Mindanao Shopping v. Davao City
Mindanao Shopping v. Davao City
Mindanao Shopping v. Davao City
, ACE
HARDWARE PHILIPPINES, INC., INTERNATIONAL TOY
WORLD, INC., STAR APPLIANCE CENTER, INC., SUPERVALUE,
INC., SURPLUS MARKETING CORP., and WATSONS
PERSONAL CARE STORES (PHILIPPINES), INC., petitioners, vs.
DAVAO CITY and RODRIGO S. RIOLA, in his capacity as the
City Treasurer of Davao City, respondents
FACTS:
Submitted for the consideration of this Court is the Motion for
Reconsideration 1 filed by petitioners on February 9, 2011, praying
that: (a)
t h e Decision 2 of this Court promulgated on January 21, 2011 be
reconsidered, reversed and set aside; and (b) judgment be rendered
ordering
respondents to refund or issue a tax credit in favor of petitioners in the
total
amount of P39,040,737.74. As an alternative to the foregoing prayer,
petitioners likewise prayed that this Court order the suspension of the
rendition of judgment pending final resolution of the constitutionality
and/or
legality of the Tax Ordinance.
Further, respondents stress that: the rights asserted in the two cases
are intimately related and/or intertwined with one another such that
the
judgment that may be rendered in one, regardless of which party
would be
successful, would amount to res judicata in the other; and the claim
for
refund in the RTC Case is merely an incidental relief which is wholly
dependent on the outcome or resolution of the CA Case.
As their final point, respondents broached their opposition to
petitioners' alternative prayer to suspend the RTC Case until final
resolution
of the CA Case, arguing that the presence of litis pendentia and/or res
judicata does not justify the suspension of the other proceeding, as it
is an
inconsistent remedy, and that to request for the suspension only
supports
the conclusion that one case is dependent on the outcome of the other
case.
The conclusion of this Court in the assailed Decision was reached after
a thorough review of the records at hand, taking into consideration the
application of Section 196 of the Local Government Code, the ruling of
the
Supreme Court in the Alabang Supermarket Case , and the rules of
statutory
construction.
As oft repeated Section 196 of the LGC clearly declares, that
prescription is not reckoned only from the date of payment, but also
from the
"date the taxpayer is entitled to a refund or credit", viz.:
Verily, the crux of the controversy and the reason for the denial of the
refund claim in the Alabang Supermarket Case is the petitioner's
failure to
file an administrative claim for refund. Petitioner in the Alabang
Supermarket
Case subscribes to the interpretation that Section 196 of the LGC
requires it
to wait for the finality of the decision declaring the tax ordinance void
before
filing an administrative claim with the treasurer. The Court En Banc did
not agree and affirmed the view of the Court in Division that " [A]
taxpayer
who believes that he has paid a tax imposed under a void ordinance
should
timely exhaust administrative remedies before resorting to the filing
of a
judicial claim or timely question its constitutionality and legality. "