GR L 13819; (May, 1960) (Digest)
G.R. No. L-13819; May 25, 1960
THE COLLECTOR OF INTERNAL REVENUE, petitioner, vs. BLAS GUTIERREZ and MARIA MORALES, respondents.
FACTS
The Collector of Internal Revenue assessed Blas Gutierrez and Maria Morales for a deficiency income tax of P8,481.00 for 1950. The respondents appealed to the Court of Tax Appeals (CTA). In its decision dated August 31, 1955, the CTA modified the assessment and held the respondents liable only for the amount of P5,654.00 as deficiency income tax. Both parties appealed to the Supreme Court, which affirmed the CTA’s decision. After the Supreme Court’s decision became final, the Collector filed a motion for execution in the CTA, seeking to collect not only the P5,654.00 but also a 5% surcharge and 1% monthly interest from the due date, pursuant to Section 51(e) of the National Internal Revenue Code. The CTA granted the motion for execution but limited it to the satisfaction of the judgment amount of P5,654.00 only, refusing to include the surcharge and interest. The Collector appealed this resolution.
ISSUE
Whether the Collector of Internal Revenue can collect, through a writ of execution, the 5% surcharge and 1% monthly interest on the deficiency income tax of P5,654.00, when the final and executory decision of the Court of Tax Appeals ordered the payment of “the sum of P5,654.00 as deficiency income tax” and made no express provision for such surcharge and interest.
RULING
No. The Supreme Court affirmed the resolution of the Court of Tax Appeals. The Court held that the writ of execution must conform strictly to the terms of the judgment it seeks to enforce and cannot vary or exceed that judgment. The dispositive portion of the CTA’s final and affirmed decision specifically ordered the respondents to pay “the sum of P5,654.00 as deficiency income tax, with costs against the petitioners,” with no pronouncement on surcharge and interest. Therefore, the execution could not validly require the collection of an additional amount. The Court rejected the Collector’s argument that the surcharge and interest were implied in the judgment or were mandatory and self-executory under the Tax Code. It ruled that the original tax claim, including any issues regarding surcharges and interest, had been merged into and replaced by the final judgment after being fully litigated. The Collector’s proper remedy was to appeal the judgment for its failure to include the surcharge and interest, which he did not do. Consequently, only the amount expressly awarded in the judgment could be enforced.