Nursery Care Corporation vs. Acevedo

2/22/2019 SUPREME COURT REPORTS ANNOTATED VOLUME 731
G.R. No. 180651. July 30, 2014.*

NURSERY CARE CORPORATION; SHOEMART, INC.;
STAR APPLIANCE CENTER, INC.; H&B, INC.;
SUPPLIES STATION, INC.; and HARDWARE
WORKSHOP, INC., petitioners, vs. ANTHONY
ACEVEDO, in his capacity as THE TREASURER OF
MANILA; and THE CITY OF MANILA, respondents.
Remedial Law; Civil Procedure; Appeals; Modes of Appeal

from the Decisions and Final Orders of the Regional Trial Court
(RTC).—The Rules of Court provides three modes of appeal from
the decisions and final orders of the RTC, namely: (1) ordinary
appeal or appeal by writ of error under Rule 41, where the
decisions and final orders were rendered in civil or criminal
actions by the RTC in the exercise of original jurisdiction; (2)
petition for review under Rule 42, where the decisions and final
orders were rendered by the RTC in the exercise of appellate
jurisdiction; and (3) petition for review on certiorari to the
Supreme Court under Rule 45. The first mode of appeal is taken
to the CA on questions of fact, or mixed questions of fact and law.
The second mode of appeal is brought to the CA on questions of
fact, of law, or mixed questions of fact and law. The third mode of
appeal is elevated to the Supreme Court only on questions of law.
Same; “Questions of Law” and “Questions of Fact,”
Distinguished.—The distinction between a question of law and a
question of fact is well-established. On the one hand, a question of
law arises when there is doubt as to what the law is on a certain
state of facts; on the other, there is a question of fact when the
doubt arises as to the truth or falsity of the alleged facts.
According to Leoncio v. De Vera, 546 SCRA 180 (2008): x x x For a
question to be one of law, the same must not involve an
examination of the probative value of the evidence presented by
the litigants or any of them. The resolution of the issue must rest
solely on what the law provides on the given set of circumstances.
Once it is clear that the issue invites a review of the evidence
presented, the question posed is one of fact. Thus, the test of
whether a question is one of law or of fact is not the appella-
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* FIRST DIVISION.
http://www.central.com.ph/sfsreader/session/00000169151be85c03f3fa0b003600fb002c009e/t/?o=False 1/18
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Nursery Care Corporation vs. Acevedo
tion given to such question by the party raising the same; rather,
it is whether the appellate court can determine the issue raised
without reviewing or evaluating the evidence, in which case, it is
a question of law; otherwise it is a question of fact.
Taxation; Double Taxation; On the basis of the rulings in City
of Manila v. Coca-Cola Bottlers Philippines, Inc., 595 SCRA 299
(2009) and Swedish Match Philippines, Inc. v. The Treasurer of
the City of Manila, 700 SCRA 428 (2013), the Court now holds
that all the elements of double taxation concurred upon the City of
Manila’s assessment on and collection from the petitioners of taxes
for the first quarter of 1999 pursuant to Section 21 of the Revenue
Code of Manila.—On the basis of the rulings in City of Manila v.
Coca-Cola Bottlers Philippines, Inc., 595 SCRA 299 (2009) and
Swedish Match Philippines, Inc. v. The Treasurer of the City of
Manila, 700 SCRA 428 (2013), the Court now holds that all the
elements of double taxation concurred upon the City of Manila’s
assessment on and collection from the petitioners of taxes for the
first quarter of 1999 pursuant to Section 21 of the Revenue Code
of Manila. Firstly, because Section 21 of the Revenue Code of
Manila imposed the tax on a person who sold goods and services
in the course of trade or business based on a certain percentage of
his gross sales or receipts in the preceding calendar year, while
Section 15 and Section 17 likewise imposed the tax on a person
who sold goods and services in the course of trade or business but
only identified such person with particularity, namely, the
wholesaler, distributor or dealer (Section 15), and the retailer
(Section 17), all the taxes — being imposed on the privilege of
doing business in the City of Manila in order to make the
taxpayers contribute to the city’s revenues — were imposed on the
same subject matter and for the same purpose. Secondly, the
taxes were imposed by the same taxing authority (the City of
Manila) and within the same jurisdiction in the same taxing
period (i.e., per calendar year). Thirdly, the taxes were all in the
nature of local business taxes.
PETITION for review on certiorari of the resolutions of

the Court of Appeals.
The facts are stated in the opinion of the Court.
Chato & Vinzons-Chato for petitioners.
282
282 SUPREME COURT REPORTS ANNOTATED

