BARA LIDASAN, 
petitioner, Prompted by the coming elections, Comelec adopted its resolution of August
vs.
COMMISSION ON ELECTIONS, respondent.
Suntay for petitioner.
Barrios and Fule for respondent.
SANCHEZ, J.:
The question initially presented to the Commission on Elections,1 is this: Is
Republic Act 4790, which is entitled "An Act Creating the Municipality of
Dianaton in the Province of Lanao del Sur", but which includes barrios located
in another province — Cotabato — to be spared from attack planted upon the
constitutional mandate that "No bill which may be enacted into law shall
embrace more than one subject which shall be expressed in the title of the
bill"? Comelec's answer is in the affirmative. Offshoot is the present original
petition for certiorari and prohibition.
On June 18, 1966, the Chief Executive signed into law House Bill 1247, known
as Republic Act 4790, now in dispute. The body of the statute, reproduced
in haec verba, reads:
Sec. 1. Barrios Togaig, Madalum, Bayanga, Langkong, Sarakan, Kat-
bo, Digakapan, Magabo, Tabangao, Tiongko, Colodan, Kabamakawan,
Kapatagan, Bongabong, Aipang, Dagowan, Bakikis, Bungabung,
Losain, Matimos and Magolatung, in the Municipalities of Butig and
Balabagan, Province of Lanao del Sur, are separated from said
municipalities and constituted into a distinct and independent
municipality of the same province to be known as the Municipality of
Dianaton, Province of Lanao del Sur. The seat of government of the
municipality shall be in Togaig.
Sec. 2. The first mayor, vice-mayor and councilors of the new
municipality shall be elected in the nineteen hundred sixty-seven
general elections for local officials.
Sec. 3. This Act shall take effect upon its approval.
It came to light later that barrios Togaig and Madalum just mentioned are within
the municipality of Buldon, Province of Cotabato, and that Bayanga, Langkong,
Sarakan, Kat-bo, Digakapan, Magabo, Tabangao, Tiongko, Colodan and
Kabamakawan are parts and parcel of another municipality, the municipality
of Parang, also in the Province of Cotabato and not of Lanao del Sur.
15, 1967, the pertinent portions of which are:
For purposes of establishment of precincts, registration of voters and
for other election purposes, the Commission RESOLVED that pursuant
to RA 4790, the new municipality of Dianaton, Lanao del Sur shall
comprise the barrios of Kapatagan, Bongabong, Aipang, Dagowan,
Bakikis, Bungabung, Losain, Matimos, and Magolatung situated in the
municipality of Balabagan, Lanao del Sur, the barrios of Togaig and
Madalum situated in the municipality of Buldon, Cotabato, the barrios of
Bayanga, Langkong, Sarakan, Kat-bo, Digakapan, Magabo, Tabangao,
Tiongko, Colodan and Kabamakawan situated in the municipality of
Parang, also of Cotabato.
Doubtless, as the statute stands, twelve barrios — in two municipalities in the
province of Cotabato — are transferred to the province of Lanao del Sur. This
brought about a change in the boundaries of the two provinces.
Apprised of this development, on September 7, 1967, the Office of the
President, through the Assistant Executive Secretary, recommended to
Comelec that the operation of the statute be suspended until "clarified by
correcting legislation."
Comelec, by resolution of September 20, 1967, stood by its own interpretation,
declared that the statute "should be implemented unless declared
unconstitutional by the Supreme Court."
This triggered the present original action for certiorari and prohibition by Bara
Lidasan, a resident and taxpayer of the detached portion of Parang, Cotabato,
and a qualified voter for the 1967 elections. He prays that Republic Act 4790 be
declared unconstitutional; and that Comelec's resolutions of August 15, 1967
and September 20, 1967 implementing the same for electoral purposes, be
nullified.
1. Petitioner relies upon the constitutional requirement aforestated, that "[n]o bill
which may be enacted into law shall embrace more than one subject which
shall be expressed in the title of the bill."2
It may be well to state, right at the outset, that the constitutional provision
contains dual limitations upon legislative power. First. Congress is to refrain
from conglomeration, under one statute, of heterogeneous subjects. Second.
The title of the bill is to be couched in a language sufficient to notify the
legislators and the public and those concerned of the import of the single
subject thereof.
Of relevance here is the second directive. The subject of the statute must be Lanao del Sur," read without subtlety or contortion, makes the title misleading,
"expressed in the title" of the bill. This constitutional requirement "breathes the deceptive. For, the known fact is that the legislation has a two-pronged purpose
spirit of command."3 Compliance is imperative, given the fact that the combined in one statute: (1) it creates the municipality of Dianaton purportedly
Constitution does not exact of Congress the obligation to read during its from twenty-one barrios in the towns of Butig and Balabagan, both in the
deliberations the entire text of the bill. In fact, in the case of House Bill 1247, province of Lanao del Sur; and (2) it also dismembers two municipalities in
which became Republic Act 4790, only its title was read from its introduction to Cotabato, a province different from Lanao del Sur.
its final approval in the House of Representatives4 where the bill, being of local
application, originated.5 The baneful effect of the defective title here presented is not so difficult to
perceive. Such title did not inform the members of Congress as to the full
Of course, the Constitution does not require Congress to employ in the title of impact of the law; it did not apprise the people in the towns of Buldon and
an enactment, language of such precision as to mirror, fully index or catalogue Parang in Cotabato and in the province of Cotabato itself that part of their
all the contents and the minute details therein. It suffices if the title should serve territory is being taken away from their towns and province and added to the
the purpose of the constitutional demand that it inform the legislators, the adjacent Province of Lanao del Sur; it kept the public in the dark as to what
persons interested in the subject of the bill, and the public, of the nature, scope towns and provinces were actually affected by the bill. These are the pressures
and consequences of the proposed law and its operation. And this, to lead which heavily weigh against the constitutionality of Republic Act 4790.
them to inquire into the body of the bill, study and discuss the same, take
appropriate action thereon, and, thus, prevent surprise or fraud upon the Respondent's stance is that the change in boundaries of the two provinces
legislators.6 resulting in "the substantial diminution of territorial limits" of Cotabato province
is "merely the incidental legal results of the definition of the boundary" of the
In our task of ascertaining whether or not the title of a statute conforms with the municipality of Dianaton and that, therefore, reference to the fact that portions
constitutional requirement, the following, we believe, may be taken as in Cotabato are taken away "need not be expressed in the title of the law." This
guidelines: posture — we must say — but emphasizes the error of constitutional
dimensions in writing down the title of the bill. Transfer of a sizeable portion of
The test of the sufficiency of a title is whether or not it is misleading; territory from one province to another of necessity involves reduction of area,
and, which technical accuracy is not essential, and the subject need not population and income of the first and the corresponding increase of those of
be stated in express terms where it is clearly inferable from the details the other. This is as important as the creation of a municipality. And yet, the title
set forth, a title which is so uncertain that the average person reading it did not reflect this fact.
would not be informed of the purpose of the enactment or put on inquiry
as to its contents, or which is misleading, either in referring to or Respondent asks us to read Felwa vs. Salas, L-16511, October 29, 1966, as
indicating one subject where another or different one is really embraced controlling here. The Felwa case is not in focus. For there, the title of the Act
in the act, or in omitting any expression or indication of the real subject (Republic Act 4695) reads: "An Act Creating the Provinces of Benguet,
or scope of the act, is bad. Mountain Province, Ifugao, and Kalinga-Apayao." That title was assailed as
unconstitutional upon the averment that the provisions of the law (Section, 8
xxx           xxx           xxx thereof) in reference to the elective officials of the provinces thus created, were
not set forth in the title of the bill. We there ruled that this pretense is devoid of
In determining sufficiency of particular title its substance rather than its merit "for, surely, an Act creating said provinces must be expected to provide
form should be considered, and the purpose of the constitutional for the officers who shall run the affairs thereof" — which is "manifestly
requirement, of giving notice to all persons interested, should be kept in germane to the subject" of the legislation, as set forth in its title. The statute
mind by the court.7 now before us stands altogether on a different footing. The lumping together of
barrios in adjacent but separate provinces under one statute is neither a natural
nor logical consequence of the creation of the new municipality of Dianaton. A
With the foregoing principles at hand, we take a hard look at the disputed
change of boundaries of the two provinces may be made without necessarily
statute. The title — "An Act Creating the Municipality of Dianaton, in the
creating a new municipality and vice versa.
Province of Lanao del Sur"  — projects the impression that solely the province
8

of Lanao del Sur is affected by the creation of Dianaton. Not the slightest
intimation is there that communities in the adjacent province of Cotabato are As we canvass the authorities on this point, our attention is drawn to Hume vs.
incorporated in this new Lanao del Sur town. The phrase "in the Province of Village of Fruitport, 219 NW 648, 649. There, the statute in controversy bears
the title "An Act to Incorporate the Village of Fruitport, in the County of
Muskegon." The statute, however, in its section 1 reads: "The people of the
state of Michigan enact, that the following described territory in the counties of
Muskegon and Ottawa Michigan, to wit: . . . be, and the same is hereby
constituted a village corporate, by the name of the Village of Fruitport." This
statute was challenged as void by plaintiff, a resident of Ottawa county, in an
action to restraint the Village from exercising jurisdiction and control, including
taxing his lands. Plaintiff based his claim on Section 20, Article IV of the
Michigan State Constitution, which reads: "No law shall embrace more than
one object, which shall be expressed in its title." The Circuit Court decree
voided the statute and defendant appealed. The Supreme Court of Michigan
voted to uphold the decree of nullity. The following, said in Hume, may well
apply to this case:
It may be that words, "An act to incorporate the village of Fruitport,"
would have been a sufficient title, and that the words, "in the county of
Muskegon" were unnecessary; but we do not agree with appellant that
the words last quoted may, for that reason, be disregarded as
surplusage.
. . . Under the guise of discarding surplusage, a court cannot reject a
part of the title of an act for the purpose of saving the act. Schmalz vs.
Woody, 56 N.J. Eq. 649, 39 A. 539.
A purpose of the provision of the Constitution is to "challenge the
attention of those affected by the act to its provisions." Savings Bank
vs. State of Michigan, 228 Mich. 316, 200 NW 262.
The title here is restrictive. It restricts the operation of the act of
Muskegon county. The act goes beyond the restriction. As was said in
Schmalz vs. Wooly, supra: "The title is erroneous in the worst degree,
for it is misleading."9
Similar statutes aimed at changing boundaries of political subdivisions, which
legislative purpose is not expressed in the title, were likewise declared
unconstitutional."10
We rule that Republic Act 4790 is null and void.
2. Suggestion was made that Republic Act 4790 may still be salvaged with
reference to the nine barrios in the municipalities of Butig and Balabagan in
Lanao del Sur, with the mere nullification of the portion thereof which took away
the twelve barrios in the municipalities of Buldon and Parang in the other
province of Cotabato. The reasoning advocated is that the limited title of the Act a group of barrios is capable of maintaining itself as an independent
still covers those barrios actually in the province of Lanao del Sur.
We are not unmindful of the rule, buttressed on reason and of long standing,
that where a portion of a statute is rendered unconstitutional and the remainder
valid, the parts will be separated, and the constitutional portion upheld. Black,
however, gives the exception to this rule, thus:
. . . But when the parts of the statute are so mutually dependent and
connected, as conditions, considerations, inducements, or
compensations for each other, as to warrant a belief that the legislature
intended them as a whole, and that if all could not be carried into effect,
the legislature would not pass the residue independently, then, if some
parts are unconstitutional, all the provisions which are thus dependent,
conditional, or connected, must fall with them,11
In substantially similar language, the same exception is recognized in the
jurisprudence of this Court, thus:
The general rule is that where part of a statute is void, as repugnant to
the Organic Law, while another part is valid, the valid portion if
separable from the invalid, may stand and be enforced. But in order to
do this, the valid portion must be so far independent of the invalid
portion that it is fair to presume that the Legislature would have enacted
it by itself if they had supposed that they could not constitutionally enact
the other. . . Enough must remain to make a complete, intelligible, and
valid statute, which carries out the legislative intent. . . . The language
used in the invalid part of the statute can have no legal force or efficacy
for any purpose whatever, and what remains must express the
legislative will independently of the void part, since the court has no
power to legislate, . . . .12
Could we indulge in the assumption that Congress still intended, by the Act, to
create the restricted area of nine barrios in the towns of Butig and Balabagan in
Lanao del Sur into the town of Dianaton, if the twelve barrios in the towns of
Buldon and Parang, Cotabato were to be excluded therefrom? The answer
must be in the negative.
Municipal corporations perform twin functions. Firstly. They serve as an
instrumentality of the State in carrying out the functions of
government. Secondly. They act as an agency of the community in the
administration of local affairs. It is in the latter character that they are a
separate entity acting for their own purposes and not a subdivision of the
State.13
Consequently, several factors come to the fore in the consideration of whether
municipality. Amongst these are population, territory, and income. It was
apparently these same factors which induced the writing out of House Bill 1247
creating the town of Dianaton. Speaking of the original twenty-one implementation of Republic Act 4790. Stated differently, respondent's pose is
barrios which comprise the new municipality, the explanatory note to House Bill that petitioner is not the real party in interest.
1247, now Republic Act 4790, reads:
Here the validity of a statute is challenged on the ground that it violates the
The territory is now a progressive community; the aggregate population constitutional requirement that the subject of the bill be expressed in its title.
is large; and the collective income is sufficient to maintain an Capacity to sue, therefore, hinges on whether petitioner's substantial rights or
independent municipality. interests are impaired by lack of notification in the title that the barrio in Parang,
Cotabato, where he is residing has been transferred to a different provincial
This bill, if enacted into law, will enable the inhabitants concerned to hegemony.
govern themselves and enjoy the blessings of municipal autonomy.
The right of every citizen, taxpayer and voter of a community affected by
When the foregoing bill was presented in Congress, unquestionably, the totality legislation creating a town to ascertain that the law so created is not
of the twenty-one barrios — not nine barrios — was in the mind of the dismembering his place of residence "in accordance with the Constitution" is
proponent thereof. That this is so, is plainly evident by the fact that the bill itself, recognized in this jurisdiction.
15

thereafter enacted into law, states that the seat of the government is in Togaig,
which is a barrio in the municipality of Buldon in Cotabato. And then the Petitioner is a qualified voter. He expects to vote in the 1967 elections. His right
reduced area poses a number of questions, thus: Could the observations as to to vote in his own barrio before it was annexed to a new town is affected. He
progressive community, large aggregate population, collective income sufficient may not want, as is the case here, to vote in a town different from his actual
to maintain an independent municipality, still apply to a motley group of only residence. He may not desire to be considered a part of hitherto different
nine barrios out of the twenty-one? Is it fair to assume that the inhabitants of communities which are fanned into the new town; he may prefer to remain in
the said remaining barrios would have agreed that they be formed into a the place where he is and as it was constituted, and continue to enjoy the rights
municipality, what with the consequent duties and liabilities of an independent and benefits he acquired therein. He may not even know the candidates of the
municipal corporation? Could they stand on their own feet with the income to new town; he may express a lack of desire to vote for anyone of them; he may
be derived in their community? How about the peace and order, sanitation, and feel that his vote should be cast for the officials in the town before
other corporate obligations? This Court may not supply the answer to any of dismemberment. Since by constitutional direction the purpose of a bill must be
these disturbing questions. And yet, to remain deaf to these problems, or to shown in its title for the benefit, amongst others, of the community affected
answer them in the negative and still cling to the rule on separability, we are thereby,16 it stands to reason to say that when the constitutional right to vote on
afraid, is to impute to Congress an undeclared will. With the known premise the part of any citizen of that community is affected, he may become a suitor to
that Dianaton was created upon the basic considerations of progressive challenge the constitutionality of the Act as passed by Congress.
community, large aggregate population and sufficient income, we may not now
say that Congress intended to create Dianaton with only nine — of the original For the reasons given, we vote to declare Republic Act 4790 null and void, and
twenty-one — barrios, with a seat of government still left to be conjectured. For, to prohibit respondent Commission from implementing the same for electoral
this unduly stretches judicial interpretation of congressional intent beyond purposes.
credibility point. To do so, indeed, is to pass the line which circumscribes the
judiciary and tread on legislative premises. Paying due respect to the traditional No costs allowed. So ordered.
separation of powers, we may not now melt and recast Republic Act 4790 to
read a Dianaton town of nine instead of the originally intended twenty-one
Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Bengzon, J.P., Zaldivar,
barrios. Really, if these nine barrios are to constitute a town at all, it is the
Castro and Angeles, JJ., concur.
function of Congress, not of this Court, to spell out that congressional will.

Republic Act 4790 is thus indivisible, and it is accordingly null and void in its
totality.14

3. There remains for consideration the issue raised by respondent, namely, that
petitioner has no substantial legal interest adversely affected by the
Separate Opinions being that while the main subject of the act was reorganization, the provision
assailed did not deal with reorganization but with taxation. While the case
FERNANDO, J., dissenting: of Government vs. Hongkong & Shanghai Bank was decided by a bare majority
of four justices against three, the present trend seems to be that the
With regret and with due recognition of the merit of the opinion of the Court, I constitutional requirement is to be given the liberal test as indicated in the
find myself unable to give my assent. Hence these few words to express my majority opinion penned by Justice Abad Santos, and not the strict test as
stand. desired by the majority headed by Justice Laurel.

Republic Act No. 4790 deals with one subject matter, the creation of the Such a trend has been reflected in subsequent decisions beginning
municipality of Dianaton in the province of Lanao del Sur. The title makes with Sumulong v. Commission on Elections,5 up to and including Felwa vs.
evident what is the subject matter of such an enactment. The mere fact that in Salas, a 1966 decision,6 the opinion coming from Justice Concepcion.
the body of such statute barrios found in two other municipalities of another
province were included does not of itself suffice for a finding of nullity by virtueIt is true of course that in Philconsa v. Gimenez,7 one of the grounds on which
of the constitutional provision invoked. At the most, the statute to be free from the invalidity of Republic Act No. 3836 was predicated was the violation of the
the insubstantial doubts about its validity must be construed as not including above constitutional provision. This Retirement Act for senators and
the barrios, located not in the municipalities of Butig and Balabagan, Lanao del representatives was entitled "AN ACT AMENDING SUB-SECTION (c),
Sur, but in Parang and Baldon, Cotabato. SECTION TWELVE OF COMMONWEALTH ACT NUMBERED ONE
HUNDRED EIGHTY-SIX, AS AMENDED BY REPUBLIC ACT NUMBERED
The constitutional requirement is that no bill which may be enacted into law THIRTY HUNDRED NINETY-SIX." As we noted, the paragraph in Republic Act
shall embrace more than one subject which shall be expressed in the title of the No. 3836 deemed objectionable "refers to members of Congress and to
bill.1 This provision is similar to those found in the Constitution of many elective officers thereof who are not members of the Government Service
American States. It is aimed against the evils, of the so-called omnibus bills, Insurance System. To provide retirement benefits, therefore, for these officials,
and log-rolling legislation, and against surreptitious or unconsidered would relate to a subject matter which is not germane to Commonwealth Act
enactments.  Where the subject of a bill is limited to a particular matter, the
2 No. 186. In other words, this portion of the amendment ( re retirement benefits
members of the legislature as well as the people should be informed of the for Members of Congress and appointive officers, such as the Secretary and
subject of proposed legislative measures. This constitutional provision thus Sergeants-at-arms for each house) is not related in any manner to the subject
precludes the insertion of riders in legislation, a rider being a provision not of Commonwealth Act No. 186 establishing the Government Service Insurance
germane to the subject matter of the bill. System and which provides for both retirement and insurance benefits to its
members." Nonetheless our opinion was careful to note that there was no
abandonment of the principle of liberality. Thus: "we are not unmindful of the
It is not to be narrowly construed though as to cripple or impede proper
fact that there has been a general disposition in all courts to construe the
legislation. The construction must be reasonable and not technical. It is
constitutional provision with reference to the subject and title of the Act,
sufficient if the title be comprehensive enough reasonably to include the
liberally."
general object which the statute seeks to effect without expressing each and
every end and means necessary for the accomplishment of that object. Mere
details need not be set forth. The legislature is not required to make the title of It would follow therefore that the challenged legislation Republic Act No. 4790
the act a complete index of its contents. The constitutional provision is satisfied is not susceptible to the indictment that the constitutional requirement as to
if all parts of an act which relates to its subject find expression in its title.3 legislation having only one subject which should be expressed in his title was
not met. The subject was the creation of the municipality of Dianaton. That was
embodied in the title.
The first decision of this Court, after the establishment of the Commonwealth of
the Philippines, in 1938, construing a provision of this nature, Government v.
Hongkong & Shanghai Bank,4 held that the inclusion of Section 11 of Act No. It is in the light of the aforementioned judicial decisions of this Court, some of
4007, the Reorganization Law, providing for the mode in which the total annual the opinions coming from jurists illustrious for their mastery of constitutional law
expenses of the Bureau of Banking may be reimbursed through assessment and their acknowledged erudition, that, with all due respect, I find the citation
levied upon all banking institutions subject to inspection by the Bank from Corpus Juris Secundum, unnecessary and far from persuasive. The State
Commissioner was not violative of such a requirement in the Jones Law, the decisions cited, I do not deem controlling, as the freedom of this Court to
previous organic act. Justice Laurel, however, vigorously dissented, his view accept or reject doctrines therein announced cannot be doubted.
Wherein does the weakness of the statute lie then? To repeat, several barrios former Chief Justices: "In the words of Mr. Chief Justice Taft, '(i)t is our duty in
of two municipalities outside Lanao del Sur were included in the municipality of the interpretation of federal statutes to reach conclusion which will avoid
Dianaton of that province. That itself would not have given rise to a serious doubt of their constitutionality', Richmond Screw Anchor Co. v. United
constitutional question considering the broad, well-high plenary powers States, 275 US 331, 346, 48 S. Ct. 194, 198, 72 L. ed. 303. . . . As phrased by
possessed by Congress to alter provincial and municipal boundaries. What Mr. Chief Justice Hughes, "if a serious doubt of constitutionality is raised, it is a
justified resort to this Court was the congressional failure to make explicit that cardinal principle that this Court will first ascertain whether a construction of the
such barrios in two municipalities located in Cotabato would thereafter form statute is fairly possible by which the question may be avoided.' Crowell v.
part of the newly created municipality of Dianaton, Lanao del Sur. Benson, 285, 296, 76 L. ed. 598, and cases cited." The prevailing doctrine then
as set forth by Justice Clark in a 1963 decision,13 is that courts "have
To avoid any doubt as to the validity of such statute, it must be construed as to consistently sought an interpretation which supports the constitutionality of
exclude from Dianaton all of such barrios mentioned in Republic Act No. 4790 legislation." Phrased differently by Justice Douglas, the judiciary favors "that
found in municipalities outside Lanao del Sur. As thus interpreted, the statute interpretation of legislation which gives it the greater change of surviving the
can meet the test of the most rigid scrutiny. Nor is this to do violence to the test of constitutionality."14
legislative intent. What was created was a new municipality from barrios named
as found in Lanao del Sur. This construction assures precisely that. It would follow then that both Philippine and American decisions unite in the
view that a legislative measure, in the language of Van Devanter "should not be
This mode of interpreting Republic Act No. 4790 finds support in basic given a construction which will imperil its validity where it is reasonably open to
principles underlying precedents, which if not precisely controlling, have a construction free from such peril."15 Republic Act No. 4790 as above construed
persuasive ring. In Radiowealth v. Agregado,8 certain provisions of the incurs no such risk and is free from the peril of nullity.
Administrative Code were interpreted and given a "construction which would be
more in harmony with the tenets of the fundamental law." In Sanchez v. Lyon So I would view the matter, with all due acknowledgment of the practical
Construction,9 this Court had a similar ruling: "Article 302 of the Code of considerations clearly brought to light in the opinion of the Court.
Commerce must be applied in consonance with [the relevant] provisions of our
Constitution." The above principle gained acceptance at a much earlier period
in our constitutional history. Thus in a 1913 decision, In re Guariña:10 "In
construing a statute enacted by the Philippine Commission we deem it our duty
not to give it a construction which would be repugnant to an Act of Congress, if
the language of the statute is fairly susceptible of another construction not in
conflict with the higher law. In doing so, we think we should not hesitate to
disregard contentions touching the apparent intention of the legislator which
would lead to the conclusion that the Commission intended to enact a law in
violation of the Act of Congress. However specious the argument may be in
favor of one of two possible constructions, it must be disregarded if on
examination it is found to rest on the contention that the legislator designed an
attempt to transcend the rightful limits of his authority, and that his apparent
intention was to enact an invalid law."

