BIR Ruling

February 24, 1975 San Miguel Corporation San Miguel Building 6766 Ayala Ave., Makati Rizal Attention: Mr . D . T . Reyes Vice-President Gentlemen : This refers to your letter dated February 20, 1975 requesting confirmation of your treatment of the land and building thereon (warehouse type) situated at J.P. Laurel and Bercaistegui streets in San Miguel, Manila, as capital asset. It appears that the property in question was originally a soft drinks plant and lastly utilized as storeroom for some of your offices. However, in 1964, when the main offices of the Company was transferred to Makati, the property was no longer used in your industrial and/or business activities, and you do not foresee any use for it in the future since you have started hasing out your manufacturing activities in the area. In reply, I have the honor to inform you that in a previous ruling with respect to your Echague Plant which you have abandoned after you transferred your plant site, this Office held that the Echague property became a capital asset since it ceased to be used in your trade or business, citing Steward Title Guaranty Co, 20 TC, 630; providence Coal Mining Co. v. Glenn, 39 AFTR, 219. casia As the property now in question falls exactly in the same situation as your Echague property, your treatment thereof in your books as capital asset is hereby confirmed. Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue TAN 1601-593-5