Republic v. Castro

[CA No. 29450-R. June 23, 1966.] REPUBLIC OF THE PHILIPPINES , plaintiff and appellee , vs . MARIA B. CASTRO , defendant and appellant . Rosendo J . Tansinsin for defendant and appellant. Solicitor General Arturo A . Alafriz, Assistant Solicitor General Jose P . Alejandro and Special Attorney Lolita O . Gal-lang for plaintiff and appellee. SYLLABUS 1. RELIEF FROM JUDGMENT; DISMISSAL OF APPEAL AND EXECUTION OF JUDGMENT; PETITION, TIME OF FILING; CASE AT BAR. A petition for relief may be availed of to obtain a revocation of an order dismissing an appeal due to the failure of the defeated party to perfect an appeal on time (Medran vs . Court of Appeals, 83 Phil. 164; Gibbs vs . Ocampo, 80 Phil. 160), and a writ of execution is an "order" or "proceeding" within the meaning of Section 2, Rule 38 of the Rules of Court (Aquino vs . Blanco, et al., 79 Phil. 647). Where, therefore, the orders dismissing the appeal were dated September 3 and 10, 1960, and the writ of execution was issued on December 12, 1960, but the petition for the setting aside of the orders and the suspension of the writ of execution was filed on Jan. 23, 1961, or after the lapse of more than a week from the time the movant came to know of the aforesaid orders and writ of execution, the said petition is well within the period provided for by Section 3, Rule 38 of the Rules of Court. 2. TAXES AND ASSESSMENTS; JURISDICTION; FAILURE TO APPEAL TO COURT OF TAX APPEALS; SEC. 7, REPUBLIC ACT 1125. The failure to appeal to the Court of Tax Appeals from an assessment made by the Commissioner of Internal Revenue makes the assessment final, executory and demandable, and the mere refusal to pay the tax due does not make the assessment a disputable one (Sec. 7, Republic Act 1125), consequently, the case for collection of the tax does not fall within the jurisdiction of the Court of Tax Appeals, but the regular courts. D E C I S I O N MARTIN , J p : On January 30, 1959, the plaintiff-appellee institutes in the Court of First Instance of Manila an action for the collection of deficiency income tax against the defendant-appellant. After due hearing, the trial court rendered a decision on July 23, 1960 the dispositive portion of which reads as follows: cdtech "Wherefore, judgment is hereby rendered ordering defendant to pay the plaintiff the amount of P31,957.20 as deficiency income tax for the year 1954, plus (5%) surcharge and (1%) monthly interest that have accrued thereon from June 29, 1956, to the date of the payment, and to pay the costs of the suit (R. A. pp. 1-2). On July 28, 1960, defendant-appellant, through her then attorney of record, Atty. Gregorio C. Centeno, received a copy of said decision and on August 29, 1960, filed a notice of appeal and an urgent motion for extension of time to file an appeal bond, alleging that since her time to appeal will expire on August 28, 1960, and August 28, 1960 happens to be Sunday, her last day to perfect her appeal would fall on the next day, August 29, 1960 (R. A. pp. 2-3). On the same date (August 29, 1960), the defendant-appellant filed a motion praying for the approval of a cash appeal bond and asking for fifteen (15) days within which to file a record on appeal (R. A. pp. 4-5). The notice of appeal and the motion for extension not having been filed on time, the trial court issued an order on September 3, 1960, which reads: "It appearing that the notice of appeal and urgent motion for extension to file appeal bond was denied for having been filed out time, the motion for approval of cash appeal bond and extension of time to file record on appeal filed by counsel for the defendant has become academic and no action should be taken thereon." (R. A. p. 6). Despite the above order of the court, the defendant-appellant filed on September 5, 1960 her record on appeal as well as a motion for the approval thereof. This was denied by the court on September 10, 1960 (R. A. p. 8). Thereafter, at the instance of the plaintiff-appellee, a writ of execution was issued by the lower court on December 12, 1960. On January 19, 1961, the defendant-appellant filed, through another counsel, Atty. Ricardo Tansinsin, an urgent motion for reconsideration and approval of her record on appeal and cash bond. In her motion, the defendant appellant alleged that she came to learn of the decision rendered in the above-entitled case having become final only from the sheriff who apprised her of the writ of execution. She alleged further that the delay of one day in filing the