EN BANC

[G.R. No. 112497. August 4, 1994.]

HON. FRANKLIN M. DRILON, in his capacity as SECRETARY OF

JUSTICE , petitioner, vs. MAYOR ALFREDO S. LIM, VICE-MAYOR JOSE
L. ATIENZA, CITY TREASURER ANTHONY ACEVEDO, SANGGUNIANG
PANGLUNSOD AND THE CITY OF MANILA , respondents.

The City Legal Officer for petitioner.

Angara, Abello, Concepcion, Regala & Cruz for Caltex (Phils.)
Joseph Lopez for Sangguniang Panglunsod ng Manila.
L.A. Maglaya for Petron Corporation.

DECISION

CRUZ, J : p

The principal issue in this case is the constitutionality of Section 187 of the Local
Government Code reading as follows:
Procedure For Approval And Effectivity Of Tax Ordinances And Revenue
Measures; Mandatory Public Hearings. — The procedure for approval of local tax
ordinances and revenue measures shall be in accordance with the provisions of
this Code: Provided, That public hearings shall be conducted for the purpose prior
to the enactment thereof; Provided, further, That any question on the
constitutionality or legality of tax ordinances or revenue measures may be raised
on appeal within thirty (30) days from the effectivity thereof to the Secretary of
Justice who shall render a decision within sixty (60) days from the date of receipt
of the appeal: Provided, however, That such appeal shall not have the effect of
suspending the effectivity of the ordinance and the accrual and payment of the
tax, fee, or charge levied therein: Provided, nally, That within thirty (30) days
after receipt of the decision or the lapse of the sixty-day period without the
Secretary of Justice acting upon the appeal, the aggrieved party may le
appropriate proceedings with a court of competent jurisdiction.llcd

Pursuant thereto, the Secretary of Justice had, on appeal to him of four oil
companies and a taxpayer, declared Ordinance No. 7794, otherwise known as the Manila
Revenue Code, null and void for non-compliance with the prescribed procedure in the
enactment of tax ordinances and for containing certain provisions contrary to law and
public policy. 1
In a petition for certiorari led by the City of Manila, the Regional Trial Court of
Manila revoked the Secretary's resolution and sustained the ordinance, holding inter alia
that the procedural requirements had been observed. More importantly, it declared Section
187 of the Local Government Code as unconstitutional because of its vesture in the
Secretary of Justice of the power of control over local governments in violation of the
CD Technologies Asia, Inc. © 2018 cdasiaonline.com
 policy of local autonomy mandated in the Constitution and of the speci c provision therein
conferring on the President of the Philippines only the power of supervision over local
governments. 2
The present petition would have us reverse that decision. The Secretary argues that
the annulled Section 187 is constitutional and that the procedural requirements for the
enactment of tax ordinances as speci ed in the Local Government Code has indeed not
been observed. cdtai

Parenthetically, this petition was originally dismissed by the Court for non-
compliance with Circular 1-88, the Solicitor General having failed to submit a certi ed true
copy of the challenged decision. 3 However, on motion for reconsideration with the
required certi ed true copy of the decision attached, the petition was reinstated in view of
the importance of the issues raised therein.
We stress at the outset that the lower court had jurisdiction to consider the
constitutionality of Section 187, this authority being embraced in the general de nition of
the judicial power to determine what are the valid and binding laws by the criterion of their
conformity to the fundamental law. Speci cally, BP 129 vests in the regional trial courts
jurisdiction over all civil cases in which the subject of the litigation is incapable of
pecuniary estimation, 4 even as the accused in a criminal action has the right to question in
his defense the co institutionality of a law he is charged with violating and of the
proceedings taken against him, particularly as they contravene the Bill of Rights. Moreover,
Article X, Section 5(2), of the Constitution vests in the Supreme Court appellate jurisdiction
over nal judgments and orders of lower courts in all cases in which the constitutionality
or validity of any treaty, international or executive agreement, law, presidential decree,
proclamation, order, instruction, ordinance, or regulation is in question.
LibLex

In the exercise of this jurisdiction, lower courts are advised to act with the utmost
circumspection, bearing in mind the consequences of a declaration of unconstitutionality
upon the stability of laws, no less than on the doctrine of separation of powers. As the
questioned act is usually the handiwork of the legislative or the executive departments, or
both, it will be prudent for such courts, if only out of a becoming modesty, to defer to the
higher judgment of this Court in the consideration of its validity, which is better determined
after a thorough deliberation by a collegiate body and with the concurrence of the majority
of those who participated in its discussion. 5
It is also emphasized that every court, including this Court, is charged with the duty
of a purposeful hesitation before declaring a law unconstitutional, on the theory that the
measure was rst carefully studied by the executive and the legislative departments and
determined by them to be in accordance with the fundamental law before it was nally
approved. To doubt is to sustain. The presumption of constitutionality can be overcome
only by the clearest showing that there was indeed an infraction of the Constitution, and
only when such a conclusion is reached by the requipped majority may the Court
pronounce, in the discharge of the duty it cannot escape, that the challenged act must be
struck down. prcd

