LCA LINES | Volume II, Issue No. 9

8/12/2019 LCA LINES | Volume II, Issue No. 9

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the DST under the eDST

System, the DocumentaryStamp Tax Return (BIRForm 2000) shall be filedand the amount duethereon shall be paid thruthe eFPS/eFTIS for tax-payers/Authorized AgentBanks (AABs) on theirown tax liabilities, respec-tively. However, pay-ments of DST arising

from transfer of shares ofstocks classified as capitalasset or real property

classified as capital orordinary assets, shall notbe covered by these Reg-ulations.

Taxpayers that are man-dated to use and/or vol-untarily availing of theeDST System shall enrollin the said system, in ac-cordance with the provi-sions of the applicableregulations, circulars andorders. For juridical enti-

ties or persons, the en-rollment shall be made byauthorized natural per-sons specified in the com-panys board resolution.

For taxpayers under thejurisdiction of the LargeTaxpayers Service (LTS)and taxpayers adopting

REVENUE REGULA-TIONS NO. 7 - 2009

These Regulations arepromulgated to imple-ment the Electronic Docu-mentary Stamp Tax(eDST) System as re-placement of Documen-tary Stamp Tax ElectronicImprinting Machine(DSEIM) thereby amend-ing certain provisions ofRevenue Regulations No.

9-2000, as amended.

Any taxpayer belongingto the following industriesis mandated to use theweb-based eDST Systemin the payment/

remittance of its/his/herDST liabilities and theaffixture of the prescribeddocumentary stamp ontaxable documents, ex-cept those expressly ex-empted by the Commis-

sioner of Internal Reve-nue, on meritoriousgrounds:

1. Bank, quasi-bank ornon-bank financialintermediary, financecompany, or insur-ance, surety, fidelity,or annuity company;

2. Shipping and airline

companies;3. Pre-need company on

sale of pre-needplans, as providedunder Section 186 ofthe Tax Code;

4. Educational institutionin respect to the issu-ance of taxable certif-icates such as Diplo-ma, Transcript of Rec-ords, and other docu-ments taxable as cer-tificates under Section

188 of the Tax Code;and

5. Such other industriesas may be requiredby the Commissionerto use the web-based eDST Systemupon written notifica-tion therefore.

These Regulations shallalso apply to taxpayerswho, at their option,choose to pay their DST

liabilities thru the eDSTSystem.

Prior to the enrollment in

the eDST System, tax-payers availing thereof,whether on the mandato-ry or optional basis, shallbe duly enrolled underthe BIR eFPS. In paying

BIR ISSUANCES FOR THE MONTH OFSEPTEMBER

SEPTEMBER 2009VOLUME II ISSUE No. 9

LCALCALCA

LINESLINESLINESInside this issue:

Continuation of

BIR issuances

for the month

of September

2

Jurisprudence 7

JLs Corner 14


2/14

centralized DST paymentscheme, enrollment shall bemade by their respectiveHead Offices as the lone Ac-count Owner. On the other

hand, taxpayers with decen-tralized DST payment

scheme may, at their option,designate one or more de-partments/branches as au-thorized Account Owner.

Once registered under theeDST System, the AccountOwner may authorize asmany users he/she deems

necessary in the companysbusiness operations withoutthe need for prior approvalby the BIR.

REVENUE MEMORANDUMORDER NO. 28-2009

RMO No. 28-2009 issued onSeptember 18, 2009 adjuststhe reimbursable transporta-

tion allowance of RevenueOfficers, Collection Officers/Agents, Seizure Agents, Le-gal Officers/Trial Attorneyand Messengers/Liaison Of-ficers.

REVENUE MEMORANDUMORDER NO. 29-2009

This Order issued on Sep-tember 30, 2009 prescribesthe guidelines and proce-dures in the administrationof the mandatory WrittenCompetency Examination(WCE) for all Revenue Offic-ers of the Assessment Groupin order to enhance theircapabilities and competen-cies through appropriatetraining programs, and toeventually determine theirrespective places of assign-ment.

ternet Banking Facility(iAccess) where customerscan view, monitor andprint their transaction his-tory or enroll in their

Phone Banking

Facility (Phone Access) toinquire their deposit bal-ances, transactions and

request their bank state-ment. Moreover, accountholders may request theirdepositary branch for acopy of their bank state-ment but with a fee of P

20.00/page and holdingFee of P100.00, to be deb-ited from their account, ifnot claimed or picked-upwithin a month.

REVENUE MEMORANDUMCIRCULAR NO. 50-2009

RMC NO. 50-2009 issued onSeptember 16, 2009 reiter-ates the implementation ofRMC No. 19-2009 re: Tran-sition Procedures Relative tothe Issuance and Cancella-tion of Permit to Use CashRegister Machine (CRM),

Point-of-Sale (POS) Ma-chine, Special Purpose Ma-chine (SPM) and other simi-lar machines.

