BIR Ruling [UN-013-94]

January 11, 1994 BIR RULING [UN-013-94] San Miguel Corporation 40 San Miguel Ave., Mandaluyong Metro Manila Attention: Mr . Leoncio S . Cao Asst . Vice-President Gentlemen : This refers to your letter dated December 24, 1993 stating that Magnolia Corporation (Magcorp) is a wholly-owned subsidiary of San Miguel Corporation (SMC); that it is engaged among others, in the manufacture of dairy products with principal office at Pasig, Metro Manila; that on December 24, 1993, Magcorp sold all its real properties (land) to Rizalag Land Company, Inc. and the documentary stamp taxes due thereon were paid on the same day at the BIR National Office in Quezon City; that the real properties sold are located in various parts of the country, viz: (1) Davao City, Cagayan de Oro City (2) Roxas City (3) Consolacion, Cebu and (4) Pavia, Iloilo; that the signatories to the aforesaid sales were all based in Metro Manila where the deeds were executed and it would be very difficult not to say physically impossible to pay the documentary stamp tax on the documents through each of the Revenue District Offices having jurisdiction over the localities where the real properties sold are located within 24 hours from the execution of the documents as prescribed in RMC Nos. 44-86 and 57-91. cdi In connection therewith, you are requesting for confirmation of your opinion that under the foregoing circumstances, Magcorp can pay documentary stamp taxes on the aforesaid sales of real properties at the BIR National Office, Quezon City, as an exceptional to RMC No. 44-86 and that the respective Revenue District Offices (RDO's) having jurisdiction over the cities of Davao, Cagayan de Oro and Roxas and the municipalities of Consolacion, Cebu and Pavia, Iloilo be required to issue the necessary Certificate Authorizing Registration (CAR) of the real properties covered by the aforesaid Deeds of Absolute Sale to enable the vendee thereof to register them in its name. In reply thereto, please be informed that the stamp tax on instrument of sale or conveyance of real property shall be paid through the Revenue District Office having jurisdiction over the locality where the real property sold/disposed is located (par. 3(3.1), RMC 44-86) Moreover, payment of the documentary stamp tax is effected by the purchase, affixture and subsequent cancellation of documentary stamps (or notation of payment of documentary stamp tax with denomination of P10.00 or more) on the documents at the time such act is done or transaction had, meaning on the date of execution or signing of the document by the parties thereto, and not at the time of its notarization (RMC 57-91). However, since as represented, the real properties of Magcorp sold to Rizalag Land Company, Inc. are located in various parts of the country, viz.: Davao City, Cagayan de Oro City, Roxas City, Consolacion, Cebu and Pavia, Iloilo, such that it would be very difficult not to say physically impossible to pay the documentary stamp tax on the documents through the respective RDO's having jurisdiction over the localities where the real properties sold are located within 24 hours from the execution of the documents, the validity of Magcorp's payment of documentary stamp taxes on the aforesaid sales of real property at the BIR National Office is hereby confirmed. Accordingly, the respective RDO's having jurisdiction over the cities of Davao, Cagayan de Oro and Roxas and the municipalities of Consolacion, Cebu and Pavia, Iloilo may now issue the necessary Certificate Authorizing Registration (CAR) of the real properties covered by the aforesaid Deeds of Absolute Sale to enable the vendee, Rizalag Land Company, Inc. to register the properties subject of the Deeds of Absolute Sale in its name. (BIR Ruling No. 04-92 dated January 7, 1992). Very truly yours, JAIME M. MAZA Assistant Commissioner (Legal Service)