8/11/2019 Zamboanga Trans v Mun. of Zamboanga Digest Digest

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ZAMBOANGA TRANSPORTATION CO. v. MUNICIPALITY OFZAMBOANGAG.R. No. L-17005, December 12, 1921Ponente: Johnson, J.

Facts:

Plaintiff is a corporation engaged in transportation business by means of motorvehicles. Defendant is the Municipality of Zamboanga, which enacted Ordinance No.61, s. 1918 requiring transportation companies and agencies to pay license fees. Byvirtue of said ordinance, Defendant demanded payment of license fee from Plaintiffto which the latter paid the sum of P445 under protest.

Plaintiff filed an action to recover foregoing amount, which was allegedly wrongfullyand unlawfully collected by Defendant municipality. The lower court decided in favorof the Plaintiff on the basis that section 13 of Act No. 2587 provides that all motorvehicles shall be exempted from any local or municipal taxation. Thus, this appeal bythe Defendant municipality.

Issue:

Whether or not Defendant municipality has a right to impose a license fee.

Held:

Yes. Defendant municipality has a right to impose a license fee because under section2625 (d) of Act No. 2711, as amended by section 11 of Act 2819, the municipalcouncil shall have the power by ordinance or resolution xxx (d) to issue licenses fixingthe amount of license fee for the following: xxx transportation companies andagencies, etc.

The lower court erred in believing that the automobile or motor vehicle licenserequired by Act No. 2587 and the municipal license required by section 2625 (d) ofAct No. 2711 of transportation companies using motor vehicles, are the same.

A motor vehicle license is not a license to do business as a transportation company as common carrier. The former is paid to the Insular Government; the latter, to thelocal or municipal government. The former is a license to own motor vehicles; thelatter is a license to operate those motor vehicles as common carrier or as atransportation company. In other words, the former is a tax on the motor vehicles,while the latter is a tax on the business of the transportation company operatingthose motor vehicles. The municipal government is prohibited by section 13 of Act

No. 2587 from imposing the former, but it is expressly authorized by section 2625 (d)of Act No. 2711 to impose the latter.

The municipal government may prescribe certain regulations governingtransportation companies, which operate within its territorial jurisdiction. Hence, webelieve that the Legislature did not mean nor intend that a license to own motorvehicles should be in itself a license to do business as a common carrier ortransportation company.

Wherefore, the judgment of the lower court is hereby revoked and the defendant ishereby absolved from all liability under the complaint, with costs against the plaintiff.