The said Circular directs allRegional Directors, RevenueDistrict Officers (RDOs),Chiefs of Large TaxpayerAssistance Division (LTAD) Iand II, Head of Large Tax-payer District Offices(LTDOs) and others con-cerned to implement strictly

the workaround procedureson the issuance of permitsprovided under RMC No. 19-2009 and to comply withthe three (3) working dayprocessing time from thereceipt of the complete re-quirements accompanyingthe application.

The receipt of the applica-

Page 2 LCA LINES

REVENUE MEMORANDUMCIRCULAR NO. 49-2009

RMC No. 49-2009 issued onSeptember 16, 2009 publish-es the full text of letter fromthe Land Bank of the Philip-pines (LBP) regarding thefeatures and charges in de-posit accounts which will beimplemented effective Octo-ber 1, 2009.

The following are the fea-

tures and charges in the de-

posit accounts of LBP effec-

tive October 1, 2009:

A. New Deposit Require-

ments of Regular Pass-

book (Peso) Savings Ac-

count:

INDIVIDUAL ACCOUNT

Accounts affected by thenew deposit requirements

have an option to increasetheir ADB to avoid servicecharges. Existing RegularPeso Savings Passbook Ac-counts can also be convert-ed to an ATM account on orbefore October 1, 2009.

B. LBP Fees and Charges:

Peso Savings Account,

Current Account, EasySavings Plus (ESP)

US Dollar Savings Ac-

countC. Issuance of Bank State-ment:

Effective October 2009, LBPshall no longer issue bankstatements for ATM savingsaccounts. Account holdersare advised to enroll theirATM accounts in LBPs In-


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tion via electronic mailmust be acknowledgedupon verification of thecorrectness, completeness

and validity of all infor-mation provided by theapplicant; otherwise, con-cerned revenue personnelmust specify the infor-mation needed to completethe application for the issu-ance of the Permit toUse.

On the part of the accredit-ed suppliers/taxpayer-users, no document is re-quired for their application

for registration of CRM/POS/SPM and other salesmachines and for subse-quent issuance of thePermit to Use. Only aSworn Statement (Annex Aof Revenue memorandumOrder No. 10-2005) is re-quired for submission bytaxpayer-users for the reg-istration of non-accreditedmachines.

Each permit must be

signed or approved by the

Page 3VOLUME II ISSUE No. 9

RDO/Chief of LTAD I & IIand LTDO where the tax-payer-user is registeredor where the machine/swill be used prior to theissuance of the said per-mit.

REVENUE MEMORAN-DUM CIRCULAR NO. 51

-2009

RMC No. 51-2009 issuedon September 16, 2009clarifies the requirementfor the submission ofSummary Lists of Sales(SLS)/Summary Lists ofPurchases (SLP); theimposition of penaltiesfor their non-submission;

the issuance of Subpoe-na Duces Tecum (SDT);and the imposition of

penalties for failure toobey summons, pursuantto Revenue Regulations(RR) No. 8-2002, as in-corporated in RR No. 16-2005, and RevenueMemorandum Order(RMO) No. 12-2009.

All VAT-registered per-

sons with total quarterlysales/ receipts (netof VAT) exceeding P

2,500,000.00

are required to sub-mit SLSs while all VAT-registered persons with total quarterly purchases(net of VAT) exceeding P 1,000,000.00 are re-quired to submit SLPs.

The quarterly SLS/SLP, whichever is applicable,

shall be submitted to the Revenue District Office

(RDO)/Large Taxpayers District Office (LTDO)/

Large Taxpayers Audit and Investigation Division

(LTAID) having jurisdiction over he concerned tax-

payer, on or before 35th day of the month following

the close of the taxable quarter (VAT calendar

quarter or VAT fiscal quarter).

Any taxpayer who, under established revenue rules

and regulations, fails to submit the required SLS/SLP, shall be subject to an administrative penalty inthe amount of P 1,000.00 for each such failure, inaccordance with the provisions of RR No. 8-2002,as incorporated in RR No. 16-2005. For this pur-pose, failure to supply the required information foreach buyer or seller of goods and services shallconstitute a single punishable act or omission. How-ever, the aggregate amount of penalties to be im-

CODE OFFICEA-1 Office of the

Senior DeputyCommissioner

A-1-1 Office of theDeputy Com-missioner,Operations

GroupA-1-2 Office of the

Deputy Com-

missioner,InformationSystemsGroup

A-1-3 Office of theDeputy Com-missioner,ResourceManagementGroup

A-1-4 Office of theDeputy Com-missioner,Legal and In-

spectionGroup

DepositRe-

quirement

Amount(P)

MinimumInitialDeposit

10,000

RequiredMinimumAverageDailyBalance

10,000

RequiredDailyBalanceto Earn

Interest

10,000

Features/ Fees Peso Ac-counts US$ Sav-ings Ac-

countFee For Falling Belowthe Required AverageDaily Balance (ADB)

P 200 $ 5

Closing Fee (within 30days from opening ofaccount)

P 200 P 200

Dormancy Fee P 200 $5Interbank ATM With-drawal Fee (includingCash Card)

P 10 -

Fee for Printing andReprinting SOA/BankStatement

P 20/page P 20/page

Holding fee for Re-quested Statement ofAccount (SOA)/BankStatements NotClaimed/Picked-upwithin a month

