Ormoc sugar vs treasurer of ormoc city 22 SCRA 603

Facts:
The Municipal Board of Ormoc City passed Ordinance 4 in 1964, imposing on any
and all productions of centrifugal sugar milled at the Ormoc Sugar Co. Inc. in Ormoc
City a municpal tax equivalent to 1% per export sale to the United States and other
foreign countries. Referred to as a production tax. Production of sugar alone is not
taxable, the only time the tax applies is when the sugar produced is exported. The
company paid the said tax under protest stating that the same is violative of Sec
2287 of the Revised Administrative Code which provides: It shall not be in the
power of the municipal council to impose a tax in any form whatever, upon goods
and merchandise carried into the municipality, or out of the same, and any attempt
to impose an import or export tax upon such goods in the guise of an unreasonable
charge for wharfage, use of bridges or otherwise, shall be void. Said ordinance is
alleged violative of the equal protection clause and the rule of uniformity of taxation
as it singled out Ormoc Sugar As being liable for such tax impost for no other sugar
mill is found in the city.
Issue:
Whether the ordinance violates the equal protection clause?
Held:
Yes, the Supreme court ruled in favor of Ormoc Sugar Company. The ordinance is
prejudicial for it taxes only centrifugal sugar produced and exported by the Ormoc
Sugar Company, Inc. and no other. Said ordinance, to be reasonable, should be in
terms applicable to future conditions and shouldnt be singular and exclusive as to
exclude any subsequently established sugar central, of the same class as the
plaintiff, for coverage of the tax.
Tiu vs CA 301 SCRA 178
Facts:
President Fidel V. Ramos issued Executive Order No. 97, on June 10, 1993, clarifying
the application of the tax and duty incentives. The petitioners assail the
constitutionality of the said Order claiming that they are excluded from the benefits
provided by RA 7227 (an act for the conversion of former military bases into
industrial and commercial uses), according to which the grant and enjoyment of the
tax and duty incentives authorized by such ordinance. This was due to the limitation
of tax incentives to Subic and not to the entire area of Olongapo. The court a quo
also explained that the intention of Congress was to confine the coverage of the
SSEZ to the secured area and not to include the entire Olongapo City and other
areas mentioned in Section 12 of the law. The Court of Appeals upheld the validity
and constitutionality and denied the motion for reconsideration. Disagreeing,
petitioners now seek before us a review of the aforecited Court of Appeals Decision
and Resolution.
Issue:
Whether or not Executive order No. 97 is constitutional?

Held:
Yes, E.O. 97 is indeed constitutional. Citing Section 12 of RA 7227, petitioners
contend that the SSEZ (Subic Special Economic Zone) encompasses (1) the City of
Olongapo, (2) the Municipality of Subic in Zambales, and (3) the area formerly
occupied by the Subic Naval Base. However, they claimed that the E.O. narrowed
the application to the naval base only. Hence, petition dismissed.
Herrera vs Q.C 3 SCRA 186
Facts:
The petitioners were authorized by the Director of the Bureau of Hospitals to
establish and operate the St. Catherine's Hospital. In 1953, the petitioners sent a
letter to the Quezon City Assessor requesting exemption from payment of real
estate tax on the lot, building and other improvements comprising the hospital
stating that the same was established for charitable and humanitarian purposes and
not for commercial gain which was granted effective the years 1953 to 1955.
Consequently, in any case, in a letter dated August 10, 1955 the Quezon City
Assessor informed the petitioners that the previously stated properties were
renamed from exempt to "taxable" and in this manner surveyed for real property
taxes effective 1956. The petitioner advanced the assessment to the Quezon City
Board of Assessment Appeals, which, confirmed the decision of the City Assessor. A
motion for reexamination thereof was denied. From this decision, the petitioners
instituted the instant appeal.
Issue:
Whether or not the petitioners should be excused to pay real property tax for the
reason of that the hospital is a charitable institution?
Held:
Yes. Rendering charity is its primary objective. The income realized from paypatients is spent for improvement of the charity wards, and that petitioners, Dr.
Ester Ochangco Herrera, as directress of said hospital, does not receive any salary,
although its resident physician gets a monthly salary of P170.00. It is well settled, in
this connection, that the admission of pay-patients does not detract from the
charitable character of a hospital, if all its funds are devoted exclusively to the
maintenance of the institution as a public charity.
Province of Abra vs Hernando 107 SCRA 104
Facts:
The provincial assessor made a tax assessment on the properties of the Roman
Catholic Bishop of Bangued. Judge Harold Hernando dismissed the petition of Abra
without hearing its side. When asked to comment, respondent Judge began with the
allegation that there is no question that the real properties sought to be taxed by
the Province of Abra are properties of the respondent Roman Catholic Bishop of
Bangued, Inc. The very next sentence assumed the very point it asked when he
categorically stated: Likewise, there is no dispute that the properties including their
procedure are actually, directly and exclusively used by the Roman Catholic Bishop
of Bangued, Inc. for religious or charitable purposes.

