CTA Case No. 3463 (Decision)

REPUBLIC OF TH E PHILIPPINES CO UHT OF TAX AP P EALS QUEZON C IT Y RIZAL THEATRICAL CO., INC ., and AYALA CORPORATI ON, F'E~t:..i t.i.o n c:~ l'"f:5 ~ �- ..... ver-s; u ~:; C.T.A . CASE NO . 3463 THE HON . COMMISSI ONER OF INTERNAL REVENUE, ) !�~ ��� ~ D E C::: I s I0N Thi ~s .is i:<n dppE�al 'ft. �um th E' c::lr.-~cis.i..o n of th e::� Comm i ~;s i. on P ,~ of In t:.e r �n '"' 1 F\c-:-:-�vr? rlt.I.E! a <;:;~=:;c�~::;~:; :i. rl q ''''.::! <::~.i n ~:; t . a nd dern .:~nd incJ t h E! ~=; urn of P1,580,705.66 for 1976 as deficien cy ci--r-l-.c.~. cJ rr1 !'.�.". \.. �-~ J- f"'-'"'\r, I�J.., F' ,.., . ("_-., <,,::,�,,...... ,�..-.�,,.., t h e th~ory t h a t p e t i t i o n e r s a r e in a j o :i. n t. VE~n t.u v-~~ t,'1 )�(,:�,, b 1 E~ ;:1~:; ;,;~ c: u ,...po ,,.. "" t :i. o n un d e ,.. :.?o St-~c: t. .ion Cl 'f t . hE-? t 1\i ,:A :.i. CJn c\ 1 In t.c;~ (�"' f'l "' l nt-~ VE:> I"l U(;! Cod(~> ' ancl s; ubj t:>ct -l:.: u c u��- pur�..�:,\L E� '1.:!:1;-: 1..1.nc:!er.. ~3E>c: tic"Jrl ?11- of d evf.~ l. o p�0 r.. r-c~~~:; :i.d er�, t. .i <::< l C CH!lfll f-? t"' C: .i i::\ l c: urn p l c::> ;-~ 94

DEC I !3 I ON CT A CASE NO. 3 4 63 l ocated in Makati~ Metro Ma nila. I t con~;i~>i::.s ~ a mo n g o t. h e r��~:; ~ h o t. c~ l ::; , ~::; hu p '::; , co mm e rc i al e s ta b l i s hm e nt s. For th e purpo se o f h avi ng a co mp l e te and i n te<J r-ated r� l'?� :; .i d t-.cn t. i a l C:: CHTHTl ('? r�-� C: i <~ J. c:ump 1 P >~ , p et i. t. i o n e r��� Cor��p or �a t..ion C: C) n str��uc t.'~cl a.nc:l mai n t,::'l.i. n e d wi t .h.i. ���, t h (�:? cnmp l (:�:�: s; .i.:: ( 6) m ov.i.c-:-~ h o u s <;?::; n a mely: the Ma g a l l a n es Th ~ atrP, Ri z al T h eatre~ QUAD Ci n ema O I_.J ( ) 1) C: :.i.. 1"1 E~fllc'\ DLJP1D C.i.r1c~ m a "'nd Ol.J()D C .i. n e rn ~::\ 4. T h e"! p u ,,..p oc.:;E2 C) �f pt::Y t :i.. i1.:". or1 F' ,. .. t1y ,;�, l a Co,.- po r��"'' t .i. o n t h E� movi c'! hUU 'O:; (�?'::; in q t .l. c:� ~::;t .iu n. rlc:cc)r �di n q l y th<:�? "3<'~. ic:t c:o r- pu r��a t .i. u n c:u r r t.r ��act!:?c:l t h E� p �:? t �. i. t iu n c!r � n:i. :::: -'.<: 1 In c: .~ t: u fll i:l n i:'\(]E~ <�~. r�1d O j JE' r�� ;.:~ t. c� t h e said t h ea tr es under t h r Pe F=-or� t h t:~ y t:~<::\ r- .1 976!, ( i:O\) l::.h F~ F:i ;�: i:\ 1 Th E�? ,::~t. r- Q l'-1 <':1'::; ma n d(J l=:? CI a nd u p F~ r �a t.f:2c:l by t:.h�::~ F( .i. z '" 1 T.h ~~ '''' t ,....i c �'" l Co . , In c. , un de r an exte n s ion uf a n 11 Opc2 r��"'' t i n C.J <:~ n d 1"1 ,:7\ n a.g e m c~ n t. Cont. r �<''\C:: t 11 E' :�: E~c:: u t ('?d un ,J ;;:~_ n u t~. r,�� y ~:":~ ~�.i !� 1. c7 l !.J. ( E:-: h .. "E" ) ; <::\ n c.i by 95

DECISION CTA CASE NO. 3463 .. ) l"lan<::\g E! me n t. Con t 1,.. a .::: t '' , t:~ :-: E~c: u tl~d on De t.u I::Jpr�� :? 6 ~ 197~:~ ( E::. ::h . G II ) ~� ( c ) the Magallan es Theatre was managed c-~nd opP I'�atE'd undf?t-� r.:~ t h i. r�� cl ''CJp E~rat..i.nq C:"\ nd l (E :-: h . " H " ) .. l"lan a~J c m E�n t Cu n t r� i'.\ c: t '' i:'\ r��E~ p 1�� <::~ c: t .i c ,.,,, 1 1 y .i d E' n t .:i. c <:~ l � They pr� uv .i d E'c:l fo r� tl �ll'? u p c�:~ I'""C:\ t .i. on u f thE> s :i. :-: ( 6 ) Th E?<"='� t .r� :i.c D. l Co., Inc. c:c-:' r- t,:;, :i. n pE~ r�c t.�:-~n t ;;,,g e of t .h E:' '' n E-? 1:: pt�o f j_ t s; '' f r� orn s u e h opel'�d t.:i.on s. ThE! "l:E' I'" fll ''net-. pr� cJf.it ~":; '' , CJn -l::. hf') h<.;~~;.i.:::; of \'II h i c h t h e <:\ fllCJU n t of t l�l(':' m ,::~r l .:::\g l:�?fTlE' n -1.: f f-?'�'''; 0::1f the::- dE?gl,.. t::~c u f cJ<:-:!f .i.n.:i.l: .ivE) I "lE'~oi!.-5 i n tE? r�� m '' n f:? t p r�� o f .i. "l: ~:=; '' ( f r�� nm t'l 1�1.1. c:: h -1:.: h E~ mr.:1 n <::\ q (;?fTlE~ n t �f f:�?P<::; wer��e to hE! qu ,:~ nt.i fied ) 'i~ i':\ <::;, .i. n ~"-;uhs;-l::a n c::l?, c:l~:~f.i. n<:::!d b r.:~ l c:\ n c:E' fr��orn i.ncume ~� df?cJu c t .i.nq t h E.' r�� c7. f I,..<Jrn C::F' r��t c:\ j _n ~; p c�c: .i. f i c:: e ;.: pend i. t �. u r� E~~::;. rno v if.o>hou sr:?~:; bu1�� n f.0 p,::~ .i cl �for�� a l l e:-:pen ses not s t.i.. pul<::~tE'cl 96

DECISICJN CTA CA SE NO . 3463 ... <l '" r:?:�: pen se ~; dC':!cfU c: t i b]. 1::' �f I"'CJ fll th ~ o pE'! I�-�i::'\ ting inc om ~:?. I t .i. ~:; c l l�?i::\ I"' 'f r-�o m t.: h e! f C:J I'' F'IJ o in q t�.h ,::\ L�. th E�:~ " net. Pf" (J f i. t.~:; II had r� E' s �L.I'" .i. c:: t .E~ d illE! c:,.n .i.ng exclusively for us e a nd purpo ses of t h e ma n a g e me nt C CH'l i':.l'" a C t ~;; " The only 1ssu e involved in the a bove-entit l ed c a Sl�? i s ~"i he:> t h E' I"' c ,,. not t. h r:.~ r"l~! 1 '"' t :i on~;:; h .i p Li e t\I~ E:� c?n R.izal f.''.. o . , l n r:: , d l'lc:i thP a corporation und e r Sec tion 20 of the Na t io nal Internal Re v enue Code. Petit i o nE� 1'-<.:; clu r-ing t 1 �1 c-~ :19 7 6 t: r:.\ >: '' b 1 E' yr;�,;,,_,... i r1 q u es t.ion h <3 d filed their se p arate a nd di sti n ct i n co me t a :-: r- E~t: U I'" I' l t.h P..i t'' incomE! l i a b i l i t i es th e r eu nd er. ThE' :.t. r:; 7 6 cl E�~ '(' .i. c: :i.E~ n c y i n c:: c:Hncc~ in quc~s t. iu n .i n t:he ~; urn u�f F'1 ~ 580!,705.66 s pn..tng 'f l'� om t : hl�:�:! l o n e..,~ is ~; u~~ C:\ <::; to themse l ves into joint ven ture . I t _, l.. C:' pet.i ti.one t��s ' thE?OI'" Y th i:~t. t.h n r-e ne ve r- a joint t h i:' t c on tr�,:\c ts E~)<F.!C U t e d l,."iE'I'"E! �fo r- t:.hE~ the ::;:.l.:< ( b) rno v.i c?h rJ UcoG?<:'i <~nd v~F.! I""P 97