P 100 P 100


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Page 4 LCA LINES

posed for such failuresduring a taxable yearshall not exceed P

25,000.00, in observanceof Section 250 of the Na-tional Internal RevenueCode (NIRC), as amend-ed. In addition to admin-istrative penalties, the actof non-submission of anSLS/SLP in the formatprescribed by the Bureaushall be tantamount towillful failure to supplycorrect and accurate in-formation, and shall becriminally punishable un-

der Section 255 of theNIRC (as amended). Thesubmission of erroneous/incomplete/falsified infor-mation in a particularSLS/SLP shall be consid-ered as an act of non-submission, and thereforesubject to the aforesaidpenalties.Every instance of failure

on the part of the taxpay-

er to comply with the re-

quirement to submit the

SLS/SLP after due notice

shall be considered as

sufficient grounds for the

issuance of a Subpoena

Duces Tecum mandating

the immediate submission

of the aforesaid SLS/SLP.

The issuance of the SDT,

however, shall not be ne-

gated by mere payment

of the administrative pen-

alty. Moreover, upon sub-

mission of the required

SLS/SLP in compliance

with the SDT, the con-

cerned taxpayer must pay

a compromise penalty in

the amount of P

10,000.00 for each non-

submission of the re-

quired SLS/SLP, in ac-

cordance with the provi-

sions of RMO No. 12-

2009.

If a taxpayer still fails tosubmit the required SLS/SLP, in the format pre-scribed by the Bureau,despite the issuance ofan SDT, the RevenueDistrict Officer (RDO)/LTDO Head/LTAID Chiefconcerned shall recom-mend the filing of crimi-nal action against thetaxpayer, for violation of

Sec.255 (Failure to File

BIR Return, Supply Cor-rect and Accurate Infor-mation), as well as forviolation of Sec. 266(Failure to Obey Sum-mons). If the taxpayer

concerned is a corpora-tion, an association or ageneral co-partnership,the sanctions mandatedunder Sec. 256 (PenalLiability of Corporations)

of the NIRC shall likewisebe imposed and invoked

in the filing of a criminalcase against the taxpay-er.

The RDO/LTDO/LTAID

having jurisdiction over

the taxpayer who fails to

comply with the duly-

issued SDT shall forward

the necessary report to

the Regional Director

(Attn: The Chief, Legal

Division) or to the Assis-

tant Commissioner

(ACIR), Legal Service(Attn: The Chief, Prose-

cution Division), as the

case may be, attesting to

the taxpayers non-

compliance with the SDT

and recommending the

filing of a criminal case

against the taxpayer.

Thereafter, the Legal

Division of the concerned

Region or the Prosecu-

tion Division at the Na-tional Office, as the case

may be, shall be respon-

sible for the institution of

criminal action against

the taxpayer himself, or

in cases where the tax-

payer is a juridical entity,

the responsible officer of

the corporation/

association/general co-

partnership.

The late submission ofan SLS/SLP on or beforethe deadlines mandatedby the Bureau is consid-ered tantamount to non-submission of the saiddocument. Therefore thelate submission of anSLS/SLP is also subjectto administrative penal-ties in the amount of P1,000.00 for each latesubmission.

Compromise penalties

may be imposed, and the

Subpoena Duces Tecum

issued, for violations per-

taining to a period/

periods prior to the issu-

ance of RMO No. 12-

2009. However, such

actions cannot be con-

strued as a retroactive

implementation of the

RMO inasmuch as thesubmission of the re-

quired SLS/SLP has yet to

be complied with by the

concerned taxpayer.

Therefore, regardless of

the period(s) involved,

the taxpayer continues to

be in violation of existing

rules and regulations rela-

tive to the submission of

SLSs/SLPs. Moreover, RR

No. 8-2002, as incorpo-rated in RR No. 16-2005,

specifically states that:

Finally, the admin-

istrative penalty

shall be imposed at

all times, upon due

notice and demand

by the Commission-

er of Internal Reve-

nue. A Subpoena

Duces Tecum for thesubmission of the

required documents

shall be issued on

the second offense.

A third offense shall

set the motion for a

criminal prosecution

of the offend-

er. (Sec. 5 [Penalty

Provision], RR No. 8

-2002; Sec. 4. 114-

3. (i) [Penalty

Clause], RR No. 16-

2005)

The imposition of the ap-propriate penalties shallbe applicable for everynon-submission of a sum-mary List, whether it is anSLS or an SLP, in the for-


5/14


mat prescribed by theBureau. Likewise, eachnon-submission is consid-

ered as grounds for theissuance of an SDT.

