GR L 11807; (May, 1961) (Digest)
G.R. No. L-11807 May 19, 1961
COLLECTOR OF INTERNAL REVENUE, petitioner, vs. CONVENTION OF PHILIPPINE BAPTIST CHURCHES and the COURT OF TAX APPEALS, respondents.
FACTS
The Collector of Internal Revenue (CIR) was the petitioner in a tax case against the Convention of Philippine Baptist Churches. The Court of Tax Appeals (CTA) ruled in favor of the church. The CIR elevated the matter to the Supreme Court via a petition for review. In its decision dated January 28, 1961, the Supreme Court affirmed the CTA’s decision, thereby ruling against the CIR. The dispositive part of that Supreme Court decision also imposed the costs of the suit on the petitioner, the Collector of Internal Revenue.
Subsequently, the CIR filed a motion for reconsideration dated February 21, 1961. However, the CIR did not seek to overturn the substantive ruling on the tax exemption itself. Instead, the motion specifically prayed only for an amendment to the decision’s dispositive portion. The sole relief requested was the elimination of the imposition of costs against the petitioner.
ISSUE
Whether the imposition of costs of suit on the petitioner, the Collector of Internal Revenue, in the dispositive part of the Supreme Court’s decision should be deleted.
RULING
Yes, the imposition of costs was correctly deleted. The Supreme Court granted the CIR’s motion for reconsideration, amending its prior decision by eliminating the order for the petitioner to pay costs. The legal logic for this resolution is rooted in established jurisprudence and the nature of the Collector’s official function. The Court cited two controlling precedents: Collector vs. St. Paul’s Hospital (G.R. No. L-18127, May 25, 1959) and Collector vs. Sweeney (G.R. No. L-12178, August 21, 1951).
The principle derived from these cases is that the Collector of Internal Revenue, when performing official duties in assessing and collecting taxes, acts as a government agent. In litigating tax cases to test the validity of an assessment or the application of a revenue law, the Collector is not pursuing a personal interest but is discharging a statutory mandate to protect public funds. Therefore, imposing litigation costs against the Collector in his official capacity is tantamount to imposing costs upon the government itself for performing its lawful duty. The Court has consistently held that, under such circumstances, costs should not be awarded against the Collector. The resolution thus corrects a procedural formality in line with this settled doctrine, without disturbing the affirmed judgment on the merits of the tax exemption claim.