American Supreme Court decisions are equally explicit. The then Justice, later
Chief Justice, Stone, construed statutes "with an eye to possible constitutional
limitations so as to avoid doubts as to [their] validity."11 From the pen of the
articulate jurist, Frankfurter:12 "Accordingly, the phrase "lobbying activities" in
the resolution must be given the meaning that may fairly be attributed to it,
having special regard for the principle of constitutional adjudication which
makes it decisive in the choice of fair alternatives that one construction may
raise serious constitutional questions avoided by another." His opinion in the
Rumely case continues with the above pronouncement of Stone and two other
THE PEOPLE OF THE PHILIPPINES, ABUNDIO R. ELLO, As 4th Assistant
of Provincial Bohol VICENTE DE LA SERNA. JR., as complainant all
private prosecutor, petitioners,
vs.
HON. VICENTE B. ECHAVES, JR., as Judge of the Court of First Instance
of Bohol Branch II, ANO DACULLO, GERONIMO OROYAN, MARIO
APARICI, RUPERTO CAJES and MODESTO S SUELLO, respondents.
AQUINO, J.:p
The legal issue in this case is whether Presidential Decree No. 772, which penalizes squatting and similar acts,
applies to agricultural lands. The decree (which took effect on August 20, 1975) provides:
SECTION 1. Any person who, with the use of force, intimidation
or threat, or taking advantage of the absence or tolerance of the
landowner, succeeds in occupying or possessing the property
of the latter against his will for residential, commercial or any
other purposes, shall be punished by an imprisonment ranging
from six months to one year or a fine of not less than one
thousand nor more than five thousand pesos at the discretion of
the court, with subsidiary imprisonment in case of insolvency.
(2nd paragraph is omitted.)
The record shows that on October 25, 1977 Fiscal Abundio R. Ello filed with the
lower court separate informations against sixteen persons charging them with
squatting as penalized by Presidential Decree No. 772. The information against
Mario Aparici which is similar to the other fifteen informations, reads:
That sometime in the year 1974 continuously up to the present
at barangay Magsaysay, municipality of Talibon, province of
Bohol, Philippines and within the jurisdiction of this Honorable
Court, the above-named accused, with stealth and strategy,
enter into, occupy and cultivate a portion of a grazing land
physically occupied, possessed and claimed by Atty. Vicente de
la Serna, Jr. as successor to the pasture applicant Celestino de
la Serna of Pasture Lease Application No. 8919, accused's
entrance into the area has been and is still against the win of
the offended party; did then and there willfully, unlawfully, and
feloniously squat and cultivate a portion of the said grazing
land; said cultivating has rendered a nuisance to and has
deprived the pasture applicant from the full use thereof for
which the land applied for has been intended, that is preventing
applicant's cattle from grazing the whole area, thereby causing
damage and prejudice to the said applicant-possessor-
occupant, Atty. Vicente de la Serna, Jr. (sic)
Five of the informations, wherein Ano Dacullo, Geronimo Oroyan, Mario
Aparici, Ruperto Cajes and Modesto Suello were the accused, were raffled to
Judge Vicente B. Echaves, Jr. of Branch II (Criminal Cases Nos. 1824, 1828,
1832, 1833 and 1839, respectively).
Before the accused could be arraigned, Judge Echaves motu proprio issued an
omnibus order dated December 9, 1977 dismissing the five informations on the
grounds (1) that it was alleged that the accused entered the land through
"stealth and strategy", whereas under the decree the entry should be effected
"with the use of force, intimidation or threat, or taking advantage of the absence
or tolerance of the landowner", and (2) that under the rule of ejusdem
generis the decree does not apply to the cultivation of a grazing land.
Because of that order, the fiscal amended the informations by using in lieu of
"stealth and strategy" the expression "with threat, and taking advantage of the
absence of the ranchowner and/or tolerance of the said ranchowner". The fiscal
asked that the dismissal order be reconsidered and that the amended
informations be admitted.
The lower court denied the motion. It insisted that the phrase "and for other
purposes" in the decree does not include agricultural purposes because its
preamble does not mention the Secretary of Agriculture and makes reference
to the affluent class.
From the order of dismissal, the fiscal appealed to this Court under Republic
Act No. 5440. The appeal is devoid of merit.
We hold that the lower court correctly ruled that the decree does not apply to
pasture lands because its preamble shows that it was intended to apply to
squatting in urban communities or more particularly to illegal constructions in
squatter areas made by well-to-do individuals. The squating complained of
involves pasture lands in rural areas.
The preamble of the decree is quoted below:
WHEREAS, it came to my knowledge that despite the issuance
of Letter of Instruction No. 19 dated October 2, 1972, directing
the Secretaries of National Defense, Public Work. 9 and
communications, Social Welfare and the Director of Public
Works, the PHHC General Manager, the Presidential Assistant
on Housing and Rehabilitation Agency, Governors, City and
Municipal Mayors, and City and District Engineers, "to remove
an illegal constructions including buildings on and along esteros
and river banks, those along railroad tracks and those built
without permits on public and private property." squatting is still
a major problem in urban communities all over the country;
WHEREAS, many persons or entities found to have been
unlawfully occupying public and private lands belong to the
affluent class;
WHEREAS, there is a need to further intensify the
government's drive against this illegal and nefarious practice.
It should be stressed that Letter of Instruction No. 19 refers to illegal
constructions on public and private property. It is complemented by Letter of
Instruction No. 19-A which provides for the relocation of squatters in the
interest of public health, safety and peace and order.
On the other hand, it should be noted that squatting on public agricultural lands,
like the grazing lands involved in this case, is punished by Republic Act No.
947 which makes it unlawful for any person, corporation or association to
forcibly enter or occupy public agricultural lands. That law provides:
 SECTION 1. It shall be unlawful for any person corporation or
association to enter or occupy, through force, intimidation,
threat, strategy or stealth, any public agriculture land including
such public lands as are granted to private individuals under the
provision of the Public Land Act or any other laws providing for
the of public agriculture lands in the Philippines and are duly
covered by the corresponding applications for the
notwithstanding standing the fact that title thereto still remains in
the Government or for any person, natural or judicial to
investigate induce or force another to commit such acts.
Violations of the law are punished by a fine of not exceeding one thousand or
imprisonment for not more than one year, or both such fine and imprisonment
in the discretion of the court, with subsidiary imprisonment in case of
insolvency. (See People vs. Lapasaran 100 Phil. 40.)
The rule of ejusdem generis (of the same kind or species) invoked by the trial
court does not apply to this case. Here, the intent of the decree is
unmistakable. It is intended to apply only to urban communities, particularly to
illegal constructions. The rule of ejusdem generis is merely a tool of statutory
construction which is resorted to when the legislative intent is uncertain
(Genato Commercial Corp. vs. Court of Tax Appeals, 104 Phil. 615,618; 28
C.J.S. 1049-50).
WHEREFORE, the trial court's order of dismissal is affirmed. No costs.

SO ORDERED.
THE PEOPLE OF THE PHILIPPINES, petitioner,
vs.
HONORABLE JUDGE AMANTE P. PURISIMA, COURT OF FIRST
INSTANCE OF MANILA, BRANCH VII, and PORFIRIO CANDELOSAS,
NESTOR BAES, ELIAS L. GARCIA, SIMEON BUNDALIAN, JR., JOSEPH
C. MAISO, EDUARDO A. LIBORDO, ROMEO L. SUGAY, FEDERICO T.
DIZON, GEORGE M. ALBINO, MARIANO COTIA, JR., ARMANDO L.
DIZON, ROGELIO B. PARENO, RODRIGO V. ESTRADA, ALFREDO A.
REYES, JOSE A. BACARRA, REYNALDO BOGTONG, and EDGARDO
M. MENDOZA, respondents.
G.R. No. L-46229-32 November 20, 1978
MUÑOZ PALMA, J.:
These twenty-six (26) Petitions for Review filed by the People of the
Philippines represented, respectively, by the Office of the City Fiscal of
Manila, the Office of the Provincial Fiscal of Samar, and joined by the
Solicitor General, are consolidated in this one Decision as they involve one
basic question of law.
These Petitions or appeals involve three Courts of First Instance, namely:
the Court of First Instance of Manila, Branch VII, presided by Hon. Amante
P. Purisima (17 Petitions), the Court of First Instance of Manila, Branch
XVIII, presided by Hon. Maximo A. Maceren (8 Petitions) and, the Court of
First Instance of Samar, with Hon. Wenceslao M. Polo, presiding, (1
Petition).
Before those courts, Informations were filed charging the respective
accused with "illegal possession of deadly weapon" in violation of
Presidential Decree No. 9. On a motion to quash filed by the accused, the
three Judges mentioned above issued in the respective cases filed before
them — the details of which will be recounted below — an Order quashing
or dismissing the Informations, on a common ground, viz, that the
Information did not allege facts which constitute the offense penalized by
Presidential Decree No. 9 because it failed to state one essential element of
the crime.
Thus, are the Informations filed by the People sufficient in form and
substance to constitute the offense of "illegal possession of deadly weapon" CRIM. CASE NO. 29677
penalized under Presidential Decree (PD for short) No. 9? This is the
central issue which we shall resolve and dispose of, all other corollary
matters not being indispensable for the moment.
A — The Information filed by the People —
1. In L-42050-66, one typical Information filed with the Court presided by
Judge Purisima follows:
THE PEOPLE OF THE PHILIPPINES, plaintiff, versus PORFIRIO
CANDELOSAS Y DURAN, accused.
Crim. Case No. 19639
VIOLATION OF PAR. 3, PRES. DECREE No. 9 OF PROCLAMATION 1081
INFORMATION
The undersigned accuses PORFIRIO CANDELOSAS Y DURAN of a
violation of paragraph 3, Presidential Decree No. 9 of Proclamation 1081,
committed as follows:
That on or about the 14 th day of December, 1974, in the City of Manila,
Philippines, the said accused did then and there wilfully, unlawfully,
feloniously and knowingly have in his possession and under his custody
and control one (1) carving knife with a blade of 6-½ inches and a wooden
handle of 5-1/4 inches, or an overall length of 11-¾ inches, which the said
accused carried outside of his residence, the said weapon not being used
as a tool or implement necessary to earn his livelihood nor being used in
connection therewith.
Contrary to law. (p. 32, rollo of L-42050-66)
The other Informations are similarly worded except for the name of the
accused, the date and place of the commission of the crime, and the kind of
weapon involved.
2. In L-46229-32 and L-46313-16, the Information filed with the Court
presided by Judge Maceren follows:
THE PEOPLE OF THE PHILIPPINES, plaintiff, versus REYNALDO LAQUI
Y AQUINO, accused.
VIOL. OF PAR. 3,
PD 9 IN REL. TO LOI
 The undersigned First Assistant Provincial Fiscal of Samar, accuses
No. 266 of the Chief PANCHITO REFUNCION of the crime of ILLEGAL POSSESSION OF
DEADLY WEAPON or VIOLATION OF PD NO. 9 issued by the President of
Executive dated April 1, 1975 the Philippines on Oct. 2, 1972, pursuant to Proclamation No. 1081 dated
Sept. 21 and 23, 1972, committed as follows:
INFORMATION
That on or about the 6th day of October, 1976, in the evening at Barangay
The undersigned accuses REYNALDO LAQUI Y AQUINO of a VIOLATION Barruz, Municipality of Matuginao, Province of Samar Philippines, and
OF PARAGRAPH 3, PRESIDENTIAL DECREE NO. 9 in relation to Letter of within the jurisdiction of this Honorabe Court, the abovenamed accused,
Instruction No. 266 of the Chief Executive dated April 1, 1975, committed as knowingly, wilfully, unlawfully and feloniously carried with him outside of his
follows: residence a deadly weapon called socyatan, an instrument which from its
very nature is no such as could be used as a necessary tool or instrument
That on or about the 28 th day of January, 1977, in the City of Manila, to earn a livelihood, which act committed by the accused is a Violation of
Philippines, the said accused did then and there wilfully, unlawfully and Presidential Decree No. 9.
knowingly carry outside of his residence a bladed and pointed weapon, to
wit: an ice pick with an overall length of about 8½ inches, the same not CONTRARY TO LAW. (p. 8, rollo of L-46997)
being used as a necessary tool or implement to earn his livelihood nor
being used in connection therewith. B. — The Orders of dismissal —

Contrary to law. (p. 14, rollo of L-46229-32)
The other Informations are likewise similarly worded except for the name of
the accused, the date and place of the commission of the crime, and the
kind of weapon involved.
3. In L-46997, the Information before the Court of First Instance of Samar is
quoted hereunder:
In dismissing or quashing the Informations the trial courts concurred with
the submittal of the defense that one essential element of the offense
charged is missing from the Information, viz: that the carrying outside of the
accused's residence of a bladed, pointed or blunt weapon is in furtherance
or on the occasion of, connected with or related to subversion, insurrection,
or rebellion, organized lawlessness or public disorder.
1. Judge Purisima reasoned out, inter alia, in this manner:

PEOPLE OF THE PHILIPPINES, complainant, versus PANCHITO ... the Court is of the opinion that in order that possession of bladed weapon
REFUNCION, accused. or the like outside residence may be prosecuted and tried under P.D. No. 9,
the information must specifically allege that the possession of bladed
CRIM. CASE NO. 933 weapon charged was for the purpose of abetting, or in furtherance of the
conditions of rampant criminality, organized lawlessness, public disorder,
For: etc. as are contemplated and recited in Proclamation No. 1081, as
justification therefor. Devoid of this specific allegation, not necessarily in the
ILLEGAL POSSESSION OF same words, the information is not complete, as it does not allege sufficient
facts to constitute the offense contemplated in P.D. No. 9. The information
DEADLY WEAPON in these cases under consideration suffer from this defect.

(VIOLATION OF PD NO. 9) xxx xxx xxx

INFORMATION And while there is no proof of it before the Court, it is not difficult to believe
the murmurings of detained persons brought to Court upon a charge of
possession of bladed weapons under P.D. No. 9, that more than ever
before, policemen - of course not all can be so heartless — now have in
their hands P.D. No. 9 as a most convenient tool for extortion, what with the
terrifying risk of being sentenced to imprisonment of five to ten years for a
rusted kitchen knife or a pair of scissors, which only God knows where it
came from. Whereas before martial law an extortion-minded peace officer
had to have a stock of the cheapest paltik, and even that could only convey
the coercive message of one year in jail, now anything that has the
semblance of a sharp edge or pointed object, available even in trash cans,
may already serve the same purpose, and yet five to ten times more
incriminating than the infamous paltik.
For sure, P.D. No. 9 was conceived with the best of intentions and wisely
applied, its necessity can never be assailed. But it seems it is back-firing,
because it is too hot in the hands of policemen who are inclined to
backsliding.
The checkvalves against abuse of P.D. No. 9 are to be found in the heart of
the Fiscal and the conscience of the Court, and hence this resolution, let
alone technical legal basis, is prompted by the desire of this Court to apply
said checkvalves. (pp. 55-57, rollo of L-42050-66)
2. Judge Maceren in turn gave his grounds for dismissing the charges as
follows:
xxx xxx xxx
As earlier noted the "desired result" sought to be attained by Proclamation
No. 1081 is the maintenance of law and order throughout the Philippines
and the prevention and suppression of all forms of lawless violence as well
as any act of insurrection or rebellion. It is therefore reasonable to conclude
from the foregoing premises that the carrying of bladed, pointed or blunt
weapons outside of one's residence which is made unlawful and punishable
by said par. 3 of P.D. No. 9 is one that abets subversion, insurrection or
rebellion, lawless violence, criminality, chaos and public disorder or is
intended to bring about these conditions. This conclusion is further
strengthened by the fact that all previously existing laws that also made the
carrying of similar weapons punishable have not been repealed, whether
expressly or impliedly. It is noteworthy that Presidential Decree No. 9 does
not contain any repealing clause or provisions.
xxx xxx xxx
The mere carrying outside of one's residence of these deadly weapons if
not concealed in one's person and if not carried in any of the aforesaid
specified places, would appear to be not unlawful and punishable by law.
With the promulgation of Presidential Decree No. 9, however, the
prosecution, through Assistant Fiscal Hilario H. Laqui, contends in his
opposition to the motion to quash, that this act is now made unlawful and
punishable, particularly by paragraph 3 thereof, regardless of the intention
of the person carrying such weapon because the law makes it "mala
prohibita". If the contention of the prosecution is correct, then if a person
happens to be caught while on his way home by law enforcement officers
carrying a kitchen knife that said person had just bought from a store in
order that the same may be used by one's cook for preparing the meals in
one's home, such person will be liable for punishment with such a severe
penalty as imprisonment from five to ten years under the decree. Such
person cannot claim that said knife is going to be used by him to earn a
livelihood because he intended it merely for use by his cook in preparing his
meals.
This possibility cannot be discounted if Presidential Decree No. 9 were to
be interpreted and applied in the manner that that the prosecution wants it
to be done. The good intentions of the President in promulgating this
decree may thus be perverted by some unscrupulous law enforcement
officers. It may be used as a tool of oppression and tyranny or of extortion.
xxx xxx xxx
It is therefore the considered and humble view of this Court that the act
which the President intended to make unlawful and punishable by
Presidential Decree No. 9, particularly by paragraph 3 thereof, is one that
abets or is intended to abet subversion, rebellion, insurrection, lawless
violence, criminality, chaos and public disorder. (pp. 28-30, rollo of L-46229-
32)
3. Judge Polo of the Court of First Instance of Samar expounded his order
dismissing the Information filed before him, thus:
... We believe that to constitute an offense under the aforcited Presidential
decree, the same should be or there should be an allegation that a felony
was committed in connection or in furtherance of subversion, rebellion,
insurrection, lawless violence and public disorder. Precisely Proclamation
No. 1081 declaring a state of martial law throughout the country was issued
because of wanton destruction to lives and properties widespread
lawlessness and anarchy. And in order to restore the tranquility and stability
of the country and to secure the people from violence anti loss of lives in
the quickest possible manner and time, carrying firearms, explosives and
deadly weapons without a permit unless the same would fall under the
exception is prohibited. This conclusion becomes more compelling when we
consider the penalty imposable, which is from five years to ten years. A
strict enforcement of the provision of the said law would mean the
imposition of the Draconian penalty upon the accused.
xxx xxx xxx
It is public knowledge that in rural areas, even before and during martial
law, as a matter of status symbol, carrying deadly weapons is very
common, not necessarily for committing a crime nor as their farm implement
but for self-preservation or self-defense if necessity would arise specially in
going to and from their farm. (pp. 18-19, rollo of L-46997)
In most if not all of the cases, the orders of dismissal were given before
arraignment of the accused. In the criminal case before the Court of (First
Instance of Samar the accused was arraigned but at the same time moved
to quash the Information. In all the cases where the accused were under
arrest, the three Judges ordered their immediate release unless held on
other charges.
C. — The law under which the Informations in question were filed by the
People.
As seen from the Informations quoted above, the accused are charged with
illegal possession of deadly weapon in violation of Presidential Decree No.
9, Paragraph 3.
We quote in full Presidential Decree No. 9, to wit:
WHEREAS, by virtue of said Proclamation No. 1081, General Order No. 6
dated September 22, 1972 and General Order No. 7 dated September 23,
1972, have been promulgated by me;
WHEREAS, subversion, rebellion, insurrection, lawless violence, criminality,
chaos and public disorder mentioned in the aforesaid Proclamation No.
1081 are committed and abetted by the use of firearms, explosives and
other deadly weapons;
NOW, THEREFORE, I, FERDINAND E. MARCOS, Commander-in-Chief of
all the Armed Forces of the Philippines, in older to attain the desired result
of the aforesaid Proclamation No. 1081 and General Orders Nos. 6 and 7,
do hereby order and decree that:
1. Any violation of the aforesaid General Orders Nos. 6 and 7 is unlawful
and the violator shall, upon conviction suffer:
(a) The mandatory penalty of death by a firing squad or electrocution as a
Military, Court/Tribunal/Commission may direct, it the firearm involved in the
violation is unlicensed and is attended by assault upon, or resistance to
persons in authority or their agents in the performance of their official
functions resulting in death to said persons in authority or their agent; or if
such unlicensed firearm is used in the commission of crimes against
persons, property or chastity causing the death of the victim used in
violation of any other General Orders and/or Letters of Instructions
promulgated under said Proclamation No. 1081:
(b) The penalty of imprisonment ranging from twenty years to life
imprisonment as a Military Court/Tribunal/commission may direct, when the
violation is not attended by any of the circumstances enumerated under the
preceding paragraph;

PRESIDENTIAL DECREE NO. 9
DECLARING VIOLATIONS OF GENERAL ORDERS NO. 6 and NO. 7
DATED SEPTEMBER 22, 1972, AND SEPTEMBER 23, 1972,
RESPECTIVELY, TO BE UNLAWFUL AND PROVIDING PENALTIES
THEREFORE.
(c) The penalty provided for in the preceding paragraphs shall be imposed
upon the owner, president, manager, members of the board of directors or
other responsible officers of any public or private firms, companies,
corporations or entities who shall willfully or knowingly allow any of the
firearms owned by such firm, company, corporation or entity concerned to
be used in violation of said General Orders Nos. 6 and 7.

WHEREAS, pursuant to Proclamation No. 1081 dated September 21, 1972, 2. It is unlawful to posses deadly weapons, including hand grenades, rifle
the Philippines has been placed under a state of martial law; grenades and other explosives, including, but not limited to, "pill box
bombs," "molotov cocktail bombs," "fire bombs," or other incendiary device
consisting of any chemical, chemical compound, or detonating agents
containing combustible units or other ingredients in such proportion,
quantity, packing, or bottling that ignites by fire, by friction, by concussion,
by percussion, or by detonation of all or part of the compound or mixture
which may cause such a sudden generation of highly heated gases that the
resultant gaseous pressures are capable of producing destructive effects on
continguous objects or of causing injury or death of a person; and any
person convicted thereof shall be punished by imprisonment ranging from
ten to fifteen years as a Military Court/Tribunal/Commission may direct.
3. It is unlawful to carry outside of residence any bladed, pointed or blunt
weapon such as "fan knife," "spear," "dagger," "bolo," "balisong," "barong,"
"kris," or club, except where such articles are being used as necessary tools
or implements to earn a livelihood and while being used in connection
therewith; and any person found guilty thereof shall suffer the penalty of
imprisonment ranging from five to ten years as a Military
Court/Tribunal/Commission may direct.
4. When the violation penalized in the preceding paragraphs 2 and 3 is
committed during the commission of or for the purpose of committing, any
other crime, the penalty shall be imposed upon the offender in its maximum
extent, in addition to the penalty provided for the particular offenses
committed or intended to be committed.
Done in the City of Manila, this 2nd day of October in the year of Our Lord,
nineteen hundred and seventy-two.
(SGD) FERDINAND E. MARCOS
President
Republic of the Philippines
D. — The arguments of the People —
In the Comment filed in these cases by the Solicitor General who as stated
earlier joins the City Fiscal of Manila and the Provincial Fiscal of Samar in
seeking the setting aside of the questioned orders of dismissal, the main
argument advanced on the issue now under consideration is that a perusal
of paragraph 3 of P.D. 9 'shows that the prohibited acts need not be related
to subversive activities; that the act proscribed is essentially a malum
prohibitum penalized for reasons of public policy.1
The City Fiscal of Manila in his brief adds further that in statutory offenses
the intention of the accused who commits the act is immaterial; that it is
enough if the prohibited act is voluntarily perpetuated; that P.D. 9 provides
and condemns not only the carrying of said weapon in connection with the
commission of the crime of subversion or the like, but also that of criminality
in general, that is, to eradicate lawless violence which characterized pre-
martial law days. It is also argued that the real nature of the criminal charge
is determined not from the caption or preamble of the information nor from
the specification of the provision of law alleged to have been violated but by
the actual recital of facts in the complaint or information.2
E. — Our Ruling on the matter —
1. It is a constitutional right of any person who stands charged in a criminal
prosecution to be informed of the nature and cause of the accusation
against him.3
Pursuant to the above, Section 5, Rule 110 of the Rules of Court, expressly
requires that for a complaint or information to be sufficient it must, inter alia
state the designation of the offense by the statute, and the acts or
omissions complained of as constituting the offense. This is essential to
avoid surprise on the accused and to afford him the opportunity to prepare
his defense accordingly. 4
To comply with these fundamental requirements of the Constitution and the
Rules on Criminal Procedure, it is imperative for the specific statute violated
to be designated or mentioned 4 in the charge. In fact, another compelling
reason exists why a specification of the statute violated is essential in these
cases. As stated in the order of respondent Judge Maceren the carrying of
so-called "deadly weapons" is the subject of another penal statute and a
Manila city ordinance. Thus, Section 26 of Act No. 1780 provides:
Section 26. It should be unlawful for any person to carry concealed about
his person any bowie knife, dirk dagger, kris, or other deadly weapon: ...
Any person violating the provisions of this section shall, upon conviction in a
court of competent jurisdiction, be punished by a fine not exceeding five
hundred pesos, or by imprisonment for a period not exceeding six months,
or both such fine and imprisonment, in the discretion of the court.
Ordinance No. 3820 of the City of Manila as amended by Ordinance No.
3928 which took effect on December 4, 1957, in turn penalizes with a fine of
not more than P200.00 or imprisonment for not more than one months, or
both, at the discretion of the court, anyone who shall carry concealed in his
person in any manner that would disguise its deadly character any kind of
firearm, bowie knife, or other deadly weapon ... in any public place.
Consequently, it is necessary that the particular law violated be specified as
there exists a substantial difference between the statute and city ordinance
on the one hand and P.D. 9 (3) on the other regarding the circumstances of
the commission of the crime and the penalty imposed for the offense.
We do not agree with petitioner that the above-mentioned statute and the
city ordinance are deemed repealed by P.D. 9 (3). 5 P. D. 9(3) does not
contain any repealing clause or provision, and repeal by implication is not
favored. 6 This principle holds true with greater force with regards to penal
statutes which as a rule are to be construed strictly against the state and
liberally in favor of the accused. 7 In fact, Article 7 of the New Civil Code
provides that laws are repealed only by subsequent ones and their violation
or non- observance shall not be excused by disuse, or custom or practice to
the contrary.
Thus we are faced with the situation where a particular act may be made to
fall, at the discretion of a police officer or a prosecuting fiscal, under the
statute, or the city ordinance, or the presidential decree. That being the
case, the right becomes more compelling for an accused to be confronted
with the facts constituting the essential elements of the offense charged
against him, if he is not to become an easy pawn of oppression and
harassment, or of negligent or misguided official action — a fear
understandably shared by respondent Judges who by the nature of their
judicial functions are daily exposed to such dangers.
2. In all the Informations filed by petitioner the accused are charged in the
caption as well as in the body of the Information with a violation of
paragraph 3, P.D. 9. What then are the elements of the offense treated in
the presidential decree in question?
We hold that the offense carries two elements: first, the carrying outside
one's residence of any bladed, blunt, or pointed weapon, etc. not used as a
necessary tool or implement for a livelihood; and second, that the act of
carrying the weapon was either in furtherance of, or to abet, or in
connection with subversion, rebellion, insurrection, lawless violence,
criminality, chaos, or public disorder.
It is the second element which removes the act of carrying a deadly
weapon, if concealed, outside of the scope of the statute or the city
ordinance mentioned above. In other words, a simple act of carrying any of
the weapons described in the presidential decree is not a criminal offense in
itself. What makes the act criminal or punishable under the decree is the
motivation behind it. Without that motivation, the act falls within the purview
of the city ordinance or some statute when the circumstances so warrant.
Respondent Judges correctly ruled that this can be the only reasonably,
logical, and valid construction given to P.D. 9(3).
3. The position taken by petitioner that P.D. 9(3) covers one and all
situations where a person carries outside his residence any of the weapons
mentioned or described in the decree irrespective of motivation, intent, or
purpose, converts these cases into one of "statutory construction." That
there is ambiguity in the presidential decree is manifest from the conflicting
views which arise from its implementation. When ambiguity exists, it
becomes a judicial task to construe and interpret the true meaning and
scope of the measure, guided by the basic principle that penal statutes are
to be construed and applied liberally in favor of the accused and strictly
against the state.
4. In the construction or interpretation of a legislative measure — a
presidential decree in these cases — the primary rule is to search for and
determine the intent and spirit of the law. Legislative intent is the controlling
factor, for in the words of this Court in Hidalgo v. Hidalgo, per Mr. Justice
Claudio Teehankee, whatever is within the spirit of a statute is within the
statute, and this has to be so if strict adherence to the letter would result in
absurdity, injustice and contradictions. 8
There are certain aids available to Us to ascertain the intent or reason for
P.D. 9(3).
First, the presence of events which led to or precipitated the enactment of
P.D. 9. These events are clearly spelled out in the "Whereas" clauses of the
presidential decree, thus: (1) the state of martial law in the country pursuant
to Proclamation 1081 dated September 21, 1972; (2) the desired result of
Proclamation 1081 as well as General Orders Nos. 6 and 7 which are
particularly mentioned in P.D. 9; and (3) the alleged fact that subversion,
rebellion, insurrection, lawless violence, criminality, chaos, aid public
disorder mentioned in Proclamation 1081 are committed and abetted by the
use of firearms and explosives and other deadly weapons.
The Solicitor General however contends that a preamble of a statute
usually introduced by the word "whereas", is not an essential part of an act
and cannot enlarge or confer powers, or cure inherent defects in the statute
(p. 120, rollo of L-42050-66); that the explanatory note or enacting clause of
the decree, if it indeed limits the violation of the decree, cannot prevail over
the text itself inasmuch as such explanatory note merely states or explains
the reason which prompted the issuance of the decree. (pp. 114-115, rollo
of 46997)
We disagree with these contentions. Because of the problem of determining 7. General Orders Nos. 6 and 7 refer to firearms and therefore have no
what acts fall within the purview of P.D. 9, it becomes necessary to inquire relevance to P.D. 9(3) which refers to blunt or bladed weapons. With
into the intent and spirit of the decree and this can be found among others respect to Proclamation 1081 some of the underlying reasons for its
in the preamble or, whereas" clauses which enumerate the facts or events issuance are quoted hereunder:
which justify the promulgation of the decree and the stiff sanctions stated
therein. WHEREAS, these lawless elements having taken up arms against our duly
constituted government and against our people, and having committed and
A "preamble" is the key of the statute, to open the minds of the makers as are still committing acts of armed insurrection and rebellion consisting of
to the mischiefs which are to be remedied, and objects which are to be armed raids, forays, sorties, ambushes, wanton acts of murders, spoilage,
accomplished, by the provisions of the statute." (West Norman Timber v. plunder, looting, arsons, destruction of public and private buildings, and
State, 224 P. 2d 635, 639, cited in Words and Phrases, "Preamble"; attacks against innocent and defenseless civilian lives and property, all of
emphasis supplied) which activities have seriously endangered and continue to endanger public
order and safety and the security of the nation, ...
While the preamble of a statute is not strictly a part thereof, it may, when
the statute is in itself ambiguous and difficult of interpretation, be resorted xxx xxx xxx
to, but not to create a doubt or uncertainty which otherwise does not exist."
(James v. Du Bois, 16 N.J.L. (1 Har.) 285, 294, cited in Words and Phrases, WHEREAS, it is evident that there is throughout the land a state of anarchy
"Preamble") and lawlessness, chaos and disorder, turmoil and destruction of a
magnitude equivalent to an actual war between the forces of our duly
In Aboitiz Shipping Corporation, et al. v. The City of Cebu, et al. this Court constituted government and the New People's Army and their satellite
had occasion to state that '(L)egislative intent must be ascertained from a organizations because of the unmitigated forays, raids, ambuscades,
consideration of the statute as a whole, and not of an isolated part or a assaults, violence, murders, assassinations, acts of terror, deceits,
particular provision alone. This is a cardinal rule of statutory construction. coercions, threats, intimidations, treachery, machinations, arsons, plunders
For taken in the abstract, a word or phrase might easily convey a meaning and depredations committed and being committed by the aforesaid lawless
quite different from the one actually intended and evident when the word or elements who have pledged to the whole nation that they will not stop their
phrase is considered with those with which it is associated. Thus, an dastardly effort and scheme until and unless they have fully attained their
apparently general provision may have a limited application if read together primary and ultimate purpose of forcibly seizing political and state power in
with other provisions. 9 this country by overthrowing our present duly constituted government, ...
(See Book I, Vital Documents on the Declaration of Martial Law in the
Second, the result or effects of the presidential decree must be within its Philippines by the Supreme Court of the Philippines, pp. 13-39)
reason or intent.
It follows that it is only that act of carrying a blunt or bladed weapon with a
In the paragraph immediately following the last "Whereas" clause, the motivation connected with or related to the afore-quoted desired result of
presidential decree states: Proclamation 1081 that is within the intent of P.D. 9(3), and nothing else.