DECISJU!\1 CTA CASE NO. 3403 fat- s; impl!=.! c:urltf�.. a.c:: t:s of <'":'. 1 t hnt...l CJh 1:. h e,� a. mount o "f t 1�1.::-:' c: um p~:~n ~:;at: :i..on -1::. h r> F\.iz D l Th F'-�'!. tr�� i c<''. J Cu . :1 Inc , w e:~ ~-:; c:l e p f.'!rl d l':! n t un t: I' ll'? 11 r1 e t : p r�� o f .i.. t s; '1 :-:~ ~o; cl f? t :p r��rn .i. n c~cl i n a c: curclance w i t h 1:�. h E" "f 0 l'�� rnu J. <"~- s; 1 .::1..�.i. cl ..in Cln t . hE~ o t .i l C~ r�� l!i':l.l"l d ,, �.i. t . �'�� <:; r-F' '':; I:I O n cl c-:Tl t � s c: l c:\ i rn t 1-l a t t h t-::' SE~ pE~ t ..i t i on E",.--,,; 'NF'r��r-:' c ur �l ~:; t :i.. L1..\ -I:.� E�c:l in to j o .in t:. venture an c:l that c ontr0ct s Pnt e r ~d into b ~ twe e n Ayr.:\l i':l C c�r�po r�-;:~. t�. :i.c> rl ,':\ ncl R :i.z i:I J T"hF~t.lt. r� i_c:.:'\ l Cu . .1. n c n ~ a 1 t: h ouq 1�1 de"~; :i. q n .~�. t E-'d .::1::-; �� D p E~ ,... iJ. 1:-. i..r �l ~J a nd t"! i-:\ !.., '"~- rJ ~;! rn c�n t i::>. rl c:i t_ h ,:;l. t . -1:. 1'\ (-:-: c:;,:,I_IHF1 c:� i::.>U J d rl U t �. be:� (. I f:~r�l Cl fll j_ !"I .::.\ J. �. c~ ci ;:1, '':i rnr.~.n E:lf::J e HH:01"l t:. c c:>n t r��� <"~C -1::. !:; , T h ~ t f.' t..�rn 11 r:: u ,... pu t�. i':l. t. ion �::; 11 f n r.. t.: h ;:., pur� pO !''i F' u "f -1::. h e� .i.rl L l. L\I ..IP nc>+". u nl y co r�- po r�- <::1t: ion~:; o r��� I.J d n .i. ;,~ E~ d u.n d f~ r. l.. l! t;~ Cu 1� pur_... ,,,, t .ion L i:':lt�! u r�� D l'" Ul"l t"' r"IJ .i..7.:i t �E~ I' ' f "CI p -:":1 t... 1.: l'l r=-~ r� �;;; h :i.. p , limited j D.i �-! �1.:. c.:;t.o c f.-: C: Dfl'l p i:':lf'1 .i.. F'3 , .i. l"l ~:; U 1'...;,~. f'\ C: f::o' -:3.S '"\f'\ ; ,1_ <::;!s r::>c: .i. ''''��1.: :.i.. o n u f pF'r" ~:; o n <;:; \�! j_ t h {�. h i::> .i.n t. c:::� 1�1 �t., h�r 98

Df?.:C I S I CJN CTA CAS E NO. 3 46 3 b "'' way o f a c ontr act ~ expr e s s o r i mpli ed, to en gage in and c ar� 1~ y out '"' s-i .ngle or� j o i n t bt .t ~:; :.i.n er,:;s v enture:-~ tor� ~'lhi c: h th e y c:: ornb :i. n c! t. h r:> i I'" p I'" O per� t i es:;, monE' Y, s k i l l c,;., <":l rld k n 0 \'11 r?c:! g e !' ~,,i t: h o u t cre a tin<J a p d r.. t nE~ t-� s h .i.. p or- <::1 c:c'r�p o r �<:~ -1.-..io n , pU I' 'S I..J. ,':\ nt int E! I'" e~; t a rnonq t: h e m s E~ l v<�?S <i:l '::; to t: h r=~ pur.. p ose Df th e underta king anc:! th a t e a c:h jo i nt ve nturer s h a l l a s to each of th e o t h e r co -v e n tu r e r~ w .i.. t h a n eq u a l right of c ontrol of the mea n s e mp l oy e d to carry o u t the common e n t e r pri.se . To c on ~=; ti. t u. t: e <:'\ j o i n t. v <�:~ r l t:. t .ti'" E~~ '!::. h e foll o lt~ inq factor s mus t con c ur <::\) A c:ontr" ii:Ju t.i.on by t.h E:�~ p.::ll�- tiE' ~:; of money , c omrnon un d t=~l'-� t '�' k i l"l (J ; b) A j o i nt. pr�opc-e l�-� t.y .i. nt ��~ 1'- cs t. i n th r:~ ~'5 ubj e ct rna t ter� o i ' t he v1;:~ n 1�.u r.. <~ ; c) (~ r �.i qh t : o�f mutu <:\ 1 c ont.I'" Ol CJ I'" rn ,;,. n D.q<:?rn e nt of the enterpri se ; d) An e xp ec tation o f prof it , or the pr esen c e CJ f a d VE~ n tun:? ; 99

DEC I~:; I Cll''-1 CTA CASE NO. 3 4 63 e) (I t-� :i. tJ h t. to p ,:.�. r �t .i 1.::: :i.. p ,�_,, LE�' .i..r�1 t: h�c�' 1:l r �o �f :.i.. t ; a ~::;.i. n cJlE�~ t.tnd t::-~t���� t: .:,,_ k :i.t-1 ~~ or�� i 'l cl hnc:: 1,,,,.1t:. ''"'����p r :.i . s~0 ( lt J.i. d;; 6 (I ) , () �I :...1..l..� \/ 8 0.~- e d on t h r:~ ,;�, l::lovE-~�-��mE'n t ..i.. on E~c:l qtt i cl r-0 1 :i..nE)Si !I ,,, ,;:; t .n wh c.:�. t c: on <:5 t .:i.. t. 1�..1. t. f ? ,�_,, �! �.;:,). :�� "' 1:) l. ':' �j U:i.!l �1.� .i. i j _:::; C)l...f. f���� o p :.i.. n :i.. u n Up (�:-' t��;:,, l::.i. nq t Th E~ E:l. I' :i. r::: <':\ 1 Cu . !I Inc: .. !' do.ic:l I l,.) 1.�. .o.i no.i.r1 t vpn t .1...1. r�� e t :<�'�:-: a. b 1 ("' =,~ ~==; '"' <:;; c-~ P �J.r d l�F1 r:: r: � 1�pu r �::1 t .r::�' F' t 1�!.� .i.. -1::. y" {) y i::\ 1 i':'. C or �p ur�� <:1t :i.cw1 h: i :.;: <:t 1 T I lf 1 i':l t .r :i.. (. :,., l Ct> ,. l t l C:: . .i.nd r:�:�~ p c' n c!P t'l t �. c: u r�1+r� .: ,_c: t 1; �! .i.. t.: h 1���c,�q ,���~. ,. d t �. r.> 1::. h e� mc-:\n D.':.r ��:�-~ r P �:::� t 1+:. jo in t VP n t u re was ev er l.� !�l'l U.(.JI �,�:��. r:l f' i::.l�) p p;J. r� t ..:i. F�: :; .i . 11 l.:.c ;���.�\��r...I� I ; � l�o'fT\ L' ! i t " /.Ju.i.. nt. of t.'f'.I D o 1'.. rno r��r ) p�:�:~ r �<.;; ur1<;:; i::.o c: urn h :i n P t:. l �1 c~ :i. r pr-o P'2 r � t. y u r � (~:;F:~ E-~ I< J. i:'II.Jt:�t � \' ,. cJUI'' � '":!'",...' V�l h ,-.~ t .ll f? 1�.. E:\ ...i u .i. r ' t �. n ','F) t:.'. !. ~-� E-' r��:) >' :i.. ::; t .:::; � ., .' ,!: .. II 100

DECI HIO I\I CTA CASE NO . 3463 ..... !:l ..... rnu s t 1 ,,,\ r� g r-2 1 y d e p r;~ ncl upon cl <-:-~ t .c:? ,,.. min .i n q the~ .i.n t�. r-�n i:'. :i. o n ( ~=) pe H o l t ;:-: v .. U l"l .i. t r:~c:l F' l umb :i. nq (i( l� �l e~,�,~ t-. :i..r l CI c�u .. !l l l.c:;� Ca l . 2 cl 50 1 , c i. t e d i n 46 Am . Ju~. ?0 3 1 . ) ,,~ .i l l m; tkr;� .-:~) r') cu nt l'" .i. bu t. :i.on l.:ly L1 1c p <H "t .i.. c<::; (J �f Y fllC) I"l E~ !I !.') r "O r IC'�: [�"� t }-' :1 f.' �f �f 0 I" t . !I k 1'1 C.'I\'J) (�.'' cl 1~.') C'! :; l.n ::;k :.i. l l. or- <'.\':;<:; ct.:; ::> C.'OI11 fll CJ!'I unclt:~ t.. t <:\ k j l'lfJ :: t h i.',:; .i. ~::; c: o r1 c: C' t"� n 1::-�cl :1 fl E! t:. .i 'l':..ion e F"S cl o nut: '5E! r.. i. ou ~.-,. ]. y c: o n t r:~<�:; t t"' (:~<::; p u n d E~n t ' �:::; o �f to CC l illHl i,' II"J undc.'- t"' t .t.t.k :i. t'Jq ,. B,::\�::; .i. c: d J. 1 y, t: h e! (' �>..-.:,:~ 1 :':~. C ov �p n t�� i..\ t .:i. 0 11 u 1::: n t �.r. i h u t.:c-:�d t: I�,F.-' p h y<:; :i.c: <'::\ J wh i l e l:: h 0 Ri.z a l Co. In c. :; �:�url �i:�.r.. i hLt �l:e r:! �t. l�, ;;~ j_ncl t.t<:o;t:r. y .. T h .i ::; :i.<,. n nt. u nJy E! J. e rnc�:~ n t u �f joint '1.:1t:.h e ,,.. C ( l rl <J i t �. i. Dl'l �::; mu <::; t: co n c u r.. , \ll.l h.:i.. c h d u l"l C' t . i'�! )< :i.~:;; -1::... I:J ) ~~, ..i o .i n t . p r �D p c-~ I'" t y :i. r1 �!.E-? r� E-:~ ~; t i n t h r:.-:� ~; u bj e c t�:. ma t t e r o f t h e v e n tu ~ e; c:l) An E' ~< [JP c: 'l:: c:\ t i. U l"' n �f th E�' o �f' a c:l V f'?. f1 t .U I'-E' ; 101

