Manila International Airport Authorityvs.

City of Pasay April 2, 2009 | Carpio Facts: Petitioner Manila International AirportAuthority (MIAA) operates and administersthe Ninoy Aquino International Airport(NAIA) Complex under Executive Order No.903 (EO 903), otherwise known as theRevised Charter of the Manila InternationalAirport Authority. Under Sections 3 and22 of EO 903, approximately 600 hectaresof land, including the runways, the airporttower, and other airport buildings, weretransferred to MIAA. The NAIA Complex islocated along the border between PasayCity and Paraaque City.MIAA received Final Notices of RealProperty Tax Delinquency from the City of Pasay for the taxable years 1992 to 2001. The City of Pasay, through its City Treasurer, issued notices of levy andwarrants of levy for the NAI A Pasayproperties. Thereafter, the City Mayor of Pasay threatened to sell at public auctionthe NAIA Pasay properties if thedelinquent real property taxes remainunpaid.MIAA filed with the Court of Appeals apetition for prohibition and injunction withprayer for preliminary injunction ortemporary restraining order. The petitionsought to enjoin the City of Pasay fromimposing real property taxes on, levyingagainst, and auctioning for public sale theNAIA Pasay properties. Court of Appeals: Upheld the power of the City of Pasay to impose and collectrealty taxes on the NAIA Pasay properties.Sections 193 and 234 of Republic Act No.7160 or the Local Government Codewithdrew the exemption from payment of real property taxes granted to natural or juridical persons, including government-owned or controlled corporations. SinceMIAA is a government-owned corporation,it follows that its tax exemption underSection 21 of EO 903 has been withdrawnupon the effectivity of the LocalGovernment Code. Issue: WON the NAIA Pasay properties of MIAAare exempt from real property tax YES. Held: 1. MIAA is a government"instrumentality" that does not qualifyas a "government-owned or controlledcorporation. Under Section 133(o) of the Local Government Code, localgovernment units have no power totax instrumentalities of the nationalgovernment. Therefore, MIAA isexempt from any kind of tax from thelocal governments.A government "instrumentality" may ormay not be a "governmentowned orcontrolled corporation" (Section 2(10) of the Introductory Provisions of theAdministrative Code of 1987). Agovernment-

owned or controlledcorporation must be "organized as a stockor nonstock corporation." MIAA is notorganized as a stock or non-stockcorporation. It is not a stock corporationbecause it has no capital stock dividedinto shares. It is also not a non-stockcorporation because it has no members. The Government cannot be considered asthe sole member of MIAA because non-stock corporations cannot distribute anypart of their income to their members.Section 11 of the MIAA Charter mandatesMIAA to remit 20% of its annual grossoperating income to the National Treasury.MIAA is like a ny other governmentinstrumentality, but is vested withcorporate powers to perform efficiently itsgovernmental functions. When the lawvests in a government instrumentalitycorporate powers, the in strumentalitydoes not become a corporation. 2. The airport lands and buildings of MIAAare properties of public dominioni n t e n d e d f o r p u b l i c use, and as s u c h a r e e x e m p t f r o m r e a l p r o p e r t y t a x under Section 234(a) of the LocalGovernment Code