Applicable Doctrine: Power of Assessment

G.R. No. L-36181 October 23, 1982

MERALCO SECURITIES CORPORATION (now FIRST PHILIPPINE
HOLDINGS CORPORATION), petitioner, vs.HON. VICTORINO SAVELLANO
and ASUNCION BARON VDA. DE MANIAGO, et al., as heirs of the late Juan
G. Maniago, respondents
Facts:
Maniago submitted to the BIR confidential information alleging that
MERALCO committed tax evasion for the years 1962-1966. Commissioner then
caused the investigation but found that there was no deficiency since under the
law, dividends received by domestic or foreign corporation, only twenty-five per
centum thereof shall be returnable for the purposes of the tax imposed. The BIR
then denied Maniagos claim for informers reward. Thereafter, Maniago filed for
mandamus compelling the BIR to collect from MERALCO and also pay the
reward. BIR then countered saying that issuance or non-issuance of assessment
is within its discretionary power and thus mandamus would not lie against it since
it would be tantamount to usurpation of executive powers. Judge Savellano
however granted the mandamus and compelled BIR to collect from MERALCO
and pay Maniago the informers reward. A petition to set aside judges order was
then filed.
Issue: WON mandamus was properly issued.
Discussion: No.
Mandamus only lies to enforce the performance of a ministerial act or duty
and not to control the performance of a discretionary power. Purely administrative
and discretionary functions may not be interfered with by the courts. Thus, after
the Commissioner who is specifically charged by law with the task of enforcing
and implementing the tax laws and the collection of taxes had after a mature and
thorough study rendered his decision or ruling that no tax is due or collectible,
such decision or ruling is a valid exercise of discretion in the performance of
official duty and cannot be controlled much less reversed by mandamus.
Held: Petition GRANTED. Decision of judge is hereby REVERSED and SET
ASIDE.