Tolentino vs. Secretary of Finance G.R. No.

115455, August 25, 1994

Facts
The value-added tax (VAT) is levied on the sale, barter or exchange of goods and properties as well as on the sale or exchange
of services. RA 7716 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 challenging the constitutionality of RA 7716 on various grounds.
One contention is that RA 7716 did not originate exclusively in the House of Representatives as required by Art. VI, Sec. 24 of
the Constitution, because it is in fact the result of the consolidation of 2 distinct bills, H. No. 11197 and S. No. 1630. There is
also a contention that S. No. 1630 did not pass 3 readings as required by the Constitution.
Issue: Whether or not RA 7716 violates Art. VI, Secs. 24 and 26(2) of the 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
Constitution prohibit 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 bill by the President the requirement of 3 readings on
separate days and of printing and distribution can be dispensed with is supported by the weight of legislative practice.
ABAKADA v Ermita (Taxation)

FACTS:
RA 9337, an act amending certain sections of the National Internal Revenue Code of 1997, is questioned by petitioners for
being unconstitutional. Procedural issues raised by petitioners are the legality of the bicameral proceedings, exclusive
origination of revenue measures and the power of the Senate concomitant thereto. Also, an issue was raised with regard to the
undue delegation of legislative power to the President to increase the rate of value-added tax to 12%.
Petitioners also argue that the increase to 12%, as well as the 70% limitation on the creditable input tax, the 60- month
amortization on the purchase or importation of capital goods exceeding P1,000,000.00, and the 5% final withholding tax by
government agencies, is arbitrary, oppressive, and confiscatory, and that it violates the constitutional principle on progressive
taxation, among others.
ISSUE:
Whether RA 9337 is constitutional
RULING:
Yes. Mounting budget deficit, revenue generation, inadequate fiscal allocation for education, increased emoluments for health
workers, and wider coverage for full value-added tax benefits ... these are the reasons why Republic Act No. 9337 (R.A. No.
9337) was enacted. Reasons, the wisdom of which, the Court even with its extensive constitutional power of review, cannot
probe.
It has been said that taxes are the lifeblood of the government. In this case, it is just an enema, a first-aid measure to
resuscitate an economy in distress. The Court is neither blind nor is it turning a deaf ear on the plight of the masses. But it does
not have the panacea for the malady that the law seeks to remedy. As in other cases, the Court cannot strike down a law as
unconstitutional simply because of its yokes.

Garcia vs Mata

G.R. No. L-33713 July 30, 1975

Facts:
The donation of the property to the government to make the property public does not cure the constitutional defect. The fact
that the law was passed when the said property was still a private property cannot be ignored. In accordance with the rule that
the taxing power must be exercised for public purposes only, money raised by taxation can be expanded only for public
purposes and not for the advantage of private individuals. Inasmuch as the land on which the projected feeder roads were to
be constructed belonged then to Zulueta, the result is that said appropriation sought a private purpose, and, hence, was null
and void.
Issue:
Whether RA 1600 is valid. Does it contain rider in an appropriation bill?
Held:
The incongruity and irrelevancy are already evident. Section 11 of RA 1600 fails to disclose the relevance to any appropriation
item. RA 1600 is an appropriation law for the operation of government while Section 11 refers to a fundamental governmental
policy of calling to active duty and the reversion of inactive statute of reserve officers in the AFP.
Hence it was A NON-APPROPRIATION ITEM INSERTED IN AN APPROPRIATION MEASURE, in violation of the constitutional
prohibition against RIDERS to the general appropriation act. It was indeed a new and completely unrelated provision attached
to the GAA.
It also violates the rule on one-bill, one subject. The subject to be considered must be expressed in the title of the act. When an
act contains provisions which are clearly not embraced in the subject of the act, as expressed in the title, such provisions are
void, inoperative and without effect.
SECTION 11 is unconstitutional. Garcia cannot compel the AFP to reinstate him.
Demetria vs. Alba
Facts:
Petitioners assail the constitutionality of the first paragraph of Sec 44 of PD 1177 (Budget Reform Decree of 1977)as
concerned citizens, members of the National Assembly, parties with general interest common to all people of the Philippines,
and as taxpayerson the primary grounds that Section 44 infringes upon the fundamental law by authorizing illegal transfer of
public moneys, amounting to undue delegation of legislative powers and allowing the President to override the safeguards
prescribed for approving appropriations.
The Solicitor General, for the public respondents, questioned the legal standing of the petitioners and held that one branch of
the government cannot be enjoined by another, coordinate branch in its performance of duties within its sphere of
responsibility. It also alleged that the petition has become moot and academic after the abrogation of Sec 16(5), Article VIII of
the 1973 Constitution by the Freedom Constitution (which was where the provision under consideration was enacted in
pursuant thereof), which states that No law shall be passed authorizing any transfer of appropriations, however, the
Presidentmay by law be authorized to augment any item in the general appropriations law for their respective offices from
savings in other items of their respective appropriations.
Issue:
1. W/N PD 1177 is constitutional
2. W/N the Supreme Court can act upon the assailed executive act
Held:
1. No. Sec 44 of PD 1177 unduly overextends the privilege granted under Sec16(5) by empowering the President to
indiscriminately transfer funds from one department of the Executive Department to any program of any department included in
the General Appropriations Act, without any regard as to whether or not the funds to be transferred are actually savings in the
item. It not only disregards the standards set in the fundamental law, thereby amounting to an undue delegation of legislative
powers, but likewise goes beyond the tenor thereof.
Par. 1 of Sec. 44 puts all safeguards to forestall abuses in the expenditure of public funds to naught. Such constitutional
infirmities render the provision in question null and void.
2. Yes. Where the legislature or executive acts beyond the scope of its constitutional powers, it becomes the duty of the
judiciary to declare what the other branches of the government has assumed to do as void, as part of its constitutionally
conferred judicial power. This is not to say that the judicial power is superior in degree or dignity. In exercising this high
authority, the judges claim no judicial supremacy; they are only the administrators of the public will.

