8 Tolentino V Sec of Finance

630 SUPREME COURT REPORTS ANNOTATED
Tolentino vs. Secretary of Finance
*
G.R. No. 115455. August 25, 1994.
ARTURO M. TOLENTINO, petitioner, vs. THE

SECRETARY OF FINANCE and THE
COMMISSIONER OF INTERNAL REVENUE,
respondents.
*
G.R. No. 115525. August 25, 1994.
JUAN T. DAVID, petitioner, vs. TEOFISTO T.

GUINGONA, JR., as Executive Secretary; ROBERTO
DE OCAMPO, as Secretary of Finance; LIWAYWAY
VINZONS-CHATO, as Commissioner of Internal
Revenue; and their AUTHORIZED AGENTS OR
REPRESENTATIVES, respondents.
*
G.R. No. 115543. August 25, 1994.
RAUL S. ROCO and the INTEGRATED BAR OF THE

PHILIPPINES, petitioners, vs. THE SECRETARY OF
THE DEPARTMENT OF FINANCE; THE
COMMISSIONERS OF THE BUREAU OF
INTERNAL REVENUE AND BUREAU OF
CUSTOMS, respondents.
_______________
* EN BANC.
631
VOL. 235, AUGUST 25, 1994 631

G.R. No. 115544. August 25, 1994.*
PHILIPPINE PRESS INSTITUTE, INC.; EGP

PUBLISHING CO., INC.; KAMAHALAN
PUBLISHING CORPORATION; PHILIPPINE
JOURNALISTS, INC.; JOSE L. PAVIA; and OFELIA
L. DIMALANTA, petitioners, vs. HON. LIWAYWAY V.
CHATO, in her capacity as Commissioner of Internal
Revenue; HON. TEOFISTO T. GUINGONA, JR., in his
capacity as Executive Secretary; and HON. ROBERTO
B. DE OCAMPO, in his capacity as Secretary of
Finance, respondents.
G.R. No. 115754. August 25, 1994.*
CHAMBER OF REAL ESTATE AND BUILDERS

ASSOCIATIONS, INC., (CREBA), petitioner, vs. THE
COMMISSIONER OF INTERNAL REVENUE,
respondent.
G.R. No. 115781. August 25, 1994.*
KILOSBAYAN, INC., JOVITO R. SALONGA, CIRILO

A. RIGOS, ERME CAMBA, EMILIO C. CAPULONG,
JR., JOSE T. APOLO, EPHRAIM TENDERO,
FERNANDO SANTIAGO, JOSE ABCEDE,
CHRISTINE TAN, FELIPE L. GOZON, RAFAEL G.
FERNANDO, RAOUL V. VICTORINO, JOSE
CUNANAN, QUINTIN S. DOROMAL, MOVEMENT
OF ATTORNEYS FOR BROTHERHOOD,
INTEGRITY AND NATIONALISM, INC. (“MABINI”),
FREEDOM FROM DEBT COALITION, INC.,
PHILIPPINE BIBLE SOCIETY, INC., and
WIGBERTO TAÑADA, petitioners, vs. THE
EXECUTIVE SECRETARY, THE SECRETARY OF
FINANCE, THE COMMISSIONER OF INTERNAL
REVENUE and THE COMMISSIONER OF
CUSTOMS, respondents.
G.R. No. 115852. August 25, 1994.*
PHILIPPINE AIRLINES, INC. petitioner, vs. THE

SECRETARY OF FINANCE, and COMMISSIONER
OF INTERNAL REVENUE, respondents.
632

G.R. No. 115873. August 25, 1994.*
COOPERATIVE UNION OF THE PHILIPPINES,

petitioners, vs. HON. LIWAYWAY V. CHATO, in her
capacity as the Commissioner of Internal Revenue,
HON. TEOFISTO T. GUINGONA, JR., in his capacity
as Executive Secretary, and HON. ROBERTO B. DE
OCAMPO, in his capacity as Secretary of Finance,
respondents.
G.R. No. 115931. August 25, 1994.*
PHILIPPINE EDUCATIONAL PUBLISHERS

ASSOCIATION, INC., and ASSOCIATION OF
PHILIPPINE BOOKSELLERS, petitioners, vs. HON.
ROBERTO B. DE OCAMPO, as the Secretary of
Finance; HON. LIWAYWAY V. CHATO, as the
Commissioner of Internal Revenue and HON.
GUILLERMO PARAYNO, JR., in his capacity as the
Commissioner of Customs, respondents.
Constitutional Law; Statutes; Taxation; Origin of revenue
bills; A bill originating in the House of Representatives may
undergo such extensive changes in the Senate that the result
may be a rewriting of the whole; As a result of the Senate
action, a distinct bill may be produced and to insist that a
revenue statute must substantially be the same as the House
bill would be to deny the Senate’s power not only to “concur
with amendments” but also to “propose amendments.”—
Petitioners’ contention is that Republic Act No. 7716 did not
“originate exclusively” in the House of Representatives as
required by Art. VI, § 24 of the Constitution, because it is in
fact the result of the consolidation of two distinct bills, H. No.
11197 and S. No. 1630. In this connection, petitioners point
out that although Art. VI, § 24 was adopted from the
American Federal Constitution, it is notable in two respects:
the verb “shall originate” is qualified in the Philippine
Constitution by the word “exclusively” and the phrase “as on
other bills” in the American version is omitted. This means,
according to them, that to be considered as having originated
in the House, Republic Act No. 7716 must retain the essence
of H. No. 11197. This argument will not bear analysis. To
begin with, it is not the law—but the revenue bill—which is
required by the Constitution to “originate exclusively” in the
House of Representatives. It is important to emphasize this,
because a bill originating in the House may undergo such
extensive changes in the Senate that the result may be a
rewriting of the whole. The possibility of a third version by
the conference committee will be discussed later. At this
point, what is important to
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VOL. 235, AUGUST 25, 1994 633
note is that, as a result of the Senate action, a distinct bill

may be produced. To insist that a revenue statute—and not
only the bill which initiated the legislative process
culminating in the enactment of the law—must substantially
be the same as the House bill would be to deny the Senate’s
power not only to “concur with amendments” but also to
“propose amendments.” It would be to violate the coequality
of legislative power of the two houses of Congress and in fact
make the House superior to the Senate.
Same; Same; Same; Same; Legislative power is vested in
the Congress of the Philippines, consisting of “a Senate and a
House of Representatives,” not in any particular chamber.—
The contention that the constitutional design is to limit the
Senate’s power in respect of revenue bills in order to
compensate for the grant to the Senate of the treaty-ratifying
power and thereby equalize its powers and those of the
House overlooks the fact that the powers being compared are
different. We are dealing here with the legislative power
which under the Constitution is vested not in any particular
chamber but in the Congress of the Philippines, consisting of
“a Senate and a House of Represen-tatives.” The exercise of
the treaty-ratifying power is not the exercise of legislative
power. It is the exercise of a check on the executive power.
There is, therefore, no justification for comparing the
legislative powers of the House and of the Senate on the
basis of the possession of such nonlegislative power by the
Senate. The possession of a similar power by the U.S. Senate
has never been thought of as giving it more legislative
powers than the House of Representatives.
Same; Same; Same; Same; There is really no difference
between the Senate preserving the House Bill up to the
enacting clause and then writing its own version following the
enacting clause and, on the other hand, separately presenting
a bill of its own on the same subject matter.—It is insisted,
however, that S. No. 1630 was passed not in substitution of
H. No. 11197 but of another Senate bill (S. No. 1129) earlier
filed and that what the Senate did was merely to “take [H.
No. 11197] into consideration” in enacting S. No. 1630. There
is really no difference between the Senate preserving H. No.
11197 up to the enacting clause and then writing its own
version following the enacting clause (which, it would seem,
petitioners admit is an amendment by substitution), and, on
the other hand, separately presenting a bill of its own on the
same subject matter. In either case the result are two bills on
the same subject.
Same; Same; Same; Same; The Constitution simply
means that the initiative for filing revenue, tariff, or tax bills,
bills authorizing an increase of the public debt, private bills
and bills of local application
634
must come from the House of Representatives and that it does

not prohibit the filing in the Senate of a substitute bill in
anticipation of its receipt of the bill from the House.—Indeed,
what the Constitution simply means is that the initiative for
filing revenue, tariff, or tax bills, bills authorizing an
increase of the public debt, private bills and bills of local
application must come from the House of Representatives on
the theory that, elected as they are from the districts, the
members of the House can be expected to be more sensitive
to the local needs and problems. On the other hand, the
senators, who are elected at large, are expected to approach
the same problems from the national perspective. Both views
are thereby made to bear on the enactment of such laws. Nor
does the Constitution prohibit the filing in the Senate of a
substitute bill in anticipation of its receipt of the bill from the
House, so long as action by the Senate as a body is withheld
pending receipt of the House bill.
Same; Same; Presidential certification on urgency of a
bill dispenses with the requirement not only of printing but
also that of reading the bill on separate days.—The
presidential certification dispensed with the requirement not
only of printing but also that of reading the bill on separate
days. The phrase “except when the President certifies to the
necessity of its immediate enactment, etc.” in Art. VI, § 26(2)
qualifies the two stated conditions before a bill can become a
law: (i) the bill has passed three readings on separate days
and (ii) it has been printed in its final form and distributed
three days before it is finally approved. In other words, the
“unless” clause must be read in relation to the “except”
clause, because the two are really coordinate clauses of the
same sentence. To construe the “except” clause as simply
dispensing with the second requirement in the “unless”
clause (i.e., printing and distribution three days before final
approval) would not only violate the rules of grammar. It
would also negate the very premise of the “except” clause: the
necessity of securing the immediate enactment of a bill which
is certified in order to meet a public calamity or emergency.
For if it is only the printing that is dispensed with by
presidential certification, the time saved would be so
negligible as to be of any use in insuring immediate
enactment. It may well be doubted whether doing away with
the necessity of printing and distributing copies of the bill
three days before the third reading would insure speedy
enactment of a law in the face of an emergency requiring the
calling of a special election for President and Vice-President.
Under the Constitution such a law is required to be made
within seven days of the convening of Congress in emergency
session.
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VOL. 235, AUGUST 25, 1994 635
Same; Same; Judicial Review; While the sufficiency of the

factual basis of the suspension of the writ of habeas corpus or
declaration of martial law is subject to judicial review
because basic rights of individuals may be at hazard, the
factual basis of presidential certification of bills, which
involves doing away with procedural requirements designed
to insure that bills are duly considered by members of
Congress, certainly should elicit a different standard of
review.—It is nonetheless urged that the certification of the
bill in this case was invalid because there was no emergency,
the condition stated in the certification of a “growing budget
deficit” not being an unusual condition in this country. It is
noteworthy that no member of the Senate saw fit to
controvert the reality of the factual basis of the certification.
To the contrary, by passing S. No. 1630 on second and third
readings on March 24, 1994, the Senate accepted the
President’s certification. Should such certifi-cation be now
reviewed by this Court, especially when no evidence has been
shown that, because S. No. 1630 was taken up on second and
third readings on the same day, the members of the Senate
were deprived of the time needed for the study of a vital piece
of legislation? The sufficiency of the factual basis of the
suspension of the writ of habeas corpus or declaration of
martial law under Art. VII, § 18, or the existence of a
national emergency justifying the delegation of extraordinary
powers to the President under Art. VI, § 23(2), is subject to
judicial review because basic rights of individuals may be at
hazard. But the factual basis of presidential certification of
bills, which involves doing away with procedural
requirements designed to insure that bills are duly
considered by members of Congress, certainly should elicit a
different standard of review.
Same; Same; Bicameral Conference Committee; A third
version of the bill may result from the conference committee,
which is considered an “amendment in the nature of a
substitute,” the only requirement being that the third version
be germane to the subject of the House and Senate bills.—As
to the possibility of an entirely new bill emerging out of a
Conference Committee, it has been explained: Under
congressional rules of procedure, conference committees are
not expected to make any material change in the measure at
issue, either by deleting provisions to which both houses
have already agreed or by inserting new provisions. But this
is a difficult provision to enforce. Note the problem when one
house amends a proposal originating in either house by
striking out everything following the enacting clause and
substituting provisions which make it an entirely new bill.
The versions are now altogether different, permitting a
conference committee to draft essentially a new bill . . . . The
result is a third version, which is considered an “amendment
in the nature of a substitute,” the only requirement for
636
which being that the third version be germane to the subject

of the House and Senate bills.
Same; Same; Same; The report of the conference
committee needs the approval of both houses of Congress to
become valid as an act of the legislative department.—Indeed,
this Court recently held that it is within the power of a
conference committee to include in its report an entirely new
provision that is not found either in the House bill or in the
Senate bill. If the committee can propose an amendment
consisting of one or two provisions, there is no reason why it
cannot propose several provisions, collectively considered as
an “amendment in the nature of a substitute,” so long as
such amendment is germane to the subject of the bills before
the committee. After all, its report was not final but needed
the approval of both houses of Congress to become valid as
an act of the legislative department. The charge that in this
case the Conference Committee acted as a third legislative
chamber is thus without any basis.
Same; Same; Same; Separation of Powers; It is common
place in Congress that conference committee reports include
new matters which, though germane, have not been
committed to the committee, and if a change is desired in the
practice, it must be sought in Congress since this question is
not covered by any constitutional provision but is only an
internal rule of each house.—To be sure, nothing in the Rules
limits a conference committee to a consideration of
conflicting provisions. But Rule XLIV, § 112 of the Rules of
the Senate is cited to the effect that “If there is no Rule
applicable to a specific case the precedents of the Legislative
Department of the Philippines shall be resorted to, and as a
supplement of these, the Rules contained in Jefferson’s
Manual.” The following is then quoted from the Jefferson’s
Manual: The managers of a conference must confine
themselves to the differences committed to them . . . and may
not include subjects not within disagreements, even though
germane to a question in issue. Note that, according to Rule
XLIX, § 112, in case there is no specific rule applicable, resort
must be to the legislative practice. The Jefferson’s Manual is
resorted to only as supplement. It is common place in
Congress that conference committee reports include new
matters which, though germane, have not been committed to
the committee. This practice was admitted by Senator Raul
S. Roco, petitioner in G.R. No. 115543, during the oral
argument in these cases. Whatever, then, may be provided in
the Jefferson’s Manual must be considered to have been
modified by the legislative practice. If a change is desired in
the practice it must be sought in Congress since this question
is not covered by any constitutional provision but is only an
internal rule of each house. Thus, Art. VI, §
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VOL. 235, AUGUST 25, 1994 637
16(3) of the Constitution provides that “Each House may

determine the rules of its proceedings . . . .”
Same; Same; Same; Same; Bill-Drafting; The use of
brackets and capital letters to indicate changes is a standard
practice in bill-drafting; The Supreme Court’s concern is with
the procedural requirements of the Constitution for the
enactment of laws, not the enforcement of internal Rules of
Congress since “parliamentary rules are merely procedural
and with their observance the courts have no concern.”—This
observation applies to the other contention that the Rules of
the two chambers were likewise disregarded in the
preparation of the Conference Committee Report because the
Report did not contain a “detailed and sufficiently explicit
statement of changes in, or amendments to, the subject
measure.” The Report used brackets and capital letters to
indicate the changes. This is a standard practice in bill-
drafting. We cannot say that in using these marks and
symbols the Committee violated the Rules of the Senate and
the House. Moreover, this Court is not the proper forum for
the enforcement of these internal Rules. To the contrary, as
we have already ruled, “parliamentary rules are merely
procedural and with their observance the courts have no
concern.” Our concern is with the procedural requirements of
the Constitution for the enactment of laws. As far as these
requirements are concerned, we are satisfied that they have
been faithfully observed in these cases.
Same; Same; Same; Same; The three-reading
requirement refers only to bills introduced for the first time in
either house of Congress, not to the conference committee
report.—Art. VI, § 26(2) must, therefore, be construed as
referring only to bills introduced for the first time in either
house of Congress, not to the conference committee report.
For if the purpose of requiring three readings is to give
members of Congress time to study bills, it cannot be
gainsaid that H. No. 11197 was passed in the House after
three readings; that in the Senate it was considered on first
reading and then referred to a committee of that body; that
although the Senate committee did not report out the House
bill, it submitted a version (S. No. 1630) which it had
prepared by “taking into consideration” the House bill; that
for its part the Conference Committee consolidated the two
bills and prepared a compromise version; that the Conference
Committee Report was thereafter approved by the House and
the Senate, presumably after appropriate study by their
members. We cannot say that, as a matter of fact, the
members of Congress were not fully informed of the
provisions of the bill. The allegation that the Conference
Committee usurped the legislative power of Congress is, in
our view, without warrant in fact and in law.
638
Same; Same; Same; Same; Enrolled Bill Doctrine; An

enrolled copy of a bill is conclusive not only of its provisions
but also of its due enactment.—Whatever doubts there may
be as to the formal validity of Republic Act No. 7716 must be
resolved in its favor. Our cases manifest firm adherence to
the rule that an enrolled copy of a bill is conclusive not only
of its provisions but also of its due enactment. Not even
claims that a proposed constitutional amendment was
invalid because the requisite votes for its approval had not
been obtained or that certain provisions of a statute had been
“smuggled” in the printing of the bill have moved or
persuaded us to look behind the proceedings of a coequal
branch of the government. There is no reason now to depart
from this rule.
Same; Same; Same; Same; Same; While the “enrolled
bill” rule is not absolute, the Supreme Court should decline
the invitation to go behind the enrolled copy of the bill where
allegations that the constitutional procedures for the passage
of bills have not been observed have no more basis than
another allegation that the Conference Committee
“surreptitiously” inserted provisions into a bill which it had
prepared.—No claim is here made that the “enrolled bill” rule
is absolute. In fact in one case we “went behind” an enrolled
bill and consulted the Journal to determine whether certain
provisions of a statute had been approved by the Senate in
view of the fact that the President of the Senate himself, who
had signed the enrolled bill, admitted a mistake and
withdrew his signature, so that in effect there was no longer
an enrolled bill to consider. But where allegations that the
constitutional procedures for the passage of bills have not
been observed have no more basis than another allegation
that the Conference Committee “surreptitiously” inserted
provisions into a bill which it had prepared, we should
decline the invitation to go behind the enrolled copy of the
bill. To disregard the “enrolled bill” rule in such cases would
be to disregard the respect due the other two departments of
our government.
Same; Same; Titles of Bills; The constitutional
requirement that every bill passed by Congress shall embrace
only one subject which shall be expressed in its title is
intended to prevent surprise upon the members of Congress
and to inform the people of pending legislation so that, if they
wish to, they can be heard regarding it.—The question is
whether this amendment of § 103 of the NIRC is fairly
embraced in the title of Republic Act No. 7716, although no
mention is made therein of P.D. No. 1590 as among those
which the statute amends. We think it is, since the title
states that the purpose of the statute is to expand the VAT
system, and one way of doing this is to widen its base by
withdrawing some of the exemptions granted before. To
insist that P.D. No. 1590 be
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VOL. 235, AUGUST 25, 1994 639
mentioned in the title of the law, in addition to § 103 of the

NIRC, in which it is specifically referred to, would be to insist
that the title of a bill should be a complete index of its
content. The constitutional requirement that every bill
passed by Congress shall embrace only one subject which
shall be expressed in its title is intended to prevent surprise
upon the members of Congress and to inform the people of
pending legislation so that, if they wish to, they can be heard
regarding it. If, in the case at bar, petitioner did not know
before that its exemption had been withdrawn, it is not
because of any defect in the title but perhaps for the same
reason other statutes, although published, pass unnoticed
until some event somehow calls attention to their existence.
Indeed, the title of Republic Act No. 7716 is not any more
general than the title of PAL’s own franchise under P.D. No.
1590, and yet no mention is made of its tax exemption.
Same; Same; Same; The trend is to construe the
constitutional requirement in such a manner that courts do
not unduly interfere with the enactment of necessary
legislation.—The trend in our cases is to construe the
constitutional requirement in such a manner that courts do
not unduly interfere with the enactment of necessary
legislation and to consider it sufficient if the title expresses
the general subject of the statute and all its provisions are
germane to the general subject thus expressed.
Same; Same; Public Utilities; Franchises; The grant of a
franchise for the operation of a public utility is subject to
amendment, alteration or repeal by Congress when the
common good so requires.—In contrast, in the case at bar,
Republic Act No. 7716 expressly amends PAL’s franchise
(P.D. No. 1590) by specifically excepting from the grant of
exemptions from the VAT PAL’s exemption under P.D. No.
1590. This is within the power of Congress to do under Art.
XII, § 11 of the Constitution, which provides that the grant of
a franchise for the operation of a public utility is subject to
amendment, alteration or repeal by Congress when the
common good so requires.
Same; Taxation; Expanded Value Added Tax Law; Bill of
Rights; Freedom of Expression; Even with due recognition of
its high estate and its importance in a democratic society, the
press is not immune from general regulation by the State.—To
be sure, we are not dealing here with a statute that on its
face operates in the area of press freedom. The PPI’s claim is
simply that, as applied to newspapers, the law abridges press
freedom. Even with due recognition of its high estate and its
importance in a democratic society, however, the press is not
immune from general regulation by the State.
640

Same; Same; Same; Same; Same; Equal Protection
Clause; The VAT law would perhaps be open to the charge of
discriminatory treatment if the only privilege withdrawn had
been that granted to the press.—What it contends is that by
withdrawing the exemption previously granted to print
media transactions involving printing, publication,
importation or sale of newspapers, Republic Act No. 7716 has
singled out the press for discriminatory treatment and that
within the class of mass media the law discriminates against
print media by giving broadcast media favored treatment.
We have carefully examined this argument, but we are
unable to find a differential treatment of the press by the
law, much less any censorial motivation for its enactment. If
the press is now required to pay a value-added tax on its
transactions, it is not because it is being singled out, much
less targeted, for special treatment but only because of the
removal of the exemption previously granted to it by law. The
withdrawal of exemption is all that is involved in these cases.
Other transactions, likewise previously granted exemption,
have been delisted as part of the scheme to expand the base
and the scope of the VAT system. The law would perhaps be
open to the charge of discriminatory treatment if the only
privilege withdrawn had been that granted to the press. But
that is not the case.
Same; Same; Same; Same; Same; Same; There is a
reasonable basis for the classification and different treatment
between print media and broadcast media.—Nor is
impermissible motive shown by the fact that print media and
broadcast media are treated differently. The press is taxed on
its transactions involving printing and publication, which are
different from the transactions of broadcast media. There is
thus a reasonable basis for the classification.
Same; Same; Same; Same; Freedom of Religion; The Free
Exercise of Religion Clause does not prohibit imposing a
generally applicable sales and use tax on the sale of religious
materials by a religious organization.—What has been said
above also disposes of the allegations of the PBS that the
removal of the exemption of printing, publication or
importation of books and religious articles, as well as their
printing and publication, likewise violates freedom of
thought and of conscience. For as the U.S. Supreme Court
unanimously held in Jimmy Swaggart Ministries v. Board of
Equalization, the Free Exercise of Religion Clause does not
prohibit imposing a generally applicable sales and use tax on
the sale of religious materials by a religious organization.
Same; Same; Same; Same; The VAT registration fee is a
mere administrative fee, one not imposed on the exercise of a
privilege, much less a constitutional right.—In this case, the
fee in § 107, although a
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VOL. 235, AUGUST 25, 1994 641
fixed amount (P1,000), is not imposed for the exercise of a

privilege but only for the purpose of defraying part of the cost
of registration. The registration requirement is a central
feature of the VAT system. It is designed to provide a record
of tax credits because any person who is subject to the
payment of the VAT pays an input tax, even as he collects an
output tax on sales made or services rendered. The
registration fee is thus a mere administrative fee, one not
imposed on the exercise of a privilege, much less a
constitutional right.
Same; Same; Same; Same; Due Process; Hierarchy of
Values; When freedom of the mind is imperiled by law, it is
freedom that commands a momentum of respect and when
property is imperiled, it is the lawmakers’ judgment that
commands respect.—There is basis for passing upon claims
that on its face the statute violates the guarantees of freedom
of speech, press and religion. The possible “chilling effect”
which it may have on the essential freedom of the mind and
conscience and the need to assure that the channels of
communication are open and operating importunately
demand the exercise of this Court’s power of review. There is,
however, no justification for passing upon the claims that the
law also violates the rule that taxation must be progressive
and that it denies petitioners’ right to due process and the
equal protection of the laws. The reason for this different
treatment has been cogently stated by an eminent authority
on constitutional law thus: “[W]hen freedom of the mind is
imperiled by law, it is freedom that commands a momentum
of respect; when property is imperiled it is the lawmakers’
judgment that commands respect. This dual standard may
not precisely reverse the presumption of constitutionality in
civil liberties cases, but obviously it does set up a hierarchy
of values within the due process clause.”
Same; Same; Same; The legislature is not required to
adhere to a policy of “all or none” in choosing the subject of
taxation.—On the other hand, the CUP’s contention that
Congress’ withdrawal of exemption of producers cooperatives,
marketing cooperatives, and service cooperatives, while
maintaining that granted to electric cooperatives, not only
goes against the constitutional policy to promote cooperatives
as instruments of social justice (Art. XII, § 15) but also denies
such cooperatives the equal protection of the law is actually a
policy argument. The legislature is not required to adhere to
a policy of “all or none” in choosing the subject of taxation.
Same; Same; Same; Regressivity is not a negative
standard for courts to enforce since what Congress is required
by the Constitution to do is to “evolve a progressive system of
taxation.”—Indeed, regressivity
642
is not a negative standard for courts to enforce. What

Congress is required by the Constitution to do is to “evolve a
progressive system of taxation.” This is a directive to
Congress, just like the directive to it to give priority to the
enactment of laws for the enhancement of human dignity and
the reduction of social, economic and political inequalities
(Art. XIII, § 1), or for the promotion of the right to “quality
education” (Art. XIV, § 1). These provisions are put in the
Constitution as moral incentives to legislation, not as
judicially enforceable rights.
Same; Same; Same; Contract Clause; Contracts; Not only
are existing laws read into contracts in order to fix obligations
as between parties, but the reservation of essential attributes
of sovereign power is also read into contracts as a basic
postulate of the legal order.—Only slightly less abstract but
nonetheless hypothetical is the contention of CREBA that the
imposition of the VAT on the sales and leases of real estate
by virtue of contracts entered into prior to the effectivity of
the law would violate the constitutional provision that “No
law impairing the obligation of contracts shall be passed.” It
is enough to say that the parties to a contract cannot,
through the exercise of prophetic discernment, fetter the
exercise of the taxing power of the State. For not only are
existing laws read into contracts in order to fix obligations as
between parties, but the reservation of essential attributes of
sovereign power is also read into contracts as a basic
postulate of the legal order. The policy of protecting contracts
against impairment presupposes the maintenance of a
government which retains adequate authority to secure the
peace and good order of society.
Same; Same; Same; Same; Same; Contract Clause is not
a limitation on the power of taxation save only where a tax
exemption was granted for a valid consideration.—In truth,
the Contract Clause has never been thought as a limitation
on the exercise of the State’s power of taxation save only
where a tax exemption has been granted for a valid
consideration. Such is not the case of PAL in G.R. No.
115852, and we do not understand it to make this claim.
Rather, its position, as discussed above, is that the removal
of its tax exemption cannot be made by a general, but only by
a specific, law.
Same; Judicial Review; Public actions by “non-
Hohfeldian” or ideological plaintiffs are now cognizable
provided they meet the standing requirement of the
Constitution; There must be before the Court a fully developed
factual record that alone can impart to its adjudication the
impact of actuality to insure that decision-making is informed
and well-grounded.—The substantive issues raised in some
of the cases are presented in abstract, hypothetical form
because of the lack of a
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VOL. 235, AUGUST 25, 1994 643
concrete record. We accept that this Court does not only

adjudicate private cases; that public actions by “non-
Hohfeldian” or ideological plaintiffs are now cognizable
provided they meet the standing requirement of the
Constitution; that under Art. VIII, § 1, ¶ 2 the Court has a
“special function” of vindicating constitutional rights.
Nonetheless the feeling cannot be escaped that we do not
have before us in these cases a fully developed factual record
that alone can impart to our adjudication the impact of
actuality to insure that decision-making is informed and well
grounded. Needless to say, we do not have power to render
advisory opinions or even jurisdiction over petitions for
declaratory judgment. In effect we are being asked to do
what the Conference Committee is precisely accused of
having done in these cases—to sit as a third legislative
chamber to review legislation.
Same; Same; The duty of the Court to exercise its power
of judicial review must still be performed in the context of a
concrete case or controversy; That the other departments of the
government may have committed a grave abuse of discretion
is not an independent ground for exercising the Court’s power.
—It does not add anything, therefore, to invoke this “duty” to
justify this Court’s intervention in what is essentially a case
that at best is not ripe for adjudication. That duty must still
be performed in the context of a concrete case or controversy,
as Art. VIII, § 5(2) clearly defines our jurisdiction in terms of
“cases,” and nothing but “cases.” That the other departments
of the government may have committed a grave abuse of
discretion is not an independent ground for exercising our
power. Disregard of the essential limits imposed by the case
and controversy requirement can in the long run only result
in undermining our authority as a court of law. For, as
judges, what we are called upon to render is judgment
according to law, not according to what may appear to be the
opinion of the day.
NARVASA, C.J., Separate Opinion:
Constitutional Law; Statutes; Origin of Revenue Bills;

Origination should have no reference to time of conception but
to the affirmative act which effectively puts the bicameral
legislative procedure in motion, i.e., the transmission by one
chamber to the other of a bill for its adoption, and it may be
that in the Senate, revenue or tax measures are discussed,
even drafted, before a similar activity takes place in the
House.—Exclusive origination, I submit, should have no
reference to time of conception. As a practical matter,
origination should refer to the affirmative act which
effectively puts the bicameral legislative procedure in
motion, i.e., the transmission by one chamber to the other of
a bill for its adoption. This is the purposeful act which sets
the legislative machinery in operation
644
to effectively lead to the enactment of a statute. Until this

transmission takes place, the formulation and discussions, or
the reading for three or more times of proposed measures in
either chamber, would be meaningless in the context of the
activity leading towards concrete legislation. Unless
transmitted to the other chamber, a bill prepared by either
house cannot possibly become law. In other words, the first
affirmative, efficacious step, the operative act as it were,
leading to actual enactment of a statute, is the transmission
of a bill from one house to the other for action by the latter.
This is the origination that is spoken of in the Constitution in
its Article VI, Section 24, in reference to appropriation,
revenue, or tariff bills, etc. It may be that in the Senate,
revenue or tax measures are discussed, even drafted, and
this before a similar activity takes place in the House. This is
of no moment, so long as those measures or bills remain in
the Senate and are not sent over to the House. There is no
origination of revenue or tax measures by the Senate in this
case. However, once the House completes the drawing up of a
similar tax measure in accordance with the prescribed
procedure, even if this is done subsequent to the Senate’s
own measure—indeed, even if this be inspired by information
that a measure of the same nature or on the same subject
has been formulated in the Senate—and after third reading
transmits its bill to the Senate, there is origination by (or in)
the House within the contemplation of the Constitution.
Same; Same; Judicial Review; Supreme Court;
Petitioners may not, by raising what are concededly novel and
weighty constitutional questions, compel the Supreme Court
to assume the role of a trier of facts.—The Court will reject a
case where the legal issues raised, whatever they may be,
depend for their resolution on still unsettled questions of
fact. Petitioners may not, by raising what are concededly
novel and weighty constitutional questions, compel the Court
to assume the role of a trier of facts. It is on the contrary
their obligation, before raising those questions to this Court,
to see to it that all issues of fact are settled in accordance
with the procedures laid down by law for proof of facts.
Failing this, petitioners would have only themselves to blame
for a peremptory dismissal.
Same; Same; “Enrolled Bill” Doctrine; Separation of
Powers; There is no proof worthy of the name of any facts to
justify the reexamination and, possibly, disregard, of the
“enrolled bill” theory.—I would myself consider the “enrolled
bill” theory as laying down a presumption of so strong a
character as to be well nigh absolute or conclusive, fully in
accord with the familiar and fundamental philosophy of
separation of powers. The result, as far as I am concerned, is
to make discussion of the enrolled bill principle purely
academic; for as already
645
VOL. 235, AUGUST 25, 1994 645
pointed out, there is no proof worthy of the name of any facts

to justify its reexamination and, possibly, disregard.
Same; Same; Bicameral Conference Committee; Both
chambers of Congress entrust the function of reconciling the
bills to their delegates at a conference committee with full
awareness, and tacit consent, that new provisions may be
included even if not within the “disagreeing provisions.”—The
fact is that conference committees only take up bills which
have already been freely and fully discussed in both
chambers of the legislature, but as to which there is need of
reconciliation in view of “disagreeing provisions” between
them; and both chambers entrust the function of reconciling
the bills to their delegates at a conference committee with
full awareness, and tacit consent, that conformably with
established practice unquestioningly observed over many
years, new provisions may be included even if not within the
“disagreeing provisions” but of which, together with other
changes, they will be given detailed and sufficiently explicit
information prior to voting on the conference committee
version.
Same; Same; Same; It is an unacceptable theorization
that when the BCC report and its proposed bill were
submitted to the Senate and the House, and the members
thereof did not bother to read, or what is worse, having read
did not understand, what was before them.—In any case, all
the changes and revisions, and deletions, made by the
conference committee were all subsequently considered by
and approved by both the Senate and the House, meeting
and voting separately. It is an unacceptable theorization, to
repeat, that when the BCC report and its proposed bill were
submitted to the Senate and the House, and the members
thereof did not bother to read, or what is worse, having read
did not understand, what was before them, or did not realize
that there were new provisions in the reconciled version
unrelated to any “disagreeing provisions,” or that said new
provisions or revisions were effectively concealed from them.
Moreover, it certainly was entirely within the power and
prerogative of either legislative chamber to reject the BCC
bill and require the organization of a new bicameral
conference committee. That this option was not exercised by
either house only proves that the BCC measure was found to
be acceptable as in fact it was approved and adopted by both
chambers.
CRUZ, J., Separate Opinion:
Constitutional Law; Judicial Review; Where a specific

procedure is fixed by the Constitution itself, it should not
suffice for Congress to simply say that the rules have been
observed and flatly consider the
646
matter closed.—I am persuaded even now that where a

specific procedure is fixed by the Constitution itself, it should
not suffice for Congress to simply say that the rules have
been observed and flatly consider the matter closed. It does
not have to be as final as that. I would imagine that the
judiciary, and particularly this Court, should be able to verify
that statement and determine for itself, through the exercise
of its own powers, if the Constitution has, indeed, been
obeyed. In fact, the Court has already said that the question
of whether certain procedural rules have been followed is
justiciable rather than political because what is involved is
the legality and not the wisdom of the act in question. So we
ruled in Sanidad v. Commission on Elections (73 SCRA 333)
on the amendment of the Constitution; in Daza v. Singson
(180 SCRA 496) on the composition of the Commission on
Appointments; and in the earlier case of Tañada v. Cuenco
(100 SCRA 1101) on the organization of the Senate Electoral
Tribunal, among several other cases. By the same token, the
ascertainment of whether a bill underwent the obligatory
three readings in both Houses of Congres should not be
considered an invasion of the territory of the legislature as
this would not involve an inquiry into its discretion in
approving the measure but only the manner in which the
measure was enacted.
Same; Expanded VAT Law; Bicameral Conference
Committee; The resultant enrolled bill did not originate
exclusively in the House of Representatives.—The two bills
were separately introduced in their respective Chambers.
Both retained their independent existence until they reached
the bicameral conference committee where they were
consolidated. It was this consolidated measure that was
finally passed by Congress and submitted to the President of
the Philippines for his approval. House Bill No. 11197
originated in the House of Representatives but this was not
the bill that eventually became R.A. No. 7716. The measure
that was signed into law by President Ramos was the
consolidation of that bill and another bill, viz., Senate Bill
No. 1630, which was introduced in the Senate. The resultant
enrolled bill thus did not originate exclusively in the House of
Representatives. The enrolled bill itself says that part of it
(and it does not matter to what extent) originated in the
Senate.
Same; Same; Same; The participation of the Senate was
not in proposing or concurring with amendments but in
originating its own Senate bill which was not embodied in
but merged with the House bill.—It would have been
different if the only participation of the Senate was in the
amendment of the measure that was originally proposed in
the House of Representatives. But this was not the case. The
participation of the Senate was not in proposing or
concurring with
647
VOL. 235, AUGUST 25, 1994 647
amendments that would have been incorporated in House

