EN BANC
G.R. No. 227227, February 09, 2021
CRESENCIO D. ARCENA, IN HIS CAPACITY AS THE PRESIDENT OF BERLYN CONSTRUCTION AND DEVELOPMENT CORPORATION, Petitioner, v. COMMISSION ON AUDIT, Respondent.
D E C I S I O N
LOPEZ, M., J.:
Petitioner Cresencio D. Arcena (Arcena) assails the following Decisions of the Commission on Audit (COA) in this Petition for Certiorari,1 under Rule 64, in relation to Rule 65 of the Revised Rules of Court: (1) Decision No. 2015-2892 dated November 24, 2015; and (2) Decision No. 2016-1973 dated August 12, 2016, which sustained the notice of disallowance (ND) issued against him as payee and president of Berlyn Construction and Development Corporation (Berlyn Construction).
After a careful evaluation of the records, this Commission finds that the instant petition was filed out of time. Section 3, Rule VII of the 2009 Revised Rules of Procedure of the COA (RRPC), provides that a petition for review shall be taken within the time remaining of the six month period under Section 4, Rule V, taking into account the suspension of the running thereof under Section 5 of the same Rule in case of appeals from the Director's decision. Likewise, Section 5, Rule VII thereof requires that the petition shall state the specific dates to show that it was filed within the reglementary period.Arcena moved for reconsideration, claiming that he received the FAJO Decision dated August 26, 2010 on October 4, 2011.13 The motion, however, was denied for Arcena's failure to show that he received the challenged Decision on October 4, 2011, and that he timely filed his petition for review.14
In the instant case, the exact date in February 2009 that the ND was received by the petitioner cannot be verified, and petitioner failed to state in the petition the actual date of receipt of the ND. Nevertheless, assuming the ND was received on the last day of February - the date most favorable to the petitioner, he consumed 26 days to file his appeal from the ND on March 26, 2009. Upon receipt of the FAIO decision on August 26, 2010, he only had 154 days within which to file an appeal from the said decision or until January 27, 2011.
However, the instant petition was filed before the Commission Proper on March 3, 2011, which is 35 days beyond the six months [sic] reglementary period, as prescribed under Section 3, Rule VII of the 2009 RRPC.
Hence, the appellate jurisdiction of this Commission does not attach, the petition being filed out of time.12 (Emphasis and underscoring supplied; citations omitted.)
Arcena's Petition for Review before the COA Proper was filed out of time. |
In this case, Arcena failed to indicate the date of his receipt of the ND. This failure alone should have warranted the dismissal of the appeal.18 Under the rules, it is required that the petition must state the specific dates to show that it was filed within the prescribed period.19 It must be remembered that a party desiring to appeal an ND must do so strictly in accordance with the COA's Rules of Procedure. Lest it be forgotten, the right to appeal is neither a natural right not a component of due process. Rather, it is a mere statutory privilege, that must be exercised only in the manner and in accordance with the provisions of the law.20RULE V
PROCEEDINGS BEFORE THE DIRECTOR
SEC. 4. When Appeal Taken. - An Appeal must be filed within six (6) months after receipt of the decision appealed from.
SEC. 5. Interruption of Time to Appeal. - The receipt by the Director of the Appeal Memorandum shall stop the running of the period to appeal which shall resume to run upon receipt by the appellant of the Director's decision.RULE VII
PETITION FOR REVIEW TO THE COMMISSION PROPER
SEC. 3. Period to Appeal. - The appeal shall be taken within the time remaining of the six (6) months period under Section 4, Rule V, taking into account the suspension of the ruling period under Section 5 of the same Rule in case of appeals from the Director's decision, x x x.x x x x
SEC 5. Contents of Petition. - The petition for review shall contain a concise statement of the facts and issues involved and the grounds relied upon for the review, and shall be accompanied by a certified true copy of the decision appealed from, together with certified true copies of such relevant portions of the record as are referred to therein and other supporting papers. The petition shall state the specific dates to show that it was filed within the reglementary period.
