GR No.

175723, 04 February 2014

CITY OF MANILA v. HON. GRECIA-CUERDO, SM, STAR APPLIANCE CENTER, SUPERVALUE,

INC., ACE HARDWARE, WATSON, JOLLIMART, SURPLUS

FACTS:

Petitioner City of Manila, through its treasurer, petitioner Liberty Toledo, assessed taxes for the taxable
period from January to December 2002 against private. respondents. In addition to the taxes purportedly
due from private respondents, pursuant to Sections 14, 15, 16, 17 of the Revised Revenue Code of
Manila (RRCM), said assessment covered the local business taxes petitioners were authorized to collect
under Section 21 of the same Code. Because payment of the taxes assessed was a precondition for the
issuance of their business permits, private respondents were constrained to pay the P19,316,458.77
assessment under protest.

On January 24, 2004, private respondents filed with the RTC of Pasay City the complaint denominated as
one for "Refund or Recovery of Illegally and/or Erroneously-Collected Local Business Tax,
Prohibition with Prayer to Issue TRO and Writ of Preliminary Injunction" which was docketed
as Civil Case No. 040019-CFM before public respondent's sala. In the amended complaint, private
respondents alleged that the provisions of the RRCM were violative of the limitations and guidelines
under Section 143 (h) of Republic Act No. 7160 [Local Government Code] on double taxation. They
further averred that petitioner city's Ordinance No. 8011 which amended pertinent portions of the RRCM
had already been declared to be illegal and unconstitutional by the Department of Justice.

RTC granted private respondents application for a writ of preliminary injunction and denied the latters
Motion for Reconsideration. CA dismissed petitioners' petition for certiorari holding that it has no
jurisdiction over the said petition. The CA ruled that since appellate jurisdiction over private respondents'
complaint for tax refund, which was filed with the RTC, is vested in the Court of Tax Appeals (CTA),
pursuant to its expanded jurisdiction under Republic Act No. 9282 (RA 9282), it follows that a petition for
certiorari seeking nullification of an interlocutory order issued in the said case should, likewise, be filed
with the CTA. Ca likewise denied petitioners Motion for Reconsideration.

ISSUE: Whether or not the CTA has jurisdiction over a special civil action for certiorari assailing an
interlocutory order issued by the RTC in a local tax case.

HELD: YES.

On March 30, 2004, the Legislature passed into law Republic Act No. 9282 (RA 9282) amending RA 1125
by expanding the jurisdiction of the CTA, enlarging its membership and elevating its rank to the level of a
collegiate court with special jurisdiction. Pertinent portions of the amendatory act provides thus:

Sec. 7. Jurisdiction The CTA shall exercise:

a. Exclusive appellate jurisdiction to review by appeal, as herein provided:

Xxx
3. Decisions, orders or resolutions of the Regional Trial Courts in local tax
cases originally decided or resolved by them in the exercise of their
original or jurisdiction;
Xxx

The prevailing doctrine is that the authority to issue writs of certiorari involves the exercise of original
jurisdiction which must be expressly conferred by the Constitution or by law and cannot be implied from
the mere existence of appellate jurisdiction. While there is no express grant of such power, with respect
to the CTA, Section 1, Article VIII of the 1987 Constitution provides, nonetheless, that judicial power shall
be vested in one Supreme Court and in such lower courts as may be established by law and that judicial
power includes the duty of the courts of justice to settle actual controversies involving rights which are
legally demandable and enforceable, and to determine whether or not there has been a grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the
Government.

Indeed, in order for any appellate court, to effectively exercise its appellate jurisdiction, it
must have the authority to issue, among others, a writ of certiorari. In transferring exclusive
jurisdiction over appealed tax cases to the CTA, it can reasonably be assumed that the law
intended to transfer also such power as is deemed necessary, if not indispensable, in aid of
such appellate jurisdiction. This Court has held as early as the case of JM Tuason v Jaramillo et al
that "if a case may be appealed to a particular court or judicial tribunal or body, then said
court or judicial tribunal or body has jurisdiction to issue the extraordinary writ of certiorari,
in aid of its appellate jurisdiction." This principle was affirmed in De Jesus v CA where the Court
stated that "a court may issue a writ of certiorari in aid of its appellate jurisdiction if said
court has jurisdiction to review, by appeal or writ of error, the final orders or decisions of the
lower court."
If this Court were to sustain petitioners' contention that jurisdiction over their certiorari petition lies with
the CA, this Court would be confirming the exercise by two judicial bodies, the CA and the CTA, of
jurisdiction over basically the same subject matter precisely the split-jurisdiction situation which is
anathema to the orderly administration of justice. Thus, the Court agrees with the ruling of the CA
that since appellate jurisdiction over private respondents' complaint for tax refund is vested
in the CTA, it follows that a petition for certiorari seeking nullification of an interlocutory
order issued in the said case should, likewise, be filed with the same court. To rule otherwise
would lead to an absurd situation where one court decides an appeal in the main case while another
court rules on an incident in the very same case.

FALLO: Petition is DENIED.

Take Note: 1. The case was moot and academic. Court discovered that a Decision in the main case
had already been rendered by the RTC on August 13, 2007 which ordered the defendant to grant
tax refund or credit and enjoined it from collecting taxes under Sec. 21 of the RRCM. The
decision was already final and executory. Nevertheless, the Court found it necessary to resolve
the issue on jurisdiction.

2. Petitioners availed of the wrong remedy when they filed the instant special civil
action for certiorari under Rule 65 of the Rules of Court in assailing the Resolutions of the CA
which dismissed their petition filed with the said court and their motion for reconsideration of
such dismissal. The assailed Resolutions of the CA are in the nature of a final order as they
disposed of the petition completely. It is settled that in cases where an assailed judgment or
order is considered final, the remedy of the aggrieved party is appeal. Hence, in the instant case,
petitioner should have filed a petition for review on certiorari under Rule 45, which is a
continuation of the appellate process over the original case.

Considering that the present petition was filed within the 15-day reglementary period for
filing a petition for review on certiorari under Rule 45, that an error of judgment is averred, and
because of the significance of the issue on jurisdiction, the Court deems it proper and justified to
relax the rules and, thus, treat the instant petition for certiorari as a petition for review on
certiorari.