The signing of SDT may

be delegated to the fol-

lowing revenue officials:

1. For the BIR National

Office

The ACIR, Legal Ser-

vice;

The HREA, Legal Ser-vice, or the concerned

HREA, Large Taxpay-

ers Service; or,

The concerned LTAID

Chief/TDO Head, as

may be specially au-

thorized, in writing,

by the Commissioner

2. For the Regional Offices

The Regional Director,

or in his/her absence,

the Asst. Regional

Director;

The chief, Legal Divi-

sion; or

The concerned Reve-

nue District Officer, as

may be authorized by

the Regional Director,

through the appropri-ate Regional Delega-

tion Order

RR No. 8-2002 (as incor-

porated in RR No. 16-

2005), mandates that 2

notices must be sent to

the taxpayer. The first

notice shall notify the tax-

payer of his/her failure

to submit the pertinent

SLS/SLP, as well as of

the imposition of the ad-ministrative penalty

ranging from P 1,000.00

to P 25,000.00 and shall

constitute the first of-

fense of the taxpayer.

The second notice shall

be sent upon the first

notice and shall contain a

warning that non-

compliance with the se-

cond notice shall be con-

sidered as the taxpayerssecond offense, and that

the appropriate SDT shall

be issued. Since there is

no provision in RMO No.

12-2009 that repeals this

requirement, it is there-

fore considered as valid

and applicable.

REVENUE MEMORAN-DUM CIRCULAR NO.

52-2009

RMC No. 52-2009 issuedon September 22, 2009circularizes the celebra-tion of the 20th NationalStatistics Month (NSM) inOctober, 2009.

REVENUE MEMORAN-

DUM CIRCULAR NO.47-2009

RMC 47-2009 publishesthe full text of CircularNo. 2009-002Reinstituting SelectivePre-Audit on GovernmentTransactions dated 18May 2009.

Pre-audit shall be selec-

tively reinstituted in na-

tional government agen-

cies (NGAs), local gov-ernment units (LGUs)

and government-owned

and controlled corpora-

tions (GOCCs) with origi-

nal charters, with any,

some or all of the follow-

ing transactions:

1. Cash advances;

2. Payments of salaries

and terminal leave

benefits;

3. Payments for infra-

structure projects;

4. Payments for road

right-of-way;

5. Payments for pro-

curement of capital

assets, goods and

services;

6. Payments made thru

automatic debit ad-

vice (ADA);

7. Release of funds to

NGOs/Pos;

8. Transfers of funds

between government

agencies subject to

the exceptions pro-

vided in the Circular;

9. Disbursements from

trust funds of LGUs,

as limited in the Cir-

cular;

10. Disposal of real prop-

erty and unservicea-

ble property, subject

to the limitations

provided in the Cir-

cular.

Subsequent identificationof the NGAs, LGUs andGOCCs and their respec-tive transactions that

may be included or ex-cluded in pre-audit shallproceed from the resultsof an evaluation of theinternal control systemput in place and operat-ing in each agency. Na-tional high schools,GOCCs audited under theteam approach and ba-

rangays shall be initiallyexempt from pre-audit.

Except for cash advancesfor payroll, intelligencefunds, petty cash fundsand those granted for

local travel expenses ofofficers and employees,all other cash advancesincluding those for for-eign travels funded outof the local funds regard-less of amount shall pass

through pre-audit.

The liquidation of cashadvances shall first be

audited and the corre-sponding Credit Noticeissued before the sameshall be taken up in thebooks.

Only the advance pay-ments granted to con-tractors as well as thefirst and last progress

billings of contracts forinfrastructure projects,the contract amount ofwhich falls within theaforecited threshold shallbe subject to pre-audit.First progress billing rep-resents claims made for

the first collection on thework accomplished in aparticular project. In the


6/14

Page 6 LCA LINES

payment for said ser-vices shall be subject topre-audit. First pay-ments involving exten-

sion of contracts shallalso be pre-audited.

First and last payments

of contracts entered into

through any of the vari-

ous modes of procure-

ment involving an

amount of at least P2

Million for NGAs, GOCCs,

cities within Metro Ma-

nila, other highly urban-

ized cities and first class

provinces; P1 Million for

provinces/cities below

first class; and

P500,000.00 for munici-

palities, shall be subject

to pre-audit. Procure-

ment between govern-

ment agencies or instru-

mentalities shall be ex-

empt from pre-audit.

For foreign-funded orlocally-funded infrastruc-ture projects that shallbe paid through Auto-matic Debit Advice(ADA), pre-audit shall beperformed on the docu-

ments to be submittedas basis for payment,such as but not limitedto the approved dis-bursement vouchers, ifapplicable, statement ofexpenditures, list of due

and demandable ac-counts payable and theirsupporting documents.For procurement paidthrough ADA, pre-auditshall be performed onthe approved disburse-ment voucher duly sup-ported by the regular

documentary require-ments for the specifictransaction.

All releases of funds toNGOs/Pos shall be sub-ject to pre-audit. Theaudit shall be carried outtaking into considerationthe requirements andguidelines provided inCOA Circular No. 2007-001 dated 25 October2007 and subsequentamendments thereto.No subsequent releasesshall be made unless

previous release is liqui-dated, and the liquida-tion documents are post-audited and properlytaken up in the books.

All transfers of funds ei-ther thru funding checkor bank transfer betweenand among bank ac-counts of governmentagencies or between dif-ferent bank accounts of

the same governmentagency regardless ofamount shall be subjectto pre-audit.