Issue:
Whether the properties of the Bishop of Bangued are tax-exempt.
Held:
No, they are not tax exempt. The 1935 and the 1973 Constitutions differ in
language as to the exemption of religious property from taxes as tehy should not
only be exclusively but also actually and directly used for religious purposes.
Exemption from taxation is not favored and is never presumed, so that if granted, it
must be strictly construed against the taxpayer. There must be proof of the actual
and direct use of the lands, buildings, and improvements for religious (or charitable)
purposes to be exempted from taxation.
Abra valley vs Aquino 162 SCRA 106
Facts:
Petitioner Abra Valley College is an educational corporation and institution of higher
learning duly incorporated with the SEC in 1948. On 6 July 1972, the Municipal and
Provincial treasurers and issued a Notice of Seizure upon the petitioner for the
college lot and building for the satisfaction of said taxes thereon. The petitioner
then filed a complaint to annul and declare void the Notice of Seizure and the
Notice of Sale of its lot and building located at Bangued, Abra. The trial court
ruled for the government, holding that the second floor of the building is being used
by the director for residential purposes and that the ground floor used and rented
by Northern Marketing Corporation, a commercial establishment, and thus the
property is not being used exclusively for educational purposes.
Issue:
Whether or not there should be tax exemption?
Held:
Yes. Interpretation of the phrase used exclusively for educational purposes
Section 22, paragraph 3, Article VI, of the then 1935 Philippine Constitution,
expressly grants exemption from realty taxes for Cemeteries, churches and
parsonages or convents appurtenant thereto, and all lands, buildings, and
improvements used exclusively for religious, charitable or educational purposes.
The use of the school building or lot for commercial purposes is neither
contemplated by law, nor by jurisprudence.
Phil lung vs Q.C 433 SCRA 119
Facts:
The petitioner Lung Center of the Philippines is a non-stock and non-profit entity
established on January 16, 1981, in Quezon City by virtue of Presidential Decree No.
1823. The ground floor is being leased to a canteen, medical professionals whom
use the same as their private clinics, as well as to other private parties. The right
portion of the lot is being leased for commercial purposes to the Elliptical Orchids
and Garden Center. Petitioner filed a Claim for Exemption from realty taxes
amounting to about Php4.5 million, predicating its claim as a charitable institution.
The city assessor denied the Claim. When appealed to the Quezon City Local Board

of Assessment, the same was dismissed. As a general principle, a charitable

institution does not lose its character as such and its exemption form taxes simply
because it derives income from paying patients, or receives subsidies from
government; and no money insures to the private benefit of the persons managing
or operating the institution.
Issue:
Whether or not the real properties of the lung center are exempt from real property
taxes.
Held:
The petition is partially granted. The court held that the petitioner as a charitable
institution within the context of the 1973 and 1987 Constitutions. To determine
whether an enterprise is a charitable institution/entity or not, the elements which
should be considered include the statute creating the enterprise, its corporate
purposes, its constitution and by-laws, the methods of administration, the nature of
the actual work performed, the character of the services rendered, the
indefiniteness of the beneficiaries, and the use and occupation of the properties.