Office of the City Legal Officer for respondent.
BERSAMIN, J.:
The issue here concerns double taxation. There is double
taxation when the same taxpayer is taxed twice when he
should be taxed only once for the same purpose by the same
taxing authority within the same jurisdiction during the
same taxing period, and the taxes are of the same kind or
character. Double taxation is obnoxious.
The Case
Under review are the resolution promulgated in C.A.-
G.R. S.P. No. 72191 on June 18, 2007,[1] whereby the Court
of Appeals (CA) denied petitioners’ appeal for lack of
jurisdiction; and the resolution promulgated on November
14, 2007,[2] whereby the CA denied their motion for
reconsideration for its lack of merit.
Antecedents
The City of Manila assessed and collected taxes from the
individual petitioners pursuant to Section 15 (Tax on
Wholesalers, Distributors, or Dealers) and Section 17 (Tax
on Retailers) of the Revenue Code of Manila.[3] At the same
time, the City of Manila imposed additional taxes upon the
petitioners pursuant to Section 21 of the Revenue Code of
Manila,[4] as amended, as a condition for the renewal of
their respective
_______________
[1] Rollo, pp. 74-78; penned by Associate Justice Josefina Guevarra-
Salonga, with Associate Justices Vicente Q. Roxas and Ramon R. Garcia,
concurring.
[2] Id., at pp. 80-81.
[3] Id., at p. 19.
[4] Id., at pp. 82, 86.
283
VOL. 731, JULY 30, 2014 283

business licenses for the year 1999. Section 21 of the

Revenue Code of Manila stated:
Section 21. Tax on Business Subject to the Excise, Value-

Added or Percentage Taxes under the NIRC.—On any of the
following businesses and articles of commerce subject to the

excise, value-added or percentage taxes under the National
Internal Revenue Code, hereinafter referred to as NIRC, as
amended, a tax of FIFTY PERCENT (50%) OF ONE PERCENT
(1%) per annum on the gross sales or receipts of the preceding
calendar year is hereby imposed:
A) On person who sells goods and services in the course of
trade or businesses; x x x
PROVIDED, that all registered businesses in the City of
Manila already paying the aforementioned tax shall be exempted
from payment thereof.
To comply with the City of Manila’s assessment of taxes

under Section 21, supra, the petitioners paid under protest
the following amounts corresponding to the first quarter of
1999,[5] to wit:
By letter dated March 1, 1999, the petitioners formally

requested the Office of the City Treasurer for the tax credit
or refund of the local business taxes paid under protest.[6]
How-
_______________
[5] Id., at pp. 84, 98.
[6] Id., at pp. 86-88.
284

ever, then City Treasurer Anthony Acevedo (Acevedo)

denied the request through his letter of March 10, 1999.[7]
On April 8, 1999, the petitioners, through their
representative, Cecilia R. Patricio, sought the
reconsideration of the denial of their request.[8] Still, the
City Treasurer did not reconsider.[9]
In the meanwhile, Liberty Toledo succeeded Acevedo as
the City Treasurer of Manila.[10]
On April 29, 1999, the petitioners filed their respective
petitions for certiorari in the Regional Trial Court (RTC) in
Manila. The petitions, docketed as Civil Cases Nos. 99-
93668 to 99-93673,[11] were initially raffled to different
branches, but were soon consolidated in Branch 34.[12]

After the presiding judge of Branch 34 voluntarily inhibited
himself, the consolidated cases were transferred to Branch
23,[13] but were again re-raffled to Branch 19 upon the
designation of Branch 23 as a special drugs court.[14]
The parties agreed on and jointly submitted the
following issues for the consideration and resolution of the
RTC, namely:
(a) Whether or not the collection of taxes under Section 21 of

Ordinance No. 7794, as amended, constitutes double taxation.
(b) Whether or not the failure of the petitioners to avail of
the statutorily provided remedy for their tax protest on
the ground of unconstitutionality, il-
_______________
[7] Id., at pp. 90-92.
[8] Id., at pp. 93-98.
[9] Id., at p. 99.
[10] Id., at p. 333.
[11] Id., at pp. 100-241.
[12] Id., at p. 255.
[13] Id., at pp. 26, 266.
[14] Id., at p. 24.
285
VOL. 731, JULY 30, 2014 285

legality and oppressiveness under Section 187 of the Local

Government Code renders the present action dismissible
for non-exhaustion of administrative remedy.[15]
Decision of the RTC

