TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION
Due Process
Title Facts
Only applicable appellant Andre Marti and his common-law wife went to the
booth of the Manila Packing and Export Forwarders to send four
to governmental (4) packages to a fiend in Zurich, Switzerland. When asked if the
packages could be examined and inspected, appellant refused,
acts assuring that they were simply gifts of books cigars, and gloves.
The packages were then placed in a box and was sealed with
People V. Marti masking tape for shipment. As a standard operating procedure
before delivering packages to the Bureau of Customs and/or
Burueau of Posts, the proprietor of the forwarding agency
opened the box for final inspection. A peculiar odor emitted
therefrom and he found dried leaves inside. He brought samples
to NBI, and informed them that the rest of the shipment was still
in his office. Agents of the NBI went to his office and found the
shipment containing bricks of dried marijuana leaves, some of
which were packed inside the gloves and neatly stocked
underneath tabacalera cigars.
Thereafter, an information was filed against the appellant in
violation of RA 6425 (Dangerous Drugs Act), for which he was
found guilty. Appellant assailed the decision, claiming that the
evidence was obtained in violation of his constitutional rights
against unreasonable search and seizure, and further, that the
court erred in admitting in evidence the illegally searched and
seized packages.
2.) Estrada V.
Sandiganbayan
Contention
Petitioner
Appellant contends that the
evidence subject of the
imputed offense had been
obtained in violation of his
constitutional rights against
unreasonable search and
seizure and privacy of
communication (Sec. 2 and 3,
Art. III, Constitution) and
therefore argues that the
same should be held
inadmissible in evidence
RULING
Ruling
Respondent
No. As the Court held in several other cases, the liberties
guaranteed by the Constitution cannot be invoked against
the State in the absence of governmental interference.
This constitutional right (against unreasonable
search and seizure) refers to the immunity of one’s
person, whether citizen or alien, from interference by
government; and the search and seizure clauses are
restraints upon the government and its agents, not
upon private individuals.
In the present case, it was the proprietor of the forwarding
agency who made search/inspection of the packages and
the contraband came into possession of the Government
without the latter transgressing appellant’s rights against
unreasonable search and seizure. The NBI agents made
no search and seizure, much less an illegal one. Thus, the
alleged act of the private individual in violation of a
constitutional right cannot be invoked against the
State.
In sum, the protection against unreasonable searches
and seizures cannot be extended to acts committed
by private individuals so as to bring it within the
ambit of alleged unlawful intrusion by the
government.
The Bill of Rights is a protection against the state
governs the relationship between the individual and
the state. Its concern is not the relation between
individuals, between a private individual and other
individuals. What the Bill of Rights does is to declare some
forbidden zones in the private sphere inaccessible to any
power holder.
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING

Applicability Immediately upon her assumption to office following the successful

EDSA Revolution, then President Corazon C. Aquino issued
Petitioner wants the Court to
take judicial notice that the
The resulting government was indisputably a revolutionary
government bound by no constitution or legal limitations
during Executive Order No. 1 ("EO No. 1") creating the Presidential raiding team conducted the except treaty obligations that the revolutionary government,
Commission on Good Government ("PCGG"). EO No. 1 primarily search and seizure "on March as the de jure government in the Philippines, assumed under
interregnum tasked the PCGG to recover all... ill-gotten wealth of former President 3, 1986 or five days after the international law.
3.) Republic v. Ferdinand E. Marcos, his immediate family, relatives, subordinates
and close associates. Accordingly, the PCGG, through its then
successful EDSA revolution."
We hold that the Bill of Rights under the 1973 Constitution was
Sandiganbayan Chairman Jovito R. Salonga, created an AFP Anti-Graft Board ("AFP Petitioner argues that a not operative during the interregnum. However, we rule that
Board") tasked to investigate reports of... unexplained wealth and revolutionary government was the protection accorded to individuals under the Covenant and
corrupt practices by AFP personnel, whether in the active service or operative at that time... by the Declaration remained in effect during the interregnum.
retired. virtue of Proclamation No. 1 During the interregnum, the directives and orders of the
announcing that President revolutionary government were the supreme law because no
On 27 July 1987, the AFP Board issued a Resolution on its findings Aquino and Vice President constitution limited the extent and scope of such directives
and recommendation on the reported unexplained wealth of Ramas. Laurel were "taking power in and orders. With the abrogation of the 1973 Constitution by
the name and by the will of the the successful revolution, there was no municipal law higher
REVOLUTIONA Evidence in the record showed that respondent is the owner of a Filipino people." than the directives and orders of the revolutionary
house and lot located at 15-Yakan St., La Vista, Quezon City. He is government. Thus, during the interregnum, a person could not
RY also the owner of a house and lot located in Cebu City. The lot has Petitioner asserts that the invoke any exclusionary right under a Bill of Rights because
GOVERNMENT an area of 3,327 square meters. Affidavits of members of the Military revolutionary
Security Unit, Military Security Command, Philippine Army, stationed effectively
government
withheld the
there was neither a constitution nor a Bill of Rights during the
interregnum.
at Camp Eldridge, Los Baños, Laguna, disclosed that Elizabeth operation of... the 1973
Dimaano is the mistress of respondent. Constitution which guaranteed Nevertheless, even during the interregnum the Filipino people
INTERREGNUM private respondents' continued to enjoy, under the Covenant and the Declaration,
Elizabeth Dimaano had no visible means of income and is supported exclusionary right. almost the same rights found in the Bill of Rights of the 1973
by respondent for she was formerly a mere secretary. Taking in toto Constitution. The revolutionary government, after installing
the evidence, Elizabeth Dimaano could not have used the military Petitioner contends that all itself as the de jure government, assumed responsibility for
equipment/items seized in her house on March 3, 1986 without the rights under the Bill of Rights the State’s good faith compliance with the Covenant to which
consent of respondent, he being the Commanding General of the had already reverted to its the Philippines is a signatory. Article 2(1) of the Covenant
Philippine Army. embryonic... stage at the time requires each signatory State “to respect and to ensure to all
of the search. Therefore, the individuals within its territory and subject to its jurisdiction the
It is also impossible for Elizabeth Dimaano to... claim that she owns government may confiscate the rightsrecognized in the present Covenant.” Under Article 17(1)
the P2,870,000.00 and $50,000 US Dollars for she had no visible monies and items taken from of the Covenant, the revolutionary government had the duty to
source of income. Thus, on 1 August 1987, the PCGG filed a petition Dimaano and use the same in insure that “[n]o one shall be subjected to arbitrary or unlawful
for forfeiture under Republic Act No. 1379 ("RA No. 1379") [4] against evidence against her since at interference with his privacy, family, home or
Ramas. the time of their seizure, private correspondence.” The Declaration, to which the Philippines is
respondents did not enjoy any also a signatory, provides in its Article 17(2) that “[n]o one shall
However, the Sandiganbayan dismissed the complaint. There was constitution. be arbitrarily deprived of his property.” Although the
an illegal search and seizure of the items confiscated. The raiding signatories to the Declaration did not intend it as a legally
team seized these items: one baby armalite rifle with two magazines; binding document, being only a declaration, the Court has
40 rounds of 5.56 ammunition; one pistol, caliber .45; interpreted the Declaration as part of the generally accepted
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION
communications equipment, cash consisting of P2,870,000 and
US$50,000, jewelry, and land titles.
DUE PROCESS Ermita-Malate Hotel and Motel Operators Association, and one of its
CONCEPT members Hotel del Mar Inc. petitioned for the prohibition of Ordinance
4670 on June 14, 1963 to be applicable in the city of Manila.
3.) Ermita-Malate Hotel
and Motel Association, They claimed that the ordinance was beyond the powers of the Manila
Inc. v. Mayor of Manila City Board to regulate due to the fact that hotels were not part of its
regulatory powers. They also asserted that Section 1 of the
challenged ordinance was unconstitutional and void for being
unreasonable and violative of due process insofar because it would
impose P6,000.00 license fee per annum for first class motels and
P4,500.00 for second class motels; there was also the requirement
that the guests would fill up a form specifying their personal
information.
There was also a provision that the premises and facilities of such
hotels, motels and lodging houses would be open for inspection from
city authorites. They claimed this to be violative of due process for
being vague.
The law also classified motels into two classes and required the
maintenance of certain minimum facilities in first class motels such as
a telephone in each room, a dining room or, restaurant and laundry.
The petitioners also invoked the lack of due process on this for being
arbitrary.
RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
principles of international law and binding on the State. Thus,
the revolutionary government was also obligated under
international law to observe the rights of individuals under the
Declaration.
The revolutionary government did not repudiate the Covenant
or the Declaration during the interregnum. Whether the
revolutionary government could have repudiated all its
obligations under the Covenant or the Declaration is another
matter and is not the issue here. Suffice it to say that the Court
considers the Declaration as part of customary international
law, and that Filipinos as human beings are proper subjects of
the rules of international law laid down in the Covenant. The
fact is the revolutionary government did not repudiate the
Covenant or the Declaration in the same way it repudiated the
1973 Constitution.
"The presumption is towards the validity of a law.” However,
the Judiciary should not lightly set aside legislative action
when there is not a clear invasion of personal or property
rights under the guise of police regulation. Case was in the
scope of police power. As underlying questions of fact may
condition the constitutionality of legislation of this character,
the resumption of constitutionality must prevail in the absence
of some factual foundation of record for overthrowing the
statute."
No such factual foundation being laid in the present case, the
lower court deciding the matter on the pleadings and the
stipulation of facts, the presumption of validity must prevail
and the judgment against the ordinance set aside.” There is
no question but that the challenged ordinance was precisely
enacted to minimize certain practices hurtful to public morals,
particularly fornication and prostitution. Moreover, the
increase in the licensed fees was intended to discourage
"establishments of the kind from operating for purpose other
than legal" and at the same time, to increase "the income of
the city government." Police power is the power to prescribe
regulations to promote the health, morals, peace, good order,
safety and general welfare of the people. In view of the
requirements of due process, equal protection and other
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
It was also unlawful for the owner to lease any room or portion thereof applicable constitutional guaranties, however, the power must
more than twice every 24 hours. not be unreasonable or violative of due process

There was also a prohibition for persons below 18 in the hotel. There is no controlling and precise definition of due process.
It furnishes though a standard to which governmental action
The challenged ordinance also caused the automatic cancellation of should conform in order that deprivation of life, liberty or
the license of the hotels that violated the ordinance. property, in each appropriate case, be valid. The standard of
The lower court declared the ordinance unconstitutional. due process which must exist both as a procedural and as
Hence, this appeal by the city of Manila. substantive requisite to free the challenged ordinance, or any
governmental action for that matter, from imputation of legal
infirmity, is responsiveness to the supremacy of reason.
obedience to the dictates of justice. It would be an affront to
reason to stigmatize an ordinance enacted precisely to meet
what a municipal lawmaking body considers an evil of rather
serious pro portions as an arbitrary and capricious exercise of
authority. What should be deemed unreasonable and what
would amount to an abdication of the power to govern is
inaction in the face of an admitted deterioration of the state of
public morals.

Due process is not a narrow or "technical conception with fixed

content unrelated to time, place and circumstances,"
decisions based on such a clause requiring a "close and
perceptive inquiry into fundamental principles of our society."
Questions of due process are not to be treated narrowly or
pedantically in slavery to form or phrase. Nothing in the
petition is sufficient to prove the ordinance’s nullity for an
alleged failure to meet the due process requirement.