NOW, THEREFORE, I , FERDINAND E. MARCOS, Commander-in-Chief of Statutes are to be construed in the light of purposes to be achieved and the
an the Armed Forces of the Philippines, in order to attain the desired result evils sought to be remedied. (U.S. v. American Tracking Association, 310
of the aforesaid Proclamation No. 1081 and General Orders Nos. 6 and 7, U.S. 534, cited in LVN Pictures v. Philippine Musicians Guild, 110 Phil. 725,
do hereby order and decree that: 731; emphasis supplied)

xxx xxx xxx When construing a statute, the reason for its enactment should be kept in
mind, and the statute should be construed with reference to its intended
From the above it is clear that the acts penalized in P.D. 9 are those related scope and purpose. (Statutory Construction by E.T. Crawford, pp. 604-605,
to the desired result of Proclamation 1081 and General Orders Nos. 6 and
cited in Commissioner of Internal Revenue v. Filipinas Compania de 6. Penal statutes are to be construed strictly against the state and liberally
Seguros, 107 Phil. 1055, 1060; emphasis supplied) in favor of an accused.

5. In the construction of P.D. 9(3) it becomes relevant to inquire into the American jurisprudence sets down the reason for this rule to be "the
consequences of the measure if a strict adherence to the letter of the tenderness of the law of the rights of individuals; the object is to establish a
paragraph is followed. certain rule by conformity to which mankind would be safe, and the
discretion of the court limited." 11 The purpose is not to enable a guilty
It is a salutary principle in statutory construction that there exists a valid person to escape punishment through a technicality but to provide a precise
presumption that undesirable consequences were never intended by a definition of forbidden acts.12
legislative measure, and that a construction of which the statute is fairly
susceptible is favored, which will avoid all objectionable, mischievous, Our own decisions have set down the same guidelines in this manner, viz:
indefensible, wrongful, evil, and injurious consequences.9-a
Criminal statutes are to be construed strictly. No person should be brought
It is to be presumed that when P.D. 9 was promulgated by the President of within their terms who is not clearly within them, nor should any act be
the Republic there was no intent to work a hardship or an oppressive result, pronounced criminal which is not made clearly so by the statute. (U.S. v.
a possible abuse of authority or act of oppression, arming one person with a Abad Santos, 36 Phil. 243, 246)
weapon to impose hardship on another, and so on.10
The rule that penal statutes are given a strict construction is not the only
At this instance We quote from the order of Judge Purisima the following: factor controlling the interpretation of such laws, instead, the rule merely
serves as an additional, single factor to be considered as an aid in
And while there is no proof of it before the Court, it is not difficult to believe determining the meaning of penal laws. (People v. Manantan, 5 SCRA 684,
the murmurings of detained persons brought to Court upon a charge of 692)
possession of bladed weapons under P.D. No. 9, that more than ever
before, policemen - of course not all can be so heartless — now have in F. The Informations filed by petitioner are fatally defective.
their hands P.D. No. 9 as a most convenient tool for extortion, what with the
terrifying risk of being sentenced to imprisonment of five to ten years for a The two elements of the offense covered by P.D. 9(3) must be alleged in
rusted kitchen knife or a pair of scissors, which only God knows where it the Information in order that the latter may constitute a sufficiently valid
came from. Whereas before martial law an extortion-minded peace officer charged. The sufficiency of an Information is determined solely by the facts
had to have a stock of the cheapest paltik, and even that could only convey alleged therein.13 Where the facts are incomplete and do not convey the
the coercive message of one year in jail, now anything that has the elements of the crime, the quashing of the accusation is in order.
semblance of a sharp edge or pointed object, available even in trash cans,
may already serve the same purpose, and yet five to ten times more Section 2(a), Rule 117 of the Rules of Court provides that the defendant
incriminating than the infamous paltik. (pp. 72-73, rollo L-42050-66) may move to quash the complaint or information when the facts charged do
not constitute an offense.
And as respondent Judge Maceren points out, the people's interpretation of
P.D. 9(3) results in absurdity at times. To his example We may add a In U.S.U. Gacutan, 1914, it was held that where an accused is charged with
situation where a law-abiding citizen, a lawyer by profession, after knowingly rendering an unjust judgment under Article 204 of the Revised
gardening in his house remembers to return the bolo used by him to his Penal Code, failure to allege in the Information that the judgment was
neighbor who lives about 30 meters or so away and while crossing the rendered knowing it to be unjust, is fatal. 14
street meets a policeman. The latter upon seeing the bolo being carried by
that citizen places him under arrest and books him for a violation of P.D. In People v. Yadao, 1954, this Court through then Justice Cesar Bengzon
9(3). Could the presidential decree have been conceived to produce such who later became Chief Justice of the Court affirmed an order of the trial
absurd, unreasonable, and insensible results? court which quashed an Information wherein the facts recited did not
constitute a public offense as defined in Section 1, Republic Act 145. 15
G. The filing of these Petitions was unnecessary because the People could Under the foregoing, the filing of another complaint or Information is barred
have availed itself of other available remedies below. only when the criminal action or liability had been extinguished (Section 2[f])
or when the motion to quash was granted for reasons of double jeopardy.
Pertinent provisions of the Rules of Court follow: (ibid., [h])

Rule 117, Section 7. Effect of sustaining the motion to quash. — If the As to whether or not a plea of double jeopardy may be successfully invoked
motion to quash is sustained the court may order that another information by the accused in all these cases should new complaints be filed against
be filed. If such order is made the defendant, if in custody, shall remain so them, is a matter We need not resolve for the present.
unless he shall be admitted to bail. If such order is not made or if having
been made another information is not filed withuntime to be specified in the H. — We conclude with high expectations that police authorities and the
order, or within such further time as the court may allow for good cause prosecuting arm of the government true to the oath of office they have
shown, the defendant, if in custody, shall be discharged therefrom, unless taken will exercise utmost circumspection and good faith in evaluating the
he is in custody on some other charge. particular circumstances of a case so as to reach a fair and just conclusion
if a situation falls within the purview of P.D. 9(3) and the prosecution under
Rule 110, Section 13. Amendment. — The information or complaint may be said decree is warranted and justified. This obligation becomes a sacred
amended, in substance or form, without leave of court, at any time before duty in the face of the severe penalty imposed for the offense.
the defendant pleads; and thereafter and during the trial as to all matters of
form, by leave and at the discretion of the court, when the same can be On this point, We commend the Chief State Prosecutor Rodolfo A. Nocon
done without prejudice to the rights of the defendant. on his letter to the City Fiscal of Manila on October 15, 1975, written for the
Secretary, now Minister of Justice, where he stated the following:
xxx xxx xxx
In any case, please study well each and every case of this nature so that
Two courses of action were open to Petitioner upon the quashing of the persons accused of carrying bladed weapons, specially those whose
Informations in these cases, viz: purpose is not to subvert the duly constituted authorities, may not be unduly
indicted for the serious offenses falling under P.D. No. 9.17
First, if the evidence on hand so warranted, the People could have filed an
amended Information to include the second element of the offense as Yes, while it is not within the power of courts of justice to inquire into the
defined in the disputed orders of respondent Judges. We have ruled that if wisdom of a law, it is however a judicial task and prerogative to determine if
the facts alleged in the Information do not constitute a punishable offense, official action is within the spirit and letter of the law and if basic
the case should not be dismissed but the prosecution should be given an fundamental rights of an individual guaranteed by the Constitution are not
opportunity to amend the Information.16 violated in the process of its implementation. We have to face the fact that it
is an unwise and unjust application of a law, necessary and justified under
Second, if the facts so justified, the People could have filed a complaint prevailing circumstances, which renders the measure an instrument of
either under Section 26 of Act No. 1780, quoted earlier, or Manila City oppression and evil and leads the citizenry to lose their faith in their
Ordinance No. 3820, as amended by Ordinance No. 3928, especially since government.
in most if not all of the cases, the dismissal was made prior to arraignment
of the accused and on a motion to quash. WHEREFORE, We DENY these 26 Petitions for Review and We AFFIRM
the Orders of respondent Judges dismissing or quashing the Information
Section 8. Rule 117 states that: concerned, subject however to Our observations made in the preceding
pages 23 to 25 of this Decision regarding the right of the State or Petitioner
An order sustaining the motion to quash is not a bar to another prosecution herein to file either an amended Information under Presidential Decree No.
for the same offense unless the motion was based on the grounds specified 9, paragraph 3, or a new one under other existing statute or city ordinance
in section 2, subsections (f) and (h) of this rule. as the facts may warrant.
Without costs.

SO ORDERED.

Fernando, Teehankee, Santos, Fernandez and Guerrero, JJ., concur.

Castro, C.J. and Antonio, J, concur in the result.

Aquino, J, took no part.

Separate Opinions

BARREDO, J., concurring.

I concur with the qualification that under existing jurisprudence conviction is

possible, without the need of amending the information, for violation of other
laws or ordinances on concealment of deadly weapons.

Makasiar, J, concurs.

CONCEPCION, JR., J, concurring:

I concur with the additional observation that accused could properly be

convicted of a violation of Act 1780 of the Philippine Commission or of the
ordinance.

Separate Opinions

BARREDO, J., concurring.

I concur with the qualification that under existing jurisprudence conviction is

possible, without the need of amending the information, for violation of other
laws or ordinances on concealment of deadly weapons.

Makasiar, J, concurs.

CONCEPCION, JR., J, concurring:

I concur with the additional observation that accused could properly be

convicted of a violation of Act 1780 of the Philippine Commission or of the
ordinance.
ABOITIZ SHIPPING CORPORATION; CARLOS A. GO THONG &
COMPANY; CEBU NAVIGATION COMPANY, INC.; CEBU-BOHOL FERRY
CO., INC.; COROMINAS, RICHARDS NAVIGATION CO., INC.; HIJOS DE F.
ESCANO, INC.; PACIFIC LINES, INC.; ROYAL LINES, INC.; SOUTHERN
ISLAND SHIPPING CORPORATION; SWEET LINES SHIPPING; VISAYAN
TRANSPORTATION CO., INC.; PHILIPPINE STEAM NAVIGATION CO.;
COMPAÑIA MARITIMA; and GENERAL SHIPPING CO., INC., plaintiffs-
appellants,
vs.
THE CITY OF CEBU; FELIPE PAREJA, as City Treasurer of Cebu; THE
HON. SERGIO OSMEÑA, JR., as Mayor of the City of Cebu, defendants-
appellees.
Lichauco, Picazo and Agcaoili for plaintiffs-appellants.
Cebu City Fiscal and Quirico del Mar for defendants-appellees.
MAKALINTAL, J.:
The principal question here is whether or not under its charter, Commonwealth
Act No. 58, the City of Cebu may provide by ordinance for the collection of
wharfage from shipping concerns whose vessels dock at the public wharves of
piers located in said city but owned by the National Government. The
ordinance, No. 207, was purportedly enacted by the Municipal Board on August
14, 1956 and approved by the City Mayor on the following August 27. Plaintiffs
paid the wharfage charges under protest since September 1, 1956 and on May
8, 1957 filed this action in the Court of First Instance of Manila to have the said
ordinance declared void, its enforcement enjoined in so far as the wharves,
docks and other landing places belonging to the National Government were
concerned, and all the amounts thus far collected by defendants refunded to
them.
The court a quo dismissed the complaint after trial and the case has come to us
on appeal by plaintiffs.
Appellants have raised some questions of fact, and in particular point out
certain events and circumstances to show that ordinance No. 207 was not and
could not have been enacted, as alleged by appellees, on August 14, 1956.
This case, however, may be decided solely on the legal issue presented by the
parties.
1äwphï1.ñët
The Municipal Board's authority to pass the ordinance is claimed by appellees
under section 17 (w) of the charter of the City of Cebu, which states:
SECTION 17. General powers and duties of the Board.—Except as
otherwise provided by law, and subject to the conditions and limitations
thereof, the Municipal Board shall have the following legislative powers:
xxx     xxx     xxx
(w) To fix the charges to be paid by all watercrafts landing at or using
public wharves, docks, levees, or landing places.
The lower court ruled upholding appellees' contention in this respect, that in
using the terms "public wharves, docks, levees, or landing places," the
legislature made no distinction between those owned by the National
Government and those owned by the City of Cebu and that consequently both
fall within the scope of the power granted. Appellants assail this construction as
erroneous, first in the light of the generally accepted meaning of "public wharf"
as it may have a bearing on the right or authority to charge wharfage and,
secondly, in view of other related provisions of the same city charter.
The word "public", as employed to describe a wharf, does not refer to its
ownership either by the National Government or by a province or municipality.
It denotes rather the nature of its use. Thus public wharves have been held to
be those used generally by the public, free of charge or for compensation, while
a private wharf is one whose owner or lessee has exclusive enjoyment or use
thereof (Hamilton v. Portland State Pier Site District, 112 A. 836). Piers, or
landing places and wharves may be private or they may be in their nature,
public, although the property may be in an individual owner, where the latter is
under obligation to concede to others the privilege of landing their goods or of
mooring their vessels there, upon payment of a reasonable compensation as
wharfage (Dutton v. Strong, 17 Law Ed. 29, 1 Black 35, 66 U.S. 339). So a
wharf may be public whether it belongs to the National Government, to a
municipal corporation or to a private individual or concern.
Assuming the public character of a wharf by reason of its availability for public
use, the right to impose wharfage dues rests on a different basis — that of
ownership. For wharfage is a charge against the vessel by way of rent or
compensation for its being allowed to lie alongside a wharf for the purpose of
loading or unloading freight (Phil. Sugar Centrals Agency vs. Insular Collector
of Customs, 51 Phil. 131, citing Parkersburg and Ohio River Transportation Co.
vs. City of Parkersburg, 27 Law Ed. 584) and, of course, for the use of the
artificial facilities offered for that purpose (City of Shreveport vs. Red River and
Coast Line, 55 Am. Rep. 504). That the right to charge wharfage is based on
ownership has been impliedly recognized by this Court in Province of Mindoro
v. Cruz, 74 Phil. 108, as follows: "... the subsequent classification of the port of
Calapan as a national port did not, and was not intended to, divest the province
of Mindoro of its part ownership of the wharf and, accordingly, of its right to
collect wharfage for its use as it had theretofore done"; and "not until its
complete ownership has become vested in the National Government by the
mode of transfer provided by law may the province of Mindoro be divested of
this right."
Under the foregoing test the right to collect the wharfage in question here
belongs to the National Government, as in fact it has always collected the same
from appellants. It is unreasonable to conclude that the legislature, simply
because it employed the term "public wharves" in section 17 (w) of the charter
of the City of Cebu, thereby authorized the latter to collect wharfage
irrespective of the ownership of the wharves involved. The National
Government did not surrender such ownership to the city; and there is no
justifiable ground to read into the statute an intention to burden shipowners,
such as appellants, with the obligation of paying twice for the same purpose.
Legislative intent must be ascertained from a consideration of the statute as a
whole and not of an isolated part or a particular provision alone. This is a
cardinal rule of statutory construction. For taken in the abstract, a word or
phrase might easily convey a meaning quite different from the one actually
intended and evident when the word or phrase is considered with those with
which it is associated. Thus an apparently general provision may have a limited
application if viewed together with other provisions.
Section 17 (w) of the charter of the City of Cebu is a case in point. It authorizes
the Municipal Board to fix the charges to be paid by all watercrafts landing at or
using public wharves, docks, levees, or landing places. There is indeed no
distinction therein between public wharves owned by the National Government
and those owned by the city itself. But the subsection immediately preceding
(v) impliedly establishes such a distinction. It empowers the Municipal Board "to
provide for the construction and maintenance, and regulate the use, of public
landing places, wharves, piers, docks and levees." It seems fairly evident that
when the lawmaking body used the term "public wharves, etc." in subsection 2,
it meant to refer to those mentioned in the preceding subsection, namely, the
"public wharves, etc." constructed and therefore owned by the City of Cebu.
Section 30 of the charter has a similar bearing on the question, in granting to
the City Engineer "the care and custody of all public docks, wharves, piers,
levees, and landing places, when erected" — undoubtedly referring to those
constructed and owned by the city. For in so far as those belonging to the
National Government are concerned they remain under the exclusive control,
direction and management of the Bureau of Customs, according to section
1142 of the Revised Administrative Code. And appellants have accordingly
been paying to the National Government fees for the use of its wharves in
Cebu, pursuant to law, particularly Republic Act No. 1371 which took effect on
July 1, 1955 and was later on embodied in the new Tariff and Customs Code.
The court a quo ruled that Section 17 (w) of the city charter is "plainly evincive
of the power to tax for revenue purposes," and therefore the wharfage charges
imposed by ordinance pursuant thereto are proper even if the amounts actually
collected are much more than what may be justified as license fees under the
police power of regulation of "shipping offices" granted under section 17 (1) of
the same charter. The power to tax is an attribute of sovereignty and for it to be
exercised by a municipal corporation requires a clear delegation of the power
by means of charter grant or by a general enabling statute. The power is not
inherent in a municipal corporation (Saldaña vs. City of Iloilo, 55 O.G. 10267),
and if there is any doubt as to whether or not such power has been delegated
to it the doubt must be resolved negatively (We Wa Yu vs. City of Lipa, 54 O.G.
4055).
But even if the wharfage dues authorized under Section 17(w) be considered
as taxes for revenue, such authority nevertheless is limited to public wharves,
docks, levees and other landing places belonging to the City of Cebu and not to
those owned by the National Government under the exclusive supervision of
the Bureau of Customs.
IN VIEW OF THE FOREGOING, the judgment appealed from is reversed;
Ordinance No. 207 of the City of Cebu is declared null and void, and appellees
are ordered to refund to appellants all amounts collected thereunder and to
refrain from making such collection. Costs against appellees.
Bengzon, C.J., Bautista Angelo, Concepcion, Barrera, Paredes, Dizon, Regala,
Bengzon, J.P., and Zaldivar, JJ., concur.

