Republic v. Surigao
REITERATIONFacts
The Antecedents: The Asset Privatization Trust (APT), established to manage and dispose of government assets, received non-performing assets from the Development Bank of the Philippines, including those of Nonoc Mining and Industrial Corporation (NMIC). Through an Amended Restated Definitive Agreement (ARDA), APT agreed to sell NMIC shares and receivables to Philnico Mining and Industrial Corporation (PMIC). Due to changes in refinery technology and regional economic issues, PMIC returned certain redundant assets, valued at PHP 85,051,200.00, to APT. Following APT's expiration, the Privatization and Management Office (PMO) took over its functions. The City of Surigao later declared these redundant assets for real property taxation and subsequently demanded payment of PHP 200,739,598.76 in alleged outstanding Real Property Tax (RPT) and penalties, leading to a levy on the assets. Procedural History: The PMO protested the RPT collection, asserting the assets' government ownership and tax-exempt status. Despite the protest, the City Treasurer proceeded with advertising an auction sale of the assets. This prompted the PMO to file a Petition for Prohibition with an application for a Temporary Restraining Order (TRO) and/or Writ of Preliminary Injunction before the Regional Trial Court (RTC) of Surigao City. The RTC denied the application for a preliminary injunction. Subsequently, the PMO filed a petition for certiorari with the Court of Appeals (CA) after learning of a new auction sale date, withdrawing its motion for reconsideration with the RTC. The CA granted a TRO but later denied the certiorari petition on technical grounds, specifically the failure to exhaust administrative remedies and the non-pursuit of a motion for reconsideration. The CA's denial was affirmed through a subsequent resolution, leading to the present petition. The Petition: The Republic of the Philippines, represented by the Privatization and Management Office (PMO), seeks review of the Court of Appeals' Decision and Resolution, arguing that the CA erred in dismissing its petition for certiorari. The core of the PMO's argument is that the redundant assets are government properties and thus exempt from real property tax. The petition before the Supreme Court contends that the CA should have taken jurisdiction over the certiorari petition, as the underlying dispute involves the legality of real property tax collection on government assets. The PMO is also seeking an urgent ex-parte temporary restraining order and/or writ of preliminary injunction to prevent the auction sale of the properties.
Issue(s)
Whether the Court of Appeals erred in dismissing the petition for certiorari on technical grounds. Whether the Court of Tax Appeals has exclusive appellate jurisdiction over local tax cases decided by the Regional Trial Court, including the power to issue writs of certiorari in aid of its appellate jurisdiction.
Ruling
The petition is DENIED. The Decision dated November 17, 2014 and the Resolution dated April 27, 2015 of the Court of Appeals in CA-G.R. SP No. 04987-MIN are SET ASIDE. The Petition for Certiorari filed by petitioner with the Court of Appeals assailing the Resolution dated June 15, 2012 of the Regional Trial Court, Branch 29 of Surigao City in Special Civil Action No. 7450 is DISMISSED for lack of jurisdiction. The Temporary Restraining Order dated July 6, 2015 is LIFTED.
Ratio Decidendi
On the issue of the Court of Appeals' dismissal: The Court held that since the petition for injunction filed before the RTC was a local tax case, any subsequent petition for certiorari assailing an interlocutory order issued by the RTC in that case should have been filed with the CTA, not the Court of Appeals (CA). The CA, therefore, erred in taking cognizance of the petition for certiorari, as it lacked jurisdiction over the subject matter. The Court clarified that allowing the CA to exercise jurisdiction would lead to a split-jurisdiction situation, which is anathema to the orderly administration of justice. The Court cited City of Lapu-Lapu v. Phil. Economic Zone Authority and National Power Corp. v. Provincial Government of Bataan to support the principle that the CTA's appellate jurisdiction is exclusive, and cases involving local tax issues, including those seeking to enjoin the collection of real property taxes, must be appealed to the CTA. Consequently, the CA's decision was deemed void for lack of jurisdiction. On the issue of the Court of Tax Appeals' jurisdiction: The Court reiterated the established doctrine that the Court of Tax Appeals (CTA) possesses exclusive appellate jurisdiction over local tax cases decided by the Regional Trial Court (RTC), as provided under Section 7(a)(3) of Republic Act No. 1125, as amended by Republic Act No. 9282. This jurisdiction extends to cases involving real property taxes. The Court emphasized that this exclusive appellate jurisdiction necessarily includes the power to issue writs of certiorari in aid of its appellate jurisdiction, enabling it to review interlocutory orders issued by the RTC in such cases. The constitutional mandate for courts to settle actual controversies and determine grave abuse of discretion further supports the CTA's authority to issue writs of certiorari in cases falling within its specialized competence. The Court cited City of Manila v. Grecia-Cuerdo to underscore that the grant of appellate jurisdiction to the CTA implies the inclusion of powers necessary for its effective exercise, including the issuance of auxiliary writs like certiorari.
Main Doctrine
The Court of Tax Appeals (CTA) has exclusive appellate jurisdiction over local tax cases decided by the Regional Trial Court (RTC), including the power to issue writs of certiorari in aid of its appellate jurisdiction. A petition for certiorari assailing an interlocutory order issued by the RTC in a local tax case must be filed with the CTA, not the Court of Appeals (CA).