The plaintiff is. a private corporation. The mere fact that the VOL. 46, DECEMBER 2, 1924 589
Government happens to be a majority stockholder does not National Coal Co. vs. Collector of Internal Revenue
make it a public corporation. Act No. 2705, as amended by Act
No. 2822, makes it subject to all of the provisions of the
Neither is there any provision in Act No. 2705 creating the
Corporation Law, in so far as they are not inconsistent with
National Coal Company, nor in the amendments thereof found
said Act (No. 2705). No provisions of Act No. 2705 are found
in Act No. 2822, which authorizes the National Coal Company
to be inconsistent with the provisions of the Corporation Law.
to enter upon any of the reserved coal lands without first
As a private corporation, it has no greater rights, powers or
having obtained permission from the Secretary of Agriculture
privileges than any other corporation which might be organized
and Natural Resources.
for the same purpose under the Corporation Law, and certainly
it was not the intention of the Legislature to give it a preference
or right or privilege over other legitimate private corporations The following propositions are fully sustained by the facts and
in the mining of coal. While it is true that said proclamation the law:
No. 39 withdrew "from settlement, entry, sale, or other
disposition of coal-bearing public lands within the Province of 1. (1) The National Coal Company is an ordinary private
Zamboanga * * * and the Island of Polillo," it made no corporation organized under Act No. 2705, and has no
provision for the occupation and operation by the plaintiff, to greater powers nor privileges than the ordinary private
the exclusion of other persons or corporations who might, corporation, except those mentioned, perhaps, in section
under proper permission, enter upon and operate coal mines. 10 of Act No. 2719, and they do not change the
situation here.
On the 14th day of May, 1917, and before the issuance of said 2. (2) It mined on public lands between the month of July,
proclamation, the Legislature of the Philippine Islands in "an 1920, and the month of March, 1922, 24,089.3 tons of
Act for the leasing and development of coal lands in the coal.
Philippine Islands" (Act No. 2719), made liberal provisions for 3. (3) Upon demand of the Collector of Internal Revenue
the encouragement of the coal mining industry. Section 1 of it paid a tax of P0.50 a ton, as taxes under the
said Act provides: "Coal-bearing lands of the public domain in provisions of article 1496 of the Administrative Code
the Philippine Islands shall not be disposed of in any manner on the 15th day of December, 1922.
except as provided in this Act," thereby giving a clear 4. (4) It is admitted that it is neither the owner nor the
lessee of the lands upon which said coal was mined.
5. (5) The proclamation of Francis Burton Harrison, lands of the public domain in the Philippine Islands shall not be
Governor-General, of the 18th day of October, 1917, by disposed of in any manner except as provided in this Act."
authority of section 1 of Act No. 926, withdrawing from
settlement, entry, sale, or other disposition all coal- Second. Provisions for leasing by the Secretary of Agriculture
bearing public lands within the Province of Zamboanga and Natural Resources of "unreserved, unappropriated coal-
and the Island of Polillo, was not a reservation for the bearing public lands," and the obligation to the Government
benefit of the National Coal Company, but for any which shall be imposed by said Secretary upon the lessee.
person or corporation of the Philippine Islands or of the
United States. Third. The internal revenue duty and tax which must be paid
6. (6) That the National Coal Company entered upon said upon coal-bearing lands owned by any person, firm,
land and mined said coal, so far as the record shows, association or corporation.
without any lease or other authority f rom either. the
Secretary of Agriculture and Natural Resources or any To repeat, it will be noted, first, that Act No. 2719 provides an
person having the power to grant a leave or authority. internal revenue duty and tax upon unreserved, unappropriated
coal-bearing public lands which may be leased by the Secretary
From all of the foregoing facts we find that the issue is well of Agriculture and Natural Resources; and, second, that said
defined between the plaintiff and the defendant. The plaintiff Act (No. 2719) provides an internal revenue duty and tax
contends that it was liable only to pay the internal imposed upon any person, firm, association or corporation,
who may be the owner of "coal-bearing lands." A reading of
590 said Act clearly shows that the tax imposed thereby is imposed
upon two classes of persons only—lessees and owners.
590 PHILIPPINE REPORTS ANNOTATED
National Coal Co. vs. Collector of Internal Revenue The lower court had some trouble in determining what was the
correct interpretation of section 15 of said Act, by reason of
what he believed to be some difference in the interpretation of
revenue and other fees and taxes provided for under section 15
the language used in Spanish and English. While there is some
of Act No. 2719; while the defendant contends, under the f acts
ground for confusion in the use of the language in Spanish and
of record, that the plaintiff is obliged to pay the internal
English, we are persuaded, considering all the provisions of
revenue duty provided for in section 1496 of the
said Act, that said section 15 has reference only to persons,
Administrative Code. That being the issue, an examination of
firms, associations or corporations which had already, prior to
the provisions of Act No. 2719 becomes necessary.
the existence of said
An examination of said Act (No. 2719) discloses the following
591
facts important for consideration here: First. All "coal-bearing
VOL. 46, DECEMBER 2, 1924 591 internal revenue tax under section 15 of Act No. 2719, nor to
National Coal Co. vs. Collector of Internal Revenue any other provisions of said Act.