GR 127710; (February, 2000) (Digest)
G.R. No. 127710 February 16, 2000
Azucena B. Garcia, petitioner, vs. The Honorable Office of the Ombudsman and Esmeraldo E. Sioson, Benedicta F. Barrientos, Jacqueline C. Mendoza, respondents.
FACTS
Petitioner Azucena B. Garcia, a Department Manager of the government-owned National Development Company (NDC), availed of an early retirement program in March 1995. Her application was approved under Republic Act No. 1616 , and she received her retirement benefits. However, private respondents, who were NDC officers, deducted withholding tax from the portion of her provident fund benefits that exceeded her personal contributions.
Garcia protested this deduction, claiming the amount was tax-exempt, and requested a refund. Upon the private respondents’ refusal, she filed a complaint with the Office of the Ombudsman against them for violation of Section 3(e) of R.A. No. 3019 (Anti-Graft and Corrupt Practices Act), alleging they caused her undue injury. The Ombudsman dismissed her complaint, prompting this appeal via certiorari.
ISSUE
Whether the Ombudsman acted with grave abuse of discretion in dismissing the complaint for violation of R.A. No. 3019 against the private respondents for deducting withholding taxes from the petitioner’s provident fund benefits.
RULING
The Court ruled in the negative and affirmed the Ombudsman’s resolution. For a violation of Section 3(e) of R.A. No. 3019 to exist, the accused public officer must have caused undue injury through manifest partiality, evident bad faith, or gross inexcusable negligence. The Court found that the private respondents did not transgress these elements.
Petitioner failed to demonstrate that the respondents acted with evident bad faith or gross negligence. At the time of the deduction, the private respondents were complying with their legal duty to withhold taxes, guided by the prevailing opinion of the Bureau of Internal Revenue (BIR) that such excess provident fund benefits were taxable. Their action was a performance of a ministerial duty; refusing to withhold would have exposed them to potential liability for violating tax laws. The subsequent change in the BIR Commissioner’s opinion on the taxability of such benefits, while potentially favorable to the petitioner, does not retroactively convert the respondents’ prior act—taken in reliance on the official opinion then prevailing—into a criminal act of bad faith. Consequently, no grave abuse of discretion attended the Ombudsman’s dismissal of the complaint.