CASE DIGEST

CIR VS GENERAL FOODS,  G.R. No. 143672 April 24, 2003 FACTS: On June 14, 1985, respondent corporation, General Foods (Phils.) Inc., which is engaged in the manufacture of beverages such as "Tang," "Calumet" and "Kool-Aid," filed its income tax return for the fiscal year ending February 28, 1985. In said tax return, respondent corporation claimed as deduction, among other business expenses, the amount of  P 9,461,246 for media advertising for "Tang." The Commissioner disallowed 50% or P4,730,623 of the deduction claimed by respondent corporation. Consequently, respondent corporation was assessed deficiency income taxes in the amount of P2,635, 141.42. The latter filed a motion for reconsideration but the same was denied. On September 29, 1989, respondent corporation appealed to the Court of Tax Appeals but the appeal was dismissed: Aggrieved, respondent corporation filed a petition for review at the Court of Appeals which rendered a decisi...

Lee vs. Tambago (A.C. No. 5281, February 12, 2008) FACTS: Complainant Manuel L. Lee charged respondent Atty. Regino B. Tambago with violation of the Notarial Law and the ethics of the legal profession for notarizing a spurious last will and testament. The complainant averred that his father, the decedent Vicente Lee, Sr., never executed the contested will and that the spurious will contained the forged signatures of Cayetano Noynay and Loreto Grajo, the purported witnesses to its execution. The will was purportedly executed and acknowledged before respondent on June 30, 1965. Complainant, however, pointed out that the residence certificate of the testator noted in the acknowledgment of the will was dated January 5, 1962. Furthermore, the signature of the testator was not the same as his signature as donor in a deed of donation. Complainant also questioned the absence of notation of the residence certificates of the purported witnesses Noynay and Grajo. Complainant further a...

  Association of Non-Profit Clubs, Inc. v. Bureau of Internal Revenue, G.R. No. 228539, June 26, 2019 v.)   RECIT READY: Revenue Memorandum Circular No. 35-2012 was issued by BIR clarifying the taxability (particularly, income tax and VAT liability) of clubs organized and operated exclusively for pleasure, recreation, and other non-profit purposes based on the BIR's own interpretation of the NIRC provisions on income tax and VAT. Association of Non-Profit Clubs, Inc. (ANPC) filed a petition 4  for declaratory relief assailing the correctness of the interpretation of BIR embodied in the circular. The court ruled that the interpretation was invalid. Membership fees are contributions for the maintenance of the clubs (part of the capital) and do not represent realized gains or profits. Therefore, these fees should not be classified as income subject to taxation. Meanwhile, membership fees, assessment dues, and the like are not subject to VAT because in collecting such...

CASE: Commissioner vs. Algue, Inc., G.R. No. L-28896, February 17, 1988 FACTS:  Private respondent, a domestic corporation engaged in engineering, construction and other allied activities, received a letter from the petitioner assessing it in the total amount of P83,183.85 as delinquency income taxes for the years 1958 and 1959.  Algue flied a letter of protest or request for reconsideration.  The disputed amount was a P75,000 deduction claimed by Algue as promotional fees paid to individuals for their work in creating the Vegetable Oil Investment Corporation and its purchase of properties from the Philippine Sugar Estate Development Company. The petitioner contends that the claimed deduction of P75,000.00 was properly disallowed because it was not an ordinary reasonable or necessary business expense.  The Court of Tax Appeals had seen it differently. Agreeing with Algue, it held that the said amount had been legitimately paid by the private respondent for actual ser...

 CASE: City of Cagayan De Oro vs. CEPALCO, G.R. No. 224825, October 17, 2018 FACTS: The City of Cagayan de Oro enacted Ordinance No. 9527-2005, imposing an annual Mayor's Permit Fee of P500 on every electric or telecommunications post belonging to public utility companies operating in the city. Petitioner, Cagayan Electric Power & Light Co., Inc. (CEPALCO), a public utility engaged in the distribution of electric power and the owner of an estimated 17,000 utility poles erected within Cagayan de Oro City filed a Declaratory Relief with Damages & Prayer for Temporary Restraining Order & Preliminary Injunction before the Cagayan RTC assailing the ordinance's validity. CEPALCO contended that the imposition, in the guise of police power, was unlawful for violating the fundamental principle that fees, charges, and other impositions shall not be unjust, excessive, oppressive, or confiscatory. The RTC dismissed the case due to CEPALCO's failure to exhaust administrativ...