Revenue v. Filinvest Development Corporation

PEREZ, J.:

Assailed in these twin petitions for review on certiorari filed pursuant to Rule 45 of the 1997 Rules of Civil Procedure are the decisions rendered by the Court of Appeals (CA) in the following cases: (a) Decision dated 16 December 2003 of the then Special Fifth Division in CA-G.R. SP No. 72992;1 and, (b) Decision dated 26 January 2005 of the then Fourteenth Division in CA-G.R. SP No. 74510.2 The Facts The owner of 80% of the outstanding shares of respondent Filinvest Alabang, Inc. (FAI), respondent Filinvest Development Corporation (FDC) is a holding company which also owned 67.42% of the outstanding shares of Filinvest Land, Inc. (FLI). On 29 November 1996, FDC and FAI entered into a Deed of Exchange with FLI whereby the former both transferred in favor of the latter parcels of land appraised at ₱4,306,777,000.00. In exchange for said parcels which were intended to facilitate development of medium-rise residential and commercial buildings, 463,094,301 shares of stock of FLI were issued to FDC and FAI.3 As a result of the exchange, FLI's ownership structure was changed to the extent reflected in the following tabular précis, viz.: Stockholder Number and Percentage of Shares Held Prior to the Exchange Number of Additional Shares Issued Number and Percentage of Shares Held After the Exchange FDC 2,537,358,000 67.42% 42,217,000 2,579,575,000 61.03% FAI 0 0 420,877,000 420,877,000 9.96% OTHERS 1,226,177,000