ATLAS CONSOLIDATED MINING AND DEVELOPMENT CORPORATION, Petitioner, versus, COMMISSIONER OF INTERNAL REVENUE, Respondent.

FACTS: Under Section 100 of the Tax Code of the Philippines, petitioner is a zero-rated al!e Added Tax " AT# person for $ein% an exporter of copper concentrates. Accordin% to petitioner, on &an!ar' (0, 1))*, it filed its AT ret!rn for the fo!rth +!arter of 1)),, sho-in% a total inp!t tax of P./,,00/,)/,.1* and an excess AT credit of P.*(,,,/,()1./0 and, on &an!ar' (0, 1))/, it applied for a tax ref!nd or a tax credit certificate for the latter a2o!nt -ith respondent Co22issioner of 3nternal Re4en!e "C3R#. 5n the sa2e date, petitioner filed the sa2e clai2 for ref!nd -ith the Co!rt of Tax Appeals "CTA#, clai2in% that the t-o-'ear prescripti4e period pro4ided for !nder Section (,0 of the Tax Code for clai2in% a ref!nd -as a$o!t to expire. The C3R failed to file his ans-er -ith the CTA6 th!s, the for2er declared the latter in defa!lt. CTA rendered its 7ecision8,9 den'in% petitioner:s clai2 for ref!nd d!e to petitioner:s fail!re to co2pl' -ith the doc!2entar' re+!ire2ents prescri$ed !nder Section 1/ of Re4en!e Re%!lations ;o. 0.1, as a2ended $' Re4en!e Re%!lations ;o. ,-.., dated April 1, 1)... The CTA:s 7ecision and Resol!tion -ere +!estioned in the CA. <o-e4er, the CA affir2ed in toto the said 7ecision and Resol!tion. 3SSU=: >hether or not petitioner 2a' clai2 tax ref!nd. <=?7: This Co!rt is, therefore, $o!nd $' the fore%oin% facts, as fo!nd $' the appellate co!rt, for -ell-settled is the %eneral r!le that the @!risdiction of this Co!rt in cases $ro!%ht $efore it fro2 the Co!rt of Appeals, $' -a' of a Petition for Re4ie- on Certiorari !nder R!le *0 of the Re4ised R!les of Co!rt, is li2ited to re4ie-in% or re4isin% errors of la-6 findin%s of fact of the latter are concl!si4e. This Co!rt is not a trier of facts. 3t is not its f!nction to re4ie-, exa2ine and e4al!ate or -ei%h the pro$ati4e 4al!e of the e4idence presented. 3t 2!st $e re2e2$ered that -hen clai2in% tax ref!ndAcredit, the AT-re%istered taxpa'er 2!st $e a$le to esta$lish that it does ha4e ref!nda$le or credita$le inp!t AT, and the sa2e has not $een applied a%ainst its o!tp!t AT lia$ilitiesBinfor2ation -hich are s!pposed to $e reflected in the taxpa'erCs AT ret!rns. Th!s, an application for tax ref!ndAcredit 2!st $e acco2panied $' copies of the taxpa'erCs AT ret!rnAs for the taxa$le +!arterAs concerned. The for2al offer of e4idence of the petitioner failed to incl!de photocop' of its export doc!2ents, as re+!ired. There is no -a' therefore, in deter2inin% the Dind of %oods and act!al a2o!nt of export sales it alle%edl' 2ade d!rin% the +!arter in4ol4ed. This findin% is 4er' cr!cial -hen -e tr' to relate it -ith the re+!ire2ent of the afore2entioned re%!lations that the inp!t tax $ein% clai2ed for ref!nd or tax credit 2!st $e sho-n to $e entirel' attri$!ta$le to the zero-rated transaction, in this case, export sales of %oods. >itho!t the export doc!2ents, the p!rchase in4oiceAreceipts s!$2itted $' the petitioner as proof of its inp!t taxes cannot $e 4erified as $ein% directl' attri$!ta$le to the %oods so exported. Taxation is a destr!cti4e po-er -hich interferes -ith the personal and propert' ri%hts of the people and taDes fro2 the2 a portion of their propert' for the s!pport of the %o4ern2ent. And, since taxes are -hat -e pa' for ci4ilized societ', or are the life$lood of the nation, the la- fro-ns a%ainst exe2ptions fro2 taxation and stat!tes %rantin% tax exe2ptions are th!s constr!ed strictissi2i @!ris a%ainst the taxpa'er and li$erall' in fa4or of the taxin% a!thorit'. A clai2 of ref!nd or exe2ption fro2 tax

pa'2ents 2!st $e clearl' sho-n and $e $ased on lan%!a%e in the la- too plain to $e 2istaDen. =lse-ise stated, taxation is the r!le, exe2ption therefro2 is the exception. WHEREFORE, the Petition is here$' DENIED for lacD of 2erit. The 7ecision and Resol!tion of the Co!rt of Appeals, dated April 1), (001 and A!%!st /, (00,, respecti4el', are here$' AFFIRMED.

