Republic of the Philippines SUPREME COURT Manila THIRD DIVISION G.R

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Republic of the Philippines SUPREME COURT Manila THIRD DIVISION G.R Republic of the Philippines SUPREME COURT Manila THIRD DIVISION G.R. No. 168557 February 16, 2007 FELS ENERGY, INC., Petitioner, vs. THE PRO"INCE OF #$T$NG$S a%& THE OFFICE OF THE PRO"INC $L $SSESSOR OF #$T$NG$S, Respondents. !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! G.R. No. 170628 February 16, 2007 N$TION$L PO'ER CORPOR$TION, Petitioner, vs. LOC$L #O$R( OF $SSESSMENT $PPE$LS OF #$T$NG$S, L$URO C. $N($Y$, )% *)+ ,a-a,).y a+ .*e $++e++or o/ .*e Pro0)%,e o/ #a.a%1a+, a%& .*e PRO"INCE OF #$T$NG$S re-re+e%.e& by ).+ Pro0)%,)a2 $++e++or, Respondents. D " # I S I O N C$LLE3O, SR., J.: $efore us are t%o consolidated cases doc&eted as G.R. No. ()*++, and G.R. No. (,-).*, %hich %ere /led b0 petitioners 1"2S "ner30, Inc. 41"2S5 and National Po%er #orporation 4NP#), respectively. The /rst is a petition for revie% on certiorari assailin3 the 6u3ust .+, .--7 Decision( of the #ourt of 6ppeals 4#6) in #6!'.R. SP No. ),78- and its Resolution. dated June .-, .--+: the second, also a petition for revie% on certiorari, challen3es the 1ebruar0 8, .--+ Decision; and Nove<ber .;, .--+ Resolution7 of the #6 in #6-G.R. SP No. ),78(. $oth petitions %ere dis<issed on the 3round of prescription. The pertinent facts are as follo%s= On Januar0 (*, (88;, NP# entered into a lease contract %ith Polar "ner30, Inc. over ; ;- M> diesel en3ine po%er bar3es <oored at $ala0an $a0 in #alaca, $atan3as. The contract, deno<inated as an "ner30 #onversion 63ree<ent+ 463ree<ent), %as for a period of /ve 0ears. 6rticle (- reads= (-.( R"SPONSI$ILIT?. N6POCOR shall be responsible for the pa0<ent of (a) all ta es, import duties, fees, char3es and other levies imposed b0 the National 'overn<ent of the Republic of the Philippines or an0 a3enc0 or instru<entalit0 thereof to %hich POL6R <a0 be or beco<e subject to or in relation to the perfor<ance of their obligations under this a3ree<ent (other than (i) ta es imposed or calculated on the basis of the net inco<e of POL6R and Personal Inco<e Ta es of its e<plo0ees and (ii) construction per<it fees, environ<ental per<it fees and other si<ilar fees and char3es) and (b) all real estate ta es and assess<ents, rates and other char3es in respect of the Po%er $ar3es.) SubseAuentl0, Polar "ner30, Inc. assi3ned its rights under the 63ree<ent to 1"2S. The NP# initially opposed the assign<ent of rights, citin3 para3raph (,.. of 6rticle (, of the 63ree<ent. 1 On 6u3ust ,, (88+, 1"2S received an assess<ent of real propert0 ta es on the po%er bar3es fro< Provincial 6ssessor Lauro #. 6nda0a of $atan3as #it0. The assessed ta , %hich like%ise covered those due for (887, a<ounted to P+),(*7,-**.7- per annu<. 1"2S referred the <atter to NP#, re<indin3 it of its obligation under the 63ree<ent to pa0 all real estate ta es. It then 3ave NP# the full po%er and authorit0 to represent it in an0 conference re3ardin3 the real propert0 assess<ent of the Provincial 6ssessor. In a letter, dated Septe<ber ,, (88+, NP# sou3ht reconsideration of the Provincial 6ssessorBs decision to assess real propert0 ta es on the po%er bar3es. Ho%ever, the <otion %as denied on Septe<ber .., (88+, and the Provincial 6ssessor advised NP# to pa0 the assess<ent.* This pro<pted NP# to /le a petition %ith the Local $oard of 6ssess<ent 6ppeals 42$66) for the settin3 aside of the assess<ent and the declaration of the bar3es as non-ta able ite<s: it also pra0ed that should 2$66 /nd the bar3es to be ta able, the Provincial 6ssessor be directed to <a&e the necessar0 corrections.8 In its 6ns%er to the petition, the Provincial 6ssessor averred that the bar3es %ere real propert0 for purposes of ta ation under Section (88(c) of Republic 6ct (R.6.) No. ,()-. $efore the case %as decided b0 the 2$66, NP# /led a Manifestation, infor<in3 the 2$66 that the Depart<ent of 1inance (DOF) had rendered an opinion (- dated Ma0 .-, (88), %here it is clearly stated that po%er bar3es are not real propert0 subject to real propert0 assess<ent. On 6u3ust .), (88), the 2$66 rendered a Resolution(( den0in3 the petition. The fallo reads= >HER"1OR", the Petition is DENI"D. 1"2S is hereb0 ordered to pa0 the real estate ta in the a<ount ofP+),(*7,-**.7-, for the 0ear (887. SO ORDER"D.