notice of appeal and motion for extension of time to file the record on appeal was due to the excusable mistake or negligence of her former lawyer, Atty. Centeno. To support this allegation, she attached to her motion an affidavit duly executed by Atty. Centeno (R. A. pp. 8-13). Then on January 23, 1961, the defendant-appellant filed a petition for relief under Rule 38 of the Rules of Court, praying that the orders of the court dated September 3, 1960 and September 10, 1960 be reconsidered and set aside; that, thereafter, the cash appeal bond and the record on appeal prayed for be approved and the records of the case elevated to the appellate court; and that the writ of execution issued on December 12, 1960, be suspended (R. A. pp. 13-21). Said petition was opposed by the plaintiff-appellee (R. A. pp. 21-26). On March 3, 1961 the trial court denied the petition for relief of January 23, 1961 (R. A. p. 27). From the order denying the petition for relief, the defendant-appellant appealed to this Court assigning as errors the following: 1. The lower court erred in not finding and declaring that defendant-appellant has a meritorious defense and that there was excusable mistake or negligence committed by the appellant's counsel in filing the notice of appeal and the motion for extension of time to file record on appeal one day after the expiration of the reglementary period for appeal. aisadc 2. The lower court erred in not granting the petition for relief which is supported by sufficient and legal grounds. The Government argued that the petition for relief filed on January 23, 1961 praying that the orders of the Court of September 3 and September 10, 1960 be reconsidered and set aside, was out of time, because it was not filed within 60 days after the defendant-appellant learned of the judgment rendered on July 28, 1960. There seems to be no merit in this argument. The petition for relief filed by the defendant-appellant seeks to set aside the orders of the lower court dated September 3 and 10, 1960 dismissing her appeal so that she can appeal from the judgment on the merits of the case. The petition for relief from said orders having been filed on January 23, 1961, or more than one (1) week after the defendant-appellant came to know of the order dismissing the appeal and the writ of execution, the same is well within the period provided for by law. Under Rule 38, Section 3 of the Rules of Court a petition for relief should be filed "within sixty (60) days after the petitioner learns of the judgment, order or other proceeding to be set aside, and not more than six (6) months after such judgment or order was entered or such proceeding was taken: . . ." It is well settled rule in this jurisdiction that a petition for relief may be availed of to obtain a revocation of an order dismissing an appeal due to the failure of the defeated party to perfect an appeal on time. ( Medran vs . Court of Appeals, 83 Phil ., 164; Gibbs vs . Ocampo, 80 Phil . , 160 ) and that a writ of execution is an "order" or "proceeding" within the meaning of Rule 38, Section 2. ( Aquino vs . Blanco , et al ., 74 Phil ., 647). When defendant-appellant, therefore, filed a petition for relief from the orders of the lower court dated September 3 and 10, 1960 and prayed for the suspension of the writ of execution issued by the said court on December 12, 1969, he was still within the reglementary period to file a petition for relief under Rule 38. The first error assigned boils down to two issues: (1) whether the defendant-appellant has a meritorious or substantial defense; and (2) whether there was excusable mistake or negligence committed by the former counsel of the defendant-appellant in filing the notice of appeal and the motion for extension of the time to file the record on appeal one day after the expiration of the reglementary period for appeal. Anent the first issue, the defendant-appellant wanted to raise on appeal the question of jurisdiction of the trial court to try a case for recovery of deficiency income tax (R. A. pp. 1-2). She contends that under Republic Act No. 1125, only the Court of Tax Appeals has exclusive appellate jurisdiction to review the decision of the Collector of Internal Revenue involving disputed assessments and other matters arising under the National Internal Revenue Code. But this contention is without merit. Obviously, the case of the defendant-appellant does not come within the purview of Section 7 of Republic Act No. 1125 which in part provides: SECTION 