Saunar v. Executive Saunar was a former Regional Director of the National BureauSaunar bewails that he was In our jurisdiction, the constitutional guarantee of due
of Investigation (NBI), which he joined as an agent in 1988.deprived of due process, process is also not limited to an exact definition. It is
Secretary Saunar conducted an official investigation regarding the alleged
pointing out that no real flexible in that it depends on the circumstances and
corruption relative to the tobacco excise taxes and involving
hearing was ever conducted varies with the subject matter and the necessities of the
then Governor Luis "Chavit" Singson, former President Josephconsidering that the
situation.
E. Estrada (President Estrada), and former Senator Jinggoy clarificatory conference
Estrada. conducted by the PAGC was
a sham.
Saunar was reassigned as regional director for Western In addition, he asserts that
Mindanao based in Zamboanga City. During his stint as such, he was not notified of the
TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION
he received a subpoena ad testificandum from the
Sandiganbayan requiring him to testify in the plunder case
against President Estrada. After securing approval from his
immediate supervisor Filomeno Bautista (Bautista), Deputy
Director for Regional Operation Services (DDROS), Saunar
appeared before the Sandiganbayan on several hearing dates.
NBI Director Reynaldo Wycoco (Wycoco) issued Special Order
No. 005033[7] informing Saunar that he was relieved from his
duties as regional director for Western Mindanao and was
ordered to report to the DDROS for further instructions.
, Saunar received an order from the Presidential Anti-Graft
Commission (PAGC) requiring him to answer the allegations
against him in the PAGC Formal Charge dated 3 October
2006. The charge was based on a letter, dated 19 August
2005, from Wycoco recommending an immediate appropriate
action against Saunar for his failure to report for work since 24
March 2005, without approved leave of absence for four (4)
months.[9]
On 23 October 2006, Saunar was reassigned as regional
director of the Bicol Regional Office. On 29 January 2007, he
received a copy of the OP decision dismissing him from service.
RULING
charges against him Cardinal requirements of due process in
because he was only made administrative proceedings (1994 Bar)
aware of the allegations after
the PAGC had formally 1. Right to a hearing which includes the right to
charged him present one’s case and submit evidence in
support thereof;
2. The tribunal must consider the evidence
presented;
3. The decision must be supported by evidence;
4. Such evidence must be substantial;
5. The decision must be rendered on the evidence
presented at the hearing or at least contained
in the record, and disclosed to the parties
affected;
6. The tribunal or body or any of its judges must
act on its own independent consideration of the
law and facts of the controversy in arriving at a
decision;
7. The board or body should render decision in
such a manner that parties can know the
various issues involved and the reasons for the
decision rendered
The PAGC violated Saunar's right to due process
because it failed to observe fairness in handling the
case against him. Its unfairness and unreasonableness
is readily apparent with its disregard of its own rules of
procedure.
To reiterate, due process is a malleable concept
anchored on fairness and equity. The due process
requirement before administrative bodies are not as
strict compared to judicial tribunals in that it suffices that
a party is given a reasonable opportunity to be heard.
Nevertheless, such "reasonable opportunity" should not
be confined to the mere submission of position papers
and/or affidavits and the parties must be given the
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION
The petitioner in this case, the suspended municipal president of
Pasay, Rizal, seeks by these proceedings in mandamus to have the
provincial governor and the provincial board of the Province of Rizal
temporarily restrained from going ahead with investigation of the
Cornejo v. charges filed against him pending resolution of the case, and to have
Gabriel an order issue directed to the provincial governor commanding him to
return the petitioner to his position as municipal president of Pasay.
The members of the provincial board have interposed a demurrer
based on the ground that this. court has no right to keep them from
complying with the provisions of the law.
The provincial governor has filed an answer to the petition, in which
he alleges as a special defense that numerous complaints have been
received by him against the conduct of Miguel R. Cornejo, municipal
president of Pasay; that these complaints were investigated by him;
that he came to the conclusion that agreeable to the powers conferred
upon provincial governors, the municipal president should be
Counsel for petitioner has
argued, with much eloquence,
that his client has been
deprived of an office, to which
he was elected by popular vote,
without having an opportunity
to be heard in his own defense.
RULING
opportunity to examine the witnesses against them. The
right to a hearing is a right which may be invoked by the
parties to thresh out substantial factual issues. It
becomes even more imperative when the rules itself of
the administrative body provides for one. While the
absence of a formal hearing does not necessarily result
in the deprivation of due process, it should be
acceptable only when the party does not invoke the
said right or waives the same.
The Court finds that Saunar was not treated fairly in the
proceedings before the PAGC. He was deprived of the
opportunity to appear in all clarificatory hearings since
he was not notified of the clarificatory hearing attended
by an NBI official. Saunar was thus denied the chance
to propound questions through the PAGC against the
opposing parties, when the rules of the PAGC itself
granted Saunar the right to be present during
clarificatory hearings and the chance to ask questions
against the opposing party
The respondents Under the title of "Provincial supervision over municipal
reply that all that officers," Article IV of Chapter 57 of the Administrative Code,
the provincial
governor and the With the foregoing legal provisions in mind, certain aspects of
provincial board the case can be disposed of without difficulty. Thus it cannot
have done in this be seriously contended that the courts should interfere with an
case is to orderly investigation which is about to be conducted by the
comply with the provincial board. Nor can there be any doubt as to the
requirements of meaning of the law. A very minute and extensive procedure is
the law which provided by the Legislature for central and provincial
they are sworn supervision of municipal officers. The provincial governor, in
to enforce receiving and investigating complaints against such officers,
may take three courses. For a minor delinquency he may
reprimand the offender; but if the maladministration in office is
more serious he may temporarily suspend the officer, and
thereafter may file written charges against the officer with the
provincial board. The procedure followed before the provincial
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION
temporarily suspended, and that an investigation is now being
conducted by the provincial board.
Petitioners Isidro T. Hildawa and Ricardo C. Valmonte in these
Special Civil Actionspray that a "preliminary injunction issue directing
respondents to recall the crimebusters andrestraining them from
fielding police teams or any of this sort with authority/license to kill
HILDAWA V. andafter hearing, declaring the order of respondents fielding
MINISTRY OF crimebusters null and void andmaking the injunction permanent."
They alleged that the formation and fielding of secretmarshals and/or
DEFENSE crimebusters with absolute authority to kill thieves, holduppers,
robbers,pickpockets and slashers are violative of the provisions of the
New Constitution under Sections 1, 17,19, 20 and 21 of Article III (Bill
of Rights)
RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
board and later on appeal to the Chief of the Executive
Bureau, while interesting, does not concern us. The important
fact is that the law, in permitting a provincial governor
temporarily to suspend a municipal officer, makes no mention
of a formal hearing of the charges.
Not only this, but the law before us expedites the proceedings
by fixing a short period of ten days within which the provincial
governor must lay the charges before the provincial board,
which must be heard by the latter body within fifteen days. Of
more compelling force is the suggestion from the other side
that the public interest might suffer detriment by postponing
the temporary suspension until after the hearing. Our holding,
after most thoughtful consideration, is that the provisions of
section 2188 of the Administrative Code are clear and that
they do not offend the due process of law clause of the
Philippine Bill of Rights. Accordingly, it is our duty to apply the
law without fear or favor.
The Supreme held that there is nothing wrong in the creation
and deployment of special operation teams to counter the
resurgence of criminality, as there is nothing wrong inthe
formation by the police of special teams/squads to prevent the
proliferation of vices,prostitution, drug addiction, pornography
and the like. That is the basic job of the police. It isthe alleged
use of violence in the implementation of the objectives of the
special squads thatthe court is concerned about. It is our way
of life that a man is entitled to due process whichsimply means
that before he can be deprived of his life, liberty or property,
he must be givenan opportunity to defend himself. Due
process of law requires that the accused must beheard in
court of competent jurisdiction, proceeded against under the
orderly process of law,and only punished after inquiry and
investigation, upon notice to him, with an opportunity tobe
heard, and a judgment awarded within the authority of a
constitutional law
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION
The petitioners contend that the RH Law suffers from vagueness and,
thus violates the due process clause of the Constitution. According to
them, Section 23 (a)(l) mentions a "private health service provider"
among those who may be held punishable but does not define who is
a "private health care service provider." They argue that confusion
further results since Section 7 only makes reference to a "private
health care institution."
IMBONG V.
The petitioners also point out that Section 7 of the assailed legislation
OCHOA exempts hospitals operated by religious groups from rendering
reproductive health service and modern family planning methods. It
is unclear, however, if these institutions are also exempt from giving
reproductive health information under Section 23(a)(l), or from
rendering reproductive health procedures under Section 23(a)(2).
Finally, it is averred that the RH Law punishes the withholding,
restricting and providing of incorrect information, but at the same time
fails to define "incorrect information."
The RH Law is "void-for-
vagueness" in violation of the
due process clause of the
Constitution. In imposing the
penalty of imprisonment and/or
fine for "any violation," it is
vague because it does not
define the type of conduct to be
treated as "violation" of the RH
Law. In this connection, it is
claimed that "Section 7 of the
RH Law violates the right to
due process by removing from
them (the people) the right to
manage their own affairs and to
decide what kind of health
facility they shall be and what
kind of services they shall
offer."47 It ignores the
management prerogative
inherent in corporations for
employers to conduct their
affairs in accordance with their
own discretion and judgment.
RULING
The arguments fail to persuade. A statute or act suffers from
the defect of vagueness when it lacks comprehensible
standards that men of common intelligence must necessarily
guess its meaning and differ as to its application. It is
repugnant to the Constitution in two respects: (1) it violates
due process for failure to accord persons, especially the
parties targeted by it, fair notice of the conduct to avoid; and
(2) it leaves law enforcers unbridled discretion in carrying out
its provisions and becomes an arbitrary flexing of the
Government muscle.255 Moreover, in determining whether
the words used in a statute are vague, words must not only be
taken in accordance with their plain meaning alone, but also
in relation to other parts of the statute. It is a rule that every
part of the statute must be interpreted with reference to the
context, that is, every part of it must be construed together
with the other parts and kept subservient to the general intent
of the whole enactment.256
As correctly noted by the OSG, in determining the definition of
"private health care service provider," reference must be
made to Section 4(n) of the RH Law which defines a "public
health service provider," viz: (n) Public health care service
provider refers to: (1) public health care institution, which is
duly licensed and accredited and devoted primarily to the
maintenance and operation of facilities for health promotion,
disease prevention, diagnosis, treatment and care of
individuals suffering from illness, disease, injury, disability or
deformity, or in need of obstetrical or other medical and
nursing care; (2) public health care professional, who is a
doctor of medicine, a nurse or a midvvife; (3) public health
worker engaged in the delivery of health care services; or (4)
barangay health worker who has undergone training programs
under any accredited government and NGO and who
voluntarily renders primarily health care services in the
community after having been accredited to function as such
TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
by the local health board in accordance with the guidelines
promulgated by the Department of Health (DOH) . Further, the
use of the term "private health care institution" in Section 7 of
the law, instead of "private health care service provider,"
should not be a cause of confusion for the obvious reason that
they are used synonymously.

The Court need not belabor the issue of whether the right to
be exempt from being obligated to render reproductive health
service and modem family planning methods, includes
exemption from being obligated to give reproductive health
information and to render reproductive health procedures.
Clearly, subject to the qualifications and exemptions earlier
discussed, the right to be exempt from being obligated to
render reproductive health service and modem family
planning methods, necessarily includes exemption from being
obligated to give reproductive health information and to render
reproductive health procedures. The terms "service" and
"methods" are broad enough to include the providing of
information and the rendering of medical procedures. The
same can be said with respect to the contention that the RH
Law punishes health care service providers who intentionally
withhold, restrict and provide incorrect information regarding
reproductive health programs and services.

For ready reference, the assailed provision is hereby quoted

as follows: SEC. 23. Prohibited Acts. - The following acts are
prohibited: (a) Any health care service provider, whether
public or private, who shall: (1) Knowingly withhold information
or restrict the dissemination thereof, and/ or intentionally
provide incorrect information regarding programs and
services on reproductive health including the right to informed
choice and access to a full range of legal, medically-safe, non-
abortifacient and effective family planning methods; From its
plain meaning, the word "incorrect" here denotes failing to
agree with a copy or model or with established rules;
inaccurate, faulty; failing to agree with the requirements of
duty, morality or propriety; and failing to coincide with the truth.
257 On the other hand, the word "knowingly" means with
awareness or deliberateness that is intentional.258 Used
together in relation to Section 23(a)(l), they connote a sense
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
of malice and ill motive to mislead or misrepresent the public
as to the nature and effect of programs and services on
reproductive health.

