Court of Tax Appeals of the Philippines

The Court of Tax Appeals of the Philippines (Filipino: Hukuman ng Paghahabol sa Buwis ng Pilipinas) is the special court of limited
jurisdiction, and has the same level with the Court of Appeals. The court consists of 8 Associate Justices and 1 Presiding Justice. The
Court of Tax Appeals is located at Agham Road, Diliman, Quezon City in Metro Manila.
History
The Court of Tax Appeals was originally created by virtue of Republic Act. No. 1125 (R.A.1125) which was enacted on June 16, 1954
composed of three (3) Judges with Mariano CH. Nable as the first Presiding Judge. With the passage of Republic Act Number 9282
(R.A. 9282) on April 23, 2004, the CTA became an appellate Court, equal in rank to the Court of Appeals. Under Section 1 of the new
law, the Court is headed by a Presiding Justice and assisted by five (5) Associate Justices. They shall have the same qualifications,
rank, category, salary, emoluments and other privileges, be subject to the same inhibitions and disqualifications and enjoy the same
retirement and other benefits as those provided for under existing laws for the Presiding Justice and Associate Justices of the Court
of Appeals. A decision of a division of the CTA may be appealed to the CTA En Banc, and the latter's decision may further be
appealed by verified petition for certiorari to the Supreme Court.
On June 16, 2014, the Court celebrated its 60th Anniversary.
Expanded jurisdiction
On June 12, 2008, Republic Act Number 9503 (R.A. 9503) was enacted and took effect on July 5, 2008. This enlarged the
organizational structure of the CTA by creating a Third Division and providing for three additional justices. Hence, the CTA is now
composed of one Presiding Justice and eight Associate Justices. The CTA may sit en banc or in three divisions with each division
consisting of three justices. The CTA, as one of the courts comprising the Philippine Judiciary, is under the supervision of the
Supreme Court of the Philippines.
Previously, only decision, judgment, ruling or inaction of the Commissioner of Internal Revenue, the Commissioner of Customs, the
Secretary of Finance, the Secretary of Trade and Industry, or the Secretary of Agriculture, involving the National Internal Revenue
Code and the Tariff and Customs Code on civil matters are appeallable to the Court of Tax Appeals. The expanded jurisdiction
transferred to the CTA the jurisdiction of the Regional Trial Courts and the Court of Appeals over matters involving criminal violation
and collection of revenues under the National Internal Revenue Code and Tariff and Customs Code. It also acquired jurisdiction over
cases involving local and real property taxes which used to be with the Regional Trial Court and the Court of Appeals.
2008 organizational expansion
Gloria Macapagal-Arroyo on June 12, 2008, signed into law Republic Act 9503 (An Act Enlarging the Organizational Structure of the
Court of Tax Appeals, Amending for the Purpose Certain Sections of the Law Creating the Court of Tax Appeals, and for Other
Purposes), which added three more members (and one more division) to the court. The new law was enacted "to expedite
disposition of tax-evasion cases and increase revenues for government to fund social services, food, oil and education subsidies and
infrastructure."
Creation, Elevation and Expansion

The Court of Tax Appeals (CTA) was created on June 16, 1954, through the enactment of Republic Act No. 1125 (R.A. 1125).
Considering its limited jurisdiction then, it had only three (3) Judges, which at present is equivalent to one (1) Division.
With the passage of Republic Act Number 9282 (R.A. 9282) on April 23, 2004, the CTA became an appellate Court, equal in rank to
the Court of Appeals. The composition of the Court increased to six (6) Justices with one (1) Presiding Justice and five (5) Associate
Justices.
It shall sit En Banc, or in two (2) Divisions with three (3) Justices each. A decision of a division of the CTA may be appealed to the CTA
En Banc, and the latter's decision may further be appealed by verified petition for certiorari to the Supreme Court.
However, Republic Act Number 9503 was enacted on June 12, 2008 and took effect on July 5, 2008. This further enlarged the
organizational structure of the CTA by creating a Third Division and providing for three (3) additional Justices. Hence, the CTA is now
composed of one (1) Presiding Justice and eight (8) Associate Justices. The CTA may sit en banc or in three (3) divisions with each
division consisting of three (3) Justices. The CTA, as one of the Courts comprising the Philippine Judiciary, is under the supervision of
the Supreme Court.
Expanded Jurisdiction

Through the enactment of Republic Act No. 9282, the jurisdiction of the CTA has been expanded to include not only civil tax cases
but also cases that are criminal in nature, as well as local tax cases, property taxes and final collection of taxes.
Pursuant to the provisions of Republic Act No. 1125 and other laws prior to R.A. 9282, the Court of Tax Appeals retains exclusive
appellate jurisdiction to review by appeal, the following:
Decisions of the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of internal revenue taxes, fees
or other charges, penalties imposed in relation thereto, or other matters arising under the National Internal Revenue Code or other
law or part of law administered by the Bureau of Internal Revenue;
Decisions of the Commissioner of Customs in cases involving liability for customs duties, fees or other money charges; seizure,
detention or release of property affected; fines, forfeitures or other penalties imposed in relation thereto; or other matters arising
under the Customs Law or other law or part of law administered by the Bureau of Customs [Rep. Act. No. 1125, (1954), Sec. 7];
In automatic review cases where such decisions of the Commission of Customs favorable to the taxpayer is elevated to the Secretary
of Finance (Sec. 2315, TCC); and
Decisions of the Secretary of Trade and Industry, in the case of non-agricultural product, commodity or article, or the Secretary of
Agriculture, in the case of agricultural product, commodity or article, in connection with the imposition of the Anti-Dumping Duty,
Countervailing and Safeguard Duty [Republic Act Nos. 8751 and 8752, (1999) Sec. 301 (a) and (p), and Republic Act 8800].
Under Republic Act Number 9282, the CTA's original appellate jurisdiction was expanded to include the following:
Criminal cases involving violations of the National Internal Revenue Code and the Tariff and Customs Code;
Decisions of the Regional Trial Courts (RTC) in local tax cases;
Decisions of the Central Board of Assessment Appeals (CBAA) in cases involving the assessment and taxation of real property; and
Collection of internal revenue taxes and customs duties the assessment of which have already become final.
WHEN DOES THE SUSPENSION OF THE FIVE (5)-YEAR PRESCRIPTION PERIOD TO COLLECT COMMENCE?
In G.R. No. 197515 (Commissioner of Internal Revenue vs. United Salvage and Towage (Phils.), Inc.), the Supreme Court (SC) said that the request for reinvestigation
should be granted or at least acted upon in due course before the suspension of the statute of limitations to collect may set in.

