CTA Case No. 1438 (Decision)

:E PBJU PJ'IlfE PPE L8 4tUJ~�N ern SURIGAO ELECTRIC CO., I NC., Petitioner, - versus - C.T.A. CASE NO . 1438 THE CO ~;j}1ISSIONER OF INTERNAL REVENUE , Respondent. X~ - - - - - - - - - ~ ~ ~ X DECISIO N This i,s. an appeal from a decision of the respon- dent, dated April 29, 1963, holding the petitioner liable for the smfi of �11 ,533.53, representing 5% franchise tax, .including the 25% surcharge, for th�3 period from April 1, 1956 , to June 30, 195'9'� Petitione~ , is a grantee of a legislative fran- chise under Act No. 3419 (Exhibits �tNt" and u19tt, p. 47, CTA Recbrds) to install, operate, and maintain an electric light, heat, and power system in the Muni- cipality of Surigao, Province of Su~igao (Now Surigao del Norte) . Section 7 of this franchise provides that the grantee ttshall pay quarterly into the municipaL treasury above-named, one per centum of the gross earnings of its electric business during the first thtrty years, and two per centum during the remain- ing twenty years of the life of this franchisen. (Ex- hibit tt19...An , p. 48, CTA Records) Section 11 there- of provides that said franchise tt-is granted with the 1 understanding that upon the condition that it shall be subject to amendment, alteration, or repeal by the Congress of the United States as provided in Section twenty-eight of the Act of Congress approved August twenty-ninth, nineteen hundr ed and sixteen

DEC IS ION: ... CTA Case Nco 1348 x x x x or by the Philippine Legislature, and that it shall be subject, in all respects to the limita- tions upon corporations, x x x x't (Exhibit r 19-B'�, P� 50, CTA Records)o On November 29, 1961, petitioner received a copy of a warrant of distraint and levy, dated October 6, 1961, to enforce collection of an alleged deficiency franchise tax and surcharge of "Mainit Electric11 in the sum of ~71 8 o OOo (Annex ttAn, Petition, p. 7, CTA Records; Exhibit t~4u, p. 49, BIR Records) This 'l..va.rrant of distraint and levy was contested in a strongly worded letter of petitioner, dated December 4, 1961 (Exhibit u4n, p. 49, BIR Records), wherein it .was contended, among others, that petitioner was not a grantee of an electric franchise in Mainit, Surigao. This controversy culminated in a revised assessment, dated April 29, 1963 (Exhi bitsttKtt and n15n, pp. 81 and 82, BIR Records), in the s~~ of ~11,533.53, representing deficiency fran- chise tax and surcharge for the period from April 1, 1956 to June 30, 1959, computed as follows: Gross receipts as per recom- 11,533,53 putation --------------- 3% tax due thereon ----------- Less Amount paid ------------- Balance ------~~~----------~-- Add: 25%. surcharge ---------- Total a mount due ------------- ~ (Exhibits u14n, n15u, u16u and ttKt', pp. 8o-84, BIR Records) The above revised assessment, which reduced the previous assessment of �26,445. 08 to Pll,533.53 (Ex- (

DECISION:- CTA Case Noo 1348 - 3- hi bits "Kl , n14u and 1'15tt, pp. 80-82, BIR Records), was received by petitioner on May 8 , 1963 (See bottom Exhibits ttKtt and n15n, p. 81, BIR Records)o In a letter, dated June 6, 1963, sent by registered mail on June ?.; 1963, and received by respondent on June 13, 1963 (Exhibits "L" and n17u, also Registry Envelope No. 54150, pp. 85 and 86, BIR Records), petitioner requested further recomputation of the said revised assessment, contending that the total amount actually due was only ~1,774.57 instead of �11,5~3.53. This request was denied by respondent in a letter, dated June 28, 1963 (Exhibits 1':H11 and n18n, p. 87, BIR Records) and received by petitioner on July 16, 1963 (Par. 17, Petition.'). On August lst, 1963, the pre- sent petition for review was filed. The issues raised are: (l) whether or not the present appeal was filed within the 30-day period provided for in Section ll of Republic Act No. 1125; and (2) whether petitioner is liable for the 5% fran- chise tax prescribed in Section 259 of the Tax Code, as amended, or for the lower rate of franchise tax provided in its charter. The issue of ' jurisdiction was raised as a spe- cial defense in respondent 1s answer, but the parties fa1led to discuss it in their respective memorandums. On this issue, it appears in evidence that the revised assessment, dated April 29, 1963, reducing the tax liability from ~26,445.08 to �11,533.53, was received

DECISION:- CTA Case No . 1348 - 4- by petitioner on May 8, 1963. Following the accepted and established procedure of computing time known as ttexditude the first and inchJ.de the last11 method, it is clear that from V.iS.y 8, 1963, the date when petitioner received the revised assessment, to June 7, 1963, when petitioner's letter of June 6, 1963 requesting recom- ' putation was sent by registered mail to respondent, 30 days had elapsed. Considering the said request for recomputation to be, in effect, a motion for reconsid- eration, it suspended the running of the 30-day period to appeal from the date of its mailing on June 7, 1963~ The prescriptive period corr~enced to run again on July 16, 1963, when petitioner received respondent's letter of June 28, 1963 denying said request. From July 16, 1963 to August 1st, 1963, when the present petition for review was filed, additional sixteen days had elapsed. The appeal is therefore late by sixteen(l6) days. The failure of a taxpayer to appeal from an assess- ment on time renders the assessment final, executory and demandable. (Commissioner of Int. Revo vs. Western Pacific , Seep. 5, Rep . of the Phil., v. Del Rosario , G. R. No o L-10460, March 11, 1959; Uy Ham v. Rep. of the Phil., G. R. No . L-13809, October 20, 1959; Comm. of Int. Rev. v. \-Jestern Pacific Corporation, G.R. No . L-18804, May 27, 1965.) And the period to appeal being jurisdictional and non-extendible, the failure to seasonably file the petition for review is fatalo

DEC IS I ON: -CTA Case No . 1348 - 5- (Pangasinan Transportation Co., Inco v. Blaquera, G. R. No. L-13101, April 29, 1960; Chan Kian v. Court of Tax Appeals , G. R. Noo L-12184, ~~y 29, 1959). Ac- cordingly, this Court has no jurisdiction over this caseo The foregoing conclusion renders academic and unnecessary further discussion on the issue relative to the legality and correctness of the assessment in questiono PRE:t-fiSES CONSIDERED , the petition for review is hereby dismissed, with costs against petitionero SO ORDERED. Quezon City, October - 1, 1965. SR. ! CONCUR: Associate Judge. ALJ:JA?11RO B. AFURO'-rG did not take part o