DEC I ~3 I 01\l CTA CASE NO. 3463 (,:> ) A r �ight to par� tic:.i.pC~tc:~ in the::.~ pi'" Of .it; For this purpose, the second~ fourth and f i f t h elements of a jo.i.r1t. ve ntur�e, t,Jill be d.i.~;:, c:u~~;~,,ec:l hen:~ i n b!::> 1 D\'1. There i s a bit of uncertainty as to what constitutes the ' ' su. bj E~c t rn <3 '1::. t .e r. '' o �f a YE~ n tur-E�" / Th e '' subjc~ct rnattf'.! t-� '' of thE~ pr�!'?Sent YE~ntur-�e v may be 1) thE? phy !:'; ic:t..'\1 -f <::IC: i J. .i. t .i l:?~5 of CinE�~rn.7.1. e:�:h.i.I::J.i. t.i.on bu~;inc~ ~:;~; invol vc�;�d ; or� ( ?) t .h e .::1c: tu;,, 1 ''opc~ l'" at.ion~:; fot... pt..�c)f:i.t.'' o'f' t .h E�? bu r:;:i. nr�?~;<;:;, A~;sumi.n~J t.: h F~ '' s ubject m <olttc:~ l'" '' u'f' thf? vE�ntu l~c~ ( to be the ph~ '"s i.c:i:'\1 �fac:.i.lit.i. E~s ~ ther.. e .i~:; no quE~~:.t..i. on that ~5 ...li.cl sole l y and e:-:clus.ivr::�ly to the� Ayala Cot�� por.. at:.i.on. ThE�? F~.i.zal c: on t t�-c:\C ts �for m.::1.n ,::tq em en t , o b td .i. n .::~r�\ y in tE�r�e~; t in the said properties. (. On the ot:.het�� h e:1nd ~ .if thE� "subject matter" rE?fers; to t.hE~ opet��,3t..ion n �f th e bu s ines s for� profit, the Ayal a Corpor-,3t.i.on, he.,~:; 110 vo.i.c!'? in thr~ 102

DECISI ON CTA CA SE NO . 3 4 63 :.t o s <~id op e r��;::\t.i.on s � Nut onl y th :i.~:; ~ i t h a s no ,,..(2.:�~1 .i n t~~ r� es t in comm o n ~'\l :.l.t h t h e::! l~.i ;'.<':"l l. Th r:! at. r�� ic<"l l Co .. T h r:? rn c:1nag r.? r- (F\.i ;!a l T h t-:'<1 tr�� ic:: -.:~ l Co . , In c.) h a~; an .i.n t. e ,.-� E? !"5 t i n 11 o p t-? r��"" t .i.. n q j .ll C:O fTll2 11 o�f ve n tur e as i ts rn a n ~ g e rn e nt fees were qu a n t ified f rom th e a mount of sa id o p e rat i ng i nco me. v Th e tr.-?1'-m nu 11 opera t .i :.L n c nrn t::> 11 !I ,3 <;:; u �::; (�::> d :i. n t h F! c: o n t: r� ac: t. s ( '"' ~" basi s of t. h fi! c::ornput i'.l. t: :i.n n o �f t hl:! rn p l�l c:lqF?rnl:':!n t. �f tc.-'E~r:; ) :i. s not sy n o n ymous~ how evE! I,.. ~ wi t .h the of a join t ven ture ) . may , in fa c: t h E? a f i. na n c .i '"' l �f '"' .i. l u r-F' ~~~ h .i l E? s t. i J. J. pr�ovid i ng II u p E! r��'"'ti n g .i. n c:omC? 1 ' ma n ag E! I'.. t o Jrnp E! n <::; i.'l t: iu n . T h .i. s several e:-: p e n <::;e<::; of th e v e ntun:;.' an;::- not d e:? du c ted f r��om th e q1'�os ~:; r�� t::!V!:> nt...tf::> s i n ,:;t.r- r-.i.. v i n c;.J ;,:~ t thE.? a mount Su c h expen ses in c lude s u ch i te ms d e pr-r.!c .i. <:l t :Lon, t. a :�: e s , s t. r-ue: tLw a 1 l~ enu v <:>. t .i.o n s. "f'h .i..<:s i.e; und e 1��<:;t and <::1b 1 e w h e n thF:? objE!C:t. of Ay a l a .i. n enter-i n t;) into c on i::r��,':IC: t 103

DEC I SION CTA CASE NO. 346 ~ -- l.l �r h 1:-� ..i.. cl r:� .,'~- ,,\, a.~::; tu f \.t.r�� r1.\. ,,,; 1�1 t. l�lr:' c:: om r> 1 F~ :: with fa ci lities tha t would draw more peop l e in the �r c:: om p 1 E' :< <":, nd pr��uv :i. dE~ f" l 'l -l:.:c~ t- l:i:,l :i.n fll(' '�r l �1.�. r �r � p \'.' U p J !'-~ :i.n +:. h �':' not tu r��r:o,,�.,, p p r �u f .i. t: ~:; t : h�"! t�-(-~ f ,,.. c�rn 1: >�...1�1. "1:: o p t-, �, v i. 1.::1c:-� a. ':;f.~,-�vic:E~ tl�1,:�.1t v~c:�t.t l cl fur- t:. h E�! !�� '' do:c:�vt-:! lc >r �' ' t. h f:~ cum pl F~:< ,.~n d m<:l k !�=~~::; .1 t mu l'"c:~ rn,,~_ ,... k F' t ,,,, b J. r -~ i;;~. n c.l v t.\ lt 1-�:'!. IJ 1 c" I t did 1"1''\ . � 1 1 <-:~t.! �. !�:! .- � tc 1 Lh P t'ly :�. J. ,�,,_ C!Jr-� p or �i:':l. t .i. url (w h o P "!.:i.�::l 1-. � 'F' n Ll �!\::'! 1'" ;:��~>: r:' r�� �,c; !:'::; �: >f I ,,,..! vc l �li.:tl l"t-.' no!:: r-~-::-~c: k on t::� d a ~::; 11 cl F'd uc: t i u n ~:; f v-orn (] r � n ~;; ~::; :i. n c:: omF� '1 ) t h,�:'\ t . t. h E' v e n t .1.. 1t"" C�' �.">JUI.t l d t r�to~ ~:; u 1 i. n t� 1 �~-:�11 T' h(?y b1-:0 n !�?�fit.~:; 11 for- l l IE! r:: urnrnc ,... c: i ,,, 1 c:ump l r-:-~ :-: .. n ut. .,j "F't'"O f:i.t.<: ; �f r-C:Hil t:h F~ Vf'! l"l t U. t""E' '' c: on tr-ac t ~:; On t:hl~ othr:?r� h-:3. nd ~� "0 p l:�? !'"~I t i 1"\ IJ :inC U if\ (:' 11 n Cl -1::. " f.:'I' "CJ"f i t:~'i �f I'"(' HI\ t h e:� VC I '\ "i::. U. I'" (:,.~" n was t h r::-� p t'" :t. rn ,~I. I'"Y c:: D r\~:; i c! 1':~ I''<'!. t J. 0!'1 0 f :i. 7 c:\ 1 T h ~'~��':\ I.:.I'" j_c: <:\ I Cu., Inc:. 104

DFCIGJCJN CTA CA S E NO. 3463 .1 2 ..... it \\10 1..!. 1 cl had E:lnc:l 110 L :i.I'\ l:. E~ r��� E~ ~::; �!::.~;;; " c) (.~ ~-�� i.(~tht. cd ' mt.l t .u '"' l c:n11 Lr �r) 1 c:n�� ma n age ment of the~ e.~ t �1�I:.L' ,,. p r�� i !oiE! :: Und E~ ,- - the~ ()y .::) l "'' i':1ppo :i_q t.cd -'Jnc l c-.1ncl Co. ~ Inc . LUI ' t ,,. (:) ] ,,1.. 1 ' I " c: �;n;. :,��~-�� I ;-)I -r;_~) .:':1 l 1 .~.n f'."�' s; u p!=~ r��v' i ~=; p i::l nd -C'X l il <::; p r��v i. c !-:-~~'' in c: u n ' lP C 1.: i. i) rl ~,, j I I , ,.,1: ~::' '"�'! 1r? ,~� .J. I .iun j:) r��c �p (;~ r- t.llt:' r�f?O f � related se r vices �t' nr�� <?:lnd .it~:; n �.-.-'n Thu.s. negoti a tion s a nd m~king arra n gements fer h iri.ng, 105

