G.R. No. 222129 , February 02, 2021
Philippine Health Insurance Corporation, Petitioner, vs. Commission on Audit and COA Chairperson Michael G. Aguinaldo, COA Regional Office VI, and COA Regional Director, Atty. Eden T. Rafanan, Respondents.

FACTS

During the first half of 2010, the PhilHealth Regional Office No. VI paid a P10,000.00 cash gift to each official/employee (aggregate P1,190,000.00) for its 15th Anniversary pursuant to Board Resolutions, and transportation allowances to job order contractors (aggregate P187,122.73) pursuant to a Board Resolution. In July 2010, the COA Auditor issued Notice of Disallowance (ND) Nos. 2010-001 and 2010-002. ND 2010-001 disallowed the anniversary gift as irregular and excessive, citing issuances limiting such grants to P3,000.00. ND 2010-002 disallowed the transportation allowance for job order contractors as illegal, citing violation of contracts and lack of presidential authorization. The liable parties (approvers, certifiers, recipients) appealed to the COA Regional Director. In Decision No. 2012-031 dated December 26, 2012, the Regional Director denied the appeal for being filed out of time but affirmed the NDs on the merits. PhilHealth elevated the case to the COA Proper. In Decision No. 2014-440 dated December 29, 2014, the COA Proper dismissed PhilHealth’s petition for review for being filed out of time and declared the Regional Director’s decision final and executory. Its motion for reconsideration was denied. PhilHealth filed the present petition for certiorari.

ISSUE

Whether the subject disallowances had become final and executory due to PhilHealth’s failure to appeal within the reglementary period.

RULING

Yes, the disallowances had become final and executory. The COA Rules require an appeal from an ND to the COA Director within six months from receipt. An appeal from the Director’s decision to the COA Proper must be filed within the time remaining from the original six-month period. The COA Proper found that PhilHealth’s appeal to the Regional Director and its petition for review to the COA Proper were filed beyond the 180-day reglementary period, totaling 245 days. Even assuming the appeal to the Regional Director was timely, PhilHealth’s petition to the COA Proper was belated. PhilHealth moved for a 30-day extension to file its petition for review, but such motion does not automatically grant an extension. The COA Proper did not commit grave abuse of discretion in dismissing the petition for being filed out of time. Consequently, the NDs became final and executory. On the merits, the disallowances were proper: (1) The P10,000.00 anniversary gift exceeded the P3,000.00 ceiling under Administrative Order No. 263 and National Budget Circular No. 452, and PhilHealth’s fiscal autonomy does not absolve it from conforming to such rules; (2) The transportation allowance for job order contractors was unjustified as they are not employees and their contracts stated they were not entitled to employee benefits. The approving officials are liable for approving patently illegal disbursements, and the recipients are liable to refund based on solutio indebiti. The petition was dismissed.