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1.

Evangelista VS CIR

GR. No. 112675, Jan. 25,1999

This is a petition le! "# E$%e&ia Evangelista, 'an$ela Evangelista an! ()an*is*a Evangelista,

%o) )evie+ o% a !e*ision o% the Co$)t o% Ta -ppeals, the !ispositive pa)t o% +hi*h )ea!s

(/R -00 TE (/REG/ING, +e hol! that the petitione)s a)e lia"le %o) the in*o&e ta,)eal estate !eale)s ta an! the )esi!en*e ta %o) the #ea)s 1935 to 1939, in*l$sive, ina**o)!an*e +ith the )espon!ents assess&ent %o) the sa&e in the total a&o$nt o%46,7.3, +hi*h is he)e"# a)&e! an! the petition %o) )evie+ le! "# petitione) ishe)e"# !is&isse! +ith *osts against petitione)s.

It appea)s %)o& the stip$lation s$"&itte! "# the pa)ties

1. That the petitione)s "o))o+e! %)o& thei) %athe) the s$& o% 459,1388.88 +hi*ha&o$nt togethe) +ith thei) pe)sonal &onies +as $se! "# the& %o) the p$)pose o%

"$#ing )eal p)ope)ties,.2. That on (e")$a)# 2, 193, the# "o$ght %)o& ')s. Josena (lo)entino a lot +ith ana)ea o% ,71.38 s. &. in*l$!ing i&p)ove&ents the)eon %)o& the s$& o% 4188,888.88:this p)ope)t# has an assesse! val$e o% 457,517.88 as o% 193:

. That on -p)il , 1933 the# p$)*hase! %)o& ')s. Jose%a /pp$s 21 pa)*els o% lan! +ithan agg)egate a)ea o% ,71.38 s. &. in*l$!ing i&p)ove&ents the)eon %o) 418,888.88:this p)ope)t# has an assesse! val$e o% 42,255.88 as o% 193:

3. That on -p)il 2, 1933 the# p$)*hase! %)o& the Ins$la) Invest&ents In*., a lot o%3,5 s. &. in*l$!ing i&p)ove&ents the)eon %o) 418,25.88. This p)ope)t# has anassesse! val$e o% 43,9.88 as o% 193:

5. That on -p)il 2, 1933 the# "o$ght %o)& ')s. Valentina -%a"le a lot o% ,71 s. &.in*l$!ing i&p)ove&ents the)eon %o) 427,23.3. This p)ope)t# has an assesse! val$eo% 459,138.88 as o% 193:

6. That in a !o*$&ent !ate! -$g$st 16, 1935, the# appointe! thei) ")othe) Si&eonEvangelista to &anage thei) p)ope)ties +ith %$ll po+e) to lease: to *olle*t an! )e*eive)ents: to iss$e )e*eipts the)e%o): in !e%a$lt o% s$*h pa#&ent, to ")ing s$its against the!e%a$lting tenants: to sign all lette)s, *ont)a*ts, et*., %o) an! in thei) "ehal%, an! toen!o)se an! !eposit all notes an! *he*;s %o) the&:

7. That a%te) having "o$ght the a"ove

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*o)po)ation )esi!en*e ta %o) the #ea)s 1935

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Sai! lette) o% !e&an! an! *o))espon!ing assess&ents +e)e !elive)e! to petitione)s on=e*e&"e) , 1953, +he)e$pon the# instit$te! the p)esent *ase in the Co$)t o% Ta -ppeals,+ith a p)a#e) that Athe !e*ision o% the )espon!ent *ontaine! in his lette) o% !e&an! !ate!Septe&"e) 23, 1953A "e )eve)se!, an! that the# "e a"solve! %)o& the pa#&ent o% the taesin $estion, +ith *osts against the )espon!ent.

-%te) app)op)iate p)o*ee!ings, the Co$)t o% Ta -ppeals the a"ove

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. The a%o)esai! lots +e)e not !evote! to )esi!ential p$)poses, o) to othe) pe)sonal$ses, o% petitione)s he)ein. The p)ope)ties +e)e lease! sepa)atel# to seve)al pe)sons,+ho, %)o& 1935 to 193 in*l$sive, pai! the total s$& o% 478,86.8 "# +a# o% )entals.See&ingl#, the lots a)e still "eing so let, %o) petitione)s !o not even s$ggest that the)ehas "een an# *hange in the $tili>ation the)eo%.

3. Sin*e -$g$st, 1935, the p)ope)ties have "een $n!e) the &anage&ent o% one pe)son,na&el# Si&eon Evangelista, +ith %$ll po+e) to lease, to *olle*t )ents, to iss$e )e*eipts,to ")ing s$its, to sign lette)s an! *ont)a*ts, an! to in!o)se an! !eposit notes an!*he*;s. Th$s, the aHai)s )elative to sai! p)ope)ties have "een han!le! as i% the sa&e"elonge! to a *o)po)ation o) "$siness an! ente)p)ise ope)ate! %o) p)ot.

5. The %o)egoing *on!itions have eiste! %o) &o)e than ten 18F #ea)s, o), to "e ea*t,ove) %teen 15F #ea)s, sin*e the )st p)ope)t# +as a*$i)e!, an! ove) t+elve 12F#ea)s, sin*e Si&eon Evangelista "e*a&e the &anage).

