GR L 17888; (October, 1968) (Digest)
G.R. No. L-17888 October 29, 1968
RESINS, INCORPORATED, petitioner, vs. AUDITOR GENERAL OF THE PHILIPPINES and THE CENTRAL BANK OF THE PHILIPPINES, respondents.
FACTS
Petitioner Resins, Incorporated sought a refund from the respondent Central Bank of margin fees it paid for the importation of urea and formaldehyde as separate units. Petitioner claimed these importations were exempt under Republic Act No. 2609 , as they were used to produce synthetic glue. The specific statutory language exempts “urea formaldehyde.” Petitioner did not import “urea formaldehyde” as a finished product but imported urea and formaldehyde separately. The respondent Auditor General, in an indorsement to the Central Bank, caused the Bank to overrule its previous resolution and adopt the view that the separate importations were not exempt. Petitioner assails this action of the Auditor General.
ISSUE
Whether the separate importation of urea and formaldehyde is exempt from the margin fee under Republic Act No. 2609 , which exempts “urea formaldehyde.”
RULING
No. The petition is denied. The Supreme Court held that the exemption under Republic Act No. 2609 for “urea formaldehyde” refers to the finished product, not to the separate components “urea” and “formaldehyde.” The Court, following its precedent in Casco Philippine Chemical Co., Inc. v. Gimenez, ruled that the enrolled bill, which uses the term “urea formaldehyde,” is conclusive upon the courts. Any alleged mistake in the printing of the bill must be remedied by the legislature, not the judiciary. Furthermore, tax exemptions are construed strictly against the taxpayer and in favor of the government; the statutory language does not clearly and categorically grant an exemption for the separate articles. The action of the Auditor General in interpreting the statute literally and calling the attention of the Central Bank was in accordance with his constitutional duty to ensure that public funds are disbursed only pursuant to an appropriation law, and his interpretation was not contrary to law.