In the instant case, the final assessment notice (FAN) was issued by the BIR on January 9, 1996 and the taxpayer requested for a reinvestigation on March 14, 1997.
However, the BIR granted such request only on January 22, 2001 or after five (5) years from the date of the issuance of the FAN. Further, the BIR issued Preliminary
Collection Letter only on February 21, 2002.

The BIR argued that its right to collect the tax assessment has not yet prescribed. The five (5)-year prescriptive period to collect was interrupted when the taxpayer
filed its request for reinvestigation. Thus, the period for tax collection should have begun to run from the date of the reconsidered or modified assessment.

This argument failed to persuade the SC. The Court emphasized the rule that the Commissioner of the BIR must first grant the request for reinvestigation as a
requirement for the suspension of the statute of limitations. The act of requesting a reinvestigation alone does not suspend the period. The request should first be
granted, in order to effect suspension.

The Court pointed out that while the request for reinvestigation was made on March 14, 1997, the same was only acted upon by the BIR on January 22, 2001 which is
beyond the three (3) year statute of limitations from the issuance of the FAN on January 9, 1996. Further, the Court stressed that the Preliminary Collection Letter
was only issued on February 21, 2002 which is clearly five (5) long years had already lapsed before collection was pursued by the BIR.

Moreover, the Court rejected the BIR’s argument that the taxpayer’s act of elevating its protest to the Court of Tax Appeals has fortified the continuing interruption
of the BIR’s prescriptive period to collect. The Court found the argument flawed at best because the taxpayer was merely exercising its right to resort to the proper
Court and does not in any way deter the BIR’s right to collect taxes from the taxpayer under existing laws.

The Court also elucidated that the statute of limitations on the collection of taxes was enacted to benefit and protect the taxpayers. Just as the government is
interested in the stability of its collections, the taxpayers are also entitled to an assurance that they will not be subjected to further investigation for tax purposes
after the expiration of a reasonable period of time.

While it is true that taxes are the lifeblood of the government, it must be exercised fairly, equally and uniformly so as not for the tax collector to kill the “hen that lays
the golden egg.”

Nikkolai F. Canceran is a manager with the Tax Advisory and Compliance Division of Punongbayan & Araullo. P&A is a leading audit, tax, advisory and outsourcing
services firm and is the Philippine member of Grant Thornton International Ltd.
 G.R. No. 173176
JUDY ANNE L. SANTOS, Petitioner,
Vs.
PEOPLE OF THE PHILIPPINESand BUREAU OF INTERNAL REVENUE, Respondents

Before this Court is a Petition for Review on Certiorari under Rule 45 of the Revised Rules of Court filed by petitioner Judy Anne L. Santos (Santos) seeking the reversal
and setting aside of the Resolution, dated 19 June 2006, of the Court of Tax Appeals (CTA) en banc in C.T.A. EB. CRIM. No. 001 which denied petitioner’s Motion for
Extension of Time to File Petition for Review. Petitioner intended to file the Petition for Review with the CTA en banc to appeal the Resolutions dated 23 February
2006 and 11 May 2006 of the CTA First Division in C.T.A. Crim. Case No. 0-012 denying, respectively, her Motion to Quash the Information filed against her for
violation of Section 255, in relation to Sections 254 and 248(B) of the National Internal Revenue Code (NIRC), as amended; and her Motion for Reconsideration.

On 19 May 2005, then Bureau of Internal Revenue (BIR) Commissioner Guillermo L. Parayno, Jr. wrote to the Department of Justice (DOJ) Secretary Raul M. Gonzales
a letter regarding the possible filing of criminal charges against petitioner. BIR Commissioner Parayno began his letter with the following statement:

I have the honor to refer to you for preliminary investigation and filing of an information in court if evidence so warrants, the herein attached Joint Affidavit of
RODERICK C. ABAD, STIMSON P. CUREG, VILMA V. CARONAN, RHODORA L. DELOS REYES under Group Supervisor TEODORA V. PURINO, of the National Investigation
Division, BIR National Office Building, BIR Road, Diliman, Quezon City, recommending the criminal prosecution of MS. JUDY ANNE LUMAGUI SANTOS for substantial
underdeclaration of income, which constitutes as prima facie evidence of false or fraudulent return under Section 248(B) of the NIRC and punishable under Sections
254 and 255 of the Tax Code.

In said letter, BIR Commissioner Parayno summarized the findings of the investigating BIR officers that petitioner, in her Annual Income Tax Return for taxable year
2002 filed with the BIR, declared an income of P8,033,332.70 derived from her talent fees solely from ABS-CBN; initial documents gathered from the BIR offices and
those given by petitioner’s accountant and third parties, however, confirmed that petitioner received in 2002 income in the amount of at least P14,796,234.70, not
only from ABS-CBN, but also from other sources, such as movies and product endorsements; the estimated tax liability arising from petitioner’s under declaration
amounted to P1,718,925.52, including incremental penalties; the non-declaration by petitioner of an amount equivalent to at least 84.18% of the income declared in
her return was considered a substantial under declaration of income, which constituted prima facie evidence of false or fraudulent return under Section 248(B) of the
NIRC, as amended; and petitioner’s failure to account as part of her income the professional fees she received from sources other than ABS-CBN and her under
declaration of the income she received from ABS-CBN amounted to manifest violations of Sections 254 and 255, as well as Section 248(B) of the NIRC, as amended.

As regards petitioner’s second ground in her intended Petition for Review with the CTA en banc, she asserts that she has been denied due process and equal
protection of the laws when similar charges for violation of the NIRC, as amended, against Regina Encarnacion A. Velasquez (Velasquez) were dismissed by the DOJ in
its Resolution dated 10 August 2005 in I.S. No. 2005-330 for the reason that Velasquez’s tax liability was not yet fully determined when the charges were filed.

Issue: WON petitioner was denied of equal protection of law.