DECISION CTA CASE NO. 3 4 6 3 1 :;:; �-�� lei'.l.s ing movi E) th e�~ E.\ t.1�� i. c:: <:\ l a nd oth E1 1'"' pr��f.�? s c-'! nt .:�,\tion<_;; lE'<:~s.i.n<J of th E�~ lobb y ~; p E:\ce o f thr:' theatre and the s upe r vis ion and control o f tho act :i. vi. t :i. e o,:; o f �l:E'!n a nt s rt<;?~1 uti'"' t .i. o n con tr-ac i::s i :\ ~:; 11 t-? c: I'!S'::; <~ r-�:i. 1 y in opE.' r-� ;:,\ t: .i. on of l .h E� hu s-, .i. n E~ ~:; ~:; " '�1�1d <:1 l 1 i. eel bu ~; :i.n E' S ~3 E' ~:; suc:h a s , but rtnt:. l :i. m.itr?cl t. n , .::\ci VE~r� �t ..i. ~::;.i.nq pr-o m o tion~::; and the like, a nd t h e purc h ase n f s u c h s uppli es and in VE~n tor- i. E�' <.5 i:1 S t �.o pr-op~'?r- 1 y mr.1: :i.n t <�:\ .in thr? Ev id f'? n t l y, I the�? taxpayers did not c r e ate a right o f mutual c ontrol in rnan i::I.IJ F' fliC�: I-1 l: t. h f�~ C? I"'I -1: .f.�'Y I-� p t' . .i.. ~:; C! " f\:i. ;: a l o p e l "�a t . i o n and f) l.J<::.t..li':\ l J. y , '"' 1 L m.i. t '" t..i u n n f i::\n l..l.n r:J f:) r. t:.ro<. f:: .'i.. n I;J () t'" c':\ ci u b j e c t: i v c to "" ~':; .i.r1q 1 E' b l''lc-;: 1�� t<:~ ll 0'> :'!;5 " 0 ~'1) ; ho c en t.E! I'" p r-� i. ~;r;, ( ]: .tJ:i,�} ; A s ingl e und e r t ak i ng ; a r a nd o m pro jec t; an isoJ.atE'd +..:r- a n ~> <:\ cti.on. T hr.�?C:i E? ''" 1��e t. l~ r-rn ~:. t h i':\ t wi 1 l V.Jh.i.le th E'I'" P h c:\c:l been rn any such s ingle undertaking s held joint V E! n t u 1'" �?~5 in thi.o:, jur- i s d i c t i o n , t .h e bE~ ~:; t. :L llu ~; tr-a t.i.on~ s o i' ,::\r- ~ h a~; 106

DET~ I H I CJ I\I CTA CA SE NO . 3463 .14 -�- been th e c o n tributi o n of money to a co mm o n f u n d tu buy lotte r y tic k e t s. I n t h E-~ pr� c~c~r:-� r- t: c,,,,~::�.f�~~ 1.�. 1-l P ci ':.:J '�c:~(~i � i! � 'll t~:=; ,�,'\n!:l ,:�.,c:t u <-~ .1. pra c t i ce ~:.. ho ~-'1 t:. l�1a t th E�' .in t E~ n t.io n o f t. hf.;~ p i.:l l'�t .i. t:-::�~:; ~"' a~==; n ot to E? :-: hib:i.-1::. r�<.:i nc:l o rn c::i n E~ m D f ilm ~:=;. F~<:~ t h F~ ,,.. ~� t .h e~ i n ten t .i o n ~'Ji:\<::; '1:: 1:1 p ! �ccc~ - ~:~ nl � �t�.u t.l1c-~ cun liHr~r.. c:::i.i~l corn pl ~:~:< c:onti.nu.i n q co n t .:i.r1 u :l.n q �fac i l i ty. 'i::.o pr� uv .i. dr-~ E?l'l t E.' I"' t. a .i.n rTl P I"\ t. f c'\C: :\. J. .i. t. i f.-~'3 U I'" C: :i. l' l F'fll :':\ i�lUU ~::;F~~:; t :.U t h e~ c o rnrn te r�c: i. a 1 camp 1 e :-: p at r-o n ~; o n ''" con t .i. n u :i. nq b ,~, ~:; .i. :;:; ., I t cl.i.d n ot rnat tc;' r- ~"'i�l ,,::>t h !2 1" ' t:. h c~~ G}:-:h.i.b:i.. t ..i.o n o �f c:c:~I" 'Li::�..i.ll c:: o rn p l e :-: t h <3 n o t. 1�1E' t... �f i l rn �::; � D. t .-1..: ,... ,'�\Ct. ion o �f c::o rn p 1e :-: � T h f? Vc: o n t:.!"" iJ. r: �1.: ~; , t h pr�t?fUt"'C', ,..~ n v .i. �"'; :.i.on E'ci f::. i�l ;:~ c ont i nu o u s ti! :-: h i hi t i o n o i ' f .i. 1m ~::; mov :\. !-:-:-~ h ou <:;;~:~~::; o �f t h E~ c o rn mel'��c: i. a 1 c: om p 1 e :: � A p er ma n e n t a nd co nt i nu i n g f eatur-t�? o�f t h e c o n1p le:-: t:?:-: h :i.b:i. t .i n q cirlf�? mi:> f .ilrn ~"_; o n E� Th E� p t�� Dj ec:: t . ~�Ia ~:; n o t t .h E�n-? f o r �E0 l.irn.i. t.t-?. d to th e~ E!:-: h.i.biti. o n o �f t i l t:~ ,.... anclo m f i l m . q) A d uty to s h a r e t h e losse s. 107

DECi f3 IUI\I CTA CASE NO. 3 4 6 3 1 5 ..... the re Gny indi ca t i o n t h a t Riza l / Th eatt-�i c: al Co .. , In c. ~~~.:A s i n tE~ rr c:I E�:~ d to p i::l r'� t .i. c: .i.p <:,\t c-~ .i.. n T o t h!~' c: o n t: r. "'' I'"Y ~ t h E~ :i. n t.E~ n t. .i. on ~:; t o a b ov f.�? pD ~:;s .i.b l E~ lo s s c�? S ~; h o u1der- E�d s olely by th r;.~ o wn er (A).' a:t .:,, C �:J ,,.. po r� a t:. ion ) .i ~3 i rnpli c�:~d .i.n t. h r: ~ c on t r�-� ,:Ac: t~>. I t .i. s h !7) 1 .i [:~\ 1 E? d th a t t h i s i s o n e o f th e rnCJ s t i mp ot-t .~ nt. !':'1 r? m <::~ nt. ~; o�f j o i n t V (;,~r rl: t.tr'��c � .. I;Jh i l E�~ nu e:-: i s t e n c e c:: on t�. r.. i�:IC �1.:.~:; , i nte n t i o n pi:\ I'" t .i E~ ~:; .i. n t E'~ n t: ion n o t . to h <':1 v c0 f~ i z. <:1 1 T h r:-} d �i.� r .i c E:\ 1 Co .. , I n c: .. S h EAr�-r:;:~ .i. n t. h r:? ] u �;:;~; =.! ~"C; .i. s; E'Y .i.c:! E' n �1�:. f i"' i..!il\ : to t h ,;, t c0f �f Ei~ c: t:. � T h e contr ac t s H r e , o n t h n i r fac ma , si mpl e contra c t s for s erv ices .. a n y i n t e n tio n ~:; tc� h o l d F: i;:-~c::\ 1 Thr?al.: r-�.i.ce:'\1 Co . , In c:, 1 .i. <:1b 1 E~ 'f' O l'" ,, n y J o ~::;::; , t h e�I'"F' �,'-JCJU. l. rl 1-,,-,_\ir:�:�� h �-:� e rl ,::~ c: 1 E? <':\ r- o t�� o P~'~ ,,. at .i. n g i n c o rn E! ( f o r pUr'- po s e ~:; of s t i pula t c~d to b!~ d <-? t~? r~ rn i n E~ d evcc> r-y c ,;;~ 1 C�? n cl <:1r��- �.,- p,;;~ r- .. 108

DEC I ~3 I UN CTA CASE NO . 3 4 6 3 ..... l (; T h r.0 �::; t .i. p u 1 a t i. o r 1'3 r� f:' "'' d '" ~:; -f o l l cJh' ::;; ~ EXI� II E! IT E ( f o t- 1�\ J. ;::,:~J. T I1 E' i:l t l�� r::> ) 11 4 .. 1'�1Cl. n r:\l;:JE�'fn E' 1..1 t. F t;? e . .. Th E~ nt:�.~ t. income s h all be determined evP ry calend a r ~::;r::> mc"'~ ~.::-te r� , t h a t i s , ~Jr- ov.i. ::;.i.o n a. ll y o n .Jun r:~ ::::o .::~ nd �fin a.l l y c.1n D E:!C: em h E' I' ' :::: l o �f F!VC 1�y 'y' �:":' ~3. t'~ a � " II EXHIBIT G (For QUAD Th e atres) '''1� . 6, �r1 �11:? Op e l-�<�:lt .in q l n c r ,m r? ~:; h <:~ll h e:~ cl c:~ t~c I' m:i.rH-:�'~C I ( ) \/ C�:~ r� y c r'':\ 1 C? f l d i'\ I"' <::;c~ fl t(-'1 <;:: t t-::~ I'" ' t h i.~ L .i :::; pr-o v .i.. <:3 :.i.. u rt a l. l. y o n ,J u n F~ ::::; 0 !' i�:l 11d f in '" 1 l y on D E'C:c:-!rnh E~r- 31., o�f e <H.:: h y c~D. t... . F'r- op c~ r- r:~ccou. nti.n c;J <''H1c:l p<'I Y fn E~nt s h,�,~].J. h F� n1<::1dt:-? b y THEATRES to AYALA within t h irty (30) days u �f t hr:? c l os.;~:::> o 'f t::! ac: h c: a 1 E' n d a I'" f:O f;�m r::~<:; tc? r- 11 11 4 � 1"1c:l n "" ~~ r,~ mc~ r1 t F' c t'? � � � ThE�? n c-~ t. c: r:':\ J. encJ r::\r.. income sha ll be determin e d e ve r y on .Ju.n e o �f E!V f ?r- y ~;r,? rn e~:;te r� , t h 1::tt .i s , ~,~�- o v :i. ,;; .i.on i':~ ll y ::::;o �':Inc! f :i.nal J. y o n D e:,�c:t-::! mb P I'" 5 .1. , Yf7~.C:\ I'" II " II If I t i ~5 c 1 E~ <�,, 1� � �f I'.. urn t-.IH:? for.. (i:!qn.i.nq t h a t f:<, h t::J IJ ld , J. OSSE? ~5 be in c u 1��� r�c? d 'for- an y ')/ (:?r'~ t"' .i t~ IAI OU J. cJ not b t~ covc_, r-E?d by pr.. n f . i t <::; .i. n th E' �fo11CJ1t~.i. n t;.J )l E' i'.\1'-, ThE�~ 1 OS~St?S 0 'f 1.� h E:? p I' 'E'V i OU ~;; ')/ E~c:\ r .. , t h (:~ I'"C' f Ot'" t-:0 , ~-~ .i. 11 n Cl t. dirnin .i.:.; h als o the manage ment 'fe es) 'for t h e fo l l owi ng year .. -~ h .i.s c:lE' i:':l. lr� J y i.ncl:i.c:at c�?~5 th c:2 .i.rlt f:~ nt.i o n s o �f t h e:~ part ies to s hield t he manager ( Ri.zal Theatrical Co., Inc:.) f r o rn l o ss es. 109