Public health and safety demand that health care service

providers give their honest and correct medical information in
accordance with what is acceptable in medical practice. While
health care service providers are not barred from expressing
their own personal opinions regarding the programs and
services on reproductive health, their right must be tempered
with the need to provide public health and safety. The public
deserves no less.
Assailed is the government's power to control deployment of female A profession, trade or calling is a property right within the
entertainers to Japan by requiring an Artist Record Book (ARB) as a meaning of our constitutional guarantees. One cannot be
precondition to the processing by the POEA of any contract for deprived of the right to work and the right to make a living
overseas employment. By contending that the right to overseas because these rights are property rights, the arbitrary and
employment, is a property right within the meaning of the Constitution, unwarranted deprivation of which normally constitutes an
petitioners vigorously aver that deprivation thereof allegedly through actionable wrong.12 Nevertheless, no right is absolute, and
the onerous requirement of an ARB violates the due process clause the proper regulation of a profession, calling, business or trade
and constitutes an invalid exercise of the police power. Following the has always been upheld as a legitimate subject of a valid
much-publicized death of Maricris Sioson in 1991, former President exercise of the police power by the state particularly when
Corazon C. Aquino ordered a total ban against the deployment of their conduct affects either the execution of legitimate
JMM performing artists to Japan and other foreign destinations. The ban
was, however, rescinded after leaders of the overseas employment
governmental functions, the preservation of the State, the
public health and welfare and public morals.
PRODUCTIONS industry promised to extend full support for a program aimed at
removing kinks in the system of deployment. In its place, the According to the maxim, sic utere tuo ut alienum non laedas,
government, through the Secretary of Labor and Employment, it must of course be within the legitimate range of legislative
subsequently issued Department Order No. 28, creating the action to define the mode and manner in which every one may
Entertainment Industry Advisory Council (EIAC), which was tasked so use his own property so as not to pose injury to himself or
with issuing guidelines on the training, testing certification and others.13 In any case, where the liberty curtailed affects at
deployment of performing artists abroad. most the rights of property, the permissible scope of regulatory
measures is certainly much wider.14 To pretend that licensing
The Federation of Entertainment Talent Managers of the Philippines or accreditation requirements violates the due process clause
(FETMOP), on January 27, 1995 filed a class suit assailing these is to ignore the settled practice, under the mantle of the police
department orders, principally contending that said orders 1) violated power, of regulating entry to the practice of various trades or
the constitutional right to travel; 2) abridged existing contracts for professions.
employment; and 3) deprived individual artists of their licenses
without due process of law. FETMOP, likewise, averred that the Professionals leaving for abroad are required to pass rigid
issuance of the Artist Record Book (ARB) was discriminatory and written and practical exams before they are deemed fit to
illegal and "in gross violation of the constitutional right... to life liberty practice their trade. Seamen are required to take tests
determining their seamanship. Locally, the Professional
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION
and property." Said Federation consequently prayed for the issuance
of a writ of preliminary injunction against the aforestated orders.
On February 2, 1992, JMM Promotion and Management, Inc.
and Kary International, Inc., herein petitioners, filed a Motion for
Intervention in said civil case, which was granted by the trial court in
an Order dated 15 February, 1995.
However, on February 21, 1995, the trial court issued an order
denying petitioner's prayer for writ of preliminary injunction and
dismissed the compliant. An appeal was made to the trial court
regarding its decision but it was also however, dismissed. As a
consequences, ARB requirement was issed. The Court of Appeals
upheld the trial court's decision and concluded that the
said issuance constituted a valid exercise of Police power.
Private respondent Muñoz was charged before Hong Kong Court.
Warrants of arrest were issued and by virtue of a final decree the
HONGKONG V validity of the Order of Arrest was upheld. The petitioner Hong Kong
Administrative Region filed a petition for the extradition of the private or excess of jurisdiction in
OLALIA respondent. In the same case, a petition for bail was filed by the
private respondent. The petition for bail was denied by reason that
there was no Philippine law granting the same in extradition cases
and that the respondent was a high “flight risk”.
Private respondent filed a motion for reconsideration and was criminal proceedings
granted by the respondent judge subject to the following conditions:
1. Bail is set at Php750,000.00 in cash with the condition that accused
hereby undertakes that he will appear and answer the issues raised
in these proceedings and will at all times hold himself amenable to
orders and processes of this Court, will further appear for judgment.
If accused fails in this undertaking, the cash bond will be forfeited in
favor of the government; 2. Accused must surrender his valid
passport to this Court; 3. The Department of Justice is given
immediate notice and discretion of filing its own motion for hold
departure order before this Court even in extradition proceeding; and
4. Accused is required to report to the government prosecutors
handling this case or if they so desire to the nearest office, at any time
and day of the week; and if they further desire, manifest before this
Court to require that all the assets of accused, real and personal, be
filed with this Court soonest, with the condition that if the accused
RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION
Petitioner alleged that the trial
court committed grave abuse
of discretion amounting to lack
admitting private respondent to
bail; that there is nothing in the
Constitution or statutory law
providing that a potential
extraditee has a right to bail,
the right being limited solely to
RULING
Regulation Commission has begun to require previously
licensed doctors and other professionals to furnish
documentary proof that they had either retrained or had
undertaken continuing education courses as a requirement for
renewal of their licenses. It is not claimed that these
requirements pose an unwarranted deprivation of a property
right under the due process clause. So long as professionals
and other workers meet reasonable regulatory standards no
such deprivation exists
In his comment In this case, the Court reviewed what was held in Government
on the petition, of United States of America v. Hon. Guillermo G. Purganan,
private Presiding Judge, RTC of Manila, Branch 42, and Mark B.
respondent Jimenez, a.k.a. Mario Batacan Crespo GR No. 153675 April
maintained that 2007, that the constitutional provision on bail does not apply
the right to bail to extradition proceedings, the same being available only in
guaranteed criminal proceedings.
under the Bill of
Rights extends The Court took cognizance of the following trends in
to a prospective international law: (1) the growing importance of the individual
extraditee; and person in public international; (2) the higher value now being
that extradition is given to human rights; (3) the corresponding duty of countries
a harsh process to observe these universal human rights in fulfilling their treaty
resulting in a obligations; and (4) the duty of this Court to balance the rights
prolonged of the individual under our fundamental law, on one hand, and
deprivation of the law on extradition, on the other. In light of the recent
one’s liberty. developments in international law, where emphasis is given to
the worth of the individual and the sanctity of human rights,
the Court departed from the ruling in Purganan, and held that
an extraditee may be allowed to post bail.
Thus, on December 10, 1948, the United Nations General
Assembly adopted the Universal Declaration of Human Rights
in which the right to life, liberty and all the other fundamental
rights of every person were proclaimed. While not a treaty, the
principles contained in the said Declaration are now
TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION
flees from his undertaking, said assets be forfeited in favor of the
government and that the corresponding lien/annotation be noted
therein accordingly. Petitioner filed a motion to vacate the said order
but was denied by the respondent judge. Hence, this instant petition.
on February 26, 1964 when the Deputy Sheriff of Quezon City served
upon petitioner copy of an alias writ of execution, she learned for the
first time that a decision was rendered in a certain Civil Case No. Q-
5866 with respondent spouses, plaintiffs therein, being the prevailing
parties against the People’s Homesite and Housing Corporation.
it is petitioner’s contention that she could not be bound by the
judgment and that the refusal to lift the alias writ of execution and the
order of demolition, without hearing the matter as alleged in said
petition and without receiving any evidence and her ejectment from
RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
recognized as customarily binding upon the members of the
international community. Thus, in Mejoff v. Director of
Prisons,2 this Court, in granting bail to a prospective deportee,
held that under the Constitution,3 the principles set forth in
that Declaration are part of the law of the land. In 1966, the
UN General Assembly also adopted the International
Covenant on Civil and Political Rights which the Philippines
signed and ratified. Fundamental among the rights enshrined
therein are the rights of every person to life, liberty, and due
process. The Philippines, along with the other members of the
family of nations, committed to uphold the fundamental human
rights as well as value the worth and dignity of every person.
This commitment is enshrined in Section II, Article II of our
Constitution which provides: "The State values the dignity of
every human person and guarantees full respect for human
rights." The Philippines, therefore, has the responsibility of
protecting and promoting the right of every person to liberty
and due process, ensuring that those detained or arrested can
participate in the proceedings before a court, to enable it to
decide without delay on the legality of the detention and order
their release if justified. In other words, the Philippine
authorities are under obligation to make available to every
person under detention such remedies which safeguard their
fundamental right to liberty. These remedies include the right
to be admitted to bail. While this Court in Purganan limited the
exercise of the right to bail to criminal proceedings, however,
in light of the various international treaties giving recognition
and protection to human rights, particularly the right to life and
liberty, a reexamination of this Court’s ruling in Purganan is in
order
She then reiterated that the petitioner Makabingkil was at no time named a party and could
decision in Civil Case No. Q- not therefore be heard on a matter wherein her vital rights
5866 could not in any way bind were undoubtedly involved. From the above recital of
her for not being a party in such undisputed facts, the picture clearly emerges. Petitioner was
a case and that to allow indeed denied due process.
respondent spouses to take
possession of the lot in It contemplates notice and opportunity to be heard before
question and remove judgment is rendered affecting one's person or property.
petitioner’s house and other
improvements legally due process “contemplates notice and opportunity to be heard
constructed thereon by virtue before judgment is rendered, affecting one’s person or
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
the lot in question of which she was in actual possession “would of such order of demolition property.” It is satisfied according to another leading decision:
constitute a deprivation of property rights without due process of law.” dated April 18, 1964, would not “If the following conditions are present, namely: (1) There
only cause great and must be a court or tribunal clothed with judicial power to hear
irreparable injury, but would and determine the matter before it; (2) jurisdiction must be
also cause injustice to her by lawfully acquired over the person of the defendant or over the
depriving her of her property property which is the subject of the proceeding; (3) the
without due process of law. defendant must be given an opportunity to be heard; and (4)
judgment must be rendered upon lawful hearing.”

B. SCOPE Smith, Bell & Co., (Ltd.), is a corporation organized and existing under
the laws of the Philippine Islands. A majority of its stockholders are
Yes. We are inclined to the view that while Smith, Bell & Co.
Ltd., a corporation having alien stockholders, is entitled
SMITH BELL CO British subjects. It is the owner of a motor vessel known as to the protection afforded by the due-process of law and
the Bato built for it in the Philippine Islands in 1916, of more than equal protection of the laws clause of the Philippine Bill
V. NATIVIDAD fifteen tons gross The Bato was brought to Cebu in the present year of Rights, nevertheless, Act No. 2761 of the Philippine
for the purpose of transporting plaintiff's merchandise between ports Legislature, in denying to corporations such as Smith,
in the Islands. Application (Certificate of Philippine Regitry) was made Bell &. Co. Ltd., the right to register vessels in the
at Cebu, the home port of the vessel, to the Collector of Customs for Philippines coastwise trade, does not belong to that
a certificate of Philippine registry. The Collector refused to issue the vicious species of class legislation which must always be
certificate, giving as his reason that all the stockholders of Smith, Bell condemned, but does fall within authorized exceptions,
& Co., Ltd., were not citizens either of the United States or of the notably, within the purview of the police power, and so
Philippine Islands under Act No. 2761 which provides: does not offend against the constitutional provision.
SEC. 1172. Certificate of Philippine register. — Upon
registration of a vessel of domestic ownership, and of more than The guaranties of the Fourteenth Amendment and so
fifteen tons gross, a certificate of Philippine register shall be issued of the first paragraph of the Philippine Bill of Rights, are
for it. If the vessel is of domestic ownership and of fifteen tons gross universal in their application to all person within the territorial
or less, the taking of the certificate of Philippine register shall be jurisdiction, without regard to any differences of race, color, or
optional with the owner. nationality. The word "person" includes aliens. Private
SEC. 1176. Investigation into character of vessel. — No corporations, likewise, are "persons" within the scope of the
application for a certificate of Philippine register shall be guaranties in so far as their property is concerned.
approved until the collector of customs is satisfied from an Classification with the end in view of providing diversity
inspection of the vessel that it is engaged or destined to be of treatment may be made among corporations, but must
engaged in legitimate trade and that it is of domestic ownership be based upon some reasonable ground and not be a
as such ownership is defined in section eleven hundred and seventy- mere arbitrary selection.
two of this Code.
Counsel says that Act No. 2761 denies to Smith, Bell & Co., A literal application of general principles to the facts
Ltd., the equal protection of the laws because it, in effect, prohibits before us would, of course, cause the inevitable deduction that
the corporation from owning vessels, and because classification of Act No. 2761 is unconstitutional by reason of its denial to a
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION
corporations based on the citizenship of one or more of their
stockholders is capricious, and that Act No. 2761 deprives the
corporation of its properly without due process of law because by the
passage of the law company was automatically deprived of every
beneficial attribute of ownership in the Bato and left with the naked
title to a boat it could not use.
This case involves an ordinance prohibiting aliens from being
Villegas v. employed or engage or participate in any position or occupation or
Hiu Chiong, business enumerated therein, whether permanent, temporary or
casual, without first securing an employment permit from the Mayor
of Manila and paying the permit fee of P50.00. Private respondent Hiu
RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION
It is arbitrary, oppressive and
unreasonable, being applied
only to aliens who are thus,
deprived of their rights to life,
liberty and property and
RULING
corporation, some of whole members are foreigners, of the
equal protection of the laws.
To justify that portion of Act no. 2761 which permits
corporations or companies to obtain a certificate of Philippine
registry only on condition that they be composed wholly of
citizens of the Philippine Islands or of the United States or
both, as not infringing Philippine Organic Law, it must be done
under some one of the exceptions.
One of the exceptions to the general rule, most
persistent and far reaching in influence is, broad and
comprehensive as it is, nor any other amendment, "was
designed to interfere with the power of the State, sometimes
termed its `police power,' to prescribe regulations to promote
the health, peace, morals, education, and good order of the
people, and legislate so as to increase the industries of the
State, develop its resources and add to its wealth and
prosperity. From the very necessities of society, legislation of
a special character, having these objects in view, must often
be had in certain districts. This is the same police power which
the United States Supreme Court say "extends to so dealing
with the conditions which exist in the state as to bring out of
them the greatest welfare in of its people." For quite similar
reasons, none of the provision of the Philippine Organic Law
could could have had the effect of denying to the Government
of the Philippine Islands, acting through its Legislature, the
right to exercise that most essential, insistent, and illimitable
of powers, the sovereign police power, in the promotion of the
general welfare and the public interest.
Without any subterfuge, the apparent purpose of the
Philippine Legislature is seen to be to enact an anti-alien
shipping act. The ultimate purpose of the Legislature is to
encourage Philippine ship-building.
A city ordinance which requires aliens to secure a mayor’s
permit before they can earn a means of livelihood in the City
of Manila is void and unconstitutional.—Requiring a person
before he can be employed to get a permit from the City Mayor
of Manila who may withhold or refuse it at will is tantamount to
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
Chiong Tsai Pao Ho who was employed in Manila, filed a petition to therefore, violates the due denying him the basic right of the people in the Philippines to
stop the enforcement of such ordinance as well as to declare the process and equal protection engage in a means of livelihood. While it is true that the
same null and void. Trial court rendered judgment in favor of the clauses of the Constitution. Philippines as a State is not obliged to admit aliens within its
petitioner, hence this case. territory, once an alien is admitted, he cannot be deprived of
life without due process of law. This guarantee includes the
means of livelihood. The shelter of protection under the due
process and equal protection clause is given to all persons,
both aliens and citizens.

