CITY OF CABANATUAN ET AL., PETITIONERS, VS. THE HON. MAGNO S. GATMAITAN, ET AL., RESPONDENTS.

This is a petition for certiorari with injunction filed by the City of
Cabanatuan, et al. seeking to annul the order of respondent judge dated
September 2,1961 denying their motion to quash the writ of execution issued in
Civil Case No. 44646 of the Court of First Instance of Manila on the ground that
the same was issued in excess of his jurisdiction. The Court issued the writ
prayed for upon petitioners’ filing a bond in the amount of P1.000.00.

The Manila Railroad Company is a government-owned and controlled corporation
duly organized under Act No. 1510 and Executive Order No. 399, known as the
“Uniform Charter for Government Corporations.” Since 1907, said company has been
engaged in operating a railroad transportation business and for that purpose it
acquired several parcels of land located in Cabanatuan City and covered by
O.C.T. Nos. 181, 1878, 615 and 605.

The City of Cabanatuan revised the assessment of said lots in 1948, and again
in 1956, and assessed thereon the amount of P41,806.68 as real estate taxes,
including penalties, allegedly due for the years 1945 to 1949. Because of a
demand made by the City of Cabanatuan that said taxes be paid as otherwise the
lots would be forfeited, the company paid under protest the aforesaid amount on
November 27, 1959. Basis of the protest is the company’s claim that it is exempt
from the payment of real estate taxes under the provisions of Section 1(12) of
its charter, Act No. 1510. Whereupon, the company filed on November 7, 1960 a
complaint before the Court of First Instance of Manila seeking to recover the
taxes it had paid under protest on the ground that their assessment and
collection were unwarranted and illegal.

The City of Cabanatuan set up as a defense that the parcels of land on which
the taxes in question were assessed and collected are not exempt from taxation
under the provisions of the company’s charter because the same are not devoted
for the purposes of its transportation business but for uses not contemplated
within its charter in line with an opinion rendered by Secretary of Justice
Pedro Tuason.

The case having been submitted on a stipulation of facts, the court a quo
on January 27, 1961 rendered judgment holding that the claim for exemption
of the company is in accordance with law and as a consequence it ordered the
City of Cabanatuan to refund to it the sum of P41,806.68, with legal interest
thereon from November 27, 1959, plus costs.

This decision having become final, the court a quo in due course
issued the corresponding writ of execution. Thereupon, the City of Cabanatuan
filed a motion to quash raising for the first time the issue that the court a
quo had no jurisdiction to act on the case it involving the correctness of a
tax assessment which comes under the competence of the Court of Tax Appeals.
When this motion was denied, the City of Cabanatuan interposed the present
petition for certiorari.

Petitioner contends that the action taken by respondent company is in the
form of an appeal from the assessment made by the City of Cabanatuan on some
properties of said respondent for purposes of real estate tax which was
erroneously brought before the court of first instance, and under Section 7,
paragraph 5, Republic Act 1125 the proper court to which said appeal should be
taken is the Court of Tax Appeals and not the Court of First Instance of Manila.
And this is so because, petitioner contends, the Court of Tax Appeals has
exclusive appellate jurisdiction to review on appeal decisions of Provincial or
City Boards of Assessment Appeals in cases involving the assessment and taxation
of real property or other matters arising under the Assessment Law, including
rules and regulations relative thereto, which shows that what respondent should
have done was to appeal from the assessment made by the corresponding city
officials to the City Board of Assessment Appeals and in case of Adverse
decision to appeal to the Court of Tax Appeals as provided for in Republic Act
1125.

Section 7 of Republic Act 1125, invoked by petitioner, provides:

“Sec. 7. Jurisdiction. – The Court of Tax Appeals shall exercise
exclusive appellate jurisdiction to review by appeal, as herein provided—

(1) Decisions of the Collector 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;

(2) 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; and

(3) Decisions of provincial or city Boards of Assessment Appeals in cases
involving the assessment and taxation of real property or other matters arising
under the Assessment Law, including rules and regulations relative
thereto.”

It would appear that the Court of Tax Appeals is given exclusive appellate
jurisdiction to review by appeal (1) decisions of the Collector of Internal
Revenue in cases involving disputed assessments, refunds of internal
revenue taxes, or other matters arising under the National Internal Revenue
Code; (2) decisions of the Commissioner of Customs in cases involving liability
for customs duties or other matters arising under the Customs Law; and (3)
decisions of Provincial or City Boards of Assessment Appeals in cases involving
the assessment and taxation of real property or other matters arising under the
Assessment Law. If the case involves a matter which is not enumerated or
contemplated in the provision above-quoted, it is not appealable to the Court of
Tax Appeals. It comes under the jurisdiction of the court of first instance.

The instant case involves the refund of certain real estate tax assessed and
collected by the treasurer of the City of Cabanatuan by virtue of an assessment
made under the Assessment Law. It does not involve the refund of an internal
revenue tax or of a matter that arises under the National Internal Revenue Code.
Since the law only allows the refund of an internal revenue tax, or any other
matter arising under the National Internal Revenue Code in order that it may
come under the appellate jurisdiction of the Court of Tax Appeals, we have
necessarily to exclude from its jurisdiction the refund of customs duties or
real estate taxes that come under the Customs Law or Assessment Law under the
principle of exclusio unius est exclusio alterius.

It is true that when the assessment of the real estate tax in question was
made by the City of Cabanatuan respondent company could have appealed from the
assessment to the City Board of Assessment Appeals as provided for in Republic
Act 1125. But the company found no other alternative than to pay considering
that the City of Cabanatuan pressed the payment of the tax with the warning that
if it fails to do so it would forfeit its properties to the city. As a result,
the company paid the tax under protest and forthwith brought the instant action
for its refund. Moreover, if the real estate tax has already been paid it is
futile for a taxpayer to take the matter to the City Board of Assessment Appeals
for the jurisdiction of that body is merely confined to the determination of the
reasonableness of the assessment or taxation of the property and is not extended
to the authority of requiring the refund of the tax unlike cases involving
assessment of internal revenue taxes. In the circumstances, we hold that this
case comes under the jurisdiction of the proper court of first instance it
involving the refund of a real estate tax which does not come under the
appellate jurisdiction of the Court of Tax Appeals.

Wherefore, petition is dismissed. The decision of the court a quo is
affirmed. The writ of injunction issued by this Court is hereby dissolved. No
costs.

Bengzon, C. J., Padilla, Labrador, Concepcion, Reyes, J. B. L., Barrera,
Paredes, Dizon, Regala, and Makalintal, JJ., concur.