PHILAM ASSET MANAGEMENT, INC., versus, COMMISSIONER OF INTERNAL REVENUE ;ATUR=: These are t-o consolidated Petitions for Re4ie- 819 !nder R!le *0 of the R!les of Co!rt, seeDin% to re4ie- and re4erse the 7ece2$er 1), (00( 7ecision 8(9 of the Co!rt of Appeals "CA# in CA-ER SP ;o. /)1)1 and its &an!ar' ,0, (00* 7ecision8,9 in CA-ER SP ;o. 10..(. FACTS: FPetitioner, for2erl' Phila2 F!nd Gana%e2ent, 3nc., is a do2estic corporation d!l' or%anized and existin% !nder the la-s of the Rep!$lic of the Philippines. 3t acts as the in4est2ent 2ana%er of $oth Philippine F!nd, 3nc. "PF3# and Phila2 Hond F!nd, 3nc. "PHF3#, -hich are open-end in4est2ent co2panies8,9 in the sale of their shares of stocDs and in the in4est2ent of the proceeds of these sales into a di4ersified portfolio of de$t and e+!it' sec!rities. Hein% an in4est2ent 2ana%er, petitioner pro4ides 2ana%e2ent and technical ser4ices to PF3 and PHF3. Petitioner is, liDe-ise, PF3Cs and PHF3Cs principal distri$!tor -hich taDes char%e of the sales of said co2paniesC shares to prospecti4e in4estors. P!rs!ant to the separate 829ana%e2ent and 8d9istri$!tion a%ree2ents $et-een the 8p9etitioner and PF3 and PHF3, $oth PF3 and PHF3 8a%ree9 to pa' the 8p9etitioner, $' -a' of co2pensation for the latterCs ser4ices and facilities, a 2onthl' 2ana%e2ent fee fro2 -hich PF3 and PHF3 -ithhold the a2o!nt e+!i4alent to 8a9 fi4e percent "0I# credita$le tax8,9 p!rs!ant to the =xpanded >ithholdin% Tax Re%!lations. Petitioner filed its ann!al corporate inco2e tax ret!rn for the taxa$le 'ear 1))1 representin% net loss. Conse+!entl', it failed to !tilize the credita$le tax -ithheld representin% the tax -ithheld $' petitionerCs -ithholdin% a%ents, PF3 and PHF3, on professional fees. Petitioner filed an ad2inistrati4e clai2 for ref!nd -ith the H3R Appellate 7i4ision for a2o!nt representin% !n!tilized excess tax credits for calendar 'ear 1))1. Thereafter, on &!l' (., 1))), a -ritten re+!est -as filed -ith the sa2e di4ision for the earl' resol!tion of petitionerCs clai2 for ref!nd. Respondent did not act on petitionerCs clai2 for ref!nd6 hence, a Petition for Re4ie- -as filed -ith the S!pre2e Co!rt on ;o4e2$er (), 1))) to toll the r!nnin% of the t-o-'ear prescripti4e period.J 3SSU=: >hether petitioner is entitled to a ref!nd of its credita$le taxes -ithheld for taxa$le 'ears 1))1 and 1)). <=?7: The Petition in ER ;o. 10//,1 is 2eritorio!s, $!t that in ER ;o. 1/(00* is not. The pro4ision on the final ad@!st2ent ret!rn "FAR# -as ori%inall' fo!nd in Section /) of Presidential 7ecree "P7# ;o. 110., other-ise Dno-n as the F;ational 3nternal Re4en!e Code of 1)11.J 5n A!%!st 1, 1).0, this pro4ision -as restated as Section ./ in P7 1100. 5n ;o4e2$er 0, 1).0, all prior a2end2ents and those introd!ced $' P7 1))* -ere codified into the ;ational 3nternal Re4en!e Code ";3RC# of 1).0, as a res!lt of -hich Section ./ -as ren!2$ered as Section 1).

