DELA CRUZ VS PARAS

Facts:
1. Assailed was the validity of an ordinance which prohibit the operation of night clubs.
Petitioners contended that the ordinance is invalid, tainted with nullity, the municipality
being devoid of power to prohibit a lawful business, occupation or calling. Petitioners at the
same time alleging that their rights to due process and equal protection of the laws were
violated as the licenses previously given to them was in effect withdrawn without judicial
hearing.
2. RA 938, as amended, was originally enacted on June 20, 1953. It is entitled: "An Act Granting
Municipal or City Boards and Councils the Power to Regulate the Establishments,
Maintenance and Operation of Certain Places of Amusement within Their Respective
Territorial

Jurisdictions.'

The first section reads, "The municipal or city board or council of each chartered city shall
have the power to regulate by ordinance the establishment, maintenance and operation of
night clubs, cabarets, dancing schools, pavilions, cockpits, bars, saloons, bowling alleys,
billiard pools, and other similar places of amusement within its territorial jurisdiction:
On May 21, 1954, the first section was amended to include not merely "the power to
regulate, but likewise "Prohibit ... " The title, however, remained the same. It is worded
exactly as RA 938.
3. As thus amended, if only the said portion of the Act was considered, a municipal council may
go as far as to prohibit the operation of night clubs. The title was not in any way altered. It
was not changed one bit. The exact wording was followed. The power granted remains that
of regulation, not prohibition.
4.

Petitioners contended that RA 938 which prohibits the operation of night clubs would give
rise to a constitutional question. The lower court upheld the constitutionality and validity of
Ordinance No. 84 and dismissed the cases. Hence this petition for certiorari by way of
appeal.
ISSUE: Whether or not the ordinance is valid
NO. It is unconstitutional. It undoubtly involves

a measure not embraced within the

regulatory power but an exercise of an assumed power to prohibit.

1. The Constitution mandates: "Every bill shall embrace only one subject which shall be
expressed in the title thereof. "Since there is no dispute as the title limits the power to
regulating, not prohibiting, it would result in the statute being invalid if, as was done by the
Municipality of Bocaue, the operation of a night club was prohibited. There is a wide gap
between the exercise of a regulatory power "to provide for the health and safety, promote
the prosperity, and improve the morals, in the language of the Administrative Code, such
competence extending to all "the great public needs.
2. In accordance with the well-settled principle of constitutional construction that between two
possible interpretations by one of which it will be free from constitutional infirmity and by
the other tainted by such grave defect, the former is to be preferred. A construction that
would save rather than one that would affix the seal of doom certainly commends itself.

3. Under the Local Govt Code, it is clear that municipal corporations cannot prohibit the
operation of night clubs. They may be regulated, but not prevented from carrying on their
business. It would be, therefore, an exercise in futility if the decision under review were
sustained. All that petitioners would have to do is to apply once more for licenses to operate
night clubs. A refusal to grant licenses, because no such businesses could legally open,
would be subject to judicial correction. That is to comply with the legislative will to allow the
operation and continued existence of night clubs subject to appropriate regulations. In the
meanwhile, to compel petitioners to close their establishments, the necessary result of an
affirmance, would amount to no more than a temporary termination of their business.
4. Herein what was involved is a measure not embraced within the regulatory power but an
exercise of an assumed power to prohibit.
TOPIC: Appropriation Laws
DOCTRINE:
CASE Number (including date): GR 118303; Jan 31, 1996
CASE Name: Alvarez v. Guingona Jr.
Ponente: Hermosisima Jr.

FACTS

petitioners assail the validity of RA 7720: An Act Converting the Municipality of

Santiago, Isabela into an Independent Component City to be known as the City of
Santiago
o mainly because the Act allegedly did not originate exclusively in the
House of Representatives as mandated by Section 24, Article VI of the
1987 Constitution.
o that the Municipality of Santiago has not met the minimum average annual
income required
chronicle of the metamorphosis of House Bill No. 8817 into Republic Act No. 7720:
o (important) April 18, 1993, HB No. 8817 was filed (act was entitled
the same as that of RA 7720) in the house of representatives
o May 19, 1993, June 1, 1993, November 28, 1993, and December 1, 1993,
public hearings
o December 9, 1993: The committee submitted to the House a favorable report,
with amendments
o December 13, 1993, HB No. 8817 was passed by the House of
Representatives on Second Reading
o December 17, 1993 was approved on Third Reading
o January 28, 1994, HB No. 8817 was transmitted to the Senate.
o (Important) May 19, 1993: counterpart of HB No. 8817, Senate Bill
No. 1243 (same title as HB8817 and RA 7720) was filed in the Senate
just after the House of Representatives had conducted its first public
hearing on HB No. 8817.
ISSUE

WON RA 7720 is valid considering that the Senate passed SB No. 1243, its own
version of HB No. 8817, Republic Act No. 7720 can be said to have originated in
the House of Representatives?
HELD: YES
RATIO:

it cannot be denied that HB No. 8817 was filed in the House of Representatives first
before SB No. 1243 was filed in the Senate

HB No. 8817, was the bill that initiated the legislative process that culminated in the
enactment of Republic Act No. 7720.
No violation of Section 24, Article VI, of the 1987 Constitution is perceptible under the
circumstances attending the instant controversy.
Presumption of validity there must be enough proof the RA 7720 is unconstitutional
but there was none

(NOT IMPORTANT) Whether or not the IRA (internal revenue allotments) should be included in
the computation of an LGUs income.
HELD: YES
RATIO:

The IRAs are items of income because they form part of the gross accretion of the
funds of the local government unit.
The IRAs regularly and automatically accrue to the local treasury without need of any
further action on the part of the local government unit.
o They thus constitute income which the local government can invariably rely
upon as the source of much needed funds.