The ordinance is unconstitutional. While it is true that the

Philippines as a State is not obliged to admit aliens within its
territory, once an alien is admitted, he cannot be deprived of life
without due process of law. This guarantee includes the means of
livelihood. The ordinance amounts to a denial of the basic right of
the people of the Philippines to engage in the means of livelihood
C. SUBSTANTIVE Secretary Of Justice Franklin Drilon, representing the Government of The evaluation process, just like the extradition
the Republic of the Philippines, signed in Manila the “extradition proceedings proper, belongs to a class by itself. It is sui
AND Treaty Between the Government of the Philippines and the generis. It is not a criminal investigation, but it is also
PROCEDURAL Government of the U.S.A. The Philippine Senate ratified the said erroneous to say that it is purely an exercise of ministerial
Treaty. On June 18, 1999, the Department of Justice received from functions. At such stage, the executive authority has the
DUE PROCESS the Department of Foreign Affairs U.S Note Verbale No. 0522
power: (a) to make a technical assessment of the
containing a request for the extradition of private respondent Mark
Jiminez to the United States. On the same day petitioner designate completeness and sufficiency of the extradition papers;
13. Secretary of and authorizing a panel of attorneys to take charge of and to handle (b) to outrightly deny the request if on its face and on the
Justice v. Lantion the case. Pending evaluation of the aforestated extradition face of the supporting documents the crimes indicated
documents, Mark Jiminez through counsel, wrote a letter to Justice are not extraditable; and (c) to make a determination
Secretary requesting copies of the official extradition request from the whether or not the request is politically motivated, or that
U.S Government and that he be given ample time to comment on the the offense is a military one which is not punishable
request after he shall have received copies of the requested papers under non-military penal legislation (tsn, August 31,
but the petitioner denied the request for the consistency of Article 7 of 1999, pp. 28-29; Article 2 and Paragraph [3], Article 3,
the RP-US Extradition Treaty stated in Article 7 that the Philippine RP-US Extradition Treaty). Hence, said process may be
Government must present the interests of the United States in any characterized as an investigative or inquisitorial process
proceedings arising out of a request for extradition.
in contrast to a proceeding conducted in the exercise of
an administrative body’s quasijudicial power.

The doctrine of incorporation is applied whenever

municipal tribunals are confronted with situations in
which there appears to be a conflict between a rule of
international law and the provisions of the constitution or
TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
statute of a local state. Efforts should be done to
harmonize them. In a situation, however, where the
conflict is irreconcilable and a choice has to be made
between a rule of international law and municipal law,
jurisprudence dictates that municipal law should be
upheld by the municipal courts. The doctrine of
incorporation decrees that rules of international law are
given equal standing, but are not superior to, national
legislative enactments.

Private respondent is bereft of the right to notice and

KINDS OF DUE PROCESS hearing during the evaluation stage of the extradition
process. An extradition proceeding is sui generis. It is not
a criminal proceeding which will call into operation all the
The constitutional right to due process secures to
rights of an accused as guaranteed by the Bill of Rights.
everyone an opportunity to be heard, presupposing The process of extradition does not involve the
foreknowledge of what he may be up against, and to determination of the guilt or innocence of an accused.
submit any evidence that he may wish to proffer in an His guilt or innocence will be adjudged in the court of the
effort to clear himself. state where he will be extradited. Hence, as a rule,
constitutional rights that are only relevant to determine
the guilt or innocence of an accused cannot be invoked
Substantive due process looks into the extrinsic by an extraditee especially by one whose extradition
and intrinsic validity of the law that figures to papers are still undergoing evaluation. As held by the US
interfere with the right of a person to his life, Supreme Court in United States v. Galanis: “An
extradition proceeding is not a criminal prosecution, and
liberty and property. the constitutional safeguards that accompany a criminal
trial in this country do not shield an accused from
Procedural due process—the more litigated of extradition pursuant to a valid treaty.” As an extradition
proceeding is not criminal in character and the evaluation
the two—focuses on the rules that are stage in an extradition proceeding is not akin to a
established in order to ensure meaningful preliminary investigation, the due process safeguards in
adjudication in the enforcement and the latter do not necessarily apply to the former. The
procedural due process required by a given set of
implementation of the law circumstances “must begin with a determination of the
precise nature of the government function involved as
well as the private interest that has been affected by
governmental action.” The concept of due process is
flexible for “not all situations calling for procedural
TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
safeguards call for the same kind of procedure.” In tilting
the balance in favor of the interests of the State, the
Court stresses that it is not ruling that the private
respondent has no right to due process at all throughout
the length and breadth of the extrajudicial proceedings.
Procedural due process requires a determination of what
process is due, when it is due, and the degree of what is
due. Stated otherwise, a prior determination should be
made as to whether procedural protections are at all due
and when they are due, which in turn depends on the
extent to which an individual will be “condemned to suffer
grievous loss.”

As aforesaid, P.D. No. 1069 which implements the RP-

US Extradition Treaty affords an extraditee sufficient
opportunity to meet the evidence against him once the
petition is filed in court. The time for the extraditee to
know the basis of the request for his extradition is merely
moved to the filing in court of the formal petition for
extradition. The extraditee’s right to know is momentarily
withheld during the evaluation stage of the extradition
process to accommodate the more compelling interest of
the State to prevent escape of potential extraditees
which can be precipitated by premature information of
the basis of the request for his extradition. No less
compelling at that stage of the extradition proceedings is
the need to be more deferential to the judgment of a co-
equal branch of the government, the Executive, which
has been endowed by our Constitution with greater
power over matters involving our foreign relations.
Needless to state, this balance of interests is not a static
but a moving balance which can be adjusted as the
extradition process moves from the administrative stage
to the judicial stage and to the execution stage
depending on factors that will come into play. In sum, we
rule that the temporary hold on private respondent’s
privilege of notice and hearing is a soft restraint on his
right to due process which will not deprive him of
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
fundamental fairness should he decide to resist the
request for his extradition to the United States. There is
no denial of due process as long as fundamental fairness
is assured a party.
1.
Social
Justice
Society v.
Atienza
Lawrence and Garner were engaging in sexual activity when an Lawrence petitioned the United The Court in Bowers v. Hardwick, 478 U.S. 168 (1986), upheld
officer entered the home of Lawrence in response to a reported States Supreme Court, a statute in Georgia which prohibited consensual, private,
weapons disturbance. The officer arrested both Lawrence and Garner claiming that statute was sodomy amongst both hetero and homosexuals. The Bower’s
and held each in overnight custody. The two men were later charged unconstitutional and violated Court incorrectly framed the issue as whether homosexuals
LAWRENCE VS in Texas by a Justice of the Peace. his 14th Amendment rights have a right to engage in sexual activity under the
TEXAS Constitution. This Court held that a ruling stating the right is
not protected, would essentially have the same consequence
as determining whether or not homosexual relationships, in
general, are lawful. This determination would intrude on the
HOMOSEXUAL fundamental right of homosexuals to participate in familial
relationships as well as intimate and personal relationships.