5n &!l' ,1, 1)./, Section (* of =xec!ti4e 5rder "=5# ;o. ,1 chan%ed all Fnet inco2eJ phrases appearin% in Title 33 of the ;3RC of 1)11 to Ftaxa$le inco2e.J Section 1) of the ;3RC of 1).0 ho-e4er, -as not a2ended. 5n &!l' (0, 1).1, =5 (1, ren!2$ered Section ./ of the ;3RC as Section 1/, -hich -as also rearran%ed to fall !nder Chapter 10 of Title 33 of the ;3RC. Section 1), -hich had earlier $een ren!2$ered $' P7 1))*, re2ained !nchan%ed. Th!s, Section /) of the ;3RC of 1)11 -as ren!2$ered as Section ./ !nder P7 11006 later, as Section 1) !nder P7 1))*6 then, as Section 1/ !nder =5 (1,. Finall', after $ein% ren!2$ered and red!ced to the chaff of a %rain, Section /) -as repealed $' =5 ,1. S!$se+!entl', Section /) reappeared in the ;3RC "or Tax Code# of 1))1 as Section 1/. GR No. 156637 This section applies to the first case $efore the Co!rt. 7ifferentl' n!2$ered in 1)11 $!t si2ilarl' -orded (0 'ears later "1))1#, Section 1/ offers t-o options to a taxa$le corporation -hose total +!arterl' inco2e tax pa'2ents in a %i4en taxa$le 'ear exceeds its total inco2e tax d!e. These options are "1# filin% for a tax refund or "(# a4ailin% of a tax credit. The first option is relati4el' si2ple. An' tax on inco2e that is paid in excess of the a2o!nt d!e the %o4ern2ent 2a' $e ref!nded, pro4ided that a taxpa'er properl' applies for the ref!nd. The second option -orDs $' appl'in% the ref!nda$le a2o!nt, as sho-n on the FAR of a %i4en taxa$le 'ear, a%ainst the esti2ated +!arterl' inco2e tax lia$ilities of the s!cceedin% taxa$le 'ear. These t-o options !nder Section 1/ are alternati4e in nat!re. The choice of one precl!des the other. 3ndeed, in Philippine Bank of Communications v. Commissioner of Internal Revenue , the Co!rt r!led that a corporation 2!st si%nif' its intention -- -hether to re+!est a tax refund or clai2 a tax credit -- $' 2arDin% the correspondin% option $ox pro4ided in the FAR. >hile a taxpa'er is re+!ired to 2arD its choice in the for2 pro4ided $' the H3R, this re+!ire2ent is onl' for the p!rpose of facilitatin% tax collection. 5ne cannot %et a tax refund and a tax credit at the sa2e ti2e for the sa2e excess inco2e taxes paid. Fail!re to si%nif' oneCs intention in the FAR does not 2ean o!tri%ht $arrin% of a 4alid re+!est for a ref!nd, sho!ld one still choose this option later on. A tax credit sho!ld $e constr!ed 2erel' as an alternati4e re2ed' to a tax ref!nd !nder Section 1/, s!$@ect to prior 4erification and appro4al $' respondent. The reason for re+!irin% that a choice $e 2ade in the FAR !pon its filin% is to ease tax ad2inistration, partic!larl' the self-assess2ent and collection aspects. A taxpa'er that 2aDes a choice expresses certaint' or preference and th!s de2onstrates clear dili%ence. Con4ersel', a taxpa'er that 2aDes no choice expresses !ncertaint' or lacD of preference and hence sho-s si2ple ne%li%ence or plain o4ersi%ht. 3n the present case, respondent denied the clai2 of petitioner for a ref!nd of excess taxes -ithheld in 1))1, $eca!se the latter "1# had not indicated in its 3TR for that 'ear -hether it -as optin% for a credit or a ref!nd6 and "(# had not s!$2itted as e4idence its 1)). 3TR, -hich co!ld ha4e $een the $asis for deter2inin% -hether its clai2ed 1))1 tax credit had not $een applied a%ainst its 1)). tax lia$ilities. 3n the present case, altho!%h petitioner did not 2arD the ref!nd $ox in its 1))1 FAR, neither did it perfor2 an' act indicatin% that it chose a tax credit. 5n the contrar', it filed on Septe2$er 11, 1))., an

