This action was instituted in the Court of First Instance of the Province of Albay by Sy Yoco, a Chinese merchant, for the purpose  of  recovering from the Collector of Internal Revenue the sum  of  P313.57, paid by the plaintiff to the defendant  under protest as  an internal-revenue tax upon  certain transactions involving the buying  and selling of copra in the town of Tabaco, Province of Albay, during the quarter  ending December 31, 1922.  Upon hearing the cause the trial court held that the tax had been illegally exacted and gave judgment in favor of the  plaintiff to recover of the defendant the amount claimed in the complaint, without special pronouncement as to costs.  From this judgment the Collector of Internal Revenue appealed.

The facts of the  case  are  simple and may briefly  be stated as follows:  In the year  1922 the plaintiff  was engaged in  business as a merchant  in the town of Tabaco, Province  of Albay; and  as  such he was  accustomed  to deal in  the  buying and selling of abaca, rice,  copra, and other products of the country.  In connection with this business Sy Yoco maintained warehouses which were used for the deposit of merchandise.  In the month of July of the year mentioned one C. T. Williams began buying copra in the town of Tabaco for the purpose of selling the same to the El Dorado  Oil Works, an American corporation duly authorized to  do business in the Philippine  Islands. As Williams lived in Romblon, he could not personally  be present at all times in Tabaco, and he therefore entered into a written contract with Sy Yoco by which the latter was constituted his  agent in  Tabaco for the  purpose  of assisting in  the purchase of copra under the following conditions: Sy  Yoco agreed no longer to buy copra upon his own account, and his transactions in copra thereafter were limited  to the  purchase  of  copra for Williams at prices fixed by the latter.  The copra thus acquired  was stored in a bodega which Williams rented from Sy Yoco, the key to the bodega being kept at all times in the possession of an  employee of  Williams, who attended to the reception and storing of  the copra  during the ordinary hours of business.  When persons having  copra  for sale presented themselves at the establishment, the copra was directly delivered by the seller to the weigher and  keeper of the bodega, who received the same and issued the corresponding receipt in the name  of Williams.  This receipt was then presented to Sy  Yoco,  who paid for the amount of copra therein indicated from funds already placed in the  bank by Williams at Sy Yoco's disposition.   When, as sometimes happened, copra was brought to  Sy Yoco's establishment after Williams'  bodega had been closed for the day,  Sy Yoco was accustomed to receive and pay for the same upon account of Williams; and upon such occasions he stored the copra in another bodega and there kept it until Williams' keeper returned, whereupon the copra was transferred to Williams' bodega.

The copra purchased in the manner above  stated was sold by Williams to the El Dorado Oil Works in accordance with an agreement existing between Williams and the said company,  and was thereafter exported to America.  The plaintiff Sy  Yoco had no intervention whatever in the sale or exportation of  the copra,  and the internal-revenue tax corresponding to the sale or consignment of the copra to El Dorado Oil Works was paid by Williams.

For his services in connection with the purchase of  copra, as above  stated, and for the rental of his bodega, Sy Yoco was  paid  25 centavos for each  picul of copra so purchased.

Upon the facts above stated we are  of the opinion that the plaintiff, Sy Yoco, was not liable for the tax  which has  been exacted of him, and the trial court therefore committed no error in requiring  the Collector of Internal Revenue to return the money.  The  law under which the plaintiff is supposed to be liable for  the tax in question is the familiar section 1459 of the Administrative Code, as amended, which (subject to certain exemptions not necessary to be here noted) imposes on merchants a tax of 1 per centum on the gross value in money of merchandise "sold, bartered,  exchanged, or consigned abroad by them;" and the term "merchant" as used in said section is therein defined  so as to include commission merchants having establishments of their own for the keeping and disposal of goods of which sales or exchanges are effected.  The steps in the chain of argument of  the  Attorney-General,  representing the appellant Collector of Internal Revenue; are these:  namely, first, that the plaintiff, Sy Yoco, acted, in the transactions with which we are here concerned, in the character of an  agent  for Williams; secondly, that, having an establishment of his own for the  keeping and disposal of goods  of which sales were  effected, he  must be  considered  a  commission merchant within the meaning of  section  1459  of the  Administrative  Code; thirdly, that  the various transactions by which copra was purchased by Sy Yoco and  turned over to Williams were in effect sales from Sy Yoco to Williams;  and, lastly, as  a consequence of the foregoing three propositions,  that  Sy Yoco is  liable  for the tax imposed on merchants by the  section  cited.   In this connection reliance is placed by the Attorney-General upon the  decisions in Gil Hermanos  vs. Hord  (10 Phil., 218), and Muñoz & Co. vs. Hord (12 Phil., 624), as well as later cases in which the rules there announced have been applied.