On April 26, 2002, the RTC rendered its decision,
holding thusly:
The Court perceives of no instance of the constitutionally

proscribed double taxation, in the strict, narrow or obnoxious
sense, imposed upon the petitioners under Sections 15 and 17, on
the one hand, and under Section 21, on the other, of the
questioned Ordinance. The tax imposed under Sections 15 and 17,
as against that imposed under Section 21, are levied against
different tax objects or subject matter. The tax under Section 15 is
imposed upon wholesalers, distributors or dealers, while that
under Section 17 is imposed upon retailers. In short, taxes
imposed under Sections 15 and 17 is a tax on the business of

wholesalers, distributors, dealers and retailers. On the other
hand, the tax imposed upon herein petitioners under Section 21 is
not a tax against the business of the petitioners (as wholesalers,
distributors, dealers or retailers) but is rather a tax against
consumers or end-users of the articles sold by petitioners. This is
plain from a reading of the modifying paragraph of Section 21
which says:
“The tax shall be payable by the person paying for the
services rendered and shall be paid to the person rendering the
services who is required to collect and pay the tax within twenty
(20) days after the end of each quarter.” (Underscoring supplied)
In effect, the petitioners only act as the collection or
withholding agent of the City while the ones actually
_______________
[15] Id., at p. 333.
286

paying the tax are the consumers or end-users of the articles

being sold by petitioners. The taxes imposed under Sec. 21
represent additional amounts added by the business
establishment to the basic prices of its goods and services which
are paid by the end-users to the businesses. It is actually not
taxes on the business of petitioners but on the consumers. Hence,
there is no double taxation in the narrow, strict or obnoxious
sense, involved in the imposition of taxes by the City of Manila
under Sections 15, 17 and 21 of the questioned Ordinance. This in
effect resolves in favor of the constitutionality of the assailed
sections of Ordinance No. 7807 of the City of Manila.
Petitioners, likewise, pray the Court to direct respondents to
cease and desist from implementing Section 21 of the questioned
Ordinance. That the Court cannot do, without doing away with
the mandatory provisions of Section 187 of the Local Government
Code which distinctly commands that an appeal questioning the
constitutionality or legality of a tax ordinance shall not have the
effect of suspending the effectivity of the ordinance and the
accrual and payment of the tax, fee or charge levied therein. This
is so because an ordinance carries with it the presumption of
validity.
xxx
With the foregoing findings, petitioners’ prayer for the refund
of the amounts paid by them under protest must, likewise, fail.
Wherefore, the petitions are dismissed. Without

pronouncement as to costs.
SO ORDERED.[16]
The petitioners appealed to the CA.[17]

_______________
[16] Id., at pp. 335-337.
[17] Id., at pp. 418-419.
287
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Ruling of the CA
On June 18, 2007, the CA denied the petitioners’ appeal,
ruling as follows:
The six (6) cases were consolidated on a common question of

fact and law, that is, whether the act of the City Treasurer of
Manila of assessing and collecting business taxes under Section
21 of Ordinance 7807, on top of other business taxes also assessed
and collected under the previous sections of the same ordinance is
a violation of the provisions of Section 143 of the Local
Government Code.
Clearly, the disposition of the present appeal in these
consolidated cases does not necessitate the calibration of the
whole evidence as there is no question or doubt as to the truth or
the falsehood of the facts obtaining herein, as both parties agree
thereon. The present case involves a question of law that would
not lend itself to an examination or evaluation by this Court of the
probative value of the evidence presented.
Thus the Court is constrained to dismiss the instant petition
for lack of jurisdiction under Section 2, Rule 50 of the 1997 Rules
on Civil Procedure which states:
Sec. 2. Dismissal of improper appeal to the Court of
Appeals.—An appeal under Rule 41 taken from the Regional Trial
Court to the Court of Appeals raising only questions of law shall
be dismissed, issues purely of law not being reviewable by said
court. Similarly, an appeal by notice of appeal instead of by
petition for review from the appellate judgment of a Regional
Trial Court shall be dismissed.
An appeal erroneously taken to the Court of Appeals shall
not be transferred to the appropriate court but shall be dismissed
outright.
288