Held:

Petitioner cannot claim denial of due process when she was given the opportunity to file her affidavits and other pleadings and submit evidence before the DOJ
during the preliminary investigation of her case and before the Information was filed against her. Due process is merely an opportunity to be heard. In addition,
preliminary investigation conducted by the DOJ is merely inquisitorial. It is not a trial of the case on the merits. Its sole purpose is to determine whether a crime has
been committed and whether the respondent therein is probably guilty of the crime. It is not the occasion for the full and exhaustive display of the parties’ evidence.
Hence, if the investigating prosecutor is already satisfied that he can reasonably determine the existence of probable cause based on the parties’ evidence thus
presented, he may terminate the proceedings and resolve the case.

The equal protection clause exists to prevent undue favor or privilege. It is intended to eliminate discrimination and oppression based on inequality. Recognizing the
existence of real differences among men, the equal protection clause does not demand absolute equality. It merely requires that all persons shall be treated alike,
under like circumstances and conditions, both as to the privileges conferred and liabilities enforced.

Petitioner was not able to duly establish to the satisfaction of this Court that she and Velasquez were indeed similarly situated, i.e., that they committed identical acts
for which they were charged with the violation of the same provisions of the NIRC; and that they presented similar arguments and evidence in their defense - yet,
they were treated differently.

SMAR T COMMUNIC ATI O N, INC V S. MUNICIP ALI TY OF MALVAR,BATANGAS

G.R NO. 204429, FEBRUARY 18, 2014
FACTS

Smart constructed a telecommunications tower within the territorial jurisdiction of the Municipality of Malvar, Batangas. The construction of the tower was for the
purpose of receiving and transmitting cellular communications within the covered area.

Subsequently, Municipality of Malvar passed Ordinance No. 18 series of 2003, entitled "An Ordinance Regulating the Establishment of Special Projects."

Thereafter, Smart received from the Permit and Licensing Division of the Office of the Mayor of the Municipality an assessment letter with a schedule of payment for
the total amount of P389,950.00 for Smart’s telecommunications tower. And due to arrears in the payment of the assessment, the Municipality also caused the
posting of a closure notice on the telecommunications tower.

Uh oh..

So Smart filed a protest in the Court of Tax Appeal claiming lack of due process in the issuance of the assessment and closure notice. In the same protest, Smart
challenged the validity of Ordinance No. 18 on which the assessment was based.

CTA dismissed the case for lack of jurisdiction stating the same is NOT a tax, therefore not cognizant by said court. But the RTC which heard the case partially granted
Smart’s petition. The thing is, it did not rule on the legality of Ordinance No. 18. The RTC affirmed the CTA ruling and held that LGUs have the power to impose fees.

Here's SMART’s arguments:

CTA erred in refusing to take cognizance of the case and for dismissing the case for lack of jurisdiction considering the “unique” factual circumstances involved. The
fees imposed in Ordinance No. 18 are actually taxes since they are not regulatory but rather, revenue-raising.

Furthermore Smart averred Municipality is encroaching on the regulatory powers of the National Telecommunications Commission (NTC). Smart cites Section 5(g) of
RA 7925 which provides that the NTC, in the exercise of its regulatory powers, shall impose such fees and charges as may be necessary to cover reasonable costs and
expenses for the regulation and supervision of the operations of telecommunications entities.

Thus, Smart alleges that the regulation of telecommunications entities and all aspects of its operations is specifically lodged by law on the NTC.

Malvar’s arguments:

Said Ordinance is not a tax ordinance but a regulatory fee imposed to regulate the “placing, stringing, attaching, installing, repair and construction of all gas mains,
electric, telegraph and telephone wires, conduits, meters and other apparatus, and provide for the correction, condemnation or removal of the same when found to
be dangerous, defective or otherwise hazardous to the welfare of the inhabitant.
It was also envisioned to address the foreseen "environmental depredation" to be brought about by these "special projects" to the Municipality.

Pursuant to these objectives, the Municipality imposed fees on various structures, which included telecommunications towers.

The fees are not imposed to regulate the administrative, technical, financial, or marketing operations of telecommunications entities, such as Smart’s but rather, to
regulate the installation and maintenance of physical structures such as Smart’s cell sites or telecommunications tower.

ISSUE:

WON 1. the fees are taxes and 2. WON CTA should have take cognizance of the case.

RULING:

Court said NO to both issues raised. Court DENIES the petition.

1st Issue:

Since the main purpose of Ordinance No. 18 is to regulate certain construction activities of the identified special projects, which included "cell sites" or
telecommunications towers, the fees imposed in Ordinance No. 18 are primarily regulatory in nature, and not primarily revenue-raising.

While the fees may contribute to the revenues of the Municipality, this effect is merely incidental. Thus, the fees imposed in Ordinance No. 18 are not taxes.

Court points out in the following jurisprudence:

Progressive Development Corporation v. Quezon City:

If the generating of revenue is the primary purpose and regulation is merely incidental, the imposition is a tax; but if regulation is the primary purpose, the fact that
incidentally revenue is also obtained does not make the imposition a tax.

Victorias Milling Co., Inc. v. Municipality of Victorias:

The purpose and effect of the imposition determine whether it is a tax or a fee, and that the lack of any standards for such imposition gives the presumption that the
same is a tax.

Ordinance No. 18 expressly provides for the standards which Smart must satisfy prior to the issuance of the specified permits, clearly indicating that the fees are
regulatory in nature.

And even if the fees do not appear in Section 143 or any other provision in the LGC, the Municipality is empowered to impose taxes, fees and charges, not specifically
enumerated in the LGC or taxed under the Tax Code or other applicable law according to Section 186 of the LGC. Thus they don’t encroach on NTC’s powers.

2nd Issue:

Considering that the fees in Ordinance No. 18 are not in the nature of local taxes, and Smart is questioning the constitutionality of the ordinance, the CTA correctly
dismissed the petition for lack of jurisdiction.

Likewise, Section 187 of the LGC, which outlines the procedure for questioning the constitutionality of a tax ordinance, is inapplicable, rendering unnecessary the
resolution of the issue on non-exhaustion of administrative remedies.

Court said..

An ordinance carries with it the presumption of validity. The question of reasonableness though is open to judicial inquiry. Much should be left thus to the discretion
of municipal authorities.

Courts will go slow in writing off an ordinance as unreasonable unless the amount is so excessive as to be prohibitive, arbitrary, unreasonable, oppressive, or
confiscatory.

