G.R. No. 164679; July 27, 2011
OFFICE OF THE OMBUDSMAN, Petitioner, vs. ULDARICO P. ANDUTAN, JR., Respondent.

FACTS

Respondent Uldarico P. Andutan, Jr. was formerly the Deputy Director of the One-Stop Shop Tax Credit and Duty Drawback Center of the Department of Finance (DOF). On July 1, 1998, he resigned from the DOF pursuant to a Memorandum from the Executive Secretary directing all non-career officials to vacate their positions. On September 1, 1999, the Fact Finding and Intelligence Bureau (FFIB) of the Office of the Ombudsman criminally and administratively charged Andutan and others. The charges arose from anomalies involving the illegal transfer of Tax Credit Certificates (TCCs) worth ₱242,433,534.00 to Steel Asia Manufacturing Corporation. Andutan was administratively charged with Grave Misconduct, Dishonesty, Falsification of Official Documents, and Conduct Prejudicial to the Best Interest of the Service. After proceedings where Andutan failed to submit a counter-affidavit or appear at a hearing, the Ombudsman, on July 30, 2001, found him guilty of Gross Neglect of Duty. As he was already separated from service, the penalty imposed was forfeiture of all leaves, retirement, and other benefits, plus perpetual disqualification from government reemployment. Andutan’s motion for reconsideration was denied. The Court of Appeals (CA) annulled the Ombudsman’s decision, ruling that the Ombudsman should not have conducted the investigation because: (1) under Section 20(5) of R.A. 6770 (The Ombudsman Act of 1989), it may not investigate a complaint filed more than one year from the act or omission complained of; and (2) the administrative case was filed after Andutan’s resignation, rendering it moot. The Ombudsman filed this petition for review.

ISSUE

1. Does Section 20(5) of R.A. 6770 prohibit the Ombudsman from conducting an administrative investigation a year after the act was committed?
2. Does Andutan’s resignation render moot the administrative case filed against him?
3. Assuming that the administrative case is not moot, are the Ombudsman’s findings supported by substantial evidence?

RULING

The Supreme Court denied the Ombudsman’s petition and affirmed the CA’s annulment of the administrative decision, but on different grounds.
1. On the first issue, the Court ruled that Section 20(5) of R.A. 6770 is merely directory, not mandatory. The use of the word “may” indicates it is discretionary. Therefore, the Ombudsman is not prohibited from investigating a complaint filed more than one year after the alleged act.
2. On the second issue, the Court ruled that Andutan’s resignation did not render the administrative case moot. Jurisprudence establishes that resignation pending an administrative investigation does not preclude the continuation of the proceedings, as accessory penalties like forfeiture of benefits and perpetual disqualification may still be imposed. The Court noted that a public servant’s resignation is not a bar to administrative investigation for acts committed while in service.
3. However, on the third issue, the Court found that the Ombudsman’s findings were not supported by substantial evidence. The Court held that the Ombudsman’s decision was based primarily on the findings of the FFIB and the failure of Andutan to file a counter-affidavit. The Court emphasized that in administrative proceedings, the burden of proof lies with the complainant. The Ombudsman cannot rely solely on the investigating bureau’s report or the respondent’s failure to refute the charges to constitute substantial evidence. The evidence must be substantial, which means more than a mere scintilla and such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. The Court found that the Ombudsman failed to present such evidence to prove Andutan’s gross neglect of duty. Consequently, the administrative finding of guilt could not stand.