thousand Six Hundred Eighty-Four Pesos and '\inety-Two C:cntm�os (P24,684.92)."10 On Februaf\' 15, 2022, the Court in Division rendered the assailed Decision./ ~ Rc~pvm.k:nt Cunllnissioucr of Internal Rc\ cnuc ~Docket, CL-\ C:1sc \:o. [IJ[II(J, pp. lU-~(J, \\-ith :l!lllc:\l"S. ') I hid., pp. J(J_(>-L 11' lbid.,.Jotnr SriJndatH>n of !�acts :~nd I~suvs, ]l- _)1:1

DEC!SID:\ CL\ Ell :\0. :'@I On ;\Larch 10,2022, petitioner filed a ".\lotion for Reconsideration (of the Decision dated 15 February 2022)." 11 On .\larch 21, 2022, the Court in Division issued a Resolution1' ordering respondent to file comment on petitioner's ".\lotion for Reconsideration (of the Decision dated 15 h�bruan� 2022)" within fin� (5) da1�s from notice. On .-\pril 5, 2022, the Court in Division received respondent's "Opposition (Re: Motion for Reconsideration)."" On ,\Iar 24, 2022, the Court in Division issued a Resolution 11 submitting for resolution the petitioner's ".\lotion for Reconsideration (of the Decision dated 15 February 2022)." On .\ugust 15, 2022, the Court in Di,�ision issued a Resolution li denying for lack of merit the petitioner's ".\!orion for Recomideration (of the Decision dated 15 h:bruan 2022)." .\gt.<.h>rie\�ed ' jJetitioner filed before the Court E11 Ba11c this Petition for Review''' on September 9, 2022. On October 4, 2022, the Court E11 Bm1t issued a Resolution 17 ordering respondent to file Comment, not a motion to dismiss, within ten (1 0) days from nOtlCC. On l"m-�embcr 4, 2022, the Judicial Records Division of this Court issued a Records \' crification Rcport 18 staring that respondent failed to file his Comment on the Petition for RcTicw. In the Resolution datedjanuan 12, 2023, 1 the Court E11 Bcl/lcdeemcd the " instant case submitted for decision. THE ISSUE The Court E11 Ba11,'s is confronted with this main issue: "Whether or not the Court in Division erredin dismissing the case for lack ofjurisdiction." ~ II Ibid., pp. ~R)-)il() ~~Docket, CT.-\ C:tsc ~u. !11[0(>, p. :11-1. I' Ibid., pp. ) I:1-:1~()- 11 J!Htl., p. )~-l- l5 Ibid., pp. 52--:1_-,_)_ 11 Rullo, CT.\ Ln ::\o. 2CJtill, pp. 1-.'\11. ' 1- Ibid., pp. J()l)_J-CJ. 1" Ibid., p. !"""I. 1'' lind j)p. 1-_)_J--1.

DFCJSIO'-. CL\ Eil '\0. 2(,011 THE ARGUMENTS Petitioner argues that the Court in Division ha;; juri;;diction over it;; claim for refund of DST; thar Pre,;idcnrial Decree (PD) ""� 2-+2 is not applicable 1u petitioner; that Republic .\ct (R.\) '\o. 1125, a;; amended by R.\ No. 9282, a special and later law which ;;pecifically vests the Court with jurisdiction over claims for refund, should pre\'ail over PD No. 242 and the 1987 Administrative Code; that petitioner is not em-creel by PD l'\o. 242 because it is an independent central monetary authority \�ested with fiscal and administrative autononw; that PD No. 242 applies between executive office;; and agencies under the control and supervision of the President; that petitioner is entitled to refund because by express provision of Section 199 of the NIRC of 1997, a,; amended, petitioner is exempt from the documents and transactions related to the conduct of it;; bu;;iness; that petitioner is entitled to refund of DST erroneously and illegalh- collected b1� the BIR pursuant to Section 299 of the l'.:JRC of 1997, as amended; and that the di,;mi;;sal of the Petition for Re,�iew before the Court in Division rec1uiring petitioner to file an action anew with the Secretary of Justice runs counter to the principle of speech� disposition of cases. THE RULING OF THE COURT EN BANC The Court has jurisdiction to take cognizance of the Petition fi:Jr Review. Jurisdiction is defined as the power and authorit1� of the courts to hear, try and decide caseS. 01 ' It is conferred onlY b1�law and nor b,� the consent or waiver upon a court which, orhenvise, would hmT no jurisdiction over the subjeCt matter of an action." c\s a corollan�, it bear;; emphasis that this Court, being a court of special jurisdiction, can take cognizance onh� of matters that arc clcarlv within its jurisdiction.n In this connection, Section 7(a)(1) of!\.\ "'io. 1125,0 ' as amended by R. \ 'Jo. 9282,' 1 prm�ide;; as follows: "SEC. 7. }11risdictioil -The CL\ shall excrci;;e: (a) Exclusi\'C appellate jurisdiction to re\�iew b1� appeal, a;; herein prm�idcd: / ~" /:11/amfl ''�'� C/lt!ht!tk.. S ...-l (/f)/tJ!crlr /�in-r Slllitlllal Cl(y })a;;k), (;_]{_ :\"o. 19::?.1q~, December 13, 2017. ~~ Commi_,-_,-;l!lh'r o/ 11!/tm,,/ J{,.,.(,,/IIC !".>'. Sili<ol! J>/Ji/tjlf!il!,'.�. lnr~ (/t)ll/1<'1/) /!;/c/ J>/Jilippilf(.l.. \fmlllj(;dmill~. li!i".), C.R. :\o. ICN_"'_K, \brch 12, ::?.rll-1. :'2 Co;;;J;;;_,._,.;ril!err:(/!!lcma/ JZ,�;'/'1/1/1' 1'.1'. I �_) �_ /)o;;;ili~lij,�nd,;-r.-�. Ill,�.. ( ;_]\_ :\o. 221-!-llr, \larch 2.1, .21!] <)_ 21 .\n .-\cr Cn::1ting the Court ofT:tx .\ppc:d~ " 1.\n .\u Lxp:1mling rile _lurr:-;dtcrion of r!w Courr ofT:1x _\ppc:ll:-: 1,CL\). Llc\�:tttng lts R:lnk to the Lc\�cl of ;l Collcgiare C>ur1 \\�irh Spccwl Juri:-;Lhcrion 1111d l~nlarging lr;; \Iemhcrsh1p, .-\mending for rhe Purpose (:l'rt;un Sections of Republic .\cr \:o. ll2S, as :unemlcd. Othl'lWlSe I...::ncn\�n as 1he Lm� Creating the Court of 'l:lx .-\ppc:ds, and For Other Purposes.