A rule which has gained acceptance is that factors relevant to such an inquiry are the municipal conditions as a whole and the nature of the business made subject to
imposition.

To justify the nullification of the law or its implementation, there must be a clear and unequivocal, not a doubtful, breach of the Constitution.

In case of doubt in the sufficiency of proof establishing unconstitutionality, "the Court must sustain legislation because "to invalidate [a law] based on baseless
supposition is an affront to the wisdom not only of the legislature that passed it but also of the executive which approved it."

So Smart loses this case.

Taxation Law – 120+30 Day Mandatory Period (Refund or Tax Credit of Input Taxes)

Silicon Philippines, Inc. (Formerly Intel Philippines Manufacturing, Inc.) vs. Commissioner
of Internal Revenue (GR No. 182737, March 02, 2016)
Ponente: Chief Justice Sereno
Doctrine:
Respondent (Commissioner of Internal Revenue) is given a period of 120 days within which to (1) grant a refund or issue the tax credit certificate for creditable input
taxes; or (2) make a full or partial denial of the claim for a tax refund or tax credit. Failure on the part of respondent to act on the application within the 120-day
period shall be deemed a denial.

Note that the 120-day period begins to run from the date of submission of complete documents supporting the administrative claims. If there is no evidence showing
that the taxpayer was required to submit – or actually submitted – additional documents after the filing of the administrative claim, it is presumed that the
complete documents accompanied the claim when it was filed.
The judicial claim shall be filed within a period of 30 days after the receipt of respondent’s decision or ruling or after the expiration of the 120-day period, whichever
is sooner.
Aside from a specific exception to the mandatory and jurisdictional nature of the periods provided by the law, any claim filed in a period less than or beyond the
120+30 days provided by the NIRC is outside the jurisdiction of the CTA.
Facts:
Petitioner is a corporation engaged in the business of designing, developing, manufacturing and exporting integrated circuit components. It is a preferred pioneer
enterprise registered with the Board of Investments. It is likewise registered with the Bureau of Internal Revenue (BIR) as a VAT taxpayer by virtue of its sale of goods
and services with a permit to print accounting documents like sales invoices and official receipts.
Petitioner sought to recover the VAT it paid on imported capital goods for the 2nd, 3rd and 4th quarters of 2001, therefore, it filed for a tax credit / refund to the CIR.
However, the Honorable Supreme Court has ruled that the judicial claims were filed beyond the 120+30 day period.

Issues:
Whether or not the Court of Tax Appeals has acquired jurisdiction over the case;

Held:
No, the CTA did not acquire jurisdiction over the case ergo their rulings are not decisions in contemplation of law. The Honorable Supreme Court stated that:
“Upon the filing of an administrative claim, respondent is given a period of 120 days within which to (1) grant a refund or issue the tax credit certificate for creditable
input taxes; or (2) make a full or partial denial of the claim for a tax refund or tax credit. Failure on the part of respondent to act on the application within the 120-day
period shall be deemed a denial.
Note that the 120-day period begins to run from the date of submission of complete documents supporting the administrative claims. If there is no evidence showing
that the taxpayer was required to submit – or actually submitted – additional documents after the filing of the administrative claim, it is presumed that the complete
documents accompanied the claim when it was filed.
Considering that there is no evidence in this case showing that petitioner made later submissions of documents in support of its administrative claims, the 120-day
period within which respondent is allowed to act on the claims shall be reckoned from 16 October 1 and 4 September 2002.
x x x x x x
The judicial claim shall be filed within a period of 30 days after the receipt of respondent’s decision or ruling or after the expiration of the 120-day period, whichever
is sooner.
Aside from a specific exception to the mandatory and jurisdictional nature of the periods provided by the law, any claim filed in a period less than or beyond the
120+30 days provided by the NIRC is outside the jurisdiction of the CTA.”

G.R. No. 175723, February 4, 2014 THE CITY OF MANILA ETC., ET AL. v. HON. CARIDAD H. GRECIA-CUERDO ETC., ET AL

G.R. No. 175723, February 4, 2014

THE CITY OF MANILA ETC., ET AL. v. HON. CARIDAD H. GRECIA-CUERDO ETC., ET AL
PERALTA, J.:

NATURE:
This is a special civil action for certiorari under Rule 65 of the Rules of Court seeking to reverse and set aside the
Resolutions1 dated April 6, 2006 and November 29, 2006 of the Court of Appeals.

FACTS:
Petitioner City of Manila, through its treasurer, petitioner Liberty Toledo, assessed taxes for the taxable period from
January to December 2002 against the private respondents.In addition to the taxes purportedly due from private
respondents pursuant to Section 14, 15, 16, 17 of the Revised Revenue Code of Manila (RRCM), said assessment
covered the local business taxes. private respondents were constrained to pay the P 19,316,458.77 assessment under
protest.

On January 24, 2004, private respondents filed before the RTC of Pasay City the complaint denominated as one for
“Refund or Recovery of Illegally and/or Erroneously–Collected Local Business Tax, Prohibition with Prayer to Issue TRO
and Writ of Preliminary Injunction
The RTC granted private respondents’ application for a writ of preliminary injunction.

Petitioners filed a Motion for Reconsideration4 but the RTC denied. Petitioners then filed a special civil action
for certiorari with the CA but the CA dismissed petitioners’ petition for certiorari holding that it has no jurisdiction over the
said petition. The CA ruled that since appellate jurisdiction over private respondents’ complaint for tax refund, which was
filed with the RTC, is vested in the Court of Tax Appeals (CTA), pursuant to its expanded jurisdiction under Republic Act
No. 9282 (RA 9282), it follows that a petition for certiorari seeking nullification of an interlocutory order issued in the said
case should, likewise, be filed with the CTA.

Petitioners filed a Motion for Reconsideration,7 but the CA denied it in its Resolution hence, this petition

ISSUE:
Whether or not the CTA has jurisdiction over a special civil action for certiorari assailing an interlocutory order issued by
the RTC in a local tax case.