Bill No. 11197. Its participation was in originating its own
Senate Bill No. 1630, which was not embodied in but merged
with House Bill No. 11197. Senate Bill No. 1630 was not
even an amendment by substitution, assuming this was
permissible. To “substitute” means “to take the place of; to
put or use in place of another.” Senate Bill No. 1630 did not,
upon its approval, replace (and thus eliminate) House Bill
No. 11197. Both bills retained their separate identities until
they were joined or united into what became the enrolled bill
and ultimately R.A. No. 7716.
PADILLA, J., Separate Opinion:
Constitutional Law; Statutes; Origin of Revenue Bills;

The approval by the Senate of Senate Bill No. 1630, after it
had considered House Bill No. 11197, may be taken as an
amendment by substitution by the Senate not only of Senate
Bill No. 1129 but of House Bill No. 11197 as well.—Since the
Senate is, under the above-quoted constitutional provision,
empowered to concur with a revenue measure exclusively
originating from the House, or to propose amendments
thereto, to the extent of proposing amendments by
SUBSTITUTION to the House measure, the approval by the
Senate of Senate Bill No. 1630, after it had considered House
Bill No. 11197, may be taken, in my view, as an
AMENDMENT BY SUBSTITUTION by the Senate not only
of Senate Bill No. 1129 but of House Bill No. 11197 as well
which, it must be remembered, originated exclusively from
the House.
Same; Same; Separation of Powers; Presidential
Certification of Bills; A becoming respect for a co-equal and
coordinate department of government points that weight and
credibility be given to such Presidential judgment.—We have
here then a situation where the President did certify to the
necessity of Senate Bill No. 1630’s immediate enactment to
meet an emergency and the Senate responded accordingly.
While I would be the last to say that this Court cannot
review the exercise of such power by the President in
appropriate cases ripe for judicial review, I am not prepared
however to say that the President gravely abused his
discretion in the exercise of such power as to require that
this Court overturn his action. We have been shown no fact
or circumstance which would impugn the judgment of the
President, concurred in by the Senate, that there was an
emergency that required the immediate enactment of Senate
Bill No. 1630. On the other hand, a becoming respect for a co-
equal and coordinate department of government points that
weight and credibility be given to such Presidential
judgment.
648
Same; Bill of Rights; Freedom of Expression; R.A. 7716

in imposing a value-added tax on circulation income of
newspapers and similar publications and on income derived
from publishing advertisements in newspapers violates Sec. 4,
Art III of the Constitution.—Rep. Act No. 7716 in imposing a
value-added tax on circulation income of newspapers and
similar publications and on income derived from publishing
advertisements in newspapers, to my mind, violates Sec. 4,
Art. III of the Constitution. Indeed, even the Executive
Department has tried to cure this defect by the issuance of
BIR Regulation No. 11-94 precluding implementation of the
tax in this area. It should be clear, however, that the BIR
regulation cannot amend the law (Rep. Act No. 7716). Only
legislation (as distinguished from administration regulation)
can amend an existing law.
Same; Same; Freedom of Religion; The imposition of the
VAT on the sale and distribution of religious articles must be
struck down for being contrary to Sec. 5, Art. III of the
Constitution.—Similarly, the imposition of the VAT on the
sale and distribution of religious articles must be struck
down for being contrary to Sec. 5, Art. III of the Constitution
which provides: “Sec. 5. No law shall be made respecting an
establishment of religion, or prohibiting the free exercise
thereof. The free exercise and enjoyment of religious
profession and worship, without discrimination or
preference, shall forever be allowed. No religious test shall be
required for the exercise of civil or political rights.”
Same; Same; Taxation; The inherent power of the State to
tax, which is vested in the legislature, includes the power to
determine whom or what to tax, as well as how much to tax.—
CREBA which specifically assails the 10% value-added tax
on the gross selling price of real properties, fails to
distinguish between a sale of real properties primarily held
for sale to customers or held for lease in the ordinary course
of trade or business and isolated sales by individual real
property owners (Sec. 103[s]). That those engaged in the
business of real estate development realize great profits is of
common knowledge and need not be discussed at length here.
The qualification in the law that the 10% VAT covers only
sales of real property primarily held for sale to customers, i.e.
for trade or business thus takes into consideration a
taxpayer’s capacity to pay. There is no showing that the
consequent distinction in real estate sales is arbitrary and in
violation of the equal protection clause of the Constitution.
The inherent power to tax of the State, which is vested in the
legislature, includes the power to determine whom or what to
tax, as well as how much to tax. In the absence of a clear
showing that the tax violates the due process and equal
protection
649
VOL. 235, AUGUST 25, 1994 649
clauses of the Constitution, this Court, in keeping with the

doctrine of separation of powers, has to defer to the
discretion and judgment of Congress on this point.
Same; Same; Franchises; R.A. 7716 can be considered a
special law amending PAL’s franchise.—There can be no
dispute, in my mind, that the clear intent of Congress was to
modify PAL’s franchise with respect to the taxes it has to
pay. To this extent, Rep. Act No. 7716 can be considered as a
special law amending PAL’s franchise and its tax liability
thereunder. That Rep. Act No. 7716 imposes the value-added
taxes on other subjects does not make it a general law which
cannot amend PD No. 1590.
VITUG, J., Separate Opinion:
Constitutional Law; Judicial Review; Separation of

Powers; It is not believed that judicial tyranny is envisioned,
let alone institutionalized, by the people in the 1987
Constitution.—I cannot yet concede to the novel theory, so
challengingly provocative as it might be, that under the 1987
Constitution the Court may now at good liberty intrude, in
the guise of the people’s imprimatur, into every affair of
government. What significance can still then remain, I ask,
of the time honored and widely acclaimed principle of
separation of powers, if at every turn the Court allows itself
to pass upon, at will, the disposition of a co-equal,
independent and coordinate branch in our system of
government. I dread to think of the so varied uncertainties
that such an undue interference can lead to. The respect for
long standing doctrines in our jurisprudence, nourished
through time, is one of maturity not timidity, of stability
rather than quiescence. It has never occurred to me, and
neither do I believe it has been intended, that judicial
tyranny is envisioned, let alone institutionalized, by our
people in the 1987 Constitution. The test of tyranny is not
solely on how it is wielded but on how, in the first place, it
can be capable of being exercised. It is time that any such
perception of judicial omnipotence is corrected.
REGALADO, J., Dissenting Opinion:
Constitutional Law; Expanded VAT Law; The Senate

clearly and deliberately violated the requirements of the
Constitution not only in the origination of the bill but in the
very enactment of R.A. 7716.—This writer consequently
agrees with the clearly tenable proposition of petitioners that
when the Senate passed and approved S.B. No. 1630, had it
certified by the Chief Executive, and thereafter caused its
650
consideration by the bicameral conference committee in total

substitution of H.B. No. 11197, it clearly and deliberately
violated the requirements of the Constitution not only in the
origination of the bill but in the very enactment of Republic
Act No. 7716. Contrarily, the shifting sands of inconsistency
in the arguments adduced for respondents betray such lack
of intellectual rectitude as to give the impression of being
mere rhetorics in defense of the indefensible.
DAVIDE, JR., J., Dissenting Opinion:
Constitutional Law; Expanded VAT Law; R.A. 7716 did

not originate exclusively in the House.—Since R.A. No. 7716
is a revenue measure, it must originate exclusively in the
House—not in the Senate. As correctly asserted by petitioner
Tolentino, on the face of the enrolled copy of R.A. No. 7716, it
is a “CONSOLIDATION OF HOUSE BILL NO. 11197 AND
SENATE BILL NO. 1630.” In short, it is an illicit marriage of
a bill which originated in the House and a bill which
originated in the Senate. Therefore, R.A. No. 7716 did not
originate exclusively in the House.
Same; Same; Origin of Revenue Bills; The Senate cannot
amend by substitution with an entirely new bill of its own any
bill covered by Section 24 of Article VI which the House
transmitted to it because such substitution would indirectly
violate Section 24.—Since the origination is not exclusively
vested in the House of Representatives of the United States,
the Senate’s authority to propose or concur with amendments
is necessarily broader. That broader authority is further
confirmed by the phrase “as on other Bills,” i.e., its power to
propose or concur with amendments thereon is the same as
in ordinary bills. The absence of this phrase in our
Constitution was clearly intended to restrict or limit the
Philippine Senate’s power to propose or concur with
amendments. In the light of the exclusivity of origination and
the absence of the phrase “as on other Bills,” the Philippine
Senate cannot amend by substitution with an entirely new
bill of its own any bill covered by Section 24 of Article VI
which the House of Representatives transmitted to it because
such substitution would indirectly violate Section 24.
Same; Same; Same; Presidential Certification of Bills;
The only revenue bill which could be properly certified on
permissible constitutional grounds is the bill that was
introduced in the House.—I submit, however, that the
Presidential certification is void ab initio not necessarily for
the reason adduced by petitioner Kilosbayan, Inc., but
because it was addressed to the Senate for a bill which is
prohibited from originating therein. The only bill which could
be properly certified on permissible
651
VOL. 235, AUGUST 25, 1994 651

constitutional grounds even if it had already been

transmitted to the Senate is HB No. 11197. As earlier
observed, this was not so certified, although HB No. 9210
(one of those consolidated into HB No. 11197) was certified
on 1 June 1993. Also, the certification of SB No. 1630 cannot,
by any stretch of the imagination, be extended to HB No.
11197 because SB No. 1630 did not substitute HB No. 11197
but SB No. 1129. Considering that the certification of SB No.
1630 is void, its approval on second and third readings in one
day violated Section 26(2), Article VI of the Constitution.
Same; Statutes; Bicameral Conference Committee; The
duty of the BCC is limited to the reconciliation of disagreeing
provisions or the resolution of differences or inconsistencies of
the bills from both Houses of Congress.—Even granting
arguendo that both HB No. 11197 and SB No. 1630 had been
validly approved by both chambers of Congress and validly
referred to the bicameral conference committee, the latter
had very limited authority thereon. It was created “in view of
the disagreeing provisions of” the two bills. Its duty was
limited to the reconciliation of disagreeing provisions or the
resolution of differences or inconsistencies. The committee
recognized that limited authority in the opening paragraph
of its Report when it said: “The Conference Committee on the
disagreeing provisions of House Bill No. 11197 x x x and
Senate Bill No. 1630 x x x.” Under such limited authority, it
could only either (a) restore, wholly or partly, the specific
provisions of HB No. 11197 amended by SB No. 1630, (b)
sustain, wholly or partly, the Senate’s amendments, or (c) by
way of a compromise, to agree that neither provisions in HB
No. 11197 amended by the Senate nor the latter’s
amendments thereto be carried into the final form of the
former.
Same; Same; Same; Doctrine of Ratification; The
doctrine of ratification may apply to minor procedural flaws
or tolerable breaches of the parameters of the bicameral
conference committee’s limited powers but never to violations
of the Constitution.—I cannot agree with the suggestion that
since both the Senate and the House had approved the
bicameral conference committee report and the bill proposed
by it in substitution of HB No. 11197 and SB No. 1630,
whatever infirmities may have been committed by it were
cured by ratification. This doctrine of ratification may apply
to minor procedural flaws or tolerable breaches of the
parameters of the bicameral conference committee’s limited
powers but never to violations of the Constitution. Congress
is not above the Constitution. In the instant case, since SB
No. 1630 was introduced in violation of Section 24, Article VI
of the Constitution, was passed in the Senate in violation of
the “three readings” rule, and was not transmitted to the
House for the completion of the constitutional
652
process of legislation, and HB No. 11197 was not likewise

passed by the Senate on second and third readings, neither
the Senate nor the House could validly approve the
bicameral conference committee report and the proposed bill.
Same; Same; “Enrolled Bill” Doctrine; Invocation of the
“enrolled bill” doctrine is misplaced.—The majority opinion,
however, invokes the enrolled bill doctrine and wants this
Court to desist from looking behind the copy of the assailed
measure as certified by the Senate President and the
Speaker of the House. I respectfully submit that the
invocation is misplaced. First, as to the issue of origination,
the certification in this case explicitly states that R.A. No.
7716 is a “consolidation of House Bill No. 11197 and Senate
Bill No. 1630.” This is conclusive evidence that the measure
did not originate exclusively in the House. Second, the
enrolled bill doctrine is of American origin, and unquestioned
fealty to it may no longer be justified in view of the expanded
jurisdiction of this Court under Section 1, Article VIII of our
Constitution. Third, even under the regime of the 1935
Constitution which did not contain the above provision, this
Court, through Mr. Chief Justice Makalintal, in Astorga vs.
Villegas, declared that it cannot be truly said that Mabanag
vs. Lopez Vito has laid to rest the question of whether the
enrolled bill doctrine or the journal entry rule should be
adhered to in this jurisdiction. Fourth, even in the United
States, the enrolled bill doctrine has been substantially
undercut. This is shown in the disquisitions of Mr. Justice
Reynato S. Puno in his dissenting opinion, citing Sutherland,
Statutory Construction.
ROMERO, J., Dissenting Opinion:
Constitutional Law; Expanded VAT Law; Bicameral

Conference Committee; A bicameral conference committee is a
creature, not of the Constitution, but of the legislative body
under its power to determine rules of its proceeding.—As a
conference committee has been defined: “. . . unlike the joint
committee is two committees, one appointed by each house.
It is normally appointed for a specific bill and its function is
to gain accord between the two houses either by the recession
of one house from its bill or its amendments or by the further
amendment of the existing legislation or by the substitution
of an entirely new bill. Obviously the conference committee is
always a special committee and normally includes the
member who introduced the bill and the chairman of the
committee which considered it together with such other
representatives of the house as seem expedient. (Horack,
Cases and Materials on Legislation [1940] 220. See also Zinn,
Conference Procedure in Congress, 38 ABAJ 864 [1952];
Steiner, The Congressional Conference
653
VOL. 235, AUGUST 25, 1994 653

Committee [U of Ill. Press, 1951]).” From the foregoing
definition, it is clear that a bicameral conference committee
is a creature, not of the Constitution, but of the legislative
body under its power to determine rules of its proceedings
under Article VI, Sec. 16 (3) of the Constitution. Thus, it
draws its life and vitality from the rules governing its
creation.
Same; Same; Same; The Bicameral Conference
Committee exceeded the power and authority granted in the
Rules of its creation.—Even a cursory perusal of the above
outline will convince one that, indeed, the Bicameral
Conference Committee (henceforth to be referred to as
BICAM) exceeded the power and authority granted in the
Rules of its creation. Both Senate and House Rules limit the
task of the Conference Committee in almost identical
language to the settlement of differences in the provisions or
amendments to any bill or joint resolution. If it means
anything at all, it is that there are provisions in subject bill,
to start with, which differ and, therefore, need reconciliation.
Nowhere in the Rules is it authorized to initiate or propose
completely new matter. Although under certain rules on
legislative procedure, like those in Jefferson’s Manual, a
conference committee may introduce germane matters in a
particular bill, such matters should be circumsribed by the
committee’s sole authority and function to reconcile
differences.
Same; Same; Same; Insertion of new matter on the part
of the Bicameral Conference Committee is an ultra vires act
which makes the same void.—Parenthetically, in the Senate
and in the House, a matter is “germane” to a particular bill if
there is a common tie between said matter and the provisions
which tend to promote the object and purpose of the bill it
seeks to amend. If it introduces a new subject matter not
within the purview of the bill, then it is not “germane” to the
bill. The test is whether or not the change represented an
amendment or extension of the basic purpose of the original,
or the introduction of an entirely new and different subject
matter. In the BICAM, however, the germane subject matter
must be within the ambit of the disagreement between the
two Houses. If the “germane” subject is not covered by the
disagreement but it is reflected in the final version of the bill
as reported by the Conference Committee or, if what appears
to be a “germane” matter in the sense that it is “relevant or
closely allied” with the purpose of the bill, was not the
subject of a disagreement between the Senate and the House,
it should be deemed an extraneous matter or even a “rider”
which should never be considered legally passed for not
having undergone the three-day reading requirement.
Insertion of new matter on the part of the BICAM is,
therefore, an ulta vires act which makes the same void.
654

BELLOSILLO, J., Dissenting Opinion:
Constitutional Law; Origin of Revenue Bills; Statutory

Construction; The provision in the Constitution requiring that
all revenue bills shall originate exclusively from the Lower
House is mandatory.—Verily, the provision in our
Constitution requiring that all revenue bills shall originate
exclusively from the Lower House is mandatory. The word
“exclusively” is an “exclusive word,” which is indicative of an
intent that the provision is mandatory. Hence, all American
authorities expounding on the meaning and application of
Sec. 7, par. (1), Art. I, of the U.S. Constitution cannot be used
in the interpretation of Sec. 24, Art. VI, of our 1987
Constitution which has a distinct feature of “exclusiveness”
all its own. Thus, when our Constitution absolutely requires
—as it is mandatory—that a particular bill should
exclusively emanate from the Lower House, there is no
alternative to the requirement that the bill to become valid
law must originate exclusively from that House.
Same; Same; Same; It is the general rule to regard
constitutional provisions as mandatory, and not to leave any
discretion to the will of the legislature to obey or disregard
them.—In the interpretation of constitutions, questions
frequently arise as to whether particular sections are
mandatory or directory. The courts usually hesitate to
declare that a constitutional provision is directory merely in
view of the tendency of the legislature to disregard provisions
which are not said to be mandatory. Accordingly, it is the
general rule to regard constitutional provisions as
mandatory, and not to leave any discretion to the will of the
legislature to obey or disregard them. This presumption as to
mandatory quality is usually followed unless it is
unmistakably manifest that the provisions are intended to be
merely directory. So strong is the inclination in favor of
giving obligatory force to the terms of the organic law that it
has even been said that neither by the courts nor by any
other department of the government may any provision of
the Constitution be regarded as merely directory, but that
each and everyone of its provisions should be treated as
imperative and mandatory, without reference to the rules
and distinguishing between the directory and the mandatory
statutes.
Same; Same; A Senate amendment by substitution
simply means that the bill did not in effect originate from the
lower chamber but from the upper chamber, disguising itself
as a mere amendment of the House version.—In fine, in the
cases cited which were lifted from American authorities, it
appears that the revenue bills in question actually originated
from the House of Representatives and were amended by the
Senate only after they were transmitted to it. Perhaps, if the
factual
655
VOL. 235, AUGUST 25, 1994 655
circumstances in those cases were exactly the same as the

ones at bench, then the subject revenue or tariff bill may be
upheld in this jurisdiction on the principle of substantial
compliance, as they were in the United States, except
possibly in instances where the House bill undergoes what is
now referred to as “amendment by substitutionn,” for that
would be in derogation of our Constitution which vests solely
in the House of Representatives the power to initiate revenue
bills. A Senate amendment by substitution simply means
that the bill in question did not in effect originate from the
lower chamber but from the upper chamber and now
disguises itself as a mere amendment of the House version.
Same; Judicial Review; Courts will not decline the
exercise of jurisdiction upon the suggestion that action might
be taken by political agencies in disregard of the judgment of
the judicial tribunals.—The rule is fixed that the duty in a
proper case to declare a law unconstitutional cannot be
declined and must be performed in accordance with the
deliberate judgment of the tribunal before which the validity
of the enactment is directly drawn into question. When it is
clear that a statute transgresses the authority vested in the
legislature by the Constitution, it is the duty of the courts to
declare the act unconstitutional because they cannot shirk
from it without violating their oaths of office. This duty of the
courts to maintain the Constitution as the fundamental law
of the state is imperative and unceasing; and, as Chief
Justice Marshal said, whenever a statute is in violation of
the fundamental law, the courts must so adjudge and thereby
give effect to the Constitution. Any other course would lead
to the destruction of the Constitutionn. Since the question as
to the constitutionality of a statute is a judicial matter, the
courts will not decline the exercise of jurisdiction upon the
suggestion that action might be taken by political agencies in
disregard of the judgment of the judicial tribunals.
PUNO, J., Dissenting Opinion:
Constitutional Law; Bicameral Conference Committee;

Ex Post Veto Power; There is absolutely no legal warrant for
the bold submission that a Bicameral Conference Committee
possesses the power to add or delete provisions in bills already
approved on third reading by both Houses or an ex post veto
power.—There is absolutely no legal warrant for the bold
submission that a Bicameral Conference Committee
possesses the power to add/delete provisions in bills already
approved on third reading by both Houses or an ex post veto
power. To support this postulate that can enfeeble Congress
itself, respondents cite no constitutional provision, no law,
not even any rule or regulation. Worse,
656
their stance is categorically repudiated by the rules of both

the Senate and the House of Representatives which define
with precision the parameters of power of a Bicameral
Conference Committee.
Same; Same; Same; The thesis that a Bicameral
Conference Committee can wield ex post veto power wages
war against our settled ideals of representative democracy.—
But the thesis that a Bicameral Conference Committee can
wield ex post veto power does not only contravene the rules of
both the Senate and the House. It wages war againt our
settled ideals of representative democracy. For the
inevitable, catastrophic effect of the thesis is to install a
Bicameral Conference Committee as the Third Chamber of
our Congress, similarly vested with the power to make laws
but with the dissimilarity that its laws are not the subject of
a free and full discussion of both Houses of Congress. With
such a vagrant power, a Bicameral Conference Com-mittee
acting as a Third Chamber will be a constitutional
monstrosity.
Same; “Enrolled Bill” Doctrine; The enrolled bill theory is
a historical relic that should not continuously rule us from
the fossilized past.—Respondents seek sanctuary in the
conclusiveness of an enrolled bill to bar any judicial inquiry
on whether Congress observed our constitutional procedure
in the passage of R.A. No. 7716. The enrolled bill theory is a
historical relic that should not continuously rule us from the
fossilized past. It should be immediately emphasized that the
enrolled bill theory originated in England where there is no
written constitution and where Parliament is supreme. In
this jurisdiction, we have a written constitution and the
legislature is a body of limited powers. Likewise, it must be
pointed out that starting from the decade of the 40’s, even
American courts have veered away from the regidity and
unrealism of the conclusiveness of an enrolled bill.
Same; Same; The previous rulings of the Supreme Court
on the conclusiveness of an enrolled bill are no longer good
law.—I am not unaware that this Court has subscribed to
the conclusiveness of an enrolled bill as enunciated in the
1947 lead case of Mabanag v. Lopez Vito, and reiterated in
subsequent cases. With due respect, I submit that these
rulings are no longer good law. Suffice to state that section
313 of the Old Code of Civil Procedure as amended by Act
No. 2210 is no longer in our statute books. It has long been
repealed by the Rules of Court. Mabanag also relied on
jurisprudence and authorities in the United States which are
under severe criticisms by modern scholars. Hence, even in
the United States the conclusiveness of an enrolled bill has
been junked by most of the States.
657
VOL. 235, AUGUST 25, 1994 657

ORIGINAL ACTIONS in the Supreme Court.

Certiorari and prohibition.
The facts are stated in the opinion of the Court.

Arturo M. Tolentino for and in his behalf.
Donna Celeste D. Feliciano and Juan T. David
for petitioners in G.R. No. 115525.
Roco, Bunag, Kapunan, Migallos and Jardeleza
for petitioner R.S. Roco.
Villaraza and Cruz for petitioners in G.R. No.
115544.
Carlos A. Raneses and Manuel M. Serrano for
petitioner in G.R. No. 115754.
Salonga, Hernandez & Allado for Freedom From
Debts Coalition, Inc. & Phil. Bible Society.
Estelito P. Mendoza for petitioner in G.R. No.
115852.
Panganiban, Benitez, Parlade, Africa &
Barinaga Law Offices for petitioners in G.R. No.
115873.
R.B. Rodriguez & Associates for petitioners in
G.R. No. 115931.
Rene A.V. Saguisag for MABINI.
MENDOZA, J.:
The value-added tax (VAT) is levied on the sale, barter

or exchange of goods and properties as well as on the
sale or exchange of services. It is equivalent to 10% of
the gross selling price or gross value in money of goods
or properties sold, bartered or exchanged or of the
gross receipts from the sale or exchange of services.
Republic Act No. 7716 seeks to widen the tax base of
the existing VAT system and enhance its
administration by amending the National Internal
Revenue Code.
These are various suits for certiorari and
prohibition, challenging the constitutionality of
Republic Act No. 7716 on various grounds summarized
in the resolution of July 6, 1994 of this Court, as
follows:
658

I. Procedural Issues:
Does Republic Act No. 7716 violate Art. VI, § 24 of
A. the Constitution?
B. Does it violate Art. VI, § 26(2) of the Constitution?

C. What is the extent of the power of the Bicameral
Conference Committee?
II. Substantive Issues:
A. Does the law violate the following provisions in the

Bill of Rights (Art. III)?
1. § 1
2. § 4
3. § 5
4. § 10
B. Does the law violate the following other provisions of

the Constitution?
1. Art. VI, § 28(1)

2. Art. VI, § 28(3)
These questions will be dealt in the order they are

stated above. As will presently be explained not all of
these questions are judicially cognizable, because not
all provisions of the Constitution are self executing
and, therefore, judicially enforceable. The other
departments of the government are equally charged
with the enforcement of the Constitution, especially
the provisions relating to them.
I. PROCEDURAL ISSUES
The contention of petitioners is that in enacting

Republic Act No. 7716, or the Expanded Value-Added
Tax Law, Congress violated the Constitution because,
although H. No. 11197 had originated in the House of
Representatives, it was not passed by the Senate but
was simply consolidated with the Senate version (S.
No. 1630) in the Conference Committee to produce the
bill which the President signed into law. The following
provisions of the Constitution are cited in support of
the proposition that because Republic Act No. 7716
was passed in this manner, it did
659
VOL. 235, AUGUST 25, 1994 659

not originate in the House of Representatives and it

has not thereby become a law:
Art. VI, § 24: All appropriation, revenue or tariff bills, bills

authorizing increase of the public debt, bills of local
application, and private bills shall originate exclusively in
the House of Representatives, but the Senate may propose or
concur with amendments.
Id., § 26(2): No bill passed by either House shall become a
law unless it has passed three readings on separate days,
and printed copies thereof in its final form have been
distributed to its Members three days before its passage,
except when the President certifies to the necessity of its
immediate enactment to meet a public calamity or
emergency. Upon the last reading of a bill, no amendment
thereto shall be allowed, and the vote thereon shall be taken
immediately thereafter, and the yeas and nays entered in the
Journal.
It appears that on various dates between

1
July 22, 1992
and August 31, 1993, several bills were introduced in
the House of Representatives seeking to amend certain
provisions of the National Internal Revenue Code
relative to the value-added tax or VAT. These bills
were referred to the House Ways and Means
Committee which recommended for approval a
substitute measure, H. No. 11197, entitled
AN ACT RESTRUCTURING THE VALUE-ADDED TAX

(VAT) SYSTEM TO WIDEN ITS TAX BASE AND
ENHANCE ITS ADMINISTRATION, AMENDING FOR
THESE PURPOSES SECTIONS 99, 100, 102, 103, 104, 105,
106, 107, 108 AND 110 OF TITLE IV, 112, 115 AND 116 OF
TITLE V, AND 236, 237 AND 238 OF TITLE IX, AND
REPEALING SECTIONS 113 AND 114 OF TITLE V, ALL
OF THE NATIONAL INTERNAL REVENUE CODE, AS
AMENDED
The bill (H. No. 11197) was considered on second

reading starting November 6, 1993 and, on November
17, 1993, it was approved by the House of
Representatives after third and final reading.
________________
1 H. Nos. 253, 771, 2450, 7033, 8086, 9030, 9210, 9297, 10012 and
10100. (Respondents’ Consolidated Memorandum, Annexes 3-12).
660

It was sent to the Senate on November 23, 1993 and

later referred by that body to its Committee on Ways
and Means.
On February 7, 1994, the Senate Committee
submitted its report recommending approval of S. No.
1630, entitled

107, 108, AND 110 OF TITLE IV, 112 OF TITLE V, AND
236, 237, AND 238 OF TITLE IX, AND REPEALING
SECTIONS 113, 114 AND 116 OF TITLE V, ALL OF THE
NATIONAL INTERNAL REVENUE CODE, AS AMENDED,
AND FOR OTHER PURPOSES
It was stated that the bill was being submitted “in
substitution of Senate Bill No. 1129, taking into
consideration P.S. Res. No. 734 and H.B. No. 11197.”
On February 8, 1994, the Senate began
consideration of the bill (S. No. 1630). It finished
debates on the bill and approved it on second reading
on March 24, 1994. On the same day, it approved the
bill on third reading by the affirmative votes of 13 of
its members, with one abstention.
H. No. 11197 and its Senate version (S. No. 1630)
were then referred to a conference committee which,
after meeting four times (April 13, 19, 21 and 25,
1994), recommended that “House Bill No. 11197, in
consolidation with Senate Bill No. 1630, be approved in
accordance with the attached copy of the bill as
reconciled and approved by the conferees.”
The Conference Committee bill, entitled “AN ACT
RESTRUCTURING THE VALUE-ADDED TAX (VAT)
SYSTEM, WIDENING ITS TAX BASE AND
ENHANCING ITS ADMINISTRATION AND FOR
THESE PURPOSES AMENDING AND REPEALING
THE RELEVANT PROVISIONS OF THE NATIONAL
INTERNAL REVENUE CODE, AS AMENDED, AND
FOR OTHER PURPOSES,” was thereafter approved
by the House of Representatives on April 27, 1994 and
by the Senate on May 2, 1994. The enrolled bill was
then presented to the President of the Philippines who,
on May 5, 1994, signed it. It became Republic Act No.
7716. On May 12, 1994, Republic Act No. 7716 was
published in two newspapers of general circulation
and, on May 28, 1994, it took effect, although
661
VOL. 235, AUGUST 25, 1994 661

its implementation was suspended until June 30, 1994

to allow time for the registration of business entities. It
would have been enforced on July 1, 1994 but its
enforcement was stopped because the Court, by the
vote of 11 to 4 of its members, granted a temporary
restraining order on June 30, 1994.
First. Petitioners’ contention is that Republic Act
No. 7716 did not “originate exclusively” in the House of
Representatives as required by Art. VI, § 24 of the
Constitution, because it is in fact the result of the
consolidation of two distinct bills, H. No. 11197 and S.
No. 1630. In this connection, petitioners point out that
although Art. VI, § 242 was adopted from the American
Federal Constitution, it is notable in two respects: the
verb “shall originate” is qualified in the Philippine
Constitution by the word “exclusively” and the phrase
“as on other bills” in the American version is omitted.
This means, according to them, that to be considered
as having originated in the House, Republic Act No.
7716 must retain the essence of H. No. 11197.
This argument will not bear analysis. To begin with,
it is not the law—but the revenue bill—which is
required by the Constitution to “originate exclusively”
in the House of Representatives. It is important to
emphasize this, because a bill originating in the House
may undergo such extensive changes in the Senate
that the result may be a rewriting of the whole. The
possibility of a third version by the conference
committee will be discussed later. At this point, what
is important to note is that, as a result of the Senate
action, a distinct bill may be produced. To insist that a
revenue statute—and not only the bill which initiated
the legislative process culminating in the enactment of
the law—must substantially be the same as the House
bill would be to deny the Senate’s power not only to
“concur with amendments” but also to “propose
amendments.” It would be to violate the coequality of
legislative power of the two houses of Congress and in
fact make the House superior to the Senate.
The contention that the constitutional design is to
limit the Senate’s power in respect of revenue bills in
order to compensate
________________
2 U.S. CONST., Art. 1, § 7, cl. 1: “All bills for raising revenue shall
originate in the House of Representatives, but the Senate may
propose or concur with amendments, as on other bills.”
662

for the3
grant to the Senate of the treaty-ratifying
power and thereby equalize its powers and those of
the House overlooks the fact that the powers being
compared are different. We are dealing here with the
legislative power which under the Constitution is
vested not in any particular chamber but in the
Congress of the Philippines, consisting
4
of “a Senate
and a House of Representatives.” The exercise of the
treaty-ratifying power is not the exercise of legislative
power. It is the exercise of a check on the executive
power. There is, therefore, no justification for
comparing the legislative powers of the House and of
the Senate on the basis of the possession of such
nonlegislative power by the Senate. The
5
possession of a
similar power by the U.S. Senate has never been
thought of as giving it more legislative powers than the
House of Representatives.
In the United States, the validity of a provision (§
37) imposing an ad valorem tax based on the weight of
vessels, which the U.S. Senate had inserted in the
Tariff Act of 1909, was upheld against the claim that
the provision was a revenue bill which originated in
the Senate in6 contravention of Art. I, § 7 of the U.S.
Constitution. Nor is the power to amend limited to
adding a provision or two in a revenue bill emanating
from the House. The U.S. Senate has gone so far as
changing the whole of bills following the enacting
clause and substituting its own versions. In 1883, for
example, it struck out everything after the enacting
clause of a tariff bill and wrote in its place its own
measure, and the House subsequently accepted the
amendment. The U.S. Senate likewise added 847
amendments to what later became the Payne-Aldrich
Tariff Act of 1909; it dictated the schedules of the
Tariff Act of 1921; it rewrote an extensive tax revision
bill in7 the same year and recast most of the tariff bill of
1922. Given, then, the power of the Senate to propose
amendments, the Senate can propose its own version
even with respect to bills which are required by the
Constitution to originate in the House.
________________
3 Art. VII, § 21.

