G.R. No.

L-17169

November 30, 1963

ISIDRO C. ANG-ANGCO, petitioner, vs. HON. NATALIO P. CASTILLO, ET AL.,

respondents.
On October 8, 1956, the Pepsi-Cola Far East Trade Development Co., Inc. wrote a
letter to the Secretary of Commerce and Industry requesting for special permit to
withdraw certain commodities from the customs house which were imported
without any dollar allocation or remittance of foreign exchange. Said commodities
consisted of 1,188 units of pepsi-cola concentrates which were not covered by any
Central Bank release certificate. On the same date, the company addressed an
identical request to the Secretary of Finance who was also the Chairman of the
Monetary Board of the Central Bank. Senator Pedro Sabido, in behalf of the
company, likewise wrote said official urging that authority be given to withdraw the
abovementioned concentrates. Not content with this step, he also wrote to Dr.
Andres Castillo, Acting Governor of the Central Bank, urging, the same matter. Then
Secretary Hernandez wrote another letter to Dr. Castillo stating, "Senator Sabido is
taking this to you personally. Unless we have legal objection, I would like to
authorize the withdrawal of the concentrates upon payment of all charges in pesos.
Please expedite action."
Almost at the same time, the Import-Export Committee of the Central Bank, thru Mr.
Gregorio Licaros, submitted to the Monetary Board a memorandum on the joint
petition of the company and Sabido Law Office for authority to withdraw the
concentrates from the customs house stating therein that it sees no objection to the
proposal. The Monetary Board, however, failed to take up the matter in its meeting
of October 12, 1956 for the reason that the transaction did not involve any dollar
allocation or foreign exchange, and of this decision Mr. Licaros was informed.
Having failed to secure the necessary authority from the Central Bank, on October
13, 1956, the counsel of the Pepsi-Cola Far East Trade Development Co., Inc.,
approached Collector of Customs Isidro Ang-Angco in an attempt to secure from him
the immediate release of the concentrates, but this official seeing perhaps that the
importation did not carry any release certificate from the Central Bank advised the
counsel to try to secure the necessary release certificate from the No-Dollar Import
Office that had jurisdiction over the case. In the morning of the same day, Mr.
Aquiles J. Lopez, of said Office, wrote a letter addressed to the Collector of Customs
stating, among other things, that his office had no objection to the release of the
1,188 units of concentrates but that it could not take action on the request as "the
same is not within the jurisdiction of the No-Dollar Import Office within the
contemplation of R.A. No. 1410." The counsel already referred to above showed the
letter to Collector of Customs Ang-Angco who upon perusing it still hesitated to
grant the release. Instead he suggested that the letter be amended in order to
remove the ambiguity appearing therein, but Mr. Lopez refused to amend the letter
stating that the same was neither a permit nor a release. Secretary of Finance

Hernandez having been contacted by telephone, Collector of Customs Ang-Angco

read to him the letter after which the Secretary verbally expressed his approval of
the release on the basis of said certificate. Collector Ang-Angco, while still in doubt
as to the propriety of the action suggested, finally authorized the release of the
concentrates upon payment of the corresponding duties, customs charges, fees and
taxes.

When Commissioner of Customs Manuel P. Manahan learned of the release of the

concentrates in question he immediately ordered their seizure but only a negligible
portion thereof remained in the warehouse. Whereupon, he filed an administrative
complaint against Collector of Customs Ang-Angco charging him with having
committed a grave neglect of duty and observed a conduct prejudicial to the best
interest of the customs service. On the strength of this complaint President Ramon
Magsaysay constituted an investigating committee to investigate Ang-Angco
composed of former Solicitor General Ambrosio Padilla, as Chairman, and Atty.
Arturo A. Alafriz and Lt. Col. Angel A. Salcedo, as members. Together with Collector
Ang-Angco, Mr. Aquiles J. Lopez, was also investigated by the same Committee, who
was also charged in a separate complaint with serious misconduct in office or
conduct prejudicial to the best interest of the State. As a result, Collector Ang-Angco
was suspended from office in the latter part of December, 1956.
After the investigation, the committee submitted to President Magsaysay its report
recommending that a suspension of 15 days, without pay, be imposed upon AngAngco chargeable against the period of his suspension. On April 1, 1957, Collector
Ang-Angco was reinstated to his office by Secretary Hernandez, but the decision on
the administrative case against him remained pending until the death of President
Magsaysay. After around three years from the termination of the investigation
during which period Ang-Angco had been discharging the duties of his office,
Executive Secretary Natalio P. Castillo, by authority of the President, rendered a
decision on the case on February 12, 1960 finding Ang-Angco "guilty of conduct
prejudicial to the best interest of the service", and considering him resigned
effective from the date of notice, with prejudice to reinstatement in the Bureau of
Customs.
Upon learning said decision from the newspapers, Collector Ang-Angco wrote a
letter to President Carlos P. Garcia calling attention to the fact that the action taken
by Secretary Castillo in removing him from office had the effect of depriving him of
his statutory right to have his case originally decided by the Commissioner of Civil
Service, as well as of his right of appeal to the Civil Service Board of Appeals, whose
decision under Republic Act No. 2260 is final, besides the fact that such decision is
in violation of the guaranty vouchsafed by the Constitution to officers or employees
in the civil service against removal or suspension except for cause in the manner
provided by law.