Petition granted. Par. 1, Sec. 44 OF PD 1177 null and void.

PHILCONSA VS. ENRIQUEZ
FACTS:
Petitioners assailed the validity of RA 7663 or General Appropriations Act of 1994.
GAA contains a special provision that allows any members of the Congress the REalignment of Allocation for Operational
Expenses, provided that the total of said allocation is not exceeded.
Philconsa claims that only the Senate President and the Speaker of the House of Representatives are the ones authorized
under the Constitution to realign savings, not the individual members of Congress themselves.
President signed the law, but Vetoes certain provisions of the law and imposed certain provisional conditions: that the AFP
Chief of Staff is authorized to use savings to augment the pension funds under the Retirement and Separation Benefits of the
AFP.
ISSUE:
Whether or not RA 7663 is violative of Article VI, Section 25 (5) of 1987 Constitution.
RULING:
Yes. Only the Senate President and the Speaker of the House are allowed to approve the realignment.
Furthermore, two conditions must be met: 1) the funds to be realigned are actually savings, and 2) the transfer is for the
purpose of augmenting the items of expenditures to which said transfer to be made.
As to the certain condition given to the AFP Chief of Staff, it is violative of of Sections 25(5) and 29(1) of the Article VI of the
Constitution. The list of those who may be authorized to transfer funds is exclusive. the AFP Chief of Staff may not be given
authority.

Araullo vs. Aquino

When President Benigno Aquino III took office, his administration noticed the sluggish growth of the economy.
The World Bank advised that the economy needed a stimulus plan. Budget Secretary Florencio Butch Abad
then came up with a program called the Disbursement Acceleration Program (DAP).
The DAP was seen as a remedy to speed up the funding of government projects. DAP enables the Executive
to realign funds from slow moving projects to priority projects instead of waiting for next years appropriation.
So what happens under the DAP was that if a certain government project is being undertaken slowly by a
certain executive agency, the funds allotted therefor will be withdrawn by the Executive. Once withdrawn,
these funds are declared as savings by the Executive and said funds will then be reallotted to other priority
projects. The DAP program did work to stimulate the economy as economic growth was in fact reported and
portion of such growth was attributed to the DAP (as noted by the Supreme Court).
Other sources of the DAP include the unprogrammed funds from the General Appropriations Act (GAA).
Unprogrammed funds are standby appropriations made by Congress in the GAA.
Meanwhile, in September 2013, Senator Jinggoy Estrada made an expos claiming that he, and other
Senators, received Php50M from the President as an incentive for voting in favor of the impeachment of then
Chief Justice Renato Corona. Secretary Abad claimed that the money was taken from the DAP but was
disbursed upon the request of the Senators.
This apparently opened a can of worms as it turns out that the DAP does not only realign funds within the
Executive. It turns out that some non-Executive projects were also funded; to name a few: Php1.5B for the
CPLA (Cordillera Peoples Liberation Army), Php1.8B for the MNLF (Moro National Liberation Front), P700M
for the Quezon Province, P50-P100M for certain Senators each, P10B for Relocation Projects, etc.
This prompted Maria Carolina Araullo, Chairperson of the Bagong Alyansang Makabayan, and several other
concerned citizens to file various petitions with the Supreme Court questioning the validity of the DAP. Among
their contentions was:
DAP is unconstitutional because it violates the constitutional rule which provides that no money shall be paid
out of the Treasury except in pursuance of an appropriation made by law.
Secretary Abad argued that the DAP is based on certain laws particularly the GAA (savings and augmentation
provisions thereof), Sec. 25(5), Art. VI of the Constitution (power of the President to augment), Secs. 38 and
49 of Executive Order 292 (power of the President to suspend expenditures and authority to use savings,
respectively).