4 Art. VI, § 1.
5 U.S. CONST., Art. II, § 2, cl. 2.
6 Rainey v. United States, 232 U.S. 309, 58 L. Ed. 117 (1914).
7 F.A. OGG AND P.O. RAY, INTRODUCTION TO AMERICAN
GOVERNMENT 309, n. 2 (1945).
663
VOL. 235, AUGUST 25, 1994 663

It is insisted, however, that S. No. 1630 was passed not

in substitution of H. No. 11197 but of another Senate
bill (S. No. 1129) earlier filed and that what the Senate
did was merely to “take [H. No. 11197] into
consideration” in enacting S. No. 1630. There is really
no difference between the Senate preserving H. No.
11197 up to the enacting clause and then writing its
own version following the enacting clause (which, it
would seem, petitioners admit is an amendment by
substitution), and, on the other hand, separately
presenting a bill of its own on the same subject matter.
In either case the result are two bills on the same
subject.
Indeed, what the Constitution simply means is that
the initiative for filing revenue, tariff, or tax bills, bills
authorizing an increase of the public debt, private bills
and bills of local application must come from the House
of Representatives on the theory that, elected as they
are from the districts, the members of the House can
be expected to be more sensitive to the local needs and
problems. On the other hand, the senators, who are
elected at large, are expected to approach the same
problems from the national perspective. Both views are
thereby made to bear on the enactment of such laws.
Nor does the Constitution prohibit the filing in the
Senate of a substitute bill in anticipation of its receipt
of the bill from the House, so long as action by the
Senate as a body is withheld pending receipt of the
House bill. The Court cannot, therefore, understand
the alarm expressed over the fact that on March 1,
1993, eight months before the House passed H. No.
11197, S. No. 1129 had been filed in the Senate. After
all it does not appear that the Senate ever considered
it. It was only after the Senate had received H. No.
11197 on November 23, 1993 that the process of
legislation in respect of it began with the referral to
the Senate Committee on Ways and Means of H. No.
11197 and the submission by the Committee on
February 7, 1994 of S. No. 1630. For that matter, if the
question were simply the priority in the time of filing
of bills, the fact is that it was in the House that a bill
(H. No. 253) to amend the VAT law was first filed on
July 22, 1992. Several other bills had been filed in the
House before S. No. 1129 was filed in the Senate, and
H. No. 11197 was only a substitute of those earlier
bills.
664

Second. Enough has been said to show that it was
within the power of the Senate to propose S. No. 1630.
We now pass to the next argument of petitioners that
S. No. 1630 did not pass three readings 8
on separate
days as required by the Constitution because the
second and third readings were done on the same day,
March9
24, 1994. But this was because
10
on February 24,
1994 and again on March 22, 1994, the President had
certified S. No. 1630 as urgent. The presidential
certification dispensed with the requirement not only
of printing but also that of reading the bill on separate
days. The phrase “except when the President certifies
to the necessity of its immediate enactment, etc.” in
Art. VI, § 26(2) qualifies the two stated conditions
before a bill can become a law: (i) the bill has passed
three readings on separate days and (ii) it has been
printed in its final form and distributed three days
before it is finally approved.
In other words, the “unless” clause must be read in
relation to the “except” clause, because the two are
really coordinate clauses of the same sentence. To
construe the “except” clause as simply dispensing with
the second requirement in the “unless” clause (i.e.,
printing and distribution three days before final
approval) would not only violate the rules of grammar.
It would also negate the very premise of the “except”
clause: the necessity of securing
_______________
8 Although the 1935 Constitution did not expressly require that

bills must pass three readings in each House, this was clearly
implied from its Art. VI, § 21(2) so that the two Houses by their rules
prescribed three readings for the passage of bills. Later the
requirement was expressly provided in the 1973 Constitution from
which Art. VI, § 26(2) was taken. Art. VIII, § 19(2) of the 1973
document provided: No bill shall become a law unless it has passed
three readings on separate days, and printed copies thereof in its
final form have been distributed to the Members three days before
its passage, except when the Prime Minister certifies to the necessity
of its immediate enactment to meet a public calamity or emergency.
Upon the last reading of a bill, no amendment thereto shall be
allowed, and the vote thereon shall be taken immediately thereafter,
and the yeas and nays entered in the Journal.
9 Respondents’ Consolidated Reply, Annex 14.
10 Memorandum of Petitioner Arturo M. Tolentino, Supplement C.
665
VOL. 235, AUGUST 25, 1994 665

the immediate enactment of a bill which is certified in

order to meet a public calamity or emergency. For if it
is only the printing that is dispensed with by
presidential certification, the time saved would be so
negligible as to be of any use in insuring imme-diate
enactment. It may well be doubted whether doing
away with the necessity of printing and distributing
copies of the bill three days before the third reading
would insure speedy enactment of a law in the face of
an emergency requiring the calling of a special election
for President and Vice-President. Under the
Constitution such a law is required to be made within
seven days
11
of the convening of Congress in emergency
session.
That upon the certification of a bill by the President
the requirement of three readings on separate days
and of printing and distribution can be dispensed with
is supported by the weight of legislative practice. For
example, the bill defining the certiorari jurisdiction of
this Court which, in consolidation with the Senate
version, became Republic Act No. 5440, was passed on
second and third readings in the House of
Representatives on the same day (May 14, 1968) after 12
the bill had been certified by the President as urgent.
There is, therefore, no merit in the contention that
presidential certification dispenses only with the
requirement for the printing of the bill and its
distribution three days before its passage but
________________
11 Art. VII, § 10 provides: “The Congress shall, at ten o’clock in the

morning of the third day after the vacancy in the offices of the
President and Vice-President occurs, convene in accordance with its
rules without need of a call and within seven days enact a law
calling for a special election to elect a President and a Vice-President
to be held not earlier than forty-five days nor later than sixty days
from the time of such call. The bill calling such special election shall
be deemed certified under paragraph 2, Section 26, Article VI of this
Constitution and shall become law upon its approval on third
reading by the Congress. Appro-priations for the special election
shall be charged against any current appropriations and shall be
exempt from the requirements of paragraph 4, Section 25, Article VI
of this Constitution. The convening of the Congress cannot be
suspended nor the special election postponed. No special election
shall be called if the vacancy occurs within eighteen months before
the date of the next presidential election.”
12 JOURNAL OF THE HOUSE OF REPRESENTATIVES, SIXTH
CONGRESS, FOURTH SESSION 398-399 (1968).
666

not with the requirement of three readings on separate

days, also.
It is nonetheless urged that the certification of the
bill in this case was invalid because there was no
emergency, the condition stated in the certification of a
“growing budget deficit” not being an unusual
condition in this country.
It is noteworthy that no member of the Senate saw
fit to controvert the reality of the factual basis of the
certification. To the contrary, by passing S. No. 1630
on second and third readings on March 24, 1994, the
Senate accepted the President’s certification. Should
such certification be now reviewed by this Court,
especially when no evidence has been shown that,
because S. No. 1630 was taken up on second and third
readings on the same day, the members of the Senate
were deprived of the time needed for the study of a
vital piece of legislation?
The sufficiency of the factual basis of the suspension
of the writ of habeas corpus or declaration of martial
law under Art. VII, § 18, or the existence of a national
emergency justifying the delegation of extraordinary
powers to the President under Art. VI, § 23(2), is
subject to judicial review because basic rights of
individuals may be at hazard. But the factual basis of
presidential certification of bills, which involves doing
away with procedural requirements designed to insure
that bills are duly considered by members of Congress,
certainly should elicit a different standard of review.
Petitioners also invite attention to the fact that the
President certified S. No. 1630 and not H. No. 11197.
That is because S. No. 1630 was what the Senate was
considering. When the matter was before the House,
the President likewise certified H. No. 9210 then
pending in the House.
Third. Finally it is contended that the bill which
became Republic Act No. 7716 is the bill which the
Conference Committee prepared by consolidating H.
No. 11197 and S. No. 1630. It is claimed that the
Conference Committee report included provisions not
found in either the House bill or the Senate bill and
that these provisions were “surreptitiously” inserted by
the Conference Committee. Much is made of the fact
that in the last two days of its session on April 21 and
25, 1994 the Committee met behind closed doors. We
are not told, however, whether the provisions were not
the result of the give and take that often mark the
667
VOL. 235, AUGUST 25, 1994 667

proceedings of conference committees.

Nor is there anything unusual or extraordinary
about the fact that the Conference Committee met in
executive sessions. Often the only way to reach
agreement on conflicting provisions is to meet behind
closed doors, with only the conferees present.
Otherwise, no compromise is likely to be made. The
Court is not about to take the suggestion of a cabal or
sinister motive attributed to the conferees on the basis
solely of their “secret meetings” on April 21 and 25,
1994, nor read anything into the incomplete remarks of
the members, marked in the transcript of stenographic
notes by ellipses. The incomplete sentences are
probably due to the stenographer’s own limitations or
to the incoherence that sometimes characterize
conversations. William Safire noted some such lapses
in recorded talks even by recent past Presidents of the
United States.
In any event, in the United States conference
committees had been customarily held in executive
sessions with
13
only the conferees and their staffs in
attendance. Only in November 1975 was a new rule
adopted requiring open sessions. Even then a majority
of either chamber’s 14
conferees may vote in public to
close the meetings.
As to the possibility of an entirely new bill emerging
out of a Conference Committee, it has been explained:
Under congressional rules of procedure, conference

committees are not expected to make any material change in
the measure at issue, either by deleting provisions to which
both houses have already agreed or by inserting new
provisions. But this is a difficult provision to enforce. Note
the problem when one house amends a proposal originating
in either house by striking out everything following the
enacting clause and substituting provisions which make it an
entirely new bill. The versions are now altogether different,
permitting 15
a conference committee to draft essentially a new
bill . . . .
________________
13 Zinn, Conference Procedure in Congress, 38 ABAJ 864-865
(1952).
14 CONG. QUARTERLY 65 (1983); M. JEWELL, THE
LEGISLATIVE PROCESS IN THE UNITED STATES 169 (1986);
LEES AND SHAW, COMMITTEES IN LEGISLATURES 163 (1979).
15 W. KEEFE AND M. OGUL, THE AMERICAN LEGISLATIVE
PROCESS 149 (1985).
668

The result is a third version, which is considered an

“amendment in the nature of a substitute,” the only
requirement for which being that the third version be 16
germane to the subject of the House and Senate bills.
Indeed, this Court recently held that it is within the
power of a conference committee to include in its report
an entirely new provision that is not 17
found either in
the House bill or in the Senate bill. If the committee
can propose an amendment consisting of one or two
provisions, there is no reason why it cannot propose
several provisions, collectively considered as an
“amendment in the nature of a substitute,” so long as
such amendment is germane to the subject of the bills
before the committee. After all, its report was not final
but needed the approval of both houses of Congress to
become valid as an act of the legislative department.
The charge that in this case the Conference Committee
acted as a18 third legislative chamber is thus without
any basis.
________________
16 W. OLESZEK, CONGRESSIONAL PROCEDURES AND

POLICY PROCESS 214 (1984).
17 Philippine Judges Association v. Prado, G.R. No. 105371, Nov.
11, 1993.
18 The charge is an old one. In the United States, the same charge,
including claims that important provisions were being
“surreptitiously added” in the committee, was made in the 1940s.
But no satisfactory alternative to the conference committee has been
devised. And today, given the bicameral nature of the U.S. Congress,
the charge is no longer heard. Compare the following from a 1945
comment: “As a devise for oiling the machinery of legislation,
committees of conference are, under American conditions, useful, if
not indispensable. Nevertheless, they have shortcomings. Without
exception, they work behind closed doors, hold no hearings, and give
their proceedings no publicity. Doubtless it would be difficult for
them to make headway if they did otherwise. Nevertheless, in view
of the power which they wield, strong objection can be, and is, raised.
For, while the committees are supposed to deal only with actual
differences between the houses and to stay well within the bounds
set by the extreme positions which the houses have taken, they often
work into measures, as reported, provisions of their own devising,
even going so far as to rewrite whole sections with the sole purpose
of incorporating the views which the majority members happen to
hold. . . . In practice, this often results in the adoption of important
provisions, more or less surreptitiously added, without consideration
by either house—in other words, legislation nominally by Congress
but
669
VOL. 235, AUGUST 25, 1994 669

Nonetheless, it is argued that under the respective

Rules of the Senate and the House of Representatives
a conference committee can only act on the differing
provisions of a Senate bill and a House bill, and that
contrary to these Rules the Conference Committee
inserted provisions not found in the bills submitted to
it. The following provisions are cited in support of this
contention:
Rules of the Senate

Rule XII:
§ 26. In the event that the Senate does not agree with the
House of Representatives on the provision of any bill or joint
resolution, the differences shall be settled by a conference
committee of both Houses which shall meet within ten days
after their composition.
The President shall designate the members of the
conference committee in accordance with subparagraph (c),
Section 3 of Rule III.
Each Conference Committee Report shall contain a
detailed and sufficiently explicit statement of the changes in
or amendments to the subject measure, and shall be signed by
the conferees.
The consideration of such report shall not be in order
unless the report has been filed with the Secretary of the
Senate and copies thereof have been distributed to the
Members.
(Emphasis added)
Rules of the House of Representatives
Rule XIV:
§ 85. Conference Committee Reports.—In the event that

the House does not agree with the Senate on the
amendments to any bill or
________________
actually by conference committee. Any remedy found will probably take

the form of reducing the need for using conference committees at all; and the
principal suggestion to that end is that bills and resolutions be referred, not,
as now, to separate committees of the two houses, but to joint committees,
which not only would hold single sets of hearings, but might deliberate and
report back bills to the two houses in such agreed form that further
significant differences would not be likely to develop. Arrangements of this
nature yield excellent results in the legislature of Massachusetts. But there
are obstacles to adoption of the plan for Congress, not the least of them
being a natural aversion of House members to joint committees in which
senators seem likely to dominate; and, as indicated below, the outlook for
the reform is problematical.” F.A. OGG AND P.O. RAY, supra note 7 at 310-
311.
670

joint resolution, the differences may be settled by conference

committees of both Chambers.
The consideration of conference committee reports shall
always be in order, except when the journal is being read,
while the roll is being called or the House is dividing on any
question. Each of the pages of such reports shall be signed by
the conferees. Each report shall contain a detailed,
sufficiently explicit statement of the changes in or
amendments to the subject measure.
unless copies thereof are distributed to the Members:
Provided, That in the last fifteen days of each session period
it shall be deemed sufficient that three copies of the report,
signed as above provided, are deposited in the office of the
Secretary General.
(Emphasis added)
To be sure, nothing in the Rules limits a conference

committee to a consideration of conflicting provisions.
But Rule XLIV, § 112 of the Rules of the Senate is cited
to the effect that “If there is no Rule applicable to a
specific case the precedents of the Legislative
Department of the Philippines shall be resorted to, and
as a supplement of these, the Rules contained in
Jefferson’s Manual.” The following is then quoted from
the Jefferson’s Manual:
The managers of a conference must confine themselves to the

differences committed to them . . . and may not include
subjects not within disagreements, even though germane to a
question in issue.
Note that, according to Rule XLIX, § 112, in case there
is no specific rule applicable, resort must be to the
legislative practice. The Jefferson’s Manual is resorted
to only as supplement. It is common place in Congress
that conference committee reports include new matters
which, though germane, have not been committed to
the committee. This practice was admitted by Senator
Raul S. Roco, petitioner in G.R. No. 115543, during the
oral argument in these cases. Whatever, then, may be
provided in the Jefferson’s Manual must be considered
to have been modified by the legislative practice. If a
change is desired in the practice it must be sought in
Congress since this question is not covered by any
constitutional provision but is only an internal rule of
each house. Thus, Art. VI, § 16(3) of the Constitution
provides that “Each House may determine the rules of
its proceedings . . . .”
671
VOL. 235, AUGUST 25, 1994 671

This observation applies to the other contention that

the Rules of the two chambers were likewise
disregarded in the preparation of the Conference
Committee Report because the Report did not contain
a “detailed and sufficiently explicit statement of
changes in, or amendments to, the subject measure.”
The Report used brackets and capital letters to
indicate the changes. This is a standard practice in
bill-drafting. We cannot say that in using these marks
and symbols the Committee violated the Rules of the
Senate and the House. Moreover, this Court is not the
proper forum for the enforcement of these internal
Rules. To the contrary, as we have already ruled,
“parliamentary rules are merely procedural and19 with
their observance the courts have no concern.” Our
concern is with the procedural requirements of the
Constitution for the enactment of laws. As far as these
requirements are concerned, we are satisfied that they
have been faithfully observed in these cases.
Nor is there any reason for requiring that the
Committee’s Report in these cases must have
undergone three readings in each of the two houses. If
that be the case, there would be no end to negotiation
since each house may seek modifications of the
compromise bill. The nature of the bill, therefore,
requires that it be acted upon by each house on a “take
it or leave it” basis, with the only alternative that if it
is not approved by both houses, another conference
committee must be appointed. But then again the
result would still be a compromise measure that may
not be wholly satisfying to both houses.
Art. VI, § 26(2) must, therefore, be construed as
referring only to bills introduced for the first time in
either house of Congress, not to the conference
committee report. For if the purpose of requiring three
readings is to give members of Congress time to study
bills, it cannot be gainsaid that H. No. 11197 was
passed in the House after three readings; that in the
Senate it was considered on first reading and then
referred to a committee of that body; that although the
Senate committee did not report out the House bill, it
submitted a version (S. No. 1630) which it had
prepared by “taking into consideration” the House bill;
that for its part the Conference Committee
consolidated the two bills and prepared a
_________________
19 Osmeña v. Pendatun, 109 Phil. 863, 871 (1960).
672

compromise version; that the Conference Committee

Report was thereafter approved by the House and the
Senate, presumably after appropriate study by their
members. We cannot say that, as a matter of fact, the
members of Congress were not fully informed of the
provisions of the bill. The allegation that the
Conference Committee usurped the legislative power of
Congress is, in our view, without warrant in fact and
in law.
Fourth. Whatever doubts there may be as to the
formal validity of Republic Act No. 20
7716 must be
resolved in its favor. Our cases manifest firm
adherence to the rule that an enrolled copy of a bill is
conclusive not only of its provisions but also of its due
enactment. Not even claims that a proposed
constitutional amendment was invalid because the 21
requisite votes for its approval had not been obtained
or that certain provisions of a statute 22
had been
“smuggled” in the printing of the bill have moved or
persuaded us to look behind the proceedings of a
coequal branch of the government. There is no reason
now to depart from this rule.
No claim is here made that 23 the “enrolled bill” rule is
absolute. In fact in one case we “went behind” an
enrolled bill and consulted the Journal to determine
whether certain provisions of a statute had been
approved by the Senate in view of the fact that the
President of the Senate himself, who had signed the
enrolled bill, admitted a mistake and withdrew his
signature, so that in effect there was no longer an
enrolled bill to consider.
But where allegations that the constitutional
procedures for the passage of bills have not been
observed have no more basis than another allegation
that the Conference Committee “surreptitiously”
inserted provisions into a bill which it had prepared,
we should decline the invitation to go behind the
enrolled copy of the bill. To disregard the “enrolled bill”
rule in such cases would be to disregard the respect
due the other two departments of our government.
________________
20 E.g., Mabanag v. Lopez Vito, 78 Phil. 1 (1947); Casco (Phil.) Inc.
v. Gimenez, 7 SCRA 347 (1963); Morales v. Subido, 27 SCRA 131
(1969).
21 Mabanag v. Lopez Vito, supra note 20.
22 Morales v. Subido, supra note 20.
23 Astorga v. Villegas, 56 SCRA 714 (1974).
673
VOL. 235, AUGUST 25, 1994 673

Fifth. An additional attack on the formal validity of

Republic Act No. 7716 is made by the Philippine
Airlines, Inc., petitioner in G.R. No. 11582, namely,
that it violates Art. VI, § 26(1) which provides that
“Every bill passed by Congress shall embrace only one
subject which shall be expressed in the title thereof.” It
is contended that neither H. No. 11197 nor S. No. 1630
provided for removal of exemption of PAL transactions
from the payment of the VAT and that this was made
only in the Conference Committee bill which became
Republic Act No. 7716 without reflecting this fact in its
title.
The title of Republic Act No. 7716 is:

(VAT) SYSTEM, WIDENING ITS TAX BASE AND
ENHANCING ITS ADMINISTRATION, AND FOR THESE
PURPOSES AMENDING AND REPEALING THE
RELEVANT PROVISIONS OF THE NATIONAL
INTERNAL REVENUE CODE, AS AMENDED, AND FOR
OTHER PURPOSES.
Among the provisions of the NIRC amended is § 103,

which originally read:
§ 103. Exempt transactions.—The following shall be exempt

from the value-added tax:
....
(q) Transactions which are exempt under special laws or
international agreements to which the Philippines is a
signatory.
Among the transactions exempted from the VAT were

those of PAL because it was exempted under its
franchise (P.D. No. 1590) from the payment of all
“other taxes . . . now or in the near future,” in
consideration of the payment by it either of the
corporate income tax or a franchise tax of 2%.
As a result of its amendment by Republic Act No.
7716, § 103 of the NIRC now provides:
§ 103. Exempt transactions.—The following shall be exempt

from the value-added tax:
....
(q) Transactions which are exempt under special laws,
except those granted under Presidential Decree Nos. 66, 529,
972, 1491, 1590. . . .
674

The effect of the amendment is to remove the

exemption granted to PAL, as far as the VAT is
concerned.
The question is whether this amendment of § 103 of
the NIRC is fairly embraced in the title of Republic Act
No. 7716, although no mention is made therein of P.D.
No. 1590 as among those which the statute amends.
We think it is, since the title states that the purpose of
the statute is to expand the VAT system, and one way
of doing this is to widen its base by withdrawing some
of the exemptions granted before. To insist that P.D.
No. 1590 be mentioned in the title of the law, in
addition to § 103 of the NIRC, in which it is specifically
referred to, would be to insist that the title of a bill
should be a complete index of its content.
The constitutional requirement that every bill
passed by Congress shall embrace only one subject
which shall be expressed in its title is intended to
prevent surprise upon the members of Congress and to
inform the people of pending legislation so that, if they
wish to, they can be heard regarding it. If, in the case
at bar, petitioner did not know before that its
exemption had been withdrawn, it is not because of
any defect in the title but perhaps for the same reason
other statutes, although published, pass unnoticed
until some event somehow calls attention to their
existence. Indeed, the title of Republic Act No. 7716 is
not any more general than the title of PAL’s own
franchise under P.D. No. 1590, and yet no mention is
made of its tax exemption. The title of P.D. No. 1590 is:
AN ACT GRANTING A NEW FRANCHISE TO

PHILIPPINE AIRLINES, INC. TO ESTABLISH, OPERATE,
AND MAINTAIN AIRTRANSPORT SERVICES IN THE
PHILIPPINES AND BETWEEN THE PHILIPPINES AND
OTHER COUNTRIES.
The trend in our cases is to construe the constitutional

requirement in such a manner that courts do not
unduly interfere with the enactment of necessary
legislation and to consider it sufficient if the title
expresses the general subject of the statute and all its
provisions 24are germane to the general subject thus
expressed.
________________
24 See, e.g., Alalayan v. National Power Corp., 24 SCRA 172

(1968); Cordero v. Cabatuando, 6 SCRA 418 (1962); Sumulong v.
COMELEC, 73 Phil. 288 (1941).
675
VOL. 235, AUGUST 25, 1994 675

It is further contended that amendment of petitioner’s
franchise may only be made by special law, in view of §
24 of P.D. No. 1590 which provides:
This franchise, as amended, or any section or provision

hereof may only be modified, amended, or repealed expressly
by a special law or decree that shall specifically modify,
amend, or repeal this franchise or any section or provision
thereof.
This provision is evidently intended to prevent the

amendment of the franchise by mere implication
resulting from the enactment of a later inconsistent
statute, in consideration of the fact that a franchise is
a contract which can be altered only by consent of 25the
parties. Thus in Manila Railroad Co. v. Rafferty, it
was held that an Act of the U.S. Congress, which
provided for the payment of tax on certain goods and
articles imported into the Philippines, did not amend
the franchise of plaintiff, which exempted it from all
taxes except those mentioned in its franchise. It was
held that a special law cannot be amended by a general
law.
In contrast, in the case at bar, Republic Act No.
7716 expressly amends PAL’s franchise (P.D. No. 1590)
by specifically excepting from the grant of exemptions
from the VAT PAL’s exemption under P.D. No. 1590.
This is within the power of Congress to do under Art.
XII, § 11 of the Constitution, which provides that the
grant of a franchise for the operation of a public utility
is subject to amendment, alteration or repeal by
Congress when the common good so requires.
II. SUBSTANTIVE ISSUES
A. Claims of Press Freedom, Freedom of Thought and

Religious Freedom
The Philippine Press Institute (PPI), petitioner in G.R.
No. 115544, is a nonprofit organization of newspaper
publishers established for the improvement of
journalism in the Philippines. On the other hand,
petitioner in G.R. No. 115781, the Philippine Bible
Society (PBS), is a nonprofit organization engaged in
the
_______________
25 40 Phil. 224 (1919).
676

printing and distribution of bibles and other religious

articles. Both petitioners claim violations of their
rights under §§ 4 and 5 of the Bill of Rights as a result
of the enactment of the VAT Law.
The PPI questions the law insofar as it has
withdrawn the exemption previously granted to the
press under § 103 (f) of the NIRC. Although the
exemption was subsequently restored by
administrative regulation with respect to the
circulation income of newspapers, the PPI presses its
claim because of the possibility that the exemption
may still be removed by mere revocation of the
regulation of the Secretary of Finance. On the other
hand, the PBS goes so far as to question the
Secretary’s power to grant exemption for two reasons:
(1) The Secretary of Finance has no power to grant tax
exemption because this is vested in Congress and
requires for
26
its exercise the vote of a majority of all its
members and (2) the Secretary’s duty is to execute the
law. § 103 of the NIRC contains a list of transactions
exempted from VAT. Among the transactions
previously granted exemption were:
(f) Printing, publication, importation or sale of books and any

newspaper, magazine, review, or bulletin which appears at
regular intervals with fixed prices for subscription and sale
and which is devoted principally to the publication of
advertisements.
Republic Act No. 7716 amended § 103 by deleting ¶ (f)

with the result that print media became subject to the
VAT with respect to all aspects of their operations.
Later, however, based on a memorandum of the
Secretary of Justice, respondent Secretary of Finance
issued Revenue Regulations No. 11-94, dated June 27,
1994, exempting the “circulation income of print media
pursuant to § 4 Article III of the 1987 Philippine
Constitution guaranteeing against abridgment of
freedom of the press, among others.” The exemption of
“circulation income” has left income from
advertisements still subject to the VAT.
It is unnecessary to pass upon the contention that
the exemption granted is beyond the authority of the
Secretary of Finance to
________________
26 Art. VI, § 28(4) provides: “No law granting any tax exemption
shall be passed without the concurrence of a majority of all the
Members of the Congress.”
677
VOL. 235, AUGUST 25, 1994 677

give, in view of PPI’s contention that even with the

exemption of the circulation revenue of print media
there is still an unconstitutional abridgment of press
freedom because of the imposition of the VAT on the
gross receipts of newspapers from advertisements and
on their acquisition of paper, ink and services for
publication. Even on the assumption that no
exemption has effectively been granted to print media
transactions, we find no violation of press freedom in
these cases.
To be sure, we are not dealing here with a statute
that on its face operates in the area of press freedom.
The PPI’s claim is simply that, as applied to
newspapers, the law abridges press freedom. Even
with due recognition of its high estate and its
importance in a democratic society, however, the press
is not immune from general regulation by the State. It
has been held:
The publisher of a newspaper has no immunity from the

application of general laws. He has no special privilege to
invade the rights and liberties of others. He must answer for
libel. He may be punished for contempt of court . . . . Like
others, he must pay27 equitable and nondiscriminatory taxes
on his business . . . .
The PPI does not dispute this point, either.

What it contends is that by withdrawing the
exemption previously granted to print media
transactions involving printing, publication,
importation or sale of newspapers, Republic Act No.
7716 has singled out the press for discriminatory
treatment and that within the class of mass media the
law discriminates against print media by giving
broadcast media favored treatment. We have carefully
examined this argument, but we are unable to find a
differential treatment of the press by the law, much
less any censorial motivation for its enactment. If the
press is now required to pay a value-added tax on its
transactions, it is not because it is being singled out,
much less targeted, for special treatment but only
because of the removal of the exemption previously
granted to it by law. The withdrawal of exemption is
all that is involved in these cases. Other transactions,
likewise previously granted exemption, have been
delisted as part of the
_______________
27 Associated Press v. NLRB, 301 U.S. 103, 132, 81 L.Ed. 953, 961
(1937).
678

scheme to expand the base and the scope of the VAT

system. The law would perhaps be open to the charge
of discriminatory treatment if the only privilege
withdrawn had been that granted to the press. But
that is not the case.
The situation in the case at bar is indeed a far cry
from those cited by the PPI in support of its claim that
Republic Act No. 7716 subjects the press to
discriminatory taxation. In the cases cited, the
discriminatory purpose was clear either from the
background of the law or from its operation. 28
For
example, in Grosjean v. American Press Co., the law
imposed a license tax equivalent to 2% of the gross
receipts derived from advertisements only on
newspapers which had a circulation of more than
20,000 copies per week. Because the tax was not based
on the volume of advertisement alone but was
measured by the extent of its circulation as well, the
law applied only to the thirteen large newspapers in
Louisiana, leaving untaxed four papers with
circulation of only slightly less than 20,000 copies a
week and 120 weekly newspapers which were in
serious competition with the thirteen newspapers in
question. It was well known that the thirteen
newspapers had been critical of Senator Huey Long,
and the Long-dominated legislature of Louisiana
responded by taxing what Long described as the “lying
newspapers” by imposing on them “a tax on lying.” The
effect of the tax was to curtail both their revenue and
their circulation. As the U.S. Supreme Court noted, the
tax was “a deliberate and calculated device in the guise
of a tax to limit the circulation of information to which
the public is29
entitled in virtue of the constitutional
guaranties.” The case is a classic illustration of the
warning that the power
30
to tax is the power to destroy.
In the other case invoked by the PPI, the press was
also found to have been singled out because everything
was exempt from the “use tax” on ink and paper,
except the press. Minnesota imposed a tax on the sales
of goods in that state. To protect the sales tax, it
enacted a complementary tax on the privilege of
“using, storing or consuming in that state tangible
personal
_______________
28 297 U.S. 233, 80 L.Ed. 660 (1936).

29 297 U.S. at 250, 80 L.Ed. at 669.
30 Minneapolis Star v. Minnesota Commissioner of Revenue, 460
U.S. 575, 75 L.Ed.2d 295 (1983).
679
VOL. 235, AUGUST 25, 1994 679

property” by eliminating the residents’ incentive to get

goods from outside states where the sales tax might be
lower. The Minnesota Star Tribune was exempted from
both taxes from 1967 to 1971. In 1971, however, the
state legislature amended the tax scheme by imposing
the “use tax” on the cost of paper and ink used for
publication. The law was held to have singled out the
press because (1) there was no reason for imposing the
“use tax” since the press was exempt from the sales tax
and (2) the “use tax” was laid on an “intermediate
transaction rather than the ultimate retail sale.”
Minnesota had a heavy burden of justifying the
differential treatment and it failed to do so. In
addition, the U.S. Supreme Court found the law to be
discriminatory because the legislature, by again
amending the law so as to exempt the first $100,000 of
paper and ink used, further narrowed the coverage of
the tax so that “only a handful of publishers pay any
tax at
31
all and even fewer pay any significant amount of
tax.” The discriminatory purpose was thus very clear.
More recently,
32
in Arkansas Writers’ Project, Inc. v.
Ragland, it was held that a law which taxed general
interest magazines but not newspapers and religious,
professional, trade and sports journals was
discriminatory because while the tax did not single out
the press as a whole, it targeted a small group within
the press. What is more, by differentiating on the basis
of contents (i.e., between general interest and special
interests such as religion or sports) the law became
“entirely incompatible with the First Amendment’s
guarantee of freedom of the press.”
These cases come down to this: that unless justified,
the differential treatment of the press creates risks of
suppression of expression. In contrast, in the cases at
bar, the statute applies to a wide range of goods and
services. The argument that, by imposing the VAT only
on print media whose gross sales exceeds P480,000
33
but
not more than P750,000, the law discriminates is
________________
31 460 U.S. at 591, 75 L.Ed.2d at 308-9 (1983).

32 481 U.S. 221, 95 L.Ed.2d 209 (1987).
33 § 103(t) of the NIRC exempts from the VAT “Sale or lease of
goods or properties or the performance of services other than the
transactions mentioned in the preceding paragraphs, the gross
annual sales and/or receipts [of which] do not exceed the amount
prescribed in regulations to be promulgated by the President upon
the recommendation
680

without merit since it has not been shown that as a
result the class subject to tax has been unreasonably
narrowed. The fact is that this limitation does not
apply to the press alone but to all sales. Nor is
impermissible motive shown by the fact that print
media and broadcast media are treated differently. The
press is taxed on its transactions involving printing
and publication, which are different from the
transactions of broadcast media. There is thus a
reasonable basis for the classification.
The cases canvassed, it must be stressed, eschew
any suggestion that “owners of newspapers are
immune from any forms of ordinary taxation.” The
license tax in the Grosjean case was declared invalid
because it was “one single in kind, with a long history
34
of hostile misuse against the freedom of the press.”
On the other hand, Minneapolis Star acknowledged
that “The First Amendment does not prohibit all
regulation of the press [and that] the States and the
Federal Government can subject newspapers to
generally applicable economic 35regulations without
creating constitutional problems.”
What has been said above also disposes of the
allegations of the PBS that the removal of the
exemption of printing, publication or importation of
books and religious articles, as well as their printing
and publication, likewise violates freedom of thought
and of conscience. For as the U.S. Supreme Court
unanimously held in Jimmy
36
Swaggart Ministries v.
Board of Equalization, the Free Exercise of Religion
Clause does not prohibit imposing a generally
applicable sales and use tax on the sale of religious
materials by a religious organization.
This brings us to the question 37
whether the
registration provision of the law, although of general
applicability, nonetheless is
_________________
by the Secretary of Finance which shall not be less than Four
hundred eighty thousand pesos (P480,000.00) or more than Seven
hundred twenty thousand pesos (P720,000.00) subject to tax under
Section 112 of this Code.”
34 297 U.S. at 250, 80 L.Ed. at 668.
35 460 U.S. at 581, 75 L.Ed.2d at 302.
36 493 U.S. 378, 107 L.Ed.2d 796 (1990).
37 § 107 of the NIRC provides: “Any person subject to a value
added tax under Sections 100 and 102 of this Code shall register
with the appropriate Revenue District Officer and pay an annual
registration
681
VOL. 235, AUGUST 25, 1994 681

invalid when applied to the press because it lays a

prior restraint on its essential freedom. 38The case of
American Bible Society v. City of Manila is cited by
both the PBS and the PPI in support of their
contention that the law imposes censorship. There, this
Court held that an ordinance of the City of Manila,
which imposed a license fee on those engaged in the
business of general merchandise, could not be applied
to the appellant’s sale of bibles and other religious
literature. This
39
Court relied on Murdock v.
Pennsylvania, in which it was held that, as a license
fee is fixed in amount and unrelated to the receipts of
the taxpayer, the license fee, when applied to a
religious sect, was actually being imposed as a
condition for the exercise of the sect’s right under the
Constitution. For that reason, it was held, the license
fee “restrains in advance those constitutional liberties
of press and religion
40
and inevitably tends to suppress
their exercise.”
But, in this case, the fee in § 107, although a fixed
amount (P1,000), is not imposed for the exercise of a
privilege but only for the purpose of defraying part of
the cost of registration. The registration requirement is
a central feature of the VAT system. It is designed to
provide a record of tax credits because any person who
is subject to the payment of the VAT pays an input tax,
even as he collects an output tax on sales made or
services rendered. The registration fee is thus a mere
administrative fee, one not imposed on the exercise of a
privilege, much less a constitutional right.
________________
fee in the amount of One thousand pesos (P1,000.00) for every

separate or distinct establishment or place of business and every
year thereafter on or before the last day of January. Any person just
commencing a business subject to the value-added tax must pay the
fee before engaging therein . . .”
38 101 Phil. 386 (1957).
39 319 U.S. 105, 113, 87 L.Ed. 1292 (1943).
40 319 U.S. at 114, 87 L.Ed. 1292 at 1298. For the same reason, in
People v. Korins, 385 N.Y.S. 2d 474 (1976) a decision of the city court
of Utica, Oneida County held that to apply an ordinance requiring a
business license to be obtained before a person could sell newspapers
in the streets would be to impose a prior restraint on press freedom
because “a newspaper is not in the same category as pineapple or a
soap powder or a pair of shoes” whose sale may be conditioned on the
possession of a business license.
682

For the foregoing reasons, we find the attack on

Republic Act No. 7716 on the ground that it offends the
free speech, press and freedom of religion guarantees
of the Constitution to be without merit. For the same
reasons, we find the claim of the Philippine
Educational Publishers Association (PEPA) in G.R. No.
115931 that the increase in the price of books and
other educational materials as a result of the VAT
would violate the constitutional mandate to the
government to give priority to education, science and
technology (Art. II, § 17) to be untenable.
B. Claims of Regressivity, Denial of Due Process, Equal

Protection, and Impairment of Contracts
There is basis for passing upon claims that on its face
the statute violates the guarantees of freedom of
speech, press and religion. The possible “chilling effect”
which it may have on the essential freedom of the mind
and conscience and the need to assure that the
channels of communication are open and operating
importunately demand the exercise of this Court’s
power of review.
There is, however, no justification for passing upon
the claims that the law also violates the rule that
taxation must be progressive and that it denies
petitioners’ right to due process and the equal
protection of the laws. The reason for this different
treatment has been cogently stated by an eminent
authority on constitutional law thus: “[W]hen freedom
of the mind is imperiled by law, it is freedom that
commands a momentum of respect; when property is
imperiled it is the lawmakers’ judgment that
commands respect. This dual standard may not
precisely reverse the presumption of constitutionality
in civil liberties cases, but obviously it does set 41
up a
hierarchy of values within the due process clause.”
Indeed, the absence of threat of immediate harm
makes the need for judicial intervention less evident
and underscores the essential nature of petitioners’
attack on the law on the grounds of regressivity, denial
of due process and equal protection and
________________
41 P.A. FREUND, ON UNDERSTANDING THE SUPREME

COURT II (1950), quoted in Ermita, Malate Hotel and Motel
Operators Ass’n v. City Mayor, 21 SCRA 449, 459 (1967).
683
VOL. 235, AUGUST 25, 1994 683
impairment of contracts as a mere academic discussion

of the merits of the law. For the fact is that there have
even been no notices of assessments issued to
petitioners and no determinations at the
administrative levels of their claims so as to illuminate
the actual operation of the law and enable us to reach
sound judgment regarding so fundamental questions
as those raised in these suits.
Thus, the broad argument against the VAT is that it
is regressive and that it violates the requirement that
“The rule of taxation shall be uniform and equitable
[and] Congress
42
shall evolve a progressive system of
taxation.” Petitioners in G.R. No. 115781 quote from a
paper, entitled “VAT Policy Issues: Structure,
Regressivity, Inflation and Exports” by Alan A. Tait of
the International Monetary Fund, that “VAT payment
by low-income households will be a higher proportion
of their incomes (and expenditures) than payments by
higher-income households. That is, the VAT will be
regressive.” Petitioners contend that as a result of the
uniform 10% VAT, the tax on consumption goods of
those who are in the higher-income bracket, which
before were taxed at a rate higher than 10%, has been
reduced, while basic commodities, which before were
taxed at rates ranging from 3% to 5%, are now taxed at
a higher rate.
Just as vigorously as it is asserted that the law is
regressive, the opposite claim is pressed by
respondents that in fact it distributes the tax burden to
as many goods and services as possible particularly to
those which are within the reach of higher-income
groups, even as the law exempts basic goods and
services. It is thus equitable. The goods and properties
subject to the VAT are those used or consumed by
higher-income groups. These include real properties
held primarily for sale to customers or held for lease in
the ordinary course of business, the right or privilege
to use industrial, commercial or scientific equipment,
hotels, restaurants and similar places, tourist buses,
and the like. On the other hand, small business
establishments, with annual gross sales of less than
P500,000, are exempted. This,
_________________
42 Art. VI, § 28(1). Related to this argument is the claim that