DF.C!S!O".: CL\ Ell ::--:0. :'6BU ( l) Decisions of the Commissioner of Internal Revenue in cases involving disputed a,;,;c,;,;ments, refund:; of internal ren~nuc taxes, fee:; or other charges, penalties in relation thereto, or other matters arising under the N a tiona! Internal Revenue Code or other law:; administered lw the Bureau of Internal Rc\Tnuc;" (2) Inaction b\' the Commissioner of Internal Revenue rn cases involving disputed a,;,;essments, refunds of internal revenue taxes, fees or other charges, penalties in relations thereto, or other matters arising under the !'\ ational Internal Revenue Code or other laws . administered b1.� the Bureau of Internal Ren~nue,. when~ the 1'\ational Internal Revenue Code provides a specific period of action, in which e<bc the inaction shall be deemed a denraL xxx (Empha.rf.r arlrlfrl) Based on the foregoing provision, the appellate jurisdiction of this Court is not limited to cases which involve decisions of respondent on matters relating to assessments or refunds. The second part of the pnwision covers other cases that arise out of the NIRC or related law:; administered h1.� the BIR. The wording'r of the prm�ision is clear and simple.��, In other words, the decisions of respondent which are appealable to this Court is not limited only to cao;es involving disputed assessments (which entails the filing of a protest to the 1�'.\N) or refund claims, but also includes "other matters" arising under the said laws. In the case of Col1!mi.r.~iolleru/illtemal ReNII!!e 1r.r. Com'! o/Ta.'-.�Appea/,� (/'7in! Di;)i.rio11). eta!.,"(, the Supreme Court hdd that: Section 7 of R.\ 1125, as amended, is explicit that, except for local taxes, appeals from the decisions of quasi- JUdicial agencies on tax-related problems must Ge brought exclusivch� to the Court of Tax .\ppeals. In other wcmb, within the JUdicial S\ stem, the law intends the Court of Tax ;\ppeals to ha\'l.' cxclusin� jurisdiction to resolve all tax problems. P.D. No. 24227 prescribes the procedures in settling adm.inistratively the disputes between or among go\-ernment offices, agencies and instrumentalities, including government-owned or controlled corporations (COC:C:). It is a general law that deals with admini,;trativc settlement or adjudication of disputes, claims and controversies between or among government offices, agencies and instrumentalities, including government-owned or controlled corporations. Its cmTrage is comprehensi\T, encompassing all disputes, claims and controversi~ ~:. J>hifippi!!c _I llftrll:l /1.1!..-, f lh'. ;�_,-_ ( .fJJJIIJ/!/.1/IJ//tr o( I J!!cm,d 1\\'l't'l!Iii', (;.I\. :-.. (1. 1(J ::'.S.~ 2. l)cccm bcr I C1, 2! Jil-l: ( .t)}lf!Ni.��.,�!lll!tr ?/1 n/cm,t! Rti'I'I!Jii' 1�.". l!a!J!/;rc),; ..:_�~ _fj11i.�'l }J),;'It/Y'ilio. Ill,�.. (; .R. \:11. 1(1<)22.=i, \: rJ\�cml H.:r 1...,, ?II] I J. ~r. Cl R /'.1�. Co11rl t:J"Ta.--: / 1ppeaf,. (Fin"! /)il'l~�ioll) alitI Pilijlillii.L. .)'f,tf.l p,,fmlmm Corp. (C. R. \:o. 21 tl)(J 1, \Larch 1::i, 2112 L Blln./<111 ~( CirJ!om.��. d a/. I'.L. Prlipi11a_,� .\'J,.:f/ Pdm/r:;tm C()/Jl.. (G.H.. ~o. 21129-l, \larch 1), 2U2l, and Pi!rj!/lfcU Shdt h�!rolmm C()!p. ;�_,-. CL---l (ri'n! Dir�i.�i(/1/). d a/.. CIJ\. :\"oC'. 212--t<JII, .\larch 15, 2U2J. -:- Pre,;crib1ng thL� Procedure !(l!" .\dmuli:;tr:lll\'e ~L�Irkmcnt (lr .\d1udication ()f Dt,;pure,;, <:Lum,; :1nd Con tro\�er::;ie,; Bct\\�ccn or _\mong ( ;on-rnmcnt U filcc~. _\gcncic:; :md 1n::;rrumcnt:ditlc5, Inclmling C; o\�crnmL�n I Chn1ed or Conrrolkd (~orporatJOn:;, :1nd For ()r\wr Purpo~c:;.