LORENZO M. TAÑADA, ABRAHAM F. SARMIENTO, and MOVEMENT OF
ATTORNEYS FOR BROTHERHOOD, INTEGRITY AND NATIONALISM, INC.
[MABINI], petitioners,
vs.
HON. JUAN C. TUVERA, in his capacity as Executive Assistant to the
President, HON. JOAQUIN VENUS, in his capacity as Deputy Executive
Assistant to the President , MELQUIADES P. DE LA CRUZ, in his capacity
as Director, Malacañang Records Office, and FLORENDO S. PABLO, in
his capacity as Director, Bureau of Printing, respondents.
ESCOLIN, J.:
Invoking the people's right to be informed on matters of public concern, a right
recognized in Section 6, Article IV of the 1973 Philippine Constitution,   as well
1 g] Administrative Orders Nos.: 347, 348, 352-354, 360- 378,
as the principle that laws to be valid and enforceable must be published in the
Official Gazette or otherwise effectively promulgated, petitioners seek a writ of
mandamus to compel respondent public officials to publish, and/or cause the
publication in the Official Gazette of various presidential decrees, letters of
instructions, general orders, proclamations, executive orders, letter of
implementation and administrative orders.
Specifically, the publication of the following presidential issuances is sought:
a] Presidential Decrees Nos. 12, 22, 37, 38, 59, 64, 103, 171,
179, 184, 197, 200, 234, 265, 286, 298, 303, 312, 324, 325,
326, 337, 355, 358, 359, 360, 361, 368, 404, 406, 415, 427,
429, 445, 447, 473, 486, 491, 503, 504, 521, 528, 551, 566,
573, 574, 594, 599, 644, 658, 661, 718, 731, 733, 793, 800,
802, 835, 836, 923, 935, 961, 1017-1030, 1050, 1060-1061,
1085, 1143, 1165, 1166, 1242, 1246, 1250, 1278, 1279, 1300,
1644, 1772, 1808, 1810, 1813-1817, 1819-1826, 1829-1840,
1842-1847.
b] Letter of Instructions Nos.: 10, 39, 49, 72, 107, 108, 116, 130,
136, 141, 150, 153, 155, 161, 173, 180, 187, 188, 192, 193,
199, 202, 204, 205, 209, 211-213, 215-224, 226-228, 231-239,
241-245, 248, 251, 253-261, 263-269, 271-273, 275-283, 285-
289, 291, 293, 297-299, 301-303, 309, 312-315, 325, 327, 343,
346, 349, 357, 358, 362, 367, 370, 382, 385, 386, 396-397,
405, 438-440, 444- 445, 473, 486, 488, 498, 501, 399, 527,
561, 576, 587, 594, 599, 600, 602, 609, 610, 611, 612, 615,
641, 642, 665, 702, 712-713, 726, 837-839, 878-879, 881, 882,
939-940, 964,997,1149-1178,1180-1278.
c] General Orders Nos.: 14, 52, 58, 59, 60, 62, 63, 64 & 65.
d] Proclamation Nos.: 1126, 1144, 1147, 1151, 1196, 1270,
1281, 1319-1526, 1529, 1532, 1535, 1538, 1540-1547, 1550-
1558, 1561-1588, 1590-1595, 1594-1600, 1606-1609, 1612-
1628, 1630-1649, 1694-1695, 1697-1701, 1705-1723, 1731-
1734, 1737-1742, 1744, 1746-1751, 1752, 1754, 1762, 1764-
1787, 1789-1795, 1797, 1800, 1802-1804, 1806-1807, 1812-
1814, 1816, 1825-1826, 1829, 1831-1832, 1835-1836, 1839-
1840, 1843-1844, 1846-1847, 1849, 1853-1858, 1860, 1866,
1868, 1870, 1876-1889, 1892, 1900, 1918, 1923, 1933, 1952,
1963, 1965-1966, 1968-1984, 1986-2028, 2030-2044, 2046-
2145, 2147-2161, 2163-2244.
e] Executive Orders Nos.: 411, 413, 414, 427, 429-454, 457-
471, 474-492, 494-507, 509-510, 522, 524-528, 531-532, 536,
538, 543-544, 549, 551-553, 560, 563, 567-568, 570, 574, 593,
594, 598-604, 609, 611- 647, 649-677, 679-703, 705-707, 712-
786, 788-852, 854-857.
f] Letters of Implementation Nos.: 7, 8, 9, 10, 11-22, 25-27, 39,
50, 51, 59, 76, 80-81, 92, 94, 95, 107, 120, 122, 123.
380-433, 436-439.
The respondents, through the Solicitor General, would have this case
dismissed outright on the ground that petitioners have no legal personality or
standing to bring the instant petition. The view is submitted that in the absence
of any showing that petitioners are personally and directly affected or
prejudiced by the alleged non-publication of the presidential issuances in
question   said petitioners are without the requisite legal personality to institute
2
this mandamus proceeding, they are not being "aggrieved parties" within the
meaning of Section 3, Rule 65 of the Rules of Court, which we quote:
SEC. 3. Petition for Mandamus.—When any tribunal,
corporation, board or person unlawfully neglects the
performance of an act which the law specifically enjoins as a
duty resulting from an office, trust, or station, or unlawfully
excludes another from the use a rd enjoyment of a right or office
to which such other is entitled, and there is no other plain,
speedy and adequate remedy in the ordinary course of law, the
person aggrieved thereby may file a verified petition in the
proper court alleging the facts with certainty and praying that
judgment be rendered commanding the defendant, immediately
or at some other specified time, to do the act required to be
done to Protect the rights of the petitioner, and to pay the
damages sustained by the petitioner by reason of the wrongful
acts of the defendant.
Upon the other hand, petitioners maintain that since the subject of the petition
concerns a public right and its object is to compel the performance of a public
duty, they need not show any specific interest for their petition to be given due
course.
The issue posed is not one of first impression. As early as the 1910 case
of Severino vs. Governor General,   this Court held that while the general rule is
3
that "a writ of mandamus would be granted to a private individual only in those
cases where he has some private or particular interest to be subserved, or
some particular right to be protected, independent of that which he holds with
the public at large," and "it is for the public officers exclusively to apply for the
writ when public rights are to be subserved [Mithchell vs. Boardmen, 79 M.e.,
469]," nevertheless, "when the question is one of public right and the object of
the mandamus is to procure the enforcement of a public duty, the people are
regarded as the real party in interest and the relator at whose instigation the
proceedings are instituted need not show that he has any legal or special
interest in the result, it being sufficient to show that he is a citizen and as such
interested in the execution of the laws [High, Extraordinary Legal Remedies,
3rd ed., sec. 431].
Thus, in said case, this Court recognized the relator Lope Severino, a private
individual, as a proper party to the mandamus proceedings brought to compel
the Governor General to call a special election for the position of municipal
president in the town of Silay, Negros Occidental. Speaking for this Court, Mr.
Justice Grant T. Trent said:
We are therefore of the opinion that the weight of authority
supports the proposition that the relator is a proper party to
proceedings of this character when a public right is sought to be
enforced. If the general rule in America were otherwise, we
think that it would not be applicable to the case at bar for the
reason 'that it is always dangerous to apply a general rule to a
particular case without keeping in mind the reason for the rule,
because, if under the particular circumstances the reason for
the rule does not exist, the rule itself is not applicable and
reliance upon the rule may well lead to error'
No reason exists in the case at bar for applying the general rule
insisted upon by counsel for the respondent. The circumstances
which surround this case are different from those in the United
States, inasmuch as if the relator is not a proper party to these
proceedings no other person could be, as we have seen that it
is not the duty of the law officer of the Government to appear
and represent the people in cases of this character.
The reasons given by the Court in recognizing a private citizen's legal
personality in the aforementioned case apply squarely to the present petition.
Clearly, the right sought to be enforced by petitioners herein is a public right
recognized by no less than the fundamental law of the land. If petitioners were
not allowed to institute this proceeding, it would indeed be difficult to conceive
of any other person to initiate the same, considering that the Solicitor General,
the government officer generally empowered to represent the people, has
entered his appearance for respondents in this case.
Respondents further contend that publication in the Official Gazette is not a
sine qua non requirement for the effectivity of laws where the laws themselves
provide for their own effectivity dates. It is thus submitted that since the
presidential issuances in question contain special provisions as to the date they
are to take effect, publication in the Official Gazette is not indispensable for
their effectivity. The point stressed is anchored on Article 2 of the Civil Code:
Art. 2. Laws shall take effect after fifteen days following the
completion of their publication in the Official Gazette, unless it is
otherwise provided, ...
The interpretation given by respondent is in accord with this Court's
construction of said article. In a long line of decisions,  this Court has ruled that
4
publication in the Official Gazette is necessary in those cases where the
legislation itself does not provide for its effectivity date-for then the date of
publication is material for determining its date of effectivity, which is the
fifteenth day following its publication-but not when the law itself provides for the
date when it goes into effect.
Respondents' argument, however, is logically correct only insofar as it equates
the effectivity of laws with the fact of publication. Considered in the light of other
statutes applicable to the issue at hand, the conclusion is easily reached that
said Article 2 does not preclude the requirement of publication in the Official
Gazette, even if the law itself provides for the date of its effectivity. Thus,
Section 1 of Commonwealth Act 638 provides as follows:
Section 1. There shall be published in the Official Gazette [1] all
important legisiative acts and resolutions of a public nature of
the, Congress of the Philippines; [2] all executive and
administrative orders and proclamations, except such as have
no general applicability; [3] decisions or abstracts of decisions
of the Supreme Court and the Court of Appeals as may be
deemed by said courts of sufficient importance to be so
published; [4] such documents or classes of documents as may
be required so to be published by law; and [5] such documents
or classes of documents as the President of the Philippines
shall determine from time to time to have general applicability
and legal effect, or which he may authorize so to be
published. ...
The clear object of the above-quoted provision is to give the general public
adequate notice of the various laws which are to regulate their actions and
conduct as citizens. Without such notice and publication, there would be no
basis for the application of the maxim "ignorantia legis non excusat." It would
be the height of injustice to punish or otherwise burden a citizen for the
transgression of a law of which he had no notice whatsoever, not even a
constructive one.
Perhaps at no time since the establishment of the Philippine Republic has the
publication of laws taken so vital significance that at this time when the people
have bestowed upon the President a power heretofore enjoyed solely by the
legislature. While the people are kept abreast by the mass media of the
debates and deliberations in the Batasan Pambansa—and for the diligent ones,
ready access to the legislative records—no such publicity accompanies the
law-making process of the President. Thus, without publication, the people
have no means of knowing what presidential decrees have actually been
promulgated, much less a definite way of informing themselves of the specific
contents and texts of such decrees. As the Supreme Court of Spain ruled:
"Bajo la denominacion generica de leyes, se comprenden tambien los
reglamentos, Reales decretos, Instrucciones, Circulares y Reales ordines
dictadas de conformidad con las mismas por el Gobierno en uso de su
potestad.5
The very first clause of Section I of Commonwealth Act 638 reads: "There shall
be published in the Official Gazette ... ." The word "shall" used therein imposes
upon respondent officials an imperative duty. That duty must be enforced if the
Constitutional right of the people to be informed on matters of public concern is
to be given substance and reality. The law itself makes a list of what should be
published in the Official Gazette. Such listing, to our mind, leaves respondents
with no discretion whatsoever as to what must be included or excluded from
such publication.
The publication of all presidential issuances "of a public nature" or "of general
applicability" is mandated by law. Obviously, presidential decrees that provide
for fines, forfeitures or penalties for their violation or otherwise impose a burden
or. the people, such as tax and revenue measures, fall within this category.
Other presidential issuances which apply only to particular persons or class of
persons such as administrative and executive orders need not be published on
the assumption that they have been circularized to all concerned.  6
It is needless to add that the publication of presidential issuances "of a public
nature" or "of general applicability" is a requirement of due process. It is a rule
of law that before a person may be bound by law, he must first be officially and
specifically informed of its contents. As Justice Claudio Teehankee said
in Peralta vs. COMELEC  : 7
In a time of proliferating decrees, orders and letters of
instructions which all form part of the law of the land, the
requirement of due process and the Rule of Law demand that
the Official Gazette as the official government repository
promulgate and publish the texts of all such decrees, orders
and instructions so that the people may know where to obtain
their official and specific contents.
The Court therefore declares that presidential issuances of general application,
which have not been published, shall have no force and effect. Some members
of the Court, quite apprehensive about the possible unsettling effect this
decision might have on acts done in reliance of the validity of those presidential
decrees which were published only during the pendency of this petition, have
put the question as to whether the Court's declaration of invalidity apply to
P.D.s which had been enforced or implemented prior to their publication. The
answer is all too familiar. In similar situations in the past this Court had taken
the pragmatic and realistic course set forth in Chicot County Drainage District
vs. Baxter Bank   to wit:
8
The courts below have proceeded on the theory that the Act of
Congress, having been found to be unconstitutional, was not a
law; that it was inoperative, conferring no rights and imposing
no duties, and hence affording no basis for the challenged
decree. Norton v. Shelby County, 118 U.S. 425, 442; Chicago,
1. & L. Ry. Co. v. Hackett, 228 U.S. 559, 566. It is quite clear,
however, that such broad statements as to the effect of a
determination of unconstitutionality must be taken with
qualifications. The actual existence of a statute, prior to such a
determination, is an operative fact and may have consequences
which cannot justly be ignored. The past cannot always be
erased by a new judicial declaration. The effect of the
subsequent ruling as to invalidity may have to be considered in
various aspects-with respect to particular conduct, private and
official. Questions of rights claimed to have become vested, of
status, of prior determinations deemed to have finality and
acted upon accordingly, of public policy in the light of the nature
both of the statute and of its previous application, demand
examination. These questions are among the most difficult of
those which have engaged the attention of courts, state and
federal and it is manifest from numerous decisions that an all-
inclusive statement of a principle of absolute retroactive
invalidity cannot be justified.
Consistently with the above principle, this Court in Rutter vs.
Esteban   sustained the right of a party under the Moratorium Law, albeit said
9
right had accrued in his favor before said law was declared unconstitutional by
this Court.
Similarly, the implementation/enforcement of presidential decrees prior to their
publication in the Official Gazette is "an operative fact which may have
consequences which cannot be justly ignored. The past cannot always be
erased by a new judicial declaration ... that an all-inclusive statement of a
principle of absolute retroactive invalidity cannot be justified."
From the report submitted to the Court by the Clerk of Court, it appears that of
the presidential decrees sought by petitioners to be published in the Official
Gazette, only Presidential Decrees Nos. 1019 to 1030, inclusive, 1278, and
1937 to 1939, inclusive, have not been so published.   Neither the subject
10
matters nor the texts of these PDs can be ascertained since no copies thereof
are available. But whatever their subject matter may be, it is undisputed that
none of these unpublished PDs has ever been implemented or enforced by the
government. In Pesigan vs. Angeles,   the Court, through Justice Ramon
11
Aquino, ruled that "publication is necessary to apprise the public of the contents
of [penal] regulations and make the said penalties binding on the persons
affected thereby. " The cogency of this holding is apparently recognized by
respondent officials considering the manifestation in their comment that "the
government, as a matter of policy, refrains from prosecuting violations of
criminal laws until the same shall have been published in the Official Gazette or
in some other publication, even though some criminal laws provide that they
shall take effect immediately.
WHEREFORE, the Court hereby orders respondents to publish in the Official
Gazette all unpublished presidential issuances which are of general application,
and unless so published, they shall have no binding force and effect.
SO ORDERED.
Relova, J., concurs.
Aquino, J., took no part.
Concepcion, Jr., J., is on leave.
 
 
Separate Opinions
 
FERNANDO, C.J., concurring (with qualification):
There is on the whole acceptance on my part of the views expressed in the
ably written opinion of Justice Escolin. I am unable, however, to concur insofar
as it would unqualifiedly impose the requirement of publication in the Official
Gazette for unpublished "presidential issuances" to have binding force and
effect.
I shall explain why.
1. It is of course true that without the requisite publication, a due process
question would arise if made to apply adversely to a party who is not even
aware of the existence of any legislative or executive act having the force and
effect of law. My point is that such publication required need not be confined to
the Official Gazette. From the pragmatic standpoint, there is an advantage to
be gained. It conduces to certainty. That is too be admitted. It does not follow,
however, that failure to do so would in all cases and under all circumstances
result in a statute, presidential decree or any other executive act of the same
category being bereft of any binding force and effect. To so hold would, for me,
raise a constitutional question. Such a pronouncement would lend itself to the
interpretation that such a legislative or presidential act is bereft of the attribute
of effectivity unless published in the Official Gazette. There is no such
requirement in the Constitution as Justice Plana so aptly pointed out. It is true
that what is decided now applies only to past "presidential issuances".
Nonetheless, this clarification is, to my mind, needed to avoid any possible
misconception as to what is required for any statute or presidential act to be
impressed with binding force or effectivity.
2. It is quite understandable then why I concur in the separate opinion of
Justice Plana. Its first paragraph sets forth what to me is the constitutional
doctrine applicable to this case. Thus: "The Philippine Constitution does not
require the publication of laws as a prerequisite for their effectivity, unlike some
Constitutions elsewhere. It may be said though that the guarantee of due
process requires notice of laws to affected Parties before they can be bound
thereby; but such notice is not necessarily by publication in the Official Gazette.
The due process clause is not that precise.   I am likewise in agreement with its
1
closing paragraph: "In fine, I concur in the majority decision to the extent that it
requires notice before laws become effective, for no person should be bound
by a law without notice. This is elementary fairness. However, I beg to disagree
insofar as it holds that such notice shall be by publication in the Official
Gazette.  2
3. It suffices, as was stated by Judge Learned Hand, that law as the command
of the government "must be ascertainable in some form if it is to be enforced at
all.   It would indeed be to reduce it to the level of mere futility, as pointed out by
3
Justice Cardozo, "if it is unknown and unknowable.   Publication, to repeat, is
4
thus essential. What I am not prepared to subscribe to is the doctrine that it
must be in the Official Gazette. To be sure once published therein there is the
ascertainable mode of determining the exact date of its effectivity. Still for me
that does not dispose of the question of what is the jural effect of past
presidential decrees or executive acts not so published. For prior thereto, it
could be that parties aware of their existence could have conducted themselves
in accordance with their provisions. If no legal consequences could attach due
to lack of publication in the Official Gazette, then serious problems could arise.
Previous transactions based on such "Presidential Issuances" could be open to
question. Matters deemed settled could still be inquired into. I am not prepared
to hold that such an effect is contemplated by our decision. Where such
presidential decree or executive act is made the basis of a criminal prosecution,
then, of course, its ex post facto character becomes evident.   In civil cases
5
though, retroactivity as such is not conclusive on the due process aspect.
There must still be a showing of arbitrariness. Moreover, where the challenged
presidential decree or executive act was issued under the police power, the
non-impairment clause of the Constitution may not always be successfully
invoked. There must still be that process of balancing to determine whether or
not it could in such a case be tainted by infirmity.   In traditional terminology,
6
there could arise then a question of unconstitutional application. That is as far
as it goes.
4. Let me make therefore that my qualified concurrence goes no further than to
affirm that publication is essential to the effectivity of a legislative or executive
act of a general application. I am not in agreement with the view that such
publication must be in the Official Gazette. The Civil Code itself in its Article 2
expressly recognizes that the rule as to laws taking effect after fifteen days
following the completion of their publication in the Official Gazette is subject to
this exception, "unless it is otherwise provided." Moreover, the Civil Code is
itself only a legislative enactment, Republic Act No. 386. It does not and cannot
have the juridical force of a constitutional command. A later legislative or
executive act which has the force and effect of law can legally provide for a
different rule.
5. Nor can I agree with the rather sweeping conclusion in the opinion of Justice
Escolin that presidential decrees and executive acts not thus previously
published in the Official Gazette would be devoid of any legal character. That
would be, in my opinion, to go too far. It may be fraught, as earlier noted, with
undesirable consequences. I find myself therefore unable to yield assent to
such a pronouncement.
I am authorized to state that Justices Makasiar, Abad Santos, Cuevas, and
Alampay concur in this separate opinion.
Makasiar, Abad Santos, Cuevas and Alampay, JJ., concur.
 
TEEHANKEE, J., concurring:
I concur with the main opinion of Mr. Justice Escolin and the concurring opinion
of Mme. Justice Herrera. The Rule of Law connotes a body of norms and laws
published and ascertainable and of equal application to all similarly
circumstances and not subject to arbitrary change but only under certain set
procedures. The Court has consistently stressed that "it is an elementary rule of
fair play and justice that a reasonable opportunity to be informed must be
afforded to the people who are commanded to obey before they can be
punished for its violation,  citing the settled principle based on due process
1
enunciated in earlier cases that "before the public is bound by its contents,
especially its penal provisions, a law, regulation or circular must first be
published and the people officially and specially informed of said contents and
its penalties.
Without official publication in the Official Gazette as required by Article 2 of the
Civil Code and the Revised Administrative Code, there would be no basis nor
justification for the corollary rule of Article 3 of the Civil Code (based on
constructive notice that the provisions of the law are ascertainable from the
public and official repository where they are duly published) that "Ignorance of
the law excuses no one from compliance therewith.
Respondents' contention based on a misreading of Article 2 of the Civil Code
that "only laws which are silent as to their effectivity [date] need be published in
the Official Gazette for their effectivity" is manifestly untenable. The plain text
and meaning of the Civil Code is that "laws shall take effect after fifteen days
following the completion of their publication in the Official Gazette, unless it is
otherwise provided, " i.e. a different effectivity date is provided by the law itself.
This proviso perforce refers to a law that has been duly published pursuant to
the basic constitutional requirements of due process. The best example of this
is the Civil Code itself: the same Article 2 provides otherwise that it "shall take
effect [only] one year [not 15 days] after such publication.   To sustain 2
respondents' misreading that "most laws or decrees specify the date of their
effectivity and for this reason, publication in the Official Gazette is not
necessary for their effectivity   would be to nullify and render nugatory the Civil
3
Code's indispensable and essential requirement of prior publication in the
Official Gazette by the simple expedient of providing for immediate effectivity or
an earlier effectivity date in the law itself before the completion of 15 days
following its publication which is the period generally fixed by the Civil Code for
its proper dissemination.
 
MELENCIO-HERRERA, J., concurring:
I agree. There cannot be any question but that even if a decree provides for a
date of effectivity, it has to be published. What I would like to state in
connection with that proposition is that when a date of effectivity is mentioned
in the decree but the decree becomes effective only fifteen (15) days after its
publication in the Official Gazette, it will not mean that the decree can have
retroactive effect to the date of effectivity mentioned in the decree itself. There
should be no retroactivity if the retroactivity will run counter to constitutional
rights or shall destroy vested rights.
PLANA, J., concurring (with qualification):
The Philippine Constitution does not require the publication of laws as a
prerequisite for their effectivity, unlike some Constitutions elsewhere. * It may be
said though that the guarantee of due process requires notice of laws to affected parties before they can be
bound thereby; but such notice is not necessarily by publication in the Official Gazette. The due process clause
is not that precise. Neither is the publication of laws in the Official Gazette required by any statute as a
prerequisite for their effectivity, if said laws already provide for their effectivity date.
Article 2 of the Civil Code provides that "laws shall take effect after fifteen days
following the completion of their publication in the Official Gazette, unless it is
otherwise provided " Two things may be said of this provision: Firstly, it
obviously does not apply to a law with a built-in provision as to when it will take
effect. Secondly, it clearly recognizes that each law may provide not only a
different period for reckoning its effectivity date but also a different mode of
notice. Thus, a law may prescribe that it shall be published elsewhere than in
the Official Gazette.
Commonwealth Act No. 638, in my opinion, does not support the proposition
that for their effectivity, laws must be published in the Official Gazette. The said
law is simply "An Act to Provide for the Uniform Publication and Distribution of
the Official Gazette." Conformably therewith, it authorizes the publication of the
Official Gazette, determines its frequency, provides for its sale and distribution,
and defines the authority of the Director of Printing in relation thereto. It also
enumerates what shall be published in the Official Gazette, among them,
"important legislative acts and resolutions of a public nature of the Congress of
the Philippines" and "all executive and administrative orders and proclamations,
except such as have no general applicability." It is noteworthy that not all
legislative acts are required to be published in the Official Gazette but only
"important" ones "of a public nature." Moreover, the said law does not provide
that publication in the Official Gazette is essential for the effectivity of laws. This
is as it should be, for all statutes are equal and stand on the same footing. A
law, especially an earlier one of general application such as Commonwealth
Act No. 638, cannot nullify or restrict the operation of a subsequent statute that
has a provision of its own as to when and how it will take effect. Only a higher
law, which is the Constitution, can assume that role.
In fine, I concur in the majority decision to the extent that it requires notice
before laws become effective, for no person should be bound by a law without
notice. This is elementary fairness. However, I beg to disagree insofar as it
holds that such notice shall be by publication in the Official Gazette.
Cuevas and Alampay, JJ., concur.
 
GUTIERREZ, Jr., J., concurring:
I concur insofar as publication is necessary but reserve my vote as to the
necessity of such publication being in the Official Gazette.
 
DE LA FUENTE, J., concurring:
I concur insofar as the opinion declares the unpublished decrees and
issuances of a public nature or general applicability ineffective, until due
publication thereof.
 
 
Separate Opinions
FERNANDO, C.J., concurring (with qualification):
There is on the whole acceptance on my part of the views expressed in the
ably written opinion of Justice Escolin. I am unable, however, to concur insofar
as it would unqualifiedly impose the requirement of publication in the Official
Gazette for unpublished "presidential issuances" to have binding force and
effect.
I shall explain why.
1. It is of course true that without the requisite publication, a due process
question would arise if made to apply adversely to a party who is not even
aware of the existence of any legislative or executive act having the force and
effect of law. My point is that such publication required need not be confined to
the Official Gazette. From the pragmatic standpoint, there is an advantage to
be gained. It conduces to certainty. That is too be admitted. It does not follow,
however, that failure to do so would in all cases and under all circumstances
result in a statute, presidential decree or any other executive act of the same
category being bereft of any binding force and effect. To so hold would, for me,
raise a constitutional question. Such a pronouncement would lend itself to the
interpretation that such a legislative or presidential act is bereft of the attribute
of effectivity unless published in the Official Gazette. There is no such
requirement in the Constitution as Justice Plana so aptly pointed out. It is true
that what is decided now applies only to past "presidential issuances".
Nonetheless, this clarification is, to my mind, needed to avoid any possible
misconception as to what is required for any statute or presidential act to be
impressed with binding force or effectivity.
2. It is quite understandable then why I concur in the separate opinion of
Justice Plana. Its first paragraph sets forth what to me is the constitutional
doctrine applicable to this case. Thus: "The Philippine Constitution does not
require the publication of laws as a prerequisite for their effectivity, unlike some
Constitutions elsewhere. It may be said though that the guarantee of due
process requires notice of laws to affected Parties before they can be bound
thereby; but such notice is not necessarily by publication in the Official Gazette.
The due process clause is not that precise.   I am likewise in agreement with its
1
closing paragraph: "In fine, I concur in the majority decision to the extent that it
requires notice before laws become effective, for no person should be bound
by a law without notice. This is elementary fairness. However, I beg to disagree
insofar as it holds that such notice shall be by publication in the Official
Gazette.  2
3. It suffices, as was stated by Judge Learned Hand, that law as the command
of the government "must be ascertainable in some form if it is to be enforced at
all.   It would indeed be to reduce it to the level of mere futility, as pointed out by
3 published and ascertainable and of equal application to all similarly
Justice Cardozo, "if it is unknown and unknowable.   Publication, to repeat, is
4 circumstances and not subject to arbitrary change but only under certain set
thus essential. What I am not prepared to subscribe to is the doctrine that it
must be in the Official Gazette. To be sure once published therein there is the
ascertainable mode of determining the exact date of its effectivity. Still for me
that does not dispose of the question of what is the jural effect of past
presidential decrees or executive acts not so published. For prior thereto, it
could be that parties aware of their existence could have conducted themselves
in accordance with their provisions. If no legal consequences could attach due
to lack of publication in the Official Gazette, then serious problems could arise.
Previous transactions based on such "Presidential Issuances" could be open to
question. Matters deemed settled could still be inquired into. I am not prepared
to hold that such an effect is contemplated by our decision. Where such
presidential decree or executive act is made the basis of a criminal prosecution,
then, of course, its ex post facto character becomes evident.   In civil cases
5
though, retroactivity as such is not conclusive on the due process aspect.
There must still be a showing of arbitrariness. Moreover, where the challenged
presidential decree or executive act was issued under the police power, the
non-impairment clause of the Constitution may not always be successfully
invoked. There must still be that process of balancing to determine whether or
not it could in such a case be tainted by infirmity.   In traditional terminology,
6
there could arise then a question of unconstitutional application. That is as far
as it goes.
4. Let me make therefore that my qualified concurrence goes no further than to
affirm that publication is essential to the effectivity of a legislative or executive
act of a general application. I am not in agreement with the view that such
publication must be in the Official Gazette. The Civil Code itself in its Article 2
expressly recognizes that the rule as to laws taking effect after fifteen days
following the completion of their publication in the Official Gazette is subject to
this exception, "unless it is otherwise provided." Moreover, the Civil Code is
itself only a legislative enactment, Republic Act No. 386. It does not and cannot
have the juridical force of a constitutional command. A later legislative or
executive act which has the force and effect of law can legally provide for a
different rule.
5. Nor can I agree with the rather sweeping conclusion in the opinion of Justice
Escolin that presidential decrees and executive acts not thus previously
published in the Official Gazette would be devoid of any legal character. That
would be, in my opinion, to go too far. It may be fraught, as earlier noted, with
undesirable consequences. I find myself therefore unable to yield assent to
such a pronouncement.
I am authorized to state that Justices Makasiar, Abad Santos, Cuevas, and
Alampay concur in this separate opinion.
Makasiar, Abad Santos, Cuevas and Alampay, JJ., concur.
TEEHANKEE, J., concurring:
I concur with the main opinion of Mr. Justice Escolin and the concurring opinion
of Mme. Justice Herrera. The Rule of Law connotes a body of norms and laws
procedures. The Court has consistently stressed that "it is an elementary rule of
fair play and justice that a reasonable opportunity to be informed must be
afforded to the people who are commanded to obey before they can be
punished for its violation,  citing the settled principle based on due process
1
enunciated in earlier cases that "before the public is bound by its contents,
especially its penal provisions, a law, regulation or circular must first be
published and the people officially and specially informed of said contents and
its penalties.
Without official publication in the Official Gazette as required by Article 2 of the
Civil Code and the Revised Administrative Code, there would be no basis nor
justification for the corollary rule of Article 3 of the Civil Code (based on
constructive notice that the provisions of the law are ascertainable from the
public and official repository where they are duly published) that "Ignorance of
the law excuses no one from compliance therewith.
Respondents' contention based on a misreading of Article 2 of the Civil Code
that "only laws which are silent as to their effectivity [date] need be published in
the Official Gazette for their effectivity" is manifestly untenable. The plain text
and meaning of the Civil Code is that "laws shall take effect after fifteen days
following the completion of their publication in the Official Gazette, unless it is
otherwise provided, " i.e. a different effectivity date is provided by the law itself.
This proviso perforce refers to a law that has been duly published pursuant to
the basic constitutional requirements of due process. The best example of this
is the Civil Code itself: the same Article 2 provides otherwise that it "shall take
effect [only] one year [not 15 days] after such publication.   To sustain 2
respondents' misreading that "most laws or decrees specify the date of their
effectivity and for this reason, publication in the Official Gazette is not
necessary for their effectivity   would be to nullify and render nugatory the Civil
3
Code's indispensable and essential requirement of prior publication in the
Official Gazette by the simple expedient of providing for immediate effectivity or
an earlier effectivity date in the law itself before the completion of 15 days
following its publication which is the period generally fixed by the Civil Code for
its proper dissemination.
MELENCIO-HERRERA, J., concurring:
I agree. There cannot be any question but that even if a decree provides for a
date of effectivity, it has to be published. What I would like to state in
connection with that proposition is that when a date of effectivity is mentioned
in the decree but the decree becomes effective only fifteen (15) days after its
publication in the Official Gazette, it will not mean that the decree can have
retroactive effect to the date of effectivity mentioned in the decree itself. There
should be no retroactivity if the retroactivity will run counter to constitutional
rights or shall destroy vested rights.
PLANA, J., concurring (with qualification):
The Philippine Constitution does not require the publication of laws as a
prerequisite for their effectivity, unlike some Constitutions elsewhere. * It may be
said though that the guarantee of due process requires notice of laws to affected parties before they can be
bound thereby; but such notice is not necessarily by publication in the Official Gazette. The due process clause
is not that precise. Neither is the publication of laws in the Official Gazette required by any statute as a
prerequisite for their effectivity, if said laws already provide for their effectivity date.
Article 2 of the Civil Code provides that "laws shall take effect after fifteen days
following the completion of their publication in the Official Gazette, unless it is
otherwise provided " Two things may be said of this provision: Firstly, it
obviously does not apply to a law with a built-in provision as to when it will take
effect. Secondly, it clearly recognizes that each law may provide not only a
different period for reckoning its effectivity date but also a different mode of
notice. Thus, a law may prescribe that it shall be published elsewhere than in
the Official Gazette.
Commonwealth Act No. 638, in my opinion, does not support the proposition
that for their effectivity, laws must be published in the Official Gazette. The said
law is simply "An Act to Provide for the Uniform Publication and Distribution of
the Official Gazette." Conformably therewith, it authorizes the publication of the
Official Gazette, determines its frequency, provides for its sale and distribution,
and defines the authority of the Director of Printing in relation thereto. It also
enumerates what shall be published in the Official Gazette, among them,
"important legislative acts and resolutions of a public nature of the Congress of
the Philippines" and "all executive and administrative orders and proclamations,
except such as have no general applicability." It is noteworthy that not all
legislative acts are required to be published in the Official Gazette but only
"important" ones "of a public nature." Moreover, the said law does not provide
that publication in the Official Gazette is essential for the effectivity of laws. This
is as it should be, for all statutes are equal and stand on the same footing. A
law, especially an earlier one of general application such as Commonwealth
Act No. 638, cannot nullify or restrict the operation of a subsequent statute that
has a provision of its own as to when and how it will take effect. Only a higher
law, which is the Constitution, can assume that role.
In fine, I concur in the majority decision to the extent that it requires notice
before laws become effective, for no person should be bound by a law without
notice. This is elementary fairness. However, I beg to disagree insofar as it
holds that such notice shall be by publication in the Official Gazette.
Cuevas and Alampay, JJ., concur.
GUTIERREZ, Jr., J., concurring:
I concur insofar as publication is necessary but reserve my vote as to the
necessity of such publication being in the Official Gazette.
DE LA FUENTE, J., concurring:
I concur insofar as the opinion declares the unpublished decrees and
issuances of a public nature or general applicability ineffective, until due
publication thereof.