Issues:
I. Whether or not the DAP violates the principle no money shall be paid out of the Treasury except in
pursuance of an appropriation made by law (Sec. 29(1), Art. VI, Constitution).
II. Whether or not the DAP realignments can be considered as impoundments by the executive.
III. Whether or not the DAP realignments/transfers are constitutional.
IV. Whether or not the sourcing of unprogrammed funds to the DAP is constitutional.
V. Whether or not the Doctrine of Operative Fact is applicable.
HELD:
I. No, the DAP did not violate Section 29(1), Art. VI of the Constitution. DAP was merely a program by the
Executive and is not a fund nor is it an appropriation. It is a program for prioritizing government spending. As
such, it did not violate the Constitutional provision cited in Section 29(1), Art. VI of the Constitution. In DAP no
additional funds were withdrawn from the Treasury otherwise, an appropriation made by law would have been
required. Funds, which were already appropriated for by the GAA, were merely being realigned via the DAP.
II. No, there is no executive impoundment in the DAP. Impoundment of funds refers to the Presidents power to
refuse to spend appropriations or to retain or deduct appropriations for whatever reason. Impoundment is
actually prohibited by the GAA unless there will be an unmanageable national government budget deficit
(which did not happen). Nevertheless, theres no impoundment in the case at bar because whats involved in
the DAP was the transfer of funds.
III. No, the transfers made through the DAP were unconstitutional. It is true that the President (and even the
heads of the other branches of the government) are allowed by the Constitution to make realignment of funds,
however, such transfer or realignment should only be made within their respective offices. Thus, no crossborder transfers/augmentations may be allowed. But under the DAP, this was violated because funds
appropriated by the GAA for the Executive were being transferred to the Legislative and other non-Executive
agencies.
Further, transfers within their respective offices also contemplate realignment of funds to an existing project
in the GAA. Under the DAP, even though some projects were within the Executive, these projects are nonexistent insofar as the GAA is concerned because no funds were appropriated to them in the GAA. Although
some of these projects may be legitimate, they are still non-existent under the GAA because they were not
provided for by the GAA. As such, transfer to such projects is unconstitutional and is without legal basis.
On the issue of what are savings
These DAP transfers are not savings contrary to what was being declared by the Executive. Under the
definition of savings in the GAA, savings only occur, among other instances, when there is an excess in the
funding of a certain project once it is completed, finally discontinued, or finally abandoned. The GAA does not
refer to savings as funds withdrawn from a slow moving project. Thus, since the statutory definition of
savings was not complied with under the DAP, there is no basis at all for the transfers. Further, savings should
only be declared at the end of the fiscal year. But under the DAP, funds are already being withdrawn from
certain projects in the middle of the year and then being declared as savings by the Executive particularly by
the DBM.
IV. No. Unprogrammed funds from the GAA cannot be used as money source for the DAP because under the
law, such funds may only be used if there is a certification from the National Treasurer to the effect that the
revenue collections have exceeded the revenue targets. In this case, no such certification was secured before
unprogrammed funds were used.
V. Yes. The Doctrine of Operative Fact, which recognizes the legal effects of an act prior to it being declared as
unconstitutional by the Supreme Court, is applicable. The DAP has definitely helped stimulate the economy. It
has funded numerous projects. If the Executive is ordered to reverse all actions under the DAP, then it may

cause more harm than good. The DAP effects can no longer be undone. The beneficiaries of the DAP cannot
be asked to return what they received especially so that they relied on the validity of the DAP. However, the
Doctrine of Operative Fact may not be applicable to the authors, implementers, and proponents of the DAP if it
is so found in the appropriate tribunals (civil, criminal, or administrative) that they have not acted in good faith.