P<lg,e 7 of 11 DEUSIO'-: CLI lcB '-:0. :'6811 It has been incorporated in Execu6ve Order No. 292, the Revised c\dministrati,�c Code of the Philippines. On the other hand, IL\ ~o. 1125 2 is a special law " dealing with a specific subject matter- the creation of the C:ourt of Tax .\ppeals (CT.\), which shall exercise cxclusi\-c appellate jurisdiction over the tax disputes and controversies enumerated therein. Following the rule on statuton� construction involving a general and a special law, R,\ No. 1125, on the jurisdiction of the CL\, constitutes an exception to PD :\o. 242. J]xen supposing PD :\o. 242 should pre\�ail over R.\ No. 1125, as amended by R.\ No. 9282'" and R.-\ No. 9503," 1 the present dispute would still not be covered by PD No. 242. It was stated in PD No. 242 that only disputes and controversies solelv between or among departments, bureaus, offices, agencies and instrumentalities of the '\ational Covernment, including COCC, shall be adnlinistrarivch� settled or adjudicated b\� the Secretarv of Justice, the Solicitor Ceneral, or the Covernmcnt Corporate Counsel, depending on the issues and governn1ent agencies involved. Petitioner was established as an Independent central monctan� authorit\� that enjoys fiscal and administratin~ autononw. 11 Section 20, .\nick :\.11 of the 1987 Constitution states: 11 Scction 20. The Congress shall establish an independent central monetary authority, the members of whose governing board must be natural-born Filipino citizens, of known probity. integrit1�, and patriotism, the majority of whom shall come from the private sector. The\' shall also be subject ro such other qualifications and disabilities as may be prescribed b,� law. The authority shall provide polin direction in the areas of money, banking, and credit. Tt shall have supen�ision over the operations of banks and exercise such regulatorY powers as ma1� be provided by law over the operations of finance companies and other institurions performing similar functions. Until the Congress otherwise provides, the Central Bank of the Philippines operating under existing laws, shall function as the central monctan� authorit\ .11 (EmpiJa.riJ .fllpplierlj Sections 1 and 2 of Republic .\ct (R.\) 0iu. 7653, otherwise known as The New Central Bank "�\ct, provicl/v 2�' .\n _\ct Crc~ning the Cour1 ofT:1x .\ppc.d~. ~�~ .\n .\cr Ex[)andmg lhl� _lunc-dlc!Jon of the (.our! ofT.t:.: .\p[1eab {CT.\1, Lln�;t!lng ito; Rank to rhc L~.:\�el of :1 Collegiate C:ourl \\'llh )pcci:d .Jun~diuJon and l�:nLtrg1ng II:' mcmhcr:-;h1p.. \tllu1dmg for the Purpo:-;c CcrLllll Section:;. or Republic .-\n :-.:o. 112), �.1~ �.tmvmlvd, Oihn\\�J~c kno\\�n �.1:' rhc I :,m Cre.tring the Courr of �Lt:-;. . \ppcab, and For Other Purpo<-C::i. '11 . \n .-\ct Enlargmg the Organli':l rion<ll .Structure ul rhc ( :uurt of �r�ax .\ppc1ls . .-\memhng for rhe Purp<>se Cerr:tlll Sectiom of the Law Creating the Coun ofT:lx \ppt:-als, :llld For Orhcr Purposes. ' 1 Sectwn l, R.-\ :\o. -(1:1.1.