Fund transfers withinand between govern-ment banks, transfers offunds to addresses anemergency or calamity,releases of NCAs by theDepartment of Budgetand Management (DBM),

and releases of NTAsfrom department/centraloffices to operating unitsshall be exempt from pre-audit.

The pre-audit of trustfunds of LGUs shall only

pre-audit of the last pro-gress billing, all previouspayments shall be con-sidered.

All claims for road right-of-way shall be subjectto pre-audit taking intoconsideration the provi-sions of Republic Act(RA) No. 8974 [An ActTo Facilitate The Acquisi-tion Of Right-Of-Way ForNational GovernmentInfrastructure Projects]and its implementingrules and regulations.

Procurement of capitalassets shall include landand building. Procure-ment of goods and ser-vices includes acquisitionof supplies, material,general support services,

labor, equipment andmotor vehicles by thegovernment, regardlessof the source of fund.For this purpose, pro-curement of constructionmaterials for projects

implemented by admin-istration shall be treatedas procurement of goodsand services and shall besubject to the same tothe same rules providedin the Circular, takingthe total project cost andnot the individual trans-actions as basis of itscoverage in or exclusionfrom pre-audit.

General support services

shall include only thosewhich are recurring andfixed in nature, such asbut not limited to rent-als, janitorial and securi-ty services, and solidwaste management re-gardless of the amountinvolved. Only the first

cover disbursements ofthe trust funds receivedfrom the national gov-ernment or from GOCCs.

Pre-audit of disposal ofreal property shall coveronly those undertakenthrough negotiated salesinvolving an amount ofat least P1 Million. Ne-gotiated sale of acquiredassets of governmentfinancial institutionsamounting to at leastP50 Million, except thosedisposed to previous

owners in the exercise oftheir right of redemption,shall be subject to pre-audit. For unserviceableproperty and those nolonger needed, only ne-gotiated sales involvingan amount of at leastP500,000.00, whethervalued individually or bylot, shall be subject topre-audit.

REVENUE ADMINIS-TRATIVE ORDER NO.

13-2009

RAO No. 13-2009 issuedon September 18, 2009amends the title of Reve-nue Region No. 5, Valen-zuela to Revenue RegionNo. 5, Caloocan. Theamendment is in linewith the Bureaus effortsof bringing revenue ser-vice closer to the taxpay-

ing public by properidentification of the placeof business of RevenueRegion No. 5.


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JURISPRUDENCE

JOAQUIN P. OBIETAvs.

EDWARD CHEOKG.R. No. 170072, Sep-

tember 3, 2009

FACTS: The present

controversy sprung from

an intra-corporate dispute

filed by Edward Check

(Check) against Republic

Resources and Develop-

ment Corporation

(REDECO) and Joaquin P.

Obit (Obieta) in his capac-ity as its corporate secre-

tary seeking the issuance

of certificate of stocks at

the new par value in lieu

of his four REDECO street

certificates.

REDECO and Obieta, con-

tended that Check did not

present any proof that the

street certificates hadbeen endorsed or as-

signed to him. Further-

more, considering the

issuance of those certifi-

cates was not reflected in

the corporation's stock

and transfer book, they

validly denied Check's

request.

The Regional Trial Court

(RTC) held that those cer-

tificates were genuine.

Thus, Obieta acted negli-

gently in refusing Check's

request.

The appeal of REDECO

and Obieta was not per-

fected, thus, the RTC de-

cision became final and

executor. RTC issued awrit of execution and or-

dered Obieta to deliver his

Valley Golf and Country

Club (VGCC) stock certifi-

cate to the branch sheriff

so that it may be sold in

public auction. Obieta

refused; hence, he was

cited for contempt of

court.

Obieta assailed the orders

of the RTC (citing him for

contempt) via a petition

for certiorari and prohibi-

tion in the Court of Ap-

peals (CA).

CA held that Obieta was

solidarily liable with RE-

DECO.

ISSUE: Whether or not

the decision of the RTC

already attained finality

prior to the filing of the

appeal.

RULING: The RTC deci-

sion has already become

final and executor prior to

the filing of the appeal.

The appeal of the decision

of the RTC (holding

Obieta solidarily liable

with REDECO for the

judgment obligation) was

never perfected. Further-

more, neither REDECO

nor Obieta assailed the

orders dismissing the no-

tice of appeal. Thus, the

said decision became final

and executory.


8/14

Page 8 LCA LINES

PEOPLE OF THE PHIL-

IPPINES

vs.ANTONIO ORTIZ,

CHARITO CHAVEZ,

EDWIN DASILIO and

JERRY DOE

G.R. No. 179944, Sep-

tember 4, 2009

FACTS: Antonio Ortiz

(Ortiz), Charito Chavez

(Chavez), Edwin Dasilio

(Dasillo) and Jerry Doe

(Jerry) while all armed

with guns, by means of

force and violence against

the persons of spouses

BBB and AAA at their resi-

dence, carried away the

spouses personal belong-

ings and cash, but before

leaving with the loots,

Ortiz, Chavez, Dasillo,

and Jerry, with violence,

force and intimidation at

gun point succeeded in

having carnal knowledge

with AAA, one after the

other, in taking their

turns in satisfying their

carnal desires, against her

will, to the damage and

prejudice of the spouses.