In the case before us, Judge Rodolfo C. Palattao declared Section 187 of the Local
Government Code unconstitutional insofar as it empowered the Secretary of Justice to
review tax ordinances and, inferentially, to annul them. He cited the familiar distinction
between control and supervision, the rst being "the power of an o cer to alter or modify
or set aside what a subordinate o cer had done in the performance of his duties and to
substitute the judgment of the former for the latter," while the second is "the power of a
CD Technologies Asia, Inc. © 2018 cdasiaonline.com
 superior o cer to see to it that lower o cers perform their functions is accordance with
law." 6 His conclusion was that the challenged section gave to the Secretary the power of
control and not of supervision only as vested by the Constitution in the President of the
Philippines. This was, in his view, a violation not only of Article X, speci cally Section 4
thereof, 7 and of Section 5 on the taxing powers of local governments, 8 and the policy of
local autonomy in general. cda

We do not share that view. The lower court was rather hasty in invalidating the
provision.
Section 187 authorizes the Secretary of Justice to review only the constitutionality
or legality of the tax ordinance and, if warranted, to revoke it on either or both of these
grounds. When he alters or modi es or sets aside a tax ordinance, he is not also permitted
to substitute his own judgment for the judgment of the local government that enacted the
measure. Secretary Drilon did set aside the Manila Revenue Code, but he did not replace it
with his own version of what the Code should be. He did not pronounce the ordinance
unwise or unreasonable as a basis for its annulment. He did not say that in his judgment it
was a bad law. What he found only was that it was illegal. All he did in reviewing the said
measure was determine if the petitioners were performing their functions is accordance
with law, that is, with the prescribed procedure for the enactment of tax ordinances and
the grant of powers to the city government under the Local Government Code. As we see
it, that was an act not of control but of mere supervision. llcd

An o cer in control lays down the rules in the doing of an act. It they are not
followed, he may, in his discretion, order the act undone or re-done by his subordinate or he
may even decide to do it himself. Supervision does not cover such authority. The
supervisor or superintendent merely sees to it that the rules are followed, but he himself
does not lay down such rules, nor does he have the discretion to modify or replace them. If
the rules are not observed, he may order the work done or re-done but only to conform to
the prescribed rules. He may not prescribe his own manner for the doing of the act. He has
no judgment on this matter except to see to it that the rules are followed. In the opinion of
the Court, Secretary Drilon did precisely this, and no more nor less than this, and so
performed an act not of control but of mere supervision.
The case of Taule v. Santos 9 cited in the decision has no application here because
the jurisdiction claimed by the Secretary of Local Governments over election contests in
the Katipunan ng Mga Barangay was held to belong to the Commission on Elections by
constitutional provision. The conflict was over jurisdiction, not supervision or control. cdrep

Signi cantly, a rule similar to Section 187 appeared in the Local Autonomy Act,
which provided in its Section 2 as follows:
A tax ordinance shall go into effect on the fteenth day after its passage,
unless the ordinance shall provide otherwise: Provided, however, That the
Secretary of Finance shall have authority to suspend the effectivity of any
ordinance within one hundred and twenty days after receipt by him of a copy
thereof, if, in his opinion, the tax or fee therein levied or imposed is unjust,
excessive, oppressive, or con scatory, or when it is contrary to declared national
economy policy, and when the said Secretary exercises this authority the
effectivity of such ordinance shall suspended, either in part or as a whole, for a
period of thirty days within which period the local legislative body may either
modify the tax ordinance to meet the objections thereto, or le an appeal with a
court of competent jurisdiction; otherwise, the tax ordinance or the part or parts
CD Technologies Asia, Inc. © 2018 cdasiaonline.com
 thereof declared suspended, shall be considered as revoked. Thereafter, the local
legislative body may not reimposed the same tax or fee until such time as the
grounds for the suspension thereof shall have ceased to exist.