P;1gc 8 of 11 DECISJO" CT. I Ell "0. :'(,80 "Section 1. Declaration of Polic1�. The State shall maintain a central monetary authority that shall function and operate as an independent and accountable body corporate in the discharge of ir,; mandated respomibilities concerning money, banking and credit. In line with this policy, and considering its unique functions and respom;ibilities, the central monetary authority established under this .\ct, while being a government-owned corporation, shall enjoy fiscal and administrative autonomy. Section :2. Creation of the B;uwko Sent ral - There is here b1 h ' established an independent central monetary authority, which shall be a body corporate known as the Hangko Scnrral ng Pilipinas, hereafter referred to as the Bangko Scntral. ~xx." (Empba.rir JlljJjJIIer0 In Power SedorAJJetJ a11d Liabi!itieJ i\iallc~~ei!Je!lt C01poratio1111J. Coml1li.uioner of flltemal ReJ.'fll/!1!12 (PSc\L\J case), the Supreme Court states the applicability of the procedure in the resolution of clisputes with regard to government oftlces or agencies under the Executi\T Branch. The Supreme Court said: "Xxx, contran� to the ruling of the Court of ,\ppeals, we find that the DO) is vested by law with jurisdiction over this case. This case involves a clispute between PS. \1 "\!and \:PC, which are both wholly government-owned corporations, and the BIR, a government office, over the imposition of VAT on the sale of the two power plants. There i:.; no ljuestion that original jurisdiction is with the em., who issues the preliminan� and the final tax assessments. 1-lowe\Tr, if the gm-crnmcnt entity dispute' the tax assessment, the dispute is alrcach� between the BIR (represented b1' the CIR) and another government enriry. in this cao;e, the petitioner PSALM. Under Presidential Decree No. 242 (PD 242), all disputes and claims solely between government agencies and offices, including government-owned or controlled corporations, shall be administratively settled or adjudicated by the Secretary of Justice, the Solicitor General, or the Government Corporate Counsel, depending on the issues and government agencies involved. The law is clear and covers "all disputes, claims and controversies solely between or among the departments, bureaus, offices, agencies and instrumentalities of the ,/V'

P<1ge 9 of 11 DECISTOC\ CL~\ Ell '-:0. 26811 National Government, including constitutional offices or agencies arising from the interpretation and application of statutes, contracts or agreements." \'\!hen the law says "all disputes, claims and controversies ,;olely" among government agencies, the law mean,; all, without exception. Only those cases already pending in court at the time of the cffecti\�m� of PD 242 are not covered by the law. The pm11mc of PD 242 is to provide for a speedy and efficient administrative settlement or adjudication of disputes between government offices or agencies under the Executive branch, as well as to filter cases to lessen the clogged dockets of the COUrtS. XXX XXX XXX PD 242 i:; onh� applicable to disputes, claim,;, and contnwer:<ies solely between or among the departments, bureaus, office:;, agenCJc:< and imtrumentalitics of the National C ovcrnmcnt, including gmTrnmenr-owned or controlled corporation,;, and where no private party i:; involved. In other words, PD 242 will only apply when all the parties involved are purely government offices and government-owned or controlled corporations. Xxx Since thi,; case is a dispute solely between PS.\L\1 and NPC, both government-owned and controlled corporations, and the BIR, a l\ational Covernment office, PD 242 clearly applic,; and the Secretary of Ju:<ticc ha,; juri:;diction over this ca:<c. It is only proper that intra-governmental di:;putes be settled admini:<tratively ,;tnce the opposing government offices, agencies and instrumentalities are all under the President's executive control and supervision. hmhcrmorc, it ,;hould be noted that the 1997 NIRC i:; a general law governing the imposition of national internal revenue taxes, fees, and charge,;. On the other hand, PD 242 is a special law that applies only to disputes involving solely government offices, agencies, or instrumentalities.