WHEREFORE, the foregoing considered, the appeal is

DISMISSED.
SO ORDERED.[18]
The petitioners moved for reconsideration, but the

CA denied their motion through the resolution
promulgated on November 14, 2007.[19]
Issues
The petitioners now appeal, raising the following
grounds, to wit:
A.
THE COURT OF APPEALS, IN DISMISSING THE APPEAL
OF THE PETITIONERS AND DENYING THEIR MOTION FOR
RECONSIDERATION, ERRED IN RULING THAT THE ISSUE
INVOLVED IS A PURELY LEGAL QUESTION.
B.
THE COURT OF APPEALS ERRED IN NOT REVERSING
THE DECISION OF BRANCH 19 OF THE REGIONAL TRIAL
COURT OF MANILA DATED 26 APRIL 2002 DENYING
PETITIONERS’ PRAYER FOR REFUND OF THE AMOUNTS
PAID BY THEM UNDER PROTEST AND DISMISSING THE
PETITION FOR CERTIORARI FILED BY THE PETITIONERS.
C.
THE COURT OF APPEALS ERRED IN NOT RULING THAT
THE ACT OF THE CITY TREASURER OF MANILA IN
IMPOSING, ASSESSING AND COLLECTING THE
ADDITIONAL BUSINESS TAX UNDER SECTION 21 OF
ORDINANCE NO. 7794, AS AMENDED BY ORDINANCE NO.
7807, ALSO KNOWN AS THE REVE-
_______________
[18] Id., at pp. 77-78.
[19] Id., at p. 81.
289
VOL. 731, JULY 30, 2014 289

NUE CODE OF THE CITY OF MANILA, IS CONSTITUTIVE OF

DOUBLE TAXATION AND VIOLATIVE OF THE LOCAL
GOVERNMENT CODE OF 1991.[20]
The main issues for resolution are, therefore, (1)

whether or not the CA properly denied due course to the
appeal for raising pure questions of law; and (2) whether or
not the petitioners were entitled to the tax credit or tax
refund for the taxes paid under Section 21, supra.
Ruling
The appeal is meritorious.
1.
The CA did not err in dismissing the appeal;
but the rules should be liberally applied
for the sake of justice and equity
The Rules of Court provides three modes of appeal from
the decisions and final orders of the RTC, namely: (1)
ordinary appeal or appeal by writ of error under Rule 41,
where the decisions and final orders were rendered in civil
or criminal actions by the RTC in the exercise of original
jurisdiction; (2) petition for review under Rule 42, where
the decisions and final orders were rendered by the RTC in
the exercise of appellate jurisdiction; and (3) petition for
review on certiorari to the Supreme Court under Rule 45.
[21] The first mode of appeal is taken to the CA on
questions of fact, or mixed questions of fact and law. The
second mode of appeal is brought to the CA on questions of
fact, of law, or mixed questions of fact and
_______________
[20] Id., at p. 27.
[21] RULES OF COURT, Section 2, Rule 41 (1997).
290

law.[22] The third mode of appeal is elevated to the

Supreme Court only on questions of law.[23]
The distinction between a question of law and a question
of fact is well-established. On the one hand, a question of
law arises when there is doubt as to what the law is on a
certain state of facts; on the other, there is a question of
fact when the doubt arises as to the truth or falsity of the
alleged facts.[24] According to Leoncio v. De Vera:[25]
x x x For a question to be one of law, the same must not involve

an examination of the probative value of the evidence presented
by the litigants or any of them. The resolution of the issue must
rest solely on what the law provides on the given set of
circumstances. Once it is clear that the issue invites a review of

the evidence presented, the question posed is one of fact. Thus,
the test of whether a question is one of law or of fact is not the
appellation given to such question by the party raising the same;
rather, it is whether the appellate court can determine the issue
raised without reviewing or evaluating the evidence, in which
case, it is a question of law; otherwise it is a question of fact.[26]
_______________
[22] RULES OF COURT, Section 2, Rule 42 (1997).
[23] RULES OF COURT, Section 1, Rule 45 (1997); Republic v. Malabanan,
G.R. No. 169067, October 6, 2010, 632 SCRA 338, 344-345.
[24] Latorre v. Latorre, G.R. No. 183926, March 29, 2010, 617 SCRA 88,
99.
[25] G.R. No. 176842, February 18, 2008, 546 SCRA 180, 184.
[26] See also First Bancorp, Inc. v. Court of Appeals, G.R. No. 151132,
June 22, 2006, 492 SCRA 221, 238, where the Court issued a similar
explanation, to wit:
A question of fact exists when a doubt or difference arises as to the
truth or falsity of alleged facts. If the query requires a reevaluation of the
credibility of witnesses or the existence or relevance of surrounding
circumstances and their relation to each other, the issue in that query is
factual. On the other hand, there is a question of law when the doubt or
difference arises as to what the law is on certain
291
VOL. 731, JULY 30, 2014 291