RULING:
WHEREFORE, the instant petition is DISMISSED for lack of merit with costs against
petitioners.
Topic

: Requirement as to Bills Requirement as to Certain Laws (Appropriation

Laws)

Case Number

: G.R. No. 94571 (April 22, 1991)

Case Name : Guingona vs. Carague

Ponente
: Gancayo
FACTS

The case involves a petition assailing the constitutionality of the automatic

appropriation for debt service in the 1990 budget.
1990 Budget consists of:
o P98.4 Billion in automatic appropriation. Appropriations for Debt Service
is P86.8 Billion.
o P155.3 Billion appropriated under Republic Act No. 6831 or the General
Appropriations Act. Appropriations for the Department of Education,
Culture and Sports (DECS) is P27 Billion.
The abovementioned automatic appropriation for debt service is authorized
by the following decrees issued by ex Pres Marcos:
o P.D. No. 81 (Amending Certain Provisions of RA 4860 as Amended (Re:
Foreign Borrowing Act)
o P.D. No. 1177 (Revising the Budget Process in Order to Institutionalize the
Budgetary Innovations of the New Society), and
o P.D. No. 1967 (An Act Strengthening the Guarantee and Payment Positions of
the Republic of the Philippines on Its Contingent Liabilities Arising out of
Relent and Guaranteed Loan by Appropriating Funds For The Purpose)
Petitioners seek to:
o Declare P.D. No. 81, P.D. 1177, and P.D. No. 1967 as unconstitutional
on the following grounds:
violative of Art XIV Sec 5 (5) of the 1987 Constitution.
inoperative under 1987 Constitution
violative of Art VI Sec 29 (1) of the 1987 Constitution
o Restrain the disbursement for debt service under the 1990 budget
pursuant to said decrees.
ISSUES

W/N petitioners have standing to file the petition.

W/N SC has jurisdiction to review the petition.
W/N the P86.8 Billion appropriation for debt service is violative of Art XIV
Sec 5 (5) of the 1987 Constitution (appropriation for debt service > appropriation
for DECS).
W/N P.D. No. 81, P.D. No. 1177, and P.D. No. 1967 are still operative under
the 1987 Constitution.
W/N said decrees are violative of Art VI Sec 29 (1) of the 1987 Constitution
(there is undue delegation of legislative power to the president).
HELD
YES. Petitioners, as senators of the Philippines, may file such suit where a
constitutional issue is raised. Indeed, even a taxpayer has personality to restrain
unlawful expenditure of public funds.

YES. Respondents argue that the issue is political in nature and shall be left to the
judgement of the legislative. However, SC held that there is a justiciable
controversy following the issues raised by the petitioners with regard to
the constitutionality of P.D. No. 81, P.D. No. 1177, and P.D. No. 1967.
o Gonzales vs Macaraig: Issue was the unconstitutionality of the presidential
veto of certain provision of the GAA of 1990, R.A. No. 6831. SC held there was
a justiciable controversy with the Senate maintaining that the President's veto
is unconstitutional and that charge being controverted.

NO. While said provision mandates the Congress to "assign the highest
budgetary priority to education", it does not follow that it cannot/should not
respond to the imperatives of the national interest and act for the
attainment of other state policies or objectives. In providing higher
appropriations for debt services, Congress is protecting the credit standing
of the country, given that the previous administration left the country with
enormous debt.

YES. SC held that said decrees are still operative even after the ousting of
Pres. Marcos (i.e. not violative of Art XVIII Sec 3). Art VI Sec 24 and 27
(requiring all appropriations authorizing increase of debt to be passed by
Congress and approved by the President) are also not applicable to the
case.
o On effectivity even after the ousting of Pres. Marcos:
SC: The framers intent in adopting Art VIII Sec 3 is to preserve
the social order so that legislation by then Pres Marcos may be
recognized and remain in force unless inconsistent with the
Constitution or, are otherwise amended, repealed or revoked.

The decrees show the clear intent that the amounts needed to cover
the payment of foreign loans should be made available when they shall
become due precisely without the necessity of periodic enactments of
separate laws appropriating funds therefor, since both the periods and
necessities are incapable of determination in advance. The claim that
payment of the loans and indebtedness is conditioned upon
the continuance of the person of President Marcos and his
legislative power goes against the intent and purpose of the
law.
On Art VI Sec 24 and 27 not being applicable to the case.
SC: Framers refer to appropriation measures that are still to be
passed by Congress, not those already existing, such as the
said decrees.

NO. SC deemed the decrees to be complete and have provided sufficient

standards therein. The legislative intention is clear the amount needed
should be automatically set aside in order to enable the country to pay the
principal, interest, taxes and other charges when they shall become due
without the need to enact a separate law appropriating funds therefor as the need
arises. Although the amounts are not stated specifically, such amounts are
limited to the principal, interest, taxes and other charges (i.e. there is
sufficient standard).

RULING:
WHEREFORE, the petition is DISMISSED, without pronouncement as to costs.

Relevant Law/s:
Art VI Sec 24 and 27
Sec 24. All appropriation, revenue or tariff bills, bills authorizing increase of the public debt,
bills of local application, and private bills shall originate exclusively in the House of
Representatives, but the Senate may propose or concur with amendments.
Sec 27. (1) Every bill passed by the Congress shall, before it becomes a law, be presented to
the President. xxx
(2) The President shall have the power to veto any particular item or items in an
appropriation, revenue, or tariff bill, but the veto shall not affect the item or items to which
he does not object.

Art VI. Sec 29 (1). No money shall be paid out of the Treasury except in pursuance of an
appropriation made by law.
Art XIV Sec 5 (5). The State shall assign the highest budgetary priority to education and
ensure that teaching will attract and retain its rightful share of the best available talents
through adequate remuneration and other means of job satisfaction and fulfillment.
Art XVIII Sec 3. All existing laws, decrees, executive orders, proclamations, letters of
instructions, and other executive issuances not inconsistent with this Constitution shall
remain operative until amended, repealed, or revoked.