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; . . . (Sec. 7, Republic Act No. 1125). It does not appear in the record whether the defendant-appellant disputed the Collector's assessment by appealing the same to the Court of Tax Appeals. But it can be assumed that no appeal was ever taken because if there was any appeal from the Collector's assessment, the lawyer of the defendant-appellant would have called the attention of this Court in their memorandum filed on August 14, 1962. The failure of the defendant-appellant to appeal from the Collector's assessment makes the same final, executory and demandable. The mere refusal to pay the income tax due does not make the assessment a disputable one. Consequently the case does not fall within the jurisdiction of the Court of Tax Appeals. In a case where the Government brought in the Court of First Instance of Manila against respondents to collect from them a balance of P7,622.74 for 1946 deficiency income tax amounting to P14,097.54 due from the deceased and the Court of First Instance dismissed the case without prejudice because the case involved a disputed assessment made by the Collector of Internal Revenue and therefore comes within the jurisdiction of the Court of Tax Appeals, the Supreme Court ruled that: . . ."the case of the taxpayers herein does not come within Section 7 of Republic Act No. 1125, because they have not appealed from the assessment made by the Collector of Internal Revenue as provided for in Section 11 of the Act, and their failure to appeal from the assessment rendered it final, executory and demandable. Their refusal to pay the balance of the 1946 deficiency income tax due from their late father after paying partially does not render the assessment a disputable one." (Republic vs . del Rosario, et al., G. R. No. L-10460, March 11, 1959). As to the second issue, the defendant-appellant tried to plead the failure of her former counsel (Atty. Gregorio Centeno) in filing the notice of appeal and the motion for extension of time to file the record on appeal one day after the expiration of the reglementary period for appeal, as one of excusable negligence. The record shows that Atty. Centeno, then counsel of record for defendant-appellant, received a copy of the decision of the trial court on July 28, 1960; that on August 29, 1960, Atty. Centeno filed a notice of appeal and motion for extension to file an appeal bond and a record on appeal. The time within which to perfect her appeal from the decision expired on August 28, 1960. Since August 28 is a Sunday, the last day for perfecting the appeal would then fall on the next day, August 29, 1960. But the month of July has thirty-one (31) days, so counting the 30-day period from July 28, 1960, the period for appeal had expired on Saturday, August 27, 1960 and not on Sunday, August 28, 1960. In his affidavit which was made an integral part of the petition for relief, Atty. Centeno alleged that the delay of one day in the filing of the notice of appeal and the motion for extension of time within which to file an appeal bond and a record on appeal was due to his failure to realize the last day for appeal. He averred that when he received a copy of the decision of the lower court ordering the defendant-appellant to pay the deficiency income tax due, he was too busy handling numerous cases. So he instructed his assistant to prepare the notice of appeal and to prepare the record on appeal. As his assistant was also then pressed with the preparation of voluminous papers regarding legal and accounting matters, he overlooked the fact that the month of July has thirty-one days and therefore when he counted 30 days from July 28, 1960, he missed the 31st of July in the computation. Consequently his 30th day had to fall on Sunday, August 28, 1960, and because August 28, 1960 was a Sunday he thought he had still the next day, August 29, 1960 for perfecting the appeal which is wrong. The 30 days from July 28, 1960, fell on Saturday, August 27, 1960. It is evident that Atty. Centeno was guilty of negligence, which is inexcusable. In the case of Eco vs . Rodriguez, et al., G. R. No. L-16731, decided March 30, 1960, the Supreme Court held that the duty to compute the period to appeal is a duty that devolves upon the attorney and should not be delegated. It is unexcusable negligence, pure and simple, for an attorney to delegate it to someone else. As to the delay of one day in filing the notice of appeal and the motion for extension of time to file an appeal bond.