G.R. Nos. L-13992 and L-14035; September 30, 1960
MANILA ELECTRIC COMPANY, petitioner, vs. PUBLIC SERVICE COMMISSION and PEDRO J. VELASCO, respondents.

DR. PEDRO J. VELASCO, petitioner, vs. MANILA ELECTRIC COMPANY, respondent.

FACTS

These are consolidated appeals from a decision of the Public Service Commission (PSC). Pedro J. Velasco filed a complaint against Manila Electric Company (Meralco) for violating its franchise and the Public Service Act. The PSC found Meralco guilty and imposed a fine of P200.00. Both parties appealed: Velasco (G.R. No. L-14035) contended the fine was too small, while Meralco (G.R. No. L-13992) argued there was no violation and, alternatively, that any violation had prescribed. The Supreme Court initially decided Velasco’s appeal on May 31, 1960, unaware of Meralco’s separate appeal. Upon learning of Meralco’s appeal, the Court suspended the effects of its May 1960 decision to consider both cases together.
The specific charge against Meralco was that it constructed an electric sub-station at the corner of South 6 and South D Streets in Quezon City without first obtaining the required approval from the PSC. Meralco admitted the construction without a permit but defended itself on several grounds.

ISSUE

1. Whether Meralco was required to secure PSC approval before constructing the electric sub-station.
2. Whether the structure in question qualified as a “sub-station” requiring such approval.
3. Whether the offense, if any, had prescribed.

RULING

The Supreme Court affirmed the PSC’s finding of guilt but modified the penalty.
1. On the Requirement of PSC Approval: The Court upheld the PSC’s ruling that Meralco needed its approval. Meralco’s reliance on Republic Act No. 150 (effective June 14, 1947) was unavailing. The Court agreed with the PSC that nothing in RA 150 repealed Section 20(b) of the Public Service Act (Commonwealth Act No. 146), which requires a public service operator to obtain Commission authority for new installations or additions. The PSC’s regulatory authority to approve such additions is essential to determine their necessity and to prevent unreasonable rate increases for customers. Furthermore, the Court noted that the sub-station was constructed in September-November 1953, which was after the five-year period provided in RA 150 had expired on June 14, 1952.
2. On the Nature of the Structure: The Court sustained the PSC’s factual and technical finding that the structure was a sub-station, not a simple assemblage of transformers. The PSC characterized a sub-station by its size or complexity, noting the subject structure had a capacity of 10,000/12,500 KVA, incorporated buses and circuit breakers, and served as a bulk receiving point for energy. The Court found no sufficient data in the record to overturn this finding and noted that Meralco itself had referred to the structure as a sub-station in a subsequent petition filed with the PSC.
3. On the Defense of Prescription: The Court rejected the defense of prescription. Since the sub-station was still standing at the time of the hearing, the violation constituted a continuous offense. For continuous offenses, the prescriptive period does not begin to run.
DISPOSITIVE PORTION:
The appealed PSC decision was affirmed insofar as it declared Meralco guilty. The penalty was modified: the fine was increased to P1,000.00. The suspension of the Court’s prior resolution of June 22, 1960, was lifted.