JUAN AUGUSTO B. PRIMICIAS, plaintiff-appellee,
vs.
THE MUNICIPALITY OF URDANETA, PANGASINAN, ET AL., defendants-
appellants.
Ambrosio Padilla Law Offices for appellee.
Primicias, Castillo & Macaraeg for appellants.
DE CASTRO, J.:
The main issue in this appeal is the validity of Ordinance No. 3, Series of 1964,
enacted on March 13,1964 by the Municipal Council of Urdaneta, Pangasinan,
which was declared null and void by the Court of First Instance of Lingayen,
Pangasinan, in its decision dated June 29, 1966, the dispositive portion of
which reads as follows:
WHEREFORE, this Court renders decision declaring Ordinance
No, 3, Series of 1964, to be null and void; making the writ of
preliminary injunction heretofore issued against the defendant,
Felix D. Soriano definite and permanent; and further restraining
the defendants, Amadeo R. Perez, Jr., Lorenzo G. Suyat and
Estanislao Andrada, from enforcing the said ordinance all
throughout Urdaneta; and ordering the said defendants to return
to the plaintiff his drivers (sic) license CIN 017644, a copy of
which is Exhibit D-1, and to pay the costs of suit. 
1 SECTION 2 - That any person or persons caught driving any
From the aforecited decision, defendants appealed to this Court. The
antecedent facts of this case are as follows:  2
On February 8, 1965, Juan Augusta B. Primacias plaintiff appellee, was driving
his car within the jurisdiction of Urdaneta when a member of Urdaneta's
Municipal Police asked him to stop. He was told, upon stopping, that he had
violated Municipal Ordinance No. 3, Series of 1964, "and more particularly, for
overtaking a truck." The policeman then asked for plaintiff's license which he
surrendered, and a temporary operator's permit was issued to him. This
incident took place about 200 meters away from a school building, at Barrio
Nancamaliran, Urdaneta.
Thereafter, a criminal complaint was filed in the Municipal Court of Urdaneta
against Primicias for violation of Ordinance No. 3, Series of 1964. Due to the
institution of the criminal case, plaintiff Primicias initiated an action for the questioned
annulment of said ordinance with prayer for the issuance of preliminary
injunction for the purpose of restraining defendants Municipality of Urdaneta,
Mayor Perez, Police Chief Suyat, Judge Soriano and Patrolman Andrada from
enforcing the ordinance. The writ was issued and Judge Soriano was enjoined
from further proceeding in the criminal case.
After trial, the Court of First Instance rendered the questioned decision holding
that the ordinance was null and void and had been repealed by Republic Act
No. 4136, otherwise known as the Land Transportation and Traffic Code. Now,
defendants, appellants herein, allege that the lower court erred in:  3
1. declaring that Municipal Ordinance No. 3 (Series of 1964) of
Urdaneta is null and void;
2. requiring the municipal council of Urdaneta in the enactment
of said ordinance to give maximum allowable speed and to
make classification of highways;
3. holding that said ordinance is in conflict with section 35 par.
b(4) of Republic Act 4136;
4. requiring that said ordinance be approved by the Land
Transportation Commissioner;
5. holding that said ordinance is not clear and definite in its
terms;
6. issuing ex-parte a writ of injunction to restrain the
proceedings in criminal case no. 3140.
The ordinance in question provides:  4
SECTION 1 - That the following speed limits for vehicular traffic
along the National Highway and the Provincial Roads within the
territorial limits of Urdaneta shall be as follows:
a. Thru crowded streets approaching
intersections at 'blind corners, passing school
zones or thickly populated areas, duly marked
with sign posts, the maximum speed limit
allowable shall be 20 kph.
motor vehicle violating the provisions of this ordinance shall be
fined P10.00 for the first offense; P20.00 for the second offense;
and P30.00 for the third and succeeding offenses, the Municipal
Judge shall recommend the cancellation of the license of the
offender to the Motor Vehicle's Office (MVO); or failure to pay
the fine imposed, he shall suffer a subsidiary imprisonment in
accordance with law.
Appellants contend that the Ordinance is valid, being "patterned after and
based on Section 53, 
5
 par. 4 of Act No. 3992, as amended (Revised Motor
Vehicle Law)." In so arguing, appellants fail to note that Act No. 3992 has been
superseded by Republic Act No. 4136, the Land Transportation and 'Traffic
Code, which became effective on June 20, 1964, about three months after the
ordinance was approved by Urdaneta's Municipal Council. The
explicit repeal of the aforesaid Act is embodied in Section 63, Republic Act No.
4136, to wit:
Act Numbered thirty-nine hundred ninety-two (3992) as
amended, and all laws, executive orders, ordinance,
resolutions, regulations or paints thereof in conflict with the
provisions of this Act are repealed.
By this express repeal, and the general rule that a later law prevails over an
earlier law,   appellants are in error in contending that "a later enactment of the
6
law relating to the same subject matter as that of an earlier statute is not
sufficient to cause an implied repeal of the original law." Pursuant to Section A look at the aforecited section and Section 1, par. (a) of the Ordinance shows
63, Republic Act No. 4136, the ordinance at bar is thus placed within the ambit that the latter is more or less a restatement only of number (4), par. (b), Section
of Republic Act No. 4136, and not Act No. 3992. The validity of Ordinance No. 35. As observed by the trial court, the Ordinance "refers to only one of the four
3, Series of 1964, must therefore be determined vis-a-vis Republic Act No. classifications mentioned in paragraph (b), Section 35."   limiting the rates of
10

4136, the "mother statute" so to speak, which was in force at the time the
criminal case was brought against Primicias for the violation of the said
ordinance.
An essential requisite for a valid ordinance is, among others, that is "must not
contravene . . . the statute,"   for it is a "fundamental principle that municipal
7
ordinances are inferior in status and subordinate to the laws of the
speed for
vehicular traffic along the national highway and The provincial
roads within the territorial limits of Urdaneta to 20 kilometers per
hour without regard to whether the road is an open country
roads (six), or through streets or boulevards, or city or municipal
streets with light traffic. 
11

state."   Following this general rule, whenever there is a conflict between an

8
As also found correctly by the lower court, the Municipal Council of Urdaneta
ordinance and a statute, the ordinance "must give way.  9
did not make any classification of its thoroughfares, contrary to the explicit
Since the Ordinance is aimed at regulating traffic, Chapter IV Traffic Rules), requirement laid down by Section 38, Republic Act No. 4136, which provides:
Article I (Speed Limits and Keeping to the Right), consisting of sections 35, to Classification of highways. - Public highways shall be properly
38 of Republic Act No. 4136, particularly Sections 35, 36, 38 contain the classified for traffic purposes by the provincial board or city
provisions material to its validity. Section 35 (b), Republic Act No. 4136, which council having jurisdiction over them, and said provincial board,
took the place of Section 53, par. (4), Act No. 3992, provides restrictions as to municipal board or city council shall provide appropriate signs
speed thus: therefor, subject to the approval of the Commissioner. It shall be
MAXIMUM ALLOWABLE SPEEDS the duty of every provincial, city and municipal secretary to
  Passenger cars and Motor trucks certify to the Commissioner the names, locations, and limits of
all "through streets" designated as such by the provincial board,
  motorcycle and buses municipal board or council.
Under this section, a local legislative body intending to control traffic in public
1. On open country roads, with    
highways   is supposed to classify, first, and then mark them with proper signs,
12

"blind corners" not closely bordered     all to be approved by the Land Transportation Commissioner. To hold that the
provisions of Section 38 are mandatory is sanctioned by a ruling   that
13

by habitation.
2. On through streets or
boulevards, clear of traffic, with "no
blind corners" when so designated.
3. On city and municipal
streets, with light traffic, when not
designated "through streets."
4. Through crowded streets ap
proaching intersection at "blind cor
ners," passing school zones, passing
other vehicles which are stationary, or
for similar circumstances.
per hour
80 km. 50 km. statutes which confer upon a public body or officer . . . power to
per hour per hour perform acts which concern the public interests or rights of
individuals, are generally, regarded as mandatory although the
    language is permissive only since the are construed as
40 km. 30 km. imposing duties rather than conferring privileges.
The classifications which must be based on Section 35 are necessary in view
per hour per hourof Section 36 which states that "no provincial, city or municipal authority shall
enact or enforce any ordinance or resolution specifying maximum allowable
   
speeds other than those provided in this Act." In this case, however, there is no
30 km. 30 km. showing that the marking of the streets and areas falling under Section 1, par.
(a), Ordinance No. 3, Series of 1964, was done with the approval of the Land
per hour per hourTransportation Commissioner. Thus, on this very ground alone, the Ordinance
    becomes invalid. Since it lacks the requirement imposed by Section 38, the
provincial, city, or municipal board or council is enjoined under Section 62 of
    the Land Transportation and Traffic Code from "enacting or enforcing any
    ordinance or resolution in conflict with the provisions of this Act."
Regarding the contention that the lower court erred in holding that said
20 km. 20 km. "Ordinance is not clear and definite in its terms." We agree with the Court a
quo that when the Municipal Council of Urdaneta used the phrase "vehicular
per hour  
traffic" (Section 1, Ordinance) it "did not distinguish between passenger cars
and motor vehicles and motor trucks and buses."   This conclusion is bolstered
14
by the fact that nowhere in the Ordinance is "vehicular traffic" defined. The ordinance in question was in effect a speed trap for unwary motorists for
Considering that this is a regulatory ordinance, its clearness, definiteness and which Urdaneta had become notorious.
certainty are all the more important so that "an average man should be able
with due care, after reading it,, to understand and ascertain whether he will
incur a penalty for particular acts or courses of conduct."   In comparison,
15

Section 35(b), Republic Act No. 4136 on which Section 1 of the Ordinance
must be based, stated that the rates of speed enumerated therein refer to
motor vehicle,   specifying the speed for each kind of vehicle. At the same time,
16

to avoid vagueness, Art. 11, Section 3 defines what a motor vehicle is and
passenger automobiles are.
On the issue of whether a writ of injunction can restrain the proceedings in
Criminal Case No. 3140, the general rule is that "ordinarily, criminal prosecution
may not be blocked by court prohibition or injunction."   Exceptions however
17

are allowed in the following instances:

1. for the orderly administration of justice;
2. to prevent the use of the strong arm of the law in an
oppressive and vindictive manner;
3. to avoid multiplicity of actions;
4. to afford adequate protection to constitutional rights;
5. in proper cases, because the statute relied upon is
unconstitutional or was held invalid. 
18

The local statute or ordinance at bar being invalid, the exception just cited
obtains in this case. Hence, the lower court did not err in issuing the writ of
injunction against defendants. Moreover, considering that "our law on municipal
corporations is in principle patterned after that of the United States, "   it would
19

not be amiss for Us to adopt in this instance the ruling that to enjoin the
enforcement of a void ordinance, "injunction has frequently been sustained in
order to prevent a multiplicity of prosecutions under it." 
20

In view of the foregoing, the appealed decision is hereby affirmed.

SO ORDERED.
Teehankee, Acting C.J., Barredo, Makasiar, Concepcion Jr., Santos,
Fernandez, Guerrero, and Melencio-Herrera, JJ., concur.
Aquino, J., took no part.
Antonio, J., is on leave.
 
 
Separate Opinions
 
ABAD SANTOS, J., concurring:
The ordinance in question was in effect a speed trap for unwary motorists for
which Urdaneta had become notorious.
 
 
# Separate Opinions
ABAD SANTOS, J., concurring:

HON. RAMON D. BAGATSING, as Mayor of the City of Manila; ROMAN G.
GARGANTIEL, as Secretary to the Mayor; THE MARKET
ADMINISTRATOR; and THE MUNICIPAL BOARD OF MANILA, petitioners,
vs.
HON. PEDRO A. RAMIREZ, in his capacity as Presiding Judge of the
Court of First Instance of Manila, Branch XXX and the FEDERATION OF
MANILA MARKET VENDORS, INC., respondents.
Santiago F. Alidio and Restituto R. Villanueva for petitioners.
Antonio H. Abad, Jr. for private respondent.
Federico A. Blay for petitioner for intervention.
MARTIN, J.:
The chief question to be decided in this case is what law shall govern the
publication of a tax ordinance enacted by the Municipal Board of Manila, the
Revised City Charter (R.A. 409, as amended), which requires publication of the
ordinance before its enactment and after its approval, or the Local Tax Code
(P.D. No. 231), which only demands publication after approval.
On June 12, 1974, the Municipal Board of Manila enacted Ordinance No. 7522,
"AN ORDINANCE REGULATING THE OPERATION OF PUBLIC MARKETS
AND PRESCRIBING FEES FOR THE RENTALS OF STALLS AND
PROVIDING PENALTIES FOR VIOLATION THEREOF AND FOR OTHER
PURPOSES." The petitioner City Mayor, Ramon D. Bagatsing, approved the
ordinance on June 15, 1974.
On February 17, 1975, respondent Federation of Manila Market Vendors, Inc.
commenced Civil Case 96787 before the Court of First Instance of Manila
presided over by respondent Judge, seeking the declaration of nullity of
Ordinance No. 7522 for the reason that (a) the publication requirement under
the Revised Charter of the City of Manila has not been complied with; (b) the
Market Committee was not given any participation in the enactment of the
ordinance, as envisioned by Republic Act 6039; (c) Section 3 (e) of the Anti-
Graft and Corrupt Practices Act has been violated; and (d) the ordinance would
violate Presidential Decree No. 7 of September 30, 1972 prescribing the
collection of fees and charges on livestock and animal products.
Resolving the accompanying prayer for the issuance of a writ of preliminary
injunction, respondent Judge issued an order on March 11, 1975, denying the
plea for failure of the respondent Federation of Manila Market Vendors, Inc. to
exhaust the administrative remedies outlined in the Local Tax Code.
After due hearing on the merits, respondent Judge rendered its decision on
August 29, 1975, declaring the nullity of Ordinance No. 7522 of the City of
Manila on the primary ground of non-compliance with the requirement of
publication under the Revised City Charter. Respondent Judge ruled:
There is, therefore, no question that the ordinance in question
was not published at all in two daily newspapers of general
circulation in the City of Manila before its enactment. Neither
was it published in the same manner after approval, although it
was posted in the legislative hall and in all city public markets
and city public libraries. There being no compliance with the
mandatory requirement of publication before and after approval,
the ordinance in question is invalid and, therefore, null and void.
Petitioners moved for reconsideration of the adverse decision, stressing that (a)
only a post-publication is required by the Local Tax Code; and (b) private
respondent failed to exhaust all administrative remedies before instituting an
action in court.
On September 26, 1975, respondent Judge denied the motion.
Forthwith, petitioners brought the matter to Us through the present petition for
review on certiorari.
We find the petition impressed with merits.
1. The nexus of the present controversy is the apparent conflict between the
Revised Charter of the City of Manila and the Local Tax Code on the manner of
publishing a tax ordinance enacted by the Municipal Board of Manila. For, while
Section 17 of the Revised Charter provides:
Each proposed ordinance shall be published in two daily
newspapers of general circulation in the city, and shall not be
discussed or enacted by the Board until after the third day
following such publication. * * * Each approved ordinance * * *
shall be published in two daily newspapers of general
circulation in the city, within ten days after its approval; and
shall take effect and be in force on and after the twentieth day
following its publication, if no date is fixed in the ordinance.
Section 43 of the Local Tax Code directs:
Within ten days after their approval, certified true copies of all
provincial, city, municipal and barrio ordinances levying or
imposing taxes, fees or other charges shall be published for
three consecutive days in a newspaper or publication widely
circulated within the jurisdiction of the local government, or
posted in the local legislative hall or premises and in two other
conspicuous places within the territorial jurisdiction of the local
government. In either case, copies of all provincial, city,
municipal and barrio ordinances shall be furnished the
treasurers of the respective component and mother units of a
local government for dissemination.
In other words, while the Revised Charter of the City of Manila requires
publication before the enactment of the ordinance and after the approval
thereof in two daily newspapers of general circulation in the city, the Local Tax
Code only prescribes for publication after the approval of "ordinances levying
or imposing taxes, fees or other charges" either in a newspaper or publication
widely circulated within the jurisdiction of the local government or by posting the
ordinance in the local legislative hall or premises and in two other conspicuous
places within the territorial jurisdiction of the local government. Petitioners'
compliance with the Local Tax Code rather than with the Revised Charter of the
City spawned this litigation.
There is no question that the Revised Charter of the City of Manila is a special
act since it relates only to the City of Manila, whereas the Local Tax Code is a
general law because it applies universally to all local governments. Blackstone
defines general law as a universal rule affecting the entire community and
special law as one relating to particular persons or things of a class.   And the
1
rule commonly said is that a prior special law is not ordinarily repealed by a
subsequent general law. The fact that one is special and the other general
creates a presumption that the special is to be considered as remaining an
exception of the general, one as a general law of the land, the other as the law
of a particular case.   However, the rule readily yields to a situation where the
2
special statute refers to a subject in general, which the general statute treats
in particular. The exactly is the circumstance obtaining in the case at bar.
Section 17 of the Revised Charter of the City of Manila speaks of "ordinance" in
general, i.e., irrespective of the nature and scope thereof, whereas, Section 43
of the Local Tax Code relates to "ordinances levying or imposing taxes, fees or
other charges" in particular. In regard, therefore, to ordinances in general, the
Revised Charter of the City of Manila is doubtless dominant, but, that dominant
force loses its continuity when it approaches the realm of "ordinances levying or
imposing taxes, fees or other charges" in particular. There, the Local Tax Code
controls. Here, as always, a general provision must give way to a particular
provision.   Special provision governs.   This is especially true where the law
3 4
containing the particular provision was enacted later than the one containing
the general provision. The City Charter of Manila was promulgated on June 18,
1949 as against the Local Tax Code which was decreed on June 1, 1973. The
law-making power cannot be said to have intended the establishment of
conflicting and hostile systems upon the same subject, or to leave in force
provisions of a prior law by which the new will of the legislating power may be
thwarted and overthrown. Such a result would render legislation a useless and
Idle ceremony, and subject the law to the reproach of uncertainty and
unintelligibility. 
5
The case of City of Manila v. Teotico   is opposite. In that case, Teotico sued
6
the City of Manila for damages arising from the injuries he suffered when he fell
inside an uncovered and unlighted catchbasin or manhole on P. Burgos
Avenue. The City of Manila denied liability on the basis of the City Charter (R.A.
409) exempting the City of Manila from any liability for damages or injury to
persons or property arising from the failure of the city officers to enforce the
provisions of the charter or any other law or ordinance, or from negligence of
the City Mayor, Municipal Board, or other officers while enforcing or attempting
to enforce the provisions of the charter or of any other law or ordinance. Upon
the other hand, Article 2189 of the Civil Code makes cities liable for damages
for the death of, or injury suffered by any persons by reason of the defective
condition of roads, streets, bridges, public buildings, and other public works
under their control or supervision. On review, the Court held the Civil Code
controlling. It is true that, insofar as its territorial application is concerned, the
Revised City Charter is a special law and the subject matter of the two laws,
the Revised City Charter establishes a general rule of liability arising from
negligence in general, regardless of the object thereof, whereas the Civil Code
constitutes a particular prescription for liability due to defective streets in
particular. In the same manner, the Revised Charter of the City prescribes a
rule for the publication of "ordinance" in general, while the Local Tax Code
establishes a rule for the publication of "ordinance levying or imposing taxes
fees or other charges in particular.
In fact, there is no rule which prohibits the repeal even by implication of a
special or specific act by a general or broad one.   A charter provision may be
7
impliedly modified or superseded by a later statute, and where a statute is
controlling, it must be read into the charter notwithstanding any particular
charter provision.   A subsequent general law similarly applicable to all cities
8
prevails over any conflicting charter provision, for the reason that a charter
must not be inconsistent with the general laws and public policy of the state.   A9
chartered city is not an independent sovereignty. The state remains supreme in
all matters not purely local. Otherwise stated, a charter must yield to the
constitution and general laws of the state, it is to have read into it that general
law which governs the municipal corporation and which the corporation cannot
set aside but to which it must yield. When a city adopts a charter, it in effect
adopts as part of its charter general law of such character.  10
2. The principle of exhaustion of administrative remedies is strongly asserted
by petitioners as having been violated by private respondent in bringing a direct
suit in court. This is because Section 47 of the Local Tax Code provides that
any question or issue raised against the legality of any tax ordinance, or portion
thereof, shall be referred for opinion to the city fiscal in the case of tax
ordinance of a city. The opinion of the city fiscal is appealable to the Secretary
of Justice, whose decision shall be final and executory unless contested before
a competent court within thirty (30) days. But, the petition below plainly shows
that the controversy between the parties is deeply rooted in a pure question of
law: whether it is the Revised Charter of the City of Manila or the Local Tax
Code that should govern the publication of the tax ordinance. In other words,
the dispute is sharply focused on the applicability of the Revised City Charter or
the Local Tax Code on the point at issue, and not on the legality of the
imposition of the tax. Exhaustion of administrative remedies before resort to
judicial bodies is not an absolute rule. It admits of exceptions. Where the
question litigated upon is purely a legal one, the rule does not apply.   The
11
principle may also be disregarded when it does not provide a plain, speedy and
adequate remedy. It may and should be relaxed when its application may
cause great and irreparable damage.  12
3. It is maintained by private respondent that the subject ordinance is not a "tax
ordinance," because the imposition of rentals, permit fees, tolls and other fees
is not strictly a taxing power but a revenue-raising function, so that the
procedure for publication under the Local Tax Code finds no application. The
pretense bears its own marks of fallacy. Precisely, the raising of revenues is
the principal object of taxation. Under Section 5, Article XI of the New
Constitution, "Each local government unit shall have the power to create its
own sources of revenue and to levy taxes, subject to such provisions as may
be provided by law."   And one of those sources of revenue is what the Local
13
Tax Code points to in particular: "Local governments may collect fees or rentals
for the occupancy or use of public markets and premises * * *."   They can
14
provide for and regulate market stands, stalls and privileges, and, also, the
sale, lease or occupancy thereof. They can license, or permit the use of, lease,
That is the object it serves. The entrusting of the collection of the fees does not
destroy the public purpose of the ordinance. So long as the purpose is public, it
does not matter whether the agency through which the money is dispensed is
public or private. The right to tax depends upon the ultimate use, purpose and
object for which the fund is raised. It is not dependent on the nature or
character of the person or corporation whose intermediate agency is to be used
in applying it. The people may be taxed for a public purpose, although it be
under the direction of an individual or private corporation. 
18

sell or otherwise dispose of stands, stalls or marketing privileges.  15

It is a feeble attempt to argue that the ordinance violates Presidential Decree
No. 7, dated September 30, 1972, insofar as it affects livestock and animal
products, because the said decree prescribes the collection of other fees and
Nor can the ordinance be stricken down as violative of Section 3(e) of the Anti-
Graft and Corrupt Practices Act because the increased rates of market stall
fees as levied by the ordinance will necessarily inure to the unwarranted benefit
and advantage of the corporation.   We are concerned only with the issue
19

charges thereon "with the exception of ante-mortem and post-mortem whether the ordinance in question is intra vires. Once determined in the
inspection fees, as well as the delivery, stockyard and slaughter fees as may affirmative, the measure may not be invalidated because of consequences that
be authorized by the Secretary of Agriculture and Natural may arise from its enforcement.  20