ad2inistrati4e clai2 for the ref!nd of its excess taxes -ithheld in 1))1. 3n none of its +!arterl' ret!rns for 1)). did it appl' the excess credita$le taxes. Under these circ!2stances, petitioner is entitled to a tax refund of its 1))1 excess tax credits. GR No. 162004 As to the second case, Section 1/ also applies. A2ended $' Rep!$lic Act "RA# ;o. .*(*, other-ise Dno-n as the FTax Refor2 Act of 1))1.J The carr'-o4er option !nder Section 1/ is per2issi4e. A corporation that is entitled to a tax refund or a tax credit for excess pa'2ent of +!arterl' inco2e taxes 2a' carr' o4er and credit the excess inco2e taxes paid in a %i4en taxa$le 'ear a%ainst the esti2ated inco2e tax lia$ilities of the s!cceedin% +!arters. 5nce chosen, the carr'-o4er option shall $e considered irre4oca$le for that taxa$le period, and no application for a tax refundor iss!ance of a tax credit certificate shall then $e allo-ed. Accordin% to petitioner, it neither chose nor 2arDed the carr'-o4er option $ox in its 1)). FAR. As this option -as not chosen, it see2s that there is nothin% that can $e considered irre4oca$le. 3n other -ords, petitioner ar%!es that it is still entitled to a ref!nd of its 1)). excess inco2e tax pa'2ents. This ar%!2ent does not hold -ater. The s!$se+!ent acts of petitioner re4eal that it has effectively chosen the carr'-o4er option. >hether the F3F5 principle is applied or not, Section 1/ re2ains clear and !ne+!i4ocal. 5nce the carr'-o4er option is taDen, act!all' or constr!cti4el', it $eco2es irrevocable. Petitioner has chosen that option for its 1)). credita$le -ithholdin% taxes. Th!s, it is no lon%er entitled to a tax refund of P*0),10/.01, -hich corresponds to its 1)). excess tax credit. ;onetheless, the a2o!nt -ill not $e forfeited in the %o4ern2entCs fa4or, $eca!se it 2a' $e clai2ed $' petitioner as tax credits in the s!cceedin% taxa$le 'ears. ><=R=F5R=, the Petition in ER ;o. 10//,1 is GRANTED and the assailed 7ece2$er 1), (00( 7ecision REVERSED and SET ASIDE. ;o prono!nce2ent as to costs. The Petition in ER ;o. 1/(00* is, ho-e4er, DENIED and the assailed &an!ar' ,0, (00* 7ecision AFFIRMED. Costs a%ainst petitioner.

SOUTHERN PHILIPPINES POWER CORPORATION, versus INTERNAL REVENUE FACTS:

, COMMISSION OF

Petitioner So!thern Philippines Po-er Corporation "SPP#, a po-er co2pan' that %enerates and sells electricit' to the ;ational Po-er Corporation ";PC#, applied -ith the H!rea! of 3nternal Re4en!e "H3R# for zero-ratin% of its transactions !nder Section 10."H#",# of the ;ational 3nternal Re4en!e Code ";3RC#. The H3R appro4ed the application for taxa$le 'ears 1))) and (000. 5n &!ne (0, (000 SPP filed a clai2 -ith respondent Co22issioner of 3nternal Re4en!e "C3R# for a tax credit or ref!nd for 1))). 5n &!l' 1,, (001 SPP filed a second clai2 in tax credit or ref!nd for (000. The a2o!nts represented !n!tilized inp!t AT attri$!ta$le to SPPCs zero-rated sale of electricit' to ;PC. 5n Septe2$er (), (001, $efore the lapse of the t-o-'ear prescripti4e period for s!ch actions, SPP filed -ith the Co!rt of Tax Appeals "CTA# Second 7i4ision a petition for re4ie- co4erin% its clai2s for ref!nd or tax credit. The petition clai2ed onl' the a%%re%ate a2o!nt -hich co4ered the last t-o +!arters of 1))) and the fo!r +!arters in (000. 3n a 7ecision dated April (/, (00/, the Second 7i4ision denied SPPCs clai2s, holdin% that its zerorated official receipts did not correspond to the +!arterl' AT ret!rns, $earin% a difference. 3SSU=:

>hether or not the CTA En Banc correctl' r!led that SPP -as not entitled to a tax ref!nd or credit. <=?7: The CTA denied SPPCs clai2 o!tri%ht for fail!re to esta$lish the existence of zero-rated sales, disre%ardin% SPPCs sales in4oices and receipts -hich e4idence the2. That co!rt did not del4e into the +!estion of SPPCs co2pliance -ith the other re+!isites pro4ided !nder Section 11( of the ;3RC. Conse+!entl', e4en as the Co!rt holds that SPPCs sales in4oices and receipts -o!ld $e s!fficient to pro4e its zero-rated transactions, the case has to $e re2anded to the CTA for deter2ination of -hether or not SPP has co2plied -ith the other re+!isites 2entioned. S!ch 2atter in4ol4es +!estions of fact and entails the need to exa2ine the records. The Co!rt is not a trier of facts and the co2petence needed for exa2inin% the rele4ant acco!ntin% $ooDs or records is !ndo!$tedl' -ith the CTA. WHEREFORE, the Co!rt GRANTS the petition, SETS ASIDE the Co!rt of Tax Appeals En Banc decision dated &!l' ,1, (001 and resol!tion dated Septe2$er 1), (001, and REMANDS the case to the Co!rt of Tax Appeals Second 7i4ision for f!rther hearin% as stated a$o4e.