I. | Section 52 of PD No. 1445 does not apply to transactions in the MBT Projects since the accounts are not yet settled. |
SEC. 52. Opening and revision of settled accounts.In Cruz, Jr. v. Commission on Audit,33 the Court pronounced that the issuance of an Audit Observation Memorandum (AOM) is just an initiatory step in the investigative audit to determine the propriety of disbursements made. It is the disallowance that becomes final and executory absent any motion for reconsideration or appeal. In case the ND is appealed, it is the decision on appeal that becomes final and executory that would settle the account.34 Citing Corales v. Republic,35 The Court enunciated:chanroblesvirtualawlibrary
1. At any time before the expiration of three years after the settlement of any account by an auditor, the Commission may motu propio review and revise the account or settlement and certify a new balance. For that purpose, it may require any account, vouchers, or other papers connected with the matter to be forwarded to it.
2. When any settled account appears to be tainted with fraud, collusion, or error calculation, or when new and material evidence is discovered, or error calculation, or when new and material evidence is discovered, the Commission may, within three years after the original settlement, open the account, and after a reasonable time for reply or appearance of the party concerned, may certify thereon a new balance. An auditor may exercise the same power with respect to settled accounts pertaining to the agencies under his audit jurisdiction.
3. Accounts once finally settled shall m no case be opened or reviewed except as herein provided.
[T]he issuance of the AOM is just an initiatory step in the investigative audit being conducted x x x to determine the propriety of the disbursements made x x x. [A]ny finding or observation by the Auditor stated in the AOM is not yet conclusive, as the comment/justification of the head of office or his duly authorized representative is still necessary before the Auditor can make any conclusion. The Auditor may give due course or find the comment/jurisdiction to be without merit but in either case, the Auditor shall clearly state the reason for the conclusion reached and recommendation made. Subsequent thereto, the Auditor shall transmit the AOM, together with the comment or jurisdiction of the Auditee and the former's recommendation to the Director, Legal and Adjudication Office (DLAO), for the sector concerned in Metro Manila and/or the Regional Legal and Adjudication Cluster Director (RLACD) in the case of regions. The transmittal shall be coursed through the Cluster Director concerned and the Regional Cluster Director, as the case may be, for their own comment and recommendation. The DLAO for the sector concerned in the Central Office and the RLACD shall make the necessary evaluation of the records transmitted with the AOM. When, on the basis thereof, he finds that the transaction should be suspended or disallowed, he will then issue the corresponding Notice of Suspension (NS), Notice of Disallowance (ND) or Notice of Charge (NC), as the case may be, furnishing a copy thereof to the Cluster Director. Otherwise, the Director may dispatch a team to conduct further investigation work to justify the contemplated action. If after in-depth investigation, the DLAO for each sector in Metro Manila and the RLACD for the regions find that the issuance of the NS, ND, and NC is warranted, he shall issue the same and transmit such NS, ND or NC, as the case may be, to the agency head and other persons found liable therefor. From the foregoing, it is beyond doubt that the issuance of an AOM is, indeed, an initial step in the conduct of an investigative audit considering that after its issuance there are still several steps to be conducted before a final conclusion can be made or before the proper action can be had against the Auditee. x x x.36Here, the special audit report is part of the investigative audit of the transactions in the MBT Projects. Its issuance reflected the audit team's findings, the auditee's comments, as well as the rejoinders from the audit team; all of which were considered in coming up with the recommendations, and the consequent release of the ND. Clearly, contrary to Arcena's contention, the MBT Projects are not settled accounts at the time of the conduct of the audit made by the special audit team. In Ramiscal, Jr. v. Commission on Audit,37 the petitioner argued that the ND and Notice of Charge (NC) have already prescribed. The transaction subject of the ND occurred in 1997, and the COA had until 2003 within which to issue the ND or NC. However, it was only in 2004 when the audit investigation transpired and the ND and NC were issued in 2010. The Court noted that the Ombudsman requested the COA to conduct an audit in view of a pending case with the Sandiganbayan. A special audit team was then formed, conducted the first audit in 2004, and in 2005, issued an AOM. The Court validated the audit team's authority pursuant to the COA's investigative and inquisitorial powers under Section 4038 of PD No. 1445. It was also declared that there was no settled account to speak of because the issuance of the AOM was merely an initial step in the audit to determine the propriety of the disbursements made.39 Similarly, the MBT projects are not settled accounts since the audit made entailed several more steps before a final conclusion was made through the issuance of the ND.