That section allowed the Secretary of Finance to suspend the effectivity of a tax
ordinance if, in his opinion, the tax or fee levied was unjust, excessive, oppressive or
confiscatory. Determination of these aws would involve the exercise of judgment or
discretion and not merely an examination of whether or not the requirements or limitations
of the law had been observed; hence, it would smack of control rather than mere
supervision. That power was never questioned before this Court but, at any rate, the
Secretary of Justice is not given the same latitude under Section 187. All he is permitted to
do is ascertain the constitutionality or legality of the tax measure, without the right to
declare that, in his opinion, it is unjust, excessive, oppressive or con scatory. He has no
discretion on this matter. In fact, Secretary Drilon set aside the Manila Revenue Code only
on two grounds, to wit, the inclusion therein of certain ultra vires provisions and non-
compliance with the prescribed procedure in its enactment. These grounds affected the
legality, not the wisdom or reasonableness of the tax measure. LLpr

The issue of non-compliance with the prescribed procedure in the enactment of the
Manila Revenue Code is another matter.
In his resolution, Secretary Drilon declared that there were no written notices of
public hearings on the proposed Manila Revenue Code that were sent to interested parties
as required by Art. 276(b) of the Implementing Rules of the Local Government Code nor
were copies of the proposed ordinance published in three successive issues of a
newspaper of general circulation pursuant to Art. 276(a). No minutes were submitted to
show that the obligatory public hearings had been held. Neither were copies of the
measure as approved posted in prominent places in the city in accordance with Sec.
511(a) of the Local Government Code. Finally, the Manila Revenue Code was not translated
into Pilipino or Tagalog and disseminated among the people for their information and
guidance, conformably to Sec. 59(b) of the Code. prLL

Judge Palattao found otherwise. He declared that all the procedural requirements
had been observed in the enactment of the Manila Revenue Code and that the City of
Manila had not been able to prove such compliance before the Secretary only because he
had given it only ve days within which to gather and present to him all the evidence
(consisting of 25 exhibits) later submitted to the trial court.
To get to the bottom of his question, the Court acceded to the motion of the
respondents and called for the elevation to it of the said exhibits. We have carefully
examined every one of these exhibits and agree with the trial court that the procedural
requirements have indeed been observed. Notices of the public hearings were sent to
interested parties as evidenced by Exhibits G-1 to 17. The minutes of the hearings are
found in Exhibits M, M-1, M-2, and M-3. Exhibits B and C show that the proposed
ordinances were published in the Balita and the Manila Standard on April 21 and 25, 1993,
respectively, and the approved ordinance was published in the July 3, 4, 5 1993 issues of
the Manila Standard and in the July 6, 1993 issue of Balita, as shown by Exhibits Q, Q-1, Q-
2, and Q-3. prLL

The only exceptions are the posting of the ordinance as approved but this omission
does not affect its validity, considering that its publication in three successive issues of a
newspaper of general circulation will satisfy due process. It has also not been shown that
the text of the ordinance has been translated and disseminated, but this requirement
CD Technologies Asia, Inc. © 2018 cdasiaonline.com
 applies to the approval of local development plans and public investment programs of the
local government unit and not to tax ordinances.
We make no ruling on the substantive provisions of the Manila Revenue Code as
their validity has not been raised in issue in the present petition.
WHEREFORE, the judgment is hereby rendered REVERSING the challenged decision
of the Regional Trial Court insofar as it declared Section 187 of the Local Government
Code unconstitutional but AFFIRMING its nding that the procedural requirements in the
enactment of the Manila Revenue Code have been observed. No pronouncement as to
costs. cdll

SO ORDERED.
Narvasa, C.J., Feliciano, Padilla, Bidin, Regalado, Davide, Jr., Romero, Bellosillo, Melo,
Quiason, Puno, Vitug, Kapunan and Mendoza, JJ., concur.

Footnotes
1. Annex "E," rollo, pp. 37-55.

2. Annex "A," rollo, pp. 27-36.

3. Rollo, p. 256.
4. Sec. 19(1).

5. Art. VIII, Sec. 4(2), Constitution.

6. Mondano v. Silvosa, 97 Phil. 143; Hebron v. Reyes, 104 Phil. 175; Tecson v. Salas, 34
SCRA 282.
7. Sec. 4. The President of the Philippines shall exercise general supervision over local
governments. Provinces with respect to component cities and municipalities, and cities
and municipalities with respect to component barangays shall ensure that the acts of
their component units are within the scope of their prescribed powers and functions.
8. Sec. 5. Each local government unit shall have the power to create its own sources of
revenues and to levy taxes, fees, and charges subject to such guidelines and limitations
as the Congress may provide, consistent with the basic policy of local autonomy. Such
taxes, fees, and charges shall accrue exclusively to the local governments.

9. 200 SCRA 512.

CD Technologies Asia, Inc. © 2018 cdasiaonline.com