REPUBLIC OF THE PHILIPPINES, Petitioner, 4s. JUANITO MANIMTIM, JULIO UMALI, represen e! "# AURORA U. JUMARANG, SPOUSES EDILBERTO BA$ANOLA %n! SOFIA BA$ANOLA, &ENAIDA MALABANAN, MARCELINO MENDO&A, DEMETRIO BARRIENTOS, FLORITA CUADRA, %n! FRANCISCA MANIMTIM, Respondents. FACTS: &!anito Gani2ti2, &!lio U2ali, Spo!ses =dil$erto HaKanola and Sofia HaKanola, Lenaida Gala$anan, Garcelino Gendoza, 7e2etrio Harrientos, Florita C!adra, and Francisca Gani2ti2 (respondents filed -ith the RTC t-o applications for re%istration and confir2ation of their title o4er t-o "(# parcels of land located in Haran%a' S!n%a', Ta%a'ta' Cit'. &!lio U2ali died -hile the case -as pendin% and he -as s!$stit!ted $' his heirs na2el': E!iller2o, &ose, Eerardo, Ge'nardo, &acinto, and =rnesto, all s!rna2ed U2ali, and A!rora U2ali-&!2aran%. The respondents alle%ed that the' are the o-ners pro indiviso and in fee si2ple of the s!$@ect parcels of land6 that the' ha4e ac+!ired the s!$@ect parcels of land $' p!rchase or assi%n2ent of ri%hts6 and that the' ha4e $een in act!al, open, p!$lic, and contin!o!s possession of the s!$@ect land !nder clai2 of title excl!si4e of an' other ri%hts and ad4erse to all other clai2ants $' the2sel4es and thro!%h their predecessors-in-interest since ti2e i22e2orial. 3n s!pport of their applications, the respondents s!$2itted $l!eprint plans of ?ot ,.01 and ?ot ,.0., technical descriptions, certifications in lie! of lost %eodetic en%ineerCs certificates, declarations of real propert' tax, official receipts of pa'2ent of taxes, real propert' tax certifications, and deeds of a$sol!te sale. The ?and Re%istration A!thorit' "?RA# trans2itted to the RTC a report dated April (), 1))( statin% that there -ere discrepancies in Plans and referred the 2atter to the ?and Gana%e2ent Sector "?GS#, no- called the ?and Gana%e2ent H!rea! of the 7epart2ent of =n4iron2ent and ;at!ral Reso!rces "7=;R#, for 4erification and correction. Goldex Realt', 3nc. "G5?7=M# opposed the applications on the %ro!nd that it is the re%istered o-ner of a parcel of land desi%nated and that the 2etes and $o!nds of ?ot ,.01 and ?ot ,.0. o4erlapped its lot $' a$o!t 1*,0.. s+!are 2eters. G5?7=M, therefore, pra'ed that the o4erlappin% portion $e excl!ded fro2 the applications. The respondents and G5?7=M filed a @oint 2otion re+!estin% the RTC to appoint a tea2 of co22issioners co2posed of a %o4ern2ent representati4e fro2 the S!r4e' 7i4ision, ?GS, 7=;R6 =n%r. i4encio ?. alerio, representin% the respondents6 and =n%r. Ro2eo 7!rante, representin% G5?7=M, to cond!ct an act!al %ro!nd 4erification and relocation s!r4e' to assist the RTC in resol4in% the contro4ers' on the location and position of the s!$@ect lots. 5n that sa2e da', the RTC %ranted the @oint 2otion and directed the tea2 of co22issioners to s!$2it its findin%s -ithin 10 da's after the

ter2ination of the %ro!nd 4erification and relocation s!r4e'. Thereafter, Ro$ert C. Pan%'arihan, the Chief of S!r4e' 7i4ision, ?GS, 7=;R, trans2itted to the RTC the report of =n%r. Alexander ?. &aco$ "=n%r. &aco$#, $ased on the 4erification and relocation s!r4e' he cond!cted in the presence of the respondents and G5?7=M, -hich fo!nd an encroach2ent or o4erlappin%. RTC handed do-n its &!d%2ent %rantin% the respondentsC application for re%istration of ?ot ,.01 $!t deferred the appro4al of re%istration of ?ot ,.0. pendin% the se%re%ation of *,(*, s+!are 2eter portion thereof -hich -as fo!nd to $elon% to G5?7=M. 3SSU=: >hether or not tax declarations and tax receipts are s!fficient e4idence to deter2ine o-nership of the propert' in +!estion. <=?7: The records failed to sho- that the respondents $' the2sel4es or thro!