This Court held there is no historical precedent in America of

laws directed at prohibiting distinct homosexual conduct. In
addition, enforcing legal punish for consensual conduct would
be very difficult. The Bower’s Court was largely overstated
when it relied on historical traditions in prohibiting homosexual
activity and was likely based on religious and moral
preferences of each Justice. This Court noted that many
states that have laws in place prohibiting homosexual conduct
do not prosecute those who engage. The result is likely a
reflection of the increasing social and legal acceptance of the
right to privacy of consenting adults and homosexuals. The
Court cites Planned Parenthood v. Casey, 505 U.S. 833
(1992) as authority stating evidence of this tendency. The
Court held that the rights of consenting adults to engage in
homosexual activity is protected under the liberty interest of
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
the substantive due process clause. Here, the sexual activity
in question is protected by the Due Process Clause and
Bowers is unconstitutional and overturned.
WHITE LIGHT On December 3, 1992, City Mayor Alfredo S. Lim signed into law
Manila City Ordinance No. 7774 entitled “An Ordinance
The primary constitutional question that confronts us is one of
due process, as guaranteed under Section 1, Article III of the
CORPORATION Prohibiting Short-Time Admission, Short-Time Admission Rates, Constitution. Due process evades a precise definition.48 The
and Wash-Up Rate Schemes in Hotels, Motels, Inns, Lodging purpose of the guaranty is to prevent arbitrary governmental
V. CITY OF Houses, Pension Houses, and Similar Establishments in the City encroachment against the life, liberty and property of
MANLA of Manila” (the Ordinance).” The ordinance sanctions any person individuals.
or corporation who will allow the admission and charging of room
rates for less than 12 hours or the renting of rooms more than The due process guaranty serves as a protection against
twice a day. arbitrary regulation or seizure. Even corporations and
partnerships are protected by the guaranty insofar as their
property is concerned. The due process guaranty has
The petitioners White Light Corporation (WLC), Titanium
traditionally been interpreted as imposing two related but
Corporation (TC), and Sta. Mesa Tourist and Development
distinct restrictions on government, "procedural due process"
Corporation (STDC), who own and operate several hotels and and "substantive due process."
motels in Metro Manila, filed a motion to intervene and to admit
attached complaint-in-intervention on the ground that the Procedural due process refers to the procedures that the
ordinance will affect their business interests as operators. The government must follow before it deprives a person of life,
respondents, in turn, alleged that the ordinance is a legitimate liberty, or property.49 Procedural due process concerns itself
exercise of police power. with government action adhering to the established process
when it makes an intrusion into the private sphere. Examples
RTC declared Ordinance No. 7774 null and void as it “strikes at range from the form of notice given to the level of formality of
the personal liberty of the individual guaranteed and jealously a hearing. If due process were confined solely to its procedural
guarded by the Constitution.” Reference was made to the aspects, there would arise absurd situation of arbitrary
provisions of the Constitution encouraging private enterprises government action, provided the proper formalities are
and the incentive to needed investment, as well as the right to followed.
operate economic enterprises. Finally, from the observation that
the illicit relationships the Ordinance sought to dissuade could Substantive due process completes the protection
nonetheless be consummated by simply paying for a 12-hour envisioned by the due process clause. It inquires whether the
stay, government has sufficient justification for depriving a person
When elevated to CA, the respondents asserted that the of life, liberty, or property. The question of substantive due
ordinance is a valid exercise of police power pursuant to Section process, moreso than most other fields of law, has reflected
458 (4)(iv) of the Local Government Code which confers on cities dynamism in progressive legal thought tied with the expanded
the power to regulate the establishment, operation and acceptance of fundamental freedoms. Police power,
traditionally awesome as it may be, is now confronted with a
maintenance of cafes, restaurants, beerhouses, hotels, motels,
more rigorous level of analysis before it can be upheld. The
inns, pension houses, lodging houses and other similar
vitality though of constitutional due process has not been
establishments, including tourist guides and transports. Also, they predicated on the frequency with which it has been utilized to
contended that under Art III Sec 18 of Revised Manila Charter, achieve a liberal result for, after all, the libertarian ends should
TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION
they have the power to enact all ordinances it may deem
necessary and proper for the sanitation and safety, the
furtherance of the prosperity and the promotion of the morality,
peace, good order, comfort, convenience and general welfare of
the city and its inhabitants and to fix penalties for the violation of
ordinances.
Petitioners argued that the ordinance is unconstitutional and void
since it violates the right to privacy and freedom of movement; it
is an invalid exercise of police power; and it is unreasonable and
oppressive interference in their business.
CA, in turn, reversed the decision of RTC and affirmed the
constitutionality of the ordinance. First, it held that the ordinance
did not violate the right to privacy or the freedom of movement,
as it only penalizes the owners or operators of establishments
that admit individuals for short time stays. Second, the virtually
limitless reach of police power is only constrained by having a
lawful object obtained through a lawful method. The lawful
objective of the ordinance is satisfied since it aims to curb
immoral activities. There is a lawful method since the
establishments are still allowed to operate. Third, the adverse
effect on the establishments is justified by the well-being of its
constituents in general.
Hence, the petitioners appeared before the SC.
The petitioner was employed by respondent Philippine Amusement
and Gaming Corporation (PAGCOR) He was PAGCOR’s Managing
Head of its Gaming Department at the time of his dismissal from
office.[
He received a letter from Teresita S. Ela, the Senior Managing Head
of PAGCOR’s Human Resources Department, advising that he was
being administratively charged with gross misconduct, rumor-
mongering, conduct prejudicial to the interest of the company, and
loss of trust and confidence; that he should submit a written
explanation of the charges; and that he was at the same time being
placed under preventive suspension.
RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION
The petitioner would have the
Court hold that PAGCOR’s
failure to furnish him a copy of
the Board Resolutions
authorizing his dismissal and
denying his motion for
reconsideration was a fatal and
irreparable defect in the
administrative proceedings that
ultimately resulted in the
illegality of his dismissal from
the service. He further argues
RULING
sometimes yield to the prerogatives of the State. Instead, the
due process clause has acquired potency because of the
sophisticated methodology that has emerged to determine the
proper metes and bounds for its application.
The general test of the validity of an ordinance on substantive
due process grounds is best tested when assessed with the
evolved footnote 4 test laid down by the U.S. Supreme Court
in U.S. v. Carolene Products.51 Footnote 4 of the Carolene
Products case acknowledged that the judiciary would defer to
the legislature unless there is a discrimination against a
"discrete and insular" minority or infringement of a
"fundamental right."52 Consequently, two standards of judicial
review were established: strict scrutiny for laws dealing with
freedom of the mind or restricting the political process, and the
rational basis standard of review for economic legislation. A
third standard, denominated as heightened or immediate
scrutiny, was later adopted by the U.S. Supreme Court for
evaluating classifications based on gender53 and
legitimacy.54 Immediate scrutiny was adopted by the U.S.
Supreme Court in Craig,55 after the Court declined to do so in
Reed v. Reed.
Due process, as a constitutional precept, does not always and
in all situations require a trial-type proceeding. Due process is
satisfied when a person is notified of the charge against him
and given an opportunity to explain or defend himself. In
administrative proceedings, the filing of charges and giving
reasonable opportunity for the person so charged to answer
the accusations against him constitute the minimum
requirements of due process. The essence of due process is
simply to be heard, or as applied to administrative
proceedings, an opportunity to explain one’s side, or an
opportunity to seek a reconsideration of the action or ruling
complained of
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION
Vivo v. The petitioner’s counsel, replying to Ela’s letter, assailed the propriety
of the show-cause memorandum as well as the basis for placing the
Philippine petitioner under preventive suspension. On March 14, 2002, the
Amusement petitioner received the summons for him to attend an administrative
inquiry, instructing him to appear before PAGCOR’s Corporate
and Game Investigation Unit (CIU) on March 15, 2002.
Corporation
At the petitioner’s request, however, the inquiry was conducted at his
residence on said date. His statement was taken in a question-and-
answer format. He was also furnished the memorandum of charges
that recited the accusations against him and indicated the acts and
omissions constituting his alleged offenses. The memorandum of
charges was based on the statements of PAGCOR personnel who
had personal knowledge of the accusations against him. However,
when his counsel requested to be furnished copies of the statements,
PAGCOR rejected the request on the ground that he had already
been afforded the sufficient opportunity to confront, hear, and answer
the charges against him during the administrative inquiry. The
petitioner was then allowed to submit his answer on March 26, 2002.
Thereafter, the CIU tendered its investigation report to PAGCOR’s
Adjudication Committee.
The Adjudication Committee summoned the petitioner to appear
before it on May 8, 2002 in order to address questions regarding his
case. His counsel moved for the re-scheduling of the meeting
because he would not be available on said date, but the Adjudication
Committee denied the request upon the reason that the presence of
counsel was not necessary in the proceedings. His counsel moved
for the reconsideration of the denial of the request. The petitioner
received the letter dated May 15, 2002 from Ela informing him of the
resolution of the PAGCOR Board of Directors in its May 14, 2002
meeting to the effect that he was being dismissed from the service.
After the petitioner’s motion for reconsideration vis-à-vis the
resolution of the PAGCOR Board of Directors dismissing him from the
service was denied, he appealed his dismissal to the CSC.
CSC PETITION GRANTED, CA PETITION REVERSE AND SET
ASIDE
that he was denied due
process by PAGCOR’s refusal
to re-schedule the Adjudication
Committee meeting in order to
enable his counsel to attend
the meeting with him, because
the refusal constituted a
violation of his right to be
represented by counsel.
RULING
The petitioner actively participated in the entire course of the
investigation and hearings conducted by PAGCOR. He
received the letter from Ela apprising him of his being
administratively charged for several offenses, and directing
him to submit an explanation in writing. He was later on
properly summoned to appear before the CIU, which
conducted its proceedings in his own residence upon his
request. During the administrative inquiry, the CIU served him
a copy of the memorandum of charges, which detailed the
accusations against him and specified the acts and omissions
constituting his alleged offenses. He was also given the
opportunity to appear before the Adjudication Committee to
answer clarificatory questions. Lastly, he was informed
through a memorandum of the decision of the Board of
Directors dismissing him from the service.
The essence of procedural due process is embodied in the
basic requirement of notice and a real opportunity to be heard.
In administrative proceedings, such as in the case at bar,
procedural due process simply means the opportunity to
explain one’s side or the opportunity to seek a reconsideration
of the action or ruling complained of. “To be heard” does not
mean only verbal arguments in court; one may be heard also
thru pleadings. Where opportunity to be heard, either through
oral arguments or pleadings, is accorded, there is no denial of
procedural due process. In administrative proceedings,
procedural due process has been recognized to include the
following: (1) the right to actual or constructive notice of the
institution of proceedings which may affect a respondent’s
legal rights; (2) a real opportunity to be heard personally or
with the assistance of counsel, to present witnesses and
evidence in one’s favor, and to defend one’s rights; (3) a
tribunal vested with competent jurisdiction and so constituted
as to afford a person charged administratively a reasonable
guarantee of honesty as well as impartiality; and (4) a finding
by said tribunal which is supported by substantial evidence
submitted for consideration during the hearing or contained in
the records or made known to the parties affected
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION
Pursuant to Administrative Order implementing the "Do-It-Yourself"
Program in the LTO, Gutierrez, Chief of the LTO Registration Section,
received a Memorandum instructing her to temporarily relocate her
Section's equipment to the Bulwagang R.F. Edu in order to
Disciplinary accommodate the renovation of the work stations in the said program
Board v.
Gutierrez On even date, Gutierrez sent a reply--Memorandumwhich, inter alia,
raised concerns about the safety and integrity of the records kept at
her office during the transfer; and at the same time, asked the role of
the Registration Section once the aforesaid program kicks off.
This prompted the LTO to issue a Memorandumdirecting Gutierrez to
show cause why no disciplinary action should be taken against her
for non-compliance with the relocation directive (Show Cause
Memorandum). In response, Gutierrez sent a letter-reply maintaining
that the Registration Section is ready and willing to comply with the
relocation directive and that their equipment is ready for pick-up
whenever the LTO may see fit. Further, Gutierrez reiterated the
various concerns she raised m her earlier reply--Memorandum.
the LTO issued a Formal Charge[11] dated June 2, 2014 charging her
of Gross Insubordination, Refusal to Perform Official Duties, and
Conduct Prejudicial to the Best Interest of the Service, giving her five
(5) days from receipt thereof to file her Answer and supporting
affidavits, and preventively suspending her for a period of ninety (90)
days
the LTO found Gutierrez's claim untenable and, accordingly, directed
the parties to prepare for the pre-hearing conference. It found that the
Show Cause Memorandum already takes the place of a preliminary
investigation and, thus, she was not deprived of procedural due
processThe foregoing was reiterated in the LTO's Order[dated
September 4, 2014 where it was held that the Formal Charge against
Gutierrez was issued following the issuance of the Show Cause
Memorandum, as well as the conduct of a preliminary or fact-finding
investigation. On appeal to the CSC, the foregoing LTO Orders were
affirmed by the CSC's Decision dated November 11, 2014 and
Resolution dated January 29, 2015
CA REVERSE AND SET ASIDE, NO DUE PROCESS
RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
In this case, records show that the Formal Charge against
Gutierrez was issued following the LTO's issuance of a Show
Cause Memorandum. Under Section 16 of the Revised Rules
on Administrative Cases in the Civil Service (RRACCS), a
Show Cause Memorandum emanating from the disciplining
authority or its authorized representative is sufficient to
institute preliminary investigation proceedings.
"The essence of procedural due process is embodied in the
basic requirement of notice and a real opportunity to be heard.
In administrative proceedings, as in the case at bar,
procedural due process simply means the opportunity to
explain one's side or the opportunity to seek a reconsideration
of the action or ruling complained of. 'To be heard' does not
mean only verbal arguments in court; one may also be heard
thru pleadings. Where opportunity to be heard, either through
oral arguments or pleadings, is accorded, there is no denial of
procedural due process.
A reading of the Show Cause Memorandum issued by the
LTO shows that Gutierrez was directed to explain why no
disciplinary action should be taken against her. The latter then
duly complied therewith by submitting her letter-reply pursuant
thereto. Evidently, Gutierrez was accorded her right to
procedural due process when she was given an opportunity to
be heard before the LTO found a prima facie case against her,
which thus, necessitated the issuance of the Formal Charge.
In fact, even after the issuance of a Formal Charge, the LTO
continued to respect Gutierrez's right to procedural due
process as it allowed her to file an Answer to refute the
charges of Gross Insubordination, Refusal to Perform Official
Duties, and Conduct Prejudicial to the Best Interest of the
Service against her.
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING

COMMISSIONER OF Under our tax laws, manufacturers of cigarettes are subject to pay The CIR posits that the Fortune Uniformity in taxation requires that all subjects or objects of
INTERNAL REVENUE, excise taxes on their products. Prior to January 1, 1997, the excises inclusion of the proviso in Tobacco’s claim taxation, similarly situated, are to be treated alike both in
Petitioner, taxes on these products were in the form of ad valorem taxes (tax Section 1 of RR 17-99 was for refund of privileges and liabilities. This requirement, however, is
vs. based on the value of transaction or of property, added to the value made to carry into effect the overpaid excise unwittingly violated when the proviso in Section 1 of RR 17-99
FORTUNE TOBACCO thereof such as VAT), pursuant to Section 142 of the 1977 National law’s intent and is well within taxes is based
CORPORATION, Internal Revenue Code. Beginning January 1, 1997, Republic Act the scope of his delegated primarily on what
Respondent. No. (RA) 82403 took effect and a shift from ad valorem to specific legislative authority. He claims it considers as
taxes was made. The specific tax from any brand of cigarettes that the CTA’s strict an
within the next three (3) years of effectivity of this Act shall not interpretation of the law "unauthorized
be lower than the tax [which] is due from each brand on October ignored Congress’ intent "to administrative
1, 1996: Provided, however, That in cases where the specific tax rates increase the collection of legislation" on
imposed in paragraphs (1), (2), (3) and (4) hereinabove will result in excise taxes by increasing the part of the is applied in certain cases. Although the brands all belong to
an increase in excise tax of more than seventy percent (70%), for a specific tax rates on ‘sin’ CIR. the same category, the proviso in Section 1, RR 17-99
brand of cigarette, the increase shall take effect in two tranches: fifty products." He cites portions of Specifically, it authorized the imposition of different (and grossly
percent (50%) of the increase shall be effective in 1997 and one the Senate’s deliberation on assails the disproportionate) tax rates (see column [D]). It effectively
hundred percent (100%) of the increase shall be effective in 1998. House Bill No. 7198 (the proviso in extended the qualification stated in the third paragraph of
The rates of specific tax on cigars and cigarettes under paragraphs precursor of RA 8240) that Section 1 of RR Section 145(c) of the 1997 Tax Code that was supposed to
(1), (2), (3) and (4) hereof, shall be increased by twelve percent (12%) conveyed the legislative intent 17-99 that apply only during the transition period: The excise tax from
on January 1, 2000. Pursuant to these laws, respondent Fortune to increase the excise taxes requires the any brand of cigarettes within the next three (3) years from the
Tobacco Corporation (Fortune Tobacco) paid in advance excise taxes being paid. payment of the effectivity of R.A. No. 8240 shall not be lower than the tax,
for the year 2003 in the amount of ₱11.15 billion, and for the period "excise tax which is due from each brand on October 1, 1996.
covering January 1 to May 31, 2004 in the amount of ₱4.90 billion. In actually being
June 2004, Fortune Tobacco filed an administrative claim for tax paid prior to In the process, the CIR also perpetuated the unequal tax
refund with the CIR for erroneously and/or illegally collected taxes in January 1, 2000" treatment of similar goods that was supposed to be cured by
the amount of ₱491 million. if this amount is the shift from ad valorem to specific taxes. This bill serves as
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
higher than the a catch-up measure as government attempts to collect
new specific tax additional revenues due it since 2001. Modifications are
rate, i.e., the necessary indeed to capture the loss proceeds and prevent
rates of specific further erosion in revenue base. x x x. As it is, it plugs a major
taxes imposed in loophole in the ambiguity of the law as evidenced by recent
1997 for each disputes resulting in the government being ordered by the
category of courts to refund taxpayers. This bill clarifies that the excise tax
cigarette, plus due on the products shall not be lower than the tax due as of
12%. It claimed the date immediately prior to the effectivity of the act or the
that by including excise tax due as of December 31, 1999. This remark
the proviso, the notwithstanding, the final version of the bill that became RA
CIR went 9334 contained no provision similar to the proviso in Section
beyond the 1 of RR 17-99 that imposed the tax due as of December 31,
language of the 1999 if this tax is higher than the new specific tax rates. Thus,
law and usurped it appears that despite its awareness of the need to protect the
Congress’ increase of excise taxes to increase government revenue,
power. Congress ultimately decided against adopting the "higher tax
rule.

