BENGUET CORP.
V CENTRAL BOARD The CBAA cited, inter alia, that the object mentioned
G.R. NO. 106041 | JANUARY 29, 1993
CRUZ, J.
CAGA | GRP. 7
PETITIONER: Benguet Corporation (BengCo).
RESPONDENTS: Central Board of Assessment Appeals
(CBAA), Board of Assessment Appeals of Zambales, Provincial
Assessor of Zambales, Province of Zambales, and Municipality
of San Marcelino.
TOPIC:
Definition > Classification under the Civil Code>
Immovable or Real Property > Movable or Personal
Property.
CASE SUMMARY: A realty tax was imposed against BengCo's
tailings dam and the land thereunder. BengCo appealed the
assessment to the Board of Assessment Appeals of Zambales
which dismissed the appeal on the grounds of BengCo's failure
to pay the realty tax during the pendency of the appeal.
BengCo appealed this decision to the CBAA who reversed the
dismissal of the appeal but on the merits agreed that the
tailings dam and the land thereunder were subject to realty tax.
The CBAA cited, inter alia, that the dam comes under the ambit
of Art. 415 (1) and (2) hence it is taxable under Sec. 38 of PD
464. Thus BengCo appealed to the SC. According to BengCo,
the tailings dam is not subject to a separate tax (from the mine
from which the dam is connected) because it is not an
"improvement" upon the land within the meaning of PD 464. SC
dismissed this petition. Stating that the tailings dam is taxable
because: 1) it is covered by Art. 415 (3); and 2) it is an
improvement according to Sec. 3 (k) of PD 464. " Improvements
is a valueable addition made to property or an amelioration in its
condition, amounting to more than more repairs or replacement
of waste, costing labor or capital, and intended to enhance its
value, beauty or utility or to adapt it for new or further purposes."
TERMS:
Tailings Dam is typically an earth-filled
embankment dam used to store byproducts of mining
operations after separating the ore from the rest.
PRECEDENTS: n/a
FACTS:
A realty tax, assessed by the Provincial Assessor of
Zambales at P11,319,304.00, was imposed against
Benguet Corporation's (BengCo) tailings dam and the
land thereunder.
BengCo appealed the assessment to the Board of
Assessment Appeals of Zambales which dismissed
the appeal on the grounds of BengCo's failure to pay
the realty tax during the pendency of the appeal.
BengCo appealed this decision to the CBAA who
reversed the dismissal of the appeal but on the merits
agreed that the tailings dam and the land thereunder
were subject to realty tax.
comes under the ambit of Art. 415 (1) and (2) hence it
is taxable under Sec. 38 of PD 464. Thus this appeal.
ISSUES:
WON the tailings dam is an "improvement" on the
mine of BengCo. (Thus making it taxable under PD
464)
RULING: YES. The Dam is an improvement
According to the Petitioner, they should not have
been assessed a separate tax for the tailings dam
and the land thereunder because the said object is
not an improvement on the mine of BengCo.
Sec. 38 of PD 464 is silent about what constitutes a
real property so the Court used the definition provided
by Art. 415 of the NCC.
SC ruled that said tailings dam is under Art. 415 (3)
SC also looked at the definition of an improvement.
Sec. 3 (k) of PD 464 was used as basis. It found that
the degree of permanence in its intended construction
and use is what defines an improvement so as to
constitute it as a realty.
SC ruled that since the dam is an integral part of the
mine and increases its utility thus it is an
improvement, hence, taxable.
DISPOSITIVE: WHEREFORE, the petition is dismissed for
failure to show that the questioned decision of [CBAA] is tainted
with grave abuse of discretion except as to the imposition of
penalties upon the petitioner which is hereby set aside. Costs
against petitioner. It is so ordered.
PROVISIONS:
Art. 415 NCC. The following are immovable property:
1) Land, building, roads and constructions of all kinds
adhered to the soil;
2) Trees, plants, and growing fruits, while they are
attached to the land or form an integral part of an
immovable;
3) Everything attached to an immovable in a fixed
manner, in such a way that it cannot be separated
therefrom without breaking the material or
deterioration of the object;
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Sec. 38 of PD 464 (The Real Property Tax Code).
Incidence of Real Property Tax. There shall be levied,
assessed and collected in all provinces, cities and
municipalities an annual ad valorem tax on real property,
such as land, buildings, machinery and other improvements
affixed or attached to real property not hereinafter
specifically exempted.
Sec. 3 of PD 464. Definition of Terms. When used in this
Code:
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(k) Improvements is a valueable addition made to property
or an amelioration in its condition, amounting to more than
more repairs or replacement of waste, costing labor or
capital, and intended to enhance its value, beauty or utility
or to adapt it for new or further purposes.
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