CAMPOS RUEDA Y CIA., S. EN C, PLAINTIFF AND APPELLEE, VS. WENCESLAO TRINIDAD, COLLECTOR OF INTERNAL REVENUE, DEFENDANT AND APPELLANT.

The only question presented by this appeal is
whether the plaintiff is, or acted as, a commission merchant in the
transactions involved in the present case.

That question was presented to the lower court and decided by the Honorable Simplicio del Rosario, judge, in the negative.

There is no question about the facts. They are simple and may be stated as follows:

Some time prior to the commencement of the present action the
plaintiff granted a credit of P15,000 to one Manuel Bahamonde for the
purchase of copra. The plaintiff’s office was in the city of Manila.
Manuel Bahamonde was to purchase the copra in the provinces. Manuel
Bahamonde purchased the copra and sold the same to various persons in
the city of Manila. At the time the said credit was granted to Manuel
Bahamonde by the plaintiff, it was agreed that when the copra was sold
the plaintiff was to inspect the weighing of the same and collect the
price therefor, for the purpose of guaranteeing, or securing the
payment of, the said credit of P15,000, for which services the
plaintiff received from Manuel Bahamonde a certain amount stipulated in
their contract. The only connection which the plaintiff had with the
purchase and sale of the copra in question was to see that it was
properly weighed and the price therefor collected. The various
purchases and sales made by the said Manuel Bahamonde covered the year,
or practically all of the year, 1918. The defendant, as Collector of
Internal Revenue, insisted that the plaintiff was a commission merchant
and collected from him, under protest, the sum of P640.38. The present
action is brought to recover that sum with costs.

The defendant collected the tax in question by virtue of the
provisions of section 1459 of Act No. 2711, which provides among other
things that “all merchants, not herein specifically exempted, shall pay
a tax of one per centum on the gross value in money of the commodities,
goods, wares and merchandise sold, bartered, exchanged, or consigned abroad by
them. * * *” In the present case the plaintiff neither sold, bartered,
exchanged, nor consigned abroad the copra in question. The copra was
purchased by Manuel Bahamonde and sold by him. The only intervention
which the plaintiff tad in the transaction was the inspection of the
weighing of the same and the collection of the price therefor. Whatever
the plaintiff did in the weighing and in the collection of the price
was done simply to secure the payment of the credit of P15,000 granted
by him to the said Manuel Bahamonde. The plaintiff neither acted as a
merchant nor as a commission merchant in any way in the transactions.
Therefore the tax was illegally collected. It was paid under protest.
Plaintiff, therefore, is entitled to recover the same with costs.

Wherefore, the judgment appealed from is hereby affirmed, with costs. So ordered.

Araullo, C. J., Street, Avancena, Villamor, and Romualdez, JJ., concur.