CE Casecnan Water v. Nueva Ecija
REITERATIONFacts
1. The Antecedents: Petitioner CE Casecnan Water and Energy Company, Inc. (CE Casecnan) entered into a build-operate-transfer contract with the National Irrigation Administration (NIA) for the Casecnan Multi-Purpose Irrigation and Power Project. A supplemental agreement stipulated that NIA would reimburse CE Casecnan for real property taxes (RPT) paid upon NIA's directive and with the Department of Finance's concurrence. CE Casecnan received notices of assessment for RPT from the Province of Nueva Ecija for the years 2002 to 2008, totaling over P1.2 billion. CE Casecnan paid these assessments under protest and initiated appeals with local assessment boards. 2. Procedural History: CE Casecnan filed a complaint with the Regional Trial Court (RTC) for injunction and damages, seeking to restrain the collection of the RPT reassessment. The RTC denied CE Casecnan's application for a temporary restraining order (TRO) and later denied its application for a writ of preliminary injunction. CE Casecnan then filed a Petition for Certiorari with the Court of Appeals (CA) to annul the RTC's orders denying the injunction. The CA dismissed the petition for lack of jurisdiction, ruling that the Court of Tax Appeals (CTA) had exclusive jurisdiction over such matters. CE Casecnan's motion for reconsideration was denied. 3. The Petition: CE Casecnan filed this Petition for Review on Certiorari under Rule 45 of the Rules of Court, assailing the CA's decision to dismiss its certiorari petition for lack of jurisdiction. CE Casecnan argues that the CA, not the CTA, has jurisdiction because its original action was an ordinary civil action for injunction, not a local tax case, and it sought to enjoin collection rather than directly protest the assessment. The respondents contend that resolving the injunction necessarily involves passing on the validity of the RPT assessment, thus falling under the CTA's jurisdiction.
Issue(s)
Whether the Court of Appeals (CA) has jurisdiction over a Petition for Certiorari assailing an interlocutory order issued by the Regional Trial Court (RTC) in a local tax case. Whether the injunction case filed by petitioner with the RTC is an ordinary civil action or a local tax case.
Ruling
The Petition is DENIED. The November 2, 2010 Decision and March 24, 2011 Resolution of the Court of Appeals in CA-G.R. SP No.108441 are AFFIRMED.
Ratio Decidendi
On the jurisdiction of the CTA over a Petition for Certiorari assailing an interlocutory order of the RTC in a local tax case: The Supreme Court reiterated that jurisdiction over the subject matter is conferred by law and a court lacking jurisdiction cannot decide a case on the merits. Pursuant to Republic Act No. 9282, the CTA has exclusive appellate jurisdiction to review decisions, orders, or resolutions of the RTC in local tax cases. The Court, in City of Manila v. Grecia-Cuerdo, ruled that the CTA has jurisdiction to issue writs of certiorari or to determine grave abuse of discretion by the RTC in issuing interlocutory orders in cases falling within the CTA's exclusive appellate jurisdiction. This is based on the constitutional mandate for courts to settle actual controversies and determine grave abuse of discretion. Furthermore, the principle that a court may issue a writ of certiorari in aid of its appellate jurisdiction if it has jurisdiction to review the lower court's final orders or decisions applies. The Court emphasized that allowing the CA to exercise jurisdiction would lead to a split-jurisdiction situation, which is contrary to the orderly administration of justice. The grant of appellate jurisdiction implies the power to make all necessary orders to preserve the subject of the action and give effect to the final determination of the appeal, including the power to protect that jurisdiction. Therefore, it is settled that the CTA has exclusive jurisdiction over a special civil action for certiorari assailing an interlocutory order issued by the RTC in a local tax case. On whether the injunction case is a local tax case: The Supreme Court found that the petitioner's argument that the injunction case is an ordinary civil action and not a local tax case is without merit. While the action was for injunction, the underlying issue was the collection of real property tax. In praying to restrain the collection of RPT, the petitioner implicitly questioned the propriety of the assessment itself, as the RTC would have to rule on the assessment's validity to determine whether to grant the injunction. The subject matter and issues, not merely the remedy sought, control jurisdiction. The Court noted that even an ancillary action for injunction in a tax matter requires the court to determine applicable tax laws. Moreover, in previous rulings, the Court has held that local tax cases include real property tax. Therefore, the injunction case before the RTC was indeed a local tax case, and a certiorari petition questioning an interlocutory order in such a case falls under the jurisdiction of the CTA. The CA correctly dismissed the Petition for Certiorari for lack of jurisdiction.
Main Doctrine
The Court of Tax Appeals (CTA) has exclusive jurisdiction over a special civil action for certiorari assailing an interlocutory order issued by the Regional Trial Court (RTC) in a local tax case.