In a letter dated February 16, 1960, Secretary Castillo, also by authority of the
President, denied the request for reconsideration. Not satisfied with this resolution,
Collector Ang-Angco sent a memorandum to President Garcia reiterating once more
the same grounds on which he predicated his request for reconsideration. Again
Secretary Castillo, also by authority of the President, in letter dated July 1, 1960,
denied the appeal. In this instance, Secretary Castillo asserted that the President
virtue of his power of control over all executive departments, bureaus and offices,
can take direct action and dispose of the administrative case in question inasmuch
as the provisions of law that would seem to vest final authority in subordinate
officers of the executive branch of the government over administrative matters
falling under their jurisdiction cannot divest the President of his power of control nor
diminish the same.

Hence, after exhausting all the administrative remedies available to him to secure
his reinstatement to the office from which he was removed without any valid cause
or in violation of his right to due process of law, Collector Ang-Angco filed before this
Court the present petition for certiorari, prohibition and mandamus with a petition
for the issuance of a preliminary mandatory injunction. The Court gave due course
to the petition, but denied the request for injunction.
The main theme of petitioner is that respondent Executive Secretary Natalio P.
Castillo in acting on his case by authority of the President in the sense of
considering him as resigned from notice thereof, violated the guaranty vouchsafed
by the Constitution to officers and employees in the classified service in that he
acted in violation of Section 16 (i) of the Civil Service Act of 1959 which vests in the
Commissioner of Civil Service the original and exclusive jurisdiction to decide
administrative cases against officers and employees in the classified service,
deprived him of his right of appeal under Section 18 (b) of the same Act to the Civil
Service Board of Appeals whose decision on the matter is final, and removed him
from the service without due process in violation of Section 32 of the same Act
which expressly provides that the removal or suspension of any officer or employee
from the civil service shall be accomplished only after due process, and of Section 4,
Article XII of our Constitution which provides that "No officer or employee in the civil
service shall be removed except for cause as provided for by law." Since petitioner
is an officer who belongs to the classified civil service and is not a presidential
appointee, but one appointed by the Secretary of Finance under the Revised
Administrative Code, he cannot be removed from the service by the President in
utter disregard of the provisions of the Civil Service Act of 1959.
Respondents, on their part, do not agree with this theory entertained by petitioner.
They admit that if the theory is to be considered in the light of the provisions of the
Civil Service Act of 1959, the same may be correct, for indeed the Civil Service Law
as it now stands provides that all officers and employees who belong to the