Republic Act No. 7716 likewise infringes the Due Process and Equal
Protection Clauses of the Bill of Rights, Art. III, § 1(1).
684

according to respondents, removes from the coverage of

the law some 30,000 business establishments.
43
On the
other hand, an occasional paper of the Center for
Research and Communication cites a NEDA study that
the VAT has minimal impact on inflation and income
distribution and that while additional expenditure for
the lowest income class is only P301 or 1.49% a year,
that for a family earning P500,000 a year or more is
P8,340 or 2.2%.
Lacking empirical data on which to base any
conclusion regarding these arguments, any discussion
whether the VAT is regressive in the sense that it will
hit the “poor” and middle-income group in society
harder than it will the “rich,” as the Cooperative Union
of the Philippines (CUP) claims in G.R. No. 115873, is
largely an academic exercise. On the other hand, the
CUP’s contention that Congress’ withdrawal of
exemption of producers cooperatives, marketing
cooperatives, and service cooperatives, while
maintaining that granted to electric cooperatives, not
only goes against the constitutional policy to promote
cooperatives as instruments of social justice (Art. XII, §
15) but also denies such cooperatives the equal
protection of the law is actually a policy argument. The
legislature is not required to adhere to a policy
44
of “all
or none” in choosing the subject of taxation.
Nor is the contention of the Chamber of Real Estate
and Builders Association (CREBA), petitioner in G.R.
115754, that the VAT will reduce the mark up of its
members by as much as 85% to 90% any more
concrete. It is a mere allegation. On the other hand,
the claim of the Philippine Press Institute, petitioner
in G.R. No. 115544, that the VAT will drive some of its
members out of circulation because their profits from
advertisements will not be enough to pay for their tax
liability, while purporting to be based on the financial
statements of the newspapers in question, still falls
short of the establishment of facts by evidence so
necessary for adjudicating the question whether the
tax is oppressive and confiscatory.
Indeed, regressivity is not a negative standard for
courts to enforce. What Congress is required by the
Constitution to do is to
_______________
43 Neri, “In Support of the Expanded Value-Added Tax,” (CRC

Economic Policy Papers No. 5 1994) pp. 3-4.
44 Cf. Lutz v. Araneta, 98 Phil. 148, 153 (1955).
685
VOL. 235, AUGUST 25, 1994 685

“evolve a progressive system of taxation.” This is a

directive to Congress, just like the directive to it to give
priority to the enactment of laws for the enhancement
of human dignity and the reduction of social, economic
and political inequalities (Art. XIII, § 1), or for the
promotion of the right to “quality education” (Art. XIV,
§ 1). These provisions are put in the Constitution as
moral incentives to legislation, not as judicially
enforceable rights. 45
At all events, our 1988 decision in Kapatiran
should have laid to rest the questions now raised
against the VAT. There similar arguments made
against the original VAT Law (Executive Order No.
273) were held to be hypothetical, with no more basis
than newspaper articles which this Court found to be
“hearsay and [without] evidentiary value.” As Republic
Act No. 7716 merely expands the base of the VAT
system and its coverage as provided in the original
VAT Law, further debate on the desirability and
wisdom of the law should have shifted to Congress.
Only slightly less abstract but nonetheless
hypothetical is the contention of CREBA that the
imposition of the VAT on the sales and leases of real
estate by virtue of contracts entered into prior to the
effectivity of the law would violate the constitutional
provision that “No law impairing the obligation of
contracts shall be passed.” It is enough to say that the
parties to a contract cannot, through the exercise of
prophetic discernment, fetter the exercise of the taxing
power of the State. For not only are existing laws read
into contracts in order to fix obligations as between
parties, but the reservation of essential attributes of
sovereign power is also read into contracts as a basic
postulate of the legal order. The policy of protecting
contracts against impairment presupposes the
maintenance of a government which retains adequate
authority
46
to secure the peace and good order of
society.
In truth, the Contract Clause has never been
thought as a limitation on the exercise of the State’s
power of taxation save
_________________
45 Kapatiran ng mga Naglilingkod sa Pamahalaan ng Pilipinas,

Inc. v. Tan, 163 SCRA 371.
46 Cf. Philippine American Life Ins. Co. v. Auditor General, 22
SCRA 135 (1968).
686

only where a tax exemption

47
has been granted for a
valid consideration. Such is not the case of PAL in
G.R. No. 115852, and we do not understand it to make
this claim. Rather, its position, as discussed above, is
that the removal of its tax exemption cannot be made
by a general, but only by a specific, law.
The substantive issues raised in some of the cases
are presented in abstract, hypothetical form because of
the lack of a concrete record. We accept that this Court
does not only adjudicate private
48
cases; that public
actions by “non-Hohfeldian” or ideological plaintiffs
are now cognizable provided they meet the standing
requirement of the Constitution; that under Art. VIII,
§ 1, ¶ 2 the Court has a “special function” of
vindicating constitutional rights. Nonetheless the
feeling cannot be escaped that we do not have before us
in these cases a fully developed factual record that
alone can 49
impart to our adjudication the impact of
actuality to insure that decision-making is informed
and well grounded. Needless to say, we do not have
power to render advisory opinions or even jurisdiction
over petitions for declaratory judgment. In effect we
are being asked to do what the Conference Committee
is precisely accused of having done in these cases—to
sit as a third legislative chamber to review legislation.
________________
47 See E. M. FERNANDO, THE CONSTITUTION OF THE

PHILIPPINES 560-561 (2d Ed., 1977).
48 The term is Professor Jaffe’s (JUDICIAL CONTROL OF
ADMINISTRATIVE ACTION (1965) adopted by Justice Harlan in
his dissent in Flast v. Cohen, 392 U.S. 83, 119-120, L.Ed.2d 947, 973
(1968) to distinguish between the personal and proprietary interest
of traditional plaintiffs and the public interest of a citizen suing in a
public action. The term was mentioned by some members of this
Court in the Lotto case (Kilosbayan, Inc. v. Guingona, G.R. No.
113375, May 5, 1994).
49 Compare Justice Laurel: “Even then, this power of judicial
review is limited to actual cases and controversies to be exercised
after full opportunity of argument by the parties, and limited further
to the constitutional question raised or the very lis mota presented.
Any attempt at abstraction could only lead to dialectics and barren
legal questions and to sterile conclusions unrelated to actualities.”
Angara v. Electoral Commission, 63 Phil. 139, 158 (1936).
687
VOL. 235, AUGUST 25, 1994 687

We are told, however, that the power of judicial review

is not so much power as it is duty imposed on this
Court by the Constitution and that we would be remiss
in the performance of that duty if we decline to look
behind the barriers set by the principle of separation of
powers. Art. VIII, § 1, ¶ 2 is cited in support of this
view:
Judicial power includes the duty of the courts of justice to

settle actual controversies involving rights which are legally
demandable and enforceable, and to determine whether or
not there has been a grave abuse of discretion amounting to
lack or excess of jurisdiction on the part of any branch or
instrumentality of the Government.
To view the judicial power of review as a duty is

nothing new. Chief Justice Marshall said so in 1803, to
justify the assertion of this power in Marbury v.
Madison:
It is emphatically the province and duty of the judicial
department to say what the law is. Those who apply the rule
to particular cases must of necessity expound and interpret
that rule. If two laws conflict with50each other, the courts
must decide on the operation of each.
Justice Laurel echoed this justification in 1936 in

Angara v. Electoral Commission:
And when the judiciary mediates to allocate constitutional

boundaries, it does not assert any superiority over the other
departments; it does not in reality nullify or invalidate an act
of the legislature, but only asserts the solemn and sacred
obligation assigned to it by the Constitution to determine
conflicting claims of authority under the Constitution and to
establish for the parties in an actual controversy the rights
51
which that instrument secures and guarantees to them.
This conception52of the judicial power has been affirmed

in several cases of this Court following Angara.
_______________
50 1 Cranch 137, 2 L.Ed. 60(1803) (emphasis added).

51 Supra note 49 (emphasis added).
52 People v. Vera, 65 Phil. 56, 94 (1937); Tañada v. Cuenco, 103
Phil. 1051, 1061-2 (1957); Macias v. COMELEC, 3 SCRA 1, 7-8
(1961).
688

It does not add anything, therefore, to invoke this

“duty” to justify this Court’s intervention in what is
essentially a case that at best is not ripe for
adjudication. That duty must still be performed in the
context of a concrete case or controversy, as Art. VIII, §
5(2) clearly defines our jurisdiction in terms of “cases,”
and nothing but “cases.” That the other departments of
the government may have committed a grave abuse of
discretion is not an independent ground for exercising
our power. Disregard of the essential limits imposed by
the case and controversy requirement can in the long
run only result in undermining our authority as a
court of law. For, as judges, what we are called upon to
render is judgment according to law, not according to
what may appear to be the opinion of the day.
____________________________________
In the preceding pages we have endeavored to discuss,

within limits, the validity of Republic Act No. 7716 in
its formal and substantive aspects as this has been
raised in the various cases before us. To sum up, we
hold:
(1) That the procedural requirements of the

Constitution have been complied with by
Congress in the enactment of the statute;
(2) That judicial inquiry whether the formal
requirements for the enactment of statutes—
beyond those prescribed by the Constitution—
have been observed is precluded by the
principle of separation of powers;
(3) That the law does not abridge freedom of
speech, expression or the press, nor interfere
with the free exercise of religion, nor deny to
any of the parties the right to an education;
and
(4) That, in view of the absence of a factual
foundation of record, claims that the law is
regressive, oppressive and confiscatory and
that it violates vested rights protected under
the Contract Clause are prematurely raised
and do not justify the grant of prospective relief
by writ of prohibition.
WHEREFORE, the petitions in these cases are
DISMISSED.
689
VOL. 235, AUGUST 25, 1994 689

Bidin, Quiason and Kapunan, JJ., concur.

Narvasa (C.J.) and Melo, J., Concur in separate
opinions.
Cruz, Padilla and Vitug, JJ., See separate
opinions.
Feliciano, J., I join in both the majority opinion
by Mendoza, J. and the concurring opinion of Narvasa,
C.J.
Regalado, Davide, Jr., Romero, Bellosillo and
Puno, JJ., See dissenting opinions.
SEPARATE OPINION
NARVASA, C.J.:
I fully concur with the conclusions set forth in the

scholarly opinion of my learned colleague, Mr. Justice
Vicente V. Mendoza. I write this separate opinion to
express my own views relative to the procedural issues
raised by the various petitions and dealt with by some
other Members of the Court in their separate opinions.
By their very nature, it would seem, discussions of
constitutional issues prove fertile ground for a not
uncommon phenomenon: debate marked by passionate
partisanship amounting sometimes to impatience with
adverse views, an eagerness on the part of the
proponents on each side to assume the role of, or be
perceived as, staunch defenders of constitutional
principles, manifesting itself in flights of rhetoric, even
hyperbole. The peril in this, obviously, is a diminution
of objectivity—that quality which, on the part of those
charged with the duty and authority of interpreting
the fundamental law, is of the essence of their great
function. For the Court, more perhaps than for any
other person or group, it is necessary to maintain that
desirable objectivity. It must make certain that on this
as on any other occasion, the judicial function is
meticulously performed, the facts ascertained as
comprehensively and as accurately as possible, all the
issues particularly identified, all the arguments clearly
understood; else, it may itself be accused, by its own
members or by others, of a lack of adherence to, or a
careless observance of, its own procedures, the
signatures of its individual members on its enrolled
verdicts notwithstanding.
690

In the matter now before the Court, and whatever

reservations some people may entertain about their
intellectual limitations or moral scruples, I cannot
bring myself to accept the thesis which necessarily
implies that the members of our august Congress, in
enacting the expanded VAT law, exposed their
ignorance, or indifference to the observance, of the
rules of procedure set down by the Constitution or by
their respective chambers, or what is worse,
deliberately ignored those rules for some yet
undiscovered purpose nefarious in nature, or at least
some purpose other than the public weal; or that a few
of their fellows, acting as a bicameral conference
committee, by devious schemes and cunning
maneuvers, and in conspiracy with officials of the
Executive Department and others, succeeded in
“pulling the wool over the eyes” of all their other
colleagues and foisting on them a bill containing
provisions that neither chamber of our bicameral
legislature conceived or contemplated. This is the
thesis that the petitioners would have this Court
approve. It is a thesis I consider bereft of any factual or
logical foundation.
Other than the bare declarations of some of the
petitioners, or arguments from the use and import of
the language employed in the relevant documents and
records, there is no evidence before the Court adequate
to support a finding that the legislators concerned,
whether of the upper or lower chamber, acted
otherwise than in good faith, in the honest discharge of
their functions, in the sincere belief that the
established procedures were being regularly observed
or, at least, that there occurred no serious or fatal
deviation therefrom. There is no evidence on which
reasonably to rest a conclusion that any executive or
other official took part in or unduly influenced the
proceedings before the bicameral conference
committee, or that the members of the latter were
motivated by a desire to surreptitiously introduce
improper revisions in the bills which they were
required to reconcile, or that after agreement had been
reached on the mode and manner of reconciliation of
the “disagreeing provisions,” had resorted to
stratagems or employed under-handed ploys to ensure
their approval and adoption by either House. Neither
is there any proof that in voting on the Bicameral
Conference Committee (BCC) version of the reconciled
bills, the members of the Senate and the House did so
in ignorance of, or without understanding, the contents
thereof or the bills therein reconciled.
691
VOL. 235, AUGUST 25, 1994 691

Also unacceptable is the theory that since the

Constitution requires appropriation and revenue bills
to originate exclusively in the House of
Representatives, it is improper if not unconstitutional
for the Senate to formulate, or even think about
formulating, its own draft of this type of measure in
anticipation of receipt of one transmitted by the lower
Chamber. This is specially cogent as regards much-
publicized suggestions for legislation (like the
expanded VAT Law) emanating from one or more
legislators, or from the Executive Department, or the
private sector, etc. which understandably could be
expected to forthwith generate much Congressional
cogitation.
Exclusive origination, I submit, should have no
reference to time of conception. As a practical matter,
origination should refer to the affirmative act which
effectively puts the bicameral legislative procedure in
motion, i.e., the transmission by one chamber to the
other of a bill for its adoption. This is the purposeful
act which sets the legislative machinery in operation to
effectively lead to the enactment of a statute. Until this
transmission takes place, the formulation and
discussions, or the reading for three or more times of
proposed measures in either chamber, would be
meaningless in the context of the activity leading
towards concrete legislation. Unless transmitted to the
other chamber, a bill prepared by either house cannot
possibly become law. In other words, the first
affirmative, efficacious step, the operative act as it
were, leading to actual enactment of a statute, is the
transmission of a bill from one house to the other for
action by the latter. This is the origination that is
spoken of in the Constitution in its Article VI, Section
24, in reference to appropriation, revenue, or tariff
bills, etc.
It may be that in the Senate, revenue or tax
measures are discussed, even drafted, and this before a
similar activity takes place in the House. This is of no
moment, so long as those measures or bills remain in
the Senate and are not sent over to the House. There is
no origination of revenue or tax measures by the
Senate in this case. However, once the House
completes the drawing up of a similar tax measure in
accordance with the prescribed procedure, even if this
is done subsequent to the Senate’s own measure—
indeed, even if this be inspired by information that a
measure of the same nature or on the same subject has
been formulated in the Senate—and after third
692

reading transmits its bill to the Senate, there is

origination by (or in) the House within the
contemplation of the Constitution.
So it is entirely possible, as intimated, that in
expectation of the receipt of a revenue or tax bill from
the House of Representatives, the Senate commences
deliberations on its own concept of such a legislative
measure. This, possibly to save time, so that when the
House bill reaches it, its thoughts and views on the
matter are already formed and even reduced to writing
in the form of a draft statute. This should not be
thought illegal, as interdicted by the Constitution.
What the Constitution prohibits is for the Senate to
begin the legislative process first, by sending its own
revenue bill to the House of Representatives for its
consideration and action. This is the initiation that is
prohibited to the Senate.
But petitioners claim that this last was what in fact
happened, that the bill that went through the
legislative mill and was finally approved as R.A. No.
7716, was the Senate version, SB 1630. This is
disputed by the respondents. They claim it was House
Bill 11197 that, after being transmitted to the Senate,
was referred after first reading to its Committee on
Ways and Means; was reported out by said Committee;
underwent second and third readings, was sent to the
bicameral conference committee and then, after
appropriate proceedings therein culminating in
extensive amendments thereof, was finally approved
by both Houses and became the Expanded VAT Law.
On whose side does the truth lie? If it is not possible
to make that determination from the pleadings and
records before this Court, shall it require evidence to
be presented? No, on both law and principle. The Court
will reject a case where the legal issues raised,
whatever they may be, depend for their resolution on
still unsettled questions of fact. Petitioners may not, by
raising what are concededly novel and weighty
constitutional questions, compel the Court to assume
the role of a trier of facts. It is on the contrary their
obligation, before raising those questions to this Court,
to see to it that all issues of fact are settled in
accordance with the procedures laid down by law for
proof of facts. Failing this, petitioners would have only
themselves to blame for a peremptory dismissal.
Now, what is really proven about what happened to
HB 11197 after it was transmitted to the Senate? It
seems to be admitted on
693
VOL. 235, AUGUST 25, 1994 693

all sides that after going through first reading, HB

11197 was referred to the Committee on Ways and
Means chaired by Senator Ernesto Herrera.
It is however surmised that after this initial step,
HB 11197 was never afterwards deliberated on in the
Senate, that it was there given nothing more than a
“passing glance,” and that it never went through a
proper second and third reading. There is no
competent proof to substantiate this claim. What is
certain is that on February 7, 1994, the Senate
Committee on Ways and Means submitted its Report
(No. 349) stating that HB 11197 was considered, and
recommending that SB 1630 be approved “in
substitution of S.B.1 No. 1129, taking into consideration
1
P.S. Res. No. 734 and H.B. No. 11197.” This Report
made known to the Senate, and clearly indicates, that
H.B. No. 11197 was indeed deliberated on by the
Committee; in truth, as Senator Herrera pointed out,
the BCC later “agreed to adopt (a broader coverage of
the VAT) which is closely adhering to the Senate
version ** ** with some new provisions or
amendments.” The plain implication is that the Senate
Committee had indeed discussed HB 11197 in
comparison with the inconsistent parts of SB 1129 and
afterwards proposed amendments to the former in the
form of a new bill (No. 1630) more closely akin to the
Senate bill (No. 1129).
And it is as reasonable to suppose as not that later,
during the second and third readings on March 24,
1994, the Senators, assembled as a body, had before
them copies of HB 11197 and SB 1129, as well as of the
Committee’s new “SB 1630” that had been
recommended for their approval, or at the very least
were otherwise perfectly aware that they were
considering the particular provisions of these bills.
That there was such a deliberation in the Senate on
HB 11197 in light of inconsistent portions of SB 1630,
may further be necessarily inferred from the request,
made by the Senate on the same day, March 24, 1994,
for the convocation of a bicameral conference
committee to reconcile “the disagreeing provisions of
said bill (SB 1630) and House Bill No. 11197,” a
________________
1 Resolution “Urging the Senate Committee on Ways and Means

to Study the Proposal to Exempt Local Movie Producers from the
Payment of the Value-Added Tax as an Incentive to the Production
of Quality and Wholesome Filipino Movies Whenever they Feature
an All-Filipino Cast of Actors and Actresses.”
694

request that could not have been made had not the
Senators more or less closely examined the provisions
of HB 11197 and compared them with those of the
counterpart Senate measures.
Were the proceedings before the bicameral
conference committee fatally flawed? The affirmative is
suggested because the committee allegedly overlooked
or ignored the fact that SB 1630 could not validly
originate in the Senate, and that HB 11197 and SB
1630 never properly passed both chambers. The
untenability of these contentions has already been
demonstrated. Now, demonstration of the
indefensibility of other arguments purporting to
establish the impropriety of the BCC proceedings will
be attempted.
There is the argument, for instance, that the
conference committee never used HB 11197 even as
“frame of reference” because it does not appear that
the suggestion therefor (made by House Panel
Chairman Exequiel Javier at the bicameral conference
committee’s meeting on April 19, 1994, with the
concurrence of Senator Maceda) was ever resolved, the
minutes being regrettably vague as to what occurred
after that suggestion was made. It is, however, as
reasonable to assume that it was, as it was not, given
the vagueness of the minutes already alluded to. In
fact, a reading of the BCC Report persuasively
demonstrates that HB 11197 was not only utilized as a
“frame of reference” but actually discussed and
deliberated on. 2
Said BCC Report pertinently states:
“CONFERENCE COMMITTEE REPORT
The Conference Committee on the disagreeing provisions of

House Bill No. 11197, entitled:
AN ACT RESTRUCTURING THE VALUE ADDED TAX
TITLE V, AND 236, 237, AND 238 OF TITLE IX, AND
REPEALING SECTIONS 113SD AND 114 OF TITLE V,
ALL OF THE NATIONAL INTERNAL REVENUE CODE,
AS AMENDED
________________
2 Italics supplied.
695
VOL. 235, AUGUST 25, 1994 695

and Senate Bill No. 1630 entitled:

106, 107, 108 AND 110 OF TITLE IV, 112, 115, 117 AND 121
OF TITLE V, AND 236, 237, AND 238 OF TITLE IX, AND
REPEALING SECTIONS 113, 114, 116, 119 AND 120 OF
TITLE V, ALL OF THE NATIONAL INTERNAL REVENUE
CODE, AS AMENDED AND FOR OTHER PURPOSES
having met, after full and free conference, has agreed to
recommend and do hereby recommend to their respective
Houses that House Bill No. 11197, in consolidation with
Senate Bill No. 1630, be approved in accordance with the
attached copy of the bill as reconciled and approved by the
conferees.
Approved.”
The Report, it will be noted, explicitly adverts to House

Bill No. 11197, it being in fact mentioned ahead of
Senate Bill No. 1630; graphically shows the very close
identity of the subjects of both bills (indicated in their
respective titles); and clearly says that the committee
met in “full and free conference” on the “disagreeing
provisions” of both bills (obviously in an effort to
reconcile them); and that reconciliation of said
“disagreeing provisions” had been effected, the BCC
having agreed that “House Bill No. 11197, in
consolidation with Senate Bill No. 1630, be approved in
accordance with the attached copy of the bill as
reconciled and approved by the conferees.”
It may be concluded, in other words, that,
conformably to the procedure provided in the
Constitution with which all the Members of the
bicameral conference committee cannot but be
presumed to be familiar, and no proof to the contrary
having been adduced on the point, it was the original
bill (HB 11197) which said body had considered and
deliberated on in detail, reconciled or harmonized with
SB 1630, and used as basis for drawing up the
amended version eventually reported out and
submitted to both houses of Congress.
It is further contended that the BCC was created
and convoked prematurely, that SB 1630 should first
have been sent to the House of Representatives for
concurrence. It is maintained, in
696

other words, that the latter chamber should have

refused the Senate request for a bicameral conference
committee to reconcile the “disagreeing provisions” of
both bills, and should have required that SB 1630 be
first transmitted to it. This, seemingly, is nit-picking
given the urgency of the proposed legislation as
certified by the President (to both houses, in fact).
Time was of the essence, according to the President’s
best judgment—as regards which absolutely no one in
either chamber of Congress took exception, general
acceptance being on the contrary otherwise manifested
—and that judgment the Court will not now question.
In light of that urgency, what was so vital or
indispensable about such a transmittal that its
absence would invalidate all else that had been done
towards enactment of the law, completely escapes me,
specially considering that the House had immediately
acceded without demur to the request for convocation
of the conference committee.
What has just been said should dispose of the
argument that the statement in the enrolled bill, that
“This Act which is a consolidation of House Bill No.
11197 and Senate Bill No. 1630 was finally passed by
the House of Representatives and the Senate on April
27, 1994 and May 2, 1994,” necessarily signifies that
there were two (2) bills separately introduced,
retaining their independent existence until they
reached the bicameral conference committee where
they were consolidated, and therefore, the VAT law did
not originate exclusively in the House having
originated in part in the Senate as SB 1630, which bill
was not embodied in but merely merged with HB
11197, retaining its separate identity until it was
joined by the BCC with the house measure. The more
logical, and fairer, course is to construe the expression,
“consolidation of House Bill No. 11197 and Senate Bill
No. 1630” in the context of accompanying and
contemporaneous statements, i.e.: (a) the declaration
in the BCC Report, supra, that the committee met to
reconcile the disagreeing provisions of the two bills,
“and after full and free conference” on the matter,
agreed and so recommended that “House Bill No.
11197, in consolidation with Senate Bill No. 1630, be
approved in accordance with the attached copy of the
bill as reconciled and approved by the conferees;” and
(b) the averment of Senator Herrera, in the Report of
the Ways and Means Committee, supra, that the
committee had actually “considered” (discussed)
697
VOL. 235, AUGUST 25, 1994 697

HB No. 11197 and taken it “into consideration” in

recommending that its own version of the measure (SB
1630) be the one approved.
That the Senate might have drawn up its own
version of the expanded VAT bill, contemporaneously
with or even before the House did, is of no moment. It
bears repeating in this connection that no VAT bill
ever originated in the Senate; neither its SB 1129 or
SB 1630 or any of its drafts was ever officially
transmitted to the House as an initiating bill which, as
already pointed out, is what the Constitution forbids; it
was HB 11197 that was first sent to the Senate,
underwent first reading, was referred to Committee on
Ways and Means and there discussed in relation to
and in comparison with the counterpart Senate version
or versions—the mere formulation of which was, as
also already discussed, not prohibited to it—and
afterwards considered by the Senate itself, also in
connection with SB 1630, on second and third
readings. HB 11197 was in the truest sense, the
originating bill.
An issue has also arisen respecting the so-called
“enrolled bill doctrine” which, it is said, whatever
sacrosanct status it might originally have enjoyed, is
now in bad odor with modern scholars on account of its
imputed rigidity and unrealism; it being also
submitted that the ruling in “Mabanag v. Lopez Vito
(78 Phil. 1) and the cases reaffirming it, is no longer
good law, it being3
based on a provision of the Code of
Civil Procedure long since stricken from the statute
books.
I would myself consider the “enrolled bill” theory as
laying down a presumption of so strong a character as
to be well nigh absolute or conclusive, fully in accord
with the familiar and fundamental philosophy of
separation of powers. The result, as far as I am
concerned, is to make discussion of the enrolled bill
principle purely academic; for as already pointed out,
there is no proof worthy of the name of any facts to
justify its reexamination and, possibly, disregard.
The other question is, what is the nature of the
power given to a bicameral conference committee of
reconciling differences
_________________
3 Giving “conclusive” character to copies of Acts of the Philippine

Commission which have been signed by its presiding officers and
secretaries.
698

between, or “disagreeing provisions” in, a bill

originating from the House in relation to amendments
proposed by the Senate—whether as regards some or
all of its provisions? Is the mode of reconciliation,
subject to fixed procedure and guidelines? What
exactly can the committee do, or not do? Can it only
clarify or revise provisions found in either Senate or
House bill? Is it forbidden to propose additional or new
provisions, even on matters necessarily or reasonably
connected with or germane to items in the bills being
reconciled?
In answer, it is postulated that the reconciliation
function is quite limited. In these cases, the conference
committee should have confined itself to reconciliation
of differences or inconsistencies only by (a) restoring
provisions of HB 11197 eliminated by SB 1630, or (b)
sustaining wholly or partly the Senate amendments, or
(c) as a compromise, agreeing that neither provisions
nor amendments be carried into the final form of HB
11197 for submission to both chambers of the
legislature.
The trouble is, it is theorized, the committee
incorporated activities or transactions which were not
within the contemplation of both bills; it made
additions and deletions which did not enjoy the
enlightenment of initial committee studies; it exercised
what is known as an “ex post veto power” granted to it
by no law, rule or regulation, a power that in truth is
denied to it by the rules of both the Senate and the
House. In substantiation, the Senate rule is cited,
similar to that of the House, providing that
“differences shall be settled by a conference committee”
whose report shall contain “detailed and sufficiently
explicit statement of the changes in or amendments to
the subject measure, ** (to be) signed by the
conferees;” as well as the “Jefferson’s Manual,” adopted
by the Senate as supplement to its own rules, directing
that the managers of the conference must confine
themselves to differences submitted to them; they may
not include subjects not within the disagreements even
though germane to a question in issue.”
It is significant that the limiting proviso in the
relevant rules has been construed and applied as
directory, not mandatory. During the oral argument,
counsel for petitioners admitted that the practice for
decades has been for bicameral conference committees
to include such provisions in the reconciled bill as they
believed to be germane or necessary and acceptable to
both
699
VOL. 235, AUGUST 25, 1994 699

chambers, even if not within any of the “disagreeing

provisions,” and the reconciled bills, containing such
provisions had invariably been approved and adopted
by both houses of Congress. It is a practice, they say,
that should be stopped. But it is a practice that
establishes in no uncertain manner the prevailing
concept in both houses of Congress of the permissible
and acceptable modes of reconciliation that their
conference committees may adopt, one whose
undesirability is not all that patent if not, indeed,
incapable of unquestionable demonstration. The fact is
that conference committees only take up bills which
have already been freely and fully discussed in both
chambers of the legislature, but as to which there is
need of reconciliation in view of “disagreeing
provisions” between them; and both chambers entrust
the function of reconciling the bills to their delegates at
a conference committee with full awareness, and tacit
consent, that conformably with established practice
unquestioningly observed over many years, new
provisions may be included even if not within the
“disagreeing provisions” but of which, together with
other changes, they will be given detailed and
sufficiently explicit information prior to voting on the
conference committee version.
In any event, a fairly recent decision written for the
Court by Senior Associate Justice Isagani A. Cruz,
promulgated on November 11, 1993 (G.R. No. 105371,
The Philippine Judges Association, etc., et al. v. Hon.
Pete Prado, etc., et al.), should leave no doubt of the
continuing vitality of the enrolled bill doctrine and give
an insight into the nature of the reconciling function of
bicameral conference committees. In that case, a
bilateral conference committee was constituted and
met to reconcile Senate Bill No. 720 and House Bill No.
4200. It adopted a “reconciled” measure that was
submitted to and approved by both chambers of
Congress and ultimately signed into law by the
President, as R.A. No. 7354. A provision in this statute
(removing the franking privilege from the courts,
among others) was assailed as being an invalid
amendment because it was not included in the original
version of either the senate or the house bill and hence
had generated no disagreement between them which
had to be reconciled. The Court held:
700
“While it is true that a conference committee is the

mechanism for compromising differences between the Senate
and the House, it is not limited in its jurisdiction to this
question. Its broader function is described thus:
A conference committee may deal generally with the subject matter

or it may be limited to resolving the precise differences between the
two houses. Even where the conference committee is not by rule
limited in its jurisdiction, legislative custom severely limits the
freedom with which new subject matter can be inserted into the
conference bill. But occasionally a conference committee produces
unexpected results, results beyond its mandate. These excursions
occur even where the rules impose strict limitations on conference
committee jurisdiction. This is symptomatic of the authoritarian
power of conference committee (Davies, Legislative Law and
Process: In A Nutshell, 1987 Ed., p. 81).
It is a matter of record that the Conference Committee

Report on the bill in question was returned to and duly
approved by both the Senate and the House of
Representatives. Thereafter, the bill was enrolled with
its certification by Senate President Neptali A.
Gonzales and Speaker Ramon V. Mitra of the House of
Representatives as having been duly passed by both
Houses of Congress. It was then presented to and
approved by President Corazon C. Aquino on April 3,
1992.
Under the doctrine of separation of powers, the
Court may not inquire beyond the certification of the
approval of a bill from the presiding officers of
Congress. Casco Philippine Chemical Co. v. Gimenez (7
SCRA 347) laid down the rule that the enrolled bill is
conclusive upon the Judiciary (except in matters that
have to be entered in the journals like the yeas and
nays on the final reading of the bill) (Mabanag v. Lopez
Vito, 78 Phil. 1). The journals are themselves also
binding on the Supreme Court, as we held in the old
(but still valid) case of U.S. v. Pons (34 Phil. 729),
where we explained the reason thus:
To inquire into the veracity of the journals of the Philippine

legislature when they are, as we have said, clear and explicit,
would be to violate both the letter and spirit of the organic
laws by which the Philippine Government was brought into
existence, to invade a coordinate and independent
department of the Government, and to interfere with the
legitimate powers and functions of the Legislature. Applying
these principles, we shall decline to look into the petitioners’
701
VOL. 235, AUGUST 25, 1994 701

charges that an amendment was made upon the last reading

of the bill that eventually R.A. No. 7354 and that copies
thereof in its final form were not distributed among the
members of each House. Both the enrolled bill and the
legislative journals certify that the measure was duly
enacted i.e., in accordance with Article VI, Sec. 26 (2) of the
Constitution. We are bound by such official assurances from
a coordinate department of the government, to which we owe,
at the very least, a becoming courtesy.”
Withal, an analysis of the changes made by the

conference committee in HB 11197 and SB 1630 by
way of reconciling their “disagreeing provisions,”—
assailed by petitioners as unauthorized or incongruous
—reveals that many of the changes related to actual
“disagreeing provisions,” and that those that might
perhaps be considered as entirely new are nevertheless
necessarily or logically connected with or germane to
particular matters in the bills being reconciled.
For instance, the change made by the bicameral
conference committee (BCC) concerning amendments
to Section 99 of the National Internal Revenue Code
(NIRC)—the addition of “lessors of goods or properties
and importers of goods”—is really a reconciliation of
disagreeing provisions, for while HB 11197 mentions
as among those subject to tax, “one who sells, barters,
or exchanges goods or properties and any person who
leases personal properties,” SB 1630 does not. The
change also merely clarifies the provision by providing
that the contemplated taxpayers includes “importers.”
The revision as regards the amendment to Section 100,
NIRC, is also simple reconciliation, being nothing more
than the adoption by the BCC of the provision in HB
11197 governing the sale of gold to Bangko Sentral, in
contrast to SB 1630 containing no such provision.
Similarly, only simple reconciliation was involved as
regards approval by the BCC of a provision declaring
as not exempt, the sale of real properties primarily
held for sale to customers or held for lease in the
ordinary course of trade or business, which provision is
found in HB 11197 but not in SB 1630; as regards the
adoption by the BCC of a provision on life insurance
business, contained in SB 1630 but not found in HB
11197; as regards adoption by the BCC of the provision
in SB 1630 for deferment of tax on certain goods and
services for no longer than 3 years, as to which there
was no counterpart provision in SB 11197; and as
regards the fixing of a
702

period for the adoption of implementing rules, a period

being prescribed in SB 1630 and none in HB 11197.
In respect of other revisions, it would seem that
questions logically arose in the course of the discussion
of specific “disagreeing provisions” to which answers
were given which, because believed acceptable to both
houses of Congress, were placed in the BCC draft. For
example, during consideration of radio and television
time (Sec. 100, NIRC) dealt with in both House and
Senate bills, the question apparently came up, the
relevance of which is apparent on its face, relative to
satellite transmission and cable television time. Hence,
a provision in the BCC bill on the matter. Again, while
deliberating on the definition of goods or properties in
relation to the provision subjecting sales thereof to tax,
a question apparently arose, logically relevant, about
real properties intended to be sold by a person in
economic difficulties, or because he wishes to buy a car,
i.e., not as part of a business, the BCC evidently
resolved to clarify the matter by excluding from the
tax, “real properties held primarily for sale to
customers or held for lease in the ordinary course of
business.” And in the course of consideration of the
term, sale or exchange of services (Sec. 102, NIRC), the
inquiry most probably was posed as to whether the
term should be understood as including other services:
e.g., services of lessors of property whether real or
personal, of warehousemen, of keepers of resthouses,
pension houses, inns, resorts, or of common carriers,
etc., and presumably the BCC resolved to clarify the
matter by including the services just mentioned.
Surely, changes of this nature are obviously to be
expected in proceedings before bicameral conference
committees and may even be considered grist for their
mill, given the history of such BCCs and their general
practice here and abroad.
In any case, all the changes and revisions, and
deletions, made by the conference committee were all
subsequently considered by and approved by both the
Senate and the House, meeting and voting separately.
It is an unacceptable theorization, to repeat, that when
the BCC report and its proposed bill were submitted to
the Senate and the House, the members thereof did not
bother to read, or what is worse, having read did not
understand, what was before them, or did not realize
that there were new provisions in the reconciled
version unrelated to any “disagreeing provisions,” or
that said new provisions or revisions were effectively
concealed
703
VOL. 235, AUGUST 25, 1994 703

from them.
Moreover, it certainly was entirely within the power
and prerogative of either legislative chamber to reject
the BCC bill and require the organization of a new
bicameral conference committee. That this option was
not exercised by either house only proves that the BCC
measure was found to be acceptable as in fact it was
approved and adopted by both chambers.
I vote to DISMISS the petitions for lack of merit.
SEPARATE OPINION
CRUZ, J.:
It is a curious and almost incredible fact that at the

hearing of these cases on July 7, 1994, the lawyers who
argued for the petitioners—two of them former
presidents of the Senate and the third also a member
of that body—all asked this Court to look into the
internal operations of their Chamber and correct the
irregularities they claimed had been committed there
as well as in the House of Representatives and in the
bicameral conference committee.
While a member of the legislature would normally
resist such intervention and invoke the doctrine of
separation of powers to protect Congress from what he
would call judicial intrusion, these counsel practically
implored the Court to examine the questioned
proceedings and to this end go beyond the journals of
each House, scrutinize the minutes of the committee,
and investigate all other matters relating to the
passage of the bill (or bills) that eventually became
R.A. No. 7716.
In effect, the petitioners would have us disregard
the time-honored inhibitions laid down by the Court
upon itself in the landmark case of U.S. v. Pons (34
Phil. 725), where it refused to consider extraneous
evidence to disprove the recitals in the journals of the
Philippine Legislature that it had adjourned sine die at
midnight of February 28, 1914. Although it was
generally known then that the special session had
actually exceeded the deadline fixed by the Governor-
General in his proclamation, the Court chose to be
guided solely by the legislative journals, holding
significantly as follows:
704