The nature of the issues to be raised on appeal can be

gleaned from the appellant’s notice of appeal filed in the
trial court, and from the appellant’s brief submitted to the
appellate court.[27] In this case, the petitioners filed a
notice of appeal in which they contended that the April 26,
2002 decision and the order of July 17, 2002 issued by the
RTC denying their consolidated motion for reconsideration
were contrary to the facts and law obtaining in the
consolidated cases.[28] In their consolidated memorandum
filed in the CA, they essentially assailed the RTC’s ruling
that the taxes imposed on and collected from the
petitioners under Section 21 of the Revenue Code of Manila
constituted double taxation in the strict, narrow or
obnoxious sense. Considered together, therefore, the notice
of appeal and consolidated memorandum evidently did not
raise issues that required the reevaluation of evidence or
the relevance of surrounding circumstances.
The CA rightly concluded that the petitioners thereby

raised only a question of law. The dismissal of their appeal
was proper, strictly speaking, because Section 2, Rule 50 of
the Rules of Court provides that an appeal from the RTC to
the CA raising only questions of law shall be dismissed;
and
_______________
state of facts and which does not call for an existence of the
probative value of the evidence presented by the parties-litigants.
In a case involving a question of law, the resolution of the issue
rests solely on what the law provides on the given set of
circumstances. Ordinarily, the determination of whether an
appeal involves only questions of law or both questions of law and
fact is best left to the appellate court. All doubts as to the
correctness of the conclusions of the appellate court will be
resolved in favor of the CA unless it commits an error or commits
a grave abuse of discretion.
[27] Tamondong v. Court of Appeals, G.R. No. 158397, November 26,
2004, 444 SCRA 509, 517.
[28] Rollo, p. 418.
292

that an appeal erroneously taken to the CA shall be

outrightly dismissed.[29]
2.
Collection of taxes pursuant to Section 21 of the
Revenue Code of Manila constituted double taxation
The foregoing notwithstanding, the Court, given the
circumstances obtaining herein and in light of
jurisprudence promulgated subsequent to the filing of the
petition, deems it fitting and proper to adopt a liberal
approach in order to render a just and speedy disposition of
the substantive issue at hand. Hence, we resolve, bearing
in mind the following pronouncement in Go v. Chaves:[30]
Our rules of procedure are designed to facilitate the orderly

disposition of cases and permit the prompt disposition of
unmeritorious cases which clog the court dockets and do little
more than waste the courts’ time. These technical and procedural
rules, however, are intended to ensure, rather than suppress,
substantial justice. A deviation from their rigid enforcement may
thus be allowed, as petitioners should be given the fullest
opportunity to establish the merits of their case, rather than lose

their property on mere technicalities. We held in Ong Lim Sing,
Jr. v. FEB Leasing and Finance Corporation that:
Courts have the prerogative to relax procedural rules of even
the most mandatory character, mindful of the duty to reconcile
both the need to speedily put an end to litigation and the parties’
right to due process. In numerous cases, this Court has allowed
liberal construction of the rules when to do so
_______________
[29] Sevilleno v. Carilo, G.R. No. 146454, September 14, 2007, 533 SCRA 385,
389.
[30] G.R. No. 182341, April 23, 2010, 619 SCRA 333, 342-343.
293
VOL. 731, JULY 30, 2014 293

would serve the demands of substantial justice and equity.
The petitioners point out that although Section 21 of

the Revenue Code of Manila was not itself unconstitutional
or invalid, its enforcement against the petitioners
constituted double taxation because the local business
taxes under Section 15 and Section 17 of the Revenue Code
of Manila were already being paid by them.[31] They
contend that the proviso in Section 21 exempted all
registered businesses in the City of Manila from paying the
tax imposed under Section 21;[32] and that the exemption
was more in accord with Section 143 of the Local
Government Code,[33] the law that vested in the mu-
_______________
[31] Rollo, pp. 43-44.
[32] Id., at p. 49.
[33] Section 143. Tax on Business.—The municipality may impose
taxes on the following businesses:
(a) On manufacturers, assemblers, repackers, processors, brewers,
distillers, rectifiers, and compounders of liquors, distilled spirits, and
wines or manufacturers of any article of commerce of whatever kind or
nature, in accordance with the following schedule: x x x
(b) On wholesalers, distributors, or dealers in any article of commerce
of whatever kind or nature in accordance with the following schedule:
x x x
(c) On exporters, and on manufacturers, millers, producers,
wholesalers, distributors, dealers or retailers of essential commodities
enumerated hereunder at a rate not exceeding one-half (1/2) of the rates

