THE COURT of Tax Appeals (CTA) has rejected a petition by Philippine Long Distance Telephone Co., Inc. (PLDT), ruling that a Makati court has no jurisdiction over the company’s dispute with Tuguegarao City over P2.455 million in unpaid franchise taxes.
In a 15-page decision promulgated June 17, the CTA, sitting en banc, voted 5-3 to deny PLDT’s petition against the CTA Second Division, which originally declared improper jurisdiction on the part of Makati Regional Trial Court Branch 132.
The CTA cited a similar case in Bataan which declared the proper venue to hear a dispute within the province to be the Balanga City RTC.
It added that though PLDT headquarters is in Makati, the Makati RTC cannot “order respondents to cease and desist from assessing and collecting... business tax in addition to the franchise tax based on the same gross receipts.”
The CTA cited Section 21 of Batasang Pambansa (BP) 129 which states that “injunctive writs issued by an RTC are enforceable only within the judicial region where such court belongs,” emphasizing that the correct lower court to handle the case is the RTC of Tuguegarao.
The ruling was written by Associate Justice Esperanza R. Fabon-Victorino and concurred in by Associate Justices Juanito C. Castañeda, Jr., Erlinda P. Uy, Cielito N. Mindaro-Grulla and Caesar A. Casanova.
Dissenting were Associate Justices Lovell R. Bautista, Ma. Belen M. Ringpis-Liban and Presiding Justice Roman G. del Rosario.
In 2006, the company was compelled to pay franchise tax in Cebu City as ordered by the Supreme Court amounting to P432,468.75 after it failed to make payments from 1999-2003.
PLDT challenged Cebu City in 2004 on the imposition of franchise tax, claiming it is exempt.
Hastings Holdings, Inc. -- a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc. -- has a stake in BusinessWorld through the Philippine Star Group, which it controls.
source: Businessworld
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