%h their predecessors-ininterest ha4e $een in open, excl!si4e, contin!o!s, and notorio!s possession and occ!pation of the s!$@ect lands, !nder a $ona fide clai2 of o-nership since &!ne 1(, 1)*0 or earlier. The respondents presented the testi2onies of &!anito Gani2ti2 (!uanito , =dil$erto HaKanola, &acinto U2ali, =liseo Ean!elas, 3sa$elo U2ali, and =n%r. i4encio alerio and tax declarations to pro4e possession and occ!pation o4er the s!$@ect lots. These declarations and doc!2ents, ho-e4er, do not s!ffice to pro4e their +!alifications and co2pliance -ith the re+!ire2ents. 3n an' e4ent, &!anito failed to s!$stantiate his %eneral state2ent that his %reat %randparents -ere in possession of the s!$@ect lots for a period of o4er *0 'ears. <e failed to %i4e specific details on the act!al occ!panc' $' his predecessors-in-interest of the s!$@ect lots or 2ode of ac+!isition of o-nership for the period of possession re+!ired $' la-. 3t is a r!le that %eneral state2ents that are 2ere concl!sions of laand not fact!al proof of possession are !na4ailin% and cannot s!ffice. An applicant in a land re%istration case cannot @!st harp on 2ere concl!sions of la- to e2$ellish the application $!t 2!st i2press thereto the facts and circ!2stances e4idencin% the alle%ed o-nership and possession of the land. ?iDe &!anito, the testi2onies of =dil$erto HaKanola, &acinto U2ali, =liseo Ean!elas, and 3sa$elo U2ali -ere all !ns!$stantiated %eneral state2ents. ?iDe &!anito, ho-e4er, =dil$erto failed to present a d!plicate ori%inal cop' of the deed of sale dated Fe$r!ar' /, 1)1. and 4alidate his clai2 that he hi2self and his predecessors-in-interest ha4e $een in open, excl!si4e, contin!o!s, and notorio!s possession and occ!pation of the s!$@ect land, !nder a $ona fide clai2 of o-nership since &!ne 1(, 1)*0 or earlier. As for &acinto U2ali and =liseo Ean!elas, the' liDe-ise failed to a!thenticate their clai2 of ac+!isition thro!%h inheritance and ac+!isition thro!%h p!rchase, respecti4el'. Apparentl', the respondentsC $est e4idence to pro4e possession and o-nership o4er the s!$@ect propert' -ere the tax declarations iss!ed in their na2es. Unfort!natel', these tax declarations to%ether -ith their !ns!$stantiated %eneral state2ents and 2ere xerox copies of deeds of sale are not eno!%h to pro4e their ri%htf!l clai2. >ell settled is the r!le that tax declarations and receipts are not concl!si4e e4idence of o-nership or of the ri%ht to possess land -hen not s!pported $' an' other e4idence. The fact that the disp!ted propert' 2a' ha4e $een declared for taxation p!rposes in the na2es of the applicants for re%istration or of their predecessors-in-interest does not necessaril' pro4e o-nership. The' are 2erel' indicia of a clai2 of o-nership. Finall', the fact that the p!$lic prosec!tor of Ta%a'ta' Cit' did not contest the respondentsC possession of the s!$@ect propert' is of no 2o2ent. The a$sence of opposition fro2 %o4ern2ent a%encies is of no controllin% si%nificance $eca!se the State cannot $e estopped $' the o2ission, 2istaDe or error of its officials or a%ents.

WHEREFORE, the petition is GRANTED. Accordin%l', the Septe2$er 0, (000 7ecision of the Co!rt of Appeals in CA-E.R. C ;o. 1*1(0 is here$' REVERSED and SET ASIDE and another @!d%2ent entered den'in% the application for land re%istration of the s!$@ect properties.