Ortiz, Chavez and Dasilio

pleaded not guilty to the

charge.

The trial court rendered a

decision convicting Ortiz,

Chavez, Dasillo and Jerry

for the crime charged.

The Court of Appeals (CA)

affirmed the ruling of the

trial court with modifica-

tions.


the trial court erred in

finding Ortiz, Chavez,

Dasillo and Jerry guilty

beyond reasonable doubt

for Robbery with Multiple

Rape.

RULING: The trial court

did not err in finding

Ortiz, Chavez, Dasillo and

Jerry guilty beyond rea-

sonable doubt for Robbery

with Multiple Rape.

Robbery with rape is com-

mitted when the following

elements concur: (1) the

taking of personal proper-

ty is committed with vio-

lence against or intimida-

tion of persons; (2) the

property taken belongs to

another; (3) the taking is

characterized by intent to

gain or animus lucrandi;

(4) the robbery is accom-

panied by rape.

The first three elements

were proven by the estab-

lished facts in court.

Absent any showing that

the trial court overlooked

or misappreciated certain

JURISPRUDENCE


9/14

JURISPRUDENCE


CIVIL SERVICE COM-

MISSION

vs.

FATIMA A. MACUDG.R. No. 177531, Sep-

tember 10, 2009

FACTS: As a require-

ment for her appointment

as Teacher I of the De-

partment of Education,

Marawi City, Fatima A.

Macud (Macud) submitted

her Personal Data Sheet

(PDS). Her declaration in

the said PDS is that she

successfully passed the

Professional Board Exami-

nation for Teachers

(PBET).

Investigations were there-

upon conducted to verify

the eligibility of newly

appointed teachers. In-

vestigation showed that

Macud deliberately al-

lowed another person to

take the examination for

and in her behalf. There-

after, Macud was formally

charged with Dishonesty,

Grave Misconduct and

Conduct Prejudicial to the

Best Interest of the Ser-

vice before the regional

office and was later on

found guilty by the Civil

Service Commission Re-

gional Office XII (CSCRO

XXII). The Civil Service

eligibility of Macud was

revoked and cancelled.

Macuds motion for recon-

sideration of the Decision

was denied. Her appeal

to the CSC Central Office

was likewise denied.

The Court of Appeals (CA)

granted Macuds petition

and set aside the deci-

sions of the CSC Central

Office and CSCRO XII on

the sole ground of lack of

jurisdiction.

CSCs subsequent motion

for reconsideration was

denied by the CA.


the Court of Appeals erred

in ruling that the Investi-

gating Committee formed

under R.A. 4670 has ex-

clusive jurisdiction to try

the administrative case

against Macud.

RULING: The Court of

Appeals erred in ruling

that the Investigating

Committee formed under

R.A. 4670 has exclusive

jurisdiction to try the ad-

ministrative case against

Macud.

CSC is the constitutional

body charged with the

establishment and admin-istration of a career civil

service which embraces

all branches and agencies

of the government.

Article IX-B, Section 2(1)

of the 1987 Constitution

provides:

Section 2. (1) The

civil service em-braces all branch-es, subdivisions,instrumentalities,and agencies of theGovernment, in-

cluding government-owned or controlledcorporations withoriginal charters. xx x (emphasisours)

Section 3 of the same

Article further states:

Section 3. The Civil

Service Commission,

as the central per-

sonnel agency of the

Government, shall

establish a career

service and adopt

measures to pro-

mote morale, effi-

ciency, integrity,

responsiveness,

progressiveness,

and courtesy in

the civil service. It

shall strengthen the

merit and rewards

system, integrate all

human resources

development pro-

grams for all levels

and ranks, and insti-

tutionalize a man-

agement climate

conducive to public

accountability. It

shall submit to the

President and the

Congress an annual

report on its person-

facts or circumstances of

weight and influence

which, if considered,

would affect the result,there is no reason to

overturn the trial courts

finding of robbery which

is fully supported by the

evidence on record.

As to the attendant rape,

the testimony of AAA is

worthy of full faith and

credence. it is beyond

cavil that Ortiz, Chavez,

Dasillo and Jerry raped

AAA as an afterthought

after robbing valuable

items in the house. Alt-

hough the examination

of AAAs genital area re-

vealed no laceration in

her hymen, it is a settled

rule that laceration is not

an element of the crime

of rape. Simply put, theabsence of lacerations

does not negate rape.


10/14

JURISPRUDENCE

Page 10 LCA LINES

nel programs.

