REPUBLIC OF THE PHILIPPINES

COURT OF TAX APPEALS

QUEZON CITY

SPECIAL SECOND DIVISION

CASAS+ ARCHITECTS, CTA AC Case No. 259

Petitioner,
Members:

-versus- BACORRO-VILLENA, Acting Chairpersc

CUI-DAVID, JJ.

THE CITY OF MAKATI AND

JESUSA E. CUNETA, IN HER
CAPACITY AS THE CITY
TREASURER OF THE CITY OF Promulgated:
MAKATI,
Respondents. MAY 2 9 2023 /
X- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ; ; : - - - - - - - X

RESOLUTION f 'f:ur f"".

CUI-DAVID, J.:

For this Court's resolution is respondents' Motion for

Reconsideration (Re: Decision dated 24 November 2022)
("Motion") flied on 2 December 2022, with petitioner's
Comment/Opposition flied on 14 March 2023.

Respondents' Motion seeks reconsideration of the Decision

of the Court promulgated on 24 November 2022. The dispositive
portion reads:

WHEREFORE, in light of the foregoing, the instant

Petition for Review is PARTIALLY GRANTED. The assailed
Order of the RTC Makati in Civil Case No. R-MKT-17-02275-
CV dated 4 November 2021 is REVERSED and SET ASIDE,
and its Decision dated 30 July 2021 is REINSTATED.

Accordingly, respondents are ORDERED to refund or

credit in favor of petitioner Casas+ Architects the reduced
amount of 1"835, 151.26 representing its erroneously or
illegally paid local business tax for the 3rd and 4th quarters of
the taxable year 2015.

v
RESOLUTION
CTA AC No. 259
Casas+ Architects vs. The City of Makati and Jesusa E. Cuneta, in her capacity as the
City Treasurer of the City of Makati
Page 2 of 6
X------------------------------------------------------------------------------------------X

SO ORDERED.

Respondents assert that petitioner did not file the proper

protest. Respondents maintain their position that the billing
assessments issued by them to petitioner in relation to the
latter's renewal of business permits are the assessments
contemplated under Section 195 of the Local Government Code
("LGC"),I stating that local business taxes are within the ambit
of the said provision. 2 It is respondents' theory that, considering
petitioner's admission that it was constrained to pay the taxes
indicated in the billing assessments for the issuance of business
permits, 3 petitioner had the opportunity to protest it being
assessed as a contractor.4

Respondents further state that petitioner "cannot

successfully prosecute [its] theory of erroneous payment or
illegal collection of taxes without necessarily assailing the
validity or correctness of the assessment."5 Thus, respondents
maintain that the proper procedure is to pay the tax and
administratively assail the assessment within sixty (60) days
before the local treasurer and to bring an action in Court within
thirty (30) days from the decision or inaction by the local
treasurer. 6

Respondents further assert that petitioner is not purely a

general professional partnership ("GPP''); its admission that it
hired a significant number of workers and even admitted to
outsourcing some aspects of its service contracts makes it not
a purely general professional partnership; 7 even if petitioner is
a GPP, under Section 147 of the LGC, a Mayor's Permit Fee
should still be secured to operate a business involving the
exercise of a profession. s

In its Comment, petitioner argues that the billing

assessments sent to it by respondents are not the assessments
contemplated by Section 195 of the LGC. 9 Invoking the
phraseology of Section 195 of the LGC, petitioner posits that an
assessment must be triggered or preceded by a "finding," which

1
2
Motion for Reconsideration (Re: Decision dated 24 November 2022), par. I.
/d., par. 3.
~
3 /d., par. 7.
4 !d., par. 8.
5
/d.. r•r 12.
6
/d., par. 15.
7
/d., pars. 5-7.
8 /d., par. 2.
9
Comment/Opposition, pars. 3-4
RESOLUTION
CTA AC No. 259
Casas+ Architects vs. The City of Makati and Jesusa E. Cuneta, in her capacity as the
City Treasurer of the City of Makati
Page 3 of6
x------------------------------------------------------------------------------------------x
presupposes an examination of the taxpayer. 10 Petitioner
submits that the billing assessments were only issued in
relation to its application for renewal of its business permits and
not issued or made after an examination. 11 Thus, according to
petitioner, it has a two-year period under Section 196 of the
LGC, which it contends to be the applicable provision.l2

Petitioner also forwards that it is a GPP based on the

testimonies of its witnessesl3 and its Articles of Partnership.l 4
According to petitioner, interior decorating and landscaping
services are "related services" and should not be taken apart
from its architectural services. 15 Petitioner finds fault in
respondents' conclusion that it hires "laborers and construction
workers."l6

An examination of respondents' Motion for Reconsideration

shows that the arguments therein are mere reiterations of the
arguments already passed upon by this Court.

