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National Power Corporation Vs. Central Board of Assessment Appeals, et al.

NATIONAL POWER CORPORATION, Petitioner, versus CENTRAL BOARD OF ASSESSMENT APPEALS (CBAA), LOCAL BOARD OF ASSESSMENT APPEALS (LBAA) OF LA UNION, PROVINCIAL TREASURER, LA UNION and MUNICIPAL ASSESSOR OF BAUANG, LA UNION, Respondents.

G.R. No. 171470 | 2009-01-30

D E C I S I O N


BRION, J.:

What are the real property tax implications of a Build-Operate-Transfer (BOT) agreement between a government-owned and controlled corporation (GOCC) that enjoys tax exemption and a private corporation? Specifically, under the terms of the BOT Areement, can the GOCC be deemed the actual, direct, and exclusive user of machineries and equipment for tax exemption purposes? If not, can it pass on its tax-exempt status to its BOT partner, a private corporation, through the BOT agreement?

The National Power Corporation (NAPOCOR) claims in this case that the machineries and equipment used in a project covered by a...