PLAN PLANTE TERS RS PROD PRODUC UCTS TS,, INC. INC. Vs FER FERTIPH TIPHIL IL CORP CORPOR ORA ATION TION G.R. No. 166006 March 14, 00! FACTS"
-Petitioner -Petitioner PPI and private respondent respondent Fertiphil are private corporations corporations incorporated under Philippine laws. They are both engaged in the importation and distribution of fertilizers, pesticides and agricultural chemicals. -On une !, "#$%, then President Ferdinand Ferdinand &arcos, e'ercising e'ercising his legislative legislative powers, issued (OI )o. "*+% which provided, among others, for the imposition of a capital recovery component / on the domestic sale of all grades of fertilizers in the Philippines. The (OI provides0 1!. The 2dministrator of the Fertilizer Pesticide 2uthority to include in its fertilizer pricing formula formula a capital capital contribu contribution tion compone component nt of not less than P"3 per bag. This capital capital contribution shall be collected until ade4uate capital is raised to ma5e PPI viable. 6uch capital contribution shall be applied by FP2 to all domestic sales of fertilizers in the Philippines.7 -Pursuant to the (OI, Fertiphil paid P"3 for every bag of fertilizer it sold in the domestic mar5et to the Fertilizer and Pesticide 2uthority FP2/. FP2 then remitted the amount collected to the Far 8ast 9an5 and Trust ompany, the depositary ban5 of PPI. Fertiphil paid P+,+$#,"** to FP2 from uly $, "#$% to anuary :*, "#$+. 2fter the "#$+ 8dsa evolution, FP2 voluntarily stopped the imposition of the P"3 levy. ;ith the return of democracy, Fertiphil demanded from PPI a refund of the amounts it paid under (OI )o. "*+%, but PPI refused to accede to the demand. -Fertiphil eneral, countered that the issuance of (OI )o. "*+% was a valid e'ercise of the police power of the 6tate in ensuring the stability of the fertilizer industry in the country. It also averred averred that Fertiphil did not sustain any damage from the (OI because the burden imposed by the levy fell on the ultimate consumer, not the seller. - On )ovember :3, "##", the T rendered =udgment in favor of Fertiphil - On )ovember :$, :33!, the 2 handed down its decision a?rming that of the T ISSUE"
;O) the law constitutes a valid legislation pursuant to the e'ercise of ta'ation and police power for public purposes.
HELD"
The P"3 levy under (OI (OI )o. "*+% "*+% is an e'erc e'ercise ise of the power power of ta'ation. ta'ation. Ta'es are are e'acted e'acted only for a public purpose. The P"3 levy is unconstitutional because it was not for a public purpose. The levy was imposed to give undue bene
;C88FO8, the petition is E8)I8E. The ourt of 2ppeals Eecision dated )ovember :$, :33! is 2FFI&8E. 6O OE88E.