* * * From their very nature and object, the records of the

legislature are as important as those of the judiciary, and to
inquire into the veracity of the journals of the Philippine
Legis-lature, when they are, as we have said, clear and
explicit, would be to violate both the letter and the spirit of
the organic laws by which the Philippine Government was
brought into existence, to invade a coordinate and
independent department of the Govern-ment, and to
interfere with the legitimate powers and functions of the
Legislature. But counsel in his argument says that the public
knows that the Assembly’s clock was stopped on February
28, 1914, at midnight and left so until the determination of
the discussion of all pending matters. Or, in other words, the
hands of the clock were stayed in order to enable the
Assembly to effect an adjournment apparently within the
fixed time by the Governor’s proclamation for the expiration
of the special session, in direct violation of the Act of
Congress of July 1, 1902. If the clock was, in fact, stopped, as
here suggested, “the resultant evil might be slight as
compared with that of altering the probative force and
character of legislative records, and making the proof of
legislative action depend upon uncertain oral evidence, liable
to loss by death or absence, and so imperfect on account of
the treachery of memory.”
* * * The journals say that the Legislature adjourned at 12
midnight on February 28, 1914. This settles the question,
and the court did not err in declining to go beyond the
journals.
As one who has always respected the rationale of the

separation of powers, I realize only too well the serious
implications of the relaxation of the doctrine except
only for the weightiest of reasons. The lowering of the
barriers now dividing the three major branches of the
government could lead to invidious incursions by one
department into the exclusive domains of the other
departments to the detriment of the proper discharge
of the functions assigned to each of them by the
Constitution.
Still, while acknowledging the value of tradition and
the reasons for judicial non-interference announced in
Pons, I am not disinclined to take a second look at the
ruling from a more pragmatic viewpoint and to tear
down, if we must, the iron curtain it has hung, perhaps
improvidently, around the proceedings of the
legislature.
I am persuaded even now that where a specific
procedure is fixed by the Constitution itself, it should
not suffice for Congress to simply say that the rules
have been observed and flatly consider the matter
closed. It does not have to be as final as that.
705
VOL. 235, AUGUST 25, 1994 705

I would imagine that the judiciary, and particularly

this Court, should be able to verify that statement and
determine for itself, through the exercise of its own
powers, if the Constitution has, indeed, been obeyed.
In fact, the Court has already said that the question
of whether certain procedural rules have been followed
is justiciable rather than political because what is
involved is the legality and not the wisdom of the act in
question. So we ruled in Sanidad v. Commission on
Elections (73 SCRA 333) on the amendment of the
Constitution; in Daza v. Singson (180 SCRA 496) on
the composition of the Commission on Appointments;
and in the earlier case of Tañada v. Cuenco (103 Phil.
1051) on the organization of the Senate Electoral
Tribunal, among several other cases.
By the same token, the ascertainment of whether a
bill underwent the obligatory three readings in both
Houses of Congress should not be considered an
invasion of the territory of the legislature as this would
not involve an inquiry into its discretion in approving
the measure but only the manner in which the
measure was enacted.
These views may upset the conservatives among us
who are most comfortable when they allow themselves
to be petrified by precedents instead of venturing into
uncharted waters. To be sure, there is much to be said
of the wisdom of the past expressed by vanished judges
talking to the future. Via trita est tuttisima. Except
when there is a need to revise them because of an
altered situation or an emergent idea, precedents
should tell us that, indeed, the trodden path is the
safest path.
It could be that the altered situation has arrived to
welcome the emergent idea. The jurisdiction of this
Court has been expanded by the Constitution, to
possibly include the review the petitioners would have
us make of the congressional proceedings being
questioned. Perhaps it is also time to declare that the
activities of Congress can no longer be smoke-screened
in the inviolate recitals of its journals to prevent
examination of its sacrosanct records in the name of
the separation of powers.
But then again, perhaps all this is not yet necessary
at this time and all these observations are but wishful
musings for a more activist judiciary. For I find that
this is not even necessary, at least for me, to leave the
trodden path in the search for new
706

adventures in the byways of the law. The answer we

seek, as I see it, is not far afield. It seems to me that it
can be found through a study of the enrolled bill alone
and that we do not have to go beyond that measure to
ascertain if R.A. No. 7716 has been validly enacted.
It is settled in this jurisdiction that in case of
conflict between the enrolled bill and the legislative
journals, it is the former that should prevail except
only as to matters that the Constitution requires to be
entered in the journals. (Mabanag v. Lopez Vito, 78
Phil. 1). These are the yeas and nays on the final
reading of a bill or on any question at the request of at
least one-fifth of the members of the House
(Constitution, Art. VI, Sec. 16 [4]), the objections of the
President to a vetoed bill or item (Ibid, Sec. 27 [1]), and
the names of the members voting for or against the
overriding of his veto (Id. Section 27 [1]). The origin of
a bill is not specifically required by the Constitution to
be entered in the journals. Hence, on this particular
matter, it is the recitals in the enrolled bill and not in
the journals that must control.
Article VI, Section 24, of the Constitution provides:
Sec. 24. All appropriation, revenue or tariff bills, bills

concur with amendments.
The enrolled bill submitted to and later approved by

the President of the Philippines as R.A. No. 7716 was
signed by the President of the Senate and the Speaker
of the House of Representatives. It carried the
following certification over the signatures of the
Secretary of the Senate and the Acting Secretary of the
House of Representatives:
This Act which is a consolidation of House Bill No. 11197 and

Senate Bill No. 1630 was finally passed by the House of
Representatives and the Senate on April 27, 1994, and May
2, 1994.
Let us turn to Webster for the meaning of certain

words:
To “originate” is “to bring into being; to create
something (original); to invent; begin; start.” The word
“exclusively” means “excluding all others” and is
derived from the word “exclusive,” meaning “not
shared or divided; sole; single.” Applying these
707
VOL. 235, AUGUST 25, 1994 707

meanings, I would read Section 24 as saying that the

bills mentioned therein must be brought into being, or
created, or invented, or begun or started, only or singly
or by no other body than the House of Representatives.
According to the certification, R.A. No . 7716 “is a
consolidation of House Bill No. 11197 and Senate Bill
No. 1630.” Again giving the words used their natural
and ordinary sense conformably to an accepted canon
of construction, I would read the word “consolidation”
as a “combination or merger” and derived from the
word “consolidate,” meaning “to combine into one;
merge; unite.”
The two bills were separately introduced in their
respective Chambers. Both retained their independent
existence until they reached the bicameral conference
committee where they were consolidated. It was this
consolidated measure that was finally passed by
Congress and submitted to the President of the
Philippines for his approval.
House Bill No. 11197 originated in the House of
Representatives but this was not the bill that
eventually became R.A. No. 7716. The measure that
was signed into law by President Ramos was the
consolidation of that bill and another bill, viz., Senate
Bill No. 1630, which was introduced in the Senate. The
resultant enrolled bill thus did not originate exclusively
in the House of Representatives. The enrolled bill itself
says that part of it (and it does not matter to what
extent) originated in the Senate.
It would have been different if the only participation
of the Senate was in the amendment of the measure
that was originally proposed in the House of
Representatives. But this was not the case. The
participation of the Senate was not in proposing or
concurring with amendments that would have been
incorporated in House Bill No. 11197. Its participation
was in originating its own Senate Bill No. 1630, which
was not embodied in but merged with House Bill No.
11197.
Senate Bill No. 1630 was not even an amendment
by substitution, assuming this was permissible. To
“substitute” means “to take the place of; to put or use
in place of another.” Senate Bill No. 1630 did not, upon
its approval, replace (and thus eliminate) House Bill
No. 11197. Both bills retained their separate identities
until they were joined or united into what became the
enrolled bill and ultimately R.A. No. 7716.
708

The certification in the enrolled bill says it all. It is

clear that R.A. No. 7716 did not originate exclusively
in the House of Representatives.
To go back to my earlier observations, this
conclusion does not require the reversal of U.S. vs.
Pons and an inquiry by this Court into the proceedings
of the legislature beyond the recitals of its journals. All
we need to do is consider the certification in the
enrolled bill and, without entering the precincts of
Congress, declare that by its own admission it has,
indeed, not complied with the Constitution.
While this Court respects the prerogatives of the
other departments, it will not hesitate to rise to its
higher duty to require from them, if they go astray, full
and strict compliance with the fundamental law. Our
fidelity to it must be total. There is no loftier principle
in our democracy than the supremacy of the
Constitution, to which all must submit.
I vote to invalidate R.A. No. 7716 for violation of
Article VI, Sec. 24, of the Constitution.
SEPARATE OPINION
PADILLA, J.:
The original VAT law and the expanded VAT law

1
In Kapatiran v. Tan, where the ponente was the writer
of this Separate Opinion, a unanimous Supreme Court
en banc upheld the validity of the original VAT law
(Executive Order No. 273, approved on 25 July 1987).
It will, in my view, be pointless at this time to re-open
arguments advanced in said case as to why said VAT
law was invalid, and it will be equally redundant to re-
state the principles laid down by the Court in the same
case affirming the validity of the VAT law as a tax
measure. And yet, the same arguments are, in effect,
marshalled against the merits and substance of the
expanded VAT law (Rep. Act No. 7716, approved on 5
May 1994). The same Supreme Court decision should
_________________
1 G.R. No. 81311, 30 June 1988, 163 SCRA 371.
709
VOL. 235, AUGUST 25, 1994 709

therefore dispose, in the main, of such arguments, for

the expanded VAT law is predicated basically on the
same principles as the original VAT law, except that
now the tax base of the VAT imposition has been
expanded or broadened.
It only needs to be stated—what actually should be
obvious—that a tax measure, like the expanded VAT
law (Republic Act No. 7716), is enacted by Congress
and approved by the President in the exercise of the
State’s power to tax, which is an attribute of
sovereignty. And while the power to tax, if exercised
without limit, is a power to destroy, and should,
therefore, not be allowed in such form, it has to be
equally recognized that the power to tax is an essential
right of government. Without taxes, basic services to
the people can come to a halt; economic progress will
be stunted, and, in the long run, the people will suffer
the pains of stagnation and retrogression.
Consequently, upon careful deliberation, I have no
difficulty in reaching the conclusion that the expanded
VAT law comes within the legitimate power of the state
to tax. And as I had occasion to previously state:
“Constitutional Law, to begin with, is concerned with power

not political convenience, wisdom, exigency, or even
necessity. Neither the Executive nor the Legislative
(Commission on Appointments)
2
can create power where the
Constitution confers none.”
Likewise, in the first VAT case, I said:

“In any event, if petitioners seriously believe that the
adoption and continued application of the VAT are
prejudicial to the general welfare or the interests of the
majority of the people, they should seek recourse and relief
from the political branches of the government. The Court,
following the time-honored doctrine of separation of powers,
cannot substitute its judgment for that of the President (and
Congress) as to the wisdom,
3
justice and advisability of the
adoption of the VAT.”
________________
2 Bautista v. Salonga, G.R. No. 86439, 13 April 1989, 172 SCRA

160.
3 Kapatiran, supra at 385.
710

This Court should not, as a rule, concern itself with

questions of policy, much less, economic policy. That is
better left to the two (2) political branches of
government. That the expanded VAT law is unwise,
unpopular and even anti-poor, among other things said
against it, are arguments and considerations within
the realm of policy-debate, which only Congress and
the Executive have the authority to decisively confront,
alleviate, remedy and resolve.
II
The procedure followed in the approval of Rep. Act No.
7716 Petitioners however posit that the present case
raises a far-reaching constitutional question which the
Court is duty-bound to decide under 4
its expanded
jurisdiction in the 1987 Constitution. Petitioners more
specifically question and impugn the manner by which
the expanded VAT law (Rep. Act No. 7716) was
approved by Congress. They contend that it was
approved in violation of the Constitution from which
fact it follows, as a consequence, that the law is null
and void. Main reliance of the petitioners in their
assault is Section 24, Art. VI of the Constitution which
provides:
“Sec. 24. All appropriation, revenue or tariff bills, bills

authorizing increase of the public debt, bill of local
concur with amendments.”
While it should be admitted at the outset that there

was no rigorous and strict adherence to the literal
command of the above provision, it may however be
said, after careful reflection, that there was substantial
compliance with the provision.
There is no question that House Bill No. 11197
expanding the VAT law originated from the House of
Representatives. It is undeniably a House measure. On
the other hand, Senate Bill No. 1129, also expanding
the VAT law, originated from the Senate. It
________________
4 Sec. 1, Art. VIII.
711
VOL. 235, AUGUST 25, 1994 711

is undeniably a Senate measure which, in point of

time, actually antedated House Bill No. 11197.
But it is of record that when House Bill No. 11197
was, after approval by the House, sent to the Senate, it
was referred to, and considered by the Senate
Committee on Ways and Means (after first reading)
together with Senate Bill No. 1129, and the Committee
came out with Senate Bill No. 1630 in substitution of
Senate Bill No. 1129 but after expressly taking into
consideration House Bill No. 11197.
Since the Senate is, under the above-quoted
constitutional provision, empowered to concur with a
revenue measure exclusively originating from the
House, or to propose amendments thereto, to the
extent of proposing amendments by SUBSTITUTION
to the House measure, the approval by the Senate of
Senate Bill No. 1630, after it had considered House Bill
No. 11197, may be taken, in my view, as an
AMENDMENT BY SUBSTITUTION by the Senate not
only of Senate Bill No. 1129 but of House Bill No.
11197 as well which, it must be remembered,
originated exclusively from the House.
But then, in recognition of the fact that House Bill
No. 11197 which originated exclusively from the House
and Senate Bill No. 1630 contained conflicting
provisions, both bills (House Bill No. 11197 and Senate
Bill No. 1630) were referred to the Bicameral
Conference Committee for joint consideration with a
view to reconciling their conflicting provisions.
The Conference Committee came out eventually
with a Conference Committee Bill which was
submitted to both chambers of Congress (the Senate
and the House). The Conference Committee reported
out a bill consolidating provisions in House Bill No.
11197 and Senate Bill No. 1630. What transpired in
both chambers after the Conference Committee Report
was submitted to them is not clear from the records in
this case. What is clear however is that both chambers
voted separately on the bill reported out by the
Conference Committee and both chambers approved
the bill of the Conference Committee.
To me then, what should really be important is that
both chambers of Congress approved the bill reported
out by the Conference Committee. In my considered
view, the act of both chambers of Congress in
approving the Conference Committee bill, should put
an end to any inquiry by this Court as to how the
712

bill came about. What is more, such separate approvals

CURED whatever constitutional infirmities may have
arisen in the procedures leading to such approvals.
For, if such infirmities were serious enough to impugn
the very validity of the measure itself, there would
have been an objection or objections from members of
both chambers to the approval. The Court has been
shown no such objection on record in both chambers.
Petitioners contend that there were violations of
Sec. 26 paragraph 2, Article VI of the Constitution
which provides:
“SEC. 26. x x x
(2) No bill passed by either House shall become a law
unless it has passed three readings on separate days, and
printed copies thereof in its final form have been distributed
to its Members three days before its passage, except when
the President certifies to the necessity of its immediate
enactment to meet a public calamity or emergency. Upon the
last reading of a bill, no amendment thereto shall be allowed,
and the vote thereon shall be taken immediately thereafter,
and the yeas and nays entered in the Journal.”
in that, when Senate Bill No. 1630 (the Senate

counterpart of House Bill No. 11197) was approved by
the Senate, after it had been reported out by the
Senate Committee on Ways and Means, the bill went
through second and third readings on the same day
(not separate days) and printed copies thereof in its
final form were not distributed to the members of the
Senate at least three (3) days before its passage by the
Senate. But we are told by the respondents that the
reason for this “short cut” was that the President had
certified to the necessity of the bill’s immediate
enactment to meet an emergency—a certification that,
by leave of the same constitutional provision,
dispensed with the second and third readings on
separate days and the printed form at least three (3)
days before its passage.
We have here then a situation where the President
did certify to the necessity of Senate Bill No. 1630’s
immediate enactment to meet an emergency and the
Senate responded accordingly. While I would be the
last to say that this Court cannot review the exercise of
such power by the President in appropriate cases ripe
for judicial review, I am not prepared however to say
that the President gravely abused his discretion in the
exercise of such power as to require that this Court
overturn his action. We have
713
VOL. 235, AUGUST 25, 1994 713

been shown no fact or circumstance which would

impugn the judgment of the President, concurred in by
the Senate, that there was an emergency that required
the immediate enactment of Senate Bill No. 1630. On
the other hand, a becoming respect for a co-equal and
coordinate department of government points that
weight and credibility be given to such Presidential
judgment.
The authority or power of the Conference
Committee to make insertions in and deletions from
the bills referred to it, namely, House Bill No. 11197
and Senate Bill No. 1630 is likewise assailed by
petitioners. Again, what appears important here is
that both chambers approved and ratified the bill as
reported out by the Conference Committee (with the
reported insertions and deletions). This is perhaps
attributable to the known legislative practice of
allowing a Conference Committee to make insertions
in and deletions from bills referred to it for
consideration, as long as they are germane to the
subject matter of the bills under consideration.
Besides, when the Conference Committee made the
insertions and deletions complained of by petitioners,
was it not actually performing the task assigned to it of
reconciling conflicting provisions in House Bill No.
11197 and Senate Bill No. 1630?
This Court impliedly if not expressly recognized the
fact of such legislative practice in Philippine
5
Judges
Association, etc. vs. Hon. Peter Prado, etc.. In said
case, we stated thus:
“The petitioners also invoke Sec. 74 of the Rules of the House

of Representatives, requiring that amendment to any bill
when the House and the Senate shall have differences
thereon may be settled by a conference committee of both
chambers. They stress that Sec. 35 was never a subject of
any disagreement between both Houses and so the second
paragraph could not have been validly added as an
amendment.
These arguments are unacceptable.
While it is true that a conference committee is the
mechanism for compromising differences between the Senate
and the House, it is not limited in its jurisdiction to this
question. Its broader function is described thus:
‘A conference committee may deal generally with the subject matter

or it may be limited to resolving the precise differences
_______________
5 G.R. No. 103371, 11 November 1993.
714

between the two houses. Even where the conference committee is

not by rule limited in its jurisdiction, legislative custom severely
limits the freedom with which new subject matter can be inserted
into the conference bill. But occasionally a conference committee
produces unexpected results, results beyond its mandate. These
excursions occur even where the rules impose strict limitations on
conference committee jurisdiction. This is symptomatic of the
authoritarian power of conference committee (Davies, Legislative
Law and Process: In A Nutshell, 1986 Ed., p. 81).’
It is a matter of record that the Conference Committee

Report on the bill in question was returned to and duly
approved by both the Senate and the House of
Representatives. Thereafter, the bill was enrolled with its
certification by Senate President Neptali A. Gonzales and
Speaker Ramon V. Mitra of the House of Representatives as
having been duly passed by both Houses of Congress. It was
then presented to and approved by President Corazon C.
Aquino on April 3, 1992.”
It would seem that if corrective measures are in order

to clip the powers of the Conference Committee, the
remedy should come from either or both chambers of
Congress, not from this Court, under the time-honored
doctrine of separation of powers.
Finally, as certified by the Secretary of the Senate
and the Secretary General of the House of
Representatives—
“This Act (Rep. Act No. 7716) is a consolidation of House Bill

No. 11197 and Senate Bill No. 1630 (w)as finally passed by
the House of Representatives and the Senate on April 27,
1994 and May 2, 1994 respectively.”
Under the long-accepted doctrine of the “enrolled bill,”

the Court in deference to a co-equal and coordinate
branch of government is held to a recognition of Rep.
Act No. 7716 as a law validly enacted by Congress and,
thereafter, approved by the President on 5 May 1994.
Again, we quote from our recent decision in Philippine
Judges Association, supra:
“Under the doctrine of separation of powers, the Court may

not inquire beyond the certification of the approval of a bill
from the presiding officers of Congress. Casco Philippine
Chemical Co. v. Gimenez6
_______________
6 7 SCRA 347.
715
VOL. 235, AUGUST 25, 1994 715

laid down the rule that the enrolled bill is conclusive upon
the Judiciary (except in matters that have to be entered in
the journals
7
like the yeas and nays on the final reading of the
bill). The journals are themselves also binding on the
Supreme Court, 8
as we held in the old (but still valid) case of
U.S. vs. Pons, where we explained the reason thus:
‘To inquire into the veracity of the journals of the Philippine

legislature when they are, as we have said, clear and explicit, would
be to violate both the letter and spirit of the organic laws by which
the Philippine Government was brought into existence, to invade a
coordinate and independent department of the Government, and to
interfere with the legitimate powers and functions of the
Legislature.’
Applying these principles, we shall decline to look into the

petitioners’ charges that an amendment was made upon the
last reading of the bill that eventually became R.A. No. 7354
and that copies thereof in its final form were not distributed
among the members of each House. Both the enrolled bill and
the legislative journals certify that the measure was duly
enacted i.e., in accordance with Article VI, Sec. 26(2) of the
Constitution. We are bound by such official assurances from
a coordinate department of the government, to which we owe,
at the very least, a becoming courtesy.”
III
Press Freedom and Religious Freedom and Rep. Act

No. 7716
The validity of the passage of Rep. Act No. 7716
notwithstanding, certain provisions of the law have to
be examined separately and carefully.
Rep. Act No. 7716 in imposing a value-added tax on
circulation income of newspapers and similar
publications and on income derived
9
from publishing
advertisements in newspapers, to my mind, violates
Sec. 4, Art. III of the Constitution. Indeed, even the
Executive Department has tried to cure this defect by
the issuance of BIR Regulation No. 11-94 precluding
implementation of the tax in this area. It should be
clear, however, that the BIR
_______________
7 Mabanag v. Lopez Vito, 78 Phil. 1.

8 34 Phil. 729.
9 Executive Order No. 273, in Sec. 103 (f), had exempted this kind
of income from the VAT. Rep. Act. No. 7716 removed the exemption.
716

regulation cannot amend the law (Rep. Act No. 7716).

Only legislation (as distinguished from administration
regulation) can amend an existing law.
Freedom of the press was virtually unknown in the
Philippines before 1900. In fact, a prime cause of the
revolution against Spain at the turn of the 19th
century was the repression of the freedom of speech
and expression and of the press. No less than our
national hero, Dr. Jose P. Rizal, in “Filipinas Despues
de Cien Anos” (The Philippines a Century Hence)
describing the reforms sine quibus non which the
Filipinos were insisting upon, stated: “The minister x x
x who wants his reforms to be reforms, must begin 10
by
declaring the press in the Philippines free x x x.”
Press freedom in the Philippines has met
repressions, most notable of which was the closure of
almost all forms of existing mass media upon the
imposition of martial law on 21 September 1972.
Section 4, Art. III of the Constitution maybe traced
to the United States Federal Constitution. The
guarantee of freedom of expression was planted in the
Philippines by President McKinley in the Magna Carta
of Philippine Liberty, Instructions to the Second
Philippine Commission on 7 April 1900.
The present constitutional provision which reads:
“Sec. 4. No law shall be passed abridging the freedom of

speech, of expression, or of the press, or the right of the
people peaceably to assemble and petition the government
for redress of grievances.”
is essentially the same as that guaranteed in the U.S.

Federal Constitution, for which reason, American case
law giving judicial expression as to its meaning is
highly persuasive in the Philippines.
The plain words of the provision reveal the clear
intention that no prior restraint can be imposed on the
exercise of free speech and expression if they are to
remain effective and meaningful.
The U.S. Supreme Court in the leading 11
case of
Grosjean v. American Press Co., Inc. declared a
statute imposing a gross
________________
10 United States v. Bustos, 37 Phil. 731.

11 297 U.S. 233.
717
VOL. 235, AUGUST 25, 1994 717

receipts license tax of 2% on circulation and
advertising income of newspaper publishers as
constituting a prior restraint which is contrary to the
guarantee of freedom of the press. 12
In Bantam Books, Inc. v. Sullivan, the U.S.
Supreme Court stated: “Any system of prior restraint
of expression comes to this Court bearing a heavy
presumption against its constitutionality.” In this
jurisdiction, prior restraint on the exercise of free
expression can be justified only on the ground that
there is a clear and present danger of a substantive
13
evil which the State has the right to prevent.
In the present case, the tax imposed on circulation
and advertising income of newspaper publishers is in
the nature of a prior restraint on circulation and free
expression and, absent a clear showing that the
requisite for prior restraint is present, the
constitutional flaw in the law is at once apparent and
should not be allowed to proliferate.
Similarly, the imposition of the VAT on the sale and
distribution of religious articles must be struck down
for being contrary to Sec. 5, Art. III of the Constitution
which provides:
“Sec. 5. No law shall be made respecting an establishment of

religion, or prohibiting the free exercise thereof. The free
exercise and enjoyment of religious profession and worship,
without discrimination or preference, shall forever be
allowed. No religious test shall be required for the exercise of
civil or political rights.”
That such a tax on the sale and distribution of

religious articles is unconstitutional, has been long
settled in American Bible Society, supra.
Insofar, therefore, as Rep. Act No. 7716 imposes a
value-added tax on the exercise of the above-discussed
two (2) basic constitutional rights, Rep. Act No. 7716
should be declared unconstitutional and of no legal
force and effect.
IV
Petitions of CREBA and PAL and Rep. Act No. 7716
_______________
12 372 U.S. 58.

13 American Bible Society v. City of Manila, 101 Phil. 386.
718

The Chamber of Real Estate and Builder’s Association,

Inc. (CREBA) filed its own petition (GR No. 11574)
arguing that the provisions of Rep. Act No. 7716
imposing a 10% value-added tax on the gross selling
price or gross value in money of every sale, barter or
exchange of goods or properties (Section 2) and a 10%
value-added tax on gross receipts derived from the sale
or exchange of services, including the use or lease of
properties (Section 3), violate the equal protection, due
process and non-impairment provisions of the
Constitution as well as the rule that taxation should be
uniform, equitable and progressive.
The issue of whether or not the value-added tax is
uniform, equitable and progressive has been settled in
Kapatiran.
CREBA which specifically assails the 10% value-
added tax on the gross selling price of real properties,
fails to distinguish between a sale of real properties
primarily held for sale to customers or held for lease in
the ordinary course of trade or business and isolated
sales by individual real property owners (Sec. 103[s]).
That those engaged in the business of real estate
development realize great profits is of common
knowledge and need not be discussed at length here.
The qualification in the law that the 10% VAT covers
only sales of real property primarily held for sale to
customers, i.e. for trade or business thus takes into
consideration a taxpayer’s capacity to pay. There is no
showing that the consequent distinction in real estate
sales is arbitrary and in violation of the equal
protection clause of the Constitution. The inherent
power to tax of the State, which is vested in the
legislature, includes the power to determine whom or
what to tax, as well as how much to tax. In the absence
of a clear showing that the tax violates the due process
and equal protection clauses of the Constitution, this
Court, in keeping with the doctrine of separation of
powers, has to defer to the discretion and judgment of
Congress on this point.
Philippine Airlines (PAL) in a separate petition
(G.R. No. 115852) claims that its franchise under PD
No. 1590 which makes it liable for a franchise tax of
only 2% of gross revenues “in lieu of all the other fees
and charges of any kind, nature or description,
imposed, levied, established, assessed or collected by
any municipal, city, provincial, or national authority or
government agency, now or in the future,” cannot be
amended by Rep. Act No. 7716 as to make it (PAL)
liable for a 10% value-added tax
719
VOL. 235, AUGUST 25, 1994 719

on revenues, because Sec. 24 of PD No. 1590 provides

that PAL’s franchise can only be amended, modified or
repealed by a special law specifically for that purpose.
The validity of PAL’s above argument can be tested
by ascertaining the true intention of Congress in
enacting Rep. Act No. 7716. Sec. 4 thereof dealing with
Exempt Transactions states:
“Section 103. Exempt Transactions.—The following shall be

exempt from the value-added tax:
xxx
(q) Transactions which are exempt under special laws,
except those granted under Presidential Decrees No. 66 , 529,
972, 1491, 1590, x x x” (emphasis supplied)
The repealing clause of Rep. Act No. 7716 further

reads:
“Sec. 20. Repealing clauses.—The provisions of any special

law relative to the rate of franchise taxes are hereby expressly
repealed.
xxx
All other laws, orders, issuances, rules and regulations or
parts thereof inconsistent with this Act are hereby repealed,
amended or modified accordingly” (emphasis supplied)
There can be no dispute, in my mind, that the clear

intent of Congress was to modify PAL’s franchise with
respect to the taxes it has to pay. To this extent, Rep.
Act No. 7716 can be considered as a special law
amending PAL’s franchise and its tax liability
thereunder. That Rep. Act No. 7716 imposes the value-
added taxes on other subjects does not make it a
general law which cannot amend PD No. 1590.
To sum up: it is my considered view that Rep. Act
No. 7716 (the expanded value-added tax) is a valid law,
viewed from both substantive and procedural
standards, except only insofar as it violates Secs. 4 and
5, Art. III of the Constitution (the guarantees of
freedom of expression and the free exercise of religion).
To that extent, it is, in its present form,
unconstitutional.
I, therefore, vote to DISMISS the petitions, subject
to the above qualification.
720

SEPARATE OPINION
VITUG, J.:
Lest we be lost by a quagmire of trifles, the real

threshold and prejudicial issue, to my mind, is whether
or not this Court is ready to assume and to take upon
itself with an overriding authority the awesome
responsibility of overseeing the entire bureaucracy. Far
from it, ours is merely to construe and to apply the law
regardless of its wisdom and salutariness, and to strike
it down only when it clearly disregards constitutional
proscriptions. It is what the fundamental law
mandates, and it is what the Court must do.
I cannot yet concede to the novel theory, so
challengingly provocative as it might be, that under
the 1987 Constitution the Court may now at good
liberty intrude, in the guise of the people’s imprimatur,
into every affair of government. What significance can
still then remain, I ask, of the time honored and widely
acclaimed principle of separation of powers, if at every
turn the Court allows itself to pass upon, at will, the
disposition of a co-equal, independent and coordinate
branch in our system of government. I dread to think
of the so varied uncertainties that such an undue
interference can lead to. The respect for long standing
doctrines in our jurisprudence, nourished through
time, is one of maturity not timidity, of stability rather
than quiescence.
It has never occurred to me, and neither do I believe
it has been intended, that judicial tyranny is
envisioned, let alone institutionalized, by our people in
the 1987 Constitution. The test of tyranny is not solely
on how it is wielded but on how, in the first place, it
can be capable of being exercised. It is time that any
such perception of judicial omnipotence is corrected.
Against all that has been said, I see, in actuality in
these cases at bench, neither a constitutional
infringement of substance, judging from precedents
already laid down by this Court in previous cases, nor
a justiciability even now of the issues raised, more
than an attempt to sadly highlight the perceived short
comings in the procedural enactment of laws, a matter
which is internal to Congress and an area that is best
left to its own basic concern. The fact of the matter is
that the legislative enactment,
721
VOL. 235, AUGUST 25, 1994 721

in its final form, has received the ultimate approval of

both houses of Congress. The finest rhetoric, indeed
fashionable in the early part of this closing century,
would still be a poor substitute for tangibility. I join,
nonetheless, some of my colleagues in respectfully
inviting the kind attention of the honorable members
of our Congress in the suggested circumspect
observance of their own rules.
A final remark. I should like to make it clear that
this opinion does not necessarily foreclose the right,
peculiar to any taxpayer adversely affected, to pursue
at the proper time, in appropriate proceedings, and in
proper fora, the specific remedies prescribed therefor
by the National Internal Revenue Code, Republic Act
1125, and other laws, as well as rules of procedure,
such as may be pertinent. Some petitions filed with
this Court are, in essence, although styled differently,
in the nature of declaratory relief over which this
Court is bereft of original jurisdiction.
All considered, I, therefore, join my colleagues who
are voting for the dismissal of the petitions.
DISSENTING OPINION
REGALADO, J.:
It would seem like an inconceivable irony that

Republic Act No. 7716 which, so respondents claim,
was conceived by the collective wisdom of a bicameral
Congress and crafted with sedulous care by two
branches of government should now be embroiled in
challenges to its validity for having been enacted in
disregard of mandatory prescriptions of the
Constitution itself. Indeed, such impugnment by
petitioners goes beyond merely the procedural flaws in
the parturition of the law. Creating and regulating as
it does definite rights to property, but with its own
passage having been violative of explicit provisions of
the organic law, even without going into the intrinsic
merits of the provisions of Republic Act No. 7716 its
substantive invalidity is pro facto necessarily entailed.
How it was legislated into its present statutory
existence is not in serious dispute and need not detain
us except for a recital of some salient and relevant
facts. The House of Representatives
722

1
passed House Bill No. 11197 on third reading on
November 17, 1993 and, the following day, it
transmitted the same to the Senate for concurrence.
On its part, the Senate approved Senate Bill No. 1630
on second and third readings on March 24, 1994. It is
important to note in this regard that on March 22,
1994, said S.B. No. 1630 had been certified by
President Fidel V. Ramos for immediate enactment to
meet a public emergency, that is, a growing budgetary
deficit. There was no such certification for H.B. No.
11197 although it was the initiating revenue bill.
It is, therefore, not only a curious fact but, more
importantly, an invalid procedure since that
Presidential certification was erroneously made for
and confined to S.B. No. 1630 which was indisputably
a tax bill and, under the Constitution, could not validly
originate in the Senate. Whatever is claimed in favor of
S.B. No. 1630 under the blessings of that certification,
such as its alleged exemption from the three separate
readings requirement, is accordingly negated and
rendered inutile by the inefficacious nature of said
certification as it could lawfully have been issued only
for a revenue measure originating exclusively from the
lower House. To hold otherwise would be to validate a
Presidential certification of a bill initiated in the
Senate despite the Constitutional prohibition against
its originating therefrom.
Equally of serious significance is the fact that S.B.
No. 1630 was reported out in Committee Report No.
349 submitted to the Senate on February 7, 1994 and
approved by that body “in substitution of S.B. No.
1129,” while merely “taking2 into consideration P.S. No.
734 and H.B. No. 11197.” S.B. No. 1630, therefore,
was never filed in substitution of either P.S. No. 734
or, more emphatically, of H.B. No. 11197 as these two
legislative issuances were merely taken account of, at
the most, as referential bases or materials.
This is not a play on misdirection for, in the first
instance, the respondents assure us that H.B. No.
11197 was actually the sole
_______________
1 In substitution of H.B. Nos. 253, 771, 2450, 7033, 8086, 9030,

9210, 9297, 10012 and 10100 which were filed over the period from
July 22, 1992 to August 3, 1993.
2 P.S. Res. No. 734 had earlier been filed in the Senate on
September 10, 1992, while S.B. No. 1129 was filed on March 1, 1993.
723
VOL. 235, AUGUST 25, 1994 723

source of and started the whole legislative process

which culminated in Republic Act No. 7716. The
participation of the Senate in enacting S.B. No. 1630
was, it is claimed, justified as it was merely in
pursuance of its power to concur in or propose
amendments to H.B. No. 11197. Citing3 the 83-year old
case of Flint vs. Stone Tracy Co., it is blithely
announced that such power to amend includes an
amendment by substitution, that is, even to the extent
of substituting the entire H.B. No. 11197 by an
altogether completely new measure of Senate
provenance. Ergo, so the justification goes, the Senate
acted perfectly in accordance with its amending power
under Section 24, Article VI of the Constitution since it
merely proposed amendments through a bill allegedly
prepared in advance.
This is a mode of argumentation which, by reason of
factual inaccuracy and logical implausibility, both
astounds and confounds. For, it is of official record that
S.B. No. 1630 was filed, certified and enacted in
substitution of S.B. No. 1129 which in itself was
likewise in derogation of the Constitutional prohibition
against such initiation of a tax bill in the Senate. In
any event, S.B. No. 1630 was neither intended as a bill
to be adopted by the Senate nor to be referred to the
bicameral conference committee as a substitute for
H.B. No. 11197. These indelible facts appearing in
official documents cannot be erased by any amount of
strained convolutions or incredible pretensions that
S.B. No. 1630 was supposedly enacted in anticipation
of H.B. No. 11197.
On that score alone, the invocation by the Solicitor
General of the hoary concept of amendment by
substitution falls flat on its face. Worse, his
concomitant citation of Flint to recover from that prone
position only succeeded in turning the same
postulation over, this time supinely flat on its back. As
elsewhere noted by some colleagues, which I will just
refer to briefly to avoid duplication, respondents
initially sought sanctuary in that doctrine supposedly
laid down in Flint, thus: “It has, in fact, been held that
the substitution of an entirely new measure for the one
originally proposed
4
can be supported as a valid
amendment.” (Emphasis supplied.) During the
interpellation by the writer at
_______________
3 220 U.S. 107, 55 L.Ed. 389 (1911).