Resources."   Clearly, even the exception clause of the decree itself permits
16
ACCORDINGLY, the decision of the court below is hereby reversed and set
the collection of the proper fees for livestock. And the Local Tax Code (P.D. aside. Ordinance No. 7522 of the City of Manila, dated June 15, 1975, is
231, July 1, 1973) authorizes in its Section 31: "Local governments may collect hereby held to have been validly enacted. No. costs.
fees for the slaughter of animals and the use of corrals * * * " SO ORDERED.
4. The non-participation of the Market Committee in the enactment of Castro, C.J., Barredo, Makasiar, Antonio, Muñoz Palma, Aquino and
Ordinance No. 7522 supposedly in accordance with Republic Act No. 6039, an Concepcion, Jr., JJ., concur.
amendment to the City Charter of Manila, providing that "the market committee Teehankee, J., reserves his vote.
shall formulate, recommend and adopt, subject to the ratification of the  
municipal board, and approval of the mayor, policies and rules or regulation  
repealing or maneding existing provisions of the market code" does not infect Separate Opinions
the ordinance with any germ of invalidity.   The function of the committee is
17
 
purely recommendatory as the underscored phrase suggests, its FERNANDO, J., concurring:
recommendation is without binding effect on the Municipal Board and the City But qualifies his assent as to an ordinance intra vires not being open to
Mayor. Its prior acquiescence of an intended or proposed city ordinance is not question "because of consequences that may arise from its enforcement."
a condition sine qua non before the Municipal Board could enact such  
ordinance. The native power of the Municipal Board to legislate remains  
undisturbed even in the slightest degree. It can move in its own initiative and
the Market Committee cannot demur. At most, the Market Committee may
serve as a legislative aide of the Municipal Board in the enactment of city
ordinances affecting the city markets or, in plain words, in the gathering of the
necessary data, studies and the collection of consensus for the proposal of
ordinances regarding city markets. Much less could it be said that Republic Act
6039 intended to delegate to the Market Committee the adoption of regulatory
measures for the operation and administration of the city markets. Potestas
delegata non delegare potest.
5. Private respondent bewails that the market stall fees imposed in the disputed
ordinance are diverted to the exclusive private use of the Asiatic Integrated
Corporation since the collection of said fees had been let by the City of Manila
to the said corporation in a "Management and Operating Contract." The
assumption is of course saddled on erroneous premise. The fees collected do
not go direct to the private coffers of the corporation. Ordinance No. 7522 was
not made for the corporation but for the purpose of raising revenues for the city.
 to discuss the results of the investigation conducted by Revenue Officer Cueto,
supervised by Revenue Officer Madelyn T. Sacluti.
BIR officers and PAL representatives attended the scheduled informal
conference, during which the former relayed to the latter that the BIR was
denying the claim for refund of PAL and, instead, was assessing PAL for
COMMISSIONER OF INTERNAL REVENUE, Petitioner, deficiency MCIT for FY 2000-2001. The PAL representatives argued that PAL
vs. was not liable for MCIT under its franchise. The BIR officers then informed the
PHILIPPINE AIRLINES, INC., Respondent. PAL representatives that the matter would be referred to the BIR Legal Service
DECISION for opinion.
CHICO-NAZARIO, J.: The LTAID 1 issued, on 3 September 2003, PAN No. INC FY-3-31-01-000094,
Before this Court is a Petition for Review on Certiorari, under Rule 45 of the which was received by PAL on 23 October 2003. LTAID 1 assessed PAL for
Revised Rules of Court, seeking the reversal and setting aside of the ₱262,474,732.54, representing deficiency MCIT for FY 2000-2001, plus interest
Decision1 dated 9 August 2007 and Resolution2 dated 11 October 2007 of the and compromise penalty, computed as follows:
Court of Tax Appeals (CTA) en banc in CTA E.B. No. 246. The CTA en banc Sales/Revenues from Operation ₱ 38,798,721,685.00
affirmed the Decision3 dated 31 July 2006 of the CTA Second Division in C.T.A. Less: Cost of Services 30,316,679,013.00
Case No. 7010, ordering the cancellation and withdrawal of Preliminary
Assessment Notice (PAN) No. INC FY-3-31-01-000094 dated 3 September Gross Income from Operation 8,482,042,672.00
2003 and Formal Letter of Demand dated 12 January 2004, issued by the Add: Non-operating income 465,111,368.00
Bureau of Internal Revenue (BIR) against respondent Philippine Airlines, Inc.
(PAL), for the payment of Minimum Corporate Income Tax (MCIT) in the Total Gross Income for MCIT purposes 9,947,154,040.008
amount of ₱272,421,886.58. Rate of Tax 2%
There is no dispute as to the antecedent facts of this case.
Tax Due 178,943,080.80
PAL is a domestic corporation organized under the corporate laws of the
Republic of the Philippines; declared the national flag carrier of the country; and Add: 20% interest (8-16-00 to 10-31-03) 83,506,651.74
the grantee under Presidential Decree No. 15904 of a franchise to establish, Compromise Penalty 25,000.00
operate, and maintain transport services for the carriage of passengers, mail,
and property by air, in and between any and all points and places throughout
the Philippines, and between the Philippines and other countries.5 Total Amount Due ₱ 262,474,732.549
For its fiscal year ending 31 March 2001 (FY 2000-2001), PAL allegedly PAL protested PAN No. INC FY-3-31-01-000094 through a letter dated 4
incurred zero taxable income,6 which left it with unapplied creditable withholding November 2003 to the BIR LTS.
tax7 in the amount of ₱2,334,377.95. PAL did not pay any MCIT for the period. On 12 January 2004, the LTAID 1 sent PAL a Formal Letter of Demand for
In a letter dated 12 July 2002, addressed to petitioner Commissioner of Internal deficiency MCIT for FY 2000-2001 in the amount of ₱271,421,88658, based on
Revenue (CIR), PAL requested for the refund of its unapplied creditable the following calculation:
withholding tax for FY 2000-2001. PAL attached to its letter the following: (1) Sales/Revenues from   ₱
Schedule of Creditable Tax Withheld at Source for FY 2000-2001; (2) Operation 38,798,721,685.00
Certificates of Creditable Taxes Withheld; and (3) Audited Financial
Statements. 1avvphi1
Less: Cost of Services    
Acting on the aforementioned letter of PAL, the Large Taxpayers Audit and
Direct Costs - ₱  
Investigation Division 1 (LTAID 1) of the BIR Large Taxpayers Service (LTS),
30,749,761,017.00
issued on 16 August 2002, Tax Verification Notice No. 00201448, authorizing
Revenue Officer Jacinto Cueto, Jr. (Cueto) to verify the supporting documents Less: Non-deductible    
and pertinent records relative to the claim of PAL for refund of its unapplied
interest expense 433,082,004.00 30,316,679,013.00
creditable withholding tax for FY 2000-20001. In a letter dated 19 August 2003,
LTAID 1 Chief Armit S. Linsangan invited PAL to an informal conference at the Gross Income from ₱ 8,482,042,672.00
BIR National Office in Diliman, Quezon City, on 27 August 2003, at 10:00 a.m., Operation
 Add: Non-operating 465,111,368.00
Income
Total Gross Income for MCIT purposes ₱ 9,947,154,040.00
MCIT tax due   ₱ 178,943,080.80
Interest – 20% per annum – 7/16/01 to 02/15/04 92,453,805.78
Compromise Penalty   25,000.00
Total MCIT due and demandable ₱ 271,421,886.5810
PAL received the foregoing Formal Letter of Demand on 12 February 2004,
prompting it to file with the BIR LTS a formal written protest dated 13 February
2004.
The BIR LTS rendered on 7 May 2004 its Final Decision on Disputed
Assessment, which was received by PAL on 26 May 2004. Invoking Revenue
Memorandum Circular (RMC) No. 66-2003, the BIR LTS denied with finality the
protest of PAL and reiterated the request that PAL immediately pay its
deficiency MCIT for FY 2000-2001, inclusive of penalties incident to
delinquency.
1avvphi1
PAL filed a Petition for Review with the CTA, which was docketed as C.T.A.
Case No. 7010 and raffled to the CTA Second Division. The CTA Second
Division promulgated its Decision on 31 July 2006, ruling in favor of PAL. The
dispositive portion of the judgment of the CTA Second Division reads:
WHEREFORE, premises considered, the instant Petition for Review is hereby
GRANTED. Accordingly, Assessment Notice No. INC FY-3-31-01-000094 and
Formal Letter of Demand for the payment of deficiency Minimum Corporate
Income Tax in the amount of ₱272,421,886.58 are hereby CANCELLED and
WITHDRAWN.11
In a Resolution dated 2 January 2007, the CTA Second Division denied the
Motion for Reconsideration of the CIR.
It was then the turn of the CIR to file a Petition for Review with the CTA en
banc, docketed as C.T.A. E.B. No. 246. The CTA en banc found that "the cited
legal provisions and jurisprudence are teeming with life with respect to the
grant of tax exemption too vivid to pass unnoticed," and that "the Court in
Division correctly ruled in favor of the respondent [PAL] granting its petition for
the cancellation of Assessment Notice No. INC FY-3-31-01-000094 and Formal
Letter of Demand for the deficiency MCIT in the amount of
₱272,421,886.58."12 Consequently, the CTA en banc denied the Petition of the
CIR for lack of merit. The CTA en banc likewise denied the Motion for
Reconsideration of the CIR in a Resolution dated 11 October 2007.
Hence, the CIR comes before this Court via the instant Petition for Review on
Certiorari, based on the grounds stated hereunder:
THE COURT OF TAX APPEALS ERRED ON A QUESTION OF LAW IN ITS
ASSAILED DECISION BECAUSE:
(1) [PAL] CLEARLY OPTED TO BE COVERED BY THE INCOME TAX
PROVISION OF THE NATIONAL INTERNAL REVENUE CODE OF
1997 (NIRC OF 1997). (sic) AS AMENDED; HENCE, IT IS COVERED
BY THE MCIT PROVISION OF THE SAME CODE.
(2) THE MCIT DOES NOT BELONG TO THE CATEGORY OF
"OTHER TAXES" WHICH WOULD ENABLE RESPONDENT TO AVAIL
ITSELF OF THE "IN LIEU" (sic) OF ALL OTHER TAXES" CLAUSE
UNDER SECTION 13 OF P.D. NO. 1590 ("CHARTER").
(3) THE MCIT PROVISION OF THE NIRC OF 1997 IS NOT AN
AMENDMENT OF [PAL’S] CHARTER.
(4) PAL IS NOT ONLY GIVEN THE PRIVILEGE TO CHOOSE
BETWEEN WHAT WILL GIVE IT THE BENEFIT OF A LOWER TAX,
BUT ALSO THE RESPONSIBILITY OF PAYING ITS SHARE OF THE
TAX BURDEN, AS IS EVIDENT IN SECTION 22 OF RA NO. 9337.
(5) A CLAIM FOR EXEMPTION FROM TAXATION IS NEVER
PRESUMED; [PAL] IS LIABLE FOR THE DEFICIENCY MCIT.13
There is only one vital issue that the Court must resolve in the Petition at
bar, i.e., whether PAL is liable for deficiency MCIT for FY 2000-2001.
The Court answers in the negative.
Presidential Decree No. 1590, the franchise of PAL, contains provisions
specifically governing the taxation of said corporation, to wit:
Section 13. In consideration of the franchise and rights hereby granted, the
grantee shall pay to the Philippine Government during the life of this
franchise whichever of subsections (a) and (b) hereunder will result in a lower
tax:
(a) The basic corporate income tax based on the grantee's annual net
taxable income computed in accordance with the provisions of the
National Internal Revenue Code; or
(b) A franchise tax of two per cent (2%) of the gross revenues derived
by the grantee from all sources, without distinction as to transport or
nontransport operations; provided, that with respect to international air-
transport service, only the gross passenger, mail, and freight revenues
from its outgoing flights shall be subject to this tax.
The tax paid by the grantee under either of the above alternatives shall be in
lieu of all other taxes, duties, royalties, registration, license, and other fees and
charges of any kind, nature, or description, imposed, levied, established,
assessed, or collected by any municipal, city, provincial, or national authority or
government agency, now or in the future, including but not limited to the
following:
1. All taxes, duties, charges, royalties, or fees due on local purchases
by the grantee of aviation gas, fuel, and oil, whether refined or in crude
form, and whether such taxes, duties, charges, royalties, or fees are
directly due from or imposable upon the purchaser or the seller,
producer, manufacturer, or importer of said petroleum products but are
billed or passed on to the grantee either as part of the price or cost
thereof or by mutual agreement or other arrangement; provided, that all
such purchases by, sales or deliveries of aviation gas, fuel, and oil to
the grantee shall be for exclusive use in its transport and nontransport
operations and other activities incidental thereto;
 2. All taxes, including compensating taxes, duties, charges, royalties, or
fees due on all importations by the grantee of aircraft, engines,
equipment, machinery, spare parts, accessories, commissary and
catering supplies, aviation gas, fuel, and oil, whether refined or in crude
form and other articles, supplies, or materials; provided, that such
articles or supplies or materials are imported for the use of the grantee
in its transport and nontransport operations and other activities
incidental thereto and are not locally available in reasonable quantity,
quality, or price;
3. All taxes on lease rentals, interest, fees, and other charges payable
to lessors, whether foreign or domestic, of aircraft, engines, equipment,
machinery, spare parts, and other property rented, leased, or chartered
by the grantee where the payment of such taxes is assumed by the
grantee;
4. All taxes on interest, fees, and other charges on foreign loans
obtained and other obligations incurred by the grantee where the
payment of such taxes is assumed by the grantee;
5. All taxes, fees, and other charges on the registration, licensing,
acquisition, and transfer of aircraft, equipment, motor vehicles, and all
other personal and real property of the grantee; and
6. The corporate development tax under Presidential Decree No. 1158-
A.
The grantee, shall, however, pay the tax on its real property in conformity with
existing law.
For purposes of computing the basic corporate income tax as provided herein,
the grantee is authorized:
(a) To depreciate its assets to the extent of not more than twice as
fast the normal rate of depreciation; and
(b) To carry over as a deduction from taxable income any net
loss incurred in any year up to five years following the year of such
loss.
Section 14. The grantee shall pay either the franchise tax or the basic
corporate income tax on quarterly basis to the Commissioner of Internal
Revenue. Within sixty (60) days after the end of each of the first three quarters
of the taxable calendar or fiscal year, the quarterly franchise or income-tax
return shall be filed and payment of either the franchise or income tax shall be
made by the grantee.
A final or an adjustment return covering the operation of the grantee for the
preceding calendar or fiscal year shall be filed on or before the fifteenth day of
the fourth month following the close of the calendar or fiscal year. The amount
of the final franchise or income tax to be paid by the grantee shall be the
balance of the total franchise or income tax shown in the final or adjustment
return after deducting therefrom the total quarterly franchise or income taxes
already paid during the preceding first three quarters of the same taxable year.
Any excess of the total quarterly payments over the actual annual franchise of
income tax due as shown in the final or adjustment franchise or income-tax
return shall either be refunded to the grantee or credited against the grantee's
quarterly franchise or income-tax liability for the succeeding taxable year or
years at the option of the grantee.
The term "gross revenues" is herein defined as the total gross income earned
by the grantee from; (a) transport, nontransport, and other services; (b)
earnings realized from investments in money-market placements, bank
deposits, investments in shares of stock and other securities, and other
investments; (c) total gains net of total losses realized from the disposition of
assets and foreign-exchange transactions; and (d) gross income from other
sources. (Emphases ours.)
According to the afore-quoted provisions, the taxation of PAL, during the
lifetime of its franchise, shall be governed by two fundamental rules,
particularly: (1) PAL shall pay the Government either basic corporate income
tax or franchise tax, whichever is lower; and (2) the tax paid by PAL, under
either of these alternatives, shall be in lieu of all other taxes, duties, royalties,
registration, license, and other fees and charges, except only real property tax.
The basic corporate income tax of PAL shall be based on its annual net taxable
income, computed in accordance with the National Internal Revenue Code
(NIRC). Presidential Decree No. 1590 also explicitly authorizes PAL, in the
computation of its basic corporate income tax, to (1) depreciate its assets twice
as fast the normal rate of depreciation;14 and (2) carry over as a deduction from
taxable income any net loss incurred in any year up to five years following the
year of such loss.15
Franchise tax, on the other hand, shall be two per cent (2%) of the gross
revenues derived by PAL from all sources, whether transport or nontransport
operations. However, with respect to international air-transport service, the
franchise tax shall only be imposed on the gross passenger, mail, and freight
revenues of PAL from its outgoing flights.
In its income tax return for FY 2000-2001, filed with the BIR, PAL reported no
net taxable income for the period, resulting in zero basic corporate income tax,
which would necessarily be lower than any franchise tax due from PAL for the
same period.
The CIR, though, assessed PAL for MCIT for FY 2000-2001. It is the position of
the CIR that the MCIT is income tax for which PAL is liable. The CIR reasons
that Section 13(a) of Presidential Decree No. 1590 provides that the corporate
income tax of PAL shall be computed in accordance with the NIRC. And, since
the NIRC of 1997 imposes MCIT, and PAL has not applied for relief from the
said tax, then PAL is subject to the same.
The Court is not persuaded. The arguments of the CIR are contrary to the plain
meaning and obvious intent of Presidential Decree No. 1590, the franchise of
PAL.
Income tax on domestic corporations is covered by Section 27 of the NIRC of
1997,16 pertinent provisions of which are reproduced below for easy reference:
SEC. 27. Rates of Income Tax on Domestic Corporations. –
(A) In General – Except as otherwise provided in this Code, an income tax of
thirty-five percent (35%) is hereby imposed upon the taxable income derived
during each taxable year from all sources within and without the Philippines by
every corporation, as defined in Section 22(B) of this Code and taxable under
this Title as a corporation, organized in, or existing under the laws of the
Philippines: Provided, That effective January 1, 1998, the rate of income tax
shall be thirty-four percent (34%); effective January 1, 1999, the rate shall be
thirty-three percent (33%); and effective January 1, 2000 and thereafter, the
rate shall be thirty-two percent (32%).
xxxx
(E) Minimum Corporate Income Tax on Domestic Corporations. –
(1) Imposition of Tax. – A minimum corporate income tax of two percent (2%) of
the gross income as of the end of the taxable year, as defined herein, is hereby
imposed on a corporation taxable under this Title, beginning on the fourth
taxable year immediately following the year in which such corporation
commenced its business operations, when the minimum income tax is greater
than the tax computed under Subsection (A) of this Section for the taxable
year.
Hence, a domestic corporation must pay whichever is higher of: (1) the income
tax under Section 27(A) of the NIRC of 1997, computed by applying the tax rate
therein to the taxable income of the corporation; or (2) the MCIT under Section
27(E), also of the NIRC of 1997, equivalent to 2% of the gross income of the
corporation. Although this may be the general rule in determining the income
tax due from a domestic corporation under the NIRC of 1997, it can only be
applied to PAL to the extent allowed by the provisions in the franchise of PAL
specifically governing its taxation.
After a conscientious study of Section 13 of Presidential Decree No. 1590, in
relation to Sections 27(A) and 27(E) of the NIRC of 1997, the Court, like the
CTA en banc and Second Division, concludes that PAL cannot be subjected to
MCIT for FY 2000-2001.
First, Section 13(a) of Presidential Decree No. 1590 refers to "basic corporate
income tax." In Commissioner of Internal Revenue v. Philippine Airlines,
Inc.,17 the Court already settled that the "basic corporate income tax," under
Section 13(a) of Presidential Decree No. 1590, relates to the general rate of
35% (reduced to 32% by the year 2000) as stipulated in Section 27(A) of the
NIRC of 1997.
Section 13(a) of Presidential Decree No. 1590 requires that the basic corporate
income tax be computed in accordance with the NIRC. This means that PAL
shall compute its basic corporate income tax using the rate and basis
prescribed by the NIRC of 1997 for the said tax. There is nothing in Section
13(a) of Presidential Decree No. 1590 to support the contention of the CIR that
PAL is subject to the entire Title II of the NIRC of 1997, entitled "Tax on
Income."
Second, Section 13(a) of Presidential Decree No. 1590 further provides that the
basic corporate income tax of PAL shall be based on its annual net taxable
income. This is consistent with Section 27(A) of the NIRC of 1997, which
provides that the rate of basic corporate income tax, which is 32% beginning 1
January 2000, shall be imposed on the taxable income of the domestic
corporation.
Taxable income is defined under Section 31 of the NIRC of 1997 as the
pertinent items of gross income specified in the said Code, less the deductions
and/or personal and additional exemptions, if any, authorized for such types of
income by the same Code or other special laws. The gross income, referred to
in Section 31, is described in Section 32 of the NIRC of 1997 as income from
whatever source, including compensation for services; the conduct of trade or
business or the exercise of profession; dealings in property; interests; rents;
royalties; dividends; annuities; prizes and winnings; pensions; and a partner’s
distributive share in the net income of a general professional partnership.
Pursuant to the NIRC of 1997, the taxable income of a domestic corporation
may be arrived at by subtracting from gross income deductions authorized, not
just by the NIRC of 1997,18 but also by special laws. Presidential Decree No.
1590 may be considered as one of such special laws authorizing PAL, in
computing its annual net taxable income, on which its basic corporate income
tax shall be based, to deduct from its gross income the following: (1)
depreciation of assets at twice the normal rate; and (2) net loss carry-over up to
five years following the year of such loss.
In comparison, the 2% MCIT under Section 27(E) of the NIRC of 1997 shall be
based on the gross income of the domestic corporation. The Court notes that
gross income, as the basis for MCIT, is given a special definition under Section
27(E)(4) of the NIRC of 1997, different from the general one under Section 34
of the same Code.
According to the last paragraph of Section 27(E)(4) of the NIRC of 1997, gross
income of a domestic corporation engaged in the sale of service means gross
receipts, less sales returns, allowances, discounts and cost of services. "Cost
of services" refers to all direct costs and expenses necessarily incurred to
provide the services required by the customers and clients including (a)
salaries and employee benefits of personnel, consultants, and specialists
directly rendering the service; and (b) cost of facilities directly utilized in
providing the service, such as depreciation or rental of equipment used and
cost of supplies.19 Noticeably, inclusions in and exclusions/deductions from
gross income for MCIT purposes are limited to those directly arising from the
conduct of the taxpayer’s business. It is, thus, more limited than the gross
income used in the computation of basic corporate income tax.
In light of the foregoing, there is an apparent distinction under the NIRC of 1997
between taxable income, which is the basis for basic corporate income tax
under Section 27(A); and gross income, which is the basis for the MCIT under
Section 27(E). The two terms have their respective technical meanings, and
cannot be used interchangeably. The same reasons prevent this Court from
declaring that the basic corporate income tax, for which PAL is liable under
Section 13(a) of Presidential Decree No. 1590, also covers MCIT under Section
27(E) of the NIRC of 1997, since the basis for the first is the annual net taxable
income, while the basis for the second is gross income.
Third, even if the basic corporate income tax and the MCIT are both income
taxes under Section 27 of the NIRC of 1997, and one is paid in place of the
other, the two are distinct and separate taxes.
The Court again cites Commissioner of Internal Revenue v. Philippine Airlines,
Inc.,20 wherein it held that income tax on the passive income21 of a domestic
corporation, under Section 27(D) of the NIRC of 1997, is different from the
basic corporate income tax on the taxable income of a domestic corporation,
imposed by Section 27(A), also of the NIRC of 1997. Section 13 of Presidential
Decree No. 1590 gives PAL the option to pay basic corporate income tax or
franchise tax, whichever is lower; and the tax so paid shall be in lieu of all other
taxes, except real property tax. The income tax on the passive income of PAL
falls within the category of "all other taxes" from which PAL is exempted, and
which, if already collected, should be refunded to PAL.
The Court herein treats MCIT in much the same way. Although both are income
taxes, the MCIT is different from the basic corporate income tax, not just in the
rates, but also in the bases for their computation. Not being covered by Section
13(a) of Presidential Decree No. 1590, which makes PAL liable only for basic
corporate income tax, then MCIT is included in "all other taxes" from which PAL
is exempted.
That, under general circumstances, the MCIT is paid in place of the basic
corporate income tax, when the former is higher than the latter, does not mean
that these two income taxes are one and the same. The said taxes are merely
paid in the alternative, giving the Government the opportunity to collect the
higher amount between the two. The situation is not much different from
Section 13 of Presidential Decree No. 1590, which reversely allows PAL to pay,
whichever is lower of the basic corporate income tax or the franchise tax. It
does not make the basic corporate income tax indistinguishable from the
franchise tax.
Given the fundamental differences between the basic corporate income tax and
the MCIT, presented in the preceding discussion, it is not baseless for this
Court to rule that, pursuant to the franchise of PAL, said corporation is subject
to the first tax, yet exempted from the second.
Fourth, the evident intent of Section 13 of Presidential Decree No. 1520 is to
extend to PAL tax concessions not ordinarily available to other domestic
corporations. Section 13 of Presidential Decree No. 1520 permits PAL to pay
whichever is lower of the basic corporate income tax or the franchise tax; and
the tax so paid shall be in lieu of all other taxes, except only real property tax.
Hence, under its franchise, PAL is to pay the least amount of tax possible.
Section 13 of Presidential Decree No. 1520 is not unusual. A public utility is
granted special tax treatment (including tax exceptions/exemptions) under its
franchise, as an inducement for the acceptance of the franchise and the
rendition of public service by the said public utility.22 In this case, in addition to
being a public utility providing air-transport service, PAL is also the official flag
carrier of the country.
The imposition of MCIT on PAL, as the CIR insists, would result in a situation
that contravenes the objective of Section 13 of Presidential Decree No. 1590.
In effect, PAL would not just have two, but three tax alternatives, namely, the
basic corporate income tax, MCIT, or franchise tax. More troublesome is the
fact that, as between the basic corporate income tax and the MCIT, PAL shall
be made to pay whichever is higher, irrefragably, in violation of the avowed
intention of Section 13 of Presidential Decree No. 1590 to make PAL pay for
the lower amount of tax.
Fifth, the CIR posits that PAL may not invoke in the instant case the "in lieu of
all other taxes" clause in Section 13 of Presidential Decree No. 1520, if it did
not pay anything at all as basic corporate income tax or franchise tax. As a
result, PAL should be made liable for "other taxes" such as MCIT. This line of
reasoning has been dubbed as the Substitution Theory, and this is not the first
time the CIR raised the same. The Court already rejected the Substitution
Theory in Commissioner of Internal Revenue v. Philippine Airlines, Inc.,23 to wit:
"Substitution Theory"
of the CIR Untenable
A careful reading of Section 13 rebuts the argument of the CIR that the "in lieu
of all other taxes" proviso is a mere incentive that applies only when PAL
actually pays something. It is clear that PD 1590 intended to give respondent
the option to avail itself of Subsection (a) or (b) as consideration for its
franchise. Either option excludes the payment of other taxes and dues imposed
or collected by the national or the local government. PAL has the option to
choose the alternative that results in lower taxes. It is not the fact of tax
payment that exempts it, but the exercise of its option.
Under Subsection (a), the basis for the tax rate is respondent’s annual net
taxable income, which (as earlier discussed) is computed by subtracting
allowable deductions and exemptions from gross income. By basing the tax
rate on the annual net taxable income, PD 1590 necessarily recognized the
situation in which taxable income may result in a negative amount and thus
translate into a zero tax liability.
Notably, PAL was owned and operated by the government at the time the
franchise was last amended. It can reasonably be contemplated that PD 1590
sought to assist the finances of the government corporation in the form of lower
taxes. When respondent operates at a loss (as in the instant case), no taxes
are due; in this instances, it has a lower tax liability than that provided by
Subsection (b).
The fallacy of the CIR’s argument is evident from the fact that the payment of a
measly sum of one peso would suffice to exempt PAL from other taxes,
whereas a zero liability arising from its losses would not. There is no substantial
distinction between a zero tax and a one-peso tax liability. (Emphasis ours.)
Based on the same ratiocination, the Court finds the Substitution Theory
unacceptable in the present Petition.
The CIR alludes as well to Republic Act No. 9337, for reasons similar to those
behind the Substitution Theory. Section 22 of Republic Act No. 9337, more
popularly known as the Expanded Value Added Tax (E-VAT) Law, abolished
the franchise tax imposed by the charters of particularly identified public
utilities, including Presidential Decree No. 1590 of PAL. PAL may no longer
exercise its options or alternatives under Section 13 of Presidential Decree No.
1590, and is now liable for both corporate income tax and the 12% VAT on its
sale of services. The CIR alleges that Republic Act No. 9337 reveals the
intention of the Legislature to make PAL share the tax burden of other domestic
corporations.
The CIR seems to lose sight of the fact that the Petition at bar involves the
liability of PAL for MCIT for the fiscal year ending 31 March 2001. Republic Act
No. 9337, which took effect on 1 July 2005, cannot be applied
retroactively24 and any amendment introduced by said statute affecting the
taxation of PAL is immaterial in the present case.
And sixth, Presidential Decree No. 1590 explicitly allows PAL, in computing its
basic corporate income tax, to carry over as deduction any net loss incurred in
any year, up to five years following the year of such loss. Therefore,
Presidential Decree No. 1590 does not only consider the possibility that, at the
end of a taxable period, PAL shall end up with zero annual net taxable income
(when its deductions exactly equal its gross income), as what happened in the
case at bar, but also the likelihood that PAL shall incur net loss (when its
deductions exceed its gross income). If PAL is subjected to MCIT, the provision
in Presidential Decree No. 1590 on net loss carry-over will be rendered
nugatory. Net loss carry-over is material only in computing the annual net
taxable income to be used as basis for the basic corporate income tax of PAL;
but PAL will never be able to avail itself of the basic corporate income tax
option when it is in a net loss position, because it will always then be compelled
to pay the necessarily higher MCIT.
Consequently, the insistence of the CIR to subject PAL to MCIT cannot be
done without contravening Presidential Decree No. 1520.
Between Presidential Decree No. 1520, on one hand, which is a special law
specifically governing the franchise of PAL, issued on 11 June 1978; and the
NIRC of 1997, on the other, which is a general law on national internal revenue
taxes, that took effect on 1 January 1998, the former prevails. The rule is that
on a specific matter, the special law shall prevail over the general law, which
shall be resorted to only to supply deficiencies in the former. In addition, where
there are two statutes, the earlier special and the later general – the terms of
the general broad enough to include the matter provided for in the special – the
fact that one is special and the other is general creates a presumption that the
special is to be considered as remaining an exception to the general, one as a
general law of the land, the other as the law of a particular case. It is a canon of
statutory construction that a later statute, general in its terms and not expressly
repealing a prior special statute, will ordinarily not affect the special provisions
