Legislation, Executive Orders, and Court Decisions

Title

Creator

Selph, E. E.

Language

English

Source

The American Chamber of Commerce Journal Volume XXVIII (No. 12) December 1952

Year

1952

Rights

In Copyright - Educational Use Permitted

Fulltext

December, 1952 AMERICAN CHAMBER OF COMMERCE JOURNAL 499 Legislation, Executive Orders, and Court Decisions By E. E. Selph Ross, Selph, Carrascoso & Janda THE Supreme Court has granted a reconsideration of its decision referred to in the November issue of this Journal, relating to the Baguio tax on sales of gasoline. The point was raised that the tax was passed on to the consumer and therefore was not refundable to the dealers. The Supreme Court remanded the case to the Court of First Instance for presentation of evidence, stating that whether or not the dealers collected the taxes from the public was a question of fact to be decided by the Court of First Instance. an interesting phase of the income tax. law is covered by the recent decision in the Arnault tax-evasion case. (People vs. Arnault, G.R. No. L-4288, November 20, 1952.) It is impossible to get all the facts from the record, as so many people refused to talk. However, Mr. Arnault pleaded guilty, so we have to assume that the allegations in the complaint have been proved. On this basis Mr. Arnault was a vice-president of and acting for two Philip pine corporations which were attorneys-in-fact for General Burt who sold some real estate to the Philippine Govern ment at a profit of Pl,480,000 which was received by Arnault and on which there was an income tax claimed by the Philippine Government in the sum of Pl,089,270, no part of which was paid. The Court of First Instance rendered judgment imposing a fine of P 1,000 and ordered Arnault to indemnify the Philippine Government in the sum of Pl,089,270, with subsidiary imprisonment in case of insolvency. The section of the income tax law in volved is section 55 which provides that the owner of the gains or the person having the receipt, custody, control, or disposal of the same shall pay the tax due. The decision of the Court overruled Arnault’s plea that he was acting only for the Philippine corporations and not for Burt and was not personally liable. The Court said that by his plea of guilty he admitted having received the money for Burt and not for the Philippine corporations of which he was vice-president. On the point raised that giving the Collector of Internal Revenue the choice of prosecuting either the owner or the agent was an unlawful delegation of power, the Court said: "xxxlt is the Legislature that declares who is or who are re sponsible for the payment of the income tax under a given set of facts or circumstances. The Collector of Internal Revenue merely executes the law and under the circumstances, determines which of the two,— the owner or the agent—should and could have paid the income tax because he had the receipt, custody, control or disposal of the income or profit. In the present case, Burt was not in the Philippines. He did not have the receipt, custody, control or disposal of the profit of Pl,480,000.00. It is not known if he ever received any part of this amount; but the appellant had that amount in his hands and under the law he was charged with the duty of making a return of said income and pay the corresponding income tax for the owner of the income or profit in whose behalf according to the information he received the same. In selecting appellant Arnault as the person criminally responsi ble, and to be prosecuted, the Collector of Internal Revenue was merely enforcing and carrying out and executing the law on income tax promul gated by the Legislature, x x x” As to including the indemnity in the judgment in the criminal case with subsidiary imprisonment should the Pl,089,270 not be paid, the Supreme Court agreed with Arnault and eliminated the indemnity and subsidiary im prisonment in the following language: “We therefore hold that unless expressly provided by law, con viction for failure or neglect to pay a tax does not incldue payment of indemnity to the State in the amount of the tax not paid. So, it was error on the part of the trial court to sentence appellant to pay this indemnity; so was that part of the decision imposing subsidiary im prisonment in case of insolvency in the payment of the indemnity. In this connection, and to avoid any doubt, we may say that the Govern ment is free to avail itself of the Civil Remedies provided by the ^lternal Revenue Code to collect the tax herein involved.” P£T£R PAUL PHILIPPINE CORPORATION ¥ Manufacturer of Desiccated Coconut * Factory: Candelaria, Quezon Main Office: 1339 Oregon Your Health Is Our Business! . . . And it is the most im portant part of our business. Whenever you present a pre scription at our counter, your health is in our hands. To us, that little slip of paper is a sacred trust. Filling that written order precisely is our prime respon sibility. With it we are pledged to serve you ... to provide you with the highest caliber of professional service. Philippine American Drug Co. (BOTICA BOIE) PRESCRIPTION DEPARTMENT 102-104 Escolta, Manila ^EBU ’1LOILO LEGASPI DAVAO 500 AMERICAN CHAMBER OF COMMERCE JOURNAL December, 1952 EFFICIENT AND COURTEOUS VOICE 'SERVINS THE NATION SINCE 1905 DISTANCE TELEPHONE CO. MABQUES DE COMILLAS, MANILA go beyond the 1953 DESK CALENDARS and DESK & POCKET DIARIES Now Order Your 11M Cartillejoi, Manila 1953 DESK CALENDARS (Complete w'Stands fit Refills) "PECO" Standard,Gun-Metal Base, 6-3,-4x4-3/8”, Gray Finish P “PECO" Giant, Gun-Metal Base, 8x6-3/4”, Gray Finish........... “EVER READY" - Bakelite, 3-3/4x6-3/4", Black Finish......... "DEFIANCE" — Perfection Metal Base, 6-3/8x4-1/B", Metal-Brown Finish........................................................... Refills for 2 Styles, Side-Punched, at TI.10 <1 P2.10 (Send Sample Sheets With Order) 1953 DIARIES . “PECO" Pocket Diary, 2-5/8x4”, 45 pp. of goneral informa tion—Leatherette Cover..................................................... Imitation Leather Cover............................................ “PECO" Perpetual Diary, .8-1/4x10”, 184 pp.-Red Cloth Daily Desk Diary — A permanont book, combining THE DESK CALENDAR PAD, THE PERSONAL DIARY, THE BUSINESS DIARY, THE APPOINTMENT BOOK5-1 /4x7-3/4", Munitex Bound, asstd. colors...................... The Right Quality AT The Right Price However, the Supreme Court exercised its prerogative to increase the penalty by adding imprisonment to the fine and used the following language: “x x x After more or less extensive deliberations the great majority believe that because of the relatively large amount of the tax delin quency, the penalty should be increased as recommended by the Soli citor General. In addition to the fine of Pl,000.00 with subsidiary imprisonment in case of insolvency, we hereby sentence appellant to three (3) months imprisonment, with the accessories of the law.” Philippine Safety Council By Frank S. Tenny Founder and Executive Director DECEMBER will be an important month in the na tional safety movement. Far from taking a holiday at this time, the P.S.C. technical staff will work overtime, as December is the worst month of the year for many kinds of fires and accidents. People being human, they let their guard down during the Holidays, resulting in unusual difficulties arising in traffic, security, production, and fire-prevention factors. The joint air-ground payroll-delivery and cash-collec tion service is being incorporated and will be in operation before the first of the year. An armored car and a specially built airplane will be used. Inquiries are invited. Special efforts are being devoted to the tourism move ment and the coming International Fair. The Council is officially advising the Fair management in safety mat ters, and is working closely with the Travel and Tourist Association. The Manila Taxicabs & Garages Association, assisted by the Taxicab Inspection Service, is vigorously raising standards to meet the influx of expected visitors. The new National Traffic Commission and the FirePrevention Board are both meeting regularly. However, two important government safety units, the Advisory Safety Council to the Secretary of Labor and the Provincial Bus Terminals Board, have not met for months. It would appear that there is much for all of these groups to do. The “free car-safety check”, conducted by the Manila Trading & Supply Company in conjunction with the Coun cil, has proved to be a success and the service will soon be broadened to other firms. It is noteworthy that only about 25% of the vehicles tested are approved from the stand point of mechanical safety. Other items receiving special attention now include arson prevention, lectures to professional drivers, showing of safety films, organization of provincial chapters or co operating committees, and inspection of security units. All members of the American Chamber of Commerce of the Philippines are invited to join the Philippine Safety Council beginning in 1953. Nearly 50 members already belong. MOTOR SERVICE CO., II. AUTOMOTIVE PARTS • ACCESSORIES GARAGE & SHOP EQUIPMENT BATTERIES • TIRES • TUBES 230 13th St., Port Area Tel. 3-36-21

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