HELD:
The CTA has jurisdiction over a special civil action for certiorari assailing an interlocutory order issued by the RTC in a
local tax case. In order for any appellate court to effectively exercise its appellate jurisdiction, it must have the authority to
issue, among others, a writ of certiorari. In transferring exclusive jurisdiction over appealed tax cases to the CTA, it can
reasonably be assumed that the law intended to transfer also such power as is deemed necessary, if not indispensable, in
aid of such appellate jurisdiction. There is no perceivable reason why the transfer should only be considered as partial,
not total.
Consistent with the above pronouncement, the Court has held as early as the case of J.M. Tuason & Co., Inc. v.
Jaramillo, et al. [118 Phil. 1022 (1963)] that “if a case may be appealed to a particular court or judicial tribunal or body,
then said court or judicial tribunal or body has jurisdiction to issue the extraordinary writ of certiorari, in aid of its appellate
jurisdiction.” This principle was affirmed in De Jesus v. Court of Appeals (G.R. No. 101630, August 24, 1992) where the
Court stated that “a court may issue a writ of certiorari in aid of its appellate jurisdiction if said court has jurisdiction to
review, by appeal or writ of error, the final orders or decisions of the lower court.

FALLO: petition is denied

 City of Lapu Lapu vs. PEZA
G.R. no. 184203
Facts:
In 1995, the PEZA was created by virtue of Republic Act No. 7916 or “the Special Economic Zone Act of 1995” to operate,
administer, manage, and develop economic zones in the country. The PEZA was granted the power to register, regulate, and
supervise the enterprises located in the economic zones. By virtue of the law, the export processing zone in Mariveles, Bataan
became the Bataan Economic Zone and the Mactan Export Processing Zone the Mactan Economic Zone.
The City contends that due to the enactment of the LGC, specifically withdrawing all tax exemptions and with the PEZA law of 1995
which did not have any provisions on tax exemptions, it maintains that PEZA is liable for real property tax.

Issue: Whether or not PEZA should be exempted from real property taxation.

Held: Yes. Under Section 234(a) of the Local Government Code, real properties owned by the Republic of the Philippines are exempt
from real property taxes. Properties owned by the state are either property of public dominion or patrimonial property as per Art.
420.
Citing Manila International Airport Authority: Properties of public dominion, being for public use, are not subject to levy,
encumbrance or disposition through public or private sale. Any encumbrance, levy on execution or auction sale of any property of
public dominion is void for being contrary to public policy. Essential public services will stop if properties of public dominion are
subject to encumbrances, foreclosures and auction sale.
In this case, the properties sought to be taxed are located in publicly owned economic zones. These economic zones are property of
public dominion – sites which were reserved by President Marcos under Proclamation No. 1811, Series of 1979 (Mactan).
Petition Denied.

TITLE I
The Shari'a Courts

Art. 137. Creation. — There are hereby created as part of the judicial system, courts of limited jurisdiction, to be
known respectively as Shari'a District Courts and Shari'a Circuit Courts, which shall exercise powers and functions in
accordance with this Title.

Shari'a courts and the personnel thereof shall be subject to the administrative supervision of the Supreme Court.

CHAPTER I
Shari'a District Courts

Art. 138. Shari'a judicial districts. — Five special judicial districts, each to have one Shari'a District Court presided over
by one judge, are constituted as follows:chanroblesvirtuallawlibrary

(a) The First Shari'a District shall comprise the Province of Sulu;

(b) The Second Shari'a District, the Province of Tawi-Tawi;

(c) The Third Shari'a District, the Province of Basilan, Zamboanga del Norte and Zamboanga del Sur, and the Cities of
Dipolog, Pagadian and Zamboanga;

(d) The Fourth Shari'a District, the provinces of Lanao del Norte and Lanao del Sur, and the Cities of Iligan and Marawi;
and

(e) The Fifth Shari'a District, the Provinces of Maguindanao, North Cotabato and Sultan Kudarat, and the City of
Cotabato;

Art. 139. Appointment of judges. — The judicial function in the Shari'a District Courts shall be vested in Shari'a District
judges to be appointed by the President of the Philippines. . chanrobles virtual law library

Art. 140. Qualifications. — No person shall be appointed Shari'a District judge unless, in addition to the qualifications
for judges of Courts of First Instance fixed in the Judiciary Law, he is learned in Islamic law and jurisprudence.

Art. 141. Tenure. — Shari'a District judges shall be appointed to serve during good behavior until they reach the age of
sixty-five years, or become incapacitated to discharge the duties of their office, unless sooner removed for the same
causes and in the same manner provided by law for judges of Courts of First Instance.

Art. 142. Compensation. — Shari'a District judges shall receive the same compensation and enjoy the same privileges
as the judges of Courts of First Instance.

Art. 143. Original jurisdiction. — (1) The Shari'a District Court shall have exclusive original jurisdiction
over:chanroblesvirtuallawlibrary

(a) All cases involving custody, guardianship, legitimacy, paternity and filiation arising under this Code;

(b) All cases involving disposition, distribution and settlement of the estate of deceased Muslims, probate of wills,
issuance of letters of administration or appointment of administrators or executors regardless of the nature or the
aggregate value of the property;

(c) Petitions for the declaration of absence and death and for the cancellation or correction of entries in the Muslim
Registries mentioned in Title VI of Book Two of this Code;
(d) All actions arising from customary contracts in which the parties are Muslims, if they have not specified which law
shall govern their relations; and

(e) All petitions for mandamus, prohibition, injunction, certiorari, habeas corpus, and all other auxiliary writs and
processes in aid of its appellate jurisdiction. . chanrobles virtual law library

(2) Concurrently with existing civil courts, the Shari'a District Court shall have original jurisdiction over:

(a) Petitions by Muslims for the constitution of a family home, change of name and commitment of an insane person to
an asylum;

(b) All other personal and real actions not mentioned in paragraph 1 (d) wherein the parties involved are Muslims
except those for forcible entry and unlawful detainer, which shall fall under the exclusive original jurisdiction of the
Municipal Circuit Court; and

(c) All special civil actions for interpleader or declaratory relief wherein the parties are Muslims or the property
involved belongs exclusively to Muslims.

Art. 144. Appellate jurisdiction. — (1) Shari'a District Courts shall have appellate jurisdiction over all cases tried in the
Shari'a Circuit Courts within their territorial jurisdiction. . chanrobles virtual law library

(2) The Shari'a District Court shall decide every case appealed to it on the basis of the evidence and records
transmitted as well as such memoranda, briefs or oral arguments as the parties may submit.