prescribed under subsections (a), (b) and (d) of this Section: x x x
(d) Provided, however, That barangays shall have the exclusive power
to levy taxes, as provided under Section 152 hereof, on gross sales or
receipts of the preceding calendar year of Fifty thousand pesos
(P50,000.00) or less, in the case of cities, and Thirty thousand pesos
(P30,000) or less, in the case of municipalities.
(e) On contractors and other independent contractors, in accordance
with the following schedule: x x x
(f) On banks and other financial institutions, at a rate not exceeding
fifty percent (50%) of one percent (1%) on the gross receipts
294

nicipal and city governments the power to impose business

taxes.
The respondents counter, however, that double taxation
did not occur from the imposition and collection of the tax
pursuant to Section 21 of the Revenue Code of Manila;[34]
that the taxes imposed pursuant to Section 21 were in the
concept of indirect taxes upon the consumers of the goods
and services sold by a business establishment;[35] and that
the petitioners did not exhaust their administrative
remedies by first appealing to the Secretary of Justice to
challenge the constitutionality or legality of the tax
ordinance.[36]
In resolving the issue of double taxation involving
Section 21 of the Revenue Code of Manila, the Court is
mindful of the ruling in City of Manila v. Coca-Cola
Bottlers Philippines, Inc.,[37] which has been reiterated in
Swedish Match Philippines, Inc. v. The Treasurer of the
City of Manila.[38] In the latter, the Court has held:
_______________
of the preceding calendar year derived from interest, commissions and
discounts from lending activities, income from financial leasing, dividends,
rentals on property and profit from exchange or sale of property,
insurance premium.
(g) On peddlers engaged in the sale of any merchandise or article of
commerce, at a rate not exceeding Fifty pesos (P50.00) per peddler
annually.
(h) On any business, not otherwise specified in the preceding
paragraphs, which the sanggunian concerned may deem proper to tax:
Provided, That on any business subject to the excise, value-added or
percentage tax under the National Internal Revenue Code, as amended,

the rate of tax shall not exceed two percent (2%) of gross sales or receipts
of the preceding calendar year.
[34] Rollo, p. 485.
[35] Id., at p. 484.
[36] Id., at pp. 486-487.
[37] G.R. No. 181845, August 4, 2009, 595 SCRA 299 and G.R. No.
167283, February 10, 2010.
[38] G.R. No. 181277, July 3, 2013, 700 SCRA 428, 439-442.
295
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x x x [T]he issue of double taxation is not novel, as it has

already been settled by this Court in The City of Manila v. Coca-
Cola Bottlers Philippines, Inc., in this wise:
Petitioners obstinately ignore the exempting proviso in Section
21 of Tax Ordinance No. 7794, to their own detriment. Said
exempting proviso was precisely included in said section so as to
avoid double taxation.
Double taxation means taxing the same property twice when it
should be taxed only once; that is, “taxing the same person twice
by the same jurisdiction for the same thing.” It is obnoxious when
the taxpayer is taxed twice, when it should be but once. Otherwise
described as “direct duplicate taxation,” the two taxes must be
imposed on the same subject matter, for the same purpose,
by the same taxing authority, within the same jurisdiction,
during the same taxing period; and the taxes must be of the
same kind or character.
Using the aforementioned test, the Court finds that there is
indeed double taxation if respondent is subjected to the taxes
under both Sections 14 and 21 of Tax Ordinance No. 7794, since
these are being imposed: (1) on the same subject matter — the
privilege of doing business in the City of Manila; (2) for the same
purpose — to make persons conducting business within the City
of Manila contribute to city revenues; (3) by the same taxing
authority — petitioner City of Manila; (4) within the same taxing
jurisdiction — within the territorial jurisdiction of the City of
Manila; (5) for the same taxing periods — per calendar year; and
(6) of the same kind or character — a local business tax imposed
on gross sales or receipts of the business.
296