classified service come under the exclusive jurisdiction of the Commissioner of Civil
Service and as such all administrative cases against them shall be indorsed to said
official whose decision may be appealed to the Civil Service Board of Appeals from
whose decision no further appeal can be taken. They also admit that petitioner
belongs to the classified civil service. But it is their theory that the pertinent
provisions of the Civil Service Law applicable to employees in the classified service
do not apply to the particular case of petitioner since to hold otherwise would be to
deprive the President of his power of control over the officers and employees of the
executive branch of the government. In other words, respondents contend that,
whether the officers or employees concerned are presidential appointees or belong
to the classified service, if they are all officers and employees in the executive
department, they all come under the control of the President and, therefore, his
power of removal may be exercised over them directly without distinction. Indeed,
respondents contend that, if, as held in the case of Negado v. Castro, 55 O.G.,
10534, the President may modify or set aside a decision of the Civil Service Board of
Appeals at the instance of the office concerned, or the respondent employee, or
may even do so motu propio, there would be in the final analysis no logical
difference between removing petitioner by direct action of the President and
separating him from the service by ultimate action by the President should an
appeal be taken from the decision of the Civil Service Board of Appeals to him, or if
in his discretion he may motu proprio consider it necessary to review the Board's
decision. It is contended that this ruling still holds true in spite of the new provision
wrought into the law by Republic Act 2260 which eliminated the power of review
given to the President because the power of control given by the Constitution to the
President over officers and employees in the executive department can only be
limited by the Constitution and not by Congress, for to permit Congress to do so
would be to diminish the authority conferred on the President by the Constitution
which is tantamount to amending the Constitution itself (Hebron v. Reyes, L- 9124,
July 28, 1958). Indeed this is the argument invoked by respondent Castillo in taking
direct action against petitioner instead of following the procedure outlined in the
Civil Service Act of 1959 as may be seen from the following portion of his decision.
In connection with the second ground advanced in support of your petition, it is
contended that in deciding the case directly, instead of transmitting it to the
Commissioner of Civil Service for original decision, his Office deprived the
respondent of his right to appeal to the Civil Service Board of Appeals. This
contention overlooks the principle that the President may modify or set aside a
decision of the Civil Service Board of Appeals at the instance of either the office
concerned or the respondent employee, or may even do so motu proprio (Negado
vs. Castro, 55 O.G, No. 51, p. 10534, Dec. 21, 1959). There would therefore be no
difference in effect between direct action by the President and ultimate action by
him should an appeal be taken from the decision of the Commissioner of Civil
Service or the Civil Service Board of Appeals. The result is that the President's direct

action would be the final decision that would be reached in case an appeal takes its
due course.
Thus, we see that the main issue involved herein is whether the President has the
power to take direct action on the case of petitioner even if he belongs to the
classified service in spite of the provisions now in force in the Civil Service Act of
1959. Petitioner sustains the negative contending that the contrary view would
deprive him of his office without due process of law while respondents sustain the
affirmative invoking the power of control given to the President by the Constitution
over all officers and employees, belonging to the executive department.
To begin with, we may state that under Section 16 (i) of the Civil Service Act of 1959
it is the Commissioner of Civil Service who has original and exclusive jurisdiction to
decide administrative cases of all officers and employees in the classified service for
in said section the following is provided: "Except as otherwise provided by law, (the
Commissioner shall) have final authority to pass upon the removal, separation and
suspension of all permanent officers and employees in the competitive or classified
service and upon all matters relating to the employees." The only limitation to this
power is that the decision of the Commissioner may be appealed to the Civil Service
Board of Appeals, in which case said Board shall decide the appeal within a period
of 90 days after the same has been submitted for decision, whose decision in such
case shall be final (Section 18, Republic Act 2260). It should be noted that the law
as it now stands does not provide for any appeal to the President, nor is he given
the power to review the decision motu proprio, unlike the provision of the previous
law, Commonwealth Act No. 598, which was expressly repealed by the Civil Service
Act of 1959 (Rep. Act 2260), which provides that the decision of the Civil Service
Board of Appeals may be reversed or modified motu proprio by the President. It is,
therefore, clear that under the present provision of the Civil Service Act of 1959, the
case of petitioner comes under the exclusive jurisdiction of the Commissioner of
Civil Service, and having been deprived of the procedure laid down therein in
connection with the investigation and disposition of his case, it may be said that he
has been deprived of due process as guaranteed by said law.
It must, however, be noted that the removal, separation and suspension of the
officers and employees of the classified service are subject to the saving clause
"Except as otherwise provided by law" (Section 16 [i], Republic Act No. 2260). The
question then may be asked: Is the President empowered by any other law to
remove officers and employees in the classified civil service?
The only law that we can recall on the point is Section 64 (b) of the Revised
Administrative Code, the pertinent portion of which we quote:
(b) To remove officials from office conformably to law and to declare
vacant the offices held by such removed officials. For disloyalty to the (United
States) Republic of the Philippines, the (Governor-General) President of the