DEcr r:; rm,, CTA CASE NO. 3463 �-- 1 7 ��-� In thr= clr?,::\ 1'.. <:~n <3ly s .i ~:. , t:hc~ pr � nvi.sio n ~:; o �f th E' s;, u bj l?C: t Ag r- E~f~rnen t ~'; do!'.?S n ot ~'li:l 1'. r-D.n t. t h E? c: on c:: l u ~:; .i 0 11 of the E!;-(.i,~; t(:! n C E? CJ �f a tc:\;-( ,:\bl(�~ jo:i. 11t:. VE'f'ltUI'"E' , , / At this j unc:: tut-- E' i t mu s t be ~:; t <-' ted th ,:;l t: in v i e l'i o f t. h E? c:: l E? at"' cH1d E')< p 1 .i c: i t in tE:-~ n t i. o n of thl? parti es to con s titu te the Ri za l Theatrica l Co., t Inc .. <:~ ~:; c:l �. .;:,~ I'"E~ 11 Cu n r� ac t:u,::~ 1 r�! ,�,~. n i'I<.J ('? 1'.. 11 , t h r:0 F\ .i ;-: <:11 Thea tr� ic,:~. l Inc. i t lhu ~_:;, i.~:; \�,Jor- t h tu r-r:~c:;,,11 o f t. l �1 c~ clec::l,::~t�-atiu n our� S upr-(:-:~ m r:~ Col..\ I" t: whr:-? 1�1 i t r-u 1F'cl th i'l �1�. 11 ;-: :-=: (~ �::; ::; r.::-' ''" <:=; mc" n t. �f :i. :: r:0 ~:; <::In d ; -: de t:.c~ r-rn.i nE' C::; l:: h r.-~ t.a :-: 1 .i. i':l h .i. l i t y of .::1 t. '"' :: p c�~ y E? 1��� :.:1 n cl a �::; <::. u u n d <:=; :.i. t .1. <.:. ~"; c-:~ r-v r:-~ cl ,"\ n o bl.i.q c.~ t.i.u r-1 e:\ r-:.i.~"it:? ~=:. o 1�1 t.l-lF�' p ;-,,_, �� +�. of l:.: h F~ t<:l :-: pa yE~ r-� c: o n c: (;~ r- ,-1F~ cl tn p ,::~ y t .l 1c i-:~ rn oun �t �. assessed and clem a nderl.. He n ce, <::~<::;~:;c:, =:;~:; rn r:? n -1:. !=; ~:,; h uu l cl 1�1ot. i:JE-? b .::~<::;c:-~ d on mr:?r-c p l'.. e!::; urn p t .i. un !:; n 1-::) rn<" t. t �?:.' r h o 1,-~ lr' t-? i::l -::;o n i::-1 b 1 E'? cJ r- logic: c:\1 said pr-E's urnpt ionr::; rn ,:-,,y he~ .. 11 "In to => t i::\ 1'1cl .i. t ~:; judic.:i.r.:l l sc r-ut .in y ~~ t: h E-~ '" ~::-,c:; r'?~::;<::; m r," r1 -1:: nll..l~:; t . be b,:\SE'C:I on <':\C tt .la 1 -t' ic\C:: t !::; .. T h E-:-~ p v- ,,.-! ~;; u m pt. :i. on of c orr ectness nf a ssess me nt b ej ng a me re pre s umpti o n ca nn ot b e m~Jc to rest on ann t h e t�� p r-E-?St.trn p +: i un � 11 ( [l(~ n .i. p c.~ yCJ v s; . Comrn i ~;<:;ion"'~ '-- u f In t:.e l'.. n ;,:~ 1 n cvE�I �lue ( C IF\) , G.F\. No. L..--- :3656, J a n. :3.1, 196~.:~; I s l c:\nd Garment Mfg. Cor p . vs. CIR, CTA No. 2 070 , ..JurH:~ ~.?2, 1 977 ; 1�1(:::'d in<" vs.. C IF\, c�r(:l !\l u . 1245, Dec:. 27, 1971; He rr era vs . C IR , CTA 110

DEC IE; I Cl!\l CTA CASE NO . 3 ~ A 3 :.1 . : :~ l\ln . ~.?060 ,, .J 1.:. 1""1 ('~ ':::'"7, l C_;>",r?_ ; r.:; ...\111 "'c~� :ln '"':; . c I r-;: ~� CT!'l NCl " ? ::~: :? ' J Lt n .-:�~ ~~ () ~� ."1 C) r�:d:J :j I �' ' l �i:�.f:"! !' I J Cl ' "'" ,. CIF~:, er n hie'. ..:.;�,..::. , De� ,�: / (: , J r?~SO .. ) In m�.'�' mo :,..<:'tn c!u m by that th e Commi ss ioner of Int er n a l R~ v e nu o re so l ved , Cor��po ,,..a t.: :i.on ,�:,~ rl cl 1... u ~:�:: F' 1'"1 ;:, r�� l: L' 1 r::� V F' ,... -!- ll C' rno v :i. c: ~ h u 1..t �:::;F! '::; nf c.~. 1��� :i. <:; .i. n (] f r ��um i.l. rn ;:,.n i�.\ �]E~ 'n crl t c: ur1 t r��� ;:\ c -1-: h c1 �l. �. t~o~ eF!I""l r::;: Y F\ ThE' <::\ t r���.i. c: ,�::~ 1 Fn �t.r} r��p r��:i. ~:; E~ s , l n c: .. ~� t..'.J .i h 1:.� I��IF' DE:��v c:~ J. o prn c''n t : l :� ~:' ;:�\ l""ld ��:r 1:: by the�:�' C h :i.F' f t:h P D i v i ~:; .i C11l <::\nd co n cUI'..r.. F~c:l i n b y t .h E' C i�l.i.~?"f of L.. r~ q <:\l S c:~ t..�v .i. c: P (Jff.i. c !=:! of th!�:' Bur-c�?i::'.t. .t o f Int� F~t..� n ,:,~. l F~ f.'~ VE nu c~, i.1�1 .,,, rn c~mr~J,...,.,.ndt..tm cl <:1tE'cl .J u n c0 l !:.':1 :� .1. 9!37 .::1.n c:l t hc:~. t:. t. he:> Curnm :L<:; �:::; i n r 1�.'�~ ,.-� u �f' I n tP r�� n '"' 1 F\F'V E~n u.t:' . .. c, ~:; c1l VE~ c::l t�. h ,�:~ t j.. h P r �e .l.. ~; no t .e.~<'" h 1 1,;~ 111

