FACTS
Pursuant to Ordinance No. 279 (1960), which imposed a quarterly tax on gross sales or receipts of merchants, dealers, importers and manufacturers of any commodity doing business in Cebu City, the City Treasurer collected P12,884.61 from Phil. Match Co. as tax on out-of-town deliveries of matches. Phil.
Match filed a claim for refund, citing as its legal basis the SC's decision in Shell v. Municipality of Sipocot, where sales of oil and petroleum products effected outside the territorial limits of Sipocot were held not to be subject to the tax imposed by an ordinance of that municipality.
The City Treasurer denied the claim, insisting that all out-of-town deliveries of matches stored in the city are subject to the sales tax imposed by the ordinance.
RULING
The Supreme Court ruled in favor of the City of Cebu.
RATIO: The SC held that so long as Phil. Match's orders were booked and paid for in the company's Cebu City office, those matches can be regarded as sold in the city, as contemplated in the ordinance, because the matches were delivered to the carrier in Cebu City.
Generally, delivery to the carrier is delivery to the buyer. To rule otherwise would defeat the tax ordinance in question or encourage tax evasion through the simple expedient of arranging for the delivery of the matches at the outskirts of the city though the purchase was effected and paid for in the company's branch office in the city.