Philippines may at any time remove a person from any position of trust or
authority under the Government of the (Philippine Islands) Philippines.
The phrase "conformably to law" is significant. It shows that the President does not
have blanket authority move any officer or employee of the government but his
power must still be subject to the law that passed by the legislative body
particularly with regard the procedure, cause and finality of the removal of persons
who may be the subject of disciplinary action. Here, as above stated we have such
law which governs action to be taken against officers and employees in classified
civil service. This law is binding upon President.
Another provision that may be mentioned is Section (D) of the Revised
Administrative Code, which provides:
Power to appoint and remove. The Department Head, the
recommendation of the chief of the Bureau or office concerned, shall appoint
all subordinate officers and employees appointment is not expressly vested
by law in the (Governor-General) President of the Philippines, and may
remove or punish them, except as especially provided otherwise, in
accordance the Civil Service Law.
The phrase "in accordance with the Civil Service is also significant. So we may say
that even granting for administrative purposes, the President of the Philippines is
considered as the Department Head of the Civil Service Commission, his power to
remove is still subject to the Civil Service Act of 1959, and we already know with
regard to officers and employees who belong to classified service the finality of the
action is given to the Commissioner of Civil Service or the Civil Board of Appeals.
Let us now take up the power of control given to President by the Constitution over
all officers and employees in the executive department which is now in by
respondents as justification to override the specific visions of the Civil Service Act.
This power of control couched in general terms for it does not set in specific manner
its extent and scope. Yes, this Court in the case of Hebron v. Reyes, supra, had
already occasion to interpret the extent of such power to mean "the power of an
officer to alter or modify or nullify or set aside what a subordinate officer had done
in the performance of his duties and to substitute the judgment of the former for
that of the latter,"1 to distinguish it from the power of general supervision over
municipal government, but the decision does not go to the extent of including the
power to remove an officer or employee in the executive department. Apparently,
the power merely applies to the exercise of control over the acts of the subordinate
and not over the actor or agent himself of the act. It only means that the President
may set aside the judgment or action taken by a subordinate in the performance of
his duties.
That meaning is also the meaning given to the word "control" as used in
administrative law. Thus, the Department Head pursuant to Section 79(C) is given

direct control of all bureaus and offices under his department by virtue of which he
may "repeal or modify decisions of the chiefs of said bureaus or offices", and under
Section 74 of the same Code, the President's control over the executive department
only refers to matters of general policy. The term "policy" means a settled or
definite course or method adopted and followed by a government, body, or
individual,2 and it cannot be said that the removal of an inferior officer comes
within the meaning of control over a specific policy of government.
But the strongest argument against the theory of respondents is that it would
entirely nullify and set at naught the beneficient purpose of the whole civil service
system implanted in this jurisdiction, which is to give stability to the tenure of office
of those who belong to the classified service, in derogation of the provisions of our
Constitution which provides that "No officer or employee in the civil service shall be
removed or suspended except for cause as provided by law" (Section 4, Article XII,
Constitution).Here, we have two provisions of our Constitution which are apparently
in conflict, the power of control by the President embodied in Section 10 (1), Article
VII, and the protection extended to those who are in the civil service of our
government embodied in Section 4, Article XII. It is our duty to reconcile and
harmonize these conflicting provisions in a manner that may give to both full force
and effect and the only logical, practical and rational way is to interpret them in the
manner we do it in this decision. As this Court has aptly said in the case of Lacson v.
Romero:
... To hold that civil service officials hold their office at the will of the appointing
power subject to removal or forced transfer at any time, would demoralize and
undermine and eventually destroy the whole Civil Service System and structure. The
country would then go back to the days of the old Jacksonian Spoils System under
which a victorious Chief Executive, after the elections could if so minded, sweep out
of office, civil service employees differing in Political color or affiliation from him,
and sweep in his Political followers and adherents, especially those who have given
him help, political or otherwise. (Lacson v. Romero, 84 Phil. 740, 754)
There is some point in the argument that the Power of control of the President may
extend to the Power to investigate, suspend or remove officers and employees who
belong to the executive department if they are presidential appointees or do not
belong to the classified service for such can be justified under the principle that the
power to remove is inherent in the power to appoint (Lacson V. Romero, supra), but
not with regard to those officers or employees who belong to the classified service
for as to them that inherent power cannot be exercised. This is in line with the
provision of our Constitution which says that "the Congress may by law vest the
appointment of the inferior officers, in the President alone, in the courts, or in heads
of department" (Article VII, Section 10 [3], Constitution). With regard to these
officers whose appointments are vested on heads of departments, Congress has
provided by law for a procedure for their removal precisely in view of this
constitutional authority. One such law is the Civil Service Act of 1959.