The distinction petitioners attempt to make between the taxes

under Sections 14 and 21 of Tax Ordinance No. 7794 is specious.
The Court revisits Section 143 of the LGC, the very source of the
power of municipalities and cities to impose a local business tax,
and to which any local business tax imposed by petitioner City of
Manila must conform. It is apparent from a perusal thereof that
when a municipality or city has already imposed a business tax on
manufacturers, etc. of liquors, distilled spirits, wines, and any
other article of commerce, pursuant to Section 143(a) of the LGC,
said municipality or city may no longer subject the same
manufacturers, etc. to a business tax under Section 143(h) of the
same Code. Section 143(h) may be imposed only on businesses
that are subject to excise tax, VAT, or percentage tax under the
NIRC, and that are “not otherwise specified in preceding
paragraphs.” In the same way, businesses such as respondent’s,
already subject to a local business tax under Section 14 of Tax
Ordinance No. 7794 [which is based on Section 143(a) of the
LGC], can no longer be made liable for local business tax under
Section 21 of the same Tax Ordinance [which is based on Section
143(h) of the LGC].
Based on the foregoing reasons, petitioner should not have
been subjected to taxes under Section 21 of the Manila Revenue
Code for the fourth quarter of 2001, considering that it had
already been paying local business tax under Section 14 of the
same ordinance.
xxxx
Accordingly, respondent’s assessment under both Sections 14
and 21 had no basis. Petitioner is indeed liable to pay business
taxes to the City of Manila; nevertheless, considering that the
former has already paid these taxes under Section 14 of the
Manila Revenue Code, it is exempt from the same payments
under Sec-
297
VOL. 731, JULY 30, 2014 297

tion 21 of the same code. Hence, payments made under Section 21

must be refunded in favor of petitioner.
It is undisputed that petitioner paid business taxes based on
Sections 14 and 21 for the fourth quarter of 2001 in the total
amount of P470,932.21. Therefore, it is entitled to a refund of
P164,552.04 corresponding to the payment under Section 21 of
the Manila Revenue Code.
On the basis of the rulings in Coca-Cola Bottlers

Philippines, Inc. and Swedish Match Philippines, Inc., the
Court now holds that all the elements of double taxation

concurred upon the City of Manila’s assessment on and
collection from the petitioners of taxes for the first quarter
of 1999 pursuant to Section 21 of the Revenue Code of
Manila.
Firstly, because Section 21 of the Revenue Code of
Manila imposed the tax on a person who sold goods and
services in the course of trade or business based on a
certain percentage of his gross sales or receipts in the
preceding calendar year, while Section 15 and Section 17
likewise imposed the tax on a person who sold goods and
services in the course of trade or business but only
identified such person with particularity, namely, the
wholesaler, distributor or dealer (Section 15), and the
retailer (Section 17), all the taxes — being imposed on the
privilege of doing business in the City of Manila in order to
make the taxpayers contribute to the city’s revenues —
were imposed on the same subject matter and for the same
purpose.
Secondly, the taxes were imposed by the same taxing
authority (the City of Manila) and within the same
jurisdiction in the same taxing period (i.e., per calendar
year).
Thirdly, the taxes were all in the nature of local
business taxes.
We note that although Coca-Cola Bottlers Philippines,
Inc. and Swedish Match Philippines, Inc. involved
Section 21 vis-à-vis Section 14 (Tax on Manufacturers,
Assemblers and
298

Other Processors)[39] of the Revenue Code of Manila, the

legal principles enunciated therein should similarly apply
because Section 15 (Tax on Wholesalers, Distributors, or
Dealers) and Section 17 (Tax on Retailers) of the Revenue
Code of Manila imposed the same nature of tax as that
imposed under Section 14, i.e., local business tax, albeit on
a different subject matter or group of taxpayers.
In fine, the imposition of the tax under Section 21 of the
Revenue Code of Manila constituted double taxation, and
the taxes collected pursuant thereto must be refunded.
WHEREFORE, the Court GRANTS the petition for
review on certiorari; REVERSES and SETS ASIDE the
resolutions promulgated on June 18, 2007 and November
14, 2007 in C.A.-G.R. S.P. No. 72191; and DIRECTS the

City of Manila to refund the payments made by the
petitioners of the taxes assessed and collected for the first
quarter of 1999 pursuant to Section 21 of the Revenue Code
of Manila.
No pronouncement on costs of suit.
SO ORDERED.
Sereno (CJ., Chairperson), Leonardo-De Castro,