DEC I S I CJI\I CTA CA SE NO . 346J ����� J. CJ �-� j o i n t ventutrf:? in t h e c:o n tr-<::1 C: tu <:.~ l ,-F! l ,~t.i.e> rl~:;; l� l .i. p of t t. h e p a I'" :i. e Si to t . hi:'� ~ fll i'A I"l c:\<;;Ji:! fTl E11"l t . C: U ll t . l"' f:I.C '\'.: I'" P 'f E~ I'' I'"F! ci tu e:1bo ve , <-~nd th ;:,t: t h e:~ 'f' <:'.\c: t ~:;; p r� (�?s;r:'! nl:.e d .:i.. r1 t h E! t. a :~ C:i"lr::; c' referre d t o the rein a nd .in th e a b o ve- e nt i tl e d case n o w J::.1E' I'1 ci i. fl I.J t hi s H o n o t-�c:lh 1 E! E.'SE? n i::i. a l l y t h E'! Si<'~ fll �O!. Th e sa id rn F.:! fTl O t'- .:-:\ n d u rn for- t .hr::' Cu mrn.i ~:.;s .i. o n e-? r- of Inte rn a l Re v enue dated Jun e 1 5 , ME:t�HJRAI\IDUI"I F OF\ ~ Tht:! Com m i. s~:; io n e t�� ~?.~H?.J.. ~.G.I.:. . Th i~; I'" E! 'f E't��~:; t u t .h E! pt�� ut r?~; t�: o 'f r:;:yr;: TH EA TF~ I t 'Ll l.... 1::: 1\ITEF\F' r:\ I SE~3 !' INC, ~ f j_ J. E!d t. h t"'O LI CJ h ~: UL.tn s e J. ~ c':1 Q<o:1 i 1"1 ~:; t t l'lf-? d :;:; <::;E~ ~:; �,;, me n t S o f F'4 ~ ~5 ::~0 ~ 0 4 7. :2 0 C:l. s d c-? 'f .i c: i en c y i. n t: o rn E�' and f i. :�:e d ta :.: es fo r.. t.a :-:<:.11::> 1 e yea t'"S 1. 9 80 i':\ 1'1 cf :1. C_? l] l . i. rl j 0 .i.. rl t : V E! n tu I""C'!;:; 11\1:i. '1:: h L.. u z F' . 1��1 ,::~ t" t l-:> 1 Dncl I��IF' D c'Vf:? 1 n pmr~n t Cor p or a t ion und er A ssess me n t No t ic e No s . F AN - .1 -�- t3 0 ��..�E3 7 ���- 0 <):2 0 9 7 ~ FA I'\j �-�� :!. ��- 8 .1. --f:37����� 00 2 0 r78, FAN- 1 - 8 0 -87-002093 , FAN- 1 - 8 1-8 7 - 002094, F AN - 4 -80 -87 - 0 02099 , FAN- 4 - 81 - 8 7-0 020 0 0, F AN- 4 - 80-87-002095 , and FAN- 4 - 81 - 87- 0 02096 , a l l d ate d Ma r c h 2 0 , 1 98 7 . F\YF~~ "l"h e a t:.r-� ic:a l E~: n ter�� pr i sE~ s, In c " i ~; a dom es t i c: corpora t io n e n ga g ed in th e o per-a t ion n o t: on 1 y o 'f .i. ts Ohtl 'l rn o v i e huu Sf.:~ "~, bu t <~ 1 sc:> i n t .h e rn a n c:\ g \"? fll E~ I"l t . a nd o p e r-,3t.i.on o �f thE'!! <O'Itl'? t'� s b y t h .i. r�� d p a r�ti.er:;;. 11 2

DEC I S IO N CTA CASE NO. 3463 -- :?0 �-�� I n .1 9 "1 cr ~ .i. t E! n t. c~ 1�-� E~ cl .i.n t�. u ~:; C! p i:l 1���� a.t E' c on t. 1~� c:IC t s ~� F! r�, t .i. t l fXI 11 t� i<::~ n .::I CJ c~ lm�:' r1+:. Con t:r�� ,:\c:: t . 11 ''! .i. t.h HF' D E:v e 1 o pm e n t . Co r-pur��;:\ t..i. n n .::~ n c! l.... u ;:: F' � 1'"1<:\ I'"" b.:::> ]. ~ W h t? t-"E'? by .i t. \-.J C:I ~:; 3 p p oi n t .E:.' cl c-HH:I t:? rn p 1 oyf:? d a~:; t c=.-~ c: hn i c: ,:�,, 1 c:: on ~:; u l t a n t a n c1 qenc:>r��;::~ l tn i::l n <.:~<;;.! el'- to '' �; up t:~ r�� v.i. ~; E~ , cl i. I'""E-~c::t <"'- l"l cl c: on t n :J l t h r�� m <:~ n a ~J e rn E0 n 1::. .:.:~ n d o p r:> r-<:1 t .i o n 11 u �f t h !~ rnov i r?hu u ~;e~; o f t:. h e~ 1 ,;;~ t:. t:c' r- k n o\�~r 1 <:":\ ,�;: H a 1�- t��� :.i.. ~;;; o n F' 1 <~ �;: ,;:~ C i n em <:l :1. , :? i::\. n c:l ~::; , "' l J l oc: "" t!�?d at t. h E~ s p r�� i::\ ~'1! l in !J l���l <:1. 1-� 1��� :i ~:; o n F' l ,,,, z .::1 Comp l e x, Ha rr ison Bo ul ev0r cl , Ma nil a, w h i c h w as c:: o ~p l ete ly gutted by f i r e s u m ~ yt;~D I� �� ~; <:\go .. In t 1�1<:�? i r�1vr.0f:'.� t i ~J e~ t ion o f t. i::l )< P �'"- y r?,... ' <:;; t.a :�: l .i a l::.1.i. l :i. t .i.e s "f o ,~ t: tl f~ yc~<.:1 r� ~:: .t 9H O c.m d .1 98.1. , t. h E.~ E~ )<a m :i. n E~ r � .in t .�0 1'. p r-�p t E�? cl t he ,:'lc: t iv .i t .iE:~ s; e mb o d.i!�'~ cl :.i..n ti lE�? t.r-~ 1 -- m ~:;; a ncl pr-ov.i. �::; .ion s o f th r:.:-~ cn nt r-dc: i �.�::;; � �~ll.i. c:ll l�~c~ t..�c~ e,:; u b ~.;; t .:,\ n t :.i. i:i 1 1 y .i.. d C' ll t :.i. c: ,., 1 , 11 o t. .::;~ ~::;. c u n i:".r�- i :IC:: �t�.<;:, �f o r�� S F~r�� v .i c:e~:; hut .:�:\::> ..i u.i r1 t� V E~ n tu. r��c! ag l'"�e e mf-: n t ~:; , 21 ~:; .::1. r��t:? s.u 1 t. u f "~ h .i. c h :i. t ""-'�;"- <.:, assess e d "for d efici e n cy i n c ome a n d fi xe d t a : -:F� <:.:;. In f i n d ing an d j u st i fyi n g the e ;-: i. ~:.; t E�~ n c !7.~ o �f j o :i. n t . VL'n l:.: u l'"�c�'::; t-J :.i.. t .h I�IF' Deve l o pm en t Co rpo r a tion a ncl L u z P. lvli::l r�� tE~ 1 , t hP c~ ;.; ,::~ m in E�? r.. r�� c~ 1 i. <~ cl on t h e> �f cJ l l CH"'i n g <:15; p�?c: t~.; o�f t h t;? Hk\l"�l ,'-'~ ~J e m e n t c o n t .r��r.�,,c:t s , v.i. ~:;. .1 . T h <":~. t . l". hc pt""" DCUr-!:�) fll P rl t. u f th e rno v i (~~ f .i. I fT\ ~:; t() b e�? ~:; h D~\11"1 :i.n t iK! t h Ec-"'1 t e r-~::; 1-.J <:".\ : m.:=1 d E:! b y th e taxpaye r , w h.i. c h rm:> a.n <;:; t h at t h E~ 1 ,:\ t t.!::! t... a s o p E~r-a t o r.. con tribu ted c a pi ta l; T h <:).t tl "l E c:: ornp E' n :;;,:\ t .:i. u n f o 1'"� the ::;E:!r��v i CE' ~'.:; CJ "f t. h E~ ta :-: p .::1 yc0 1�- L"J<:\ Si ~5() ~~ CJ f t:. h E' opE�r�� ,:\ t i n g .i. n co rn c� , 1-.Jh.i.c:h :i.e,:; u n u s u a l i n the ma n a g e me n t c o n tra c ts w h e r e c om p e n s ation n CJr ma l l y i s fix e d a n d not d e p e nd e nt upon n e t p rofit or l o ss in b u s iness ope r a tj.on s ; and 113

DECISIUI\I CTA CASE 1\10 . 3463 :~; � T h <J. t. '1:'. hE I::.a:: p<::l y e? r � i:~.q ~ -�c-:~t:~c:l �t�.c�, <=" 1 1 oc: "" t c: i::\ n c:l fTlD. :i.11l '"'in ::; u �f �f .i. c. :i.E�'f'l t r: :-:~ p :i. 1::.,~ 1 ~" t . a ll times to ass ure the uninterrupted operAtion of the bu~:; i.n r?<:=;s.;. Th e t,:;, :-: P<'~ '/C:.~ r- , .i. n .i. t <:; p 1�" D 'l:.t:' ''i t�. , I"<::\ i. ~;r:::~cl t he foll owing issues: J.. � The:~ t"'E' ~"JE:~ I'" f." 11 o j oi nt: VE) I"l tu t"' ('?~=; ~"'it h I..�IF' DE~ ve l o p m e? nt: Cur- put'"i::\t:.i..on i:!. nc:l l....uz. F' . t-l ,:=~ t'" t (:-? 1, bu.t only c:unt.r �,:,c:::i:.<:s f o1 ... s;e l..-v .i.c(::?~3 ~ :2 � T a :-: p a.y E:.' r. ' s t a:-: 1. .i. <J. b :i. 1 .i t .i. E?"'; f u ,.. t: 1�1f:' YE?.a r� 1 98.1. h <:4.V f:0 b eE'n cunc:lur1r-::cl due l.:.o :.i.. t :<::; ,,,,_va i lm E�? 1�1t u f t�.,,~:< ;:\ flli 1 C�?~:> L:\ c<:; u t..l<:!r::: r - r::::�(F'C 1. .1 t �..i. V "~ (J I' �cl <:~I'' l\l n~::; ,. /I. J ;1 ,.) :. , 6 1l i~.11 r::l Ct5 ; i:':\ l lcl ::::.. Th r:? pE'I'" iod ~�,1ithi.r1 ~'llh :i.c: h to m;, kp i:':\1'1 asses s mPnt for the year l9f:30 h i:\Si y i:;l. l n~'i:':lcl o t'"e <::;c: ,,.. i b E�d � ThC'I'"C'; "'.1'1 r:l l ' i�.\.c; :\. ~:;; f 0 I'" .i..on 'i:.:E~:-:p,:ly(:?.r.. ' ~,, c o 1 �1t.~~::nt. L. h ,��.1. t �. �1.:.1�1c� n1�'' 1..1,,, (;! E: rn c> n t . con t.t�- ac: t s in qu (,:,;~; t i Dn a r�r~ c: nn i.�.r.. i�:\C t ~::; f o I'" se r �v .ic:e s a nd 1�1ot joint business VE' nture s. The f e a t ures or activities c:.itecl above by the examiner as t e ndi ng to show the f:? :-: .i~::.;tence o �f j o i n t. VF~ntur-r,:~:=; ,:~ r.. c-:� nut. <; tr-n ng e:1 nd su'ff:i.c::ient to ovt'? t� t�. ht"' OIN the::: essence and subs tan ce of said c o ntracts, which are p r incipally for p er forman cE' o'f SE' r-v .ic E'S , that. .is, �f n r.. t.,:~ :-: p <::~ yr:?r � 11 tn c:1c t. as tee: hn i. c a. l c:on su l t<~. n t d ,:�,1 r1 1;1 P l '1E! 1�-�;;~ l .in s u p r:? r-v .is i n q !I d .i r-r::~c: t in q , c: nn t t " CJ 1 l .i. n C.J , opE!r-a tir .g <:~nd rn e:1 n a q inq th('~ o p E': t"<'"' t.iCJn a nd bu :; .inc::: ~=;~ . uf thE! .. t h c:~atr.-~r ~::.; " of HF' Development Corporation and Luz P. Me:u- tt'? 1 , 114