We have no doubt that when Congress, by law, vests the appointment of inferior
officers in the heads of departments it may limit and restrict power of removal as it
seem best for the public interest. The constitutional authority in Congress to thus
vest the appointment implies authority to limit, restrict, and regulate the removal by
such laws as Congress may enact in relation to the officers so appointed. The head
of a department has no constitutional prerogative of appointment to officers
independently of legislation of Congress, and by such legislation he must be
governed, not only in making appointments but in all that is incident thereto. (U.S.
v. Perkins, 116 U.S. 483)
In resume, we may conclude that the action taken by respondent Executive
Secretary, even with the authority of the President, in taking direct action on the
administrative case of petitioner, without submitting the same to the Commissioner
of Civil Service, is contrary to law and should be set aside.
WHEREFORE, it is hereby ordered that petitioner be immediately reinstated to his
office as Collector of Customs for the Port of Manila, without prejudice of submitting
his case to the Commissioner of Civil Service to be dealt with in accordance with
law. No costs.

SHORT DIGEST:
ANG-ANGCO v. CASTILLO
The power of control of the President extends to the power to alter or modify
or nullify or set aside what a subordinate officer had done in the performance of his
duties and to substitute the judgment of the [President] for that of the [subordinate
officer]. This may be extended to the power to investigate, suspend or remove
officers and employees who belong to the executive department if they are
presidential appointees or do not belong to the classified service for such can be
justified that the power to remove is inherent to the power to appoint. The same
cannot be done to officers or employees who belong to the classified service. The
procedure laid down in the Civil Service Act of 1959 must be followed for their
removal.

Facts:
The Pepsi-Cola Co. requested for the withdrawal of pepsi-cola concentrates
which were notcovered by any Central Bank release certificate. Its counsels
approached Collector of Customs Ang-Angco to secure the immediate release of the
concentrates, but advised the counsel to secure the releasecertificate from the NoDollar Import Office. The Non-Dollar Import Office wrote a letter to Ang-Angcowhich
stated that his office had no objection to the release of the concentrates but could

not take action onthe request as it was not in their jurisdiction. Ang-Angco
telephoned the Secretary of Finance whoexpressed his approval of the release on
the basis of said certificate. Collector Ang-Angco finally releasedthe concentrates.
When Commissioner of Customs learned of the release he filed an
administrativecomplaint against Collector of Customs Ang-Angco. For three years
Ang-Angco had been discharging theduties of his office. Then, Executive Secretary
Castillo, by authority of the President, rendered his judgment against the petitioner.
Issue:
Whether the President is empowered to remove officers and employees in the
classified civilservice.
Holding:
The President does not have the power to remove officers or employees in
the classified civil service.
It is clear that under the present provision of the Civil Service Act of 1959, the
case of petitioner comes under the exclusive jurisdiction of the Commissioner of
Civil Service, and having beendeprived of the procedure laid down in connection
with the investigation and disposition of his case, itmay be said that he has been
deprived of due process as guaranteed by said law.The Power of control of the
President may extend to the Power to investigate, suspend or removeofficers and
employees who belong to the executive department if they are presidential
appointees but notwith regard to those officers or employees who belong to the
classified service for as to them that inherentpower cannot be exercised.This is in
line with the provision of our Constitution which says that "the Congress may by
lawvest the appointment of the inferior officers, in the President alone, in the courts,
or in heads of department" (Article VII, Section 10 [3], Constitution). With regard to
these officers whose appointmentsare vested on heads of departments, Congress
has provided by law for a procedure for their removalprecisely in view of this
constitutional authority. One such law is the Civil Service Act of 1959.
It well established in this case that it is contrary to law to take direct action
on the administrative case of an employee under classified service even with the
authority of the President without submitting the case to the Commissioner of Civil
Service