(. The 2$66 ruled that the po%er plant facilities, %hile the0 <a0 be classified as <ovable or personal propert0, are nevertheless considered real propert0 for ta ation purposes because the0 are installed at a specific location %ith a character of per<anenc0. The 2$66 also pointed out that the o%ner of the bar3esC1"2S, a private corporation–is the one bein3 ta ed, not NP#. 6 <ere a3ree<ent <a&in3 NP# responsible for the pa0<ent of all real estate ta es and assess<ents %ill not justif0 the e e<ption of 1"2S: such a privile3e can only be 3ranted to NP# and cannot be e tended to 1"2S. 1inally, the 2$66 also ruled that the petition %as /led out of time. 633rieved, 1"2S appealed the 2$66Bs rulin3 to the #entral $oard of 6ssess<ent 6ppeals 4#$66). On 6u3ust .*, (88), the Provincial Treasurer of $atan3as #it0 issued a Notice of Lev0 and >arrant b0 Distraint(;over the po%er bar3es, see&in3 to collect real propert0 ta es a<ountin3 to P.;.,)-.,(.+.8( as of July ;(, (88). The notice and %arrant %as officially served to 1"2S on Nove<ber *, (88). It then /led a Motion to Lift Lev0 dated Nove<ber (7, (88), pra0in3 that the Provincial 6ssessor be further restrained b0 the #$66 fro< enforcin3 the disputed assess<ent durin3 the pendenc0 of the appeal. On Nove<ber (+, (88), the #$66 issued an Order(7 liftin3 the lev0 and distraint on the properties of 1"2S in order not to pree<pt and render ineffectual, nu3ator0 and illusor0 an0 resolution or jud3<ent %hich the $oard %ould issue. 2 Meantime, the NP# /led a Motion for Intervention(+ dated 6u3ust ,, (88* in the proceedin3s before the #$66. This %as approved b0 the #$66 in an Order() dated Septe<ber .., (88*. Durin3 the pendenc0 of the case, both 1"2S and NP# /led several <otions to ad<it bond to 3uarantee the pa0<ent of real propert0 ta es assessed b0 the Provincial 6ssessor (in the event that the jud3<ent be unfavorable to the<). The bonds %ere duly approved b0 the #$66. On 6pril ), .---, the #$66 rendered a Decision(, /ndin3 the po%er bar3es e e<pt fro< real propert0 ta . The dispositive portion reads= >HER"1OR", the Resolution of the Local $oard of 6ssess<ent 6ppeals of the Province of $atan3as is hereb0 reversed. Respondent-appellee Provincial 6ssessor of the Province of $atan3as is hereb0 ordered to drop subject propert0 under 6RP/Ta Declaration No. -(*!--8+* fro< the List of Ta able Properties in the 6ssess<ent Roll. The Provincial Treasurer of $atan3as is hereb0 directed to act accordin3l0. SO ORDER"D.(* Rulin3 in favor of 1"2S and NP#, the #$66 reasoned that the po%er bar3es belon3 to NP#: since the0 are actually, directly and e clusively used b0 it, the po%er bar3es are covered b0 the e e<ptions under Section .;7(c) of R.6. No. ,()-.(8 6s to the other jurisdictional issue, the #$66 ruled that prescription did not preclude the NP# fro< pursuin3 its claim for ta e e<ption in accordance %ith Section .-) of R.6. No. ,()-. The Provincial 6ssessor /led a <otion for reconsideration, %hich %as opposed b0 1"2S and NP#. In a co<plete volte face, the #$66 issued a Resolution.- on July ;(, .--( reversin3 its earlier decision. The fallo of the resolution reads= >HER"1OR", pre<ises considered, it is the resolution of this $oard that= (a) The decision of the $oard dated ) 6pril .--- is hereb0 reversed. (b) The petition of 1"2S, as %ell as the intervention of NP#, is dis<issed. (c) The resolution of the Local $oard of 6ssess<ent 6ppeals of $atan3as is hereb0 affir<ed, (d) The real propert0 ta assess<ent on 1"2S b0 the Provincial 6ssessor of $atan3as is like%ise hereb0 affir<ed. SO ORDER"D..( 1"2S and NP# /led separate <otions for reconsideration, %hich %ere ti<ely opposed b0 the Provincial 6ssessor. The #$66 denied the said <otions in a Resolution.. dated October (8, .--(. Dissatis/ed, 1"2S /led a petition for revie% before the #6 doc&eted as #6-G.R. SP No. ),78-. Mean%hile, NP# /led a separate petition, doc&eted as #6-G.R. SP No. ),78(. 3 On Januar0 (,, .--., NP# /led a Manifestation/Motion for #onsolidation in #6-G.R. SP No. ),78- pra0in3 for the consolidation of its petition %ith #6-G.R. SP No. ),78(. In a Resolution.; dated 1ebruar0 (., .--., the appellate court directed NP# to re!/le its <otion for consolidation %ith #6-G.R. SP No. ),78(, since it is the ponente of the latter petition %ho should resolve the reAuest for reconsideration. NP# failed to co<ply %ith the aforesaid resolution. On 6u3ust .+, .--7, the T%elfth Division of the appellate court rendered jud3<ent in #6-G.R.
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