P<lge 10 of 11 DEUSIO\: CLI Ell l\0. 26~11 Thus, even if the 1997 NIRC, a general statute, is a later act, PD 242, which is a special law, will still prevail and is treated as an exception to the terms of the 1997 NIRC with regard solely to intra-governmental disputes." xxx (EmpbmiJ .111pp!ied) .-\]though respondent is under the Pre:;idcnt's executive control and supervision, petitioner i:; neither under the 1-:xecuti,-e Branch of the government nor under the President's supervi:;ion and control to fall within the realm of P.D. No. 242. :-.lorcovcr, the dispute between the parties in this case, which involves a claim for refund of documentarv stamp tax, is not governed by PD 242. Considering that under Section 7(a)(2) of Republic .\ct (R.\) No. 1125, a:; amended, this Court is vested with exclusive appellate JurisdiCLion to review by appeal the inaction of respondent in cases invoking refunds of internal revenue taxes, thus, this Court ha:; jurisdiction to take cognizance of the instant Petition for Review. WHEREFORE, prcrnises considered, the instant Petition for Review is GRANTED. The Decision dated Fcbruan 15, 2022 and the Resolution dated .\ugust 15, 2022 issued b1� the Court in Di1�ision is REVERSED and SET ASIDE . .\ccordingly, let this case be remanded to the Court in Division for the determination of the refundable amount. SO ORDERED. <IL.~ ~ l _ MA. BELEN M. RINGPIS-LIBAN J . \~~ociatc u~ticc WE CONCUR: Presiding Justice IFI!b C~�. ~e/J. 15. 2022 dm mped, 1 JJlrltaillmJ. Dc,i.riott a11d;oillf. CPP\ Di.r.ret;!illg Opimo;; CATHERINE T. MANAHAN _\ssociatc Justice

P;1gc 11 of 11 DEUS TO'.: CLI Ell C\0. 2C>.~II l;;::;r.~~dLJ~it:J~~~:;o SCO i11 tbe dedrio11- CL-i Case "\.Jo. 10106 MARIAN IVY F. REYES-FAJARDO .\ssociate Justice LANJ:lWut~1"1~"biM-lD~AVID .\ssociatl' Jus rice J .\~~ociarc u~ticc CERTIFICATION Pursuant to .-\rticlc \'lll, Section 13 of the Constitution, it is hcrel)\- certificd that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court. ROMAN G. DEL ROSARIO Presiding Jus rice

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY ENBANC BANGKO SENTRAL NG CTA EB NO. 2680 PILIPINAS., (CTA Case No. 10106) Petitioner, Present: - versus- DEL ROSARIO, P.J., RINGPIS-LIBAN, MANAHAN, BACORRO-VILLENA, MODESTO-SAN PEDRO, REYES-FAJARDO, CUI-DAVID, FERRER-FLORES, and ANGELES,JJ COMMISSIONER OF Promulgated: INTERNAL REVENUE, APR 0 2 2024 x- ___________ ~~s?~~~~~t~ _____________ ;jylf~'>_7/_.~~ ~ ~~� DISSENTING OPINION FERRER-FLORES, J.: With due respect to our esteemed colleague, Honorable Associate Justice Ma. Belen Ringpis-Liban, I am constrained to withhold my assent on the ponencia. In the Decision penned by Honorable Associate Justice Ringpis-Liban, it was held that the Court of Tax Appeals (CTA) has jurisdiction to take cognizance over the Petition for Review. It was pointed out that Republic Act (R.A.) No. 1125,1 being the special law, prevails over Presidential Decree (P.D.) No. 242,2 a general law. Accordingly, following the rule on statutory construction involving a general and a special law, R.A. No. 1125, on the 1 jurisdiction ofthe CTA, constitutes an exception to P.D. No. 242. 1 An Act Creating the Court ofTax Appeals. Issued on June 16, 1954. 2 Prescribing the Procedure for Administrative Settlement or Adjudication of Disputes, Claims and Controversies Between or Among Government Offices, Agencies and Instrumentalities, Including Government-Owned or Controlled Corporations, and for Other Purposes. Issued on July 9, 1973 .

DISSENTING OPINION CTAEBNo.2680(CTACaseNo.l0!06) Page 2 of8 I respectfully disagree. In the case of The Department ofEnergy vs. Court ofTax Appeals,3 the Supreme Court, citing Power Sector Assets and Liabilities Management Corporation vs. Commissioner of Internal Revenue4 (PSALM case), has categorically ruled to the contrary, to wit: Special Laws prevail over General Laws P.D. No. 242, as incorporated in the Revised Administrative Code in Chapter 14, Book IV, should prevail as against laws defining the general jurisdiction of the CTA, i.e., R.A. No. 1125, as amended, and the NIRC. This is consistent with the fundamental rule that special laws prevail over general laws. P.D. No. 242 deals specifically with the resolution of disputes, claims, and controversies where the parties involved are the various departments, bureaus, offices, agencies, and instrumentalities of the government. P.D. No. 242 should be read as an exception to the general rule set in R.A. No. 1125 and the NIRC that the CTA has jurisdiction over tax disputes involving laws administered by the BIR. The Court has defined a general law as "a law which applies to all ofthe people ofthe state or to all ofa particular class ofpersons in the state, with equal force and obligation." In Valera v. Tuason, et a/., it was also described as "one which embraces a class of subjects or places and does not omit any subject or place naturally belonging to such class." On the other hand, a special law is one which "applies to particular individuals in the state or to a particular section or portion ofthe state only" and which "relates to particular persons or things of a class." As the Court has consistently held, where there are two laws which appear to apply to the same subject and where one law is general and the other special, the law specially designed for the particular subject must prevail over the other. Stated more simply, the special law prevails over the general law. Generalia specialibus non derogant. XXX XXX XXX Here, the NIRC and R.A. No. 1125, and specifically their provisions on the jurisdiction ofthe CTA over tax disputes involving tax laws enforced by the BIR, should be read as general provisions governing the settlement of disputes involving tax claims. These provisions apply to the resolution of this general class of tax cases involving all persons, without exception. Stated more simply, they apply with equal force to all persons involved in disputes pertaining to all tax claims arising from all tax laws being implemented by the BIR. In clear contrast, P.D. No. 242, as now embodied in the Revised Administrative Code, applies only to particular persons involved in a uniquely specific category of cases - disputes, claims, and controversies where all the parties are government entities. The Court's ruling in City of Manila v. Teotico, Bagatsing v. Ramirez, and other similar cases, dictate that an interpretation of P.D. No. 242 as a special law that functions as an exception to !he geneml rule on tht j urisuiction of courls, such as the CIA, 3 G.R. No. 260912, August 12,2022. i 4 G.R. No. 198146, August 8, 2017.