G.R. No. 112497

August 4, 1994

HON. FRANKLIN M. DRILON vs. MAYOR ALFREDO S. LIM,

The principal issue in this case is the constitutionality of Section 187 of the Local
Government Code reading as follows:
Procedure For Approval And Effectivity Of Tax Ordinances And Revenue
Measures; Mandatory Public Hearings. The procedure for approval of local
tax ordinances and revenue measures shall be in accordance with the
provisions of this Code: Provided, That public hearings shall be conducted for
the purpose prior to the enactment thereof; Provided, further, That any
question on the constitutionality or legality of tax ordinances or revenue
measures may be raised on appeal within thirty (30) days from the effectivity
thereof to the Secretary of Justice who shall render a decision within sixty
(60) days from the date of receipt of the appeal: Provided, however, That
such appeal shall not have the effect of suspending the effectivity of the
ordinance and the accrual and payment of the tax, fee, or charge levied
therein: Provided, finally, That within thirty (30) days after receipt of the
decision or the lapse of the sixty-day period without the Secretary of Justice
acting upon the appeal, the aggrieved party may file appropriate proceedings
with a court of competent jurisdiction.

Pursuant thereto, the Secretary of Justice had, on appeal to him of four oil
companies and a taxpayer, declared Ordinance No. 7794, otherwise known as the
Manila Revenue Code, null and void for non-compliance with the prescribed
procedure in the enactment of tax ordinances and for containing certain provisions
contrary to law and public policy. 1
In a petition for certiorari filed by the City of Manila, the Regional Trial Court of
Manila revoked the Secretary's resolution and sustained the ordinance, holding inter
alia that the procedural requirements had been observed. More importantly, it
declared Section 187 of the Local Government Code as unconstitutional because of
its vesture in the Secretary of Justice of the power of control over local governments
in violation of the policy of local autonomy mandated in the Constitution and of the
specific provision therein conferring on the President of the Philippines only the
power of supervision over local governments. 2

The present petition would have us reverse that decision. The Secretary argues that
the annulled Section 187 is constitutional and that the procedural requirements for
the enactment of tax ordinances as specified in the Local Government Code had
indeed not been observed.
Parenthetically, this petition was originally dismissed by the Court for noncompliance with Circular 1-88, the Solicitor General having failed to submit a
certified true copy of the challenged decision. 3 However, on motion for
reconsideration with the required certified true copy of the decision attached, the
petition was reinstated in view of the importance of the issues raised therein.
We stress at the outset that the lower court had jurisdiction to consider the
constitutionality of Section 187, this authority being embraced in the general
definition of the judicial power to determine what are the valid and binding laws by
the criterion of their conformity to the fundamental law. Specifically, BP 129 vests in
the regional trial courts jurisdiction over all civil cases in which the subject of the
litigation is incapable of pecuniary estimation, 4 even as the accused in a criminal
action has the right to question in his defense the constitutionality of a law he is
charged with violating and of the proceedings taken against him, particularly as
they contravene the Bill of Rights. Moreover, Article X, Section 5(2), of the
Constitution vests in the Supreme Court appellate jurisdiction over final judgments
and orders of lower courts in all cases in which the constitutionality or validity of
any treaty, international or executive agreement, law, presidential decree,
proclamation, order, instruction, ordinance, or regulation is in question.
In the exercise of this jurisdiction, lower courts are advised to act with the utmost
circumspection, bearing in mind the consequences of a declaration of
unconstitutionality upon the stability of laws, no less than on the doctrine of
separation of powers. As the questioned act is usually the handiwork of the
legislative or the executive departments, or both, it will be prudent for such courts,
if only out of a becoming modesty, to defer to the higher judgment of this Court in
the consideration of its validity, which is better determined after a thorough
deliberation by a collegiate body and with the concurrence of the majority of those
who participated in its discussion. 5
It is also emphasized that every court, including this Court, is charged with the duty
of a purposeful hesitation before declaring a law unconstitutional, on the theory that
the measure was first carefully studied by the executive and the legislative
departments and determined by them to be in accordance with the fundamental
law before it was finally approved. To doubt is to sustain. The presumption of
constitutionality can be overcome only by the clearest showing that there was
indeed an infraction of the Constitution, and only when such a conclusion is reached
by the required majority may the Court pronounce, in the discharge of the duty it
cannot escape, that the challenged act must be struck down.

