GR L 46245; (May, 1982) (Digest)
G.R. No. L-46245 May 31, 1982
MERALCO SECURITIES INDUSTRIAL CORPORATION, petitioner, vs. CENTRAL BOARD OF ASSESSMENT APPEALS, BOARD OF ASSESSMENT APPEALS OF LAGUNA and PROVINCIAL ASSESSOR OF LAGUNA, respondents.
FACTS
Meralco Securities Industrial Corporation installed a steel pipeline system from Batangas to Manila, buried underground, pursuant to a concession under the Petroleum Act. The Laguna portion spanned about thirty kilometers. The pipes were welded together and embedded in the soil, laid beneath riverbeds, and were intended to be permanent, though the government’s permit reserved the right to require their removal at the concessionaire’s expense for road repairs. The Provincial Assessor of Laguna issued tax declarations for the pipeline as real property.
Meralco Securities appealed to the Board of Assessment Appeals of Laguna, which upheld the assessment. The Central Board of Assessment Appeals affirmed, ruling the pipeline was subject to realty tax. Meralco Securities filed a motion for reconsideration, which was denied. It then filed this petition for certiorari, arguing the Court of Tax Appeals lacked jurisdiction to review the Board’s decision and that no statutory judicial review was provided, making certiorari its only recourse.
ISSUE
Whether the petition for certiorari is the proper remedy to assail the decision of the Central Board of Assessment Appeals, and whether the Board committed grave abuse of discretion in ruling that the pipeline is subject to real property tax.
RULING
The Supreme Court held that certiorari was properly availed of. While no statutory right of review was provided, courts possess the inherent power to scrutinize acts of administrative agencies exercising quasi-judicial functions on questions of law and jurisdiction to prevent arbitrary adjudications and protect substantial rights. Judicial review is proper in cases of lack of jurisdiction, error of law, or grave abuse of discretion.
On the merits, the Court found no grave abuse of discretion by the Board. The pipeline, being permanently attached to the land and constituting a valuable improvement, qualifies as real property under the Assessment Law and the Real Property Tax Code. The Court rejected the argument that the realty tax was a prohibited “local tax or levy” under the Petroleum Act’s tax exemption clause. The realty tax is a tax of general application imposed nationwide by national law, not a local tax enacted by a municipal or city council. Therefore, the Board acted within its jurisdiction and committed no error. The petition was dismissed.