II. | The COA's computation is based on substantial evidence and was in accordance with the COA standards. |
The COA estimated cost and the reasonableness of the unit prices/costs obtained by the agency was arrived at using data from the Construction Industry Authority of the Philippines, relevant Price Index published by the National Statistics Offices, DPWH Cost Analysis Manuals and ACEL Rate 1992. Hence, upon proper evaluation of scope of works done including actual measurements using as basis the submitted as-built plans and specifications submitted by Capt. Antonio E. Grado, the COA Senior Technical Audit Specialist arrived at a computed cost of P62,175,931.88 for all the MBT projects.To reiterate, as the duly authorized agency to adjudicate matters relating to the examination, audit, and settlement of all accounts of the government and its expenditures, the COA has acquired special knowledge and expertise in handling matters falling under its specialized jurisdiction. Hence, in the absence of grave abuse of discretion, the factual findings of the COA, which are duly supported by the evidence on record, must be accorded not only great respect but finality.x x x x
[T]he total disbursements of P69,983,698.76 was excessive by P7,807,766.88 x x x compared to the COA estimated cost of P62,175,931.88.x x x x
Finally, after conscientious study, the team found it relevant that the COA evaluation should consider COA Resolution No. 91-52 dated September 17, 1991 in the cost estimates. The projects were actually implemented through Purchase Orders as the documents show. This procedure defied the mandatory requirements for Infrastructure Projects[,] [i.e.], Detailed Engineering, to include among others Approved Agency Estimate (AAE), and Detailed Breakdown of the Contract Cost (CC). These documents should have been used as basis for Cost Comparison between AAE/CC and COA Cost Estimate which the above Resolution is referring to.
In these projects, the COA Quantity Estimates were generally based on the approved original As-Built Plans and Specifications submitted by the agency and actual COA inspection/verification conducted. As there was not any information from the AAE and CC that could be used to compare with the total COA Cost Estimate, a solution was devised in comparing the cost. Thus, Cost Comparison was based on the total [Sub-Allotment Advice] SAA of the subject projects issued less unobligated amounts. SAA was made as basis considering that SAA may be described as Individual Project Cost/Program of Work used for budgetary purposes. Hence, comparing the SAA (less unobligated amounts) with the total COA Cost Estimate showed the following:
Table 1 - without the 10% allowance
Total SAA
(less unobligated amounts) COA Cost Estimate Amount Variance Percent Variance P69,983,698.76 P62,175,931.88 P7,807,766.88 12.56%
Table 2 - with 10% per COA Resolution 91-52
Total SAA
(less unobligated amounts) COA Cost Estimate Amount Variance Percent Variance P69,983,698.76 P68,393,525.10 P1,590,173.66 2.33%
Even if 10% is added to the COA Estimated Project Cost, still the total disbursements for all the projects is higher by 2.33% equivalent to P1,590,173.66.46 (Emphases in the original.)
Liability for the disallowed sum has attained finality. |
Very truly yours, | |
EDGAR O. ARICHETA | |
Clerk of Court | |
By: | |
(SGD.) ANNA-LI R. PAPA-GOMBIO | |
Deputy Clerk of Court En Banc |
Endnotes:
1Rollo, pp. 3-22.
2Id. at 29-32.
3Id. at 33-37.
4 The funding was sourced as follows: P5,001,230.00 - Philippine Navy funds; and P64,982,600.00 - Bases Conversion Development Authority funds; id. at 65.
5 The Report on the Special Audit/Investigation of the 1995-1996 Marine Base Ternate Projects mentioned that the audit was initiated per the 1st Indorsement dated December 19, 2003 of the Office of the Ombudsman; id. at 64.
6Id. at 62-104.
7Id. at 120-128. The Report was subscribed and sworn by the audit team and team supervisor on November 27, 2008; id. at 102.
8Id. at 225-232.
9Id. at 38-52.
N.B. In the Decision of the COA, dated November 24, 2015, the petition was declared as filed on March 3, 2011; id. at 30.
10Id. at 11.