DISSENTING OPINION CTAEBNo.2680(CTACaseNo.IOI06) Page 3 of8 to resolve disputes. Where the dispute involves government entitles on opposing sides, P.D. No. 242, as embodied in the Revised Administrative Code, determines, in the first instance, the mode of dispute resolution. In ruling that P.D. No. 242 is the special law (as opposed to R.A. No. 1125 and the NIRC), the Court also takes into consideration the rationale for the enactment ofP.D. No. 242. The First and Second Whereas Clauses ofP.D. No. 242 provide: "WHEREAS, it is necessary in the public interest to provide for the administrative settlement or adjudication of disputes, claims and controversies between or among government offices, agencies and instrumentalities, including government-owned or controlled corporations, to avoid litigation in court where government lawyers appear for such litigants to espouse and protect their respective interests although, in the ultimate analysis, there is but one real party in interest the Government itself in such litigations; WHEREAS, court cases involving the said government entities and instrumentalities have needlessly contributed to the clogged dockets of the courts, aside from dissipating or wasting the time and energies not only of the courts but also of the government lawyers and the considerable expenses incurred in the filing and prosecution of judicial actions"; (emphasis supplied) In the performance of our Constitutional duty to interpret the laws, it is essential that the Court do so with due regard to legislative intent. Given the purpose animating the enactment of P.D. No. 242, the Court must read it as a special law intended to govern the resolution of disputes involving government agencies. It is only by reading P.D. No. 242 as an exception to the general rule governing the jurisdiction of the CTA over tax disputes that the Court will be able to respect and uphold the legislative intent to submit all inter-governmental disputes to the jurisdiction of the Executive in the pursuit of avoiding litigation in cases where the opposing parties ultimately represent the government as the sole real party-in-interest. A contrary reading ofP.D. No. 242 would defeat the purpose for its enactment as an entire class of cases (i.e., tax cases under the jurisdiction ofthe CTA) would operate outside its ambit, thereby significantly limiting the Government's ability to resolve internal disputes and further clogging the CTA's dockets. In Philippine National Oil Company v. Court ofAppeals (PNOC v. CA), the Court found that R.A. No. 1125 should be read as an exception to P.D. No. 242. However, it cannot be overemphasized that PNOC v. CA did not involve the actual application of the P.D. No. 242 as we ultimately ruled in that case that P.D. No. 242 does not govern the dispute considering that it involved a private party and was therefore not a case involving solely the government. Given this, our elucidations on R.A. No. 1125 and P.D. No. 242 in that case was obiter. As for Commissioner of Internal Revenue v. Secretary ofJustice and the Philippine Amusement and Gaming Corporation, which relied on our obiter in PNOC, the case was decided prior to PSALM, and it was only in PSALM that the Court made the definitive and binding pronouncement that P.D. No. 242 is a special law and must be read as a carve out from the general jurisdiction of the\