WHEREFORE, in view of the foregoing, the petition is

DENIED. The decision dated July 12, 2007 and the resolution
dated October 4, 2007 of the Court of Tax Appeals in CTA
E.B. No. 228 are AFFIRMED. No pronouncement as to costs.
ARTURO M. TOLENTINO, These are motions seeking reconsideration of our decision dismissing It is contended, for the reasons Equality and uniformity of taxation means that all taxable
petitioner, the petitions filed in these cases for the declaration of already noted, that R.A. No. articles or kinds of property of the same class be taxed at the
vs. unconstitutionality of R.A. No. 7716, otherwise known as the 7716 also violates Art. VI, same rate. The taxing power has the authority to make
THE SECRETARY OF Expanded Value-Added Tax Law. §28(1) which provides that reasonable and natural classifications for purposes of
FINANCE and THE "The rule of taxation shall be taxation. To satisfy this requirement it is enough that the
COMMISSIONER OF uniform and equitable. The statute or ordinance applies equally to all persons, forms and
INTERNAL REVENUE, Congress shall evolve a corporations placed in similar situation. The CREBA claims
respondents. progressive system of that the VAT is regressive. A similar claim is made by the
taxation." Cooperative Union of the Philippines, Inc. (CUP), while
petitioner Juan T. David argues that the law contravenes the
mandate of Congress to provide for a progressive system of
taxation because the law imposes a flat rate of 10% and thus
places the tax burden on all taxpayers without regard to their
ability to pay. The Constitution does not really prohibit the
imposition of indirect taxes which, like the VAT, are
regressive. What it simply provides is that Congress shall
"evolve a progressive system of taxation." The constitutional
provision has been interpreted to mean simply that "direct
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
taxes are . . . to be preferred [and] as much as possible,
indirect taxes should be minimized." Indeed, the mandate to
Congress is not to prescribe, but to evolve, a progressive
tax system. Resort to indirect taxes should be minimized
but not avoided entirely because it is difficult, if not
impossible, to avoid them by imposing such taxes
according to the taxpayers' ability to pay. In the case of the
VAT, the law minimizes the regressive effects of this
imposition by providing for zero rating of certain transactions,
while granting exemptions to other transactions.
NURSERY CARE The City of Manila assessed and collected taxes from the individual The petitioners point out that The respondents Petitioners obstinately ignore the exempting proviso in
CORPORATION; petitioners pursuant to Section 15 (Tax on Wholesalers, Distributors, although Section 21 of the counter, Section 21 of Tax Ordinance No. 7794, to their own
SHOEMART, INC.; STAR or Dealers) and Section 17 (Tax on Retailers) of the Revenue Code Revenue Code of Manila was however, that detriment. Said exempting proviso was precisely included in
APPLIANCE CENTER, of Manila. At the same time, the City of Manila imposed additional not itself unconstitutional or double taxation said section so as to avoid double taxation. The Court finds
INC.; H&B, INC.; SUPPLIES taxes upon the petitioners pursuant to Section 21 of the Revenue invalid, its enforcement against did not occur that there is indeed double taxation if respondent is subjected
STATION, INC.; and Code of Manila, as amended, as a condition for the renewal of their the petitioners constituted from the to the taxes under both Sections 14 and 21 of Tax Ordinance
HARDWARE WORKSHOP, respective business licenses for the year 1999. By letter dated March double taxation because the imposition and No. 7794, since these are being imposed: (1) on the same
INC., Petitioners, 1, 1999, the petitioners formally requested the Office of the City local business taxes under collection of the subject matter – the privilege of doing business in the City of
vs. Treasurer for the tax credit or refund of the local business taxes paid Section 15 and Section 17 of tax pursuant to Manila; (2) for the same purpose – to make persons
ANTHONY ACEVEDO, in under protest. However, then City Treasurer Anthony Acevedo the Revenue Code of Manila Section 21 of the conducting business within the City of Manila contribute to city
his capacity as THE (Acevedo) denied the request. were already being paid by Revenue Code revenues; (3) by the same taxing authority – petitioner City
TREASURER OF MANILA; them. They contend that the of Manila; that of Manila; (4) within the same taxing jurisdiction – within
and THE CITY OF MANILA, proviso in Section 21 exempted the taxes the territorial jurisdiction of the City of Manila; (5) for the same
Respondents. all registered businesses in the imposed taxing periods – per calendar year; and (6) of the same kind
City of Manila from paying the pursuant to or character – a local business tax imposed on gross sales
tax imposed under Section 21; Section 21 were or receipts of the business.
and that the exemption was in the concept of S P A J P K
MANILA CITY more in accord with Section
143 of the Local Government
indirect taxes
upon the
Firstly, because Section 21 of the Revenue Code of Manila
imposed the tax on a person who sold goods and services in
TAXATION Code, the law that vested in the consumers of the course of trade or business based on a certain percentage
S municipal and city the goods and ofhis gross sales or receipts in the preceding calendar year,
P governments the power to services sold by while Section 15 and Section 17 likewise imposed the tax on
A impose business taxes. a business a person who sold goods and services in the course of trade
J establishment; or business but only identified such person with particularity,
P and that the namely, the wholesaler, distributor or dealer (Section 15), and
K petitioners did the retailer (Section 17), all the taxes – being imposed on the
not exhaust their privilege of doing business in the City of Manila in order to
administrative make the taxpayers contribute to the city’s revenues – were
remedies by first imposed on the same subject matter and for the same
appealing to the purpose. Secondly, the taxes were imposed by the same
Secretary of taxing authority (the City of Manila) and within the same
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
Justice to jurisdiction in the same taxing period (i.e., per calendar year).
challenge the Thirdly, the taxes were all in the nature of local business taxes.
constitutionality
or legality of the WHEREFORE, the Court GRANTS the petition for review on
tax ordinance. certiorari; REVERSES and SETS ASIDE the resolutions
promulgated on June 18, 2007 and November 14, 2007 in CA-
G.R. SP No. 72191; and DIRECTS the City of Manila to refund
the payments made by the petitioners of the taxes assessed
and collected for the first quarter of 1999 pursuant to Section
21 of the Revenue Code of Manila.
AIR CANADA, Petitioner, An offline international air carrier selling passage tickets in the Petitioner claims that the Respondent At the outset, we affirm the Court of Tax Appeals’ ruling that
vs. Philippines, through a general sales agent, is a resident foreign general provision imposing the maintains that petitioner, as an offline international carrier with no landing
COMMISSIONER OF corporation doing business in the Philippines. As such, it is regular corporate income tax petitioner is rights in the Philippines, is not liable to tax on Gross Philippine
INTERNAL REVENUE, taxable under Section 28(A)(l), and not Section 28(A)(3) of the 1997 on resident foreign subject to the Billings. Under the foregoing provision, the tax attaches
Respondent. National Internal Revenue Code, subject to any applicable tax treaty corporations provided under 32% corporate only when the carriage of persons, excess baggage,
to which the Philippines is a signatory. Pursuant to Article 8 of the Section 28(A)(1) of the 1997 income tax as a cargo, and mail originated from the Philippines in a
Republic of the Philippines-Canada Tax Treaty, Air Canada may National Internal Revenue resident foreign continuous and uninterrupted flight, regardless of where
OFFLINE only be imposed a maximum tax of 1 ½% of its gross revenues
earned from the sale of its tickets in the Philippines. As an off-line
Code does not apply to
"international carriers," which
corporation
doing business
the passage documents were sold. Not having flights to
and from the Philippines, petitioner is clearly not liable for
CARRIER carrier, [Air Canada] does not have flights originating from or coming are especially classified and in the the Gross Philippine Billings tax. Petitioner, an offline
to the Philippines [and does not] operate any airplane [in] the taxed under Section 28(A)(3). Philippines. carrier, is a resident foreign corporation for income tax
Philippines[.]" On July 1, 1999, Air Canada engaged the services of Petitioner states that the Respondent purposes. Petitioner falls within the definition of resident
Aerotel Ltd., Corp. (Aerotel) as its general sales agent in the income it derived from the further contends foreign corporation under Section 28(A)(1) of the 1997
Philippines. Aerotel "sells [Air Canada’s] passage documents in sale of airline tickets in the that petitioner is National Internal Revenue Code, thus, it may be subject
the Philippines." For the period ranging from the third quarter of Philippines was income from not entitled to its to 32% tax on its taxable income. There is no specific
2000 to the second quarter of 2002, Air Canada, through Aerotel, filed services and not income claim for refund criterion as to what constitutes "doing" or "engaging in" or
quarterly and annual income tax returns and paid the income tax on from sales of personal because the "transacting" business. Each case must be judged in the light
Gross Philippine Billings. property. Accordingly, amount of of its peculiar environmental circumstances. The term implies
applying the principle on the ₱5,185,676.77 it a continuity of commercial dealings and arrangements, and
In the Decision dated August 26, 2005, the Court of Tax Appeals En situs of taxation in taxation of paid as tax from contemplates, to that extent, the performance of acts or works
Banc affirmed the findings of the First Division. The En Banc ruled services, petitioner claims that the third quarter or the exercise of some of the functions normally incident to,
that Air Canada is subject to tax as a resident foreign corporation its income derived "from of 2000 to the and in progressive prosecution of commercial gain or for the
doing business in the Philippines since it sold airline tickets in the services rendered outside the second quarter purpose and object of the business organization." Further,
Philippines. Philippines [was] not subject to of 2001 was still petitioner was issued by the Civil Aeronautics Board an
Philippine income taxation." short of the 32% authority to operate as an offline carrier in the Philippines for
income tax due a period of five years, or from April 24, 2000 until April 24,
for the period. 2005. Petitioner is, therefore, a resident foreign
corporation that is taxable on its income derived from
sources within the Philippines. Petitioner’s income from
sale of airline tickets, through Aerotel, is income realized from
the pursuit of its business activities in the Philippines.
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
However, the application of the regular 32% tax rate under
Section 28(A)(1) of the 1997 National Internal Revenue
Code must consider the existence of an effective tax
treaty between the Philippines and the home country of
the foreign air carrier. The apparent rationale for doing away
with double taxation is to encourage the free flow of goods
and services and the movement of capital, technology
and persons between countries, conditions deemed vital
in creating robust and dynamic economies. Foreign
investments will only thrive in a fairly predictable and
reasonable international investment climate and the
protection against double taxation is crucial in creating such a
climate. Tax treaties are entered into "to reconcile the national
fiscal legislations of the contracting parties and, in turn, help
the taxpayer avoid simultaneous taxations in two different
jurisdictions."

