NGCP asks RTC to stop tax collection, auction

THE National Grid Corporation of the Philippines (NGCP) filed a civil action to seek redress against the P192-million real property tax imposed by the Cebu Provincial Government on its assets.

The NGCP, the private operator of the country’s power transmission network, asked the Regional Trial Court to stop the Capitol’s plan to auction its properties, which include submarine cables, transmission lines and other machinery.

The power grid operator warned of massive blackout in the Visayas if the public auction pushes through.

“Should the auction sale proceed, the public will be deprived of the right to the enjoyment of uninterrupted supply of electricity, to their prejudice and inconvenience,” the NGCP said in its complaint, which was prepared by its lawyers Aristotle Valera, Sorayda Omar and Marijoy Francisco.

Named respondents were Cebu Province, Provincial Treasurer Roy Salubre, Provincial Assessor Anthony Sususco and the National Transmission Corp., which was impleaded as unwilling co-plaintiff.

The NGCP said in its complaint that it is exempted from paying real property tax under Section 234 of the Local Government Code since the submarine cables, transmission lines and other machinery are being utilized “directly and exclusively” to transmit electricity.

“The tax exemption from the payment of real property tax on the properties that are used in connection with the operation of its franchise was expressly granted to NGCP,” the NGCP said in its complaint.

Franchise

Citing Section 9 of Republic Act 9511, the NGCP said it is only required to pay three percent franchise tax to the National Government.

Despite this, the NGCP said, it received a notice of delinquency from the provincial treasurer on Aug. 8, 2011, in relation to properties in Barangay Suba, Samboan and Barangay Talisay, Daanbantayan.

The notice of tax properties delinquency covers the submarine cables, transmission lines and other machineries owned by NGCP. These assets were given an assessment level of 80 percent and valued at P1.2 billion by 2009.

The NGCP officers and Capitol officials met several times this year to discuss the real property tax delinquency.

Warrant

But on May 8, the Province issued a warrant of levy on the real properties owned by NGCP in Samboan and Daanbantayan towns.

“NGCP is exempt from payment of real property tax on properties used in connection with its franchise and all taxes, duties, fees and charges of any kind or description levied, established or collected by any local or National Government,” the complaint read.

The NGCP asked the court to declare as null and void the tax declaration 14737 and 24085.

The grid operator also sought from the court the issuance of a 20-day temporary restraining order and preliminary injunction.