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Caltex (Phil.) Inc. vs. Central Board of Assessment Appeals: - Second Division
Caltex (Phil.) Inc. vs. Central Board of Assessment Appeals: - Second Division
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No. L-50466. May 31, 1982.
297
CALTEX (PHILIPPINES) INC., petitioner, vs. CENTRAL
BOARD OF ASSESSMENT APPEALS and CITY
ASSESSOR OF PASAY, respondents.
VOL. 114, MAY 31, 1982 297
Taxation; Property; Courts; Jurisdiction; The Central Board Caltex (Phil.) Inc. vs. Central Board of Assessment Appeals
of Assessment Appeals, and not the Court of Tax Appeals has
appellate jurisdiction over decisions of the provincial or city
tures are necessary to the operation of the gas station, for without
boards of assessment appeals.—The Solicitor General’s contention
them the gas station would be useless, and which have been
that the Court of Tax Appeals has exclusive appellate jurisdiction
attached or affixed permanently to the gas station site or
over this case is not correct. When Republic Act No. 1125 created
embedded therein, are taxable improvements and machinery
the Tax Court in 1954, there was as yet no Central Board of
within the meaning of the Assessment Law and the Real Property
Assessment Appeals Section 7(3) of that law in providing that the
Tax Code.
Tax Court had jurisdiction to review by appeal decisions of
provincial or city boards of assessment appeals had in mind the
Same; Same; Gasoline station equipments and machineries
local boards of assessment appeals but not the Central Board of
are permanent fixtures for purposes of realty taxation.—Here, the
Assessment Appeals which under the Real Property Tax Code has
question is whether the gas station equipment and machinery
appellate jurisdiction over decisions of the said local boards of
permanently affixed by Caltex to its gas station and pavement
assessment appeals and is. therefore, in the same category as the
(which are indubitably taxable realty) should be subject to the
Tax Court.
realty tax. This question is different from the issue raised in the
Davao Saw Mill case. Improvements on land are commonly taxed
Same; Same; Same; Same; Supreme Court; Certiorari; The
as realty even though for some purposes they might be considered
Heal Property Tax Code does not provide for Supreme Court
personalty (84 C.J.S. 181-2, Notes 40 and 41). “It is a familiar
review of decisions of the Central Board of Assessment Appeals.
phenomenon to see things classed as real property for purposes of
The only remedy for Supreme Court review of the Central Board’s
taxation which on general principle might be considered personal
decision is by Special Civil Action of Certiorari.—Section 36 of the
property” (Standard Oil Co. of New York vs. Jaramillo, 44 Phil.
Real Property Tax Code provides that the decision of the Central
630, 633).
Board of Assessment Appeals shall become final and executory
after the lapse of fifteen days from the receipt of its decision by PETITION for certiorari to review the decision of the
the appellant. Within that fifteen-day period, a petition for Central Board of Assessment Appeals.
reconsideration may be filed. The Code does not provide for the
review of the Board’s decision by this Court. Consequently, the The facts are stated in the opinion of the Court.
only remedy available for seeking a review by this Court of the
decision of the Central Board of Assessment Appeals is the special AQUINO, J.:
civil action of certiorari, the recourse resorted to herein by Caltex
(Philippines), Inc. This case is about the realty tax on machinery and
equipment installed by Caltex (Philippines) Inc. in its gas
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stations located on leased land. “The underground gasoline tank is attached to the shed by the
The machines and equipment consists of underground steel pipe to the pump, so with the water tank it is connected also
tanks, elevated tank, elevated water tanks, water tanks, by a steel pipe to the pavement, then to the electric motor which
gasoline pumps, computing pumps, water pumps, car electric motor is placed under the shed. So to say that the gasoline
washer, car hoists, truck hoists, air compressors and pumps, water pumps and underground tanks are outside of the
tireflators. The city assessor described the said equipment service station, and to consider only the building as the service
and machinery in this manner: station is grossly erroneous.” (pp. 58-60, Rollo).
“A gasoline service station is a piece of lot where a building or The said machines and equipment are loaned by Caltex to
shed is erected, a water tank if there is any is placed in one corner gas station operators under an appropriate lease
of the lot, car hoists are placed in an adjacent shed, an air agreement or receipt. It is stipulated in the lease contract
compressor is attached in the wall of the shed or at the concrete that the operators, upon demand, shall return to Caltex the
wall fence. machines and equipment in good condition as when
“The controversial underground tank, depository of gasoline or received, ordinary wear and tear excepted.
crude oil, is dug deep about six feet more or less, a few meters The lessor of the land, where the gas station is located,
away does not become the owner of the machines and equipment
installed
298
299
On May 2, 1979 Caltex filed this certiorari petition “SEC. 38. Incidence of Real Property Tax.—There shall be levied,
wherein it prayed for the setting aside of the Board’s assessed and collected in all provinces, cities and municipalities
decision and for a declaration that the said machines and an annual ad valorem tax on real property, such as land,
equipment are personal property not subject to realty tax buildings, machinery and other improvements affixed or attached
(p. 16, Rollo). to real property not hereinafter specifically exempted.”
The Solicitor General’s contention that the Court of Tax
Appeals has exclusive appellate jurisdiction over this case The Code contains the following definitions in its section 3:
is not correct. When Republic act No. 1125 created the Tax
“k) Improvements—is a valuable addition made to property or an
Court in 1954, there was as yet no Central Board of
amelioration in its condition, amounting to more than mere
Assessment Appeals. Section 7(3) of that law in providing
repairs or replacement of waste, costing labor or capital and
that the Tax Court had jurisdiction to review by appeal
intended to enhance its value, beauty or utility or to adapt it for
decisions of provincial or city boards of assessment appeals
new or further purposes.”
had in mind the local boards of assessment appeals but not
“m) Machinery—shall embrace machines, mechanical
the Central Board of Assessment Appeals which under the
contrivances, instruments, appliances and apparatus attached to
Real Property Tax Code has appellate jurisdiction over
the
decisions of the said local boards of
301
300
land should be regarded as real property for purposes of Barredo (Chairman), Guerrero, De Castro and
execution of a judgment against the lessee. The sheriff Escolin, JJ., concur.
treated the machinery as personal property. This Court Concepcion Jr., and Abad Santos, JJ., did not take
sustained the sheriffs action. (Compare with Machinery & part.
Engineering Supplies, Inc. vs. Court of Appeals, 96 Phil.
70, where in a replevin case machinery was treated as Petition dismissed.
realty).
Here, the question is whether the gas station equipment Notes.—A tax assessment is deemed made when the
notice to that effect is released, mailed or sent to the
and machinery permanently affixed by Caltex to its gas
taxpayer for the purpose of giving effect to the assessment.
station and pavement (which are indubitably taxable
realty) should be subject to the realty tax. This quetion is (Republic vs. De la Rama, 18 SCRA 861.)
different from the issue raised in the Davao Saw Mill case. 303
Improvements on land are commonly taxed as realty
even though for some purposes they might be considered
personalty VOL. 114, MAY 31, 1982 303
Caltex (Phil.) Inc. vs. Central Board of Assessment Appeals
302
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304
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