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CIR
vs
Algue, Inc
And
CTA
PHILIPPINE
AIRLINES, INC
vs
ROMEO F. EDU, in
Facts
The Philippine Sugar Estate Development
Company had earlier appointed Algue as
its agent, authorizing it to sell its land,
factories and oil manufacturing process.
Pursuant to such authority, Alberto
Guevara, Jr., Eduardo Guevara, Isabel
Guevara, Edith, O'Farell, and Pablo
Sanchez, worked for the formation of the
Vegetable Oil Investment Corporation,
inducing other persons to invest in it.
Ultimately, after its incorporation largely
through the promotion of the said persons,
this new corporation purchased the PSEDC
properties.
For this sale, Algue received as agent a
commission of P126, 000.00, and it was
from this commission that the P75, 000.00
promotional fees were paid to the
aforenamed individuals.
The CIR 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 services rendered.
The payment was in the form of
promotional fees.
The Philippine Airlines (PAL) is a
corporation
engaged
in
the
air
transportation business under a legislative
franchise, Act No. 42739. Under its
franchise, PAL is exempt from the payment
of taxes.
Sometime in 1971, however, Land
Transportation Commissioner Romeo F.
Issue
Held
No. The Supreme Court agrees with the
respondent court that the amount of the
promotional fees was not excessive. The
amount of P75,000.00 was 60% of the
total commission. This was a reasonable
proportion, considering that it was the
payees who did practically everything,
from the formation of the Vegetable Oil
Investment Corporation to the actual
purchase by it of the Sugar Estate
properties.
W/N the
Collector
of
Internal Revenue correctly
disallowed the P75,000.00
deduction
claimed
by
Algue
as
legitimate
business expenses in its
income tax returns
Yes.
TAX vs LICENSE AND REGULATORY FEE
SC ruled that motor vehicles registration
fees are TAXES. Fees may be regarded as
taxes even though they also serve as
instruments of regulation because taxation
may be made as an implementation of the
States police power. But if the purpose is
his capacity as
Land
Transportation
Commissioner, and
UBALDO
CARBONELL, in his
capacity as
National Treasurer
IN THE MATTER OF
A PETITION FOR
DECLARATORY
JUDGMENT
REGARDING THE
VALIDITY OF
MUNICIPAL
ORDINANCE NO.
3659 OF THE CLTY
OF MANILA.
PHYSICAL THERAPY
ORGANIZATION OF
THE PHILIPPINES,
INC
vs.
THE MUNICIPAL
BOARD OF THE
CITY OF MANILA
and Mayor
ARSENIO H.
LACSON,
Republic
vs.
Mambulao Lumber
Francia
vs
IAC
be
or
Domingo
vs
Garlitos
DAVAO GULF
LUMBER CORP
vs
CIR
Caltex
Philippines
vs
Commission on
Audit
CIR
vs
CA and
YMCA
Whether
the
income
derived from rentals of real
property owned by YMCA
established as a welfare,
educational and charitable
non-profit
corporation
subject to income
tax under the NIRC and the
Constitution.
Pascual
vs.
Secretary of Public
Works and
Communications
Mactan Cebu
(MCIAA)
vs.
Marcos
Mactan
Cebu
International
Airport
Authority
(MCIAA)
was
created
to
principally undertake to economical,
efficient
and
effective
control,
management
and
supervision
of
the Mactan International Airport
and