When there is no new issue, there is no need for further

judicial determination. There is no necessity to discuss and rule
again since "this would be a useless formality of ritual invariably
involving merely a reiteration of the reasons already set forth in
the judgment or final order for rejecting the arguments
advanced by the movant."l7

This Court resolves to maintain its ruling that Section 196

of the LGC is the applicable law in the instant case. We reiterate
our finding that no assessment notice has been issued and that
the billing statements issued are not the assessment notices
required by Section 195 of the LGC. We quote:

The ruling of the Supreme Court in Cosmos Bottling and

ICTSI is clear and unequivocal. If the taxpayer receives an
assessment and does not pay the tax, its remedy is strictly
confined to Section 195 of the LGC. Thus, it must file a written
protest with the local treasurer within 60 days from receipt of
the assessment. If the protest is denied, or
if the local treasurer fails to act on it, then the taxpayer must
appeal the assessment before a court of competent

10
11
12
/d., par. 5.
/d., par. 6.
y
/d., pars. 9-14.
11
/d., pur. 15.
14 /d., par. 16.
15 /d., par. 17.
16
/d., par. 18.
17
People v. Agocer, G.R. No. 177751 (Resolution). 7 January 2013,701 SCRA 37-44.
RESOLUTION
CTA AC No. 259
Casas+ Architects vs. The City of Makati and Jesusa E. Cuneta, in her capacity as the
City Treasurer of the City of Makati
Page 4 of6
x------------------------------------------------------------------------------------------x

jurisdiction within 30 days from receipt of the denial, or the

lapse of the 60-day period within which the local treasurer
must act on the protest.

If the taxpayer opts to pay the assessed tax, fee, or

charge, it must still file the written protest within the 60-day
period, and then bring the case to court within 30 days from
either the decision or inaction of the local treasurer. In its
court action, the taxpayer may, at the same time, question the
validity and correctness of the assessment and seek a refund
of the taxes it paid.

On the other hand, if no assessment notice is issued by

the local treasurer, and the taxpayer claims that it
erroneously paid a tax, fee, or charge, or that the tax, fee, or
charge has been illegally collected from him, then
Section 196 applies.

Here, petitioner correctly invoked that these billing

statements/ assessments do not constitute "assessments"
within the ambit of Section 195 of the LGC. Hence, Section
196 of the LGC governs petitioner's claim for refund from the
second quarter of 2014 to the fourth quarter of 2015.

To reiterate, the billing statements/ assessments were

issued by respondents after petitioner's renewal of its
business permit for the years 20 14 and 2015. Petitioner's
Head of Finance and Accounting, Bernadith Bersabe Naiiaga,
testified on direct examination by way of her Judicial Affidavit
that the billing statements were in fact issued for local
business taxes covering the years 2014 and 2015, and not for
deficiency taxes, viz.:

It is clear from the foregoing that there was no prior

investigation or examination of petitioner's books of accounts
that resulted in a "finding" of deficiency taxes. Neither was
there any letter of authority authorizing the examination of
petitioner's books before the billing statements/ assessments
were issued. In fine, their issuance was not triggered or
preceded by a "finding" of deficiency or incorrect tax payments
by the local treasurer after an examination of its books was
conducted.

Given the foregoing, petitioner properly applied Section

196 in the present claim for refund. To reiterate, the billing
statements/ assessments are not the assessments
contemplated under Section 195 of the LGC ....

t«'
RESOLUTION
CTA AC No. 259
Casas+ Architects vs. The City of Makati and Jesusa E. Cuneta, in her capacity as the
City Treasurer of the City of Makati
Page 5 of6
x------------------------------------------------------------------------------------------x

We likewise reiterate our ruling that petitioner was able to

prove that it is a GPP. Thus, it is not subject to the local
business tax ("LBT") imposed under Section 3A.02(g) of the
Revised Makati Revenue Code ("RMRC"). We quote our findings:

As culled from the allegations of petitioner and from the

Decision 18 of the court a quo dated 30 July 2021, respondents
do not dispute that petitioner is a GPP. It is not liable for any
income tax, but its individual partners who are all licensed
architects are subject to individual income taxes. Petitioner
was not taxed as GPP but as the owner or operator of a
business rendering or offering services for interior decorating
and landscaping. Respondents anchor their claim on their
impression, upon review of petitioner's financial statements
for 2013 and 2014 during the renewal of its business permit,
that petitioner was not purely engaged as a GPP but that it
was also engaged in services other than in the exercise of its
profession. Respondents contend that petitioner's Statement
of Comprehensive Income manifests that it was maintaining a
significant number of laborers and construction workers.
Respondents did not present any proof that petitioner
employed laborers and construction workers. On the other
hand, petitioner presented evidence to prove that it is not
involved in interior decoration but in interior design and that
they do not employ laborers and construction workers.

As observed by the court a quo, the pieces of evidence

do not show that petitioner is engaged in interior decorating.
It is involved in interior design and landscaping, which, as
provided in RA 9266 and its IRR, as adequately alleged, and
proven by petitioner, are encompassed by the practice of
architecture.

Further, contrary to respondents' argumentation, the

Mayor's Permit Fee is an imposition separate and distinct from
the LBT imposed under Section 3A.02(g) of the RMRC. To be
clear, petitioner does not question the authority of respondents
to impose a mayor's permit fee, nor did this Court's decision
rule on such matter.

Guided by the foregoing, this Court finds no reason to

disturb its Decision.

WHEREFORE, in light of the foregoing, respondents'

Motion for Reconsideration (Re: Decision dated 24 November
2022) is DENIED.

18
t(
Decision dated 30 July 2021 in Civil Case No. R·MKT-17-02275-CV, Rollo, pp. 49-61.
RESOLUTION
CTA AC No. 259
Casas+ Architects vs. The City of Makati and Jesusa E. Cuneta, in her capacity as the
City Treasurer of the City of Makati
Page 6 of6
X------------------------------------------------------------------------------------------X

SO ORDERED.

LAN~~~AVID
Associate Justice
!CONCUR:

( ~

JEANMA 'RRo-VILLENA