(emphasis ours)

Section 12. Powersand Functions. TheCommission shallhave the following

powers and func-tions:

(1) Administer andenforce the constitu-tional and statutoryprovisions on themerit system for alllevels and ranks inthe Civil Service;

(2) Prescribe, amendand enforce rules andregulations for carry-

ing into effect theprovisions of the CivilService Law and oth-er pertinent laws;xxx xxx xxx

(11) Hear and decideadministrative casesinstituted by orbrought before it di-rectly or on appeal,including contested

appointments, andreview decisions andactions of agenciesattached to itxxx xxx xxx

(14) Take appropri-ate action on all ap-pointments and otherpersonnel matters inthe Civil Service in-cluding extension ofservice beyond re-tirement age;

xxx xxx xxx

R.A. 4670 did not divest

the CSC of its inherent

power to supervise and

discipline all members of

the civil service, includ-

ing public school teach-

ers.

CSC has the authority to

directly institute proceed-

ings to discipline a gov-

ernment employee in or-

der to protect the integri-

ty of the civil service.

Indeed, where an admin-

istrative case involves the

alleged fraudulent pro-

curement of an eligibility

or qualification for em-

ployment in the civil ser-

vice, it is but proper that

the CSC would have juris-

diction over the case for it

is in the best position to

determine if there has

been a violation of civil

service rules and regula-

tions.

ILEANA DR.MACALINAO

vs.BANK OF THE PHILIP-PINE ISLANDS

G.R. No. 175490, Sep-tember 17, 2009

FACTS: I l eana

Macalinao (Macalinao)

was an approved card-

holder of BPI Mastercard,

one of the credit card

facilities of Bank of thePhilippine Islands (BPI).

Macalinao made some

purchases through the

use of the said credit

card and defaulted in

paying for said purchas-

es. She subsequently

received a letter from

respondent BPI demand-

ing payment.

Under the Terms and

Conditions Governing the

Issuance and Use of the

BPI Credit and BPI Mas-

tercard, the charges or

balance thereof remain-

ing unpaid after the pay-

ment due date indicated

on the monthly State-

ment of Accounts shall

bear interest at the rate

of 3% per month and an

additional penalty fee

equivalent to another

3% per month.

For failure of Macalinao

to settle her obligations,

BPI filed with Metropoli-

tan Trial Court (MeTC) of

a complaint for a sum of

money against her and

her husband, Danilo SJ.

Macalinao (Danilo).

BPI prayed for the pay-

ment of the amount due

plus 3.25% finance

charges and late pay-

ment charges equivalent

to 6% of the amount due

and an amount equiva-

lent to 25% of the total

amount due as attor-

neys fees, and of thecost of suit.

Macalinao and her hus-

band failed to file their

Answer.

MeTC ruled in favor of

BPI and orde red


band to pay the amount

due plus interest and

penalty charges of 2%

per month.


band appealed to the

Regional Trial Court

(RTC).


11/14

Page 11 LCA LINES

JURISPRUDENCE

Macalinao filed a petition

for review with the Court

of Appeals (CA), which

affirmed with modificationthe Decision of the RTC.

Macalinao filed a Motion

for Reconsideration but

the same was denied.


the reduction of interest

rate from 9.25% to 2%

should be upheld since

the stipulated rate of in-

terest was unconscionable

and iniquitous, and thus

illegal.

RULING: The stipulated

rate of interest is uncon-

scionable and iniquitous,

thus illegal.

Since the stipulation on

the interest rate of 36%per annum is void, it is as

if there was no express

contract thereon. Hence,

courts may reduce the

interest rate as reason

and equity demand. The

same is true with respect

to the penalty charge.

Art. 1229. The judge

shall equitably reduce

the penalty when the

principal obligation

has been partly or

irregularly complied

with by the debtor.

Even if there has been

no performance, the

penalty may also be

reduced by the courts

if it is iniquitous or

unconscionable.

In exercising this power

to determine what is in-

iquitous and unconscion-

able, courts must consid-

er the circumstances of

each case since what

may be iniquitous and

unconscionable in one

may be totally just and

equitable in another.

Thus, under the circum-

stances, the Court finds

it equitable to reduce the

interest rate pegged by

the CA at 1.5% monthly

to 1% monthly and pen-

alty charge fixed by the

CA at 1.5% monthly to

1% monthly or a total of

2% per month or 24%

per annum in line with

the prevailing jurispru-

dence and in accordance

with Art. 1229 of the

Civil Code.


12/14


JURISPRUDENCE

PHILIPPINE HEALTHCARE PROVIDERS,

INC.,vs.COMMISSIONER OF

INTERNAL REVENUE,

G.R. No. 167330, Sep-tember 18, 2009

FACTS: Philippine

Health Care Providers,

Inc. (PHCPI) is a domes-

tic corporation whose

primary purpose is to

establish, maintain, con-

duct and operate a pre-

paid group practice

health care delivery sys-

tem or a health mainte-

nance organization to

take care of the sick and

disabled persons enrolled

in the health care plan

and to provide for the

administrative, legal, and

financial responsibilities

of the organization. In-

dividuals enrolled in its

health care programs

pay an annual member-

ship fee and are entitled

to various preventive,

diagnostic and curative

medical services provid-

ed by its duly licensed

physicians, specialists

and other professional

technical staff participat-

ing in the group practice

health delivery system at

a hospital or clinic

owned, operated or ac-

credited by it.