In the case before us, Judge Rodolfo C. Palattao declared Section 187 of the Local
Government Code unconstitutional insofar as it empowered the Secretary of Justice
to review tax ordinances and, inferentially, to annul them. He cited the familiar
distinction between control and supervision, the first being "the power of an officer
to alter or modify or set aside what a subordinate officer had done in the
performance of his duties and to substitute the judgment of the former for the
latter," while the second is "the power of a superior officer to see to it that lower
officers perform their functions in accordance with law." 6 His conclusion was that
the challenged section gave to the Secretary the power of control and not of
supervision only as vested by the Constitution in the President of the Philippines.
This was, in his view, a violation not only of Article X, specifically Section 4 thereof,
7 and of Section 5 on the taxing powers of local governments, 8 and the policy of
local autonomy in general.
We do not share that view. The lower court was rather hasty in invalidating the
provision.

Section 187 authorizes the Secretary of Justice to review only the constitutionality
or legality of the tax ordinance and, if warranted, to revoke it on either or both of
these grounds. When he alters or modifies or sets aside a tax ordinance, he is not
also permitted to substitute his own judgment for the judgment of the local
government that enacted the measure. Secretary Drilon did set aside the Manila
Revenue Code, but he did not replace it with his own version of what the Code
should be. He did not pronounce the ordinance unwise or unreasonable as a basis
for its annulment. He did not say that in his judgment it was a bad law. What he
found only was that it was illegal. All he did in reviewing the said measure was
determine if the petitioners were performing their functions in accordance with law,
that is, with the prescribed procedure for the enactment of tax ordinances and the
grant of powers to the city government under the Local Government Code. As we
see it, that was an act not of control but of mere supervision.
An officer in control lays down the rules in the doing of an act. If they are not
followed, he may, in his discretion, order the act undone or re-done by his
subordinate or he may even decide to do it himself. Supervision does not cover such
authority. The supervisor or superintendent merely sees to it that the rules are
followed, but he himself does not lay down such rules, nor does he have the
discretion to modify or replace them. If the rules are not observed, he may order the
work done or re-done but only to conform to the prescribed rules. He may not
prescribe his own manner for the doing of the act. He has no judgment on this
matter except to see to it that the rules are followed. In the opinion of the Court,
Secretary Drilon did precisely this, and no more nor less than this, and so performed
an act not of control but of mere supervision.

The case of Taule v. Santos 9 cited in the decision has no application here because
the jurisdiction claimed by the Secretary of Local Governments over election
contests in the Katipunan ng Mga Barangay was held to belong to the Commission
on Elections by constitutional provision. The conflict was over jurisdiction, not
supervision or control.
Significantly, a rule similar to Section 187 appeared in the Local Autonomy Act,
which provided in its Section 2 as follows:
A tax ordinance shall go into effect on the fifteenth day after its
passage, unless the ordinance shall provide otherwise: Provided, however,
That the Secretary of Finance shall have authority to suspend the effectivity
of any ordinance within one hundred and twenty days after receipt by him of
a copy thereof, if, in his opinion, the tax or fee therein levied or imposed is
unjust, excessive, oppressive, or confiscatory, or when it is contrary to
declared national economy policy, and when the said Secretary exercises this
authority the effectivity of such ordinance shall be suspended, either in part
or as a whole, for a period of thirty days within which period the local
legislative body may either modify the tax ordinance to meet the objections
thereto, or file an appeal with a court of competent jurisdiction; otherwise,
the tax ordinance or the part or parts thereof declared suspended, shall be
considered as revoked. Thereafter, the local legislative body may not
reimpose the same tax or fee until such time as the grounds for the
suspension thereof shall have ceased to exist.

That section allowed the Secretary of Finance to suspend the effectivity of a tax
ordinance if, in his opinion, the tax or fee levied was unjust, excessive, oppressive
or confiscatory. Determination of these flaws would involve the exercise of judgment
or discretion and not merely an examination of whether or not the requirements or
limitations of the law had been observed; hence, it would smack of control rather
than mere supervision. That power was never questioned before this Court but, at
any rate, the Secretary of Justice is not given the same latitude under Section 187.
All he is permitted to do is ascertain the constitutionality or legality of the tax
measure, without the right to declare that, in his opinion, it is unjust, excessive,
oppressive or confiscatory. He has no discretion on this matter. In fact, Secretary
Drilon set aside the Manila Revenue Code only on two grounds, to with, the inclusion
therein of certain ultra vires provisions and non-compliance with the prescribed
procedure in its enactment. These grounds affected the legality, not the wisdom or
reasonableness, of the tax measure.
The issue of non-compliance with the prescribed procedure in the enactment of the
Manila Revenue Code is another matter.