DECI S IDI\I CTA Cn SE NO. 34 h 3 Th e p r��u v .i.. <;:, .i on ::; o �f !:1�1 C' c: o 1�1t 1��� act �:�; '~'~ h (~~ I'"C7. i .n t i:?l :�: p �::\ y�r;:., r � \'~ <'!. <:; u.n cl ' r� u h J. �i. q i�:l t .i u n ~ :,:\ <:=; o n ('? o f t. h E! ~,, e 1��v i. c e s or� ;::~c: t ..i. v i. t .i. ess t o h E~ I'� e n cl e I'"E! cl !I 11 t o n E~ g o t .i. '"' t:E) i�:\n d rn a k e C': lr�r-a ngemr:-2 nt.: -t' o 1"� h .i 1�� i n g, l E!i:~ ~:; .i n (.:::J a nd s h o w i ng o f rn o .,/ .i. t:� filrn !::i , 11 c-:1n c:l 11 t .u a l loc .::\t:E~ a n d fll f.:l. i. n t .:~..i n <::; uff ic:.i. E!nt. 1/'IUr �k .il..l q C:i:\ p :.i.. t:.,':\ 1 a t ,::~ 11 t.:.i. rn es to as~:; u 1��� f�? t:. h r:! u n .i.. 1 1 t 0. rr� up t E~ d o p E! t-a t i. o n o �F t h E~ t h i:�~a t c�:~ r� <:::� ~ " '''" '.. E! on J. y p h a <:; t:> ~:; o 'f t h r~ l'-' h o 1 f.�} b u. !5 .in c~ �:=; �::�; ~-; ~ 1���v .i. c: eo;:; �'~. n d pro f i l e of t h e ta x payer t h a t: b o l s t e r a n cl est.: c:1hli ~-:; h .i.. t. !:i t--e pu t .::~. t.:i. un ,;~n cl 'c:; t ,�:,_rl d :i.n r.;J as a c ompete n t, r e l i a bl e and st abl e rna n ,:;H;:_Ie rn E~ n t f .i. nn s pE! C: :i..<-:11 :i. ;.: :i. n cJ .i.11 L h ('' '"' t .E' t... o p r.=~ ,.- ,::~ t :. ��:Jn .. L...i k f~ \'1 .i :;(,'? , t:. hE) 1�� r~ i !::; n ot.h .i n ~:J u n u !5 \J .::\ i. 1��� r )q a r�d .in g t .h E~ p .-3. y rn E!n t. -1-:.c J t,::, :-: pay r::.� r�� o f 50/. o'f th E! o p E~ r-c:l'l: :i.nq i n c cHn(::! of t .h P bu s i n es s as co mp P n sa tio n o r ma n a ge me n t C: Drl t .l'.. i':\ C: t S , t: h E! rn a n i':\ Cj L) fll E�~ n t f E~ E' 1. '"; �f .i :: C�~ d ,;:,n d n ot c:l c;:.~ p e �-, ci F2 nt. o n t.h c=! u u t:.c��!nlc' u�f t h r�~ C) p Ec t"' '"' t: :i.u n D f t .h (:�? b Ll <::; :i l..l (;') ~o;; <;:; !I t .I l f;:~ p 0::1. I�'" t. .i E?'c; ,.,, ,.... (:::! f 1,..e f.~ t .n '"' do p t a cl i. f 'f E':! r� E! r1t: :::; c:: h (�:? me o ,.... a r r ange me n t as r e gar d s ma n a ge me n t f e e f or serv i c e s ren d ered. i"lo I'.. E'U \1 E! r� ~ 0 n f:? ()!:..; !;:; C.' n t �. :i. o':\ J (".' 1 C)ii\C�:' l"l i.�. C.l i' c:l j o i 1..1t Vl::? nt. t.'. l��� ~:~ i. ~; t h t:~ i n tE? n t .iun of t h e� P<'=' r� t .i. E!~;; t .h e! ,.-��c- t .o ~ wh .i c h rn <" y b e .::1r1 E' ;; p t'" E~ '"'~':i o 1,.. .i. rn p l .i. C'.'c:i <'lg 1�- e~:~ mr:.� n t to c: 0 1..11�.1� �� :i. bu t:E:! o ,,.. c o mb .i. r1E~ t:.h e i. r� pt-u p (�? 1��� t '>' !' !':; 1=: :i.. 1 J. C:! 1'� t .:i. rnEc :i.n <::\ s p E�~c.i. f .i. c-~cJ CCJU I'"S E' o f b u !::i.i.rH �:�' <::i !'5 n r � c:u rn rn u n u n d t:::) r �� t a k :i n y ~ I�" .i. t-. h t�.h r.;) .i. n t�.c'1 �1t .i o 1�1 u f d .i. v :i. d .in g th e:! p t- o f i t. ;; h E�~ t~'oJ(.o'C!n t. h r:: rn ~5F! J. yp ".; . ( I< 1 ,;:~ b E! t... V !'.i . I< 1 a h r:: l�� F 1 <':\" (.) p p . J ::~:::s !3 CJ :?cl 9B !1 c: .i t r? d in �~'lm ,JL.w :2 c1 ~5'? .. ) In t h e i n stant c:ase , i n t:. P nt.i.o n o f t ax p a y e r a n d HP De v e l o p me nt Corpor a t i o n D r t ax p a y er a n d Lu z P .. Ma r tP l to e n gag P .in t h ea t er o p e ra ti on business? I t i s h e l .i. F! Yt ?d t h dt ~:; u. c h v.Ja �::; 1�1nt t h t ):i. r i n t E:)rl t i. on \'~ h e n t h f:-? Y e n t r::.� l'� �::c c.i i. n to l:h e fll <':ln a g e mE�nt. c:CJ n t: r. ac:t s . I t i!::; v~ .idc;) ].y k n ow n i n bu si n ess c: j rc l es~ mo re P<'!ll'� t .i. r::: u 1 a l' � l y .i.. 1�1 t he tht?a tr.~ r�� np t�?r- a t :i.n n I:Ju ~:;.i n t:~ ~=; ~; t h a.t: t a :-:pa y c:? r h E:\S h(?E.' n .i.. r�1 t:. h i !::; k i n c1 u �f b u s i n ess 'for rn a ny ye a r s , eve n l o n g b P f or o 115