6. 4etitione)s have not testie! o) int)o!$*e! an# evi!en*e, eithe) on thei) p$)pose in*)eating the set $p al)ea!# a!ve)te! to, o) on the *a$ses %o) its *ontin$e! eisten*e.

The# !i! not even t)# to oHe) an eplanation the)e%o).

-ltho$gh, ta;en singl#, the# &ight not s$*e to esta"lish the intent ne*essa)# to *onstit$te a

pa)tne)ship, the *olle*tive eHe*t o% these *i)*$&stan*es is s$*h as to leave no )oo& %o) !o$"ton the eisten*e o% sai! intent in petitione)s he)ein. /nl# one o) t+o o% the a%o)e&entione!*i)*$&stan*es +e)e p)esent in the *ases *ite! "# petitione)s he)ein, an!, hen*e, those *asesa)e not in point.

4etitione)s insist, ho+eve), that the# a)e &e)e *oations +hi*h a)e not ne*essa)il# Apa)tne)shipsA, in thete*hni*al sense o% the te)&. Th$s, %o) instan*e, se*tion 23 o% sai! Co!e ee&pts %)o& thea%o)e&entione! ta A!$l# )egiste)e! gene)al pa)tne)ships +hi*h *onstit$te p)e*isel# one o%the &ost t#pi*al %o)&s o% pa)tne)ships in this B$)is!i*tion. 0i;e+ise, as !ene! in se*tion 3"Fo% sai! Co!e, Athe te)& *o)po)ation in*l$!es pa)tne)ships, no matter how created ororganized.A This $ali%#ing ep)ession *lea)l# in!i*ates that a Boint vent$)e nee! not "e$n!e)ta;en in an# o% the stan!a)! %o)&s, o) in *on%o)&it# +ith the $s$al )e$i)e&ents o% thela+ on pa)tne)ships, in o)!e) that one *o$l! "e !ee&e! *onstit$te! %o) p$)poses o% the ta on*o)po)ations. -gain, p$)s$ant to sai! se*tion 3"F, the te)& A*o)po)ationA in*l$!es, a&ongothe), Boint a**o$nts, cuentas en participationFA an! Aasso*iations,A none of which has a legal

personality of its own, independent of that of its members. -**o)!ingl#, the la+&a;e) *o$l!not have )ega)!e! that pe)sonalit# as a *on!ition essential to the eisten*e o% thepa)tne)ships the)ein )e%e))e! to. In %a*t, as a"ove state!, A!$l# )egiste)e! gene)al*opa)tne)shipsA D which are possessed of the aforementioned personalityD have "eenep)essl# e*l$!e! "# la+ se*tions 23 an! 3 " %)o& the *onnotation o% the te)&A*o)po)ationA It &a# not "e a&iss to a!! that petitione)s allegation to the eHe*t that thei)lia"ilit# in *onne*tion +ith the leasing o% the lots a"ove )e%e))e! to, $n!e) the &anage&ent o%one pe)son D even i% t)$e, on +hi*h +e ep)ess no opinion D ten!s to increasethe si&ila)it#"et+een the nat$)e o% thei) vent$)e an! that *o)po)ations, an! is, the)e%o)e, an a!!itionala)g$&ent in favoro% the i&position o% sai! ta on *o)po)ations.

@n!e) the Inte)nal Reven$e 0a+s o% the @nite! States, A*o)po)ationsA a)e tae! !iHe)entl#

%)o& Apa)tne)shipsA. # spe*i* p)ovisions o% sai! la+s, s$*h A*o)po)ationsA in*l$!eAasso*iations, Boint

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. . . in an# na))o+ o) te*hni*al sense. It in*l$!es an# o)gani>ation, *)eate! %o) thet)ansa*tion o% !esigne! aHai)s, o) the attain&ent o% so&e o"Be*t, +hi*h li;e a*o)po)ation, *ontin$es not+ithstan!ing that its &e&"e)s o) pa)ti*ipants *hange, an!the aHai)s o% +hi*h, li;e *o)po)ate aHai)s, a)e *on!$*te! "# a single in!ivi!$al, a*o&&ittee, a "oa)!, o) so&e othe) g)o$p, a*ting in a )ep)esentative *apa*it#. It isi&&ate)ial +hethe) s$*h o)gani>ation is *)eate! "# an ag)ee&ent, a !e*la)ation o%t)$st, a stat$te, o) othe)+ise. It in*l$!es a vol$nta)# asso*iation, a Boint

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o) p)ope)ties )ente! o) oHe)e! to )ent %o) an agg)egate a&o$nt o% th)ee tho$san! pesoso) &o)e a #ea). . . e&phasis s$pplie!.F

he)e%o)e, the appeale! !e*ision o% the Co$)t o% Ta appeals is he)e"# a)&e! +ith *ostsagainst the petitione)s he)ein. It is so o)!e)e!.

#engzon, $aras, "%", $adilla, Reyes, &", Reyes, %"#"'", (ndencia and )elix, %%",*on*$).