In order to constitute a partnership inter sese there must be: (a) An intent to form the same; (b) generally participating in both profits and losses; (c) and such a community of interest, as far as third persons are concerned as enables each party to make contract, manage the business, and dispose of the whole property
a. Intent b. Participate in Both Profits and Losses c. Community of Interests
It is evident that an isolated transaction whereby two or more persons contribute funds to buy certain real estate for profit in the absence of other circumstances showing a contrary intention cannot be considered a partnership.
Habituality is lacking
The true test of a contractor as was held in the cases of Luzon Stevedoring Co., vs. Trinidad, 43, Phil. 803, 807-808, and La Carlota Sugar Central vs. Trinidad, 43, Phil. 816, 819, would seem to be that he renders service in the course of an independent occupation, representing the will of his employer only as to the result of his work, and not as to the means by which it is accomplished.
Contract of work: product based; contractor may determine how to do work.
Note: This echoes the "control" test in the 4-fold test for employer-employee relationship. In contract of work, there is no control of how the work is done, only the output. Therefore, the contractor is not an employee.
If the article ordered by the purchaser is exactly such as the plaintiff makes and keeps on hand for sale to anyone, and no change or modification of it is made at defendant's request, it is a contract of sale, even though it may be entirely made after, and in consequence of, the defendants order for it
Sale: Regular Product, even if made after order. Contract for work, labor, and materials: made to order. Both depend on agreement.
whether or not Engineering is a manufacturer of air conditioning units under Section 185(m), supra, in relation to Sections 183(b) and 194 of the Code, or a contractor under Section 191 of the same Code.
Whether seller or contractor
holding respondent company liable to the 3% contractor's tax imposed by Section 191 of the Tax Code instead of the 30% sales tax prescribed in Section 185(m) in relation to Section 194(x) both of the same Code;
Sale vs Contract for a piece of work
30% compensating tax on its importations of equipment and ordinary articles used in the central type air conditioning systems it designed, fabricated, constructed and installed in the buildings and premises of its customers, rather than to the compensating tax of only 7%
Sect 126 (8%) vs Sect 125 (30%) of tax code [aircon]
examiners Quesada and Catudan reported and recommended
Examiners recommended that Engineering be assessed for Php 480k for deficiency advance sales tax