The Province Of Abra vs. Honorable Harold M. Hernando

[G.R. No. L-49336. August 31, 1981]
Digest by: BONAVENTE, Arianne
PONENTE: Fernando, J.:
FACTS:
The Province of Abra sought to tax the properties of the Roman Catholic Bishop, Inc. of
Bangued. Judge Hernando dismissed the petition of Abra without hearing its side. Hernando
ruled that there is no question that the real properties sought to be taxed by the Province of
Abra are properties of the respondent Roman Catholic Bishop of Bangued, Inc. Likewise,
there is no dispute that the properties including their produce are actually, directly and
exclusively used by the Roman Catholic Bishop of Bangued, Inc. for religious or charitable
purposes. The proper remedy of the petitioner is appeal and not this special civil action.
ISSUE:
Whether or not the properties of the church (in this case) is exempt from taxes.
HELD:
The petition must be granted.
1. Respondent Judge would not have erred so grievously had he merely compared the
provisions of the present Constitution with that appearing in the 1935 Charter on the tax
exemption of lands, buildings, and improvements. There is a marked difference. Under the
1935 Constitution: Cemeteries, churches, and parsonages or convents appurtenant thereto,
and all lands, buildings, and improvements used exclusively for religious, charitable, or
educational purposes shall be exempt from taxation. The present Constitution added
charitable institutions, mosques, and non-profit cemeteries and required that for the
exemption of :lands, buildings, and improvements, they should not only be exclusively
but also actually and directly used for religious or charitable purposes. The Constitution is
worded differently. The change should not be ignored. It must be duly taken into
consideration. Reliance on past decisions would have sufficed were the words actually as
well as directly not added. There must be proof therefore of the actual and direct use of
the lands, buildings, and improvements for religious or charitable purposes to be exempt
from taxation. According to Commissioner of Internal Revenue v. Guerrero: From 1906, in
Catholic Church v. Hastings to 1966, in Esso Standard Eastern, Inc. v. Acting Commissioner
of Customs, it has been the constant and uniform holding that exemption from taxation is
not favored and is never presumed, so that if granted it must be strictly construed against
the taxpayer. Affirmatively put, the law frowns on exemption from taxation, hence, an
exempting provision should be construed strictissimi juris. In Manila Electric Company v.
Vera, a 1975 decision, such principle was reiterated, reference being made to Republic Flour
Mills, Inc. v. Commissioner of Internal Revenue; Commissioner of Customs v. Philippine
Acetylene Co. & CTA; and Davao Light and Power Co., Inc. v. Commissioner of Customs.

2. Petitioner Province of Abra is therefore fully justified in invoking the protection of

procedural due process. If there is any case where proof is necessary to demonstrate that
there is compliance with the constitutional provision that allows an exemption, this is it.
Instead, respondent Judge accepted at its face the allegation of private respondent. All that
was alleged in the petition for declaratory relief filed by private respondents, after
mentioning certain parcels of land owned by it, are that they are used actually, directly and
exclusively as sources of support of the parish priest and his helpers and also of private
respondent Bishop. In the motion to dismiss filed on behalf of petitioner Province of Abra,
the objection was based primarily on the lack of jurisdiction, as the validity of a tax
assessment may be questioned before the Local Board of Assessment Appeals and not with
a court. There was also mention of a lack of a cause of action, but only because, in its view,
declaratory relief is not proper, as there had been breach or violation of the right of
government to assess and collect taxes on such property. It clearly appears, therefore, that
in failing to accord a hearing to petitioner Province of Abra and deciding the case
immediately in favor of private respondent, respondent Judge failed to abide by the
constitutional command of procedural due process.
The petition is granted and the resolution of June 19, 1978 is set aside. Respondent Judge, or
who ever is acting on his behalf, is ordered to hear the case on the merit.
TOPIC: Tax laws
DOCTRINE: Tax exemption does not pertain only to organizations exclusively
devoted to one purpose (religious, charitable, educational), but may also pertain
to organizations with a combination of two or three or more of the purposes.
CASE Number: G.R. No. L-7988
January 19, 1916
CASE Name: THE YOUNG MEN'S CHRISTIAN ASSOCIATION OF MANILA (YMCA) vs.
THE COLLECTOR OF INTERNAL REVENUE
Ponente: Moreland, J.
FACTS
YMCA claims exemption from taxation on the ground that it is a religious, charitable
and educational institution combined.
While it appears that the association is not exclusively religious or charitable or
educational, it is demonstrated that it is a happy combination of all three, giving to
its membership the religious opportunities of the church, the educational
opportunities of the school and the blessings of charity where needed without the
recipient feeling or even knowing that he is the object of charity.
o Educational the aim of this department is to furnish, at much less than cost,
instruction in subjects that will greatly increase the mental efficiency and
wage-earning capacity of young men, prepare them in special lines of
business and offer them special lines of study.
o Religious While the association is nonsectarian, it is preeminently religious;
and the fundamental basis and groundwork is the Christian religion. All of the
officials of the association are devoted Christians, members of a church, and
have dedicated their lives to the spread of the Christian principles and
building of Christian character.
o Charitable It makes no profit on any of its activities. The professors and
instructors in all departments serve without pay and freely give of their time
and ability to further the purposes of the institution. The chief secretary and
his assistant receive no salary from the institution. Whatever they are paid
comes from the United States.
It is claimed, however, that the institution is run as a business in that it keeps a
lodging and boarding house. It may be admitted that there are 64 persons occupying
rooms in the main building as lodgers or roomers and that they take their meals at
the restaurant below.
Timeline:
1898 Along with the US Army occupation of the Philippines came the Young Mens
Christian Association.
1905 When the large body of troops in Manila was removed to permanent quarters
at Fort William McKinley in February, an independent association for Manila was
organized under the direction of the Army and navy departments. After which, the
directors made a formal request to the international committee of the Young Men's
Christian Association in New York City for the assistance and cooperation of its foreign
department.
1907 - Mr. John R. Mott, general secretary of the foreign department, visited Manila.
There they had a conference wherein it was decided to conduct a campaign to secure
funds for an adequate and permanent association. He guaranteed P170,000 for the