In support of the appealed judgment the  attorneys  for the plaintiff-appellee insist, first, that the plaintiff has  not intervened in  any  sale of copra in  respect to which he might be  subject to taxation; secondly,  that the copra in question was consigned by Williams to the El Dorado Oil Works in  the United States,  upon which consignment  the tax has  been once paid by Williams; and, lastly, that, even viewing the transactions in question merely in the light of sales,  the  tax  cannot be collected twice.  In this connection reliance is placed upon the decision of this  court in Atkins, Kroll & Co. vs. Posadas  (48 Phil., 352).

Before beginning a discussion of the legal questions involved in the case we note that the point presented in the pleadings  and agreed statement  of facts is properly this, namely, whether  the plaintiff-appellee, Sy Yoco,  is liable for the merchant's tax upon copra purchased  by him for C. T. Williams during the quarter  ending December  31, 1922, and sold by Williams to El Dorado Oil  Works.  In other words the question is over the plaintiff's  liability for the tax on sales of copra and not over his liability for the tax on consignments abroad of copra.  It is true that it appears from  the testimony of Williams that the  copra in question was in fact shipped out of the Philippine Islands, and the attorneys for the appellee have seized upon  this fact to bring the case within the doctrine stated in Atkins, Kroll  &  Co.  vs. Posadas,  supra;  but, so far  as  appears, the tax with which we are concerned was assessed as a sales tax, and as such it will be here treated.   It will thus be seen that the case before us raises the same question with respect  to the liability of a commission  merchant for the tax on sales that was raised in the case  last mentioned with respect to his liability for the tax  on consignments of merchandise abroad.

Passing to a discussion of what appears to us  to be the vital point in the case we note that the law under which this tax  was  exacted  declares,  among other things,  that merchants shall be liable  for a tax calculated at  a certain per centum on the value of merchandise sold by them.  It is not the purchase but the sale that is intended  to be the subject of  taxation.   With this point in mind we proceed to inquire  what sale or sales of the copra with which we are  here concerned  have in fact been effected.   The answer is that,  so  far  as the  record shows, two sales,  and two sales only, of this copra have been made, namely, first, when the original producer (or owner)  brought  the product  to Sy Yoco's establishment and sold it to  Williams, or to Sy Yoco as Williams' agent; and, secondly, when Williams later sold the same copra to El Dorado Oil Works. We note in passing that the  argument for the Collector of Internal Revenue  supposes that there was really  a third sale, that is to say, a sale from Sy Yoco to Williams.  In our opinion this assumption  does manifest violence to  the facts and is utterly at variance with the real nature of  the transaction.  As  we  view the situation, when the copra was delivered by the producer  or prior  owner into  the warehouse where Williams caused it to be stored, the title passed at once directly to Williams,  without  being vested for a moment in the person of Sy Yoco.

The question then occurs, did Sy Yoco have a taxable relation to either of the two sales that actually occurred?   The answer must in our opinion  be  in the negative as  to each of said sales.   As to the first, when the producer parted with his product and received his pay from  Sy Yoco,  the latter certainly did not  intervene in the transaction in  the character of seller.  He intervened exclusively in the character of purchaser or agent of the purchaser, and hence as to him the transaction was  not  taxable in any sense. Indeed it is not insisted for  the  Collector that Sy  Yoco is taxable with respect to the transaction by which the copra was acquired by him as Williams' agent.

With respect to the sales of the copra to the El Dorado Oil Works, it is admitted that these transactions were  not made by Sy Yoco but by Williams, without any intervention whatever on the part of Sy Yoco.  It  follows that the latter cannot by  any possibility be  liable for the  tax on said sales.  Besides, this tax has been paid by Williams, and it cannot be collected again from Sy  Yoco.  It is insisted, however, for the appellant, that the decision in  Gil Hermanos vs. Hord (10 Phil., 218), supplies authority  for collecting the tax on a sale of this kind from both the agent (or commission merchant) and the owner of the commodity which  is sold. We consider the decision cited to be of doubtful application, since the  sale  was in  fact actually there made by the commission merchant, while in the case before us the commission merchant (Sy Yoco) intervened only in the  purchase of the copra and had nothing whatever to do with the sale which alone is the subject of taxation.  In  addition to this the force of said decision  has been  impaired by the  decision of this court in the case of  Atkins,  Kroll & Co. vs. Posadas  (48  Phil.,  352), wherein we held that upon a consignment of merchandise abroad, effected  by  a commission merchant in  behalf of another, the  tax can be collected  only  once;  and it seems obvious that every consideration pertinent to the taxation of consignments of merchandise abroad is equally  applicable to domestic sales.  But in the present case it is unnecessary to declare Gil Hermanos vs. Hord, supra, overruled, since the situation here involved is distinguished from that with which that decision  is concerned by the circumstance that in the present case the commission merchant who intervened in the purchase of the  copra had nothing whatever to do with the sale, which was effected exclusively by the owner.

For the reasons stated the  judgment appealed from will be affirmed, and  it is so ordered, without express pronouncement as to costs.

Avanceña,  C.  J., Villamor, Ostrand,  Johns, Romualdez, and Villa-Real, JJ, concur.