WHEREFORE, the Petition is DENIED. The Decision dated

August 26, 2005 and Resolution dated April 8, 2005 of the
Court of Tax Appeals En Banc are AFFIRMED.
COMMISSIONER OF For the calendar year 1995, [respondent] seasonably filed its Petitioner claims that although [Respondent] We agree with petitioner. The 5% GRT is included under
INTERNAL REVENUE, Quarterly Percentage Tax Returns reflecting gross receipts the 20% FWT on respondent’s alleges that the "Title V. Other Percentage Taxes" of the Tax Code and is
petitioner, (pertaining to 5% [Gross Receipts Tax] rate) in the total amount of interest income was not total gross not subject to withholding. The banks and non-bank
vs. ₱1,474,691,693.44 with corresponding gross receipts tax payments actually received by receipts in the financial intermediaries liable therefor shall, under Section
SOLIDBANK in the sum of ₱73,734,584.60. respondent because it was amount of 125(a)(1), file quarterly returns on the amount of gross
CORPORATION, remitted directly to the ₱1,474,691,693 receipts and pay the taxes due thereon within twenty (20) days
respondent. government, the fact that the .44 included the after the end of each taxable quarter. The 20% FWT, on the
amount redounded to the sum of other hand, falls under Section 24(e)(1)19 of "Title II. Tax on
bank’s benefit makes it part of ₱350,807,875.1 Income." It is a tax on passive income, deducted and
the taxable gross receipts in 5 representing withheld at source by the payor-corporation and/or
FINAL computing the 5% GRT. gross receipts
from passive
person as withholding agent pursuant to Section 50, and
paid in the same manner and subject to the same conditions
WITHHOLDING income which as provided for in Section 51. In our withholding tax system,
was already possession is acquired by the payor as the withholding agent
TAX & GROSS subjected to of the government, because the taxpayer ratifies the very act
RECEIPTS TAX 20% final
withholding tax.
of possession for the government. There is thus constructive
receipt. The processes of bookkeeping and accounting for
interest on deposits and yield on deposit substitutes that are
subjected to FWT are indeed -- for legal purposes --
tantamount to delivery, receipt or remittance.
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
No. double taxation. First, the taxes herein are imposed on
two different subject matters. The subject matter of the FWT
is the passive income generated in the form of interest on
deposits and yield on deposit substitutes, while the
subject matter of the GRT is the privilege of engaging in
the business of banking. Second, although both taxes are
national in scope because they are imposed by the same
taxing authority -- the national government under the Tax
Code -- and operate within the same Philippine jurisdiction for
the same purpose of raising revenues, the taxing periods
they affect are different. The FWT is deducted and
withheld as soon as the income is earned, and is paid
after every calendar quarter in which it is earned. On the
other hand, the GRT is neither deducted nor withheld, but
is paid only after every taxable quarter in which it is
earned. Third, these two taxes are of different kinds or
characters. The FWT is an income tax subject to
withholding, while the GRT is a percentage tax not
subject to withholding.
ASIATRUST On separate dates in February 2000, Asiatrust Development Bank, Asiatrust contends that the The CIR, In this case, Asiatrust failed to present a termination letter from
DEVELOPMENT BANK, Inc. (Asiatrust) received from the Commissioner of Internal Revenue CTA En Banc erred in affirming however, points the BIR. Instead, it presented a Certification issued by the BIR
INC., Petitioners, (CIR) three Formal Letters of Demand (FLD) with Assessment the assessment for deficiency out that the BIR to prove that it availed of the Tax Abatement Program and paid
vs. Notices for deficiency internal revenue taxes in the amounts of final withholding tax for fiscal Certification the basic tax. It also attached copies of its BIR Tax Payment
COMMISSIONER OF P131,909,161.85, P83,012,265.78, and year ending June 30, 1998 relied upon by Deposit Slips and a Jetter issued by RDO Nacar. These
INTERNAL REVENUE, ₱l44,012,918.42 for fiscal years ending June 30, 1996, 1997, and considering that it already Asiatrust does documents, however, do not prove that Asiatrust's
Respondents 1998, respectively. Asiatrust filed before the CTA a Petition for availed of the Tax Abatement not cover fiscal application for tax abatement has been approved. If at all,
Review praying for the cancellation of the tax assessments for Program as evidenced by the year ending these documents only prove Asiatrust's payment of basic
deficiency income tax, documentary stamp tax (DST) - regular, DST Certification issued by the June 30, 1998. taxes, which is not a ground to consider its deficiency tax
NO APPROVED - industry issue, final withholding tax, expanded withholding tax, and
fringe benefits tax issued against it by the CIR.
BIR, the letter issued by RDO
Nacar, and the BIR Tax
And even if the
letter issued by
assessment closed and terminated.

TAX ABATEMENT Payment Deposit Slips. RDO Nacar and Since no termination letter has been issued by the BIR, there
the BIR Tax is no reason for the Court to consider as closed and
APPLICATION Payment terminated the tax assessment on Asiatrust's final withholding
Deposit Slips tax for fiscal year ending June 30, 1998. Asiatrust's application
were admitted in for tax abatement will be deemed approved only upon the
evidence, the issuance of a termination letter, and only then will the
result would still deficiency tax assessment be considered closed and
be the same as terminated. However, in case Asiatrust's application for tax
these are not abatement is denied, any payment made by it would be
sufficient to applied to its outstanding tax liability. For this reason,
prove that Asiatrust's allegation of double taxation must also fail.
 TITLE
THE CITY OF MANILA,
LIBERTY M. TOLEDO, in
her capacity as THE
TREASURER OF MANILA
and JOSEPH SANTIAGO,
in his capacity as the CHIEF
OF THE LICENSE DIVISION
OF CITY OF MANILA,
petitioners,
vs.
COCA-COLA BOTTLERS
PHILIPPINES, INC.,
Respondent.
SECTIONS 14 &
21
FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
Asiatrust
validly availed
of the Tax
Abatement
Program.
Prior to 25 February 2000, respondent had been paying the City of Double taxation means taxing the same property twice when
Manila local business tax only under Section 14 of Tax it should be taxed only once; that is, "taxing the same person
Ordinance No. 7794, being expressly exempted from the twice by the same jurisdiction for the same thing." It is
business tax under Section 21 of the same tax ordinance. obnoxious when the taxpayer is taxed twice, when it should
Petitioner City of Manila subsequently approved on 25 February be but once. Otherwise described as "direct duplicate
2000, Tax Ordinance No. 7988, amending certain sections of Tax taxation," the two taxes must be imposed on the same subject
Ordinance No. 7794. Tax Ordinances No. 7988 and No. 8011 were matter, for the same purpose, by the same taxing authority,
later declared by the Court null and void in Coca-Cola Bottlers within the same jurisdiction, during the same taxing period;
Philippines, Inc. v. City of Manila. However, before the Court could and the taxes must be of the same kind or character. Using
declare Tax Ordinance No. 7988 and Tax Ordinance No. 8011 null the aforementioned test, the Court finds that there is indeed
and void, petitioner City of Manila assessed respondent on the basis double taxation if respondent is subjected to the taxes under
of Section 21 of Tax Ordinance No. 7794, as amended by the both Sections 14 and 21 of Tax Ordinance No. 7794, since
aforementioned tax ordinances, for deficiency local business taxes, these are being imposed: (1) on the same subject matter –
penalties, and interest, in the total amount of ₱18,583,932.04, for the the privilege of doing business in the City of Manila; (2) for the
third and fourth quarters of the year 2000. Respondent filed a protest same purpose – to make persons conducting business within
with petitioner Toledo on the ground that the said assessment the City of Manila contribute to city revenues; (3) by the same
amounted to double taxation, as respondent was taxed twice, i.e.,
under Sections 14 and 21 of Tax Ordinance No. 7794, as amended
taxing authority – petitioner City of Manila; (4) within the
same taxing jurisdiction – within the territorial jurisdiction of
by Tax Ordinances No. 7988 and No. 8011. the City of Manila; (5) for the same taxing periods – per
calendar year; and (6) of the same kind or character – a
local business tax imposed on gross sales or receipts of the
business.

WHEREFORE, premises considered, the instant Petition for

Review on Certiorari is hereby DENIED. No costs.
COMMISIONER OF A novel question, one of importance and significance, is before this His estate, it was claimed, The At the time then when the Ordinance took effect in April, 1947,
INTERNAL REVENUE, Court in this petition for the review of a decision of the Court of Tax "was entitled to the same Commissioner of the strict rule against tax exemption was undisputed and
petitioner, Appeals. For the first time, the Ordinance appended to the rights and privileges as Internal indisputable. Such being the case, it would be a plain
vs. Constitution calls for interpretation, having been invoked to justify a Filipino citizens operating Revenue departure from the terms of the Ordinance to predicate a tax
A. D. GUERRERO, Special claim for refund of taxes by the estate of an American national, who public utilities including disagreed, ruling exemption where none was intended. If the language of the
Administrator, in substitution in his life-time was engaged in the air transportation business. More privileges in the matter of that such partial Ordinance applies to tax refund or exemption, then the Court
of NATHANIEL I. GUNN, as specifically, the issue is whether or not Section 142 of the National taxation." exemption from of Tax Appeals should be sustained. It does not, however. Its
Administrator of the Estate of Internal Revenue Code allowing Filipinos a refund of 50 percentum of the gasoline tax terms are clear. Standing alone, without any franchise to
the late PAUL I. GUNN, the specific tax paid on aviation oil, could be availed of by citizens of was not included supply that omission, it affords no warrant for the claim here
respondent. the United States and all forms of business enterprises owned or under the terms made. While good faith, no less than adherence to the
controlled directly by them in view of the privilege under the Ordinance of the Ordinance categorical wording of the Ordinance, requires that all the
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION
to operate public utilities "in the same manner as to, and under the
RECIPROCITY same conditions imposed upon, citizens of the Philippines or
corporations or associations owned or controlled by citizens of the
ON 50% Philippines."
REFUND FOR The Commissioner of Internal Revenue, now petitioner before this
AMERICAN Court, denied the claim for refund in the sum of P2,441.93 filed by the
administrator of the estate of Paul I. Gunn, thereafter substituted by
CITIZENS the present respondent A. D. Guerrero as special administrator under
the above section of the National Internal Revenue Code. The
deceased operated an air transportation business under the
business name and style of Philippine Aviation Development.
SEA-LAND SERVICE, INC., Sea-Land Service Incorporated (SEA-LAND), an American
petitioner, international shipping company licensed by the Securities and
RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
and that in rights and privileges thus granted to Americans and
accordance with
the statute, to be
business enterprises owned and controlled by them be
respected, anything further would not be warranted.
entitled to its Nothing less will suffice, but anything more is not justified. This
benefits, there conclusion has reinforcement that comes to it from another
must be a avenue of approach, the historical background of the
showing that the
United States of
Ordinance. Early in 1945, liberation primarily through the
efforts of the American forces under General MacArthur,
which the assisted by Filipino guerrillas, heralded the dawn, awaited so
deceased was a long and so anxiously, ending the dark night of the Japanese
citizen granted a Occupation, which was only partly mitigated by a show of
similar cooperation on the part of some Filipino leaders of stature and
exemption to eminence. The toll in the destruction of the property and the
Filipinos. loss of lives was heavy; the price the Filipinos paid was high.
There was thus a clear need of help from the United States.
American aid was forthcoming but on terms proposed by her
government and later on accepted by the Philippines. One
such condition expressly set forth in the Philippine Trade Act
of 1946 passed by the Congress of the United States was that:
"The disposition, exploitation, development, and utilization of
all agricultural, timber, and mineral lands of the public domain,
waters, minerals, coal, petroleum, and other mineral oils, all
forces and sources of potential energy, and other natural
resources of the Philippines, and the operation of public
utilities, shall, if open to any person, be open to citizens of the
United States and to all forms of business enterprises owned
or controlled directly or indirectly, by United States citizens."
The Ordinance thus came into being at a time when the
liberation of the Philippines had elicited a vast reservoir
of goodwill for the United States, one that has lasted to this
day notwithstanding irritants that mar ever so often the
relationship even among the most friendly of nations.
WHEREFORE, the decision of the Court of Tax Appeals is
reversed and the case is remanded to it, to grant respondent
Administrator the opportunity of proving whether the estate
could claim the benefits of Section 142 of the National Internal
Revenue Code, allowing refund to citizens of foreign countries
on a showing of reciprocity. With costs.
Under Article XII (4) of the RP-US Military Bases Agreement,
the Philippine Government agreed to exempt from payment of
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
vs. Exchange Commission to do business in the Philippines entered into Philippine income tax nationals of the United States, or
COURT OF APPEALS and a contract with the United States Government to transport military corporations organized under the laws of the United States,
COMMISSIONER OF household goods and effects of U.S. military personnel assigned residents in the United States in respect of any profit derived
INTERNAL REVENUE, to the Subic Naval Base. From the aforesaid contract, SEA-LAND under a contract made in the United States with the
respondents. derived an income for the taxable year 1984 amounting to Government of the United States in connection with the
P58,006,207.54. During the taxable year in question, SEA-LAND filed construction, maintenance, operation and defense of the
with the Bureau of Internal Revenue (BIR) the corresponding bases. It is obvious that the transport or shipment of
RP-US corporate Income Tax Return (ITR) and paid the income tax due
thereon of 1.5% as required in Section 25 (a)(2) of the National
household goods and effects of U.S. military personnel is
not included in the term "construction, maintenance,
MILITARY Internal Revenue Code (NIRC) in relation to Article 9 of the RP- operation and defense of the bases." Neither could the
US Tax Treaty, amounting to P870,093.12. Claiming that it paid the performance of this service to the U.S. government be
BASES aforementioned income tax by mistake, a written claim for refund was interpreted as directly related to the defense and security
AGREEMENT filed with the BIR on 15 April 1987. However, before the said claim for
refund could be acted upon by public respondent Commissioner of
of the Philippine territories.

