METRO ILOILO WATER DISTRICT v. THE HONORABLE COMMISSIONER, BUREAU OF INTERNAL REVENUE, herein represented by The Regional Director BIR

Republic of the Philippines COURT OF TAX APPEALS Quezon City METRO ILOILO WATER DISTRI CT, C.T.A. CASE NO. 6093 Pcti ti oncr, Pr�omulgated: - versus - THE HONORABLE COMMISSIONER, BUREAU OF INTERNAL REVENUE, Herein represented by The Regiona l Direc tor Bureau of Internal Reve nue, Region Vl, Il o il o City Respond ent. X--- - - - - - - - - - - -- - - - - - - - -- - - - - - - - - --- - - - -- - - - - -- - ---- - - - ---X DECI SION Res ponde nt in hi s Memorandum ra ised the iss ue that thi s Co urt has no jurisdicti on to e ntert a in petiti oner's appeal citing as ground sec ti on 66, Chapter 14, Boo k IV of the Admini strati ve Code of 198 7 (Executive Order No. 292), it is expressly provided that: "Chapter 14 - CONTROVERS IES AMONG T HE GO V ERNMENT OFF ICES AN D CORPORATIONS Sec. 66. How settl ed . - A ll di sputes, c laims and co ntroversies, so le ly betwee n or among the depa rtments, burea us, offi ces, age ncies and instrumenta liti es of the N ation al Government, inc luding government-owned or controlled corporations, such as those ari sing from the interpretation and application of statutes, contrac ts or Ag ree ments, shall be admini strati ve ly settl ed or adj udi cated in the man ner prov id ed on this C hap ter. 87 0

I DECISION CTA CASE NO. 6093 - -2- This Chapter shall, however, not apply to di sputes involving the Congress, the Supreme Court, the Constitutional/Commi ss ions and local governments. Section 67 . - Di sputes Involving Questions of Facts and Law. - Cases invol ving mixed questions of law and of fact or only factual issues shall be submitted to and settled or adjudicated by: (I) The Solicitor General, if the di spute, claim or controversy involved only departments, bureaus, offices and other agencies of the National Government as well as government-owned or controlled corporations or entities of whom he is the principal law ollicer or general counsel,; and (2) The_ Secretary of Justice in all cases not falling under paragraph ( 1). The above Section is an amendment of the original provtston 111 Section 1 of Presidential Decree No. 242, quoted hereunder in the cited case of DBP vs. Court of Appeals. As admitted in its Petition for Review, petitioner, Metro Iloilo Water District is a government-controlled corporation organized under PO I9S, as amended; while respondent, Commissioner of Internal Revenue is the head of the Bureau of Internal Revenue (BIR) a national government age ncy charged with the assessment and collection of national taxes. Applying the aforequotecl provi sions of law di sputes or controversies between or amo ng government entities including government-owned or controlled corporations, shall be administratively settled or adjudicated, as the case may be, by the officials mentioned therein and not by the Court ofTax Appeals. Thus as clearly expressed by this Court in the case of PIIilippine Export and Foreign Loan Guarantee Corporation vs. Tile 1-lon.LhvayJvay Vinzons-Ciwto, 87i

DECISION CTA CASE NO. 6093 - -3- Commissioner of lntem.al Revenue, CIA Case No. 5196, JY/ay 17, 1996, citing the Supreme Court's ruling in Development Bank of t!te Philippines vs. T!te Court of Appeals and t!te Commissiouer of Customs (180 SCRA 612): "Our firm reso lve is based on the lack of jurisdiction of thi s Court to entertain the petition. Petitioner has no legal standing to sue before the Court of Tax Appeals. It must be noted that Petitioner is a government-owned and controlled corporation created under its enabling statute, Presidential Decree No. 550, as amended. (Petition for Review, par. 1, p. I, CTA record s). In_ the case of the Development Bank of the Philippines VS . Court or Appeals (I 80 SCRA 612-614, 617), th e Hi gh Tribunal held, thusly : "xxx The Court of Appeals sustained the position of the customs Commissioner that it was grave error for the Court of Tax Appeals to have taken cognizance of the case is view of the explicit provisions of Presidential Decree no. 242, pertinently providing that: SECTION I. Provisions of law to the contrary notwithstanding all di sputes, claims and controversies solely between or among the departments, bureaus, oflices, agencies and instrumentalities of the National Government, including government-owned or controlled corporations but excluding constitutional offices or agencies, arising from the interpretation and app lication of statutes, contracts or agreements, shall henceforth be administratively settled or adjudicated as provided hereinafter: Provided, That thi s shall not apply to cases already pending in court at the time of the effectivity of this decree .." 87 ~