11 Decision No. 2015-289; id. at 29-32. Received by Arcena on January 12, 2016; id. at 7. The dispositive portion of the Decision states:chanroblesvirtualawlibraryWHEREFORE, premises considered. the instant petition for review is hereby DISMISSED for being filed out of time. Accordingly, Commission on Audit-Fraud Audit and Investigation Office Decision No. 2010-002 dated August 26, 2010 which affirmed Notice of Disallowance No. PMAR-MBT-2008-01 dated November 25, 2008 amounting to P1,590,173.66 is FINAL AND EXECUTORY.12Id. at 30.
13 Filed on January 25, 2016 (13 days from receipt of the Decision); id. at 53-61.
14 Decision No. 2016-197 dated August 12, 2016 and was received by the Arcena on September 26, 2016; id. at 33.37. The dispositive portion of the Decision reads:chanroblesvirtualawlibraryWHEREFORE, premises considered, the motion for reconsideration is hereby DENIED. Accordingly, Commission on Audit Decision No. 2015-289 dated November 24, 2015, is hereby AFFIRMED with FINALITY.15 ORDAINING AND INSTITUTING A GOVERNMENT AUDITING CODE OF THE PHILIPPINES; signed on June 11, 1978.
16Id. at 13-18.
17Id. at 209-224.
18 See Philippine Health Insurance Corporation v. Commission on Audit, G.R. No. 235832, November 3, 2020.
19 2009 REVISED RULEs OF PROCEDURE OF THE COMMISSION ON AUDIT, Rule VII, SEC. 5.
20Chozas v. Commission on Audit, G.R. No. 226319, October 8, 2019, citing Boardwalk Business Ventures Inc. v. Villareal (deceased), 708 Phil. 443, 445 (2013), citing Fenequito v. Vergara, Jr., 691 Phil. 335, 341-342 (2012).
21Id. at 40.
22 Counting from January 27, 2011, a petition filed on February 28, 2011 is 32 days late, while a petition filed on March 3, 2011 is 35 days late.
23Atlas Consolidated Mining & Development Corporation v. Commissioner of Internal Revenue, 376 Phil. 495, 506 (1999).
24Rollo, p. 20.
25 See Philhealth v. Commission an Audit, G.R. No. 222710, September 10, 2019.
26Binga Hydroelectric Plant, Inc. v. Commission on Audit and National Power Corporation, 836 Phil. 46, 54 (2018).
27Malixi v. Baltazar, 821 Phil. 423, 435 (2017).
28 See id. at 435-436, citing Le Soleil Int'l. Logistics Co., Inc v. Sanchez, 769 Phil. 466, 473 (2015).
29Rollo, pp. 186-192.
30Id. at 194-195.
31Id. at 195.
32Id.
33 788 Phil. 435 (2016).
34Id. at 445.
35 716 Phil. 432 (2013).
36Cruz, Jr. v. Commission on Audit, supra note 33, at 446-447.
37 819 Phil. 597 (2017).
38 SEC. 40. Investigatory and inquisitorial powers; power to punish for contempt.
1. The Chairman or any Commissioner of the Commission, the central office managers, the regional directors, the auditors of any government agency, and any other official or employee of the Commission specially deputed in writing for the purpose by the Chairman shall, in compliance with the requirement of due process, have the power to summon the parties to a case brought before the Commission for resolution, issue subpoena and subpoena duces tecum, administer oaths, and otherwise take testimony in any investigation or inquiry on any matter within the jurisdiction of the Commission.
2. The Commission shall have the power to punish contempts provided for in the Rules of Court under the same procedure and with the same penalties provided therein. Any violation of any final and executory decision, order or ruling of the Commission shall constitute contempt of the Commission.
39Ramiscal, Jr. v. Commission on Audit, supra at 309, citing Corales v. Republic, supra note 35 at 640-641.
40 CONSTITUTION, ART. IX, SEC. 2(1).
41 CONSTITUTION, ART. IX, SEC. 2(2).
42 POLICY GUIDELINES GOVERNING AUDITORIAL REVIEW AND EVALUATION OF BIDDED INFRASTRUCTURE CONTRACTS.
43Rollo, p. 66.
44Id. at 97.
45Id. at 100.
46Id. at 97-100.
47 See Philippine Health Insurance Corporation v. Commission on Audit, G.R. No. 222710, September 10, 2019.cralawredlibrary