construction of the building in the name of the international committee and friends in
America.
February 15, 1907 the campaign for funds started in the Philippines.
March 15, 1907 they were able to raise P83,000. Nearly a thousand contributed.
June 1907 the YMCA received character and was incorporated under the Philippine
law.
January 8, 1908 the building contract was signed
July 10, 1908 first cornerstone was laid with proper ceremonies
October 20, 1909 it was finished.
Building deets: (for the specifics, read the original ;>)
Located in Calle Concepcion Ermita
It was composed of 3 parts:
o Main structure: center part, 3-stories high; includes a reception hall, social hall
and game rooms, lecture room, library, reading room and rooming apartments
o Left wing: kitchen and servants quarters.
o Right wing: known as the athletic building, where the bowling alleys,
swimming pool, locker rooms and gymnasium-auditorium are located;
ISSUES
Whether or not the building and grounds of the Young Men's Christian Association
of Manila are subject to taxation, under section 48 of the charter of the city of
Manila
HELD (including the Ratio Decidendi)
No. The purpose of the lodging was not to make money, but rather, as a very efficient
means of maintaining the influence of the institution over its membership; and
thereby to prevent, as far as possible, the opportunities which vice president to
young men in foreign countries who lack home or other similar influences.
The building and the grounds, from end to end, are devoted exclusively to the
purposes stated in the constitution of the association.
It is the belief of the Young Men's Christian Association that a Christian man, a man of
moral sentiment and firm moral fiber, is yet a better man for being also all-round
man one who is sound not only according to Christian principles and the highest
moral conceptions, but physically and mentally; whose body and mind act in
harmony and within the limits which the rights of others set; who are gentleman in
physical and mental struggles, as well as in religious service; who have self-respect
and self-restraint; who can hit hard and still kindly; who can lose without envy; who
can congratulate his conqueror with sincerity; who can vie without temper, contend
without malice, concede without regret; who can win and still be generous, in
short, one who fights hard but square. To the production of such men the association
lends all its efforts, husbands all its resources.
There is no doubt about the correctness of the contention that an institution must
devote itself exclusively to one or the other of the purpose mentioned in
the statute before it can be exempt from taxation; but the statute does not
say that it must be devoted exclusively to any one of the purposes therein
mentioned. It may be a combination of two or three or more of those purposes and
still be entitled to exempt.
RULING:
The judgment appealed from is reversed and the cause remanded with instructions to enter
a judgment against the city of Manila and in favor of the Young Men's Christian Association
of Manila in the sum of P6,221.35. Without costs in this instance. So ordered.

DISSENTING OPINION | (Carson, J.)

He was convinced that the statue exempting individuals and certain organizations from tax
should be strictly construed. He cited Mr. Justice Johnson in his dissent in Roman Catholic
Church vs. Hastings and City of Manila, stating:
"It is the theory of the Government that all property within the State held by
individuals or corporations should contribute equally, in portions to its value to the
support of the Government, in return for the protection which such property receives at
the hands of the Government. This being the policy of the Government, a law which
relieves any property from this burden should be strictly construed, to the end that no
individual or corporation shall be relieved from bearing his or its full share of the
burdens of taxation unless the law expressly so provides. This exemption should not be
allowed by any strained or unnatural interpretation of law."

Bishop of Nueva Segovia v. Provincial Board, Ilocos Norte [GR 27588, 31 December
1927] En Banc, Avancena (J): 5 concur Facts: The Roman Catholic Apostolic Church,
represented by the Bishop of Nueva Segovia, possesses and is the owner of a parcel of land
in the municipality of San Nicolas, Ilocos Norte, all four sides of which face on public streets.
On the south side is a part of the church yard, the convent and an adjacent lot used for a
vegetable garden, containing an area of 1,624 square meters, in which there is a stable and
a well for the use of the convent. In the center is the remainder of the churchyard and the
church. On the north side is an old cemetery with two of its walls still standing, and a portion
where formerly stood a tower, the base of which may still be seen, containing a total area of
8,955 square meters. As required by the provincial board, the Church paid on 3 July 1925,
under protest, the land tax on the lot adjoining the convent and the lot which formerly was
the cemetery with the portion where the tower stood. The Church filed an action for the
recovery of the sum paid by it to Board by way of land tax, alleging that the collection of this
tax is illegal. The lower court absolved the Board from the complaint in regard to the lot
adjoining the convent and declared that the tax collected on the lot, which formerly was the
cemetery and on the portion where the tower stood, was illegal. Both parties appealed from
this judgment. Issue: Whether the churchyard, the adjacent lot used for a vegetable garden,
and the old cemetery, besides the church and the convent, are exempt from land taxes.
Held: The exemption in favor of the convent in the payment of the land tax (sec. 344 [c]
Administrative Code) refers to the home of the priest who presides over the church and who
has to take care of himself in order to discharge his duties. It therefore must, in this sense,
include not only the land actually occupied by the church, but also the adjacent ground
destined to the ordinary incidental uses of man. Except in large cities where the density of
the population and the development of commerce require the use of larger tracts of land for
buildings, a vegetable garden belongs to a house and, in the case of a convent, its use is
limited to the necessities of the priest, which comes under the exemption. Also, land used as
a lodging house by the people who participate in religious festivities, which constitutes an
incidental use in religious functions, not for commercial purposes, comes within the
exemption. It cannot be taxed according to its former use (cemetery).
The Roman Catholic Bishop of Nuevo Segovia, as represented by the Catholic Church vs The
Provincial Board of Ilocos Norte, et al. Ponente: Avancea, J *before you continue reading this
, you should know the actual case isnt even a full page long. Basahin mo na lang yun Facts:
the Church owns land in a municipality in Ilocos Norte. All four sides of the Church face
public streets. To the south, it has a convent and a vegetable garden and on the other side,
it has an old cemetery with the ruins of a tower. July 3, 1925, the plaintiff paid, under
protest, the land tax for the area which was formerly the cemetery and the current
vegetable garden This action was the filed by the plaintiff Church to recover the sum they
paid, claiming that the tax collected was illegal. ISSUES/HELD - W/N the old cemetery and/or
vegetable garden are exempted from land tax. The exemption in favor of the convent in
land tax, refers to those who preside over the church and the land he uses to take care of
himself. A vegetable garden belongs to a house, and in the case of the convent, belongs to
the priest it is exempted from tax laws The cemetery though used for commercial
purpose, because it is being used as a place to stay by people who participate in religious
festivals, is an incidental use in religious function. also exempted. Both are exempted.
Defendant ordered to refund plaintiff. Malcolm, J., dissent "Cemeteries or burial grounds . . .
and all lands, buildings, and improvements use exclusively for religious . . . purposes, but
this exemption shall not extend to property held for investment, or which produces income,
even though the income be devoted to some one or more of the purposes above specified."
(Administrative Code, sec. 344; Act No. 2749, sec. 1.) the huerta (garden) in question was
not being used for religious purposes the cemetery was being leased and had been used
to plant corn the test to be applied to the combined law and facts must be the actual use
of the property should not be exempt from land tax
TOLENTINO VS SEC OF FINANCE
RA 7716, otherwise known as the Expanded Value-Added Tax Law, is an act that seeks
to widen the tax base of the existing VAT system and enhance its administration by
amending the National Internal Revenue Code. There are various suits questioning and
challenging the constitutionality of RA 7716 on various grounds.
Tolentino contends that RA 7716 did not originate exclusively from the House of
Representatives but is a mere consolidation of HB. No. 11197 and SB. No. 1630 and it
did not pass three readings on separate days on the Senate thus violating Article VI,
Sections 24 and 26(2) of the Constitution, respectively.

