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459
EN BANC.
460
460
461
462
of the Fund does not form part of the revenues or profits of DBP,
and DBP may not use such income for its own benefit. The
principal and income of the Fund together constitute the res or
subject matter of the trust. The Agreement established the Fund
precisely so that it would eventually be sufficient to pay for the
retirement benefits of DBP employees under RA 1616 without
additional outlay from DBP. COA itself acknowledged the
authority of DBP to set up the Fund. However, COAs subsequent
directive would divest the Fund of income, and defeat the purpose
for the Funds creation.
Retirement Development Bank of the Philippines Statutes
Statutory Construction Being a special and later law, the DBP
Charter (E.O. 81, as amended by R.A. 8523) prevails over RA
4968.In disallowing the P11,626,414.25 distributed as dividends
under the SLP, the COA relied primarily on Republic Act No.
4968 (RA 4968) which took effect on 17 June 1967. RA 4968
added the following paragraph to Section 28 of CA 186, thus: (b)
Hereafter no insurance or retirement plan for officers or
employees shall be created by any employer. All supplementary
retirement or pension plans heretofore in force in any government
office, agency, or instrumentality or corporation owned or
controlled by the government, are hereby declared inoperative or
abolished: Provided, That the rights of those who are already
eligible to retire thereunder shall not be affected. Even assuming,
however, that the SLP constitutes a supplementary retirement
plan, RA 4968 does not apply to the case at bar. The DBP Char
463
463
464
465
CARPIO, J.:
The Case
1
assigned to DBP.
5
the Philippines.
An Act Strengthening the Development Bank of the Philippines,
466
AOM No. 932 did not question the authority of the Bank
to setup the [Gratuity Plan] Fund and have it9 invested in
the Trust Services Department of the Bank. Apart from
requiring the recipients of the P11,626,414.25 to refund
their dividends, the Auditor recommended that the DBP
record in its books as miscellaneous income the income of
the Gratuity Plan Fund (Fund). The Auditor reasoned
that the Fund is still owned by the Bank, the
_______________
8
Rollo, p. 20.
Ibid., p. 68.
467
467
Ibid.
11
Ibid., p. 82.
12
Ibid., p. 34.
468
468
14
15
Rollo, p. 24.
469
469
Ibid., p. 163.
470
470
(2) The Commission shall have exclusive authority, subject to the limitations in
this Article, to define the scope of its audit and examination, establish the
techniques and methods required therefor, and promulgate accounting and
auditing rules and regulations, including those for the prevention and
disallowance
of
irregular,
unnecessary,
inexpensive,
extravagant,
or
Rollo, p. 197.
For instance, in Philippine International Trading Corporation v.
Commission on Audit, 368 Phil. 478 309 SCRA 177 (1999) National
Center For Mental Health Management v. Commission on Audit, G.R. No.
114864, 6 December 1996, 265 SCRA 390 Philippine Ports Authority v.
Commission on Audit, G.R. No. 100773, 16 October 1992, 214 SCRA 653.
20
Each Commission shall decide by a majority vote of all its Members any case or
matter brought before it within sixty days from the date of its submission for
decision or resolution. A case or matter is deemed submitted for decision or
resolution upon the filing of the last pleading, brief, or memorandum required by
the rules of the Commission or by the Commission itself. Unless otherwise
provided
471
471
Tang v. Court of Appeals, 382 Phil. 277 325 SCRA 394 (2000).
23
Ibid.
24
472
Ortigas & Co. Ltd. v. Court of Appeals, G.R. No. 126102, 4 December
Rollo, p. 3.
Tala Realty Services Corporation v. Banco Filipino Savings and
Mortgage Bank, G.R. No. 137533, 22 November 2002, 392 SCRA 506
Huang v. Court of Appeals, G.R. No. 108525, 236 SCRA 420 (1994) citing
A. TOLENTINO, COMMENTARIES AND JURISPRUDENCE ON THE
CIVIL CODE OF THE PHILIPPINES, Vol. IV, 669 (1991).