of such earlier statute.25
Neither can it be said that the NIRC of 1997 repealed or amended Presidential
Decree No. 1590.
While Section 16 of Presidential Decree No. 1590 provides that the franchise is
granted to PAL with the understanding that it shall be subject to amendment,
alteration, or repeal by competent authority when the public interest so
requires, Section 24 of the same Decree also states that the franchise or any
portion thereof may only be modified, amended, or repealed expressly by a
special law or decree that shall specifically modify, amend, or repeal said
franchise or any portion thereof. No such special law or decree exists herein.
The CIR cannot rely on Section 7(B) of Republic Act No. 8424, which amended
the NIRC in 1997 and reads as follows:
Section 7. Repealing Clauses. –
xxxx
(B) The provisions of the National Internal Revenue Code, as amended, and all
other laws, including charters of government-owned or controlled corporations,
decrees, orders, or regulations or parts thereof, that are inconsistent with this
Act are hereby repealed or amended accordingly.
The CIR reasons that PAL was a government-owned and controlled
corporation when Presidential Decree No. 1590, its franchise or charter, was
issued in 1978. Since PAL was still operating under the very same charter
when Republic Act No. 8424 took effect in 1998, then the latter can repeal or
amend the former by virtue of Section 7(B).
The Court disagrees.
A brief recount of the history of PAL is in order. PAL was established as a
private corporation under the general law of the Republic of the Philippines in
February 1941. In November 1977, the government, through the Government
Service Insurance System (GSIS), acquired the majority shares in PAL. PAL
was privatized in January 1992 when the local consortium PR Holdings
acquired a 67% stake therein.26
It is true that when Presidential Decree No. 1590 was issued on 11 June 1978,
PAL was then a government-owned and controlled corporation; but when
Republic Act No. 8424, amending the NIRC, took effect on 1 January 1998,
PAL was already a private corporation for six years. The repealing clause
under Section 7(B) of Republic Act No. 8424 simply refers to charters of
government-owned and controlled corporations, which would simply and plainly
mean corporations under the ownership and control of the government at the
time of effectivity of said statute. It is already a stretch for the Court to read into
said provision charters, issued to what were then government-owned and
controlled corporations that are now private, but still operating under the same
charters.
That the Legislature chose not to amend or repeal Presidential Decree No.
1590, even after PAL was privatized, reveals the intent of the Legislature to let
PAL continue enjoying, as a private corporation, the very same rights and
privileges under the terms and conditions stated in said charter. From the
moment PAL was privatized, it had to be treated as a private corporation, and
its charter became that of a private corporation. It would be completely illogical
to say that PAL is a private corporation still operating under a charter of a
government-owned and controlled corporation.
The alternative argument of the CIR – that the imposition of the MCIT is
pursuant to the amendment of the NIRC, and not of Presidential Decree No.
1590 – is just as specious. As has already been settled by this Court, the basic
corporate income tax under Section 13(a) of Presidential Decree No. 1590
relates to the general tax rate under Section 27(A) of the NIRC of 1997, which
is 32% by the year 2000, imposed on taxable income. Thus, only provisions of
the NIRC of 1997 necessary for the computation of the basic corporate income
tax apply to PAL. And even though Republic Act No. 8424 amended the NIRC
by introducing the MCIT, in what is now Section 27(E) of the said Code, this
amendment is actually irrelevant and should not affect the taxation of PAL,
since the MCIT is clearly distinct from the basic corporate income tax referred
to in Section 13(a) of Presidential Decree No. 1590, and from which PAL is
consequently exempt under the "in lieu of all other taxes" clause of its charter.
The CIR calls the attention of the Court to RMC No. 66-2003, on "Clarifying the
Taxability of Philippine Airlines (PAL) for Income Tax Purposes As Well As
Other Franchise Grantees Similarly Situated." According to RMC No. 66-2003:
Section 27(E) of the Code, as implemented by Revenue Regulations No. 9-98,
provides that MCIT of two percent (2%) of the gross income as of the end of
the taxable year (whether calendar or fiscal year, depending on the accounting
period employed) is imposed upon any domestic corporation beginning the 4th
taxable year immediately following the taxable year in which such corporation
commenced its business operations. The MCIT shall be imposed whenever
such corporation has zero or negative taxable income or whenever the amount
of MCIT is greater than the normal income tax due from such corporation.
With the advent of such provision beginning January 1, 1998, it is certain that
domestic corporations subject to normal income tax as well as those choose to
be subject thereto, such as PAL, are bound to pay income tax regardless of
whether they are operating at a profit or loss.
Thus, in case of operating loss, PAL may either opt to subject itself to minimum
corporate income tax or to the 2% franchise tax, whichever is lower. On the
other hand, if PAL is operating at a profit, the income tax liability shall be the
lower amount between:
(1) normal income tax or MCIT whichever is higher; and
(2) 2% franchise tax.
The CIR attempts to sway this Court to adopt RMC No. 66-2003 since the
"[c]onstruction by an executive branch of government of a particular law
although not binding upon the courts must be given weight as the construction
comes from the branch of the government called upon to implement the law."27
But the Court is unconvinced.
It is significant to note that RMC No. 66-2003 was issued only on 14 October
2003, more than two years after FY 2000-2001 of PAL ended on 31 March
2001. This violates the well-entrenched principle that statutes, including
administrative rules and regulations, operate prospectively only, unless the
legislative intent to the contrary is manifest by express terms or by necessary
implication.28
Moreover, despite the claims of the CIR that RMC No. 66-2003 is just a
clarificatory and internal issuance, the Court observes that RMC No. 66-2003
does more than just clarify a previous regulation and goes beyond mere
internal administration. It effectively increases the tax burden of PAL and other
taxpayers who are similarly situated, making them liable for a tax for which they
were not liable before. Therefore, RMC No. 66-2003 cannot be given effect
without previous notice or publication to those who will be affected thereby. In
Commissioner of Internal Revenue v. Court of Appeals,29 the Court ratiocinated
that:
It should be understandable that when an administrative rule is merely
interpretative in nature, its applicability needs nothing further than its bare
issuance for it gives no real consequence more than what the law itself has
already prescribed. When, upon the other hand, the administrative rule goes
beyond merely providing for the means that can facilitate or render least
cumbersome the implementation of the law but substantially adds to or
increases the burden of those governed, it behooves the agency to accord at
least to those directly affected a chance to be heard, and thereafter to be duly
informed, before that new issuance is given the force and effect of law.
A reading of RMC 37-93, particularly considering the circumstances under
which it has been issued, convinces us that the circular cannot be viewed
simply as a corrective measure (revoking in the process the previous holdings
of past Commissioners) or merely as construing Section 142(c)(1) of the NIRC,
as amended, but has, in fact and most importantly, been made in order to place
"Hope Luxury," "Premium More" and "Champion" within the classification of
locally manufactured cigarettes bearing foreign brands and to thereby have
them covered by RA 7654. Specifically, the new law would have its amendatory
provisions applied to locally manufactured cigarettes which at the time of its
effectivity were not so classified as bearing foreign brands. Prior to the
issuance of the questioned circular, "Hope Luxury," "Premium More," and
"Champion" cigarettes were in the category of locally manufactured cigarettes
not bearing foreign brand subject to 45% ad valorem tax. Hence, without RMC
37-93, the enactment of RA 7654, would have had no new tax rate
consequence on private respondent's products. Evidently, in order to place
"Hope Luxury," "Premium More," and "Champion" cigarettes within the scope of
the amendatory law and subject them to an increased tax rate, the now
disputed RMC 37-93 had to be issued. In so doing, the BIR not simply
interpreted the law; verily, it legislated under its quasi-legislative authority. The
due observance of the requirements of notice, of hearing, and of publication
should not have been then ignored.
Indeed, the BIR itself, in its RMC 10-86, has observed and provided:
"RMC NO. 10-86
Effectivity of Internal Revenue Rules and Regulations "It has been observed
that one of the problem areas bearing on compliance with Internal Revenue
Tax rules and regulations is lack or insufficiency of due notice to the tax paying
public. Unless there is due notice, due compliance therewith may not be
reasonably expected. And most importantly, their strict enforcement could
possibly suffer from legal infirmity in the light of the constitutional provision on
'due process of law' and the essence of the Civil Code provision concerning
effectivity of laws, whereby due notice is a basic requirement (Sec. 1, Art. IV,
Constitution; Art. 2, New Civil Code).
"In order that there shall be a just enforcement of rules and regulations, in
conformity with the basic element of due process, the following procedures are
hereby prescribed for the drafting, issuance and implementation of the said
Revenue Tax Issuances:
"(1). This Circular shall apply only to (a) Revenue Regulations; (b) Revenue
Audit Memorandum Orders; and (c) Revenue Memorandum Circulars and
Revenue Memorandum Orders bearing on internal revenue tax rules and
regulations.
"(2). Except when the law otherwise expressly provides, the aforesaid internal
revenue tax issuances shall not begin to be operative until after due notice
thereof may be fairly presumed.
"Due notice of the said issuances may be fairly presumed only after the
following procedures have been taken:
"xxx xxx xxx "(5). Strict compliance with the foregoing procedures is
enjoined.13
Nothing on record could tell us that it was either impossible or impracticable for
the BIR to observe and comply with the above requirements before giving
effect to its questioned circular. (Emphases ours.)
The Court, however, stops short of ruling on the validity of RMC No. 66-2003,
for it is not among the issues raised in the instant Petition. It only wishes to
stress the requirement of prior notice to PAL before RMC No. 66-2003 could
have become effective. Only after RMC No. 66-2003 was issued on 14 October
2003 could PAL have been given notice of said circular, and only following
such notice to PAL would RMC No. 66-2003 have taken effect. Given this
sequence, it is not possible to say that RMC No. 66-2003 was already in effect
and should have been strictly complied with by PAL for its fiscal year which
ended on 31 March 2001.
Even conceding that the construction of a statute by the CIR is to be given
great weight, the courts, which include the CTA, are not bound thereby if such
construction is erroneous or is clearly shown to be in conflict with the governing
statute or the Constitution or other laws. "It is the role of the Judiciary to refine
and, when necessary, correct constitutional (and/or statutory) interpretation, in
the context of the interactions of the three branches of the government."30 It is
furthermore the rule of long standing that this Court will not set aside lightly the
conclusions reached by the CTA which, by the very nature of its functions, is
dedicated exclusively to the resolution of tax problems and has, accordingly,
developed an expertise on the subject, unless there has been an abuse or
improvident exercise of authority.31 In the Petition at bar, the CTA en banc and
in division both adjudged that PAL is not liable for MCIT under Presidential
Decree No. 1590, and this Court has no sufficient basis to reverse them.
As to the assertions of the CIR that exemption from tax is not presumed, and
the one claiming it must be able to show that it indubitably exists, the Court
recalls its pronouncements in Commissioner of Internal Revenue v. Court of
Appeals32:
We disagree. Petitioner Commissioner of Internal Revenue erred in applying
the principles of tax exemption without first applying the well-settled doctrine of
strict interpretation in the imposition of taxes. It is obviously both illogical and
impractical to determine who are exempted without first determining who are
covered by the aforesaid provision. The Commissioner should have determined
first if private respondent was covered by Section 205, applying the rule of strict
interpretation of laws imposing taxes and other burdens on the populace,
before asking Ateneo to prove its exemption therefrom. The Court takes this
occasion to reiterate the hornbook doctrine in the interpretation of tax laws that
"(a) statute will not be construed as imposing a tax unless it does so clearly,
expressly, and unambiguously. x x x (A) tax cannot be imposed without clear
and express words for that purpose. Accordingly, the general rule of requiring
adherence to the letter in construing statutes applies with peculiar strictness to
tax laws and the provisions of a taxing act are not to be extended by
implication." Parenthetically, in answering the question of who is subject to tax
statutes, it is basic that "in case of doubt, such statutes are to be construed
most strongly against the government and in favor of the subjects or citizens
because burdens are not to be imposed nor presumed to be imposed beyond
what statutes expressly and clearly import." (Emphases ours.)
For two decades following the grant of its franchise by Presidential Decree No.
1590 in 1978, PAL was only being held liable for the basic corporate income
tax or franchise tax, whichever was lower; and its payment of either tax was in
lieu of all other taxes, except real property tax, in accordance with the plain
language of Section 13 of the charter of PAL. Therefore, the exemption of PAL
from "all other taxes" was not just a presumption, but a previously established,
accepted, and respected fact, even for the BIR.
The MCIT was a new tax introduced by Republic Act No. 8424. Under the
doctrine of strict interpretation, the burden is upon the CIR to primarily prove
that the new MCIT provisions of the NIRC of 1997, clearly, expressly, and
unambiguously extend and apply to PAL, despite the latter’s existing tax
exemption. To do this, the CIR must convince the Court that the MCIT is a
basic corporate income tax,33 and is not covered by the "in lieu of all other
taxes" clause of Presidential Decree No. 1590. Since the CIR failed in this
regard, the Court is left with no choice but to consider the MCIT as one of "all
other taxes," from which PAL is exempt under the explicit provisions of its
charter.
Not being liable for MCIT in FY 2000-2001, it necessarily follows that PAL need
not apply for relief from said tax as the CIR maintains.
WHEREFORE, premises considered, the instant Petition for Review is hereby
DENIED, and the Decision dated 9 August 2007 and Resolution dated 11
October 2007 of the Court of Tax Appeals en banc in CTA E.B. No. 246 is
hereby AFFIRMED. No costs.
SO ORDERED.
MINITA V. CHICO-NAZARIO
Associate Justice
WE CONCUR:
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
ANTONIO EDUARDO B.
PRESBITERO J. VELASCO, JR.
NACHURA
Associate Justice
Associate Justice
DIOSDADO M. PERALTA
Associate Justice
ATTESTATION
I attest that the conclusions in the above Decision were reached in consultation
before the case was assigned to the writer of the opinion of the Court’s Division.
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson, Third Division
CERTIFICATION
Pursuant to Article VIII, Section 13 of the Constitution, and the Division Chairman’s
Attestation, it is hereby certified that the conclusions in the above Decision were
reached in consultation before the case was assigned to the writer of the opinion of
the Court’s Division.
REYNATO S. PUNO
Chief Justice
THE UNITED STATES, plaintiff-appellee,
vs.
ANTONIO ABAD SANTOS, defendant-appellant.
Quirino Abad Santos for appellant.
Attorney-General Avanceña for appellee.
MORELAND, J.:
The appellant here is accused of violating the Internal Revenue Law. He was
convicted and sentenced to pay a fine of P10. He appealed.
Section 185 of Act No. 2339 (now section 2727 of the Administrative Code)
reads as follows:
A person who violates any provision of the Internal Revenue Law or
any lawful regulation of the Bureau of Internal Revenue made in
conformity with the same, for which delinquency no specific penalty is
provided by law, shall be punished by a fine of not more than three
hundred pesos or by imprisonment for not more than six months, or
both.
Pursuant to the authorization in the Internal Revenue Law, the Collector of
Internal Revenue issued Circular No. 467, the third section of which reads as
follows:
3. Printers, publishers, contractors, common carriers, etc. — Each
printer, publisher, contractor, warehouseman, proprietor of a dockyard,
keeper of a hotel or restaurant, keeper of a livery stable or garage,
transportation contractor and common carrier by land or water, and so
forth, subject to the tax imposed by sections 42, 43, and 44 of Act No.
2339, shall keep a day book in which he shall enter in detail, in English
or Spanish, each amount of money received in the conduct of his
business. Before being used for said purpose, the pages of the book
must be numbered serially in a permanent and legible manner, and the
book itself presented to an internal revenue agent or office for approval.
In this book the cash receipts of the owner thereof shall be entered
under the corresponding date within the twenty-four hours next
following the date the money was received. If no money is received on
any day, then that fact shall be noted in the book within the said twenty-
four hours under the corresponding date.
The appellant is the owner of a printing establishment called "The Excelsior"
and as such was required by law to keep a book in which he should make the
entire required by the above quoted regulation. It is charged in the information
that he violated the provisions of said regulation in that he failed to make any
entry for the 5th day of January, 1915, indicating whether any business was
done on that day or not.
We are of the opinion that the accused must be acquitted. It appears
undisputed that he regularly employed a bookkeeper who was in complete
charge of the book in which the entries referred to should have been made and
that the failure to make the entry required by law was due to the omission of the
bookkeeper of which appellant knew nothing.
We do not believe that a person should be held criminally liable for the acts of
another done without his knowledge or consent, unless the law clearly so
provides. In the case before us the accused employed a bookkeeper, with the
expectation that he would perform all the duties pertaining to his position
including the entries required to be made by the Collector of Internal Revenue.
It is undisputed that the accused took no part in the keeping of the book in
question in this case and that he personally never made an entry in it. He left
everything to his bookkeeper. Under such circumstances we do not believe that
the mere proof of the fact that the bookkeeper omitted to make the entries
required by the Internal Revenue Circular for the 5th day of January, 1915, is
an act upon which the conviction of the accused can be based. No knowledge
on his part was shown with regard to the bookkeeper's omission and the
Government does not contend that he had any knowledge. Nor is it contended
that the bookkeeper omitted the entry under the direction of the accused or with
his connivance. No connection between the accused and the omission of the
bookkeeper is shown or claimed. On the contrary the board contention is that
the accused is responsible for the acts and omissions of his bookkeeper, and
that, if any act or omissions of his bookkeeper, violates the criminal law, the
principal is responsible criminally.
With this we cannot agree. Neither the statute nor the circular of the Collector
of Internal Revenue, nor both together, expressly require such a result nor can
we say from the circular or the law that the intention to do so was so clear as to
leave no room for doubt. Courts will not hold one person criminally responsible
for the acts of another, committed without his knowledge or consent, unless
there is a statute requiring it so plain in its terms that there is no doubt of the informations with costs de oficio and cancelling the bail bond filed by the
intention of the Legislature. Criminal statutes are to be strictly construed. No accused. The court in the same order directed the Regional Representative of
person should be brought within their terms who is not clearly within them, nor the Department of Labor to immediately institute a civil action against the erring
should any act be pronounced criminal which is not clearly made so by the employer for the collection of the alleged underpayment of wages due the
statute. (U. S. vs. Madrigal, 27 Phil. Rep., 347.) employees. A motion for reconsideration having been denied, the Government
took the present appeal.
The judgment of conviction is reversed and the accused acquitted. Costs de The pertinent portion of Section 3 of Republic Act 602 under which appellee
officio. So ordered. was prosecuted, reads as follows:.
SEC. 3. Minimum wage. — (a) Every employer shall pay to each of his
Arellano, C. J., Torres and Araullo, JJ., concur. employees who is employed by an enterprise other than in agriculture
Carson and Trent, JJ., dissent. wages at the rate of not less than —
(1) Four pesos a day on the effective date of this Act and thereafter for
employees of an establishment located in Manila or its environs;
THE PEOPLE OF THE PHILIPPINES, plaintiff-appellant,
(2) Three pesos a day on the effective date of this Act and for one year
vs.
after the effective date, and thereafter P4 a day, for employees of
ALFONSO GATCHALIAN, defendant-appellee.
establishment located outside of Manila or its environs: Provided, That
Office of the Solicitor General Ambrosio Padilla and Solicitor Troadio T.
this Act shall not apply to any retail or service enterprise that regularly
Quiazon, Jr. for appellant.
employs not more than five employees.
Ishmael Rodriguez for appellee.
Section 15 of the same law, which treats of "penalties and recovery of wages
BAUTISTA ANGELO, J.:
due", likewise provides:
Alfonso Gatchalian was charged before the Court of First Instance of
SEC. 15. Penalties and recovery of wage due under this Act. —
Zamboanga with a violation of Section 3 of Republic Act No. 602 in four
(a) Any person who wilfully violates any of the provisions of this Act
separate informations (Criminal Cases Nos. 2206, 2207, 2208 and 2209)
shall upon conviction thereof be subject to a fine of not more than two
committed as follows:
thousand pesos, or, upon second conviction, to imprisonment of not
That on or about August 4, 1951, up to and including December 31,
more than one year, or to both fine and imprisonment, in the discretion
1953 and within the jurisdiction of this Court, viz, in the City of
of the court.
Zamboanga, Philippines, the above named accused, owner or manager
(b) If any violation of this Act is committed by a corporation, trust,
of the New Life Drug Store, a business establishment in the City of
partnership or association, the manager or in his default, the person
Zamboanga and having under his employ one Expedito Fernandez as
acting as such when the violation took place, shall be responsible. In
salesman in the said establishment, did then and there willfully, and
the case of a government corporation, the managing head shall be
feloniously, pay and cause to be paid to said Expedito Fernandez, a
made responsible, except when shown that the violation was due to an
monthly salary of P60 to P90 for the period above-mentioned which is
act or commission of some other person, over whom he has no control,
less than that provided for by law, thereby leaving a difference of an
in which case the latter shall be held responsible.
unpaid salary to the latter in the total amount of P1,016.64 for the
(c) The Secretary is authorized to supervise the payment of the unpaid
period above-mentioned.
minimum wages or the wages found owing to any employee under this
When arraigned on June 19, 1956, he pleaded not guilty to the charge. On
Act.
August 29, 1956, his counsel, in his behalf, filed a written motion to dismiss
(d) The Secretary may bring an action in any competent court to
based on two grounds which in substance merely consist in that the violation
recover the wages owing to an employee under this Act, with legal
charged does not constitute a criminal offense but carries only a civil liability,
interest. Any sum thus recovered by the Secretary on behalf of an
and even if it does, the section of the law alleged to have been violated does
employee pursuant to this subsection shall be held in a special deposit
not carry any penalty penalizing it. On September 25, 1956, the City Attorney of
account and shall be paid, on order of the Secretary, directly to the
Zamboanga filed his answer to the motion to dismiss contending that the law
employee or employees affected. Any such sums not paid to an
which was violated by the accused carries with it both civil and criminal liability,
employee because he cannot be located within a period of three years
the latter being covered by Section 15 which provides for the penalty for all
shall be covered into the Treasury as miscellaneous receipts.
willful violations of any of the provisions of the Minimum Wage Law. On
(e) Any employer who underpays an employee in violation of this Act
December 3, 1956, the Court, after hearing the arguments of both parties, as
shall be liable to the employee affected in the amount of the unpaid
well as some members of the local bar, issued an order dismissing the
wages with legal interest. Action to recover such liability may be
 maintained in any competent court by anyone or more employees on
behalf of himself or themselves. The court in such action shall, in
addition to any judgment awarded to the plaintiff or plaintiffs, allow a
reasonable attorney's fee which shall not exceed ten per cent of the
amount awarded to the plaintiffs, unless the amount awarded is less
than one hundred pesos, in which event the fee may be ten pesos, but
not in excess of that amount. Payment of the amount found due to the
plaintiffs shall be made directly to the plaintiffs, in the presence of a
representative of the Secretary or the Court. In the event payment is
witnessed by the court or its representative, the Secretary shall be
notified within ten days of payment that the payment has been made.
(f) No employer, attorney, or any other person, other than the employee
to whom underpayment are found due, shall receive any part of the
underpayment due the employee; and no attorney shall receive any fee
in excess of the maximum specified herein.
(g) In determining when an action is commenced under this section for
the purpose of the statute of limitation, it shall be considered to be
commenced in the case of any individual claimant on the date when the
complaint is filed if he is specifically named as a party plaintiff in the
complaint, or if his name did not so appear, on the subsequent date on
which his name is added as a party plaintiff in such action.
It is clear from the above-quoted provisions that while Section 3 explicitly
requires every owner of an establishment located outside of Manila or its
environs to pay each of its employees P3.00 a day on the effective date of the
Act, and one year thereafter P4.00 a day, Section 15 imposes both a criminal
penalty for a willful violation of any of the above provisions and a civil liability for
any underpayment of wages due an employee. The intention of the law is clear:
to slap not only a criminal liability upon an erring employer for any willful
violation of the acts sought to be enjoined but to attach concurrently a civil
liability for any underpayment he may commit as a result thereof. The law
speaks of a willful violation of "any of the provisions of this Act", which is all-
embracing, and the same must include what is enjoined in Section 3 thereof
which embodies the very fundamental purpose for which the law has been
adopted. A study of the origin of our Minimum Wage Law (Republic Act 602)
may be of help in arriving at an enlightened and proper interpretation of the
provisions under consideration. Our research shows that this Act was patterned
after the U. S. Fair Labor Standards Act of 1938, as amended, and so a
comparative study of the pertinent provisions of both would be enlightening.
The pertinent provisions of the U. S. Fair Labor Stardards Act of 1938, as
amended, follow:
MINIMUM WAGES.
SEC. 6. (a) Every employer shall pay to each of his employees who is
engaged in commerce or in the production of goods for commerce
wages at the following rates —
(1) not less than 75 cents an hour;
xxx     xxx     xxx
PROHIBITED ACTS
SEC. 15. (a) After the expiration of one hundred and twenty days from
the date of enactment of this Act, it shall be unlawful for any person —
(1) to transport, offer for transportation, ship, deliver, or sell in
commerce, or to ship, deliver, or sell with knowledge that shipment or
delivery or sale thereof in commerce is intended, any goods in the
production of which any employee was employed in violation of section
6 or section 7, or in violation of any regulation or order of the
Administrator issued under section 14; . . . .
(2) to violate any of the provisions of section 6 or section 7, or any of
the provisions of any regulation or order of the Administrator issued
under section 14;
(3) to discharge or in any other manner discriminate against any
employee because such employee has filed any complaint or instituted
or cause to be instituted any proceeding under or related to this Act, or
has testified or is about to testify in any such proceeding, or has served
or is about to serve on an industry committee;
(4) to violate any of the provisions of section 11 (c) or any regulation or
order made or continued in effect under the provisions of section 11 (d),
or to make any statement, report, or record filed or kept pursuant to the
provisions of such section or of any regulation or order thereunder,
knowing such statement, report, or record to be false in a material
respect.
xxx     xxx     xxx
PENALTIES
SEC. 16. (a) Any person who willfully violates any of the provisions of
section 15 shall upon conviction thereof be subject to a line of not more
than P10,000, or to imprisonment for not more than six months, or both.
No person shall be imprisoned under this subsection except for an
offense committed after the conviction of such person for a prior
offense under this subsection.
(b) Any employer who violates the provisions of section 6 or 7 of this
Act shall be liable to the employee or employees affected in the amount
of their unpaid minimum wages, or their unpaid overtime compensation,
as the case may be, and in additional equal amount as liquidated
damages. Action to recover such liability may be maintained in any
court of competent jurisdiction by any one or more employees for and in
behalf of himself or themselves and other employees similarly situated.
No employee shall be a party plaintiff to any such action unless he
gives his consent in writing to become such a party and such consent is
filed in the court in which such action is brought. The court in such
action shall, in addition to any judgment awarded to the plaintiff or
plaintiffs, allow a reasonable attorney's fee to be paid by the defendant
costs of the action.
The pertinent provisions of Republic Act 602 read:
SEC. 3. Minimum wage. — (a) Every employer shall pay to each of his
employees who is employed by an enterprise other than in agriculture
wages at the rate of not less than —
 xxx     xxx     xxx
(2) Three pesos a day on the effective date of this Act and for one year
after the effective date, and thereafter P4 a day, for employees of
establishments located outside of Manila or its environs: Provided, That
this Act shall not apply to any retail or service enterprise that regularly
employs not more than five employees.
SEC. 15. Penalties and recovery of wage due under this Act. —
(a) Any person who willfully violates any of the provisions of this Act
shall upon conviction thereof be subject to a fine of not more than two
thousand pesos, or, upon second conviction, to imprisonment of not
more than one year, or to both fine and imprisonment, in the discretion
of the court.
xxx     xxx     xxx
(e) Any employer who underpays an employee in violation of this Act
shall be liable to the employee affected in the amount of the unpaid
wages with legal interest. Action to recover such liability may be
maintained in any competent court by anyone or employees on behalf
of himself or themselves. The court in such action shall, in addition to
any judgment awarded to the plaintiff or plaintiffs, allow a reasonable
attorney's fee which shall not exceed ten per cent of the amount
awarded to the plaintiffs, unless the amount awarded is less than one
hundred pesos, in which event the fee may be ten pesos, but not in
excess of that amount. Payment of the amount found due to the
plaintiffs shall be made directly to the plaintiffs, in the presence of a
representative of the Secretary or of the Court. In the event payment is
witnessed by the court or its representative, the Secretary shall be
