G.R. No. L-16683; January 31, 1962
ROMAN CATHOLIC ARCHBISHOP OF CEBU, petitioner, vs. THE COLLECTOR OF INTERNAL REVENUE, respondent.

FACTS

The Roman Catholic Archbishop of Cebu filed income tax returns for 1955 and 1956, claiming deductions for depreciation on church properties like the Archbishop’s Palace and seminaries. The Collector of Internal Revenue disallowed these deductions entirely, asserting the income was realized independently of the use of those assets, leading to deficiency assessments. The petitioner protested these assessments multiple times. To prevent the sale of church properties under a warrant of distraint and levy, the petitioner paid the total tax amount under protest on February 7, 1958. Subsequently, the petitioner filed a petition for review with the Court of Tax Appeals (CTA) on February 1, 1958, challenging the assessments.
The Collector moved to dismiss the appeal, arguing the CTA lacked jurisdiction because the petitioner failed to file a formal claim for refund as required by the Tax Code. The CTA agreed and dismissed the appeal. The petitioner then elevated the case to the Supreme Court, contending the appeal involved a “disputed assessment” under Republic Act No. 1125 , not a claim for refund, making the prior filing of a refund claim unnecessary.

ISSUE

Whether the Court of Tax Appeals correctly dismissed the petitioner’s appeal for lack of jurisdiction due to the failure to file a claim for refund, and whether the appeal was filed within the prescribed period.

RULING

The Supreme Court held that the CTA had jurisdiction. The case involved a “disputed assessment” under Section 7 of Republic Act No. 1125 , not a claim for refund. The petitioner had consistently protested the assessments from the outset, and the payment under protest was made solely to avoid the coercive distraint of church properties. Requiring a separate refund claim after such a payment would be a useless formality, as the Collector would inevitably deny it on the same grounds. The law should not be interpreted to lead to such absurdities.
However, the Supreme Court affirmed the dismissal of the appeal on a different, substantive ground: it was filed out of time. The 30-day appeal period under Section 11 of Republic Act No. 1125 began to run from November 21, 1957, when the petitioner received the Collector’s denial of its second request for reconsideration. The petitioner’s third request for reconsideration, filed on November 23, 1957, did not present new grounds and was merely pro forma; thus, it did not interrupt the running of the appeal period. The petition for review filed on February 1, 1958, was therefore filed beyond the December 21, 1957, deadline. The Court emphasized that taxpayers cannot indefinitely delay the finality of tax assessments through successive reconsideration requests on the same grounds, as the prompt collection of taxes is essential to government operations.