Decision

Docks v. Revenue

G.R. No. 32366 · 1930-03-27 · LawPhil

THE EARNSHAWS DOCKS and HONOLULU IRON WORKS, plaintiff-appellant, vs. THE COLLECTOR OF INTERNAL REVENUE, defendant-appellee. DeWitt, Perkins and Brady for appellant. Attorney-General Jaranilla for appelle. STATEMENT Plaintiff is a domestic corporation, with it's principal office and place of…

Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. L-32366 March 27, 1930 THE EARNSHAWS DOCKS and HONOLULU IRON WORKS, plaintiff-appellant, vs. THE COLLECTOR OF INTERNAL REVENUE, defendant-appellee. DeWitt, Perkins and Brady for appellant. Attorney-General Jaranilla for appelle.

STATEMENT Plaintiff is a domestic corporation, with it's principal office and place of business in the City of Manila, and the defendant is the Collector of Internal Revenue. Plaintiff alleges that during the years 1926 and 1927 it sold in the United States, in the City of New York, certain machineries and materials to different corporations amounting in the aggregate to P191,161.08. Then follows a statement as to whom the property was sold and the amount of the sales.

It is then alleged that the defendant, claiming that the sales were made by the plaintiff in the Philippine Islands, and pretending to act under sections 1458 and 1459 of the Administrative Code, the first as amended by section 2 of Act No. 2892 and section 1 of Act No. 3074, and the second as it relates to Act No. 3243, levied and assessed, and demanded the payment from the plaintiff, as a merchant's sale's tax and surcharge on the amount of such sales, for the 1 1/2 per cent tax amounting to P2,867.42, and the 25 per cent surcharge amounting to P716.86. The October 4, 1928, and to avoid distraint of its good in the payment of further fines and penalties, the plaintiff, under a written protest the such tax was illegal, paid the defendant the amount of P3,584.28. That on October 9, 1928, the defendant overruled plaintiff's protest and refused to refund the money.

For a second cause of action the plaintiff alleges that an and between May 31, 1927, and September 30, 1928, it sold in the same City of New York, and the City of Honolulu, Territory of Hawaii, machineries and materials amounting to P83,506.31. Then follows a list of the persons to whom the property was sold and the amount of sales. That on October 23, 1928, plaintiff was required to pay, and under protest did pay, taxes thereon amounting to P1,565.74.

That of the amount P1,252.59 was for 1 1/2 per cent sales tax, upon which P313.15 was the 25 per cent surcharge. That the defendant overruled plaintiff's protest and refused to refund this money, and it prays for judgment for both of said amounts, with interest and costs. For answer the defendant admits the allegations of paragraphs 1, 3, 4, 5, 6, 8 and 9, and denies the allegations made in paragraphs 2 and 7, of the complaint, and as a special defense alleges that all of the sales mentioned in the complaint were made in the Philippine Islands, and that the taxes thereon were collected in accordance with law, and prays that the plaintiff's complaint be dismissed, with costs.

The case was tried and submitted on an agreed statement of facts, the material portions of which are as follows: I. That the plaintiff is and was, during all the times hereinafter mentioned, a corporation duly organized and existing under and in virtue of the laws of the Philippine Islands, with its principal place of business in the City of Manila, Philippine Islands, and also a manufacturer and merchant doing business in the Philippine Islands; and that the defendant is the Collector of Internal Revenue of the Philippine Islands. II. That on October 4th, 1928, this plaintiff, pursuant to a previous demand made by the Collector of Internal Revenue, involuntarily, under duress and written protest, and for the sole purpose of avoiding penalties and distraint, paid the defendant the sum of P3,584.28, as merchant's sales tax of 1 1/2 per cent and 25 per cent surcharge incident to late payment thereof alleged to be due on the transactions describe in the subsequent paragraphs under this first cause of action.

A true copy of said written protest, marked Exhibit A, is hereunto annexed and hereby made a part hereof. x x x x x x x x x IV.

That the tax so demanded by the defendant, and paid by the plaintiff under protest, consisted of the 1 ½ per cent sales tax amounting to P2,867.42, and 25 per cent surcharge thereon amounting to P716.88, on orders for machinery and materials received and accepted by the plaintiff in the Philippine Islands during the years 1926 and 1927, aggregating P191,161.08, and made up as follows: 1926 Compania General de Tabacos de Filipinas . . .

. . .

. P17,168.00 Cebu Portland Cement Co . .

. . .

4,130.76 Do . . .

. . .

. . 15,123.72 Pampanga Sugar Mills .

. . .

. 82,407.64 Do . .

. . .

54,800.00 1927 Beguet Consolidated Mining Co . . .

. . .

2,338.96 Cebu Portland Cement Co . . .

. . .

. . 10,000.00 Benguet Consolidated Mining Co .

. . .

5,192.00 Total . . .

. . .