City Assessor of Cebu v. Gaisano

[CBAA CASE NO. V-05. August 10, 1995.] In Re: LBAA Case # 306-329 TD# GR-06-038-01450 TD# 01472, Cebu City CITY ASSESSOR OF CEBU , respondent-appellant , vs. THE LOCAL BOARD OF ASSESSMENT APPEALS OF CEBU CITY , appellee , ALEXANDER S. GAISANO and STEPHEN S. GAISANO, JR., doing business under the name "GAISANO BROS., MERCHANDISING, INC." , petitioner-appellee . RESOLUTION This refers to the Motion for Reconsideration filed by Petitioners-Appellees, Alexander S. Gaisano and Stephen S. Gaisano, Jr., dated April 21, 1995, seeking to set aside the Decision of this Board dated November 15, 1994, the dispositive portion of which reads: "WHEREFORE, premises considered, the decision of Appellee Board, is hereby REVERSED. The assessments of Respondent-Appellant, City Assessor of Cebu City, on the aforestated lots with Alex S. Gaisano, et al. as "beneficial user" to take effect with the year 1988 and 1989, respectively is declared void. The order of the Appellee, Local Board of Assessment Appeals of Cebu City, as to the real property taxes paid to be tax credited to the future real property taxes due on the aforementioned lots is hereby revoked and modified, it appearing that under the present Section 253 of R.A. No. 7160, the same shall be treated in a separate cause of action under the jurisdiction of the Appellee Local Board of Assessment Appeals." In support of the aforesaid motion, Petitioners-Appellees argue: 1. That the contract to sell between the Public Estates Authority and Petitioners-Appellees was merely an option to buy and sell in the future, no beneficial use was granted; 2. That No. 5 of the terms and conditions of the Contract to Sell clearly indicates the intention of the parties that "Pending full payment of the purchase price of the Subject Property, the title and possession over the Subject Property shall be retained by the Owner"; 3. That there is no proof that the buyer was in possession of the property and that the mere execution of the said contract to sell does not give rise to the presumption that the beneficial use has been granted to the buyer; 4. That Article 1370 of the New Civil Code, which provides that " if the terms of a contract are clear and leave no doubt upon the intention of the contracting parties, the literal meaning of its stipulations shall control ," should apply; and 5. That Condition No. 4 of the Contract to Sell does not serve to defeat or efface the clear provisions of Condition No. 5 because Condition No. 4, by way of anticipation, merely provides the remedies in the event that there is default in payment of the purchase price. We find Petitioners-Appellees' Motion for Reconsideration to be without merit. The arguments presented by petitioners-appellees on reconsideration are not new. They were already considered and dealt with extensively in our decision (see pages 16-23 of the Decision). This Board now deems it unnecessary to delve further on the same. Our position on the matter remains unchanged. The Contract to Sell by and between the Public Estates Authority and Petitioners-Appellees clearly shows that the real properties embraced therein were sold in installment. A sale by installment, as in the instant case, from a government corporation so exempt by its charter to a taxable person is considered a grant (see Article III, par. A, of Assessment Regulations No. 3-75, dated February 10, 1975, of the Department of Finance, Rules and Regulations for the Implementation of the Assessment Provisions of the Real Property Tax Code, P.D. 464). Thus, Petitioners-Appellees cannot claim exemption under Section 40 (a) of P.D. 464 which reads: "(a) Real property owned by the Republic of the Philippines or any of its political subdivisions and any government-owned corporation so exempt by its charter: Provided, however, that this exemption shall not apply to real property of the above-named entities the beneficial use of which has been granted for consideration or otherwise, to a taxable person ." (underscoring supplied) WHEREFORE, finding no sufficient justification or cogent reason to disturb our earlier decision, the Motion for Reconsideration is hereby DENIED for lack of merit. SO ORDERED. Manila, Philippines, August 10, 1995. (SGD.) MARGARITA G. MAGISTRADO Chairman (SGD.) ELEANOR A. SANTOS Member VACANT Member