DECISION CTA CASE NO. 6093 - -4- SEC. 2. 1n all cases involving only questions of law, the same shall be s ubmitted to and settled or adjudicated by the Secretary of Justice, as Attorney General and exofficio legal adviser of a ll government- owned or controlled corporation s and entities, in consonance w ith secti on 83 of the Revised Administrative Code. His ruling or determination of the question in each case shall be conclusive and binding upon all the parties concerned . Sec. 3. Cases or in vo lving mixed questions law an d of fact or on ly factual 1ss ues sha ll be submitted to and settl ed or adjudicated by: (a) The Solicitor General , with respect to di sputes or claim s o r controversies between or among th e departments, bureaus, offices and other agenc1es of the National government; (b) The Government Corporate Counsel, with respect to disputes or claims or controversies between or a mong the governme nt- owned or controlkcl corporations or entities being served by the Office of the Government Corporate Counsel; and 8 ., ,-, ' 1.)

DECISION CTA CASE NO. 60 93 - -5- (c) The Secretary of Justice, with respect to a ll other di sputes or claims or co ntro versies, which do not fall under the catego ri es, menti oned in paragraphs (a) and (b). The A ppe ll a te Court ru led th at Secti on 7(2) of Republic Ac t No . 11 25 - pursuant to whi ch the Co urt of Tax Appea ls had therefore been exercising exclusive appellate jurisdi cti on over decisions of the Commi ssioner of Customs in cases involving li ~bility for customs in cases invo lvin g li ability for c ustoms duti es, fees or other money charges, inter-alia - had been superseded by said P.O. N o. 242, it being "a se ttl ed rul e of statutory constructi on tha t where there is irreconcil abl e rep ugnance betwee n two statutes anent the same subj ect matte r - as there is between P.D. 242 and Sec. 7 (2) of R. A. No. 11 25 in regard to the manner of settlement of disputes involving customs duti es, e tc . betwee n government offi ces, age ncies and corporati ons - the one of late enac tment, being the latest ex press ion o f th e legislati ve w ill , should preva il over the oth er whi ch is of earli er enac tm ent. " S imilarl y, 111 National De velopment Company vs. Commissioner of Jutemal Revenue, CTA Case uo. 5309, September 4, 1996, this Court, in sustaining the dismi ssa l of the case for lack of jurisdict io n, ex plained th e p urpose fo r prescribing the procedure for admini strati ve settl ement or adjud ication of di sputes betwee n or among government e ntiti es and age ncies, as fo ll ows:

DECISION CTA CASE NO. 6093 - - 6- Apparentl y the purpose for prescribing th e procedure for ad mini strative settl ement or adjudication of di sp utes, claims and controversies between or among government offices, agencies, instrumentalities, including government owned or controlled corporation was to "avoid liti gation in Court where government lawyers appear for government offices, agencies and intrumcntaliti es to espouse and protect their respective interests a lthough, in the ultimate analysis, there is but one real party in interest - the GOVERNMENT ITSELf<' - in s uch " liti gati on" and to avoid, too, "need less ly co ntributing to the clogged dockets of the Co urts and di ssipating or wasting the time and ene rgies not only of the Courts but also of the governm ent lawyers ~nd the considerable expenses incurred 111 the filing and prosec ution of judicial ac tions". Co nsiderin g the apparent lack of jurisdiction of thi's Court, it docs not find proper anymo re to dwell on the oth er iss ues raised by the Respondent. WHEREFORE, in th e light of th e foregoing di scuss ion, this petition for review is hereby DISMI SSED for lack ofjurisdiction. SO ORDERED . ~-a . c~ ERNESTO D. ACOSTA Presiding Judge 1 CONCUR: 870

DECISION CTA CASE NO. 6093 - -7- CERTIFICATION 1 hereby certify that the above decision was reached after due consultation with the members of the Court of Tax Appeals in acco rdance with Section 13 , /\rticlc VIII of the Const ituti on. ~~-c~ ERNESTO D. ACOSTA Presiding Judge 8'7 G