Art. VI, Section 24: All appropriation, revenue or tariff bills, bills authorizing increase of
the public debt, bills of local application, and private bills shall originate exclusively in
the House of Representatives, but the Senate may propose or concur with
amendments.
Art. VI, Section 26(2): No bill passed by either House shall become a law unless it has
passed three readings on separate days, and printed copies thereof in its final form
have been distributed to its Members three days before its passage, except when the
President certifies to the necessity of its immediate enactment to meet a public
calamity or emergency. Upon the last reading of a bill, no amendment thereto shall be
allowed, and the vote thereon shall be taken immediately thereafter, and the yeas and
nays entered in the Journal.
Procedural Issue:
(1)

WoN RA 7716 originated exclusively from the House of Rep. in accordance with sec 24, art
6 of Consti

(2)

WoN the Senate bill violated the three readings on separate days requirement of the
Consti

(3)

WoN RA 7716 violated sec 26(1), art 6 - one subject, one title rule.
NOTE: This case was filed by PAL because before the EVAT Law, they were exempt from
taxes. After the passage of EVAT, they were already included. PAL contended that neither the
House or Senate bill provided for the removal of the exemption from taxes of PAL and that it
was inly made after the meeting of the Conference Committee w/c was not expressed in the
title of RA 7166
Held:

(1)

YES! Court said that it is not the law which should originate from the House of Rep, but the
revenue bill which was required to originate from the House of Rep. The inititiative must
ocme from the Lower House because they are elected in the district level meaning they are
expected to be more sensitive to the needs of the locality.
Also, a bill originating from the Lower House may undergo extensive changes while in the
Senate. Senate can introduce a separate and distinct bill other than the one the Lower
House proposed. The Constitution does not prohibit the filing in the Senate of a substitute
bill in anticipation of its receipt of the House bill, so long as action by Senate is withheld
pending the receipt of the House bill.

(2)

NO. The Pres. certified that the Senate bill was urgent. Presidential certification dispensed
the requirement not only of printing but also reading the bill in 3 separate days. In fact, the
Senate accepted the Pres. certification

(3)

No. Court said that the title states that the purpose of the statute is to expand the VAT
system and one way of doing this is to widen its base by withdrawing some of the
exemptions granted before. It is also in the power of Congress to amend, alter, repeal grant
of franchises for operation of public utility when the common good so requires.
One subject rule is intended to prevent surprise upon Congress members and inform people
of pending legislation. In the case of PAL, they did not know of their situation not because of
any defect in title but because they might have not noticed its publication until some event
calls attention to its existence.
Whether or not RA 7716 violates Art. VI, Secs. 24 and 26(2) ofthe Constitution
Held:
The argument that RA 7716 did not originate exclusively in the House of Representatives as
required by Art. VI, Sec. 24 of the Constitution will not bear analysis. To begin with, it is not
the law but the revenue bill which is required by the Constitution to originate exclusively in
the House of Representatives. To insist that a revenue statute and not only the bill which
initiated the legislative process culminating in the enactment of the law must substantially
be the same as the House bill would be to deny the Senates power not only to concur with
amendments but also to propose amendments. Indeed, what the Constitution simply means