28
Heirs of Yap v. Court of Appeals, 371 Phil. 523 312 SCRA 603 (1999).
473
473
March 1992, 207 SCRA 487 Commissioner of Internal Revenue v. Visayan Electric
Co., 132 Phil. 203 23 SCRA 715 (1968).
30
SCRA 715 (1968). Employees trusts are also exempted from certain taxes under
Section 60 (B) of the National Internal Revenue Code, as amended.
31
32
474
474
Rollo, p. 27.
34
Spouses Rosario v. Court of Appeals, 369 Phil. 729 310 SCRA 464 (1999),
475
475
Rollo, p. 34.
37
Ibid.
38
Ibid., p. 60.
476
476
1616, was further amended by Republic Act No. 3096 (1961) and Republic
Act No. 4968 (1967) to read:
(c) Retirement is likewise allowed to any official or employee, appointive or elective,
regardless of age and employment status, who has rendered a total of twenty years
of service, the last three years of which are continuous. The benefit shall, in
addition to the return of his personal contributions with interest compounded
monthly and the payment of the corresponding employers premiums described in
subsection (a) of Section five hereof, without interest, be only a gratuity equivalent
to one months salary for every year of the first twenty years of service, plus one
and onehalf months salary for every year of service over twenty but below thirty
years and two months salary for every year of service over thirty years in case of
employees based on the highest rate received and in case of elected officials on the
rates of pay as provided by law. This gratuity is payable by the employer or office
concerned which is hereby authorized to provide the necessary appropriation or
pay the same from any unexpended items of appropriation or savings in its
appropriation. (Emphasis supplied)
41
(b) The GSIS shall discontinue the processing and adjudication of retirement
claims under R.A. No. 1616 except refund of retirement premium and R.A. No.
910. Instead, all agencies concerned shall process and pay the gratuities of their
employees. The Board shall adopt the proper rules and procedures for the
implementation of this provision. (Emphasis supplied)
477
477
43
Rollo, p. 163.
478
478
47
479
Rollo., p. 55.
49
Ibid.
50
Ibid., p. 50.
51
480
state:
Sec. 11. (a) Amount of Annuity.Upon retirement after faithful and satisfactory
service a member shall be automatically entitled to a life annuity x x x Sec. 12.
Commission, G.R. No. 95940, 24 July 1996, 259 SCRA 161, citing
Soberano v. Clave, Nos. L4375356 and L50991, 29 August 1980, 99
SCRA 549.
54
345 SCRA 553, this Court held that retirement benefits do not constitute
compensation. A person who has retired but is later appointed to another
position may continue receiving his retirement annuity and a salary for
his new appointment. This is not double compensation.
55
Ibid.
481
481
Upon retirement under this Plan, an Employee shall receive, in addition to the
return of personal contributions to the GSIS, with interest compounded monthly
and the payment of the Banks premiums on his behalf to the GSIS, without
interest, a gratuity benefit equivalent to one months Salary for every year of the
first twenty years of Service x x x (Emphasis supplied).
57
58
Rollo, p. 20.
Article 1953 of the Civil Code.A person who receives a loan of
money or any other fungible thing acquires the ownership thereof, and is
bound to pay to the creditor an equal amount of the same kind and
quality.
59
Tanzo v. Drilon, 385 Phil. 790 329 SCRA 147 (2000), citing Yam vs.
Article 1953 in relation to Article 1933 of the Civil Code which states
482
Rollo, p. 38.
483
483
BIR Revenue Memorandum Order No. 993 (15 October 1992) states:
Other employees trust funds adverted to in this Order shall refer to the trust funds of
employees other than those of private employers/companies, the tax exempt qualification of
which had been determined/adjudicated by the BIR under then Section 56(b) [now Section
53(b)] of the Tax Code and not under RA 4917 or Section 28(b) (7) (A) of the Tax Code, e.g.,
PNB Provident Fund, CB Provident Fund, Land Bank of the Philippines Provident Fund,
GSIS Provident Fund, NPC Employees Savings & Welfare Plan, NHA Provident Fund, x x
x. (Italics provided by BIR)
484
484
485
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