Villarama, Jr. and Reyes, JJ., concur.
Petition granted, resolutions reversed and set aside.
Notes.—Properties owned by the Republic of the

Philippines are exempt from real property tax “except
when the beneficial use thereof has been granted, for
consideration or otherwise, to a taxable person” — the
portions of the proper-
_______________
[39] Section 14. Tax on Manufacturers, Assemblers and Other
Processors.—There is hereby imposed a graduated tax on manufacturers,
assemblers, repackers, processors, brewers, distillers, rectifiers, and
compounders of liquors, distilled spirits, and wines or manufacturers of
any article of commerce of whatever kind or nature, in accordance with
any of the following schedule: x x x
299
VOL. 731, JULY 30, 2014 299

ties not leased to taxable entities are exempt from real

estate tax while the portions of the properties leased to
taxable entities are subject to real estate tax. (City of Pasig
vs. Republic, 656 SCRA 271 [2011])
Double taxation means taxing the same property twice
when it should be taxed only once; that is, “taxing the same
person twice by the same jurisdiction for the same thing.”
(Swedish Match Philippines, Inc. vs. The Treasurer of the
City of Manila, 700 SCRA 428 [2013])
——o0o——
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2/22/2019 SUPREME COURT REPORTS ANNOTATED VOLUME 731

G.R. No. 180651. July 30, 2014.*

Remedial Law; Civil Procedure; Appeals; Modes of Appeal

VOL. 731, JULY 30, 2014 281

Nursery Care Corporation vs. Acevedo

PETITION for review on certiorari of the resolutions of

282 SUPREME COURT REPORTS ANNOTATED

Office of the City Legal Officer for respondent.

VOL. 731, JULY 30, 2014 283

business licenses for the year 1999. Section 21 of the

Section 21. Tax on Business Subject to the Excise, Value-

following businesses and articles of commerce subject to the

To comply with the City of Manila’s assessment of taxes

By letter dated March 1, 1999, the petitioners formally

284 SUPREME COURT REPORTS ANNOTATED

ever, then City Treasurer Anthony Acevedo (Acevedo)

branches, but were soon consolidated in Branch 34.[12]

(a) Whether or not the collection of taxes under Section 21 of

VOL. 731, JULY 30, 2014 285

legality and oppressiveness under Section 187 of the Local

Decision of the RTC

The Court perceives of no instance of the constitutionally

imposed under Sections 15 and 17 is a tax on the business of

286 SUPREME COURT REPORTS ANNOTATED

paying the tax are the consumers or end-users of the articles

Wherefore, the petitions are dismissed. Without

The petitioners appealed to the CA.[17]

VOL. 731, JULY 30, 2014 287

The six (6) cases were consolidated on a common question of

288 SUPREME COURT REPORTS ANNOTATED

WHEREFORE, the foregoing considered, the appeal is

The petitioners moved for reconsideration, but the

VOL. 731, JULY 30, 2014 289

NUE CODE OF THE CITY OF MANILA, IS CONSTITUTIVE OF

The main issues for resolution are, therefore, (1)

290 SUPREME COURT REPORTS ANNOTATED

law.[22] The third mode of appeal is elevated to the

x x x For a question to be one of law, the same must not involve

circumstances. Once it is clear that the issue invites a review of

VOL. 731, JULY 30, 2014 291

The nature of the issues to be raised on appeal can be

The CA rightly concluded that the petitioners thereby

292 SUPREME COURT REPORTS ANNOTATED

that an appeal erroneously taken to the CA shall be

Our rules of procedure are designed to facilitate the orderly

opportunity to establish the merits of their case, rather than lose

VOL. 731, JULY 30, 2014 293

would serve the demands of substantial justice and equity.

The petitioners point out that although Section 21 of

enumerated hereunder at a rate not exceeding one-half (1/2) of the rates

294 SUPREME COURT REPORTS ANNOTATED

nicipal and city governments the power to impose business

percentage tax under the National Internal Revenue Code, as amended,

VOL. 731, JULY 30, 2014 295

x x x [T]he issue of double taxation is not novel, as it has

296 SUPREME COURT REPORTS ANNOTATED

The distinction petitioners attempt to make between the taxes

VOL. 731, JULY 30, 2014 297

tion 21 of the same code. Hence, payments made under Section 21