notified within ten days of payment that the payment has been made.
An examination of the above-quoted provisions of the two Acts will show that
while in substance they are similar, they however contain some differences in
their phraseology and in the apportionment of their provisions. Thus, while
Section 15 (a), paragraph 2, of the Fair Labor Standards Act makes it unlawful
for an employer not to pay the minimum wage prescribed therein, our Minimum
Wage Law does not contain a similar provision. Again, the Fair Labor
Standards Act enumerates in one single section all those acts which are
declared unlawful and are not spread out in different sections as done in our
law. Thus, the acts that are declared unlawful by the former law as enumerated
in Section 15(a) are: (1) to transport or deliver any goods in the production of
which any employee was employed in violation of Section 6 or Section 7, or in
violation of any regulation or order of the Administrator; (2) failure to pay the
minimum wage; (3) to discharge or in any other manner discriminate against an
employee who has filed a complaint against the employer in relation to the Act;
and (4) failure to keep the record or report required by law or to make a false
record or report. On the other hand, our law declares unlawful the following
acts, to wit: (1) to pay wages in the form of promissory notes, vouchers,
coupons, tokens or any other form alleged to represent legal tender [Section 10
(a) (1)]; (2) to make any deduction or withhold any amount from the wages of
an employee, or induce any employee to give part of his wages by force or
intimidation [ Section 10 (g)]; (3) to commit any act of discrimination against an
employee because of certain complaint he has filed or caused to be filed
against the employer (Section 13); and (4) to make any false statement, report
or record to subvert the purpose of the Act (Section 14), which acts are
contained in separate sections mentioned therein. The failure to pay the
prescribed minimum wage is not declared unlawful in our law.
It should also be noted that while Section 16 of the Fair Labor Standards Act
which provides for the penalties to be imposed for any willful violation of the
provisions of the Act specifically states that those penalties refer to acts
declared unlawful under Section 15 of the same Act, our law does not contain
such specification. It merely provides in Section 15 (a) that "Any person who
willfully violates any of the provisions of this Act shall upon conviction" be
subject to the penalty therein prescribed. This distinction is very revealing. It
clearly indicates that while the Fair Labor Standards Act intends to subject to
criminal action only acts that are declared unlawful, our law by legislative fiat
intends to punish not only those expressly declared unlawful but even those not
so declared but are clearly enjoined to be observed to carry out the
fundamental purpose of the law. One such provision is undoubtedly that which
refers to the payment of the minimum wage embodied in Section 3. This is the
only rational interpretation that can be drawn from the attitude of our Congress
in framing our law in a manner different from that appearing in the mother law.
Indeed, the main objective of the law is to provide for a rock-bottom wage to be
observed and by an employers of an agricultural and industrial establishment.
This objective would be defeated were we to adopt a restrictive interpretation of
the above penal clause, for an employer who knows that he cannot be
amenable to a criminal action would be prone to subvert the law because if he
is detected it would be easy for him to pay the underpayment and the
corresponding interest as would be the case were he to assume merely a civil
liability. This would be a mockery and a derision of the law not contemplated by
our lawmaker which would certainly render it nugatory and abortive. We are not
prepared to adopt an interpretation which would give such adverse result to a
legislation conceived in the lofty purpose of protecting labor and giving it a
living wage. If the law is to survive, it must be real, militant and effective.
The establishment of the maximum wage benefits directly the low-
paid employees, who now receive inadequate wages on which to sup
port themselves and their families. It benefits all wage earners indirec
tly by setting a floor below which their remuneration cannot fail. It rais
es the standards of competition among employers, since it would prot
ect the fair-minded employer who voluntarily pays a wage that suppor
ts the wage earner from the competition of the employer, who operat
es at lower cost by reasons of paying his workers a wage below subs
istence. If, in fact, the employer cannot pay a subsistence wage, then 
he should not continue his operation unless he improves his methods 
and equipment so as to make the payment of the minimum wage fea
sible for him; otherwise the employer is wasting the toil of the worker 
and the material resources used in the employment. Second methods 
of operation, progressive and fair-minded management, and an adequ
 ate minimum wage go hand in hand. (Explanatory Note to H.B. No. 1
476).
Counsel for appellee however entertains a different interpretation. He contends
that if Section 15(a) should be interpreted in a manner that would embrace a
willful violation of any of the provisions of the law we would have a situation
where even the officials entrusted with its enforcement may be held criminally
liable which is not contemplated in the law. Thus, he contends, the Secretary of
Labor may be criminally prosecuted for willfully not using all available devices
for investigation [Section 4 (c)], for not presenting to the Wage Board all the
evidence in his possession relating to the wages in the industries for which the
Wage Board is appointed and other information relevant to the establishment of
the minimum wage [Section 5 (p)], and for not doing all other acts which the law
requires him to do under Section 6. This, he emphasizes, is absurd and should
not be entertained.
To begin with, the Minimum Wage Law is a social legislation which has been
adopted for the benefit of labor and as such it contains provisions that are
enjoined to be observed by the employer. These provisions are substantive in
nature and had been adopted for common observance by the persons affected.
They cannot be eluded nor subverted lest the erring employer runs into the
sanction of the law. On the other hand, the provisions adverted to by counsel
are merely administrative in character which had been adopted to set the
machinery by which the law is to be enforced. They are provisions established
for observance by the officials entrusted with its enforcement. Failure to comply
with them would therefore subject them merely to administrative sanction. They
do not come under the penal clause embodied in Section 15(a). This is clearly
inferred from Section 18(c), of Republic Act No. 602, which provides: "Any
official of the Government to whom responsibility in administration and
enforcement has been delegated under this Act shall be removable on the
sustaining of charges of malfeasance or non-feasance in office." This specific
provision should be interpreted as qualifying the penal clause provided for in
Section 15(a).
It is true that Section 3 under which appellee was charged does not state that it
shall be unlawfull for an employer to pay his employees wages below the
minimum wage but merely requires that the employer shall pay wages not
below the minimum wage. But failure of such declaration does not make the
non-observance of the provisions less unlawful than otherwise, for such
provision embodies precisely the raison d'etre of the law itself. Indeed, Section
3 is the very provision on which all the other provisions of the law are built.
Thus, the prohibition against discriminating against any employee because he
has filed a complaint or caused to be instituted one against the employer is just
a means to insure the effective enforcement of that provision (Section 13); and
so the prohibition against the making of a false statement, report or record
required to be filed or kept by the law (Section 13); the prohibition against the
payment of wages in the form of promissory notes, vouchers, coupons, tokens,
or any other form to represent legal tender (Section 10, par. a, sub-paragraph
1); and the prohibition against making deductions or withholding any amount
from the wages of an employee (Section 10, par. g). These are acts which were
declared unlawful because they may be resorted to by unscrupulous employers
with the evident purpose of subverting or defeating the payment of the
minimum wage. If these supplementary provisions are mere safeguards
established by the lawmaker to close every avenue to trickery or subversion on
the part of the employer, they cannot be more important and imperative as the
central provision fixing the minimum wage without which the law will have no
reason to exist. We cannot therefore entertain the claim that because said
provision was not declared unlawful it cannot be subject to the penal sanction
embodied in Section 15.
It is likewise true that the informations under which the accused was charged
only mention Section 3 of the law as the one violated and this section does not
contain a penal clause, but this does not make the informations defective.
There is no law which requires that in order that an accused may be convicted
the specific provision which penalizes that act charged be mentioned in the
information. The Rules of Court do not require such designation. In fact, the
rule provides that an information, to be sufficient, should state only the name of
the defendant, the designation of the offense by the statute, the acts or
omissions complained of as constituting the offense, the name of the offended
party, the approximate time of the commission of the offense, and the place
wherein the offense was committed (Rule 106, Section 5). The rule does not
require that it should mention the particular penal provision penalizing the
offense.
The final claim of appellee is that inasmuch as the provisions of the law under
which he was prosecuted are ambiguous and there is doubt as to their
interpretation, that doubt should be resolved in his favor because a penal
statute should be strictly construed against the State. This contention must also
fail if we are to be consistent with our interpretation of the provisions of Section
15 (a) of the law. We have stated that that section is clear and unambiguous
and covers the provisions embodied in Section 3 of the law, and if such is the
case then there is no room for the application of the principle invoked by
appellee.
We are therefore persuaded to conclude that the court a quo erred in
dismissing the informations filed against the appellee and, consequently, its
order of December 3, 1956, subject of this appeal should be set aside.
Wherefore, the order appealed from is hereby set aside. It is ordered that these
cases be remanded to the court a quo for further proceedings, with costs
against appellee..
Paras, C. J., Padilla, and Endencia, JJ., concur.
Separate Opinions
CONCEPCION, J., concurring:
I concur in the foregoing opinion, as well as in the concurring opinion of Mr.
Justice Reyes (J. B. L.).
REYES, J. B. L., concurring:
I concur in the opinion of Mr. Justice Felix Bautista Angelo, particularly in view
of the provisions of Sec. 10, paragraph g of the Minimum Wage Act which
reads as follows:.
SEC. 10 (g). It shall be unlawful for any person, including but not
restricted to, any employer . . . to make any deductions or withold any
amount from the wages of an employee . . . by force, intimidation,
threat, or procuring dismissal or in any manner whatsoever.
If the act declares unlawful to withhold in any manner whatsoever any amount
from the wages of an employee, it must necessarily be unlawful not to pay him
the wage called for by the Minimum Wage Act. What is the difference between
not paying the minimum wage and withholding part of the wage so the balance
is below the minimum wage? To underpay is to withhold part of the wage.
The act complained of, therefore, is an offense penalized under the Act. Our
duty being to interpret the Act in consonance with its primary purpose to benefit
the laborer, we should consider that the only sanction for not paying the
minimum wage were to be the payment of interest on the unpaid salary, the
situation of the wage earner would have been in no way advanced and the
Minimum Wage Act would be practically nullified, for a laborer is in no position
to engage in protracted litigation with his employer. As pointed in the opinion of
Justice Bautista Angelo the criminal liability is the only effective sanction under
the circumstances. The rejection of the Tañada amendment merely proves that
the Legislature was against heavier penalties at the start, not that it desired to
shield anyone from prosecution.
It is not for us to speculate upon the secondary effects of the Act on industry.
To foresee them is the task of the Legislature. If it desired to immunize
employers against criminal prosecution, as an exception to the general penalty,
it could have clearly so stated. On the other hand if it wished to be ambiguous
in order to content both Capital and Labor, I think the Court would be advancing
the cause of good government by driving home the necessity that laws be
carefully framed and clearly worded.
The function of statutory interpretation, in my opinion, is to cure involuntary
mistakes and supply inadvertences; not to ferret out of ambiguities a policy that
legislators may be afraid or unwilling to express. If it is unconstitutional for the principle that "every person criminally liable is also civilly liable." My answer is
Judiciary to invade the sphere of the Legislature, it is just as unlawful for the
legislators to shirk their own duty and divert to the Judges the odium of
unpopular measures. Que cada palo aguante su vela — each mast should
bear its own sail.
BENGZON, J., dissenting:
Concurring in the dissent of Mr. Justice Montemayor, I wish to emphasize that
as applied to this case, Sec. 15, subsections (a) and (e) should be read
together substantially as follows:
Any person who violates any provision of this Act shall be punished
with fines, etc. . . . except that where the violation consists in paying the be subject to criminal prosecution and the guilty person, etc." (Sec. (10).
employee less than the minimum wage, the employer shall be punished
by requiring him to satisfy the difference, plus attorney's fees.
I believe subsection (e) punishes the particular "violation" of paying less than
the minimum wage. It is a special provision, which under well-known rules of
construction, should prevail over the general provision in subsection (a). In
other words, although the Act does not expressly say so, subsection (e) is an
exception1 to subsection (a).
I think it is a mistake to suppose that this interpretation fails to punish the
employer who disregards the Act; because the liability imposed by subsection
(e) is unquestionably a sanction, penal in nature, which except for the law,
would not be demandable. If Juan De la Cruz, by contract, employs Pedro at
P3.00 per day in Manila where the law fixes a minimum daily wage of P4.00,
Pedro could not recover P4.00 instead of P3.00 (except for this law) because
Pedro agreed to the 3-peso wage. Nevertheless, this subsection (e)
says, despite such agreement with Pedro, Juan must pay him at the rate of
P4.00 a day, plus attorney's fees. He is required to pay what he did not
contract to pay, or could not afford to pay. Is not this a punishment imposed on
Juan? Remember that fine, which is also a punishment consists in the
disbursement of money.
But such payment is insufficient penalty, I hear others argue. This case will
easily disprove such argument: Under subsection (e) this appellee would have
to pay necessarily P1,016.00, plus attorney's fees; whereas under subsection
(a) he might be fined P200.00 only.2
However, the majority will counter, we hold that the employer, is liable under
subsection (e) in addition to his liability under subsection (a).
Therein lies the trouble; the words "in addition" or words of similar import, were
not inserted in subsection (e), as they could have been inserted.
Additional liability, is their prevailing idea. And yet, why should the law impose
on the employer (who pays in accordance with a contract freely entered into),
additional burdens not imposed on the other employers willfully violating other
fundamental provisions of the Act.
It may be argued that subsection (e) is not really a sanction independent of
subsection (a), or additional thereto, because it merely repeats the well-known
twofold: first, attorney's fees are not usually included in such principle — a
robber is not required to pay attorney's fees; second, the employee is not really
the injured party because he accepted the employment under a contract:
"Scienti et volenti nulla fit injuria." There is no violation of any right of the
employee for which reparation is due. In the example given, Pedro had no right
to require Juan to employ him at P4.00. There is only a breach of the statute,
for which the Government can choose, and did choose the proper sanction,
namely, payment of the salary differential under subsection (e). The Congress
did not choose more than that; contrary to what it did in analogous situations.
Take the Usury Law, for instance; it provides "without prejudice to the proper
civil action for the recovery of usurious interest paid, violations of this Act shall
In the absence of a clear, unmistakable statute, we should not approve two amendment. The Legislature was, as it were, venturing out on an uncharted
punishments for one and the same misconduct. sea; so it had to be conservative and move with measured steps. Since the law
was merely being tried out as an experiment, its provisions could not have
been made and intended to be strict and severe, in the sense that because of
MONTEMAYOR, J., dissenting: their severity and strictness, compliance therewith would be difficult, if not
To my knowledge, this is the first time that the Minimum Wage Law is being impossible, and would result in their non observance, and the consequent
interpreted by this Tribunal, as regards the compass and scope of the penalty punishment by fine and prison sentence of those defined as employers who are
provided in Section 15 of said law, so that on this subject matter, this will be the unable to comply with said provisions. The net result would be the unjust
first case and a leading one. The trial court in its order dismissing the punishment of innocent government officials and the discouragement and
information said that it had carefully considered its ruling or order because "it destruction of infant and small industries..
believes that any resolution, one way or another, would be precedent-setting, From the explanatory note of Senate Bill No. 202, we may have an idea of the
because until now, the Supreme Court has not directly ruled upon the point." attitude of the Legislature on this particular point:
Under the interpretation given by the majority, any employer who underpays his One thing to be remembered is that the country has not yet attained
employees in violation of the Minimum Wage Law (Section 3) would be subject that degree of industrialization where wages can be set at fully
to criminal prosecution. I am afraid that if that is the law, the prosecuting satisfactory levels from the viewpoints of human values. Compromises
attorneys and fiscals would have on their hands not only the prosecution of must still be made until this full industrial status is attained. Another
thousands of private employers who may be paying their employees and thing is that hasty and unjudicious action in passing minimum wage
laborers amounts less than the minimum wage, however small the deficiency, laws may be deterrent to private capital which, on the contrary needs to
but also hundreds and thousands of provincial and municipal officials, be encouraged to invest in local industries if the industrialization of our
particularly the latter, who are paying their employees, not excluding peace country must someday be a fact. (Emphasis supplied).
officers like municipal policemen and patrolmen, salaries which are way below As the majority opinion correctly observes, our Minimum Wage Law is
the minimum wage of P4.00 a day. It is a well known fact that in this respect, patterned after that of the United States Fair Labor Standards Act (F.L.S.A.) of
the Government is the first and worst offender. Even first class municipalities 1938, as amended. As I have already stated, the establishment of this
cannot afford and naturally do not pay their employees and peace officers the minimum wage in this country being a sort of experiment, it being the first time
minimum wage; with more reason cannot second class and third class that it was being tried out, and not knowing whether or not it would be a
municipalities do so. success, it is to be presumed that the Legislature acted cautiously and warily,
The majority opinion will have such far-reaching and to me, unforeseen and even while adopting as a pattern the United States F.L.S.A., it did not wish
consequences, at once baneful, undesirable, and hurtful to industry, and or Intend to make our law more stern and strict in its enforcement and
disastrous to local government officials who, strictly speaking, are not to blame, application, particularly as regards its penalties. But the majority opinion would
that I am constrained to voice my dissent and explain the reasons therefor. make our law more rigorous and severe, more comprehensive and more
For a better understanding of the adoption of the minimum wage in this devastating in the application of its penal provisions. For instance, while the
jurisdiction, it is well to remember that it was not of the initiative, idea or volition F.L.S.A. in Section 16(a) penalizes only specific violations of its provisions
of this country. It was recommended by the Bell Mission which made an expressly enumerated, our law as interpreted by the majority opinion, would
economic survey here and in its report, recommended its establishment. Not punish any violation whatsoever, whether enumerated specifically or not.
only this, but it would appear that the enactment of this Minimum Wage Law Moreover, while Section 15(a) of the F. L. S. A. makes it unlawful for an
was made a condition precedent to economic aid to be given to us by the employer not to pay the minimum wage prescribed by it, our Minimum Wage
United States of America. 1 Law does not contain a similar provision. What our law declares unlawful are
In connection with the discussion and enactment of this piece of legislation, not certain positive and affirmative acts, such as, paying wages in the form of
only our economists but also our legislators expressed their fears, doubts and promissory notes, vouchers, etc.; making deductions or withholding any
misgivings, fully realizing that the country was not perhaps prepared amount from the wages of an employee, or inducing any employee to give part
economically for its adoption and operation. But because of our commitment of his wages by force or intimidation; committing any act of discrimination
with America,  and possibly realizing also the necessity of establishing a fair
2 against an employee because of a certain complaint he had filed against the
minimum standard of wages for laborers and employees, the Legislature employer, or making any false statement in any report or record to subvert the
enacted this law in the nature of an experiment, carefully watching and purposes of the Act. These acts must have been regarded by the Legislature
observing in its operation, execution and observance, its good points and its as serious and so expressly declared them unlawful. However, the mere failure
shortcomings as well, with the idea of later making the necessary changes and to pay the prescribed minimum wage is not, in our law, declared unlawful. I
believe that what the Legislature intended to penalize with fine and prison
sentence were only those acts which it enumerated and declared unlawful, not
the mere failure to follow and comply with the obligations imposed upon an
employer, such as, the nonpayment of the minimum wage.
It will be noticed that our law expressly provides that any employer underpaying
an employee in violation of the Act shall be liable to said employee in the
amount of the underpayment, with legal interest, plus a reasonable amount for
attorney's fees. This amount may be recovered not only by the employee
himself, but by the Secretary of Labor on his behalf. In my opinion, this civil
responsibility to be enforced with the aid of the Department of Labor, was
regarded as sufficient punishment and deterrent on the employer. Being a civil
action, the employee only needs preponderance of evidence to win his suit.
The Legislature may have been of the belief that application of the penal
sanction in the form of fine and prison sentence would be too radical a
measure, would scare and discourage new and infant industries, besides
inducing violators to resort to underhanded but effective measures to hide and
conceal infringement of the law, to say nothing of the added difficulty in
securing conviction, which requires not only preponderance of evidence, but
proof of guilt beyond reasonable doubt.
To show that the Legislature did not intend to be too severe and stern in the
application of this new law which was merely being tried out, while House Bill
No. 1732 was being discussed in the Senate, Senator Tañada believing that
the bill was too lenient for those who violated its provisions by providing for a
fine of only not more than P1,000.00 or imprisonment of not more than six
months, he proposed that the fine be increased to not more than P10,000.00 —
half the amount of the fine provided in Section 16(a) of the U.S. Fair Labor
Standards Act; but the committee sponsoring the bill, through Senator Torres,
objected to the proposed amendment as being too excessive and severe,
specially at the beginning of the operation of the law, upon which Senator
Tañada withdrew his amendment, with the understanding that in a year or so
after the promulgation of the law, it will be amended:.
SENATE
December 22, 1950.
ENMIENDA TAÑADA
SENATOR TAÑADA. Mr. President for another amendment, On page
18, Section 15 provides for penalties. Mr. President, I believe that the
bill is too lenient for those who violate the provisions of this measure. It
only provides for a fine of not more than one thousand pesos or
imprisonment of not more than six months, or both. In order to really
protect labor we must make the penalty stiffer than what is provided in
this bill. So I propose the following amendment: In line 22, delete the
word "one" between the words "than" and "thousand", and insert in its
place the word "ten"--not more than ten thousand pesos".
EL PRESIDENTE. Que dice el comite?
EL SENADOR TORRES. Señor Presidente, el Comite siente no poder
aceptar la enmienda, en vista de que considera demasiada excesiva la
pena, sobre todo, en los comienzos de la vigencia de la ley.
SENATOR TAÑADA. I then, Mr. President, withdraw my amendment
with the understanding that in a year or so after this Law has been in
force, we shall amend it.
EL PRESIDENTE. Se da por retirada. (Senate Journal, Jan. 5, 1951,
pp. 5-6). (Emphasis supplied).
Going back to the violation of this Minimum Wage Law by the Government
itself, it is a matter of public knowledge that employees like clerks in the office
of the Municipal Treasurer, and municipal policemen receive as low as P40.00
or P50.00 a month, way below the minimum wage prescribed by the law. Under
the interpretation given by the majority, since the word "employer" in the law
includes the Government3 and government corporations, then the municipal
mayor, the municipal councilors and the municipal treasurer who knowingly and
wilfully pay to their employees and policemen salaries way below the minimum
wage, would all be subject to criminal prosecution. Multiply this number of
municipal officials by the number of such towns and municipalities in the
Philippines which do not and cannot pay the minimum wage to their employees
and municipal policemen, which towns and municipalities can be counted by
the hundreds, and we shall have an idea of the number of government violators
of the law which we have and must prosecute criminally under the majority
opinion. Could such mass and wholesale prosecution have been contemplated
and intended by the Legislature? And let it not be said that with respect to said
Government officials, the only punishment is by administrative action and
removal, as provided in Section 18, paragraphs (c) and (d), which read as
follows:
(c) Any official of the Government to whom responsibility in
administration and enforcement has been delegated under this Act
shall be removable on the sustaining of charges of malfeasance or
nonfeasance in office.
(d) Any person engaged in the administration and enforcement of this
Act who is found to have accepted any bribe from or on behalf of any
party in interest under this Act shall be summarily dismissed, and
criminal action shall be instituted against such person. (Emphasis
supplied).
because those provisions clearly refer only to those government officials
entrusted with the administration and enforcement of the law, such as, the
Secretary of Labor the members of the Wage Administration Service, and
others.
But the majority opinion says that not to apply the penal sanction to an
employer underpaying his laborers or employees —
. . . would be a mockery and a derision of the law not contemplated by
our lawmaker which would certainly render it nugatory and abortive. We
are not prepared to adopt an interpretation which would give such
adverse result to a legislation conceived in the lofty purpose of
 protecting labor and giving it a living wage. If the law is to survive, it the Legislature evidently believing that the civil responsibility of the employer
must be real, militant and effective. (Emphasis supplied). for the amount of the underpayment with legal interest and attorney's fees to be
In other words, the majority of this Tribunal on its own initiative would make the enforced with the aid of the Department of Labor, is enough punishment and
Minimum Wage Law militant and effective by a blanket and indiscriminate deterrent on employers.
application of Section 15(a) to all violators of its provisions, whether or not such
violation is expressly or specifically declared unlawful by the law itself. Stated
otherwise, this Tribunal steps in, nay, rushes in to put teeth in a legislation REYES A., J., dissenting:
which it considers toothless and would make effective and militant what it As the majority opinion itself says, "failure to pay the prescribed minimum wage
regards would otherwise be ineffectual and inadequate. This Tribunal would, is not declared unlawful in our law" (Rep. Act No. 602). On the other hand, it is
like one unlicensed to practice medicine, prescribe a cure for a supposed doubtful if the penal sanction prescribed in section 15(a) of that Act —
legislational malady. I am afraid that is not and has never been the province, presumably for the acts and practices therein declared unlawful — could be
much less, the prerogative of the Judiciary. Otherwise, the courts would be rightfully applied to the act of underpaying an employee, since paragraph (e) of
indulging in judicial legislation. that same section already provides a specific remedy therefor. Considering that
If the Minimum Wage Law is found to be inadequate and ineffective, let the penal statutes are strictly construed against the state and in Case of doubt
Legislature make the necessary changes and amendments. In fact, that was courts must adopt the construction favorable to the accused, I vote for the
the legislative plan from the beginning — observe the operation and working of affirmance of the order below and also say that courts should not presume to
the law and then make changes, if deemed necessary. But evidently, the legislate by putting into the law more teeth than the Legislature has already put
Legislature is satisfied with the operation and mode of application of the law, into it.
because although approved on April 6, 1951, and made effective 120 days
thereafter, in other words, after a seven-year operation, it (Legislature) has not
seen fit to introduce any major changes,4 specially in the application of the
penalty.
Anyway, after all is said and done, the least that could be said about the
applicability of Section 15(a) of the Minimum Wage law to violations of Section
3 is doubtful. Even brushing aside and not considering the grave doubts
entertained by the undersigned as to the applicability of said Section 15(a) to
violations of Section 3, we have in evidence the opinion of the Court of First
Instance of Zamboanga and according to it, the opinion of the major sector of
the Zamboanga bar, sustaining the view that Section 15(a) is not applicable to
violations of Sections 3 of the Minimum Wage Law. We have the well settled
principle in the interpretation of penal laws that in case of doubt, the
interpretation favorable to the accused should be adopted. Authorities in
support of this principle are not wanting.
Laws creating, defining, or punishing crimes, and those imposing
penalties and forfeitures, are to be construed strictly against the state or
the party seeking to enforce them, and liberally in favor of the party
sought to be charged. They are not to be enlarged by implications, nor
extended to persons or cases not plainly within the meaning of the
language employed. (Black on Interpretation of Laws, p. 451).
Said this Court in U. S. vs. Abad Santos, 35 Phil. 243:
Criminal statutes are to be construed strictly; no person should be
brought within them, nor should any act be pronounced criminal which
is not made clearly so.
In view of the foregoing, I hold that the penal sanction of the Minimum Wage
Law applies only to certain violations of its provisions, that is to say, those acts
which are expressly declared by the law itself as unlawful; and that mere
nonpayment of the minimum wage is not included in the said penal sanction,