Tio vs. Videogram Regulatory Board

In 1985, Presidential Dedree No. 1987 entitled An Act Creating the Videogram Regulatory Board was
enacted which gave broad powers to the VRB to regulate and supervise the videogram industry. The said law
sought to minimize the economic effects of piracy. There was a need to regulate the sale of videograms as it
has adverse effects to the movie industry. The proliferation of videograms has significantly lessened the
revenue being acquired from the movie industry, and that such loss may be recovered if videograms are to be
taxed. Section 10 of the PD imposes a 30% tax on the gross receipts payable to the LGUs.
In 1986, Valentin Tio assailed the said PD as he averred that it is unconstitutional on the following grounds:
1. Section 10 thereof, which imposed the 30% tax on gross receipts, is a rider and is not germane to the
subject matter of the law.
2. There is also undue delegation of legislative power to the VRB, an administrative body, because the law
allowed the VRB to deputize, upon its discretion, other government agencies to assist the VRB in enforcing
the said PD.
ISSUE: Whether or not the Valentin Tios arguments are correct.
HELD: No.
1. The Constitutional requirement that every bill shall embrace only one subject which shall be expressed in
the title thereof is sufficiently complied with if the title be comprehensive enough to include the general
purpose which a statute seeks to achieve. In the case at bar, the questioned provision is allied and germane
to, and is reasonably necessary for the accomplishment of, the general object of the PD, which is the
regulation of the video industry through the VRB as expressed in its title. The tax provision is not inconsistent
with, nor foreign to that general subject and title. As a tool for regulation it is simply one of the regulatory and
control mechanisms scattered throughout the PD.
2. There is no undue delegation of legislative powers to the VRB. VRB is not being tasked to legislate. What
was conferred to the VRB was the authority or discretion to seek assistance in the execution, enforcement,
and implementation of the law. Besides, in the very language of the decree, the authority of the BOARD to
solicit such assistance is for a fixed and limited period with the deputized agencies concerned being subject
to the direction and control of the [VRB].
The Philippine Judges Association, etc., petitioners
vs Hon. Pete Prado, etc., respondents
Facts:
The petitioners are members of the mower courts who feel that their official functions as judges will be prejudiced by the
Section 35 of RA No. 7354 through Circular No. 92-98 withdrawing the franking privilege from the SC, CA, RTC, MTCs and
Land Registration of Deeds and other government offices.
Petitioners assails the constitutionality of RA No. 7354 on the grounds: (1) its title embraces more than one subject and does
not express its purposes; (2) it did not pass the required readings in both Houses of Congress and printed copies of the bill in
its final form were not distributed among the members before its passage; and (3) it is discriminatory and encroaches on the
independence of the Judiciary.
Issue: the independence of the Judiciary.
Held:

(1) We are convinced that the withdrawal of the franking privilege from some agencies is germane to the accomplishment of
the principal objective of R.A. No. 7354, which is the creation of a more efficient and effective postal service system. Our ruling
is that, by virtue of its nature as a repealing clause, Section 35 did not have to be expressly included in the title of the said law.
(2) Applying these principles, we shall decline to look into the petitioners' charges that an amendment was made upon the last
reading of the bill that eventually became R.A. No. 7354 and that copies thereof in its final form were not distributed among the
members of each House. Both the enrolled bill and the legislative journals certify that the measure was duly enacted i.e., in
accordance with Article VI, Sec. 26(2) of the Constitution. We are bound by such official assurances from a coordinate
department of the government, to which we owe, at the very least, a becoming courtesy.
(3) The respondents counter that there is no discrimination because the law is based on a valid classification in accordance
with the equal protection clause. In fact, the franking privilege has been withdrawn not only from the Judiciary but also the
Office of Adult Education, the Institute of National Language; the Telecommunications Office; etc.
(4) We are unable to agree with the respondents that Section 35 of R.A. No. 7354 represents a valid exercise of discretion by
the Legislature under the police power. On the contrary, we find its repealing clause to be a discriminatory provision that denies
the Judiciary the equal protection of the laws guaranteed for all persons or things similarly situated. The distinction made by the
law is superficial. It is not based on substantial distinctions that make real differences between the Judiciary and the grantees
of the franking privilege.
It is unconstitutional.