In his resolution, Secretary Drilon declared that there were no written notices of
public hearings on the proposed Manila Revenue Code that were sent to interested
parties as required by Art. 276(b) of the Implementing Rules of the Local
Government Code nor were copies of the proposed ordinance published in three
successive issues of a newspaper of general circulation pursuant to Art. 276(a). No
minutes were submitted to show that the obligatory public hearings had been held.
Neither were copies of the measure as approved posted in prominent places in the
city in accordance with Sec. 511(a) of the Local Government Code. Finally, the
Manila Revenue Code was not translated into Pilipino or Tagalog and disseminated
among the people for their information and guidance, conformably to Sec. 59(b) of
the Code.
Judge Palattao found otherwise. He declared that all the procedural requirements
had been observed in the enactment of the Manila Revenue Code and that the City
of Manila had not been able to prove such compliance before the Secretary only
because he had given it only five days within which to gather and present to him all
the evidence (consisting of 25 exhibits) later submitted to the trial court.
To get to the bottom of this question, the Court acceded to the motion of the
respondents and called for the elevation to it of the said exhibits. We have carefully
examined every one of these exhibits and agree with the trial court that the
procedural requirements have indeed been observed. Notices of the public hearings
were sent to interested parties as evidenced by Exhibits G-1 to 17. The minutes of
the hearings are found in Exhibits M, M-1, M-2, and M-3. Exhibits B and C show that
the proposed ordinances were published in the Balita and the Manila Standard on
April 21 and 25, 1993, respectively, and the approved ordinance was published in
the July 3, 4, 5, 1993 issues of the Manila Standard and in the July 6, 1993 issue of
Balita, as shown by Exhibits Q, Q-1, Q-2, and Q-3.

The only exceptions are the posting of the ordinance as approved but this omission
does not affect its validity, considering that its publication in three successive issues
of a newspaper of general circulation will satisfy due process. It has also not been
shown that the text of the ordinance has been translated and disseminated, but this
requirement applies to the approval of local development plans and public
investment programs of the local government unit and not to tax ordinances.
We make no ruling on the substantive provisions of the Manila Revenue Code as
their validity has not been raised in issue in the present petition.
WHEREFORE, the judgment is hereby rendered REVERSING the challenged decision
of the Regional Trial Court insofar as it declared Section 187 of the Local
Government Code unconstitutional but AFFIRMING its finding that the procedural
requirements in the enactment of the Manila Revenue Code have been observed.
No pronouncement as to costs.

The principal issue in this case is the constitutionality of Section 187 of the Local
Government Code. The Secretary of Justice (on appeal to him of four oil companies
and a taxpayer) declared Ordinance No. 7794 (Manila Revenue Code) null and void
for non-compliance with the procedure in the enactment of tax ordinances and for
containing certain provisions contrary to law and public policy.

RTCs Ruling:
1. The RTC revoked the Secretarys resolution and sustained the ordinance. It
declared Sec 187 of the LGC as unconstitutional because it vests on the Secretary
the power of control over LGUs in violation of the policy of local autonomy
mandated in the Constitution.

Petitioners Argument:
1. The annulled Section 187 is constitutional and that the procedural requirements
for the enactment of tax ordinances as specified in the Local Government Code had
indeed not been observed. (Petition originally dismissed by the Court due to failure
to submit certified true copy of the decision, but reinstated it anyway.)
2.

Grounds of non-compliance of procedure

a.

No written notices as required by Art 276 of Rules of Local Government Code

b.

Not published

c.

Not translated to tagalog

Supreme Courts Argument:

1. Section 187 authorizes the petitioner to review only the constitutionality or
legality of tax ordinance. What he found only was that it was illegal. That act is not
control but supervision.
2. Control lays down the rules in the doing of act and if not followed order the act
undone or re-done. Supervision sees to it that the rules are followed.

3. Two grounds of declaring Manila Revenue Code null and void (1) inclusion of
certain ultra vires provisions (2) non-compliance with prescribed procedure in its
enactment but were followed.
The requirements are upon approval of local development plans and public
investment programs of LGU not to tax ordinances.