abra college vs aquino

taxation I
of 2
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  ABRA VALLEY COLLEGE, INC. represented by PEDRO V. BORGONIA, petitioner, vs. HON. JAN P. A!INO, J d#e, Co rt o$ %irst Inst&n'e, Abr&( AR)IN ). CARIAGA, Provin'i&* +re&s rer, Abr&( GAPAR V. BO!E, ) ni'ip&* +re&s rer, B&n# ed, Abr&( HEIR C% PA+ERNO )ILLARE, respondents%AC+-  Petitioner, an educational corporation and institution of higher learning duly incorporated with the Securities and Exchange Commission in 1948.  College was the d *y re#istered oner   of the parcel of land, upon which the school premises were erected.  ue to non!payment of real estate taxes, Noti'e o$ ei/ re &nd Noti'e o$ &*e  were issued y #espondents $unicipal and Pro%incial &reasurers in satisfaction of the de ts.  Petitioner College then filed a 'o0p*&int $or t1e &nn *0ent &nd de'*&r&tion o$ n **ity  of the orders. PE+I+IONER2 CON+EN+ION- Petitioner contends that the primary use of the lot and uilding for educational purposes, and not the incidental use thereof, determines and exemption from property taxes under Section '' ()*, +rticle - of the 19) Constitution. REPONDEN+2 CON+EN+ION- Pri%ate respondents maintain that the college lot and uilding in /uestion which were su 0ected to seiure and sale to answer for the unpaid tax are used2 (1* for the educational purposes of the college3 ('* as the permanent residence of the President and irector thereof, $r. Pedro . orgonia, and his family including the in!laws and grandchildren3 and ()* for commercial purposes ecause the ground floor of the college uilding is eing used and rented y a commercial esta lishment, the 5orthern $ar6eting Corporation R+C- &he trial court disagreed ecause of the use of the second floor y the irector of petitioner school for residential purposes. 7e thus ruled for the go%ernment and rendered the assailed decision. IE-  &he main issue in this case is the proper interpretation of the phrase used exclusi%ely for educational purposes.hether or not the su 0ect properties are exclusi%ely used for educational purposes and, in the affirmati%e, are a solutely exempted from payment of real estate taxes. HELD-NO . C:- correctly arri%ed at the conclusion that the school uilding as well as the lot where itis uilt, should e taxed, not ecause the second floor of the same is eing used y the irector and his family for residential purposes, ut be'& se t1e $irst $*oor t1ereo$ is bein# sed $or 'o00er'i&* p rposes.  7owe%er, since only a portion is used for purposes of commerce, it is only fair that half of the assessed tax e returned to the school in%ol%ed.  &he phrase exclusi%ely used for educational purposes was further clarified y this Court in the cases of Herrer& Vs. ! e/on City Bo&rd O$ Assess0ent Appe&*s , and Co00issioner o$ Intern&* Reven e vs. Bis1op o$ t1e )ission&ry Distri't , , thus ; <$oreo%er, the exemption in fa%or of property used exclusi%ely for charita le or educational purposes is 3not *i0ited to property &'t &**y indispens&b*e3  therefor (Cooley on &axation, ol. ', p. 14)=*, ut e4tends to $&'i*ities 1i'1 &re in'ident&* to &nd re&son&b*y ne'ess&ry $or t1e &''o0p*is10ent o$ s&id p rposes , such as in thecase of hospitals, a school for training nurses, a nurses> home, property use to pro%ide housing facilities for interns, resident doctors, superintendents, and other mem ers of the hospital staff, and recreational facilities for student nurses, interns, and residents>, such as +thletic fields including a firm used for the inmates of the institution.?&he test of exemption from taxation is the use of the property for purposes mentioned in the Constitution Aposto*i' Pre$e't v. City +re&s rer o$ B&# io . &he use of the school uilding or lot for commercial purposes is neither contemplated y law, nor y 0urisprudence. &hus, while the use of the second floor of the main uilding in the case at ar for residential purposes of the irector and his family, may find 0ustification under the concept of incidental use, which is complimentary to the main or primary purpose;educational, the lease of the first floor thereof tothe 5orthern $ar6eting Corporation cannot y any stretch of the imagination e considered incidental to the purpose of education. DIPOI+ION- P#E$-SES C@5S-E#E, the decision of the Court of :irst -nstance of + ra, ranch -, is here y A%%IR)ED  su 0ect to the modification that half of the assessed tax e returned to the petitioner.
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