Tan v Del Rosario

Facts:
1. Two consolidated cases assail the validity of RA 7496 or the Simplified Net Income Taxation Scheme ("SNIT"), which amended
certain provisions of the NIRC, as well as the Rules and Regulations promulgated by public respondents pursuant to said law.
2. Petitioners posit that RA 7496 is unconstitutional as it allegedly violates the following provisions of the Constitution:
-Article VI, Section 26(1) Every bill passed by the Congress shall embrace only one subject which shall be expressed in the
title thereof.
- Article VI, Section 28(1) The rule of taxation shall be uniform and equitable. The Congress shall evolve a progressive
system of taxation.
- Article III, Section 1 No person shall be deprived of . . . property without due process of law, nor shall any person be denied
the equal protection of the laws.
3. Petitioners contended that public respondents exceeded their rule-making authority in applying SNIT to general professional
partnerships. Petitioner contends that the title of HB 34314, progenitor of RA 7496, is deficient for being merely entitled,
"Simplified Net Income Taxation Scheme for the Self-Employed and Professionals Engaged in the Practice of their
Profession" (Petition in G.R. No. 109289) when the full text of the title actually reads,
'An Act Adopting the Simplified Net Income Taxation Scheme For The Self-Employed and Professionals Engaged In The Practice
of Their Profession, Amending Sections 21 and 29 of the National Internal Revenue Code,' as amended. Petitioners also
contend it violated due process.
5. The Solicitor General espouses the position taken by public respondents.
6. The Court has given due course to both petitions.
ISSUE: Whether or not the tax law is unconstitutional for violating due process
NO. The due process clause may correctly be invoked only when there is a clear contravention of inherent or constitutional
limitations in the exercise of the tax power. No such transgression is so evident in herein case.
1. Uniformity of taxation, like the concept of equal protection, merely requires that all subjects or objects of taxation, similarly
situated, are to be treated alike both in privileges and liabilities. Uniformity does not violate classification as long as: (1) the
standards that are used therefor are substantial and not arbitrary, (2) the categorization is germane to achieve the legislative
purpose, (3) the law applies, all things being equal, to both present and future conditions, and (4) the classification applies
equally well to all those belonging to the same class.
2. What is apparent from the amendatory law is the legislative intent to increasingly shift the income tax system towards the
schedular approach in the income taxation of individual taxpayers and to maintain, by and large, the present global
treatment on taxable corporations. The Court does not view this classification to be arbitrary and inappropriate.
ISSUE 2: Whether or not public respondents exceeded their authority in promulgating the RR
No. There is no evident intention of the law, either before or after the amendatory legislation, to place in an unequal footing or
in significant variance the income tax treatment of professionals who practice their respective professions individually and of
those who do it through a general professional partnership.

PHILCONSA vs. Gimenez

Philippine Constitution Association, Inc (PHILCONSA) assails the validity of Republic Act No. 3836 insofar as the same allows
retirement gratuity and commutation of vacation and sick leave to Senators and Representatives. PHILCONSA now seeks to
enjoin Pedor Gimenez, the Auditor General, from disbursing funds therefor.
According to PHILCONSA, the provision on retirement gratuity is an attempt to circumvent the Constitutional ban on increase
of salaries of the members of Congress during their term of office, contrary to the provisions of Article VI, Section 14 of the
Constitution. The same provision constitutes selfish class legislation because it allows members and officers of Congress to
retire after twelve (12) years of service and gives them a gratuity equivalent to one year salary for every four years of service,
which is not refundable in case of reinstatement or re-election of the retiree, while all other officers and employees of the
government can retire only after at least twenty (20) years of service and are given a gratuity which is only equivalent to one
month salary for every year of service, which, in any case, cannot exceed 24 months. The provision on vacation and sick leave,
commutable at the highest rate received, insofar as members of Congress are concerned, is another attempt of the legislator to
further increase their compensation in violation of the Constitution.
The Solicitor General, arguing for Congress, averred that the grant of retirement or pension benefits under Republic Act No.
3836 to the officers does not constitute forbidden compensation within the meaning of Section 14 of Article VI of the Philippine
Constitution. The law in question does not constitute class legislation. The payment of commutable vacation and sick leave
benefits under the said Act is merely in the nature of a basis for computing the gratuity due each retiring member and,
therefore, is not an indirect scheme to increase their salary.
ISSUE: Whether or not RA 3836 is constitutional.
HELD: No, the said law is unconstitutional. Section 14, Article VI, of the Constitution, provides:
The senators and the Members of the House of Representatives shall, unless otherwise provided by law, receive an annual
compensation of seven thousand two hundred pesos each, including per diems and other emoluments or allowances, and
exclusive only of travelling expenses to and from their respective district in the case of Members of the House of
Representatives and to and from their places of residence in the case of Senators, when attending sessions of the Congress.
No increase in said compensation shall take effect until after the expiration of the full term of all the Members of the Senate and
of the House of Representatives approving such increase. Until otherwise provided by law, the President of the Senate and the
Speaker of the House of Representatives shall each receive an annual compensation of sixteen thousand pesos.
When the Constitutional Convention first determined the compensation for the Members of Congress, the amount fixed by it
was only P5,000.00 per annum but it embodies a special proviso which reads as follows:
No increase in said compensation shall take effect until after the expiration of the full term of all the members of the National
Assembly elected subsequent to approval of such increase.
In other words, under the original constitutional provision regarding the power of the National Assembly to increase the salaries
of its members, no increase would take effect until after the expiration of the full term of the members of the Assembly elected
subsequent to the approval of such increase.
The Constitutional provision in the aforementioned Section 14, Article VI, includes in the term compensation other
emoluments.
Emolument is the profit arising from office or employment; that which is received as compensation for services or which is
annexed to the possession of an office, as salary, fees and perquisites.
It is evident that retirement benefit is a form or another species of emolument, because it is a part of compensation for services
of one possessing any office.
RA 3836 provides for an increase in the emoluments of Senators and Members of the House of Representatives, to take effect
upon the approval of said Act, which was on June 22, 1963. Retirement benefits were immediately available thereunder,
without awaiting the expiration of the full term of all the Members of the Senate and the House of Representatives approving
such increase. Such provision clearly runs counter to the prohibition in Article VI, Section 14 of the Constitution. RA 3836 is
hereby declared unconstitutional by the SC.