DISSENTING OPINION CTAEBNo.2680(CTACaseNo. IOI06) Page 4 of8 CTA over tax cases. PSALM operates as stare decisis in this case and must, therefore, govern our ruling. (Emphasis supplied) Based on the foregoing, with the promulgation of the PSALM case on August 8, 2017, P.D. No. 242 shall be read as the exception to the general jurisdiction of the CTA over tax cases. Considering that the original Petition for Review was filed by the BSP on July 5, 2019, after the promulgation of the PSALM case, P.D. No. 242 should be considered as the prevailing law in determining whether the CTA has jurisdiction over the dispute. Nonetheless, in the ponencia, it was held that, even supposing P.D. No. 242 should prevail over R.A. No. 1125, as amended, the present dispute would still not be covered by P.D. No. 242 since the BSP is neither under the Executive Branch of the government nor under the President's supervision and control to fall within the realm ofP.D. No. 242. On this point, I respectfully beg to differ. Section 1 ofP.D. No. 242 provides: SECTION 1. Provisions of law to the contrary notwithstanding, all disputes, claims and controversies solely between or among the departments, bureaus, offices, agencies and instrumentalities of the National Government, including government-owned or controlled corporations but excluding constitutional offices or agencies, arising from the interpretation and application of statutes, contracts or agreements, shall henceforth be administratively settled or adjudicated as provided hereinafter: Provided, That this shall not apply to cases already pending in court at the time of the effectivity of this decree. (Emphasis supplied) In order for P.D. No. 242 to apply, it is necessary to ascertain the legal status of the parties to the dispute to determine whether the same is within the coverage of said law. There is no dispute that the Bureau oflnternal Revenue (BIR) is among those enumerated in P.D. No. 242. The issue lies with the legal status ofBSP as a government entity. After evaluation of the facts, applicable laws, and jurisprudence, it is my position that the BSP is a government instrumentality. Section 2(10) ofthe Introductory Provisions ofExecutive Order (E.O.) No. 292, otherwise known as the Administrative Code of 1987, defines a government instrumentality as follows: \

DISSENTING OPINION CTAEBNo.2680(CTACaseNo.l0106) Page 5 of8 SECTION 2. General Terms Defined.- Unless the specific words of the text, or the context as a whole, or a particular statute, shall require a different meaning: XXX (I 0) "Instrumentality" refers to any agency of the National Government, not integrated within the department framework vested within special functions or jurisdiction by law, endowed with some if not all corporate powers, administering special funds, and enjoying operational autonomy, usually through a charter. This term includes regulatory agencies, chartered institutions and government-owned or controlled corporations. (Emphasis supplied) In relation thereto, Sections 1 and 5 ofR.A. No. 7653 (The New Central Bank Act) provide as follows: SECTION I. Declaration of Policy. - The State shall maintain a central monetary authority that shall function and operate as an independent and accountable body corporate in the discharge of its mandated responsibilities concerning money, banking and credit. In line with this policy, and considering its unique functions and responsibilities, the central monetary authority established under this Act, while being a government-owned corporation, shall enjoy fiscal and administrative autonomy. XXX SECTION 5. Corporate Powers.- The Bangko Sentral is hereby authorized to adopt, alter, and use a corporate seal which shall be judicially noticed; to enter into contracts; to lease or own real and personal property, and to sell or otherwise dispose of the same; to sue and be sued; and otherwise to do and perform any and all things that may be necessary or proper to carry out the purposes of this Act. The Bangko Sentral may acquire and hold such assets and incur such liabilities in connection with its operations authorized by the provisions of this Act, or as are essential to the proper conduct of such operations. The Bangko Sentral may compromise, condone or release, in whole or in part, any claim of or settled liability to the Bangko Sentral, regardless of the amount involved, under such terms and conditions as may be prescribed by the Monetary Board to protect the interests of the Bangko Sentral. (Emphasis supplied) Based on the foregoing, the BSP, granted with corporate powers, functions and operates as an independent and accountable body corporate. Moreover, while it is a government-owned corporation, the BSP enjoys fiscal and administrative autonomy. The BSP, thus, falls within the definition of an instrumentality under the Administrative Code of 1987. \

DISSENTING OPINION CTA EB No. 2680 (CTA Case No. I 0 106} Page 6 of8 In Bangko Sentral ng Pilipinas vs. Commission on Audit (ESP case),5 the Supreme Court shed some light as to the legal status of the BSP and categorically ruled that the BSP is not a GOCC, applying the parameters set in the case of Manila International Airport Authority (MIAA) vs. Court of Appeals,6 promulgated on July 20, 2006, (2006 MIAA case), viz: In the 2006 case of Manila International Airport Authority v. Court ofAppeals, the Court had the occasion to interpret and apply the foregoing definition in the Administrative Code when it was confronted with the question of whether Manila International Airport Authority (MIAA) is a GOCC and is thus not exempt from real estate tax. In resolving the issue, the Court explained that a GOCC must be organized as a stock or non-stock corporation, as expressly stated in the definition. It further explained that under the Corporation Code, to be classified as a stock corporation, an entity must have capital stock divided into shares and must be authorized to distribute dividends and allotments of surplus and profits to its stockholders. On the other hand, to be classified as a non-stock corporation, it must have members and must not distribute any part of its income to said members. Since MIAA is not organized as a stock or non-stock corporation, the Court held that it is not a GOCC: XXX Applying the parameters in Manila International Airport Authority v. Court of Appeals, the Court has since disqualified many entities from being classified as GOCCs, including the Philippine Fisheries Development Authority, the Philippine Ports Authority, the Government Service Insurance System, the Philippine Reclamation Authority, the Manila Economic & Cultural Office, the Mactan-Cebu International Airport Authority, the Bases Conversion and Development Authority, the Executive Committee of the Metro Manila Film Festival, and the Light Rail Transit Authority. After applying the same parameters, we find that the BSP does not qualify as a GOCC as defined under the Administrative Code and RA 7656. First, the BSP is not organized as a stock corporation. The capitalization of the BSP is provided under Section 2 ofRA 7653, as amended by RA 11211: XXX Thus, while the BSP has capital under Section 2 of the BSP Charter, it does not have capital stock or share capital. Further, its capital is not divided into shares of stocks. There are no stockholders or voting shares. Hence, the BSP cannot be classified as a stock corporation. Second, the BSP is not a non-stock corporation. It does not have members. Even assuming that the government may be considered as the sole member of the BSP, this will not make the BSP a non-stock corporation because the BSP Charter mandates it to remit 50% of its net profits to the National Treasury, in conflict with the provision that non-stock corporations do not distribute any part of their income to their members. \ 5 G.R. No. 210314, October 12,2021. 6 G.R. No. 155650, July 20, 2006.

