BIR Ruling [DA-179-03]

June 5, 2003 BIR RULING [DA-179-03] 24 (D) (1); DA-108-2003 National Housing Authority Quezon Memorial Elliptical Road Diliman, Quezon City Attention: Mr. Francisco V. Alican District Manager Gentlemen : This refers to your letter dated February 11, 2002 requesting for a reconsideration BIR Ruling No. DA-443-2000 dated December 29, 2000 imposing capital gains tax and documentary stamp tax on the exchange by Spouses Hilarion and Gregoria Palma of their 73.30 sq.m. lot located at Paco, Manila with the National Housing Authority's (NHA) two (2) parcels of land with a total area of 199.51-sq.m. located at Karangalan Village, Pasig City. As previously represented in BIR Ruling DA-443-2000, the property was owned by Spouses Palma and thereafter was acquired by NHA for the purpose of using it as access road right-of-way for the beneficiaries of the Peafrancia ZIP Project. TaCIDS In reply, please be informed that this Office has been consistent with its opinions that the sole basis for exemption from the payment of capital gains tax and documentary stamp tax are confined to the following conditions: First, there was a mistake in the construction of an improvement on the lot owned by another (having the same size and value and situated in the same barangay) or in the issuance of title; and second, that there was no monetary consideration involved in the transfer. Thus, this Office hereby denies your request for lack of legal basis. ( BIR Ruling No. DA-108-2003 dated April 4, 2003 ) Very truly yours, Commissioner of internal Revenue By: (SGD.) JOSE MARIO C. BUAG Deputy Commissioner Legal and Inspection Group