Insular Lumber Company vs. Court of Tax Appeal

Insular Lumber Company (ILC) is an American company engaged as a licensed forest concessionaire. The ILC purchased
manufactured oil and motor fuel which it used in the operation of its forest concession. In 1956, Republic Act No. 1435 was
passed. Section 5 thereof provides that there should be a partial tax refund to those using oil in the operation of forest and
mining concessions.

In 1964, ILC filed with the Commissioner of Internal Revenue (CIR) to have a tax refund of P19,921.37 pursuant to the said RA.
The Court of Industrial Relations (CIR) ruled that ILC is not covered by such provision because Sec. 5, RA 1435 is only
effective 5 years from its enactment. Hence, in 1961 the provision ceased to be effective. ILC appealed the issue to the CTA
and the CTA ruled the operation of a sawmill is distinct from the operation of a forest concession, hence, the refund provision of
Sec 5, RA 1435 allowing partial refund to forest and mining concessionaires cannot be extended to the operators of a sawmill.
And out of the P19,921.37 claimed, only the amount of P14,598.08 was paid on oil utilized in logging operations. The CTA did
not allow the refund of the full amount of P14,598.08 because the ILCs right to claim the refund of a portion thereof, particularly
those paid during the period from January 1, 1963 to April 29, 1963 had already prescribed. Hence, ICL was credited the refund
of P10,560.20 only. Both parties appealed from the decision of the CTA.
The CIR averred that CTA should not have ruled this way: The title of RA 1435 is An Act to Provide Means for Increasing The
Highway Special Fund. The CIR contends that the subject of RA 1435 was to increase Highway Special Fund. However,
Section 5 of the Act deals with another subject which is the partial exemption of miners and loggers. And this partial exemption
on which the Company based its claim for refund is clearly not expressed in the title of the aforesaid Act. More importantly,
Section 5 provides for a decrease rather than an increase of the Highway Special Fund.
ISSUE: Whether or not to grant the partial tax refund to ILC.
HELD: Yes, but only in the amount as found by the CTA. The Supreme Court ruled that there is no merit in the contention of
the CIR. RA 1435 deals with only one subject and proclaims just one policy, namely, the necessity for increasing the Highway
Special Fund through the imposition of an increased specific tax on manufactured oils. The proviso in Sec 5 of the law is in
effect a partial exemption from the imposed increased tax. Said proviso, which has reference to specific tax on oil and fuel, is
not a deviation from the general subject of the law. The primary purpose of the aforequoted constitutional provision is to prohibit
duplicity in legislation the title of which might completely fail to apprise the legislators or the public of the nature, scope and
consequences of the law or its operation. But that is not so for in the passage of RA 1435 since, as the records of its
proceedings bear out, a full debate on precisely the issue of whether its title reflects its complete subject was held by Congress
which passed it.