DISSENTING OPINION CTA EB No. 2680 (CTA Case No. 10106) Page 7 of8 XXX In fine, following the definition of a GOCC under the law and in line with settled jurisprudence, the BSP does not qualify as a GOCC as defined under RA 7656. Incidentally, this was also the impression of the Court in Manila International Airport Authority v. Court ofAppeals. In the ESP case, the Supreme Court further expounded that the records of the Constitutional Commission and the legislative deliberations on R.A. No. 7653 reveal the intent to exclude the BSP from the general category of GOCCs, specifically, that the BSP "is owned by the government, but not quite government-owned or -controlled corporation as defined now by various law[s}". Nonetheless, the above recent jurisprudence did not categorically rule on the legal status of the BSP but only held that it is not a GOCC. Referring now to the 2006 MIAA case,7 it is noted that the Supreme Court, after concluding that MIAA is not a GOCC, proceeded to elucidate on the legal status ofMIAA within the National Government, to wit: Since MIAA is neither a stock nor a non-stock corporation, MIAA does not qualify as a government-owned or controlled corporation. What then is the legal status of MIAA within the National Government? MIAA is a government instrumentality vested with corporate powers to perform efficiently its governmental functions. MIAA is like any other government instrumentality, the only difference is that MIAA is vested with corporate powers. Section 2(1 0) of the Introductory Provisions of the Administrative Code defines a government "instrumentality" as follows: SEC. 2. General Terms Defined. - x x x (10) Instrumentality refers to any agency of the National Government, not integrated within the department framework, vested with special functions or jurisdiction by law, endowed with some if not all corporate powers, administering special funds, and enjoying operational autonomy, usually through a charter. x x x (Emphasis supplied) When the law vests in a government instrumentality corporate powers, the instrumentality does not become a corporation. Unless the government instrumentality is organized as a stock or non-stock corporation, it remains a government instrumentality exercising not only governmental but also corporate powers. Thus, MIAA exercises the governmental powers of eminent domain, police authority and the levying of fees and charges. At the same time, MIAA exercises "all the powers of a corporation under the Corporation Law, insofar as these powers are not inconsistent with the provisions of this Executive Order."\ 7 See note 6.

� DISSENTING OPINION CTA EB No. 2680 (CTA Case No. IOI06) Page 8 of8 Likewise, when the law makes a government instrumentality operationally autonomous, the instrumentality remains part of the National Government machinery although not integrated with the department framework. The MIAA Charter expressly states that transforming MIAA into a 'separate and autonomous body' will make its operation more 'financially viable.' In the said case, the Supreme Court ruled that the MIAA is a government instrumentality vested with corporate powers to perform efficiently its governmental functions. However, even if it is operationally autonomous, it still remains part of the National Government machinery. Similarly, the BSP is a government instrumentality which is granted with corporate powers8 and is enjoying fiscal and administrative autonomy.9 Nonetheless, even if it enjoys fiscal and administrative autonomy, the BSP, as an instrumentality, still remains part of the National Government machinery, as also aptly pointed out by the Honorable Supreme Court Justice Amy Lazaro-Javier in her Separate Concurring Opinion in the BSP case. Thus, the BSP is a government instrumentality. In fact, in its petition, the BSP refers to itself as "a governmental instrumentality existing by virtue ofR.A. No. 7653 ". 10 Considering all the foregoing, since the instant case involves the BSP, a government instrumentality forming part of the National Government, and the BIR, another government agency, it is respectfully submitted that the CTA has no jurisdiction over the instant case. All told, I VOTE to DISMISS the Petition for Review filed by the BSP for lack of merit. 8 Section 5 ofR.A. No. 7653. 9 Section I ofR.A. No. 7653. 10 Par. 9, Rollo, p. 3.