Lladoc v CIR (1965)

Lladoc v CIR
GR No L-19201, June 16, 1965

FACTS:
In 1957, MB Estate Inc. of Bacolod City donated P10,000 in cash to Reverend Father Ruiz, then parish priest of Victorias, Negros Occidental for the construction of a new Catholic Church. Under date of April 29, 1960, the Commissioner of Internal Revenue issued an assessment amounting to P 1,370 for donee’s gift tax against the Catholic Parish of Victorias. Petitioner lodged a protest to the assessment. CIR denied the protest which was substantially affirmed by the Court of Tax Appeals. Hence, this petition.

ISSUE:

1. (1)  Whether petitioner should be liable for the assessed donee’s gift tax on the P10,000 donation;
   
2. (2)  Who should be called upon to pay the tax?
   

RULING:
(1) The petitioner is liable. What the Collector assessed was a donee’s gift tax; the assessment was not on the properties themselves and is thus, not subject to the exemption in the Constitution. It did not rest upon general ownership; it was an excise upon the use made of the properties, upon the exercise of the privilege of receiving the properties. 
(2) The Head of the Diocese, to which the parish Victorias pertains is liable for the payment thereof.