4 Consolidated Comment, 36-37.
724

the oral argument held in these cases, the attention of

the Solicitor General was called to the fact that the
amendment in Flint consisted only of a single item,
that is, the substitution of a corporate tax for an
inheritance tax proposed in a general revenue bill; and
that the text of the decision therein nowhere contained
the supposed doctrines he quoted and ascribed to the
court, as those were merely summations of arguments
of counsel therein. It is indeed a source of
disappointment for us, but an admission of desperation
on his part, that, instead of making a clarification or a
defense of his contention,5 the Solicitor General merely
reproduced all over again the same quotations as they
appeared in his original consolidated comment,
without venturing any explanation or justification.
The aforestated dissemblance, thus unmasked, has
further undesirable implications on the contentions
advanced by respondents in their defense. For, even
indulging respondents ex gratia argumenti in their
pretension that S.B. No. 1630 substituted or replaced
H.B. No. 11197, aside from muddling the issue of the
true origination of the disputed law, this would further
enmesh respondents in a hopeless contradiction.
In a publication authorized by the Senate and from
which the Solicitor General has liberally quoted, it is
reported as an accepted rule therein that “(a)n
amendment by substitution when approved takes the
place6 of the principal bill. C.R. March 19, 1963, p.
943.” Stated elsewise, the principal bill is supplanted
and goes out of actuality. Applied to the present
situation, and following respondents’ submission that
H.B. No. 11197 had been substituted or replaced in its
entirety, then in law it had no further existence for
purposes of the subsequent stages of legislation except,
possibly, for referential data.
Now, the enrolled bill thereafter submitted to the
President of the Philippines, signed by the President of
the Senate and the Speaker of the House of
Representatives, carried this solemn certification over
the signatures of the respective secretaries of
________________
5 Consolidated Memorandum for Respondents, 56-57.

6 Orquiola, H. M., Annotated Rules of the Senate and Procedure,
Precedents and Practices of the Senate of the Republic of the
Philippines since 1946, 1991 Ed., 108.
725
VOL. 235, AUGUST 25, 1994 725

both chambers: “This Act which is a consolidation of

House Bill No. 11197 and Senate Bill No. 1630 was
finally passed by the House of Representatives and the
Senate on April 27, 1994, and May 2, 1994.” (Italics
mine.) In reliance thereon, the Chief Executive signed
the same into law as Republic Act No. 7716.
The confusion to which the writer has already
confessed is now compounded by that official text of
the aforequoted certification which speaks, and this
cannot be a mere lapsus calami, of two independent
and existing bills (one of them being H.B. No. 11197)
which were consolidated to produce the enrolled bill. In
parliamentary usage,7 to consolidate two bills, is to
unite them into one and which, in the case at bar,
necessarily assumes that H.B. No. 11197 never became
legally inexistent. But did not the Solicitor General,
under the theory of amendment by substi-tution of the
entire H.B. No. 11197 by S.B. No. 1630, thereby
premise the same upon the replacement, hence the
total elimination from the legislative process, of H.B.
11197?
It results, therefore, that to prove compliance with
the requirement for the exclusive origination of H.B.
No. 11197, two alternative but inconsistent theories
had to be espoused and defended by respondents’
counsel. To justify the introduction and passage of S.B.
No. 1630 in the Senate, it was supposedly enacted only
as an amendment by substitution, hence on that theory
H.B. No. 11197 had to be considered as displaced and
terminated from its role or existence. Yet, likewise for
the same purpose but this time on the theory of
origination by consolidation, H.B. No. 11197 had to be
resuscitated so it could be united or merged with S.B.
No. 1630. This latter alternative theory, unfortunately,
also exacerbates the constitutional defect for then it is
an admission of a dual origination of the two tax bills,
each respectively initiated in and coming from the
lower and upper chambers of Congress.
Parenthetically, it was also this writer who
pointedly brought this baffling situation to the
attention of the Solicitor General during the aforesaid
oral argument, to the extent of reading aloud the
certification in full. We had hoped thereby to be
clarified on these vital issue in respondents’ projected
memo-
_______________
7 Black’s Law Dictionary, 4th Ed. (1951), 381, citing Fairview vs.
Durham, 45 Iowa 56.
726

randum, but we have not been favored with an
explanation unraveling this dilemma. Verily, by
passing sub silentio on these intriguing submissions,
respondents have wreaked havoc on both logic and law
just to gloss over their non-compliance with the
Constitutional mandate for exclusive origination of a
revenue bill. The procedure required therefor, we
emphatically add, can be satisfied only by complete
and strict compliance since this is laid down by the
Constitution itself and not by a mere statute.
This writer consequently agrees with the clearly
tenable proposition of petitioners that when the Senate
passed and approved S.B. No. 1630, had it certified by
the Chief Executive, and thereafter caused its
consideration by the bicameral conference committee
in total substitution of H.B. No. 11197, it clearly and
deliberately violated the requirements of the
Constitution not only in the origination of the bill but
in the very enactment of Republic Act No. 7716.
Contrarily, the shifting sands of inconsistency in the
arguments adduced for respondents betray such lack of
intellectual rectitude as to give the impression of being
mere rhetorics in defense of the indefensible.
We are told, however, that by our discoursing on the
foregoing issues we are intruding into non-justiciable
areas long declared verboten by such time-honored
doctrines as those on political questions, the enrolled
bill theory and the respect due to two co-equal and
coordinate branches of Government, all derived from
the separation of powers inherent in republicanism.
We appreciate the lectures, but we are not 8
exactly
unaware of the 9
teachings in U.S. vs. Pons, Mabanag
vs. Lopez Vito, Casco10Philippine Chemical Co., Inc.
11
vs.
Gimenez, etc., et al., Morales vs. Subido, etc., and
Philippine 12Judges Association, etc., et al. vs. Prado,
etc., et al., on13the one hand, and Tañada, et al. vs.
Cuenco, et al., 14 Sanidad, et al. vs. Commission on
Elections, et al., and
________________
8 34 Phil. 729 (1916).
9 78 Phil. 1 (1947).
10 L-17931, February 28, 1963, 7 SCRA 347.
11 L-29658, February 27, 1969, 27 SCRA 131.
12 G.R. No. 105371, November 11, 1993, 227 SCRA 703.
13 103 Phil. 1051 (1957).
14 L-46640, October 12, 1976, 73 SCRA 333.
727
VOL. 235, AUGUST 25, 1994 727

15
Daza vs. Singson, et al., on the other, to know which
would be applicable to the present controversy and
which should be rejected.
But, first, a positional exordium. The writer of this
opinion would be among the first to acknowledge and
enjoin not only courtesy to, but respect for, the official
acts of the Executive and Legislative departments, but
only so long as the same are in accordance with or are
defensible under the fundamental charter and the
statutory law. He would readily be numbered in the
ranks of those who would preach a reasoned sermon on
the separation of powers, but with the qualification
that the same are not contained in tripartite
compartments separated by imper-meable membranes.
He also ascribes to the general validity of American
constitutional doctrines as a matter of historical and
legal necessity, but not to the extent of being oblivious
to political changes or unmindful of the fallacy of
undue generalization arising from myopic disregard of
the factual setting of each particular case.
These ruminations have likewise been articulated
and dissected by my colleagues, hence it is felt that the
only issue which must be set aright in this dissenting
opinion is the so-called enrolled bill doctrine to which
we are urged to cling with reptilian tenacity. It will be
preliminarily noted that the official certification
appearing right on the face of Republic Act No. 7716
would even render unnecessary any further judicial
inquiry into the proceedings which transpired in the
two legislative chambers and, on a parody of
tricameralism, in the bicameral conference committee.
Moreover, we have the excellent dissertations of some
of my colleagues on these matters, but respondents
insist en contra that the congressional proceedings
cannot properly be inquired into by this Court. Such
objection confirms a suppressive pattern aimed at
sacrificing the rule of law to the fiat of expediency.
Respondents thus emplaced on their battlements
the pronouncement of this Court in the aforecited 16
case
of Philippine Judges Association vs. Prado. Their
reliance thereon falls into the same error committed by
their seeking refuge in the Flint case, ante., which, as
has earlier been demonstrated (aside from
________________
15 G.R. No. 86344, December 21, 1989, 180 SCRA 496.

728

the quotational misrepresentation), could not be on par

with the factual situation in the present case. Flint, to
repeat, involved a mere amendment on a single
legislative item, that is, substituting the proposal
therein of an inheritance tax by one on corporate tax.
Now, in their submission based on Philippine Judges
Association, respondents studiously avoid mention of
the fact that the questioned insertion referred likewise
to a single item, that is, the repeal of the franking
privilege theretofore granted to the judiciary. That
both cases cannot be equated with those at bar,
considering the multitude of items challenged and the
plethora of constitutional violations involved, is too
obvious to belabor. Legal advocacy and judicial
adjudication must have a becoming sense of qualitative
proportion, instead of lapsing into the discredited and
maligned practice of yielding blind adherence to
precedents.
The writer unqualifiedly affirms his respect for
valid official acts of the two branches of government
and eschews any unnecessary intrusion into their
operational management and internal affairs. These,
without doubt, are matters traditionally protected by
the republican principle of separation of powers.
Where, however, there is an overriding necessity for
judicial intervention in light of the pervasive
magnitude of the problems presented and the gravity
of the constitutional violations alleged, but this Court
cannot perform its constitutional duty expressed in
Section 1, Article VIII of the Constitution unless it
makes the inescapable inquiry, then the confluence of
such factors should compel an exception to the rule as
an ultimate recourse. The cases now before us present
both the inevitable challenge and the inescapable
exigency for judicial review. For the Court to now shirk
its bounden duty would not only project it as a citadel
of the timorous and the slothful, but could even
undermine its raison d’etre as the highest and ultimate
tribunal.
Hence, this dissenting opinion has touched on
events behind and which transpired prior to the
presentation of the enrolled bill for approval into law.
The details of that law which resulted from the
legislative action followed by both houses of Congress,
the substantive validity of whose provisions and the
procedural validity of which legislative process are
here challenged as unconstitutional, have been
graphically presented by petitioners and admirably
explained in the respective opinions of my brethren.
The writer concurs in the conclusions drawn therefrom
and
729
VOL. 235, AUGUST 25, 1994 729
rejects the contention that we have unjustifiably

breached the dike of the enrolled bill doctrine.
Even in the land of its source, the so-called
conclusive presumption of validity originally attributed
to that doctrine has long been revisited and qualified,
if not altogether rejected. On the competency of judicial
inquiry, it has been held that “(u)nder the ‘enrolled bill
rule’ by which an enrolled bill is sole expository of its
contents and conclusive evidence of its existence and
valid enactment, it is nevertheless competent for
courts to inquire as to what prerequisites are fixed by
the Constitution of which journals of respective houses
17
of Legislature are required to furnish the evidence.”
18
In fact, in Gwynn vs. Hardee, etc., et al., the
Supreme Court of Florida declared:
“(1) While the presumption is that the enrolled bill, as signed

by the legislative officers and filed with the secretary of
state, is the bill as it passed, yet this presumption is not
conclusive, and when it is shown from the legislative journals
that a bill though engrossed and enrolled, and signed by the
legislative officers, contains provisions that have not passed
both houses, such provisions will be held spurious and not a
part of the law. As was said by Mr. Justice Cockrell in the
case of Wade vs. Atlantic Lumber Co., 51 Fla. 628, text 633,
41 So. 72, 73:
‘This Court is firmly committed to the holding that when the

journals speak they control, and against such proof the enrolled bill
is not conclusive.’ ”
More enlightening and apropos to the present

controversy is the decision promulgated on May 13,
1980 by the Supreme Court of Kentucky in D & W 19
Auto Supply, et al. vs. Department of Revenue, et al.,
pertinent excerpts wherefrom are extensively
reproduced hereunder:
_______________
17 Brailsford vs. Walker, 31 S.E. 2d 385, 387, 388, 205 S.C. 228.
18 110 So. 343, 346.
19 602 South Western Reporter, 2d Series, 402-425, jointly
deciding Carrollton Wholesale Tobaccos, Inc. et al. vs. Department of
Revenue, et al., and Bluegrass Provisions Co., Inc., et al. vs.
Department of Revenue, et al.
730

“x x x In arriving at our decision we must, perforce,

reconsider the validity of a long line of decisions of this court
which created and nurtured the so-called ‘enrolled bill’
doctrine.
xxx
“[1] Section 46 of the Kentucky Constitution sets out
certain procedures that the legislature must follow before a
bill can be considered for final passage. x x x.
xxx
“x x x Under the enrolled bill doctrine as it now exists in
Kentucky, a court may not look behind such a bill, enrolled
and certified by the appropriate officers, to determine if there
are any defects.
xxx
“x x x In Lafferty, passage of the law in question violated
this provision, yet the bill was properly enrolled and
approved by the governor. In declining to look behind the law
to determine the propriety of its enactment, the court
enunciated three reasons for adopting the enrolled bill rule.
First, the court was reluctant to scrutinize the processes of
the legislature, an equal branch of government. Second,
reasons of convenience prevailed, which discouraged
requiring the legislature to preserve its records and
anticipated considerable complex litigation if the court ruled
otherwise. Third, the court acknowledged the poor record-
keeping abilities of the General Assembly and expressed a
preference for accepting the final bill as enrolled, rather than
opening up the records of the legislature. x x x.
xxx
“Nowhere has the rule been adopted without reason, or as
a result of judicial whim. There are four historical bases for
the doctrine. (1) An enrolled bill was a ‘record’ and, as such,
was not subject to attack at common law. (2) Since the
legislature is one of the three branches of government, the
courts, being coequal, must indulge in every presumption
that legislative acts are valid. (3) When the rule was
originally formulated, record-keeping of the legislatures was
so inadequate that a balancing of equities required that the
final act, the enrolled bill, be given efficacy. (4) There were
theories of convenience as expressed by the Kentucky court
in Lafferty.
“The rule is not unanimous in the several states, however,
and it has not been without its critics. From an examination
of cases and treaties, we can summarize the criticisms as
follows: (1) Artificial presumptions, especially conclusive ones,
are not favored. (2) Such a rule frequently (as in the present
case) produces results which do not accord with facts or
constitutional provisions. (3) The rule is conducive to fraud,
forgery, corruption and other wrongdoings. (4) Modern
automatic and electronic record-keeping devices now used by
legislatures
731
VOL. 235, AUGUST 25, 1994 731

remove one of the original reasons for the rule. (5) The rule
disregards the primary obligation of the courts to seek the
truth and to provide a remedy for a wrong committed by any
branch of government. In light of these considerations, we are
convinced that the time has come to re-examine the enrolled
bill doctrine.
“[2] This court is not unmindful of the admonition of the
doctrine of stare decisis. The maxim is “Stare decisis et non
quieta movere,” which simply suggests that we stand by
precedents and not disturb settled points of law. Yet, this rule
is not inflexible, nor is it of such a nature as to require
perpetuation of error or logic. As we stated in Daniel’s Adm’r
v. Hoofnel, 287 Ky 834, 155 S.W.2d 469, 471-72 (1941)
(citations omitted):
The force of the rule depends upon the nature of the question to be
decided and the extent of the disturbance of rights and practices
which a change in the interpretation of the law or the course of
judicial opinions may create. Cogent considerations are whether
there is clear error and urgent reasons ‘for neither justice nor
wisdom requires a court to go from one doubtful rule to another,’
and whether or not the evils of the principle that has been followed
will be more injurious than can possibly result from a change.
Certainly, when a theory supporting a rule of law is not

grounded on facts, or upon sound logic, or is unjust, or has
been discredited by actual experience, it should be discarded,
and with it the rule it supports.
“[3] It is clear to us that the major premise of the Lafferty
decision, the poor record-keeping of the legislature, has
disappeared. Modern equipment and technology are the rule
in record-keeping by our General Assembly. Tape recorders,
electric typewriters, duplicating machines, recording
equipment, printing presses, computers, electronic voting
machines, and the like remove all doubts and fears as to the
ability of the General Assembly to keep accurate and readily
accessible records.
“It is also apparent that the ‘convenience’ rule is not
appropriate in today’s modern and developing judicial
philosophy. The fact that the number and complexity of
lawsuits may increase is not persuasive if one is mindful that
the overriding purpose of our judicial system is to discover the
truth and see that justice is done. The existence of difficulties
and complexities should not deter this pursuit and we reject
any doctrine or presumption that so provides.
“Lastly, we address the premise that the equality of the
various branches of government requires that we shut our
eyes to constitutional failings and other errors of our
coparceners in government. We simply do not agree. Section
26 of the Kentucky Constitution provides that any
732

law contrary to the constitution is ‘void.’ The proper exercise

of judicial authority requires us to recognize any law which is
unconstitutional and to declare it void. Without belaboring
the point, we believe that under section 228 of the Kentucky
Constitution it is our obligation to ‘support . . . the
Constitution of the commonwealth.’ We are sworn to see that
violations of the constitution—by any person, corporation,
state agency or branch of government—are brought to light
and corrected. To countenance an artificial rule of law that
silences our voices when confronted with violations of our
constitution is not acceptable to this court.
“We believe that a more reasonable rule is the one which
Professor Sutherland describes as the ‘extrinsic evidence’
rule. x x x. Under this approach there is a prima facie
presumption that an enrolled bill is valid, but such
presumption may be overcome by clear, satisfactory and
convincing evidence establishing that constitutional
requirements have not been met.
“We therefore overrule Lafferty v. Huffman and all other
cases following the so-called enrolled bill doctrine, to the
extent that there is no longer a conclusive presumption that
an enrolled bill is valid. x x x” (Emphases mine.)
Undeniably, the value-added tax system may have its

own merits to commend its continued adoption, and
the proposed widening of its base could achieve
laudable governmental objectives if properly
formulated and conscientiously implemented. We
would like to believe, however, that ours is not only an
enlightened democracy nurtured by a policy of
transparency but one where the edicts of the
fundamental law are sacrosanct for all, barring none.
While the realization of the lofty ends of this
administration should indeed be the devout wish of all,
likewise barring none, it can never be justified by
methods which, even if unintended, are suggestive of
Machiavellism.
Accordingly, I vote to grant the instant petitions
and to invalidate Republic Act No. 7716 for having
been enacted in violation of Section 24, Article VI of
the Constitution.
DISSENTING OPINION
DAVIDE, JR., J.:
The legislative history of R.A. No. 7716, as highlighted

in the Consolidated Memorandum for the public
respondents submitted
733
VOL. 235, AUGUST 25, 1994 733

by the Office of the Solicitor General, demonstrates

beyond doubt that it was passed in violation or
deliberate disregard of mandatory provisions of the
Constitution and of the rules of both chambers of
Congress relating to the enactment of bills.
I therefore vote to strike down R.A. No. 7716 as
unconstitutional and as having been enacted with
grave abuse of discretion.
The Constitution provides for a bicameral Congress.
Therefore, no bill can be enacted into law unless it is
approved by both chambers—the Senate and the
House of Representatives (hereinafter House).
Otherwise stated, each chamber may propose and
approve a bill, but until it is submitted to the other
chamber and passed by the latter, it cannot be
submitted to the President for its approval into law.
Paragraph 2, Section 26, Article VI of the
Constitution provides:
“No bill passed by either House shall become a law unless it
has passed three readings on separate days, and printed
copies thereof in its final form have been distributed to its
Members three days before its passage, except when the
President certifies to the necessity of its immediate
enactment to meet a public calamity or emergency. Upon the
last reading of a bill, no amendment thereto shall be allowed,
and the vote thereon shall be taken immediately thereafter,
and the yeas and nays entered in the Journal.”
The “three readings” refer to the three readings in both

chambers.
There are, however, bills which must originate
exclusively in the House. Section 24, Article VI of the
Constitution enumerates them:
“SEC. 24. All appropriation, revenue or tariff bills, bills

concur with amendments.”
1
Webster’s Third New International Dictionary defines
originate as follows:
“vt 1: to cause the beginning of: give rise to: INITIATE . . . 2.

to start (a person or thing) on a course of journey . . . vi: to
take or have
________________
1 1971 ed., 1592.
734

origin: be derived: ARISE, BEGIN, START . . .”

2
Black’s Law Dictionary defines the word exclusively in
this wise:
“Apart from all others; only; solely; substantially all or for
the greater part. To the exclusion of all others; without
admission of others to participation; in a manner to exclude.”
In City Mayor3
vs. The Chief of Philippine
Constabulary, this Court said:
“The term ‘exclusive’ in its usual and generally accepted

sense, means possessed to the exclusion of others;
appertaining to the subject alone, not including, admitting or
pertaining to another or others, undivided, sole. (15 Words
and Phrases, p. 510, citing Mitchel v. Tulsa Water, Light,
Heat and Power Co., 95 P. 961, 21 Okl. 243; and p. 513,
citing Commonwealth v. Superintendent of House of
Correction, 64 Pa. Super. 613, 615).”
Indisputably then, only the House can cause the

beginning or initiate the passage of any appropriation,
revenue, or tariff bill, any bill increasing the public
debt, any bill of local application, or any private bill.
The Senate can only “propose or concur with
amendments.”
Under the Rules of the Senate, the first reading is
the reading of the title of the bill and its referral to the
corresponding committee; the second reading consists
of the reading of the bill in the form recommended by
the corresponding committee; and the third reading is
the reading of the bill in the4 form it will be after
approval on second reading. During the second
reading, the following takes place:
(1) Second reading of the bill;

(2) Sponsorship by the Committee Chairman or
any member designated by the corresponding
committee;
_______________
2 Sixth Edition (1990), 565, citing Standard Oil Co. of Texas vs.
State, Tex. Civ. App., 142 S.W.2d 519, 521, 522, 523.
3 21 SCRA 665, 673 [1967].
4 Sections 52 and 53, Rule XXIII.
735
VOL. 235, AUGUST 25, 1994 735

(3) If a debate ensues, turns for and against the

bill shall be taken alternately;
(4) The sponsor of the bill closes the debate;
(5) After the close of the debate, the period of
amendments follows;
(6) Then, after the period of amendments is5 closed,
the voting on the bill on second reading.
After approval on second reading, printed copies

thereof in its final form shall be distributed to the
Members of the Senate at least three days prior to the
third reading, except in cases of certified bills. At the
third reading, the final vote shall be taken6 and the
yeas and nays shall be entered in the Journal.
Under the Rules of the House, the first reading of a
bill consists of a reading of the number, title, and
author followed
7
by the referral to the appropriate
committees; the second reading consists of the reading
in full of the bill with
8
the amendments proposed by the
committee, if any; and the third reading is the reading
of the bill in the form as approved on second reading
and takes place only after printed copies thereof in its
final form have been distributed to the Members9 at
least three days before, unless the bill is certified. At
the second reading, the following takes place:
(1) Reading of the bill;

(2) Sponsorship;
(3) Debates;
(4) Period of Amendments; and
10
(5) Voting on Second Reading.
At the third reading, the votes shall be taken
immediately
11
and the yeas and nays entered in the
Journal.
_______________
5 Section 57, Rule XXV.

6 Section 26(2), Article VI, Constitution; paragraph (7), Section 57,
Rule XXV.
7 Section 69, Rule XIV.
8 Section 77, Id.
9 Section 82, Rule XIV.
10 Sections 77-81, Id.
11 Section 82, Id., in relation to Section 26(2), Article VI,
Constitution.
736

Clearly, whether in the Senate or in the House, every

bill must pass the three readings on separate days,
except when the bill is certified. Amendments to 12the
bill on third reading are constitutionally prohibited.
After its passage by one chamber, the bill should
then be transmitted to the other chamber for its
concurrence. Section 83, Rule XIV of the Rules of the
House expressly provides:
“SEC. 83. Transmittal to Senate.—The Secretary General,

without need of express order, shall transmit to the Senate
for its concurrence all the bills and joint or concurrent
resolutions approved by the House or the amendments of the
House to the bills or resolutions of the Senate, as the case
may be. If the measures approved without amendments are
bills or resolutions of the Senate, or if amendments of the
Senate to bills of the House are accepted, he shall forthwith
notify the Senate of the action taken.”
Simplified, this rule means that:
1. As to a bill originating in the House:
(a) Upon its approval by the House, the bill shall

be transmitted to the Senate;
(b) The Senate may approve it with or without
amendments;
(c) The Senate returns the bill to the House;
(d) The House may accept the Senate
amendments; if it does not, the Secretary
General shall notify the Senate of that action.
As hereinafter be shown, a request for
conference shall then be in order.
2. As to bills originating in the Senate:
(a) Upon its approval by the Senate, the bill shall

be transmitted to the House;
(b) The House may approve it with or without
amendments;
(c) The House then returns it to the Senate,
informing it of the action taken;
(d) The Senate may accept the House
amendments; if it does not, it shall notify the
House and make a request for conference.
The transmitted bill shall then pass three readings in

the other chamber on separate days. Section 84, Rule
XIV of the
________________
12 Section 26(2), Article VI, Constitution.
737
VOL. 235, AUGUST 25, 1994 737

Rules of the House states:
“SEC. 84. Bills from the Senate.—The bills, resolutions and

communications of the Senate shall be referred to the
corresponding committee in the same manner as bills
presented by Members of the House.”
and Section 51, Rule XXIII of the Rules of the Senate

provides:
“SEC. 51. Prior to their final approval, bills and joint

resolutions shall be read at least three times.”
It is only when the period of disagreement is reached,

i.e., amendments proposed by one chamber to a bill
originating from the other are not accepted by the
latter, that a request for conference is made or is in
order. The request for conference is specifically covered
by Section 26, Rule XII of the Rules of the Senate
which reads:
“SEC. 26. In the event that the Senate does not agree with
the House of Representatives on the provision of any bill or
joint resolution, the differences shall be settled by a
conference committee of both Houses which shall meet
within ten days after its composition.”
and Section 85, Rule XIV of the Rules of the House

which reads:
“SEC. 85. Conference Committee Reports.—In the event that

amendments to any bill or joint resolution, the differences
may be settled by conference committees of both Chambers.”
The foregoing provisions of the Constitution and the

Rules of both chambers of Congress are mandatory. 13
In his Treatise On The Constitutional Limitations,
more particularly on enactment of bills, Cooley states:
_________________
13 Volume I, Eight Edition, Chapter VI, 267. See Miller vs. Mardo,
2 SCRA 898 [1961]; Everlasting Pictures, Inc. vs. Fuentes, 3 SCRA
539 [1961].
738

“Where, for an instance, the legislative power is to be

exercised by two houses, and by settled and well-understood
parliamentary law these two houses are to hold separate
sessions for their deliberations, and the determination of the
one upon a proposed law is to be submitted to the separate
determination of the other, the constitution, in providing for
two houses, has evidently spoken in reference to this settled
custom, incorporating it as a rule of constitutional
interpretation; so that it would require no prohibitory clause
to forbid the two houses from combining in one, and jointly
enacting laws by the vote of a majority of all. All those rules
which are of the essentials of law-making must be observed
and followed; and it is only the customary rules of order and
routine, such as in every deliberative body are always
understood to be under its control, and subject to constant
change at its will, that the constitution can be understood to
have left as matters of discretion, to be established, modified,
or abolished by the bodies for whose government in non-
essential matters they exist.”
In respect of appropriation, revenue, or tariff bills, bills

increasing the public debt, bills of local application, or
private bills, the return thereof to the House after the
Senate shall have “proposed or concurred with
amendments” for the former either to accept or reject
the amendments would not only be in conformity with
the foregoing rules but is also implicit from Section 24
of Article VI.
With the foregoing as our guiding light, I shall now
show the violations of the Constitution and of the
Rules of the Senate and of the House in the passage of
R.A. No. 7716.
VIOLATIONS OF SECTION 24, ARTICLE VI OF

THE CONSTITUTION:
First violation.—Since R.A. No. 7716 is a revenue

measure, it must originate exclusively in the House—
not in the Senate. As correctly asserted by petitioner
Tolentino, on the face of the enrolled copy of R.A. No.
7716, it is a “CONSOLIDATION OF HOUSE BILL
NO. 11197 AND SENATE BILL NO. 1630.” In short, it
is an illicit marriage of a bill which originated in the
House and a bill which originated in the Senate.
Therefore, R.A. No. 7716 did not originate exclusively
in the House.
The only bill which could serve as a valid basis for
R.A. No. 7716 is House Bill (HB) No. 11197. This bill,
which is the substitute bill recommended by the House
Committee on Ways
739
VOL. 235, AUGUST 25, 1994 739

and Means in substitution of House Bills Nos. 253,

771, 2450, 7033, 8086,9030, 9210, 9397, 10012, and 14
10100, and covered by its Committee Report No. 367,
was approved on 15
third reading by the House16 on 17
November 1993. Interestingly, HB No. 9210, which
was filed by Representative Exequiel B. Javier on 19
May 1993, was certified by the President in his 17letter
to Speaker Jose de Venecia, Jr. of 1 June 1993. Yet,
HB No. 11197, which substituted HB No. 9210 and the
others abovestated, was not. Its certification seemed to
have been entirely forgotten.
On 18 November 1993, the Secretary-General of the
House, pursuant to Section 83, Rule XIV of the Rules
of the House, transmitted to the President of the
Senate HB No. 11197 18and requested the concurrence of
the Senate therewith.
However, HB No. 11197 had passed only its first
reading in the Senate by its referral to its Committee
on Ways and Means. That Committee never
deliberated on HB No. 11197 as it should
19
have. It acted
only on Senate Bill (SB) No. 1129 introduced by
Senator Ernesto F. Herrera on 1 March 1993. It then
prepared and proposed SB 20
No. 1630, and in its
Committee Report No. 349 which 21
was submitted to
the Senate on 7 February 1994, it recommended that
SB No. 1630 be approved “in substitution of S.B. No.
1129, taking into22consideration P.S. Res. No. 734 and
H.B. No. 11197.” It must be carefully noted that SB
No. 1630 was proposed and submitted for approval by
the Senate in SUBSTITUTION of SB No. 1129, and
not HB No. 11197. Obviously, the principal measure
which the Committee deliberated
________________
14 Consolidated Memorandum for Respondents, Annexes “2” to

“12,” inclusive.
15 Consolidated Memorandum for Respondents, 18.
16 Id., Annex “9.”
17 Id., Annex “1.”
18 Id., 18.
19 Id., Annex “15.” Entitled “An Act Restructuring the Value-
Added Tax (VAT) System By Expanding Its Tax Base, Amending
Sections 103, 113, 114 of the National Internal Revenue Code, as
Amended.”
20 Id., Annex “17.”
21 Id., 20.
22 Emphasis supplied.
740

on and acted upon was SB No. 1129 and not HB No.
11197. The latter, instead of being the only measure to
be taken up, deliberated upon, and reported back to
the Senate for its consideration on second reading and,
eventually, on third reading, was, at the most, merely
given by the Committee a passing glance.
This specific unequivocal action of the Senate
Committee on Ways and Means, i.e., proposing and
recommending approval of SB No. 1630 as a substitute
for or in substitution of SB No. 1129 demolishes at
once the thesis of the Solicitor General that:
“Assuming that SB 1630 is distinct from HB 11197,

amendment by substitution is within the purview of Section
24, Article VI of the Constitution.”
because, according to him, (a) “Section 68, Rule XXIX

of the Rules of the Senate authorizes an amendment by
substitution and the only condition required is that
‘the text thereof is submitted in writing’; and (b) ‘[I]n
Flint vs. Stone Tracy Co. (220 U.S. 107) the United
States Supreme Court, interpreting the provision in
the United States Constitution similar to Section 24,
Article VI of the Philippine Constitution, stated that
the power of the Senate to amend a revenue bill
includes substitution of an entirely new measure for
the one originally 23
proposed by the House of
Representatives.’ ”
This thesis is utterly without merit. In the first
place, it reads into the Committee Report something
which it had not contemplated, that is, to propose SB
No. 1630 in substitution of HB No. 11197; or
speculates that the Committee may have committed an
error in stating that it is SB No. 1129, and not HB No.
11197, which is to be substituted by SB No. 1630.
Either, of course, is unwarranted because the words of
the Report, solemnly signed by the Chairman, Vice-
Chairman (who dissented),
24
seven members, and three
ex-officio members, leave no room for doubt that
although SB No. 1129, P.S. Res No. 734, and HB No.
11197 were referred to and considered by the
Committee, it had prepared the attached SB No. 1630
which it recommends for approval “in
________________

24 Consolidated Memorandum for Respondents, Annex “17.” Two
signed with reservations and four signed subject to amendments.
741
VOL. 235, AUGUST 25, 1994 741

substitution of S.B. No. 11197, taking into

consideration P.S. No. 734 and H.B. No. 11197 with
Senators Herrera, Angara, Romulo, Sotto, Ople and
Shahani as authors.” To do as suggested would be to
substitute the judgment of the Committee with
another that is completely inconsistent with it, or,
simply, to capriciously ignore the facts.
In the second place, the Office of the Solicitor
General intentionally made it appear, to mislead
rather than25
to persuade us, that in Flint vs. Stone
Tracy Co. the U.S. Supreme Court ruled, as quoted
by it in the Consolidated 26
Memorandum for
Respondents, as follows:
“The Senate has the power to amend a revenue bill. This

power to amend is not confined to the elimination of
provisions contained in the original act, but embraces as well
the addition of such provisions thereto as may render the
original act satisfactory to the body which is called upon to
support it. It has, in fact, been held that the substitution of an
entirely new measure for the one originally proposed can be
supported as a valid amendment.
x x x x x x x x x
It is contended in the first place that this section of the act
is unconstitutional, because it is a revenue measure, and
originated in the Senate in violation of section 7 of article 1 of
the Constitution, providing that ‘all bills for raising revenue
shall originate in the House of Representatives, but the
Senate may propose or concur with the amendments, as on
other bills.’ ”
The first part is not a statement of the Court, but a

summary of the arguments of counsel in one of the
companion cases (No. 425, entitled, “Gay vs. Baltic
Mining Co.”). The second part is the second paragraph
of the opinion of the Court delivered by Mr. Justice
Day. The misrepresentation that the first part is a
statement of the Court is highly contemptuous. To
show such deliberate misrepresentation, it is well to
quote what actually are found in 55 L.Ed. 408, 410, to
wit:
“Messrs. Charles A. Snow and Joseph H. Knight filed a brief

for appellees in No. 425:
_______________
25 And companion cases, 220 U.S. 107, 55 L.Ed. 389 [1911].