DF.::C IS I 01\1 CT A CASE NO . 3463 ... .'"..":':1. ' :�':0' --� t.ht::' e:-:f:?C::I...t.t.i..on o �f the~ ~:,e~ id m<:tnC:I<JPrnr-.~r l-1~ c: o n t 1��� "''� c t. z, , It u ~�~ 1�1<:0 cl !' o p !*' r �a t r::! c1 i" n cl managed a number of f i r st-class mo v i e houses rig ht in the h eart of Man i l a. Thu s, it i s i n c:on c:eivab l e for it to st ill F~ l""l iJ<'='. gP .i . 11 j o i nt vc n tu I'.. F-, \'��' i. t l 1 I:: hi r�d p 2:1r�� t .i I'? S .i. n t hf:." ~5e:1rne 1 .i. n c:! u f bt.\~:::� .i. n f:0~:~~; in which it was primar l y e ng a g e d. It could have jus t put up a nothe r fir s t -c l ass Cil""lE'rTlic~ of .i -1::.~:; O~�~ ll ~:;CJ(llE'V�!hC�~ r�� c' !;:~]. ~"- F�~ CJ I'"" l'"".i.i] h -1:. :i. n t. hE�? p 1���c-~ m i. ,-:;c~~:; of t hr~ v <.v:::; !.". H .:u ��� 1���.i. ~;or1 F' 1 '"' z. <::1 Cumrn 1:~ I' c: :i.,:-:~ l Com p l 1�:�:: :-: �fur�� i t h i:~.<: l !5 u f f :i. c .i.e n t �f i. r1 <�:~ n c :.i.. <::1 1 r �c-~ E.; or..\r�� c: e <:;; !' 1.�. r;' c:: h n i c:: "'' 1 :::;c-~ r��v i. c: !:~!:=; D. r 1cJ mD. n "''J e r'" :i. '" l I�?':: p 0:~ r���� t"..i. cs; � But. i:":l s; t<::\:-:payE' r'"�'::: cuu n sc~' .l. c:: l a..i.rn�::;, :i. t. \�~i::\ �::; hi !::; c 1 i E' n t ' s t!'cC hn .\.c ,�J. 1 �::; p t���v .i. c C:':::; ,�:' 11 cl r:-:' :-: p1:-:~ r�� t i '31:-' a !'5 \.,, (~~ l 1 '" !''; bu. !::;:\. n e !=:; ~=; c:: 0 11n E?C t� .i.o r1<;: 1.: 11 ,3. t. m," t:l (} thr::! thE~ <?.t c-:~ t - Dl'l�n r:;> r-�:;; c:l cc :.i..c:I F' t: o �::; 1::c c u.n::c .i. t �:=: se r v ices as ma n age r - operator lhe re as on :t. s quit E' c:-I:J\/ �.i.. u u.<::; � HF' r:-c~ �.,t t�~ 1 o prn E1 r�1 t C:u r- po r�� ,,, t .:i.un <"-til d Lr...1 :;-: F' ,,.,,., �� i".r::: 1 ~-~('~ 1��-c-:c e~ pp a rent l y busi n e ss n eo ph ytes insofa r as t h E~i::\ te ,~ u pE-? t�- ,::~ t :i. nrl i ::; c: on c: E' r� n (~ cl � Th E~ 1'-E'C o t���d s ~:; he,�.�! that at. t hr:-:c t. .i rn r:? of the:' execution of HP Deve l opmen t Corporation' s flli::tn ;::~ g E? rn e n t con t:. r�� ;,:~c t v,r:i. t. h t a ~< P<':l yc' r�� o r�1 flugu~:; t ~?0~ .1 979, i t ::; rnDVil"'? thr::?a tt~r (Harri s on P l aza Ci n Ptna 3 ) was s til l und e r co n ~5 t 1��� uc t :i.o1 �1 � In l: h f:.~ 1 c-~ ,;�,,.d .i.nq c:.: ,_,�; r: r) f Eu fE:m i..i�:\ [::.v.:.~:\.n IJ''~ ]j., ~;:;_ t i:' , . .c �!:�. . . ~ L., . .y :=:; ., r: cl,l 1 <::� ( t u r� rJ f Iu.t(?rfl. 9 J ... fi(?Y~I)\}f?.:� c-:o . R , L.�����9r:;c?h pr Dmu J.q,:::' tE?cl (] c to be r- .1 ~5 ~ l 7 :':i 7 !' vJ h er� e t hI'"" e P ( :::; ) ~:; .i :c; t. c 1��� e:; contributed their pt>r s onal fund s , including t.h<? rnon!?',' t. l�l .:'i t t. h c0 y h ave' bo r � I'""IJ W(?CI "f r'"�o rn t h r~ i. r�� "f '"' t h r::o r�� , tc:> a c Dtnmon �fun d a n d bouq ht r���('?Cl. l p r� upct-� t i F' !'> for.. thEe pur�� po ";e of r-(?. n t. :i. n ';) t I 1urn u �...l t: �t�.CJ �:',E'V e 1� -;,;~ 1 tc"'! narl t~-5, t. h E? n a p po :i.n tr:"d l : he .i.. ,... br�o th e 1'- to ma n age th e propertie s with fu l l power to lei::tse, co l l ect. .?. nd n ?c:e.ivl'? rent.al~;, and to take a ll necessary acts for t h e s uccessful ma n age me nt a n d operation of the bus.i.nE, ss, to th f? <:'? nd that thE' properties h a d been handled as .if t h e 116

DEC I ~3 I Ul\1 CTA CA SE 1\10. 3463 -- :? <'1� same belong e d to a corpora tion or bus iness undertaking operated for prof it , the Sup t~ f? fll C0 Cour�t h E!l d ttl ,::\t fot�� t:o: : purpos es t he siste rs were deemed to have fo t'" med <.:~ P�'=' ''. tn et-<::;hi p , T h E� ;,:~ h o\ 'C~ ca<:c;f? \<Ji:'l ~:> followed by ~ till a noth e r l e0di.ng casP of G(: '-L 1.q!::: �1.7, l.::>.r:.. . ... c t' ...... J f.1 . t~-?. .1:' J 11.~3 . . F! E~ \ ' r:� llf.,t("' V <:; , �r Q<} . l;.r.~.IJIJ .9..!:.-~..... .t ._<'.'\ 1<.~::,p qcJ: C:\.t .i.Dil .... .Co ~. .. ~:'.11 cJ . 1,. i~.qL<[1 <':I:�: T?.Y.::~J::Ji::\2 .)3 <:_:\J:?..IJ9?.~ . Cq �. ~, :!.0:? F'hi 1 . !::12::~ (G. n " No. L- 9692 , Jan . 6, 1958 ), where two transportation compDnies operating se paratel y d ecided to pool their l"' f?S OU I'" C C-0~:; i:Jy Co mb in .'.i.. n q t h� '? .i.. I'" t i. !'" (:\<:5 p PC V!:-' f 1 c-? e t:~; o �f hu ~;c;~s� , p 1 c:l c: c:� r::l 1:. hr:�:' o pr��,. i::l L.i on o f t .hFJ b u <::;in E' ~::; s <�..\ n cIE' r� or 1t:'~ ~,�; u 1i:'�' md 11 ,,,, q F~ rn!:-?n t:. ca ll ~?. d tt�K �J ",'Joint Upr::�r�::~ t :i.on" �for. th r::~ purpof:;c-0 ot ('!Conn miz.i.n (J on E?:�~ pe n :;e ~'; , tu the en d th;;:-1t the:y con ~:; t.i tu.t EJ c:l .:�,, s ingl E�~ entity , and after accounting for the gross r ecei pts and a l l ex penses i n c urred, divided t h e rt:� s ultin(J n E~ t p t'� u �f.i t on a ~10 �- ~j(l <;; h <:\ r� in g b .'A::; i ~:;, t. h e� Cou I'" t. '"' r;J .,;�,, :i. n t'" U l c~ r:l t:l"l <::lt th e c.:.;<d.d ,:~ r�-r-.:H�1g E�rnr�;~nt o r� ~=;c h r::'rn c~ c: on<:; t :i. tu t r::.� c:l ~~ j u in t v r::� n tt .tl""t~ un d c0 r. th e! Natio nal Int e rn a l R ev~n u e Code. It shou ld he n oted that in t hese two cases, the f acts were c l e ar a nd un e quiv :: .=�AJ. , !::1. oth a~:; t.o th Ee .i.r1i .c0 n tio n of the p <:1r� t..it~'::; ,:\ncl t h P fll r.":\ 1'1f'l E!r� I:Jy ,.,.<hi c: h � t .h c) busi n ess enterprises were c reated a nd ma naged, an d t h e p artici pation of th e pa r ties in the net pro fit s ur losses. On t he b asis o f the above eva l u a tion a nd discuss ion we f i nd it unnece s sary anymore to di sc us s th e me rit s o f th e two remaining issues rai sed by the taxpayer. In V .i E~V.I 0 �f t. i�1C�? f 0 r�t:? g f") i rH] , <':lf'l d �f .i.nd ing tax p ayer's protest to be well t <:'\ k e:� n , it is re spect full y rec ommended 117

DECIUION CTA CASE NO . 3~63 t h <"' t t .h ,:.:~ qU E!~; t i Oil C:.' ci i:JC'�' ~o.Ji.thdr- awn E:\nd cc:1nc: ~:! ll ed. Res pectfully s ubmitted: (Sgd.) EULOGIO H. NATIVIDAD Chief, Appell ate Di v i sj.on I CONCl.m: Re ve nue Service, Chief L. e gal Offic e Re c ommend a tion -AP PROVED: (Sgd.) BIENVENIDO A. l AN , JR. Commissioner of Intern a l Revenue In view o �f thE:? fol~eqo i ng !' i t i. ~5 our- o p i 1..1ion that thf:.? cl<J.im o�f v-Ps pc:.lnd E:? nt th .-:\ t: ""' ta;.: ahl F~ j oir1t. not have a n y merit an d without any l e gal bas i s. the d f., c:: :i. ~:; .i o n of t:hc0 CDmmissione �� of In t e r�na l n( cV F? rlU t"' <'.\CJD. .in ~ot: petitioner-s for� :1_ <1 '76 defic:.i.E~n cy in c omE:? t c:~~-: in t.hE:? sum of P1,580,'705 .66 is here by set asj. de. No pronouncement as t o costs. SO CJRDF.::RED . Qu ezon Cit y, Metro Ma nil a, 118

DECI ~3 I Cll\l CTA CASE 1\10 . 3 4 6 3 .... :.26 0:::::~ F'r'-es.i d.in g clud qe CERT I F I CAT I 0 N I c::e r~� t.i 'fy th .::~t: t h.i ~:; ci e c:: .i. siun r�ea c h eel a 'f t. E~ t"' cl t.t 1;~ 1:: nr1 ~,, u 1. t,::~ t .i. u n i::\ mun !.J t h (:? rn e mb e ,,. ~,, o 'f' th e Court n'f Tax Ap p ea l s .i n accor d an c ~ wi t h S e c ti un .t 3 , Ar.. t .i c: 1 e V I I I o f t h E) Co n >:; t..:i. 'l:t .t t�: i u r1 �� AMANT FILL ER F' r- r:! ~o:, .i.cl i n r;J .J u c:I !J F~ Court o 'f Ta x Ap p ea l s 119