Internal Revenue, petitioner-appellant filed a petition for review with WHEREFORE, the Court DENIES the petition for lack of
the CTA docketed as CTA Case No. 4149, to judicially pursue its merit.
claim for refund and to stop the running of the two-year prescriptive
period under the then Section 243 of the NIRC.
COMMISSIONER OF Petitioner, as the Commissioner of the Bureau of Internal Revenue Petitioner contends that Respondent filed The language used in Section 13 of Presidential Decree No.
INTERNAL REVENUE, (BIR), is responsible for the assessment and collection of all national according to well-established with the BIR an 1590, granting respondent tax exemption, is clearly all-
Petitioner, internal revenue taxes, fees, and charges, including the 10% doctrine, a tax refund, which is administrative inclusive. The basic corporate income tax or franchise tax
vs. Overseas Communications Tax (OCT), imposed by Section 120 of in the nature of a tax claim for refund paid by respondent shall be "in lieu of all other taxes, duties,
PHILIPPINE AIRLINES, the National Internal Revenue Code (NIRC) of 1997. For the period exemption, should be of the royalties, registration, license, and other fees and charges of
INC., Respondent. January to December 2001, the Philippine Long Distance Telephone construed strictissimi juris ₱202,471.18 any kind, nature, or description imposed, levied, established,
Company (PLDT) collected from respondent the 10% OCT on the against the taxpayer. OCT it alleged to assessed or collected by any municipal, city, provincial, or
amount paid by the latter for overseas telephone calls it had made have national authority or government agency, now or in the future
ALL-INCLUSIVE through the former. In all, PLDT collected from respondent the
amount of ₱202,471.18 as OCT for 2001.
erroneously paid x x x," except only real property tax. Even a meticulous
in 2001. In a examination of Presidential Decree No. 1590 will not reveal
EXEMPTION letter dated 4 any provision therein limiting the tax exemption of respondent
April 2003, to final withholding tax on interest income or excluding from
addressed to said exemption the OCT. Notably, PAL was owned and
petitioner, Ma. operated by the government at the time the franchise was
Stella L. Diaz last amended. It can reasonably be contemplated that PD
(Diaz), the 1590 sought to assist the finances of the government
Assistant Vice- corporation in the form of lower taxes. When the
President for respondent operates at a loss (as in the instant case), no
Financial taxes are due; in this [sic] instances, it has a lower tax liability
Planning & than that provided by Subsection (b).
Analysis of
respondent,
explained that
TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
the claim for When the claim for refund has clear legal basis and is
refund of sufficiently supported by evidence, as in the present case,
respondent then the Court shall not hesitate to grant the same.
was based on
its franchise,
Section 13 of
Presidential
Decree No.
1590, which
granted it (1)
the option to
pay either the
basic corporate
income tax on
its annual net
taxable income
or the two
percent
franchise tax
on its gross
revenues,
whichever was
lower; and (2)
the exemption
from all other
taxes, duties,
royalties,
registration,
license and
other fees and
charges
imposed by any
municipal, city,
provincial or
national
authority or
government
agency, now or
in the future,
except only real
property tax.
TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
Also invoking
BIR Ruling No.
97-947 dated 13
April 1994, Diaz
maintained that,
other than being
liable for basic
corporate
income tax or
the franchise
tax, whichever
was lower,
respondent was
clearly
exempted from
all other taxes,
including OCT,
by virtue of the
"in lieu of all
taxes" clause
in Section 13 of
Presidential
Decree No.
1590.
Respondent
alleged in its
Petition that per
its computation,
reflected in its
annual income
tax return, it
incurred a net
loss in 2001
resulting in zero
basic corporate
income tax
liability, which
was necessarily
lower than the
franchise tax
due on its gross
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
revenues.
Respondent
argued that in
opting for the
basic corporate
income tax,
regardless of
whether or not it
actually paid any
amount as tax, it
was already
entitled to the
exemption from
all other taxes
granted to it
PHILIPPINE LONG PLDT is a holder of a legislative franchise under Act No. 3436, as The tax exemption must be expressed in the statute in clear
DISTANCE TELEPHONE amended, to render local and international telecommunications language that leaves no doubt of the intention of the
COMPANY, INC., services. On August 24, 1991, the terms and conditions of its legislature to grant such exemption. And, even if it is granted,
Petitioners, franchise were consolidated under Republic Act No. 7082, Section 12 the exemption must be interpreted in strictissimi juris against
vs. of which embodies the so-called "in-lieu-of-all taxes" clause, the taxpayer and liberally in favor of the taxing authority.
PROVINCE OF LAGUNA whereunder PLDT shall pay a franchise tax equivalent to three
and MANUEL E. LEYCANO, percent (3%) of all its gross receipts, which franchise tax shall There is also a need to promote a level playing field in the
JR., in his capacity as the be "in lieu of all taxes". Meanwhile, or on January 1, 1992, Republic telecommunications industry. New entities must be granted
Provincial Treasurer of the Act No. 7160, otherwise known as the Local Government Code, took protection against dominant carriers through the
Province of Laguna, effect. Section 137 of the Code, in relation to Section 151 thereof, encouragement of equitable access charges and equal
Respondents. grants provinces and other local government units the power to access clauses in interconnection agreements and the strict
impose local franchise tax on businesses enjoying a franchise. policing of predatory pricing by dominant carriers. Equal
(GR No. 151899) By Section 193 of the same Code, all tax exemption privileges then access should be granted to all operators connecting into the
enjoyed by all persons, whether natural or juridicial, save those interexchange network. There should be no discrimination
expressly mentioned therein, were withdrawn, necessarily including against any carrier in terms of priorities and/or quality of
those taxes from which PLDT is exempted under the "in-lieu-of-all services. Nor does the term ‘exemption’ in § 23 of R.A. No.
EXEMPTION taxes" clause in its charter. Prior thereto, Congress, aiming to level 7925 mean tax exemption. The term refers to exemption
the playing field among telecommunication companies, enacted from certain regulations and requirements imposed by
FROM REG & Republic Act No. 7925, otherwise known as the Public the National Telecommunications Commission (NTC). For
REQ OF NTC Telecommunications Policy Act of the Philippines, which took effect
on March 16, 1995. To achieve the legislative intent, Section 23
instance, R.A. No. 7925, § 17 provides: ‘The Commission
shall exempt any specific telecommunications service from its
thereof, also known as the "most-favored treatment" clause, provides rate or tariff regulations if the service has sufficient competition
for an equality of treatment in the telecommunications industry. to ensure fair and reasonable rates or tariffs.’ Another
exemption granted by the law in line with its policy of
deregulation is the exemption from the requirement of
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
securing permits from the NTC every time a
telecommunications company imports equipment.

Indeed, both in their nature and in their effect there is no

difference between tax exemption and tax exclusion.
Exemption is an immunity or privilege; it is freedom from a
charge or burden to which others are subjected. Exclusion, on
the other hand, is the removal of otherwise taxable items from
the reach of taxation, e.g., exclusions from gross income and
allowable deductions. Exclusion is thus also an immunity or
privilege which frees a taxpayer from a charge to which others
are subjected. Consequently, the rule that tax exemption
should be applied in strictissimi juris against the taxpayer and
liberally in favor of the government applies equally to tax
exclusions. To construe otherwise the ‘in lieu of all taxes’
provision invoked is to be inconsistent with the theory that R.A.
No. 7925, § 23 grants tax exemption because of a similar grant
to Globe and Smart.
PHILIPPINE LONG In August 1995, the City of Bacolod, invoking its authority under
DISTANCE TELEPHONE Section 137, in relation to Section 151 and Section 193, supra, of the
COMPANY, INC., Local Government Code, made an assessment on PLDT for the
Petitioners, payment of franchise tax due the City. Complying therewith, PLDT
vs. began paying the City franchise tax from the year 1994 until the third
CITY OF BACOLOD, quarter of 1998, at which time the total franchise tax it had paid the
FLORENTINO T. GUANCO, City already amounted to ₱2,770,696.37. On June 2, 1998, the
in his capacity as the City Department of Finance through its Bureau of Local Government
Treasurer of Bacolod City, Finance (BLGF), issued a ruling to the effect that as of March 16,
and ANTONIO G. LACZI, in 1995, the effectivity date of the Public Telecommunications Policy Act
his capacity as the City Legal of the Philippines (Rep. Act. No. 7925), PLDT, among other
Officer of Bacolod City, telecommunication companies, became exempt from local franchise
Respondents. tax. It appears that RA 7082 further amending ACT No. 3436 which
granted to PLDT a franchise to install, operate and maintain a
GR No. 149179 telephone system throughout the Philippine Islands was approved on
August 3, 1991. Section 12 of said franchise, likewise, contains the
‘in lieu of all taxes’ proviso. On the basis of the aforequoted Section
23 of RA 7925, PLDT as a telecommunications franchise holder
becomes automatically covered by the tax exemption provisions of
RA 7925, which took effect on March 16, 1995. The controversy came
to a head-on when, sometime in 1999, PLDT applied for the issuance
of a Mayor’s Permit but the City of Bacolod withheld issuance thereof
pending PLDT’s payment of its franchise tax liability in the following
 TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
amounts: (1) ₱358,258.30 for the fourth quarter of 1998; and (b)
₱1,424,578.10 for the year 1999, all in the aggregate amount of
₱1,782,836.40, excluding surcharges and interest, about which
PLDT was duly informed by the City Treasurer via a 5th Indorsement
dated March 16, 1999 for PLDT’s "appropriate action".
ESSO STANDARD Claim for the refund of P722.84 paid in 1956 as special import tax on Petitioner's ground: The Petitioner is engaged in the industry of processing gasoline,
EASTERN, INC., petitioner- pump parts imported by petitioner. imported articles "consist of and manufacturing lubricating oil, grease and tin containers.
appellant, equipment and spare parts Petitioner owns gasoline stations with pumps, which are
vs. for its own exclusive use and leased to and operated by gasoline dealers. It sells gasoline
ACTING COMMISSIONER therefore were exempt from to these dealers. The pump parts imported by petitioner in
OF CUSTOMS, respondent- special import tax", by the 1956 were intended, installed and actually used by
appellee. terms of Section 6, Republic gasoline dealers in pumping gasoline from under around
Act 1394. tanks into customers' motor vehicles. These pump parts,
PUMP PARTS in other words, are used in the sale at retail of gasoline —
not by petitioner but by lessees of gasoline stations. In
this factual environment, it is quite evident that the pump parts
are not used in petitioner's industry of processing gasoline, or
manufacturing lubricating oil, grease and tin containers.

The drive of petitioner's argument is that marketing of its

gasoline product "is corollary to or incidental to its industrial
operations." But this contention runs smack against the
familiar rules that exemption from taxation is not favored, and
that exemptions in tax statutes are never presumed. Which
are but statements in adherence to the ancient rule that
exemptions from taxation are construed in strictissimi juris
against the taxpayer and liberally in favor of the taxing
authority. Tested by this precept, we cannot indulge in
expansive construction and write into the law an exemption
not therein set forth. Rather, we go by the reasonable
assumption that where the State has granted in express terms
certain exemptions, those are the exemptions to be
considered, and no more. Since the law states that, to be tax
exempt, equipment and spare parts should be "for the use of
industries", the coverage herein should not be enlarged to
include equipment and spare parts for use in dispensing
gasoline at retail. In comparable factual backdrop, this Court
has held that tax exemption in connection with the
manufacture of asbestos roof does not extend to the
installation thereof. Upon the facts and the law, we vote to
TITLE FACTS PETITIONER/PLAINTIFF/APELLANT’S CONTENTION RESPONDENT/DEFENDANT/APPELLEE’S CONTENTION RULING
affirm the decision of the Court of Tax Appeals under review.
Costs against petitioner. So ordered.