Art. 145. Finality of decision. — The decisions of the Shari'a District Courts whether on appeal from the Shari'a Circuit
Court or not shall be final. Nothing herein contained shall affect the original and appellate jurisdiction of the Supreme
Court as provided in the Constitution.

Art. 146. Clerks and other subordinate employees. — Shari'a District Courts shall have the same officers and other
personnel as those provided by law for Courts of First Instance.

The pertinent provisions of the Judiciary Law regarding the number, qualifications, appointment, compensation,
functions, duties and other matters relative to the personnel of the Courts of First Instance shall apply to those of the
Shari'a District Courts.

Art. 147. Permanent stations; offices. — (1) The Shari'a District Courts shall have their respective permanent stations
in the following places:chanroblesvirtuallawlibrary . chanrobles virtual law library

(a) First Shari'a District, Jolo, Sulu; .

(b) Second Shari'a District, Bongao, Tawi-Tawi; .

(c) Third Shari'a District, Zamboanga City; .

(d) Fourth Shari'a District, Marawi City; .

(e) Fifth Shari'a District, Cotabato City; .

(2) The Shari'a District Courts may hold sessions anywhere within their respective districts. . (3) The provinces, cities
or municipalities concerned shall provide such courts with adequate court office, supplies and equipment in accordance
with the provisions of the Judiciary Law. . chanrobles virtual law library

Art. 148. Special procedure. — The Shari'a District Courts shall be governed by such special rules of procedure as the
Supreme Court may promulgate.

Art. 149. Applicability of other laws. — The provisions of all laws relative to the Courts of First Instance shall, insofar as
they are not inconsistent with this Code, be applicable to Shari'a District Courts.

CHAPTER II
Shari'a Circuit Courts
.

Art. 150. Where established. — (1) Shari'a Circuit Courts shall be established as follows:chanroblesvirtuallawlibrary

(a) Six such courts in the Province of Sulu;

(b) Eight in the Province of Tawi-Tawi;

(c) Ten in and for the Provinces of Basilan, Zamboanga del Norte and Zamboanga del Sur, and the Cities of Dipolog,
Pagadian, and Zamboanga;

(d) Twelve in and for the Provinces of Lanao del Norte and Lanao del Sur and the Cities of Iligan and Marawi;

(e) Fifteen in and for the Province of Maguindanao, North Cotabato and Sultan Kudarat and the City of Cotabato.

(2) The territorial jurisdiction of each of the 'Shari'a Circuit Courts shall be fixed by the Supreme Court on the basis of
geographical contiguity of the municipalities and cities concerned and their Muslim population.
Art. 151. Appointment of judges. — Each Shari'a Circuit Court shall be presided over by a Shari'a Circuit Judge to be
appointed by the President of the Philippines. .

Art. 152. Qualifications. — No person shall be appointed judge of the Shari'a Circuit Court unless he is a natural-born
citizen of the Philippines, at least twenty-five years of age, and has passed an examination in the Shari'a and Islamic
jurisprudence (fiqh) to be given by the Supreme Court for admission to special membership in the Philippine Bar to
practice in the Shari'a Courts.

Art. 153. Tenure. — Shari'a Circuit judges shall be appointed to serve during good behavior until they reach the age of
sixty-five years or become incapacitated to discharge the duties of their office, unless sooner removed for the same
causes and in the same manner provided by law for judges of Municipal Circuit Courts.

Art. 154. Compensation. — Shari'a Circuit judges shall receive the same compensation and enjoy the same privileges as
judges of Municipal Circuit Courts.

ARTICLE 155. Jurisdiction. — The Shari'a Circuit Courts shall have exclusive original jurisdiction over;

(1) All cases involving offenses defined and punished under this Code.

(2) All civil actions and proceedings between parties who are Muslims or have been married in accordance with Article
13 involving disputes relating to

(a) Marriage;

(b) Divorce recognized under this Code; (c) Betrothal or breach of contract to marry; (d) Customary dower (mahr);

(e) Disposition and distribution of property upon divorce;

(f) Maintenance and support, and consolatory gifts, (mut'a); and

(g) Restitution of marital rights.

(3) All cases involving disputes relative to communal properties.

Art. 156. Clerks and other subordinate employees. — (1) Shari'a Circuit Courts shall have the same officers and other
personnel as those provided by law for Municipal Circuit Courts.

(2) The pertinent provisions of the Judiciary Law regarding the number, qualifications, appointment, compensation,
functions, duties and other matters relative to the personnel of the Municipal Circuit Courts shall apply to those of the
Shari'a Circuit Courts.

Art. 157. Place of sessions; stations. — Shari'a Circuit Court may hold session anywhere within their respective
circuits, but each shall have a principal station to be fixed by the Supreme Court.

Art. 158. Special procedure. — The Shari'a Circuit Courts shall be governed by such special rules of procedure as the
Supreme Court may promulgate.

Art. 159. Applicability of other laws. — The provisions of all laws relative to Municipal Circuit Courts shall, to the extent
that they are not inconsistent with this Code, be applicable to the Shari'a Circuit Courts.

ARTICLE VIII
ADMINISTRATION OF JUSTICE

Section 1. Exercise of Judicial Power. - The judicial powers shall be vested in the Supreme Court and in such lower courts as may be established by law including the
Shari'ah Courts in accordance with Section 5 hereof.

Section 2. Justices from Autonomous Region. - It shall be the policy of the central government or national government that, whenever feasible, at least one (1) justice in
the Supreme Court and two (2) justices in the Court of Appeals shall come from qualified jurists of the autonomous region. For this purpose, the Regional Governor
may, after consultations with the Regional Assembly and concerned sectors in the autonomous region, submit the names of qualified persons to the Judicial and Bar
Council for its consideration. The appointments of those recommended by the Regional Governor to the judicial positions mentioned above are without prejudice to
appointments that may be extended to other qualified inhabitants of the autonomous region to other positions in the Judiciary.

Section 3. Consultant to the Judicial and Bar Council. - The President shall appoint a qualified person as a consultant to the Judicial and Bar Council recommended by
the Regional Governor in consultation with the concerned sectors of the autonomous region. The person recommended by the Regional Governor shall first be
confirmed by the Regional Assembly. Once appointed by the President, the consultant shall sit with the Judicial and Bar Council only to advise and be consulted by the
council on matters of appointments to judicial positions in the autonomous region.