26 Page 56.
742

x x x
The Senate has the power to amend a revenue bill. This
power to amend is not confined to the elimination of
provisions contained in the original act, but embraces as well
the addition of such provisions thereto as may render the
original act satisfactory to the body which is called upon to
support it. It has, in fact, been held that the substitution of
an entirely new measure for the one originally proposed can
be supported as a valid amendment.
Brake v. Collison, 122 Fed. 722.
Mr. James L. Quackenbush filed a statement for appellees
in No. 442.
Solicitor General Lehmann (by special leave) argued the
cause for the United States on reargument.
Mr. Justice Day delivered the opinion of the court:
These cases involve the constitutional validity of § 38 of the act of

Congress approved August 5, 1909, known as ‘the corporation tax’
law. 36 Stat. at L. 11, 112-117, chap. 6, U.S. Comp. Stat. Supp.
1909, pp. 659, 844-849.
It is contended in the first place that this section of the act is
unconstitutional, because it is a revenue measure, and originated in
the Senate in violation of § 7 of article 1 of the Constitution,
providing that ‘all bills for raising revenue shall originate in the
House of Representatives, but the Senate may propose or concur
with the amendments, as on other bills.’ The history of the act is
contained in the government’s brief, and is accepted as correct, no
objection being made to its accuracy.
This statement shows that the tariff bill of which the section
under consideration is a part, originated in the House of
Representatives, and was there a general bill for the collection of
revenue. As originally introduced, it contained a plan of inheritance
taxation. In the Senate the proposed tax was removed from the bill,
and the corporation tax, in a measure, substituted therefor. The bill
having properly originated in the House, we perceive no reason in
the constitutional provision relied upon why it may not be amended
in the Senate in the manner which it was in this case. The
amendment was germane to the subject-matter of the bill, and not
beyond the power of the Senate to propose.” (Emphasis supplied)
x x x
As shown above, the underlined portions were

deliberately omitted in the quotation made by the
Office of the Solicitor General.
743
VOL. 235, AUGUST 25, 1994 743

In the third place, a Senate amendment by
substitution with an entirely new bill of a bill, which
under Section 24, Article VI of the Constitution can
only originate exclusively in the House, is not
authorized by said Section 24. Flint vs. Stone Tracy Co.
cannot be invoked in favor of such a view. As pointed
out by Mr. Justice Florenz D. Regalado during the oral
arguments of these cases and during the initial
deliberations thereon by the Court, Flint involves a
Senate amendment to a revenue bill which, under the
United States Constitution, should originate from the
House of Representatives. The amendment consisted of
the substitution of a corporation tax in lieu of the plan
of inheritance taxation contained in a general bill for
the collection of revenue as it came from the House of
Representatives where the bill originated. The
constitutional provision in question is Section 7, Article
I of the United States Constitution which reads:
“Section 7. Bills and Resolutions.—All Bills for raising

Revenue shall originate in the House of Representatives; but
the Senate may propose or concur with Amendments, as on
other Bills.”
This provision, contrary to the misleading claim of the

Solicitor General, is not similar to Section 24, Article
VI of our Constitution, which for easy comparison is
hereunder quoted again:
“All appropriation, revenue or tariff bills, bills authorizing

increase of the public debt, bills of local application, and
private bills shall originate exclusively in the House of
Representatives, but the Senate may propose or concur with
amendments.”
Note that in the former the word exclusively does not

appear. And, in the latter, the phrase “as on other
Bills,” which is found in the former, does not appear.
These are very significant in determining the authority
of the upper chamber over the bills enumerated in
Section 24. Since the origination is not exclusively
vested in the House of Representatives of the United
States, the Senate’s authority to propose or concur
with amendments is necessarily broader. That broader
authority is further confirmed by the phrase “as on
other Bills,” i.e., its power to propose or concur with
amendments thereon is the same as in ordinary bills.
The absence of this phrase in our Constitution was
clearly intended to restrict or limit the Philippine
Senate’s power to
744

propose or concur with amendments. In the light of the

exclusivity of origination and the absence of the phrase
“as on other Bills,” the Philippine Senate cannot
amend by substitution with an entirely new bill of its
own any bill covered by Section 24 of Article VI which
the House of Representatives transmitted to it because
such substitution would indirectly violate Section 24.
These obvious substantive differences between
Section 7, Article I of the U.S. Constitution and Section
24, Article VI of our Constitution are enough reasons
why this Court should neither allow itself to be misled
by Flint27 vs. Stone nor be awed by Rainey vs. United 28
States and the opinion of Messrs. Ogg and Ray
which the majority cites to support the view that the
power of the U.S. Senate to amend a revenue measure
is unlimited. Rainey concerns the Tariff Act of 1909 of
the United States of America and specifically involved
was its Section 37 which was an amendment
introduced by the U.S. Senate. It was claimed by the
petitioners that the said section is a revenue measure
which should originate in the House of
Representatives. The U.S. Supreme Court, however,
adopted and approved the finding of the court a quo
that:
“the section in question is not void as a bill for raising
revenue originating in the Senate, and not in the House of
Representatives. It appears that the section was proposed by
the Senate as an amendment to a bill for raising revenue
which originated in the House. That is sufficient.”
Messrs. Ogg and Ray, who are professors emeritus of

political science, based their statement not even on a
case decided by the U.S. Supreme Court but on their
perception of what Section 7, Article I of the U.S.
Constitution permits. In the tenth edition (1951) of
their work, they state:
“Any bill may make its first appearance in either house,

except only that bills for raising revenue are required by the
constitution to ‘originate’ in the House of Representatives.
Indeed, through its right to amend revenue bills, even to the
extent of substituting new ones, the
________________
27 232 U.S. 309, 58 L ed. 117 [1914].

28 Introduction to American Government, 309, n. 2 [1945].
745
VOL. 235, AUGUST 25, 1994 745

29
Senate may, in effect, originate them also.”
Their “in effect” conclusion is, of course, logically

correct because the word exclusively does not appear in
said Section 7, Article I of the U.S. Constitution.
Neither can I find myself in agreement with the
view of the majority that the Constitution does not
prohibit the filing in the Senate of a substitute bill in
anticipation of its receipt of the bill from the House so
long as action by the Senate as a body is withheld
pending receipt of the House bill, thereby stating, in
effect, that S.B. No. 1129 was such an anticipatory
substitute bill, which, nevertheless, does not seem to
have been considered by the Senate except only after
its receipt of H.B. No. 11197 on 23 November 1993
when the process of legislation in respect of it began
with a referral to the Senate Committee on Ways and
Means. Firstly, to say that the Constitution does not
prohibit it is to render meaningless Section 24 of
Article VI or to sanction its blatant disregard through
the simple expedient of filing in the Senate of a so-
called anticipatory substitute bill. Secondly, it suggests
that S.B. No. 1129 was filed as an anticipatory
measure to substitute for H.B. No. 11197. This is a
speculation which even the author of S.B. No. 1129
may not have indulged in. S.B. No. 1129 was filed in
the Senate by Senator Herrera on 1 March 1993. H.B.
No. 11197 was approved by the House on third reading
only on 17 November 1993. Frankly, I cannot believe
that Senator Herrera was able to prophesy that the
House would pass any VAT bill, much less to know its
provisions. That “it does not seem that the Senate even
considered” the latter not until after its receipt of H.B.
No. 11197 is another speculation. As stated earlier,
S.B. No. 1129 was filed in the Senate on 1 March 1993,
while H.B. No. 11197 was transmitted to the Senate
only on 18 November 1993. There is no evidence on
record to show that both were referred to the Senate
Committee on Ways and Means at the same time.
Finally, in respect of H.B. No. 11197, its legislative
process did not begin with its referral to the Senate’s
Ways and Means Committee. It begin upon its filing,
as a Committee Bill of the House Committee on Ways
and Means, in the House.
_______________
29 At 317.
746

Second violation.—Since SB No. 1129 is a revenue

measure, it could not even be validly introduced or
initiated in the Senate. It follows too, that the Senate
cannot validly act thereon.
Third violation.—Since SB No. 1129 could not have
been validly introduced in the Senate and could not
have been validly acted on by the Senate, then it
cannot be substituted by another revenue measure, SB
No. 1630, which the Senate Committee on Ways and
Means introduced in substitution of SB No. 1129. The
filing or introduction in the Senate of SB No. 1630 also
violated Section 24, Article VI of the Constitution.
VIOLATIONS OF SECTION 26(2), ARTICLE VI

OF THE CONSTITUTION:
First violation.—The Senate, despite its lack of

constitutional authority to consider SB No. 1630 or SB
No. 1129 which the former substituted, opened
deliberations on second reading of SB No. 1630 on 8
February 1994. On 24 March 1994, the Senate 30
approved it on second reading and on third reading.
That approval on the same day violated Section 26(2),
Article VI of the Constitution. The justification
therefor was that on 24 February 1994 the President
certified to “the necessity of the enactment
31
of SB No.
1630 . . . to meet a public emergency.”
I submit, however, that the Presidential
certification is void ab initio not necessarily for the
reason adduced by petitioner Kilosbayan, Inc., but
because it was addressed to the Senate for a bill which
is prohibited from originating therein. The only bill
which could be properly certified on permissible
constitutional grounds even if it had already been
transmitted to the Senate is HB No. 11197. As earlier
observed, this was not so certified, although HB No.
9210 (one of those consolidated
32
into HB No. 11197) was
certified on 1 June 1993.
Also, the certification of SB No. 1630 cannot, by any
stretch of the imagination, be extended to HB No.
11197 because SB No. 1630 did not substitute HB No.
11197 but SB No. 1129.
_______________

31 Id., Annex “14.”
32 Id., Annex “1.”
747
VOL. 235, AUGUST 25, 1994 747

Considering that the certification of SB No. 1630 is

void, its approval on second and third readings in one
day violated Section 26(2), Article VI of the
Constitution.
Second violation.—It further appears that on 24
June 1994, after the approval of SB No. 1630, the
Secretary of the Senate, upon directive of the Senate
President, formally notified the House Speaker of the
Senate’s approval thereof and its request for a
bicameral conference “in view of the disagreeing 33
provisions of said bill and House Bill No. 11197.”
It must be stressed again that HB No. 11197 was
never submitted for or acted on second and third
readings in the Senate, and SB No. 1630 was never
sent to the House for its concurrence. Elsewise stated,
both were only half-way through the legislative mill.
Their submission to a conference committee was not
only anomalously premature, but violative of the
constitutional rule on three readings.
The suggestion that SB No. 1630 was not required
to be submitted to the House for otherwise the
procedure would be endless, is unacceptable for, firstly,
it violates Section 26, Rule XII of the Rules of the
Senate and Section 85, Rule XIV of the Rules of the
House, and, secondly, it is never endless. If the
chamber of origin refuses to accept the amendments of
the other chamber, the request for conference shall be
made.
VIOLATIONS OF THE RULES OF BOTH

CHAMBERS; GRAVE ABUSE OF DISCRETION.
The erroneous referral to the conference committee

needs further discussion. Since S.B. No. 1630 was not a
substitute bill for H.B. No. 11197 but for S.B. No. 1129,
it (S.B. No. 1630) remained a bill which originated in
the Senate. Even assuming arguendo that it could be
validly initiated in the Senate, it should have been first
transmitted to the House where it would undergo three
readings. On the other hand, since HB No. 11197 was
never acted upon by the Senate on second and third
readings, no differences or inconsistencies could as yet
arise so as to warrant a request for a conference. It
should be noted that under Section
_______________
33 Consolidated Memorandum for Respondents, Annex “18.”
748

83, Rule XIV of the Rules of the House, it is only when

the Senate shall have approved with amendments HB
No. 11197 and the House declines to accept the
amendments after having been notified thereof that
the request for a conference may be made by the
House, not by the Senate. Conversely, the Senate’s
request for a conference would only be proper if,
following the transmittal of SB No. 1630 to the House,
it was approved by the latter with amendments but the
Senate rejected the amendments.
Indisputably then, when the request for a bicameral
conference was made by the Senate, SB No. 1630 was
not yet transmitted to the House for consideration on
three readings and HB No. 11197 was still in the
Senate awaiting consideration on second and third
readings. Their referral to the bicameral conference
committee was palpably premature and, in so doing,
both the Senate and the House acted without authority
or with grave abuse of discretion. Nothing, and
absolutely nothing, could have been validly acted upon
by the bicameral conference committee.
GRAVE ABUSE OF DISCRETION COMMITTED

BY THE BICAMERAL CONFERENCE
COMMITTEE.
Serious irregularities amounting to lack of jurisdiction

or grave abuse of discretion were committed by the
bicameral conference committee.
First, it assumed, and took for granted that SB No.
1630 could validly originate in the Senate. This
assumption is erroneous.
Second, it assumed that HB No. 11197 and SB No.
1630 had properly passed both chambers of Congress
and were properly and regularly submitted to it. As
earlier discussed, the assumption is unfounded in fact.
Third, per the bicameral conference committee’s
proceedings of 19 April 1994, Representative Exequiel
Javier, Chairman of the panel from the House, initially
suggested that HB No. 11197 should be the “frame of
reference,” because it is a revenue measure, to which
Senator Ernesto Maceda concurred. However, after an
incompletely recorded reaction of Senator Ernesto
Herrera, Chairman of the Senate panel,
Representative Javier seemed to agree that “all
amendments will be coming from the Senate.” The
issue of what should be the “frame of reference” does
not appear to have been resolved. These facts are
recorded
749
VOL. 235, AUGUST 25, 1994 749

in this wise, as quoted 34in the Consolidated

Memorandum for Respondents:
Yes. That’s true for every revenue measure. There’s

no other way. The House Bill has got to be the base.
Of course, for the record, we know that this is an
administration; this is certified by the President and
I was about to put into the recordsas I am saying
now that your problem about the impact on prices on
the people was already decided when the President
and the administration sent this to us and certified
it. They have already gotten over that political
implication of this bill and the economic impact on
prices.
“CHAIRMAN JAVIER.
First of all, what would be the basis, no, or
framework para huwag naman mawala yung
personality namin dito sa bicameral, no, because the
bill originates from the House because this is a
revenue bill, so we would just want to ask, we make
the House Bill as the frame of reference, and then
everything will just be inserted?
HON. MACEDA.
CHAIRMAN HERRERA.
Yung concern mo about the bill as the reference in
this discussion is something that we can just . . .
CHAIRMAN JAVIER.
We will just . . . all the amendments will be coming
from the Senate.
(BICAMERAL CONFERENCE ON MAJOR
DIFFERENCES BETWEEN HB NO. 11197 AND SB
NO. 1630 [Cte. on Ways & Means] APRIL 19, 1994, II-
6 and II-7; italics supplied)”
These exchanges would suggest that Representative

Javier had wanted HB No. 11197 to be the principal
measure on which reconciliation of the differences
should be based. However, since the Senate did not act
on this Bill on second and third readings because its
Committee on Ways and Means did not deliberate on it
but instead proposed SB No. 1630 in substitution of SB
No. 1129, the suggestion has no factual basis. Then,
when finally he agreed that “all amendments will be
coming from the Senate,” he
_______________
34 Page 22.
750

in fact withdrew the former suggestion and agreed that

SB No. 1630, which is the Senate version of the Value
Added Tax (VAT) measure, should be the “frame of
reference.” But then SB No. 1630 was never
transmitted to the House for the latter’s concurrence.
Hence, it cannot serve as the “frame of reference” or as
the basis for deliberation. The posture taken by
Representative Javier also indicates that SB No. 1630
should be taken as the amendment to HB No. 11197.
This, too, is unfounded because SB No. 1630 was not
proposed in substitution of HB No. 11197.
Since SB No. 1630 did not pass three readings in
the House and HB No. 11197 did not pass second and
third readings in the Senate, it logically follows that no
disagreeing provisions had as yet arisen. The
bicameral conference committee erroneously assumed
the contrary.
Even granting arguendo that both HB No. 11197
and SB No. 1630 had been validly approved by both
chambers of Congress and validly referred to the
bicameral conference committee, the latter had very
limited authority thereon. It was created “in35
view of
the disagreeing provisions of” the two bills. Its duty
was limited to the reconciliation of disagreeing
provisions or the resolution of differences or
inconsistencies. The committee recognized that limited36
authority in the opening paragraph of its Report
when it said:
“The Conference Committee on the disagreeing provisions of

House Bill No. 11197 x x x and Senate Bill No. 1630 x x x.”
Under such limited authority, it could only either (a)

restore, wholly or partly, the specific provisions of HB
No. 11197 amended by SB No. 1630, (b) sustain, wholly
or partly, the Senate’s amendments, or (c) by way of a
compromise, to agree that neither provisions in HB No.
11197 amended by the Senate nor the latter’s
amendments thereto be carried into the final form of
the former.
But as pointed out by petitioners Senator Raul Roco
and Kilosbayan, Inc., the bicameral conference
committee not only
_______________
35 Consolidated Memorandum for Respondents, Annex “18.”

36 Id., Annex, “19.”
751
VOL. 235, AUGUST 25, 1994 751

struck out non-disagreeing provisions of HB No. 11197
and SB No. 1630, i.e., provisions where both bills are in
full agreement; it added more activities or transactions
to be covered by VAT, which were not within the
contemplation of both bills. Since both HB No. 11197
and SB No. 1630 were still half-cooked in the
legislative vat, and were not ready for referral to a
conference, the bicameral conference committee clearly
acted without jurisdiction or with grave abuse of
discretion when it consolidated both into one bill which
became R.A. No. 7716.
APPROVAL BY BOTH CHAMBERS OF

CONFERENCE COMMITTEE REPORT AND
PROPOSED BILL DID NOT CURE
CONSTITUTIONAL INFIRMITIES.
I cannot agree with the suggestion that since both the

Senate and the House had approved the bicameral
conference committee report and the bill proposed by it
in substitution of HB No. 11197 and SB No. 1630,
whatever infirmities may have been committed by it
were cured by ratification. This doctrine of ratification
may apply to minor procedural flaws or tolerable
breaches of the parameters of the bicameral conference
committee’s limited powers but never to violations of
the Constitution. Congress is not above the
Constitution. In the instant case, since SB No. 1630
was introduced in violation of Section 24, Article VI of
the Constitution, was passed in the Senate in violation
of the “three readings” rule, and was not transmitted
to the House for the completion of the constitutional
process of legislation, and HB No. 11197 was not
likewise passed by the Senate on second and third
readings, neither the Senate nor the House could
validly approve the bicameral conference committee
report and the proposed bill.
In view of the foregoing, the conclusion is inevitable
that for non-compliance with mandatory provisions of
the Constitution and of the Rules of the Senate and of
the House on the enactment of laws, R.A. No. 7716 is
unconstitutional and, therefore, null and void. A
discussion then of the intrinsic validity of some of its
provisions would be unnecessary.
The majority opinion, however, invokes the enrolled
bill doctrine and wants this Court to desist from
looking behind the copy of the assailed measure as
certified by the Senate President and the
752

Speaker of the House. I respectfully submit that the

invocation is misplaced. First, as to the issue of
origination, the certification in this case explicitly
states that R.A. No. 7716 is a “consolidation of House
Bill No. 11197 and Senate Bill No. 1630.” This is
conclusive evidence that the measure did not originate
exclusively in the House. Second, the enrolled bill
doctrine is of American origin, and unquestioned fealty
to it may no37 longer be justified in view of the expanded
jurisdiction of this Court under Section 1, Article VIII
of our Constitution which now expressly grants
authority to this Court to:
“determine whether or not there has been a grave abuse of

discretion amounting to lack or excess of jurisdiction on the
part of any branch or instrumentality of the Government.”
Third, even under the regime of the 1935 Constitution

which did not contain the above provision, this Court,
through 38Mr. Chief Justice Makalintal, in Astorga vs.
Villegas, declared that 39it cannot be truly said that
Mabanag vs. Lopez Vito has laid to rest the question
of whether the enrolled bill doctrine or the journal
entry rule should be adhered to in this jurisdiction,
and stated:
“As far as Congress itself is concerned, there is nothing
sacrosanct in the certification made by the presiding officers.
It is merely a mode of authentication. The lawmaking
process in Congress ends when the bill is approved by both
Houses, and the certification does not add to the validity of
the bill or cure any defect already present upon its passage.
In other words, it is the approval of Congress and not the
signatures of the presiding officers that is essential. Thus the
(1935) Constitution says that ‘[e]very bill passed by the
Congress shall, before it becomes law, be presented to the
President.’ In Brown vs. Morris, supra, the Supreme Court of
Missouri, interpreting a similar provision in the
_______________
37 ISAGANI A. CRUZ, Philippine Political Law, 1991 ed., 226; Daza vs.
Singson, 180 SCRA 496 [1989]; Coseteng vs. Mitra, 187 SCRA 377 [1990];
Gonzales vs. Macaraig, 191 SCRA 452 [1990]; Llamas vs. Orbos, 202 SCRA
844 [1991]; Bengzon vs. Senate Blue Ribbon Com- mittee, 203 SCRA 767
[1991]; Oposa vs. Factoran, 224 SCRA 792 [1993].
38 56 SCRA 714, 719, 723 [1974].
39 78 Phil. 1 [1947].
753
VOL. 235, AUGUST 25, 1994 753

State Constitution, said that the same ‘makes it clear that

the indispensable step in the passage’ and it follows that if a
bill, otherwise fully enacted as a law, is not attested by the
presiding officer, other proof that it has ‘passed both houses
will satisfy the constitutional requirement.’ ”
Fourth, even in the United States, the enrolled bill

doctrine has been substantially undercut. This is
shown in the disquisitions of Mr. Justice Reynato S.
Puno in his dissenting opinion, citing Sutherland,
Statutory Construction.
Last, the pleadings of the parties have established
beyond doubt that HB No. 11197 was not acted on
second and third readings in the Senate and SB No.
1630, which was approved by the Senate on second and
third readings in substitution of SB No. 1129, was
never transmitted to the House for its passage.
Otherwise stated, they were only passed in their
respective chamber of origin but not in the other. In no
way can each become a law under paragraph 2, Section
26, Article VI of the Constitution. For the Court to
close its eyes to this fact because of the enrolled bill
doctrine is to shirk its duty 40to hold “inviolate what is
decreed by the Constitution.”
I vote then to GRANT these petitions and to declare
R.A. No. 7716 as unconstitutional.
DISSENTING OPINION
ROMERO, J.:
Few issues brought before this Court for resolution

have roiled the citizenry as much as the instant case
brought by nine petitioners which challenges the
constitutionality of Republic Act No. 7716 (to be
referred to herein as the “Expanded Value Added Tax”
or EVAT law to distinguish it from Executive Order
No. 273 which is the VAT law proper) that was enacted
on May 5, 1994. A visceral issue, it has galvanized the
populace into mass action and strident protest even as
the EVAT proponents have taken to podia and media
in a post facto information campaign.
________________
40 Mutuc vs. COMELEC, 36 SCRA 228 [1970].
754

The Court is confronted here with an atypical case. Not

only is it a vatful of seething controversy but some
unlikely petitioners invoke unorthodox remedies.
Three Senator-petitioners would nullify a statute that
bore the indispensable stamp of approval of their own
Chamber with two of them publicly repudiating what
they had earlier endorsed. With two former colleagues,
one of them an erstwhile Senate President, making
common cause with them, they would stay the
implementation by the Executive Department of a law
which they themselves have initiated. They address a
prayer to a co-equal Department to probe their official
acts for any procedural irregularities they have
themselves committed lest the effects of these
aberrations inflict such damage or irreparable loss as
would bring down the wrath of the people on their
heads.
To the extent that they perceive that a vital cog in
the internal machinery of the Legislature has
malfunctioned from having operated in blatant
violation of the enabling Rules they have themselves
laid down, they would now plead that this other
Branch of Government step in, invoking the exercise of
what is at once a delicate and awesome power.
Undoubtedly, the case at bench is as much a test for
the Legislature as it is for the Judiciary.
A backward glance on the Value Added Tax (VAT) is
in order at this point.
The first codification of the country’s internal
revenue laws was effected with the enactment of
Commonwealth Act No. 466, commonly known as the
‘National Internal Revenue Code’ which was approved
on June 15, 1939 and took effect on July 1, 1939,
although the provisions on the income tax were made
retroactive to January 1, 1939.
“Since 1939 when the turnover tax was replaced by
the manufacturer’s sales tax, the Tax Code had
provided for a single-stage value-added tax on original
sales by manufacturers, producers and importers
computed on the ‘cost deduction method’ and later, on
the basis of the ‘tax credit method.’ The turnover tax
was re-introduced in 1985 by Presidential Decree No.1
1991 (as amended by Presidential Decree No. 2006).”
_______________
1 Vitug, Jose C., COMPENDIUM OF TAX LAW AND

JURISPRUDENCE, Third Revised Edition, 1993 at 201.
755
VOL. 235, AUGUST 25, 1994 755

In 1986, a tax reform package was approved by the

Aquino Cabinet. It contained twenty-nine measures,
one of which proposed the adoption of the VAT, as well
as the simplification of the sales tax structure and the
abolition of the turnover tax.
“Up until 1987, the system of taxing goods consisted
of (a) an excise tax on certain selected articles (b) fixed
and percentage taxes on original and subsequent sales,
on importations and on milled articles and (c) mining
taxes on mineral products. Services were subjected 2
to
percentage taxes based mainly on gross receipts.”
On July 25, 1987, President Corazon C. Aquino
signed into law Executive Order No. 273 which
adopted the VAT. From the former single-stage value-
added tax, it introduced the multi-stage VAT system
where “the value-added tax is imposed on the sale of
and distribution process culminating in sale, to the
final consumer. Generally described, the taxpayer (the
seller) determines his tax liability by computing the
tax on the gross selling price or gross receipt (“output
tax”) and subtracting or crediting the earlier VAT on
the purchase or importation of goods or on the sale of
service
3
(“input tax”) against the tax due on his own
sale.”
On January 1, 1988, implementing rules and
regulations for the VAT were promulgated. President
Aquino then issued Proclamation No. 219 on February
12, 1988 urging the public and private sectors to join
the nationwide consumers’ education campaign for
VAT.
Soon after the implementation of Executive Order
No. 273, its constitutionality was assailed before this
Court in the case of Kapatiran ng mga Naglilingkod
4
sa
Pamahalaan ng Pilipinas, Inc., et al. v. Tan. The four
petitioners sought to nullify the VAT law “for being
unconstitutional in that its enactment is not allegedly
within the powers of the President; that the VAT is
oppressive, discriminatory, regressive, and violates the
due process and equal protection clauses and other
provisions of the 1987
_______________
2 Ibid.
3 Ibid.
4 L-81311, June 30, 1988, 163 SCRA 371 with Justice Teodoro R.
Padilla as ponente.
756

5
Constitution.” In dismissing the consolidated
petitions, this Court stated:
“The Court, following the time-honored doctrine of separation

of powers cannot substitute its judgment for that of the
President as to the wisdom, justice and advisability of the
VAT. The Court can only look into and determine whether or
not Executive Order No. 273 was enacted and made effective
as law, in the manner required by and consistent with, the
Constitution, and to make sure that it was not issued in
grave abuse of discretion amounting to lack or excess of
jurisdiction; and, in this regard, the Court finds no reason
6
to
impede its application or continued implementation.”
Although declared constitutional, the VAT law was

sought to be amended from 1992 on by a series of bills
filed in both Houses of Congress. In chronological
sequence, these were:
HB/SB No. Date Filed in Congress

HB No. 253 — July 22, 1992
HB No. 771 — August 10, 1992
HB No. 2450 — September 9, 1992
7
Senate Res. No. 734 — September 10, 1992
HB No. 7033 — February 3, 1993
8
SB No. 1129 — March 1, 1993
HB No. 8086 — March 9, 1993
HB No. 9030 — May 11, 1993
_______________
5 Ibid at 378.
6 Ibid at 385.
7 Senate Resolution No. 734 filed on September 10, 1992 was
entitled “Resolution Urging the House Committee on Ways and
Means to Study the Proposal to Exempt Local Movie Producers from
the Payment of the Value-Added Tax as an Incentive to the
Production of Quality and Wholesome Filipino Movies, Whenever
They Feature an All-Filipino Cast of Actors and Actresses.”
8 SB No. 1129 sought to include under the VAT Law such items as
lease of real properties, excluding agricultural lands and residential
properties with monthly rentals of less than P10,000.00; hotels;
restaurants, eating places, caterers; services by persons in the
exercise of their professions; actors, actresses, talents, singers and
professional athletes; and lawyers, accountants, doctors and other
professionals registered with the Philippine Regulatory Commission.
757
VOL. 235, AUGUST 25, 1994 757
9
HB No. 9210 — May 19,
1993
HB No. 9297 — May 25,
1993
HB No. 10012 — July 28,
1993
HB No. 10100 — August 3,
1993
HB No. 11197 in substitution of HB — November
Nos. 253, 771, 2450, 7033, 8086,
10
9030, 5, 1993
9210, 9297, 10012 and 10100
We now trace the course taken by H.B. No. 11197 and

S.B. No. 1129.
HB/SB No.
HB No. 11197 was approved in the — November
Lower House on second reading 11, 1993
HB No. 11197 was approved in the — November
Lower House on third reading and 17, 1993
voted upon with 114 Yeas and 12 Nays —
November
18, 1993
HB No. 11197 was transmitted to the — February
Senate Senate Committee on Ways and 7, 1994
Means submitted Com. Report No. 349
recommending for approval SB No.
1630 in substitution of SB No. 1129,
taking into consideration
11
PS Res. No.
734 and HB No. 11197
_______________
9 On June 1, 1993, President Fidel V. Ramos certified for

immediate enactment House Bill No. 9210 entitled “An Act
Amending Title IV and Sections 237 and 238 of the National Internal
Revenue Code, as amended, to meet a public emergency.”
10 House Bill No. 11197 is entitled “An Act Restructuring the
Value-Added Tax (VAT) System to Widen its Tax Base and Enhance
Its Administration, Amending for these Purposes Sections 99, 100,
102, 103, 104, 105, 106, 107, 108 and 110 of Title IV, 112, 115 and
116 of Title V, and 236, 237, and 238 of Title IX and Repealing
Sections 113 and 114 of Title V, all of the National Internal Revenue
Code, as Amended.”
11 Senate Bill No. 1630 is entitled “An Act Restructuring The
Value-Added Tax (VAT) System to Widen its Tax Base and Enhance
Its Administration, Amending for these Purposes Sections 99, 100,
102, 103, 104, 105, 107, 108 and 110 of Title IV, 112 of Title V, and
236, 237 and 238 of Title IX, and Repealing Sections 113, 114 and
116 of Title V, all of the National Internal Revenue Code, as
Amended, and for other Purposes.”
758

Certification by President Fidel V. Ramos — March

of Senate Bill No. 1630 for immediate 22,
enactment to meet a public emergency 1994
SB No. 1630 was approved by the Senate on — March
second and third readings and 24,
subsequently voted upon with 13 yeas, none 1994
against and one abstention
Transmittal by the Senate to the Lower — March
House of a request for a conference in view 24,
of disagreeing provisions of SB No. 1630 1994
and HB No. 11197
The Bicameral Conference Committee — April
conducted various meetings to reconcile the 13,
proposals on the VAT 19,
20,
21, 25
The House agreed on the Conference — April
Committee Report 27,
1994
The Senate agreed on the Conference — May
Committee Report 2,
1994
The President signed Republic
12
Act No. 7716 — May
—The Expanded VAT Law 5,
1994
Republic Act No. 7716 was published in two — May
newspapers of general circulation 12,
1994
Republic Act No. 7716 became effective — May
28,
1994
Republic Act No. 7716 merely expanded the base of the

VAT law even as the tax retained its multi-stage
character.
At the oral hearing held on July 7, 1994, this Court
delimited petitioners’ arguments to the following
issues culled from their respective petitions.
PROCEDURAL ISSUES
Does Republic Act No. 137716 violate Article VI, Section
24, of the Constitution?
________________
12 Republic Act No. 7716 is entitled “An Act Restructuring The

Value-Added Tax (VAT) System, Widening Its Tax Base And
Enhancing Its Administration, And For These Purposes Amending
And Repealing The Relevant Provisions Of The National Internal
Revenue Code, as amended, and for other purposes.”
13 Article VI, Section 24: “All appropriation, revenue or tariff bills
authorizing increase of the public debt, bills of local application, and
759
VOL. 235, AUGUST 25, 1994 759

Does it violate Article

14
VI, Section 26, paragraph 2, of
the Constitution?
What is the extent of the power of the Bicameral
Conference Committee?
SUBSTANTIVE ISSUES
Does the law violate the following provisions in Article
III (Bill of Rights) of the Constitution:
15
1. Section 1
16
2. Section 4
17
3. Section 5
18
4. Section 10
_______________
private bills shall originate exclusively in the House of

amendments.”
14 Article VI, Section 26, paragraph 2: “No bill passed by either
House shall become a law unless it has passed three readings on
separate days, and printed copies thereof in its final form have been
distributed to its Members three days before its passage, except
when the president certifies to the necessity of its immediate
enactment to meet a public calamity or emergency. Upon the last
reading of a bill, no amendment thereto shall be allowed, and the
vote thereon shall be taken immediately thereafter, and the yeas and
nays entered in the Journal.”
15 Article III, Section 1: “No person shall be deprived of life,
liberty, or property without due process of law, nor shall any person
be denied the equal protection of the laws.”
16 Article III, Section 4: “No law shall be passed abridging the
freedom of speech, of expression, or of the press, or the right of the
people peaceably to assemble and petition the government for
redress of grievances.”
17 Article III, Section 5: “No law shall be made respecting an
establishment of religion, or prohibiting the free exercise and
enjoyment of religious profession and worship, without
discrimination or preference, shall forever be allowed. No religious
test shall be required for the exercise of civil or political rights.”
18 Article III, Section 10: “No law impairing the obligation of
contracts shall be passed.”
760

Does the law violate the following other provisions of

the Constitution?
19
1. Article VI, Section 28, paragraph 1
20
2. Article VI, Section 28, paragraph 3
As a result of the unedifying experience of the past

where the Court had the propensity to steer clear of
questions it perceived to be “political” in nature, the
present Constitution, in contrast, has explicitly
expanded judicial power to include the duty of the
courts, especially the Supreme Court, “to determine
whether or not there has been a grave abuse of
discretion amounting to lack or excess of jurisdiction
on the part of 21
any branch or instrumentality of the
Government.” I submit that under this explicit
mandate, the Court is empowered to rule upon acts of
other Government entities for the purpose of
determining whether there may have been, in fact,
irregularities committed tantamount to violation of the
Constitution, which case would clearly constitute a
grave abuse of discretion on their part.
In the words of the sponsor of the above-quoted
Article of the Constitution on the Judiciary, the former
Chief Justice Roberto R. Concepcion, “the judiciary is
the final arbiter on the question of whether or not a
branch of government or any of its officials has acted
without jurisdiction or in excess of jurisdiction, or so
capriciously as to constitute an abuse of discretion
amounting to excess of jurisdiction or lack of
jurisdiction. This is not only a judicial power but a
duty to pass judgment on matters of this nature.
This is the background of paragraph 2 of Section 1,
which means that the courts cannot hereafter exhibit
its wonted reticence
_______________
19 Article VI, Section 28, paragraph 1: “The rule of taxation shall

be uniform and equitable. The Congress shall evolve a progressive
system of taxation.”
20 Article VI, Section 28, paragraph 3: “Charitable institutions,
churches and parsonages or convents appurtenant thereto, mosques,
non-profit cemeteries, and all lands, buildings, and improvements,
actually, directly, and exclusively used for religious, charitable, or
educational purposes shall be exempt from taxation.”
21 Constitution, Article VIII, Section 1.
761
VOL. 235, AUGUST 25, 1994 761

by claiming22
that such matters constitute a political
question.”
In the instant petitions, this Court is called upon,
not so much to exercise its traditional power of judicial
review as to determine whether or not there has
indeed been a grave abuse of discretion on the part of
the Legislature amounting to lack or excess of
jurisdiction.
Where there are grounds to resolve a case without
touching on its constitutionality, the Court will do so
with utmost alacrity in due deference to the doctrine of
separation of powers anchored on the respect that
must be accorded to the other branches of government
which are coordinate, coequal and, as far as
practicable, independent of one another.
Once it is palpable that the constitutional issue is
unavoidable, then it is time to assume jurisdiction,
provided that the following requisites for a judicial
inquiry are met: that there must be an actual and
appropriate case; a personal and substantial interest of
the party raising the constitutional question; the
constitutional question must be raised at the earliest
possible opportunity and the decision of the
constitutional question must be necessary to the
determination of23the case itself, the same being the lis
mota of the case.
Having assured ourselves that the above-cited
requisites are present in the instant petitions, we
proceed to take them up.
ARTICLE VI, SECTION 24

Some petitioners assail the constitutionality of
Republic Act No. 7716 as being in violation of Article
VI, Section 24 of the Constitution which provides:
“All appropriation, revenue or tariff bills, bills authorizing

increase of the public debt, bills of local application, and
private bills, shall originate exclusively in the House of
amendments.”
_______________
22 Volume One, CONCOM RECORD, p. 436.

