Scribd
Upload
634 views1 page

Phil Refining Co Vs Court of Appeals Case Digest

Phil Refining Co vs Court of Appeals Case Digest 1996-05-08 | G.R. No. 118794 Sec. 3 Art. XVI of the Constitution: The State may not be sued without its consent.(agency)

Uploaded by

Mark Co
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
634 views1 page

Phil Refining Co Vs Court of Appeals Case Digest

Phil Refining Co vs Court of Appeals Case Digest 1996-05-08 | G.R. No. 118794 Sec. 3 Art. XVI of the Constitution: The State may not be sued without its consent.(agency)

Uploaded by

Mark Co
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 1

PRC v.

CA

G.R. No. 118794

May 8, 1996

Sec. 3 Art. XVI of the Constitution: The State may not be sued without its consent.(agency)

FACTS:

Petitioner Philippine Refining Company (PRC) was assessed by respondent Commissioner of


Internal Revenue (Commissioner) to pay a deficiency tax for the year 1985 in the amount of
P1,892,584.00. Petitioner protested the assessment on the grounds that it was based on the erroneous
disallowances of "bad debts" and "interest expense" although the same are both allowable and legal
deductions. Respondent Commissioner, however, issued a warrant of garnishment against the deposits
of petitioner at a branch of City Trust Bank, in Makati, Metro Manila, which action the latter considered
as a denial of its protest. Petitioner then filed a petition for review with the Court of Tax Appeals (CTA)
on the same assignment of error, that is, that the "bad debts" and "interest expense" are legal and
allowable deductions. The CTA modified the findings of the Commissioner by reducing the deficiency
income tax assessment to P237,381.26, with surcharge and interest incident to delinquency. In said
decision, the Tax Court reversed and set aside the Commissioner's disallowance of the interest expense
of P2,666,545.19 but maintained the disallowance of the supposed bad debts of thirteen (13) debtors in
the total sum of P395,324.27. Petitioner then elevated the case to respondent Court of Appeals which,
as earlier stated, denied due course to the petition for review and dismissed the same

ISSUE:

1. Whether or not the debt owed to AFPCES is worthless?

HELD:

1. No , The Court held that the debt owed to AFPCES is not necessarily worthless merely because
of the fact that AFPCES is a government agency. AFPCES does not enjoy immunity from suits, while
discharging proprietary function.

You might also like