is that the initiative for filing revenue, tariff or tax bills, bills authorizing an increase of the
public debt, private bills and bills of local application must come from the House of
Representatives on the theory that, elected as they are from the districts, the members of
the House can be expected to be more sensitive to the local needs and problems. Nor does
the Constitutionprohibit the filing in the Senate of a substitute bill in anticipation of its
receipt of the bill from the House, so long as action by the Senate as a body is withheld
pending receipt of the House bill.
The next argument of the petitioners was that S. No. 1630 did not pass 3 readings on
separate days as required by the Constitution because the second and third readings were
done on the same day. But this was because the President had certified S. No. 1630 as
urgent. The presidential certification dispensed with the requirement not only of printing but
also that of reading the bill on separate days. That upon the certification of a billby the
President the requirement of 3 readings on separate days and of printing and distribution
can be dispensed with is supported by the weightof legislative practice.
BOLINAO ELECTRONICS CORP VS VALENCIA
Bolinao Electronics Corporation was the co-owner and a co-petitioner of Chronicle
Broadcasting Network, Inc. (CBN) and Montserrat Broadcasting System Inc. They operate
and own television (channel 9) and radio stations in the Philippines. They were summoned
by Brigido Valencia, then Secretary of Communications, for operating even after their permit
has expired. Valencia claimed that because of CBNs continued operation sans license and
their continuing operation had caused damages to his department.
ISSUE: Whether or not Valencia is entitled to claim for damages.
HELD: The SC ruled in the negative. Valencia failed to show that any right of his has been
violated by the refusal of CBN to cease operation. Further, the SC noted that as the records
show, the appropriation to operate the Philippine Broadcasting Service as approved by
Congress and incorporated in the 1962-1963 Budget of the Republic of the Philippines does
not allow appropriations for TV stations particularly in Luzon. Hence, since there was no
appropriation allotted then there can be no damage; and if there are expenditures made by
Valencias department they are in fact in violation of the law and they cannot claim damages
therefrom. And even if it is shown that the then president vetoed this provision of the Budget
Act, such veto is illegal because he may not legally veto a condition attached to an
appropriation or item in the appropriation bill.
Note: This ruling, that the executives veto power does not carry with it the power to strike
out conditions or restrictions, has been adhered to in subsequent cases. If the veto is
unconstitutional, it follows that the same produced no effect whatsoever; and the restriction
imposed by the appropriation bill, therefore, remains.

Gonzales v. Macaraig, Jr. 1990

GR 87636 -EN BANC

Facts:
December 16, 1988 Congress passed House Bill No. 19186 (GAB of Fiscal Year 1989) which
eliminated or decreased certain items included in the proposed budget submitted by the
president
December 29, 1988 President signed bill into law (RA 6688) but vetoed 7 special
provisions and Sec 55, a general provision.
February 2, 1989 Senate passed Res. No. 381 Senate as an institution decided to contest
the constitutionality of the veto of the president of SEC 55 only.
April 11, 1989 this petition was filed
January 19, 1990 filed motion for leave to file and to admit supplemental petition same
issues but included SEC 16 of House Bill 26934 (Gab for FY 1990 or RA 6831)
SEC. 55 disallows the president and heads of several department to augment any item in
the GAB thereby violation CONSTI ART VI SEC 25 (5) (page 459)

 SEC 16 of the GAB of 1990 provides for the same and the reason for veto remains the same
with the additional legal basis of violation of PD 1177 SEC 44 and 45 as amended by RA
6670 that authorizes the president and the heads of depts. To use saving to augment any
item of appropriations in the exec branch of government (page 460)
ISSUE:
Whether or not the veto by the President of SEC 55 of GAB for FY 1989 and SEC 16 of GAB
for FY 1990 is unconstitutional.
HELD:
The veto is CONSTITUTIONAL. Although the petitioners contend that the veto exceeded
the mandate of the line-veto power of the president because SEC 55 and SEC 16 are
provisions the court held that inappropriate provisions can be treated as items (Henry v.
Edwards) and therefore can be vetoed validly by the president. Furthermore inappropriate
provisions must be struck down because they contravene the constitution because it limits
the power of the executive to augment appropriations (ART VI SEC 25 PAR 5.)
The provisions are inappropriate because
o They do not relate to particular or distinctive appropriations
o Disapproved or reduces items are nowhere to be found on the face of the bill
o It is more of an expression of policy than an appropriation
Court also said that to make the GAB veto-proof would be logrolling on the part of the
legislative the subject matter of the provisions should be dealt with in separate and
complete legislation but because they are aware that it would be NOT passed in that manner
they attempt hide it in the GAB
If the legislature really believes that the exercise of veto is really invalid then congress
SHOULD resort to their constitutionally vested power to override the veto. (ART VI SEC 21
PAR 1)
DECISION: Veto UPHELD. Petition DISMISSED.

BENGZON VS DRILON
In 1990, Congress sought to reenact some old laws (i.e. Republic Act No. 1797) that were
repealed during the time of former President Ferdinand Marcos. These old laws provided
certain retirement benefits to retired judges, justices, and members of the constitutional
commissions. Congress felt a need to restore these laws in order to standardize retirement
benefits among government officials. However, President Corazon Aquino vetoed the bill
(House Bill No. 16297) on the ground that the law should not give preferential treatment to
certain or select government officials.
Meanwhile, a group of retired judges and justices filed a petition with the Supreme Court
asking the court to readjust their pensions. They pointed out that RA 1797 was never
repealed (by P.D. No. 644) because the said PD was one of those unpublished PDs which
were subject of the case of Taada v. Tuvera. Hence, the repealing law never existed due to
non publication and in effect, RA 1797 was never repealed. The Supreme Court then
readjusted their pensions.
Congress took notice of the readjustment and son in the General Appropriations Bill
(GAB) for 1992, Congress allotted additional budget for pensions of retired justices. Congress
however did the allotment in the following manner: Congress made an item entitled:
General Fund Adjustment; included therein are allotments to unavoidable obligations in
different brances of the government; among such obligations is the allotment for the
pensions of retired justices of the judiciary.
However, President Aquino again vetoed the said lines which provided for the pensions of
the retired justices in the judiciary in the GAB. She explained that that portion of the GAB is
already deemed vetoed when she vetoed H.B. 16297.
This prompted Cesar Bengzon and several other retired judges and justices to question the
constitutionality of the veto made by the President. The President was represented by then
Executive Secretary Franklin Drilon.

