G.R. No. 91860 January 13, 1992
Roseo U. Tejada and Radito C. Ching, petitioners, vs. Hon. Eufemio C. Domingo, in his capacity as Chairman of the Commission on Audit, respondent.

FACTS

Petitioners Roseo U. Tejada and Radito C. Ching are senior clerks of the Commission on Audit (COA) assigned to the Philippine National Bank (PNB) and the Central Bank, respectively. Prior to the effectivity of Republic Act No. 6758 (Compensation and Position Classification Act of 1989), they received compensation comprising their basic COA salary and additional allowances (e.g., bank equity pay, meal allowance) voluntarily given by the government banks to which they were assigned. This practice was altered by laws aiming to preserve COA’s independence by mandating that its personnel receive compensation only directly from COA appropriations.
Respondent COA Chairman, interpreting Section 18 of R.A. No. 6758 , issued a memorandum effective July 1, 1989, directing that COA officials and employees could only receive salaries and allowances paid directly by COA out of its own appropriations. Consequently, the additional emoluments petitioners received from PNB and Central Bank were ordered deleted from their payroll. Petitioners filed this special civil action, arguing the respondent’s implementation was erroneous and illegal, as it abruptly reduced their long-established take-home pay without a transitional arrangement.

ISSUE

Whether the respondent COA Chairman committed grave abuse of discretion in interpreting and implementing Section 18 of R.A. No. 6758 , which prohibits COA personnel from receiving emoluments from any government entity except those paid directly by COA.

RULING

No. The Supreme Court upheld the respondent’s interpretation and implementation, finding no grave abuse of discretion. The legal logic is anchored on the clear and unambiguous language of Section 18 of R.A. No. 6758 , which explicitly states that COA officials and employees “are prohibited from receiving salaries, honoraria, bonuses, allowances or other emoluments from any government entity… except those compensation paid directly by the COA out of its appropriations and contributions.” This provision is a legislative reinforcement of a long-standing policy, initially established by P.D. No. 1445 (The Government Auditing Code of the Philippines), designed to insulate COA personnel from potential influence by the agencies they audit, thereby preserving the constitutional mandate of COA’s independence and integrity.
The Court ruled that the respondent’s memorandum, which enforced this direct payment scheme and discontinued allowances from client agencies, was a correct and ministerial implementation of the law’s plain mandate. The alleged reduction in petitioners’ income, while recognized as a hardship, resulted from the lawful withdrawal of benefits that were not part of the standardized compensation plan under R.A. No. 6758 . The law itself provides the standardization and does not require the COA to create a transitional compensation scheme to offset the loss of unauthorized allowances. The Court concluded that the respondent acted within his statutory authority, and his interpretation was neither arbitrary nor capricious.