Guagua Electric Light Plant Company v. Revenue

J.P., J.:

Guagua Electric Light Plant Co. (hereinafter called Guagua Electric Company for short), a grantee of municipal franchise by the municipal council of Guagua, Pampanga under Resolution No. 42 dated December 13, 1927 and by the municipal council of Sexmoan, Pampanga under Resolution No. 48 dated November 15, 1928 pursuant to Act 667, as amended, realized and reported a gross income in the sum of P1,133,003.44 during the period from January 1, 1947 to November 1956 and paid thereon a franchise tax in the amount of P56,664.97 computed at 5% thereof in accordance with Section 259 of the National Internal Revenue Code. Believing that it should pay franchise tax at the lower rates provided for in its franchises1 instead of 5% fixed by Section 259 of the Tax Code, it filed on March 25, 1957 a claim for refund for allegedly overpaid franchise tax amounting to P35,593.98 on its gross receipts realized from January 1, 1947 to November 1956.

The Commissioner of Internal Revenue denied refund of franchise tax corresponding to the period prior to the fourth quarter of 1951 on the ground that the right to its refund had prescribed. 2 He however granted refund of the following amounts: Period Sum Refunded 4th quarter, 1951 to 3rd quarter, 1953 P7,482.17 1st quarter, 1955 to Sept. 1956 P8,232.39 Oct.

and Nov. 1956 879.31 TOTAL