Section 4. Deputy Court Administrator. - The Office of the Deputy Court Administrator for the autonomous region is hereby created. The Deputy Court Administrator
for the autonomous region shall be appointed by the Chief Justice of the Supreme Court from among three recommendees submitted by the Regional Governor upon
previous confirmation by the Regional Assembly and after consultation with the concerned sectors of the autonomous region.

Section 5. Shari'ah Courts. - The Regional Assembly of the autonomous region shall provide for the establishment of Shari'ah courts. Shari'ah courts existing as of the
date of the approval of this Organic Act shall continue to discharge their duties. The judges, thereof, may, however, be reshuffled upon recommendation of the Deputy
Court Administrator of the autonomous region.

Section 6. Shari'ah Public Assistance Office. - There is hereby created a Shari'ah Public Assistance Office. The Office shall be staffed by a director and two (2) lawyers
who are members of the Philippine Shari'ah bar. They may be assisted by such personnel as may be determined by the Regional Assembly. Unless otherwise provided
by regional law, the compensation of the director and the Shari'ah lawyers shall be equivalent to the salary grade of a Director III and a trial lawyer of the Public
Assistance Office, respectively.
The Shari'ah Public Assistance Office is hereby established in each of the Shari'ah judicial districts to provide free legal assistance to poor or indigent party litigants.

Section 7. Shari'ah Appellate Court. -There is hereby created a Shari'ah Appellate Court which shall have jurisdiction over cases enumerated in Section 9 of this Article.

Section 8. Shari'ah Appellate Court Composition. - The Shari'ah Appellate Court shall be composed of one (1) presiding justice and two (2) associate justices. Any
vacancy shall be filled within ninety (90) days from the occurrence thereof.

Section 9. Jurisdiction of the Shari'ah Appellate Court. -The Shari'ah Appellate Court shall:

(a)Exercise original jurisdiction over petitions for certiorari, prohibition, mandamus, habeas corpus, and other auxiliary writs and processes only in aid of its
appellate jurisdiction; and,

(b)Exercise exclusive appellate jurisdiction over all cases tried in the Shari'ah district courts as established by law.

Section 10. Shari'ah Appellate Court Decisions. - The decisions of the Shari'ah Appellate Court shall be final and executory. Nothing herein contained shall, however,
affect the original and appellate jurisdiction of the Supreme Court, as provided in the Constitution.

Section 11. Shari'ah Appellate Court Justices Qualifications and Appointments. - The Justices of the Shari'ah Appellate Court shall possess the same qualifications as
those of the Justices of the Court of Appeals and, in addition, shall also be learned in Islamic law and jurisprudence.

The members of the Shari'ah Appellate Court shall be appointed by the President from a list of at least three (3) nominees prepared by the Judicial and Bar Council. The
nominees shall be chosen from a list of recommendees submitted by the Regional Assembly. Such appointments need no confirmation.

Section 12. Shari'ah Appellate Court Justices Tenure of Office. - The Presiding Justice and Associate Justices of the

Shari'ah Appellate Court shall serve until they reach the age of seventy (70) years, unless sooner removed for cause in the same manner as justices of the Court of
Appeals or become incapacitated to discharge the duties of their office.

Section 13. Shari'ah Appellate Court Justices Compensation. - The Presiding Justice and Associate Justices of the Shari'ah Appellate Court shall receive the same
compensation and enjoy the same privileges as the Presiding Justice and Associate Justices of the Court of Appeals, respectively.

Section 14. Shari'ah Appellate Court Administrator and Clerk of Court. - The Supreme Court shall, upon recommendation of the Presiding Justice of the Shari'ah
Appellate Court, appoint the court administrator and clerk of court of the Appellate Court. Such other personnel as may be necessary for the Shari'ah Appellate Court
shall be appointed by the Presiding Justice of said court.

The pertinent provisions of existing law regarding the qualifications, appointments, compensations, functions, duties, and other matters relative to the personnel of the
Court of Appeals shall apply to those of the Shari'ah Appellate Court.

Section 15. Prohibition Against Holding of Other Offices. -The Justices of the Shari'ah Appellate Court and the judges of other Shari'ah courts shall not be appointed or
designated to any office or agency performing quasi-judicial or administrative functions.

Section 16. Shari'ah Appellate Court Official Seat. - The official seat of the Shari'ah Appellate Court shall unless the Supreme Court decides otherwise, be in the
province or city where the seat of the Regional Government is located.

Section 17. Shari'ah Appellate Court Proceedings. -Proceedings in the Shari'ah Appellate Court and in the Shari'ah lower courts in the autonomous region shall be
governed by such special rules as the Supreme Court may promulgate.

Section 18. Shari'ah Courts. - The Shari'ah district courts and the Shari'ah circuit courts created under existing laws shall continue to function as provided therein. The
judges of the Shari'ah courts shall have the same qualifications as the judges of the regional trial courts, the metropolitan trial courts or the municipal trial courts, as the
case may be. In addition, they must be learned in Islamic law and jurisprudence.

Section 19. Tribal Courts. - There is hereby created a system of tribal courts, which may include a Tribal Appellate Court, for the indigenous cultural communities in
the autonomous region. These courts shall determine, settle, and decide controversies and enforce decisions involving personal and family and property rights of
members of the indigenous cultural community concerned in accordance with the tribal codes of these communities. These courts may also exercise exclusive
jurisdiction over crimes committed by members of indigenous cultural communities where the imposable penalty as prescribed by the Revised Penal Code or other
pertinent law does not exceed imprisonment of six (6) years or a fine not exceeding Fifty thousand pesos (P50,000) or both such imprisonment and fine and where the
offended party or parties are also members of the indigenous cultural community concerned.

The Regional Assembly shall define the composition and jurisdiction of the said courts in accordance with the Constitution, existing laws, and this Organic Act.

Section 20. Jurisconsult in Islamic Law. - The Regional Assembly shall give priority consideration to the organization of the office of jurisconsult in Islamic law as
established under existing law and provision for its facilities to enable the proper functioning of the office.

Section 21. Customary Law. - The Regional Assembly shall provide for the codification of indigenous laws and compilation of customary laws of the Muslims and the
indigenous cultural communities in the autonomous region.

