(case no.

252)

CARLOS SUPERDRUG CORPORATION v. DEPARTMENT OF SOCIAL WELFARE

AND DEVELOPMENT
GR Number 166494
June 29, 2007
Art. III
FACTS:
Republic Act 9257 was signed into law on February 26, 2004. It became effective on
March 21, 2004. On May 28, DSWD adopted and approved the IRR of RA 9257. On July 10, the
Drug Stores Association of the Philippines sent a query regarding the meaning of the tax
deduction under the Expanded Senior Citizens Act. The DOH issued an Administrative Order
ordering that 20% discount shall not be limited to the purchase of unbranded generic medicines
only but shall extend to both prescription and non-prescription medicines. Grant of 20%
discount shall be provided in the purchase of medicines from all establishments dispensing
medicines for the exclusive use of the senior citizen.
Petitioners assail the constitutionality of section 4(a) 1 of the act on the ground that it is
confiscatory, violates equal protection clause, and that it violates the guarantee that makes
essential goods, health, and other social services affordable to all people at affordable costs.
ISSUE:
Whether Section 4A of RA 9257 infringes on the property rights of the owners of drugstores
without just compensation.
HELD:
No. The Senior Citizens Act was enacted to maximize the contribution of senior citizens
to nation-building, and grant them benefits and privileges for their improvement and well-being.
To implement the said policy, the law grants them 20% discount for several services and
products. As a form of reimbursement, the establishments are extended a claim for tax
deductions.
The Court ruled that the law was a legitimate exercise of the police power of the State.
It is the power vested in the legislature for the pursuit of the general welfare of the people.
Property rights, though sheltered by due process, must yield to general welfare.
The loss of earnings and capital, as impleaded by the petitioners, is invalidated. In the
absence of evidence demonstrating the alleged confiscatory effect of the provision, there is no
basis for its nullification.
Petitioners have not been able to properly show whether the tax deduction scheme really
works greatly to their advantage or not. Petitioners have shown a computation but the Court rued
that it was flawed. The Court opined that while the Constitution protects property rights,
petitioners must accept the realities of business and the State, in the exercise of police
power, can intervene in the operations of a business which may result in an impairment of
property rights in the process.
1 SEC. 4. Privileges for the Senior Citizens. The senior citizens shall be entitled to the following:
(a) the grant of twenty percent (20%) discount from all establishments relative to the utilization of
services in hotels and similar lodging establishments, restaurants and recreation centers, and purchase of
medicines in all establishments for the exclusive use or enjoyment of senior citizens, including funeral and
burial services for the death of senior citizens;

Prepared by: Cecille Diane DJ. Mangaser

(case no. 252)

Prepared by: Cecille Diane DJ. Mangaser