ACTING COMM. OF CUSTOMS v.

MERALCO
June 30, 1977 | Fernando, J. | Review | Question of Fact
SUMMARY: CTA reversed the determination of the acting Customs
Commissioner that Meralcos importation of insulating oil shall be subject to
special import tax. CTA ruled that under Sec 8 of RA 1394, and Par 9 Part 2
of Meralcos charter, it is expressly excluded from the imposition of all kinds
of taxes. SC held that it is in no position to review the findings of fact of the
CTA as it recognizes the expertise of the same.
DOCTRINE: Only errors of law, and not rulings on the weight of evidence,
are reviewable by the Supreme Court
FACTS:
1. Acting Commissioner of Customs, Noberto Romualdez Jr, determined
that the respondent MERALCO is not exempt from the payment of the
special import tax under RA 1394 for the shipment of its insulating oil.
2. This was brought to the Court of Tax Appeal where it reversed the
determination of Romualdez. It held that it is exempt from the special
import tax by virtue of Sec 8 of RA 1394 which exempts equipments and
spare parts for the use in industries, and also under Par 9 Part two of
Meralcos franchise there it expressly states that insulators, among others,
are exempt from the imposition of taxes. Effectively, the said paragraph 9
exempts it from all taxes of whatever nature, and by whatever authority,
with respect to its insulators in consideration for the payment of the
percentage tax on its gross earnings.
3. Thus review was filed.
ISSUE/S:

1.

WON the Supreme Court is bound by the findings of fact of the

Court of tax appeal - YES

RULING: Petition DISMISSED.

RATIO:
1. It is a well-settled principle that the Court is bound by the finding of facts
of the CTA, only questions of law is open to it for determination. The facts
ascertained above cannot be disturbed. There is a categorical assertion that
where the question is one of fact, it is no longer reviewable. It is a
recognition of the wide discretion enjoyed by the CTA. It is unadvisable to
the Court to set aside the conclusion reached by an agency such as the CTA
which is, by the very nature of its function, dedicated exclusively to the
study and consideration of tax problems and has necessarily developed an
expertise on the subject, unless there has been an abuse or improvement
exercise of its authority.
SUBSTANIAL PART:
1. It is true that in construction of tax statutes, tax exemptions are not
favored in the law as the principle of strictissimi juris applies, HOWEVER,
it is equally a recognized principly that where the provision of the law is
clear and unambiguous, so that there is no occasion for the courts seeking
the legislative intent, the law must be taken as it is, devoid of judicial
addition or subtraction.
2. It is explicitly expressed in the law that insulators of Meralco is exempted
from any kind of taxes. CTA also shows that insulating oil falls under the
classification of insulators as the purpose is the same, which is: for cooling
as well as for insulating machines.