Section 22. Application and Interpretation of Laws. - The provisions of the Muslim code and the tribal code shall be applicable only to Muslims and other members of
indigenous cultural communities respectively and nothing herein shall be construed to operate to the prejudice of the non-Muslims and non-members of indigenous
cultural communities.

In case of conflict between the Muslim code and the tribal code, the national law shall apply.

In case of conflict between the Muslim code or the tribal code on the one hand, and the national law on the other, the latter shall prevail.

Except in cases of successional rights to property, the regular courts shall acquire jurisdiction over controversies involving real property located outside the area of
autonomy. Muslims who sue other Muslims or members of indigenous cultural communities who sue other members of indigenous cultural communities over matters
covered respectively by Shari'ah or by tribal laws may agree to litigate their grievances before the proper Shari'ah or tribal court in the autonomous region. The
procedure for this recourse to the Shari'ah or tribal court shall be prescribed by the Supreme Court.

Section 23. Bases for Interpretation of Islamic Law. - Subject to the provisions of the Constitution, the Shari'ah courts shall interpret Islamic law based on sources such
as:
 (a)Al-Qur'an (The Koran);

(b)Al-Sunnah (Prophetic traditions);

(c)Al-Qiyas (Analogy); and

(d)Al-Ijima (Consensus).

Section 24. Shari'ah Powers and Functions. - The powers and functions of the Shari'ah courts and the Shari'ah Public Assistance Office shall be defined by the Regional
Assembly subject to the provisions of the Constitution.

Villagracia vs. Fifth (5th) Shari'a District Court, G.R. No. 188832, April 23, 2014

REMEDIAL LAW; JURISDICTION; SHARI'A COURTS: Shari' a District Courts have no jurisdiction over real actions where one of the parties is not a
Muslim. All told, Shari’a District Courts have jurisdiction over a real action only when the parties involved are Muslims. Respondent Fifth Shari’a District
Court acted without jurisdiction in taking cognizance of Roldan E. Mala’s action for recovery of possession considering that Vivencio B. Villagracia is not
a Muslim. Accordingly, the proceedings in SDC Special Proceedings Case No. 07-200, including the judgment rendered, are void.

REMEDIAL LAW; JURISDICTION; CONFERRED BY LAW: Jurisdiction over the subject matter is "the power to hear and determine cases of the general
class to which the proceedings in question belong." This power is conferred by law, which may either be the Constitution or a statute. Since subject
matter jurisdiction is a matter of law, parties cannot choose, consent to, or agree as to what court or tribunal should decide their disputes. If a court
hears, tries, and decides an action in which it has no jurisdiction, all its proceedings, including the judgment rendered, are void.

REMEDIAL LAW; JURISDICTION; ALLEGATIONS IN THE COMPLAINT: To determine whether a court has jurisdiction over the subject matter of the
action, the material allegations of the complaint and the character of the relief sought are examined.

Shari'a District Courts Jurisdiction Over Real Actions

Roldan purchased a 300-square-meter parcel of land located in Shariff Kabunsuan, from one Ceres. Transfer Certificate of Title
covering the parcel of land was issued in Roldan’s name. Roldan had the parcel of land surveyed. In a report, the Geodetic Engineer
found that Vivencio occupied the parcel of land covered by Roldan’s certificate of title.
Failing to settle with Vivencio at the barangay level, Roldan filed an action to recover the possession of the parcel of land with
respondent Fifth Shari’a District Court alleging among others that he is a Filipino Muslim

Respondent court took cognizance of the case and caused service of summons on Vivencio. However, despite service of summons,
Vivencio failed to file his answer. Thus, Roldan moved that he be allowed to present evidence ex parte, which motion respondent
Fifth Shari’a District Court granted. In its decision, respondent Fifth Shari’a District Court ruled that Roldan, as registered owner, had
the better right to possess the parcel of land. Thereafter, it issued the notice of writ of execution to Vivencio.

Vivencio filed a petition for relief from judgment with prayer for issuance of writ of preliminary injunction. He argued that Shari’a
District Courts may only hear civil actions and proceedings if both parties are Muslims. Considering that he is a Christian, Vivencio
argued that respondent Fifth Shari’a District Court had no jurisdiction to take cognizance of Roldan’s action for recovery of
possession of a parcel of land. However, respondent court denied the petition.

ISSUE:

Does the Shari’a District Court has jusrisdiction over real action where one of the parties is not a muslim even if it decides the action
applying the provisions of the Civil Code?

RULING:

The Shari’a District Court has NO jurisdiction over real action where one of the parties is not a Muslim. Jurisdiction over the subject
matter is "the power to hear and determine cases of the general class to which the proceedings in question belong." This power is
conferred by law, which may either be the Constitution or a statute. Since subject matter jurisdiction is a matter of law, parties
cannot choose, consent to, or agree as to what court or tribunal should decide their disputes. If a court hears, tries, and decides an
action in which it has no jurisdiction, all its proceedings, including the judgment rendered, are void.

The law conferring the jurisdiction of Shari’a District Courts is the Code of the Muslim Personal Laws of the Philippines. Under Article
143 of the Muslim Code, Shari’a District Courts have concurrent original jurisdiction with "existing civil courts" over real actions not
arising from customary contracts wherein the parties involved are Muslims. However, this concurrent jurisdiction over real actions "is
applicable solely when both parties are Muslims". When one of the parties is not a Muslim, the action must be filed before the regular
courts.

Considering that Vivencio is not a Muslim, respondent Fifth Shari’a District Court had no jurisdiction over Roldan’s action for recovery
of possession of real property. The proceedings before it are void, regardless of the fact that it applied the provisions of the Civil
Code of the Philippines in resolving the action.

The application of the provisions of the Civil Code of the Philippines by respondent Fifth Shari’a District Court does not validate the
proceedings before the court. Under Article 175 of the Muslim Code, customary contracts are construed in accordance with Muslim
law. Hence, Shari’a District Courts apply Muslim law when resolving real actions arising from customary contracts.

In real actions not arising from contracts customary to Muslims, there is no reason for Shari’a District Courts to apply Muslim law. In
such real actions, Shari’a District Courts will necessarily apply the laws of general application, which in this case is the Civil Code of
the Philippines, regardless of the court taking cognizance of the action.