The Commissioner of

Internal Revenue [CIR]

sent a formal demandletter and the corre-

sponding assessment

notices to PHCPI de-

manding the payment of

deficiency taxes [value-

added tax (VAT) and

documentary stamp tax

(DST)], including sur-

charges and interest, for

the taxable years 1996

and 1997.

PHCPI protested the as-

sessment. As the CIR

did not act on the pro-

test, PHPCI filed a peti-

tion for review in the

Court of Tax Appeals

(CTA) seeking the can-

cellation of the deficiency

VAT and DST assess-

ments.

CTA rendered a decision,

ordering PHCPI to pay

the deficiency VAT taxes

for taxable years 2006

and 2007. The deficien-

cy DST assessment for

taxable years 1996 and

1997 was cancelled and

set aside.

CIR appealed the CTA

decision to the Court of

Appeals (CA) insofar as it

cancelled the DST as-

sessment. The petition

for review was granted.

ISSUES: 1. Whether

or not PHCPI, as an HMO

is engaged in the busi-

ness of insurance duringtaxable years 1996 and

1997.

2. Whether or not the

PHCPI is liable to pay

DST under Section 185

of the National Internal

Revenue of 1997.

RULING: As to the first

issue, PHCPI is not en-

gaged in the business of

insurance during taxable

years 1996 and 1997.

HMOs are not in the in-

surance business. One

test that they have ap-

plied is whether the as-

sumption of risk and in-

demnification of loss

(which are elements of

an insurance business)

are the principal object

and purpose of the or-

ganization or whether

they are merely inci-

dental to its business. If

these are the principal

objectives, the business

is that of insurance. But

if they are merely inci-

dental and service is the

principal purpose, then

the business is not insur-

ance.

The main difference be-

tween an HMO and an

insurance company is

that HMOs undertake to

provide or arrange for the

provision of medical ser-

vices through participat-ing physicians while insur-

ance companies simply

undertake to indemnify

the insured for medical

expenses incurred up to a

pre-agreed limit.

Even if PHCPI assumes

the risk of paying the cost

of these services even if

significantly more than

what the member has

prepaid, it nevertheless

cannot be considered as

being engaged in the in-

surance business.

A substantial portion of

PHCPIs services covers

preventive and diagnostic

medical services intended

to keep members from

developing medical condi-

tions or diseases. As an

HMO, it is its obligation to

maintain the good health

of its members. Accord-

ingly, its health care

programs are designed

to prevent or to mini-

mize the possibility of

any assumption of risk

on its part.Thus, its un-dertaking under its agree-

ments is not to indemnify

its members against any

loss or damage arising

from a medical condition

but, on the contrary, to

provide the health and

medical services needed


13/14

JURISPRUDENCE

to prevent such loss or

damage. Therefore, since

it substantially provides

health care services ra-ther than insurance ser-

vices, it cannot be consid-

ered as being in the insur-

ance business.

With regard to the second

issue, PHCPI is not liable

to pay DST under Section

185 of the National Inter-

nal Revenue of 1997.

When the law imposing

the DST was first passed,

HMOs were yet unknown

in the Philippines. How-

ever, when the various

amendments to the DST

law were enacted, they

were already in existence

in the Philippines and the

term had in fact already

been defined by RA 7875.

If it had been the intent of

the legislature to impose

DST on health care agree-

ments, it could have done

so in clear and categorical

terms. It had many op-

portunities to do so. But

it did not. The fact that

the NIRC contained no

specific provision on the

DST liability of health care

agreements of HMOs at a

time they were already

known as such, belies any

legislative intent to im-

pose it on them. As a

matter of fact, PHCPI

was assessed its DST

liability only on Janu-

ary 27, 2000, after

more than a decade inthe business as an

HMO.

Considering that Section

185 did not change since

1904 (except for the rate

of tax), it would be safe

to say that health care

agreements were never,

at any time, recognized

as insurance contracts or

deemed engaged in the

business of insurance

within the context of the

provision.

Taking into account that

health care agreements

are clearly not within the

ambit of Section 185 of

the NIRC and there was

never any legislative in-

tent to impose the same

on HMOs like PHCPI, the

same should not be arbi-

trarily and unjustly in-

cluded in its coverage.


14/14

Page 14

LCA LINES

Www.lagundi-caronan-assoc.com

SERVINGYOUR

NEEDSREALIZING

YOUR

DREAMSSERVINGYOURNEEDS

REALIZINGYOURD

REAMS

LAGUNDI-CARONAN AND ASSOCIATES

For weeks six-year old JL kept telling hisfirst grade teacher about the baby brother or sister

was expected at his house.

One day, his mother allowed JL to feel the movementsof the unborn child.

JL was obviously impressed, but made no comment.

Furthermore, he stopped telling his teacher aboutthe impending event.

The teacher finally sat the boyon her lap and said;

JL, whatever has become of that baby brother or sister

you were expecting at home?

JL burst into tears and confessed,I think mommy ate it!

LAGUNDI-CARONAN AND ASSOC.Rhen Square Bldg

Carig SurTuguegarao City

Documents

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