ISSUE: Whether or not the veto of the President on that portion of the General
Appropriations bill is constitutional.
HELD: No. The Justices of the Court have vested rights to the accrued pension that is due to
them in accordance to Republic Act 1797 which was never repealed. The president has no
power to set aside and override the decision of the Supreme Court neither does the
president have the power to enact or amend statutes promulgated by her predecessors
much less to the repeal of existing laws.
The Supreme Court also explained that the veto is unconstitutional since the power of the
president to disapprove any item or items in the appropriations bill does not grant the
authority to veto part of an item and to approve the remaining portion of said item. It
appears that in the same item, the Presidents vetoed some portion of it and retained the
others. This cannot be done. The rule is: the Executive must veto a bill in its entirety or not
at all; the Executive must veto an entire line item in its entirety or not at all. In this case, the
president did not veto the entire line item of the general adjustment fund. She merely
vetoed the portion which pertained to the pensions of the justices but did not veto the other
items covering obligations to the other departments of the government.

HELD: The Justices of the Court have vested rights to the accrued pension that is due to
them in accordance to Republic Act 1797. The president has no power to set aside and
override the decision of the Supreme Court neither does the president have the power to
enact or amend statutes promulgated by her predecessors much less to the repeal of
existing laws. The veto is unconstitutional since the power of the president to disapprove
any item or items in the appropriations bill does not grant the authority to veto part of an
item and to approve the remaining portion of said item.

NOTES: Pocket Veto Not Allowed

Under the Constitution, the President does not have the so-called pocket-veto power, i.e.,
disapproval of a bill by inaction on his part. The failure of the President to communicate his
veto of any bill represented to him within 30 days after the receipt thereof automatically
causes

the

bill

to

become

law.

This rule corrects the Presidential practice under the 1935 Constitution of releasing veto
messages long after he should have acted on the bill. It also avoids uncertainty as to what
new laws are in force.

When is it allowed?

The exception is provided in par (2),Sec 27 of Art 6 of the Constitution which grants the
President power to veto any particular item or items in an appropriation, revenue or tariff
bill. The veto in such case shall not affect the item or items to which he does not object.

3 ways how a bill becomes a law.

1.

When

the

President

signs

it

2. When the President vetoes it but the veto is overridden by 2/3 vote of all the members of
each

House;

and

3. When the president does not act upon the measure within 30 days after it shall have been
presented to him.

BILL MILLER vs. ATANACIO MARDO and MANUEL GONZALES G.R. No. L-15138 July 31, 1961
FACTS: These appeals present one identical question of law, namely, the validity of
Reorganization Plan No. 20-A, prepared and submitted by the Government Survey and
Reorganization Commission under the authority of Republic Act No. 997, as amended by
Republic Act No. 1241, insofar as it confers jurisdiction to the Regional Offices of the
Department of Labor created in said Plan to decide claims of laborers for wages, overtime
and separation pay, etc. In G.R. No. L-15138, Manuel Gonzales filed with Regional Office No.
3 of the Department of Labor, in Manila, a complaint against Bill Miller (owner and manager
of Miller Motors) claiming to be a driver of Miller from December 1, 1956 to October 31,
1957, on which latter date he was allegedly arbitrarily dismissed, without being paid
separation pay. He prayed for judgment for the amount due him as separation pay plus
damages. Upon receipt of said complaint, Chief Hearing Officer Atanacio Mardo of Regional
Office No. 3 of the Department of Labor required Miller to file an answer. In G.R. No. L-16781,
Cresencio Estano filed with Regional Office No. 3 of the Department of Labor, a complaint
(RO 3 Ls. Case No. 874) against Chin Hua Trading Co. and/or Lao Kang Suy and Ke Bon
Chiong, as Manager and Assistant Manager thereof, respectively, claiming to have been their
driver from June 17, 1947 to June 4, 1955, for which service he was not paid overtime pay
(for work in excess of 8 hours and for Sundays and legal holidays) and vacation leave pay.
He prayed for judgment for the amount due him, plus attorney's fees. Case Digests in
Administrative Law by Mark Anthony N. Manuel 2012 21 In G.R. No. L-15377, appellant
Numeriana Raganas filed with the Court of First Instance of Cebu a complaint (Civil Case No.
R-5535) against appellees Sen Bee Trading Company, Macario Tan and Sergio Tan, claiming
that she was employed by appellees as a seamstress from June 5, 1952 to January 11, 1958,
for which service she was underpaid and was not given overtime, as well as vacation and
sick leave pay. She prayed for judgment on the amount due her for the same plus damages.
In G.R. No. L-16660, Vicente B. Romero filed with Regional Officer No. 2 of the Department of
Labor a complaint (Wage Case No. 196-W) against Sia Seng, for recovery of alleged unpaid
wages, overtime and separation pay. Sia Seng, filed an answer. In G.R. No. L-17056, Mariano
Pabillare instituted in Regional Office No. 3 of the Department of Labor a complaint (IS-2168)
against petitioner Fred Wilson & Co., Inc., alleging that petitioner engaged his services as
Chief Mechanic, Air conditioning Department, from October 1947 to February 19, 1959,
when he was summarily dismissed without cause and without sufficient notice and
separation pay. The petitioners questioned the authority of the regional offices to take
cognizance of the subject matter involved in their cases as provided for by paragraph 25 of
Article VI of Reorganization Plan No. 20-A, which provided that: 25. Each regional office shall
have original and exclusive jurisdiction over all cases falling under the Workmen's
Compensation law, and cases affecting all money claims arising from violations of labor
standards

on

working

conditions

including

but

not

restrictive

to:

unpaid

wages,

underpayment, overtime, separation pay and maternity leave of employees and laborers;
and unpaid wages, overtime, separation pay, vacation pay and payment for medical services
of domestic help. ISSUE: Whether or not the jurisdiction to take cognizance of cases
affecting money claims such as those sought to be enforced in these proceedings, is a new
conferment of power to the Department of Labor not theretofore exercised by it. HELD: It is
true that in Republic Act No. 1241, amending Section 4 of Republic Act 997, which created
the Government Survey and Reorganization Commission, the latter was empowered (2) To
abolish departments, offices, agencies, or functions which may not be necessary, or create
those which way be necessary for the efficient conduct of the government service, activities,
and functions. (Emphasis supplied.) But these "functions" which could thus be created,
obviously refer merely to administrative, not judicial functions. For the Government Survey
and Reorganization Commission was created to carry out the reorganization of the Executive