HEIRS OF DR. JOSE DELESTE, n%'e(#) JOSEFA DELESTE, JOSE RA* DELESTE, RAUL HECTOR DELESTE, %n! RUBEN ALE+ DELESTE, Petitioners, 4ers!s LAND BAN, OF THE PHILIPPINES -LBP., %s represen e! "# / s M%n%0er, LAND VALUATION OFFICE OF LBP COTABATO CIT*1 THE REGIONAL DIRECTOR 2 REGION 34 OF COTABATO CIT*, THE SECRETAR* OF THE DEPARTMENT OF AGRARIAN REFORM1 THE REGIONAL DIRECTOR OF REGION + 2 CAGA*AN DE ORO CIT*, represen e! "# MCMILLAN LUCMAN, /n 5/s 6%p%6/ # %s Pr7v/n6/%( A0r%r/%n Re87r' O88/6er -PARO. 78 DAR L%n%7 !e( N7r e1 LI&A BALBERONA, /n 5er 6%p%6/ # %s DAR Mun/6/p%( A0r%r/%n Re87r' O88/6er -MARO.1 RE*NALDO BAGUIO, /n 5/s 6%p%6/ # %s 5e Re0/s er 78 Dee!s 78 I(/0%n C/ # %s n7'/n%( p%r #1 5e e'%n6/p% /7n p% en 57(!ers) FELIPE D. MANREAL, CUSTUDIO M. RICO, HEIRS OF DOMINGO V. RICO, HEIRS OF ABDON T. MANREAL, MACARIO M. VELORIA, ALICIA B. MANREAL, PABLO RICO, SALVACION MANREAL, HEIRS OF TRAN9UILIANA MANREAL, HEIRS OF ANGELA VELORIA, HEIRS OF NECIFURO CABALUNA, HEIRS OF CLEMENTE RICO, HEIRS OF MANTILLANO OBISO, HEIRS OF HERCULANO BALORIO, %n! TITO BALER, Respondents. FACTS: The spo!ses Ere%orio ;ana2an "Ere%orio# and <ilaria Ta$!clin "<ilaria# -ere the o-ners of a parcel of a%ric!lt!ral land located in Ta2$o, 3li%an Cit'. #. Said spo!ses -ere childless, $!t Ere%orio had a son na2ed ir%ilio ;ana2an " ir%ilio# $' another -o2an. ir%ilio had $een raised $' the co!ple since he -as t-o 'ears old. Ere%orio also had t-o da!%hters, =speranza and Caridad, $' still another -o2an. >hen Ere%orio died in 1)*0, <ilaria and ir%ilio ad2inistered the s!$@ect propert'. 5n Fe$r!ar' 1/, 1)0*, <ilaria and ir%ilio sold the s!$@ect propert' to 7r. &ose 7eleste "7eleste# for PhP 1/,000. The deed of sale -as notarized on Fe$r!ar' 11, 1)0* and re%istered on Garch (, 1)0*. Also, the tax declaration in the na2e of ir%ilio -as canceled and a ne- tax declaration -as iss!ed in the na2e of 7eleste. The arrears in the pa'2ent of taxes fro2 1)0( had $een !pdated $' 7eleste and fro2 then on, he paid the taxes on the propert'. Conse+!entl', <ilaria died. Ere%orioCs $rother, &!an ;ana2an, -as appointed as special ad2inistrator of the estate of the deceased spo!ses. S!$se+!entl', =dil$erto ;oel ";oel# -as appointed as the re%!lar ad2inistrator of the @oint estate. ;oel, as the ad2inistrator of the intestate estate of the deceased spo!ses, filed $efore the Co!rt of First 3nstance an action a%ainst 7eleste for the re4ersion of title o4er the s!$@ect propert', docDeted as Ci4il Case ;o. /).. Said case -ent !p to this Co!rt in "oel v. C#, -here >e rendered a 7ecision on &an!ar' 11, 1))0, affir2in% the r!lin% of the CA that the s!$@ect propert' -as the con@!%al propert' of the late spo!ses Ere%orio and <ilaria and that the latter co!ld onl' sell her one-half "1A(# share of the s!$@ect propert' to 7eleste. As a res!lt, 7eleste, -ho died in 1))(, and the intestate estate of Ere%orio -ere held to $e the co-o-ners of the s!$@ect propert', each -ith a one-half "1A(# interest in it. 3n 1)10, the Cit' of 3li%an passed Cit' 5rdinance ;o. 1,1,, Dno-n as the FLonin% Re%!lation of 3li%an Cit',J reclassif'in% the s!$@ect propert' as co22ercialAresidential. =4ent!all', on Fe$r!ar' 1(, 1).*, 7AR iss!ed Certificates of ?and Transfer "C?Ts# in fa4or of pri4ate respondents -ho -ere tenants and act!al c!lti4ators of the s!$@ect propert'. Gean-hile, on ;o4e2$er ((, 1))), the Cit' of 3li%an filed a co2plaint -ith the Re%ional Trial Co!rt "RTC#, Hranch * in 3li%an Cit' for the expropriation of a 0.*/./-hectare portion of a lot, -here the RTC iss!ed a 7ecision %rantin% the expropriation. Considerin% that the real o-ner of the expropriated portion co!ld not $e deter2ined, as the s!$@ect propert' had not