Branch of the National Government (See Section 3 of R.A. No. 997, as amended by R.A. No.
1241), which plainly did not include the creation of courts. And the Constitution expressly
provides that "the Judicial power shall be vested in one Supreme Court and in such inferior
courts as may be established by law.(Sec. 1, Art. VII of the Constitution). Thus, judicial power
rests exclusively in the judiciary. It may be conceded that the legislature may confer on
administrative boards or bodies quasi-judicial powers involving the exercise of judgment and
discretion, as incident to the performance of administrative functions. But in so doing, the
legislature must state its intention in express terms that would leave no doubt, as even such
quasi- Case Digests in Administrative Law by Mark Anthony N. Manuel 2012 22 judicial
prerogatives must be limited, if they are to be valid, only to those incidental to or in
connection with the performance of jurisdiction over a matter exclusively vested in the
courts. If a statute itself actually passed by the Congress must be clear in its terms when
clothing administrative bodies with quasi-judicial functions, then certainly such conferment
can not be implied from a mere grant of power to a body such as the Government Survey
and Reorganization Commission to create "functions" in connection with the reorganization
of the Executive Branch of the Government.

FACTS: Defendant-appellant Que Po Lay was in possession of foreign exchange consisting of

U.S. dollars, U.S. checks and U.S. money orders amounting to about $7,000. He failed to sell
the same to the Central Bank through its agents within one day following the receipt of such
foreign exchange as required by Circular No. 20. The appeal is based on the claim that said
circular No. 20 was not published in the Official Gazette prior to the act or omission imputed
to the appellant, and that consequently, said circular had no force and effect.
Defendant-appellant contended that Commonwealth Act. No., 638 and Act 2930 both require
said circular to be published in the Official Gazette, it being an order or notice of general
applicability. The Solicitor General answering this contention says that Commonwealth Act.
No. 638 and 2930 do not require the publication in the Official Gazette of said circular issued
for the implementation of a law in order to have force and effect.
ISSUE: whether the circular should be published first to have the force and effect
of law.
HELD: Yes. Section 11 of the Revised Administrative Code provides that statutes passed by
Congress shall, in the absence of special provision, take effect at the beginning of the
fifteenth day after the completion of the publication of the statute in the Official Gazette.
Article 2 of the new Civil Code (Republic Act No. 386) equally provides that laws shall take
effect after fifteen days following the completion of their publication in the Official Gazette,
unless it is otherwise provided. It is true that Circular No. 20 of the Central Bank is not a
statute or law but being issued for the implementation of the law authorizing its issuance, it
has the force and effect of law according to settled jurisprudence.
Moreover, as a rule, circulars and regulations especially like the Circular No. 20 of the
Central Bank in question which prescribes a penalty for its violation should be published
before becoming effective, this, on the general principle and theory that before the public is
bound by its contents, especially its penal provisions, a law, regulation or circular must first
be published and the people officially and specifically informed of said contents and its
penalties.
In the present case, although circular No. 20 of the Central Bank was issued in the year
1949, it was not published until November 1951, that is, about 3 months after appellant's
conviction of its violation. It is clear that said circular, particularly its penal provision, did not
have any legal effect and bound no one until its publication in the Official Gazzette or after
November 1951.

FACTS

Que Po Lay (Que) was charged of violating Central Bank Circular No. 20 for failing to sell
foreign exchange in his possession consisting of U.S. dollars, U.S. checks, and U.S.
money orders amounting to $7,000 to the Central Bank within one day from the receipt
of such foreign exchange.
The trial court found him guilty.
Hence, this appeal where Que contends that Circular No. 20 had no force and effect
because it was not published in the Official Gazette, prior to the act or omission imputed
to him.

ISSUES/HELD
Should the circular have been published to produce legal effects? YES. JUDGMENT
REVERSED.

RATIONALE

It is true that Circular No. 20 of the Central Bank is not a statute or law but being issued
for the implementation of the law authorizing its issuance, it has the force and effect of
law according to settled jurisprudence.
Thus, it has to comply with the requirements of publication of a statute before it may
take effect as mandated by Section 11 of the Revised Administrative Code and Art. 2 of
the Civil Code.
Moreover, as a rule, circulars and regulations which prescribe a penalty for their violation
should be published before becoming effective; this is on the general principle and
theory that before the public is bound by its contents, especially its penal provisions, a
law, regulation, or circular must first be published and the people officially and
specifically informed of said contents and its penalties.
It is clear that Circular No. 20 did not have any legal effect and bound no one until its
publication in the Official Gazette or after November 1951.
Thus, Que could not be held liable for its violation for it was not binding at the time he
was found to have failed to sell the foreign exchange in his possession within one day
following his taking possession thereof.
Although this issue was only raised for the first time on appeal, it may still be considered
because the court may be said to have had no jurisdiction when it rendered a judgment
finding Que guilty of violating Circular No. 20 which, in the eyes of the law, was not in
existence for not having been published.

NAZARETH VS VILLAR
A DMINISTRATIVE LAW; POWER TO AUGMENT; CANNOT BE USED TO FUND NON-EXISTENT
PROVISION IN THE GAA. Further, in Nazareth v. Villar, we clarified that there must be an
existing item, project or activity, purpose or object of expenditure with an appropriation to
which savings may be transferred for the purpose of augmentation. Accordingly, so long as
there is an item in the GAA for which Congress had set aside a specified amount of public
fund, savings may be transferred thereto for augmentation purposes. This interpretation is
consistent not only with the Constitution and the GAAs, but also with the degree of flexibility
allowed to the Executive during budget execution in responding to unforeseeable
contingencies.