'et $een partitioned and distri$!ted to an' of the heirs of Ere%orio and 7eleste, the @!st co2pensation for the expropriated portion of the s!$@ect propert' -as deposited -ith the 7e4elop2ent HanD of the Philippines in 3li%an Cit', in tr!st for the RTC in 3li%an Cit'. 3SSU=: >hether or not the ina$ilit' to pa' tax declarations is a %ro!nd not to notif' the petitioners of the re%istration. <=?7: 3t sho!ld $e noted that the principal p!rpose of re%istration, in the Co!rtCs precedent @!rispr!dence, is Fto notif' other persons not parties to a contract that a transaction in4ol4in% the propert' has $een entered into.JThere -as, therefore, no reason for 7AR to fei%n i%norance of the transfer of o-nership o4er the s!$@ect propert'. PARA7 r!led that the petitioners -ere denied the ri%ht to $e %i4en the notice since onl' the ;ana2ans -ere identified as the o-ners. The fa!lt lies -ith petitioners -ho did not present the tax declaration in the na2e of 7r. 7eleste as of 5cto$er (1, 1)1(. 3t -as onl' in 1))0 that Ci4il Case ;o. /). -as finall' decided $' the S!pre2e Co!rt di4idin% the ,*.1 hectares $et-een the 7elestes and the ;ana2ans. ;ote that 7r. 7eleste died in 1))( after P7 (1 -as pro2!l%ated, hence, the s!$@ect land or his N share -as considered in his na2e onl' "see Art. 111, ;e- Ci4il Code#. =4en then, it 2!st $e $orne in 2ind that on Septe2$er (/, 1)1(, P7 ;o. ( -as iss!ed $' President Garcos proclai2in% the -hole co!ntr' as a land refor2 area, this -as follo-ed $' P7 (1. This sho!ld ha4e alar2ed the2 2ore so -hen pri4ate respondents are in act!al possession and c!lti4ation of the s!$@ect propert'. H!t it -as inc!2$ent !pon the 7AR to notif' 7eleste, $ein% the lando-ner of the s!$@ect propert'. 3t sho!ld $e noted that the deed of sale exec!ted $' <ilaria in fa4or of 7eleste -as re%istered on Garch (, 1)0*, and s!ch re%istration ser4es as a constr!cti4e notice to the -hole -orld that the s!$@ect propert' -as alread' o-ned $' 7eleste $' 4irt!e of the said deed of sale. 3n the sa2e 4ein, if the ille%alit' in the iss!ance of the C?Ts is patent, the Co!rt 2!st i22ediatel' taDe action and declare the iss!ance as n!ll and 4oid. There $ein% no +!estion that the C?Ts in the instant case -ere Fi2properl' iss!ed, for -hich reason, their cancellation is -arranted.J The sa2e holds tr!e -ith respect to the =Ps and certificates of title iss!ed $' 4irt!e of the 4oid C?Ts, as there can $e no 4alid transfer of title sho!ld the C?Ts on -hich the' -ere %ro!nded are 4oid. Cancellation of the =Ps and 5CTs are clearl' -arranted in the instant case since, aside fro2 the 4iolation of petitionersC ri%ht to d!e process of la-, the s!$@ect propert' is o!tside the co4era%e of the a%rarian refor2 pro%ra2. 3ne4ita$l', this leads to no other concl!sion than that 5!r r!lin% in $eirs of %ofia "anaman &onoy concernin% the indefeasi$ilit' and incontro4erti$ilit' of the =Ps and 5CTs iss!ed in (001 does not $ar Us fro2 2aDin% a findin% in the instant case that the =Ps and 5CTs iss!ed to pri4ate respondents are, indeed, 4oid. >ith the fore%oin% dis+!isition, it $eco2es !nnecessar' to d-ell on the other iss!es raised $' the parties. WHEREFORE, the Co!rt GRANTS the petition and REVERSES and SETS ASIDE the CACs 5cto$er (., (00* and Septe2$er 1,, (000 Resol!tions inCA-E.R. SP ;o. .0*11. The =2ancipation Patents and 5ri%inal Certificates of Title co4erin% the s!$@ect propert', partic!larl' ?ot ;o. 1*01, iss!ed in fa4or of pri4ate respondents are here$' declared NULL and VOID. The 7AR is ordered to CANCEL the afore2entioned =2ancipation Patents and 5ri%inal Certificates of Title erroneo!sl' iss!ed in fa4or of pri4ate respondents. ;o prono!nce2ent as to costs.