23 Luz Farms v. The Hon. Secretary of the Department of
Agrarian Reform, G.R. No. 86889, December 4, 1990, 192 SCRA 51;
Dumlao, et al. v. Commission on Elections, G.R. No. 52245, January
22, 1980, 95 SCRA 392; People v. Vera, 65 Phil. 56 (1937).
762

In G.R. Nos. 115455 and 115781, petitioners argue:

(a) The bill which became Republic Act No. 7716
did not originate exclusively in the House of
Representatives. The Senate, after receiving
H.B. No. 11197, submitted its own bill, S.B. No.
1630, and proceeded to vote and approve the
same after second and third readings.
(b) The Senate exceeded its authority to “propose
or concur with amendments” when it submitted
its own bill, S.B. No. 1630, recommending its
approval “in substitution of S.B. No. 1129,
taking into consideration P.S. Res. No. 734 and
H.B. No. 11197.”
(c) H.B. No. 11197 was not deliberated upon by the
Senate. Neither was it voted upon by the
Senate on second and third readings, as what
was voted upon was S.B. No. 1630.
Article VI, Section 24 is taken word for word from

Article VI, Section 18 of the 1935 Constitution which
was, in turn, patterned after Article I, Section 7 (1) of
the Constitution of the United States, which states:
“All bills for raising revenue shall originate in the House of

amendments as on other bills.”
The historical precedent for requiring revenue bills to

originate in Congress
24
is explained in the U.S. case of
Morgan v. Murray:
“The constitutional requirement that all bills for raising

revenue shall originate in the House of Representatives
stemmed from a remedial outgrowth of the historic conflict
between Parliament (i.e., Commons) and the Crown, whose
ability to dominate the monarchially appointive and
hereditary Lords was patent. See 1 Story, Constitution, S 875
et seq., 5th Ed.; 1 Cooley, Constitutional Limitations, pp.
267, 268, 8th Ed., 1 Sutherland, Statutory Construction, S
806, 3d Ed. There was a measure of like justification for the
insertion of the provision of articles I, S 7, cl. 1, of the
Federal Constitution. At that time (1787) and thereafter
until the adoption (in 1913) of the Seventeenth Amendment
providing for the direct election of senators, the members of
the United States Senate were elected for each state by the
joint vote of both houses of the Legislature of the respective
states, and hence, were removed from the people. x x x”
________________
24 328 P. 2d 644 (1958).
763
VOL. 235, AUGUST 25, 1994 763

The legislative authority under the 1935 Constitution

being unicameral, in the form of the National
Assembly, it served no purpose to include the subject
provision in the draft submitted by the 1934
Constitutional Convention to the Filipino people for
ratification.
In 1940, however, the Constitution was amended to
establish a bicameral Congress of the Philippines
composed of a House of Representatives and a Senate.
In the wake of the creation of a new legislative
machinery, new provisions were enacted regarding the
law-making power of Congress. The National Assembly
explained how the final formulation of the subject
provision came about:
“The concurrence of both houses would be necessary to the

enactment of a law. However, all appropriation, revenue or
tariff bills, bills authorizing an increase of the public debt,
bills of local application, and private bills, should originate
exclusively in the House of Representatives, although the
Senate could propose or concur with amendments.
In one of the first drafts of the amendments, it was
proposed to give both houses equal powers in lawmaking.
There was, however, much opposition on the part of several
members of the Assembly. In another draft, the following
provision, more restrictive than the present provision in the
amendment, was proposed and for sometime was seriously
considered:
‘All bills appropriating public funds, revenue or tariff bills, bills of

local application, and private bills shall originate exclusively in the
Assembly, but the Senate may propose or concur with amendments.
In case of disapproval by the Senate of any such bills, the Assembly
may repass the same by a two-thirds vote of all its members, and
thereupon, the bill so repassed shall be deemed enacted and may be
submitted to the President for corresponding action. In the event
that the Senate should fail to finally act on any such bills, the
Assembly may, after thirty days from the opening of the next
regular sessions of the same legislative term, reapprove the same
with a vote of two-thirds of all the members of the Assembly. And
upon such reapproval, the bill shall be deemed enacted and may be
submitted to the president for corresponding action.’
However, the special committee voted finally to report the

present amending provision as it is now worded; and in that
form it was approved by the National Assembly with the
approval of Resolution No.
764

25
38 and later of Resolution No. 73.” (Italics supplied)
Thus, the present Constitution is identically worded as

its 1935 precursor: “All appropriation, revenue or tariff
bills, bills authorizing increase of the public debt, bills
of local application, and private bills, shall originate
exclusively in the House of Representatives, but the
Senate may propose or concur with amendments.”
(Italics supplied)
That all revenue bills, such as Republic Act No.
7716, should “originate exclusively in the House of
Representatives” logically flows from the more
representative and broadly-based character of this
Chamber.
“It is said that the House of Representatives being
the more popular branch of the legislature, being closer
to the people, and having more frequent contacts with
them than the Senate, should have the privilege of
taking the initiative in the proposals of revenue and
tax projects, the disposal of the people’s money, and
the contracting of public indebtedness.
These powers of initiative in the raising and
spending of public funds enable the House of
Representatives not only to implement but even to
determine the fiscal policies of the government. They
place on its shoulders much of the responsibility of
solving the financial problems of the government,
which are so closely related to the economic life of the
country, and of deciding on the proper distribution of
revenues for
26
such uses as may best advance public
interests.”
The popular nature of the Lower House has been
more pronounced with the inclusion of Presidentially-
appointed sectoral representatives, as provided in
Article VI, Section 5(2), of the Constitution, thus: “The
party-list representatives shall constitute twenty per
centum of the total number of representatives
including those under the party list. For three
consecutive terms after the ratification of this
Constitution, one-half of the seats allocated to party-list
representatives shall be filled, as provided by law, by
________________
25 Aruego, Jose M., PHILIPPINE POLITICAL LAW, KNOW

YOUR CONSTITUTION, University Publishing Co., 1950, pp. 65-66.
26 Sinco, Vicente G., PHILIPPINE POLITICAL LAW, Eleventh
Edition, p. 196.
765
VOL. 235, AUGUST 25, 1994 765

selection or election from the labor, peasant, urban

poor, indigenous cultural communities, women, youth,
and such other sectors as may be provided by law,
except the religious sector.” (Italics supplied)
This novel provision which was implemented in the
27
Batasang Pambansa during the martial law regime
was eventually incorporated in the present
Constitution in order to give those from
_______________
27 Remarks of Commissioner Eulogio Lerum: “At a time when we

did not have a lawmaking body after martial law was declared, there
were tripartite conferences called by the President for the purpose of
acting as a recommendatory body regarding settlement of labor and
management disputes. During the said conferences, labor had shown
that it can act with maturity. As a result, in 1976, an amendment
was introduced in the Constitution providing for sectoral
representation. In the Constitution that was approved, the number
of sectors was not indicated. However, in the Election Code of 1978,
it provided for three sectors; namely, industrial labor, agricultural
labor and the youth. The agricultural labor was given four seats; two
for Luzon, one for the Visayas and one for Mindanao. The same is
true with the industrial labor sector. As far as the youth are
concerned, they were also given four seats: two for Luzon, one for
Mindanao and one for the Visayas, with the condition that there will
be an additional two at large. And so, the youth had six
representatives plus four from the agricultural labor sector and four
from the industrial labor sector—we had 14 seats.
In 1981, the Constitution was again amended. In the course of the
amendment, the labor representatives in the Batasang Pambansa
proposed that sectoral representation be included as a permanent
addition to the lawmaking body.
Again, in that Constitution which was approved in 1981, the
number and the name of the sectors were not indicated. However, in
the Election Code that was approved before the 1984 election, there
was really a definition of who will constitute the sectors and how
they will be appointed. Let me quote from that law that was passed
in 1984. Under Section 27 of Batas Pambansa Blg. 881, the scope of
the sectors has been defined as follows:
The agricultural labor sector covers all persons who personally
and physically till the land as their principal occupation. It includes
agricultural tenants and lessees, rural workers and farm employees,
owner-cultivators, settlers and small fishermen.
The industrial labor sector includes all nonagricultural workers
and employees.
766

the marginalized and often deprived sector, an

opportunity to have their voices heard in the halls of
the Legislature, thus giving substance and meaning to
the concept of “people empowerment.”
That the Congressmen indeed have access to, and
consult their constituencies has been demonstrated
often enough by the fact that even after a House bill
has been transmitted to the Senate for concurrence,
some Congressmen have been known to express their
desire to change their earlier official position or reverse
themselves after having heard their constituents’
adverse reactions to their representations.
In trying to determine whether the mandate of the
Constitution with regard to the initiation of revenue
bills has been preserved inviolate, we have recourse to
the tried and tested method of definition of terms. The
term “originate” is defined by Webster’s New
International Dictionary (3rd Edition, 1986) as follows:
“v.i., to come into being; begin; to start.”
On the other hand, the word “exclusively” is defined
by the same Webster’s Dictionary as “in an exclusive
manner; to the exclusion of all others; only; as, it is his,
exclusively.” Black’s Law Dictionary has this
definition: “apart from all others; only; solely;
substantially all or for the greater part. To the
exclusion of all others; without admission of others to
participation; in a manner to exclude. Standard Oil Co.
of Texas v. State, Tex. Civ. App., 142 S.W. 2d 519, 521,
522, 523.”
This Court had occasion to define the term
“exclusive” as follows:
“. . . In its usual and generally accepted sense, the term

means possessed to the exclusion of others; appertaining to
the subject alone; not including, admitting
28
or pertaining to
another or others; undivided, sole.”
When this writer, during the oral argument of July 7,

1994, asked the petitioner in G.R. No. 115455 whether
he considers the
________________
The youth sector embraces persons not more than twenty-five

years of age.” (Volume Two, CONCOM RECORD, p. 564).
28 City Mayor, et al. v. The Chief, Philippine Constabulary and
Col. Nicanor Garcia, L-20346, October 31, 1967, 21 SCRA 673.
767
VOL. 235, AUGUST 25, 1994 767

word “exclusively” to be synonymous

29
with “solely,” he
replied in the affirmative.
A careful examination of the legislative history
traced earlier in this decision shows that the original
VAT law, Executive Order No. 273, was sought to be
amended by ten House bills which finally culminated
in House Bill No. 11197, as well as two Senate bills. It
is to be noted that the first House Bill No. 253 was
filed on July 22, 1992, and two other House bills
followed in quick succession on August 10 and
September 9, 1992 before a Senate Resolution, namely,
Senate Res. No. 734, was filed on September 10, 1992
and much later, a Senate Bill proper, viz., Senate Bill
No. 1129 on March 1, 1993. Undoubtedly, therefore,
these bills originated or had their start in the House
and before any Senate bill amending the VAT law was
filed. In point of time and venue, the conclusion is
ineluctable that Republic Act No. 7716, which is
indisputably a revenue measure, originated in the
House of Representatives in the form of House Bill No.
253, the first EVAT bill.
Additionally, the content and substance of the ten
amendatory House Bills filed over the roughly one-year
period from July 1992 to August 1993 reenforce the
position that these revenue bills, pertaining as they do,
to Executive Order No. 273, the prevailing VAT law,
originated in the Lower House.
________________
29 Transcript of the Stenographic Notes (TSN) on the Hearing Had

on Thursday, July 7, 1994, pp. 18-19: JUSTICE FLERIDA RUTH P.
ROMERO:
Q—Mr. Counsel, may I interrupt at this stage?
When you say that according to the Constitution such Revenue Bills
should originate exclusively from the House. In this instance, did it not
originally originate exclusively from the House?
The word used was not “solely”; if there were Bills later also
introduced, let us say in the Senate, but the House Bill came ahead.
So, are you using the two (2) words originate “exclusively” and “solely”
synonymously?
SENATOR TOLENTINO:
A—The verb “originate” remains the same, Your Honor, but the word
“exclusively,” as I said, means “solely.” x x x
768

House Bill Nos. 253, 771, 2450, 7033, 8086, 9030, 9210,
9297, 10012 and 10100 were intended to restructure
the VAT system by exempting or imposing the tax on
certain items or otherwise introducing
30
reforms in the
mechanics of implementation. Of these, House Bill
No. 9210 was favored with a Presidential certification
on the need for its immediate enactment to meet a
public emergency. Easily the most comprehensive, it
noted that the revenue performance of the VAT, being
far from satisfactory since the collections have always
fallen short of projections, “the system is rendered
inefficient, inequitable and less comprehensive.”
Hence, the Bill proposed several amendments designed
to widen the tax31
base of the VAT and enhance its
administration.
That House Bill No. 11197 being a revenue bill,
originated from the Lower House was acknowledged,
in fact was virtually taken for granted, by the
Chairmen of the Committee on Ways and Means of
both the House of Representatives and the Senate.
Consequently, at the April 19, 1994 meeting of the
Bicameral Conference Committee, the Members agreed
to make the House Bill as the “frame of reference” or
“base” of the discussions of the Bicameral Conference
Committee with the “amendments”
32
or “insertions to
emanate from the Senate.”
________________
30 H.B. 771—exempting the sale of copra from VAT coverage; H.B.

2450—exempting the lessors or distributors of cinematographic films
from paying the VAT; H.B. 7033—amending Sec. 103 of the National
Internal Revenue Code, as amended by EO 273; H.B. 8086—
exempting packaging materials of export products from the VAT;
H.B. 9030—amending Sec. 120 of the NIRC, as renumbered by EO
273; H.B. 9210—amending Title IV and Sections 237 and 238 of the
NIRC; H.B. 9297—restructuring the VAT system by expanding its
tax base, and amending Sections 99, 100 (A), 102 (A), 103, 113, 114,
115 and 116 of the NIRC; H.B. 10012—reducing the rate of VAT
imposed on sale and importation of goods, and sale of services; H.B.
10100—amending certain provisions of the NIRC on VAT.
31 Explanatory Note of House Bill No. 9210.
32 Excerpts from the April 19, 1994 meeting of the Bicameral
Conference Committee: “CHAIRMAN Javier. First of all, what would
be the basis, no, or framework para huwag naman mawala yung
personality namin dito sa bicameral, no, because the bill originates
from the House because this is a revenue bill, so we would just want
to ask, we make the House Bill as the frame of reference, and then
769
VOL. 235, AUGUST 25, 1994 769

As to whether the bills originated exclusively in the

Lower House is altogether a different matter.
Obviously, bills amendatory of VAT did not originate
solely in the House to the exclusion of all others for
there were P.S. Res. No. 734 filed in the Senate on
September 10, 1992 followed by Senate Bill No. 1129
which was filed on March 1, 1993. About a year later,
this was substituted by Senate Bill No. 1630 that
eventually became the EVAT law, namely, Republic
Act No. 7716.
Adverting to the passage of the amendatory VAT
bills in the Lower House, it is to be noted that House
Bill No. 11197 which substituted all the prior bills
introduced in said House complied with the required
readings, that is, the first reading consisting of the
reading of the title and referral to the appropriate
Committee, approval on second reading on November
11, 1993 and on third reading on November 17, 1993
before being finally transmitted to the Senate. In the
Senate, its identity was preserved and its provisions
were taken into consideration when the Senate
Committee on Ways and Means submitted Com.
Report No. 349 which recommended for approval “S.B.
No 1630 in substitution of S.B. No. 1129, taking into
consideration P.S. Res. No. 734 and H.B. No. 11197.”
At this stage, the subject bill may be considered to
have passed first reading in the Senate with the
submission of said Committee Report No. 349 by the
Senate Committee on Ways and Means to which it had
been referred earlier. What
_______________
everything will just be inserted?
“HON. MACEDA. Yes, That’s true for every revenue measure.

There’s no other way. The House Bill has got to be the base. Of
course, for the record, we know that this is an administration bill;
this is certified by the president and I was about to put into the
records as I am saying now that your problem about the impact on
prices on the people was already decided when the President and
the administration sent this to us and certified it. They have
already gotten over that political implication of this bill and the
economic impact on prices.
“CHAIRMAN HERRERA. Yung concern mo about the bill as
the reference in this discussion is something that we can just. . . .
“CHAIRMAN JAVIER. We will just . . . all the amendments
will be coming from the Senate.”
770

remained, therefore, was no longer House Bill No.

11197 but Senate Bill No. 1630. Thence, the Senate,
instead of transmitting the bill to the Lower House for
its concurrence and amendments, if any, took a
“shortcut,” bypassed the Lower House and instead,
approved Senate Bill No. 1630 on both second and
third readings on the same day, March 24, 1994.
The first irregularity, that is, the failure to return
Senate Bill No. 1630 to the Lower House for its
approval is fatal inasmuch as the other chamber of
legislature was not afforded the opportunity to
deliberate and make known its views. It is no idle
dictum that no less than the Constitution ordains:
“The legislative power shall be vested in the Congress
of the Philippines which shall
33
consist of a Senate and a
House of Representatives ...” (Italics supplied)
It is to be pointed out too, that inasmuch as Senate
Bill No. 1630 which had “taken into consideration”
House Bill No. 11197 was not returned to the Lower
House for deliberation, the latter Chamber had no
opportunity at all to express its views thereon or to
introduce any amendment. The customary practice is,
after the Senate has considered the Lower House Bill,
it returns the same to the House of origin with its
amendments. In the event that there may be any
differences between the two, the same shall then be
referred to a Conference Committee composed of
members from both Chambers which shall then
proceed to reconcile said differences.
In the instant case, the Senate transmitted to the
Lower House on March 24, 1994, a letter informing the
latter that it had “passed S. No. 1630 entitled . . . (and)
in view of the disagreeing provisions of said bill and
House Bill No. 11197, entitled . . . the Senate requests
a conference . . .” This, in spite of the fact that Com.
Report No. 349 of the Senate Committee on Ways and
Means had already recommended for approval on
February 7, 1994 “S.B. No. 1630 . . . taking into
consideration H.B. No. 11197.” Clearly, the Conference
Committee could only have acted upon Senate Bill No.
1630, for House Bill No. 11197 had already been fused
into the former.
At the oral hearing of July 7, 1994, petitioner in
G.R. No. 115455 admitted, in response to this writer’s
query, that he had
_______________
33 Article VI, Section 1.
771
VOL. 235, AUGUST 25, 1994 771
attempted to rectify some of the perceived

irregularities by presenting a motion in the Senate to
recall the bill from the Conference Committee so that it
could revert to the period of amendment,
34
but he was
outvoted, in fact “slaughtered.”
In accordance with the Rules of the House of
Representatives and the Senate, Republic Act No. 7716
was duly authenticated after it was signed by the
President of the Senate and the Speaker of the House
of Representatives followed by the certifications of the
Secretary of the Senate and the Acting35 Secretary
General of the House of Representatives. With the
signature of
________________
34 Transcript of the Stenographic Notes (TSN) on the Hearing Had

on Thursday, July 7, 1994, pp. 45-46:
“Justice Romero: Q: Mr. Counsel, is it not a fact that in the

Bicameral Conference Committee, you presented a Motion to
return the Bill as it was to the Lower House with also your
proposal that this be referred to a Referendum for the entire
nation to vote upon, then Senator Wigberto Tañada amended your
Motion and convinced you to drop that portion about referral to a
Referendum and you agreed.
So that Motion of yours to return to the House was the one
voted upon by the Bicameral Conference Committee and it lost.
What can you say to that?
Senator Tolentino: A: No, No, if Your Honor please. My Motion
was voted upon by the Senate itself because I presented that said
motion in order to recall the Bill from the Bicameral Conference
Committee so that the Senate could go back to the period of
amendment and see if we could amend the House Bill itself, but
that was defeated. So, it became academic. Thus, what we did we
proceeded with the procedure already being followed by the
Senate.
I thought, as a matter of fact, that was the one way of
correcting this procedural error, but I was only one (1), or two (2), or
three (3) of us only, then we were defeated in the voting, if Your
Honor please.
Justice Romero: Q: You mean you were outvoted?
Senator Tolentino: A: Yes, Your Honor; we were actually
slaughtered in the voting, so to speak, if Your Honor please.”
35 The certification states: “This Act which is a consolidation of

House Bill No. 11197 and Senate Bill No. 1630 was finally passed by
the House of Representatives and the Senate on April 7, 1994 and
May 2, 1994, respectively.”
772

President Fidel V. Ramos under the words “Approved:

5 May 1994,” it was finally promulgated.
Its legislative journey ended, Republic Act No. 7716
attained the status of an enrolled bill which is defined
as one “which has been duly introduced, finally passed
by both houses, signed by the proper officers of each,
approved by the governor36
(or president) and filed by
the secretary of state.”
Stated differently:
“It is a declaration by the two houses, through their

presiding officers, to the president, that a bill, thus attested,
has received in due form, the sanction of the legislative
branch of the government, and that it is delivered to him in
obedience to the constitutional requirement that all bills
which pass Congress shall be presented to him. And when a
bill, thus attested, receives his approval, and is deposited in
the public archives, its authentication as a bill that has
passed Congress should be deemed complete and
unimpeachable. As the President has no authority to approve
a bill not passed by Congress, an enrolled Act in the custody
of the Secretary of State, and having the official attestations
of the Speaker of the House of Representatives, of the
President of the Senate, and of the President of the United
States, carries, on its face, a solemn assurance by the
legislative and executive departments of the government,
charged, respectively, with the duty of enacting and
executing the laws, that it was passed by Congress. The
respect due to coequal and independent departments
requires the judicial department to act upon that assurance,
and to accept, as having passed Congress, all bills
authenticated in the manner stated; leaving the courts to
determine, when the question properly arises, whether the
Act, so authenticated,
37
is in conformity with the
Constitution.”
The enrolled bill assumes importance when there is

some variance between what actually transpired in the
halls of Congress, as reflected in its journals, and as
shown in the text of the law as finally enacted. But
suppose the journals of either or both Houses fail to
disclose that the law was passed in accordance with
what was certified to by their respective presiding
officers and the President. Or that certain
constitutional requirements regarding its passage were
not observed, as in the instant case.
_______________
36 BLACK’S LAW DICTIONARY, 5th Ed. (1979).

37 Field v. Clark, 143 U.S. 649, 36 L ed. 294.
773
VOL. 235, AUGUST 25, 1994 773

Which shall prevail: the journal or the enrolled bill?

A word on the journal.
“The journal is the official record of the acts of a
legislative body. It should be a true record of the
proceedings arranged in chronological order. It should
be a record of what is done rather than what is said.
The journal should be a clear, concise, unembellished
statement of all proposals made and all actions taken
complying with all requirements of constitutions,
statutes, charters or rules concerning 38
what is to be
recorded and how it is to be recorded.”
Article VI, Section 16 (4) of the Constitution
ordains:
“Each house shall keep a Journal of its proceedings, and from

time to time publish the same, excepting such parts as may,
in its judgment, affect national security; and the yeas and
nays on any question shall, at the request of one-fifth of the
Members present, be entered in the Journal.
Each House shall also keep a Record of its proceedings.”
(Italics supplied)
The rationale behind the above provision and of the

“journal entry rule” is as follows:
“It is apparent that the object of this provision is to make the

legislature show what it has done, leaving nothing whatever
to implication. And, when the legislature says what it has
done, with regard to the passage of any bill, it negatives the
idea that it has done anything else in regard thereto. Silence
proves nothing where one is commanded to speak. . . . Our
constitution commands certain things to be done in regard to
the passage of a bill, and says that no bill shall become a law
unless these things are done. It seems a travesty upon our
supreme law to say that it guaranties to the people the right
to have their laws made in this manner only, and that there
is no way of enforcing this right, or for the court to say that
this is law when the constitution says it is not law. There is
one safe course which is in harmony with the constitution,
and that is to adhere to the rule that the legislature must
show, as commanded by the constitution, that it has done
everything required by the constitution to be done in the
serious and important matter of making laws. This is the
rule of evidence
_______________
38 Mason, Paul, MASON’s MANUAL OF LEGISLATIVE PROCEDURE,
1953.
774

provided by the constitution. It is not presumptuous in the

courts, nor disrespectful to the legislature,
39
to judge the acts
of the legislature by its own evidence.”
Confronted with a discrepancy between the journal

proceedings and the law as duly enacted, courts have
indulged in different theories. The “enrolled bill” and
“journal entry” rules, being rooted deep in the
Parliamentary practices of England where there is no
written constitution, and then transplanted to the
United States, it may be instructive to examine which
rule prevails in the latter country through which, by a
process of legislative osmosis, we adopted them in
turn.
“There seems to be three distinct and different rules as

applicable to the enrolled bill recognized by the various
courts of this country. The first of these rules appears to be
that the enrolled bill is the ultimate proof and exclusive and
conclusive evidence that the bill passed the legislature in
accordance with the provisions of the Constitution. Such has
been the holding in California, Georgia, Kentucky, Texas,
Washington, New Mexico, Mississippi, Indiana, South
Dakota, and may be some others.
The second of the rules seems to be that the enrolled bill is
a verity and resort cannot be had to the journals of the
Legislature to show that the constitutional mandates were
not complied with by the Legislature, except as to those
provisions of the Constitu-tion, compliance with which is
expressly required to be shown on the journal. This rule has
been adopted in South Carolina, Montana, Oklahoma, Utah,
Ohio, New Jersey, United States Supreme Court, and others.
The third of the rules seems to be that the enrolled bill
raises only a prima facie presumption that the mandatory
provisions of the Constitution have been complied with and
that resort may be had to the journals to refute that
presumption, and if the constitutional provision is one,
compliance with which is expressly required by the
Constitution to be shown on the journals, then the mere
silence of the journals to show a compliance therewith will
refute the presumption. This rule has been adopted in
Illinois, Florida, Kansas, Louisiana, Tennessee, Arkansas,
Idaho, Minnesota, Nebraska,
40
Arizona, Oregon, New Jersey,
Colorado, and others.”
_______________
39 Cohn v. Kingsley, 49 P. 985 (1897).

40 Smith v. Thompson, 258 N.W. 190.
775
VOL. 235, AUGUST 25, 1994 775

In the 1980 case of D & W Auto Supply v. Department

of Revenue, the Supreme Court of Kentucky which had
subscribed in the past to the first of the three theories,
made the pronouncement that it had shifted its stand
and would henceforth adopt the third. It justified its
changed stance, thus:
“We believe that a more reasonable rule is the one which

Professor Sutherland describes as the ‘extrinsic evidence’
rule . . . . Under this approach there is a prima facie
presumption that an enrolled bill is valid, but such
presumption may be over-come by clear satisfactory and
convincing evidence establishing41
that constitutional
requirements have not been met.”
What rule, if any, has been adopted in this

jurisdiction?
Advocates of the “journal42
entry rule” cite the 1916
decision in U.S. v. Pons where this Court placed
reliance on the legislative journals to determine
whether Act No. 2381 was passed on February 28,
1914 which is what appears in the Journal, or on
March 1, 1914 which was closer to the truth. The
confusion was caused by the adjournment sine die at
midnight of February 28, 1914 of the Philippine
Commission.
A close examination of the decision reveals that the
Court did not apply the “journal entry rule” vis-a-vis
the “enrolled bill rule” but the former as against what
are “behind the legislative journals.”
“Passing over the question of whether the printed Act (No.

2381), published by authority of law, is conclusive evidence
as to the date when it was passed, we will inquire whether
the courts may go behind the legislative journals for the
purpose of determining the date 43
of adjournment when such
journals are clear and explicit.”
It is to be noted from the above that the Court “passed

over” the probative value to be accorded to the enrolled
bill. Opting for the journals, the Court proceeded to
explain:
________________
41 602 S.W. 2d 420 (1980).

42 34 Phil. 729 (1916).
43 Ibid at 733.
776

“From their very nature and object, the records of the

Legislature are as important as those of the judiciary, and to
inquire into the veracity of the journals of the Philippine
Legislature, when they are, as we have said clear and
explicit, would be to violate both the letter and the spirit of
the organic laws by which the Philippine Government was
brought into existence, to invade a coordinate and
independent department of the Government, and to interfere
with the 44legitimate powers and functions of the
Legislature.”
Following the courts in the United States since the

Constitution of the Philippine Government is modeled
after that of the Federal Government, the Court did
not hesitate to follow the courts in said country, i.e., to
consider the journals decisive of the point at issue.
Thus: “The journals say that the Legislature adjourned
at 12 midnight on February 28, 1914. This settles the
question and the court45 did not err in declining to go
behind these journals.”
The Court made a categorical stand for the “enrolled
bill rule” for the46 first time in the 1947 case of Mabanag
v. Lopez Vito where it held that an enrolled bill
imports absolute verity and is binding on the courts.
This Court held itself bound by an authenticated
resolution, despite the fact that the vote of three-
fourths of the Members of the Congress (as required by
the Constitution to approve proposals for
constitutional amendments) was not actually obtained
on account of the suspension of some members of the
House of Representatives and the Senate. In this
connection, the Court invoked the “enrolled bill rule” in
this wise: “If a political question conclusively binds the
judges out of respect to the political departments, a
duly certified law or resolution also binds the judges 47
under the ‘enrolled bill rule’ born of that respect.”
Mindful that the U.S. Supreme Court is on the side
of those who favor the rule and for no other reason
than that it conforms to the expressed policy of our law
making body (i.e., Sec. 313 of the old Code of Civil
Procedure, as amended by Act No. 2210), the Court
said that “duly certified copies shall be conclusive proof
of
_______________
44 Ibid at 733-734.
45 Ibid at 735.
46 78 Phil. 1 (1947).
47 Ibid at 3.
777
VOL. 235, AUGUST 25, 1994 777

the provisions of such Acts and of the due enactment

thereof.” Without pulling the legal underpinnings from
U.S. v. Pons, it justified its position by saying that if
the Court at the time looked into the journals, “in all
probability, those were the documents offered in
evidence” and that “even if both the journals and
authenticated copy of the Act had been presented, the
disposal of the issue by the Court on the basis of the
journals does not imply rejection of the enrolled theory;
for as already stated, the due enactment of a law may
be proved in either of the two ways
48
specified in Section
313 of Act No. 190 as amended.” Three Justices voiced
their dissent from the majority decision.
Again, the Court made its position plain in the 1963
case
49
of Casco Philippine Chemical Co., Inc. v. Gimenez
when a unanimous Court ruled that: “The enrolled
bill is conclusive upon the courts as regards the tenor of
the measure passed by Congress and approved by the
President. If there has been any mistake in the
printing of a bill before it was certified by the officers
of Congress and approved by the Executive, the
remedy is by amendment or curative legislation not by
judicial decree.” According to Webster’s New 20th
Century Dictionary, 2nd ed., 1983, the word “tenor”
means, among others, “the general drift of something
spoken or written; intent, purport, substance.”
Thus, the Court upheld the respondent Auditor
General’s interpretation that Republic Act No. 2609
really exempted from the margin fee on foreign
exchange transactions “urea formaldehyde” as found in
the law and not “urea and formaldehyde” which
petitioner insisted were the words contained in the bill
and were so intended by Congress.
In 1969, the Court similarly placed the weight of its
authority behind the conclusiveness of the enrolled bill.
In denying the motion for reconsideration, the Court
ruled in Morales v. Subido that “the enrolled Act in the
office of the legislative secretary of the President of the
Philippines shows that Section 10 is exactly as it is in
the statute as officially published in slip form by the
Bureau of Printing. x x x Expressed elsewise, this is a
matter worthy of the attention not of an Oliver
Wendell Holmes but of a
_______________
48 Ibid at 18.
49 117 Phil. 363 (1963).
778

50
Sherlock Holmes.” The alleged omission of a phrase in
the final Act was made, not at any stage of the
legislative proceedings, but only in the course of the
engrossment of the bill, more specifically in the
proofreading thereof.
But the Court did include a caveat that qualified the
absoluteness of the “enrolled bill” rule stating:
“By what we have essayed above we are not of course to be

understood as holding that in all cases the journals must
yield to the enrolled bill. To be sure there are certain matters
which the Constitution (Art. VI, secs. 10 [4], 20 [1], and 21
[1]) expressly requires must be entered on the journal of each
house. To what extent the validity of a legislative act may be
affected by a failure to have such matters entered on the
journal, is a question which we do not now decide (Cf. e.g.,
Wilkes Country Comm’rs. v. Coler, 180 U.S. 506 [1900]). All
we hold is that with respect to matters not expressly
required to be entered on the journal, 51
the enrolled bill
prevails in the event of any discrepancy.”
More recently, in the 521993 case of Philippine Judges

Association v. Prado, this Court, in ruling on the
unconstitutionality of Section 35 of Republic Act No.
7354 withdrawing the franking privilege from the
entire hierarchy of courts, did not so much adhere to
the enrolled bill rule alone as to both “enrolled bill and
legislative journals.” Through Mr. Justice Isagani A.
Cruz, we stated: “Both the enrolled bill and the
legislative journals certify that the measure was duly
enacted, i.e., in accordance with Article VI, Sec. 26 (2)
of the Constitution. We are bound by such official
assurances from a coordinate department of the
government, to which we owe, at the very least, a
becoming courtesy.”
Aware of the shifting sands on which the validity
and continuing relevance of the “enrolled bill” theory
rests, I have taken pains to trace the history of its
applicability in this jurisdiction, as influenced in
varying degrees by different Federal rulings.
As applied to the instant petition, the issue posed is
whether or not the procedural irregularities that
attended the passage of House Bill No. 11197 and
Senate Bill No. 1630, outside of the
_______________
50 136 Phil. 405, 409 (1969).

51 Ibid at 412.
52 G.R. No. 105371, November 11, 1993, 227 SCRA 703.
779
VOL. 235, AUGUST 25, 1994 779

reading and printing requirements which were

exempted by the Presidential certification, may no
longer be impugned, having been “saved” by the
conclusiveness on us of the enrolled bill. I see no cogent
reason why we cannot continue to place reliance on the
enrolled bill, but only with respect to matters
pertaining to the procedure followed in the enactment
of bills in Congress and their subsequent engrossment,
printing errors, omission of words and phrases and
similar relatively minor matters relating more to form
and factual issues which do not materially alter the
essence and substance of the law itself.
Certainly, “courts cannot claim greater ability to
judge procedural legitimacy, since constitutional rules
on legislative procedure are easily mastered.
Procedural disputes are over facts—whether or not the
bill had enough votes, or three readings, or whatever—
not over the meaning of the constitution. Legislators,
as eyewitnesses, are in a better position than a court to
rule on the facts. The argument is also made that
legislatures would be 53
offended if courts examined
legislative procedure.
Such a rationale, however, cannot conceivably apply
to substantive changes in a bill introduced towards the
end of its tortuous trip through Congress, catching
both legislators and the public unawares and altering
the same beyond recognition even by its sponsors.
This issue I wish to address forthwith.
EXTENT OF THE POWER OF THE BICAMERAL

CONFERENCE COMMITTEE
One of the issues raised in these petitions, especially in

G.R. Nos. 115781, 115543 and 115754, respectively, is
whether or not—
“Congress violated Section 26, par. 2, Article VI (of the 1987

Constitution) when it approved the Bicameral Conference
Committee Report which embodied, in violation of Rule XII of
the Rules of the Senate, a radically altered tax measure
containing provisions not reported out or discussed in either
House as well as provisions on which
_______________
53 Davies, Jack, LEGISLATIVE LAW AND PROCESS, 2nd ed., 1986.
780

there was no disagreement between the House and the

Senate and, worse, provisions contrary to what the House
and the 54 Senate had approved after three separate
readings.”
and
“By adding or deleting provisions, when there was no

conflicting provisions between the House and Senate
versions, the BICAM acted in excess of its jurisdiction or
with such grave abuse of discretion as to amount to loss of
jurisdiction. x x x In adding to the bill and thus subjecting to
VAT, real properties, media and cooperatives despite the
contrary decision of both Houses, the BICAM exceeded its
jurisdiction or acted with such55 abuse of discretion as to
amount to loss of jurisdiction ....”
I wish to consider this issue in light of Article VIII,

Sec. 1 of the Constitution which provides that
“(j)udicial power includes the duty of the courts of
justice x x x to determine whether or not there has
been a grave abuse of discretion amounting to lack or
excess of jurisdiction on the part of any branch or
instrumentality of the Government.” We are also
guided by the principle that a court may interfere with
the internal procedures of
56
its coordinate branch only to
uphold the Constitution.
A conference committee has been defined:
“. . . unlike the joint committee is two committees, one

appointed by each house. It is normally appointed for a
specific bill and its function is to gain accord between the two
houses either by the recession of one house from its bill or its
amendments or by the further amendment of the existing
legislation or by the substitution of an entirely new bill.
Obviously, the conference committee is always a special
committee and normally includes the member who
introduced the bill and the chairman of the committee which
considered it together with such other representatives of the
houses as seem expedient. (Horack, Cases and Materials on
Legislation [1940] 220. See also Zinn, Conference Procedure
in Congress, 38 ABAJ 864 [1952]; Steiner, The57Congressional
Conference Committee [U of Ill. Press, 1951]).”
________________
54 Petition in G.R. No. 115781, p. 18.

55 Petition in G.R. No. 115543, pp. 2-3.
56 Davies, Jack, supra at 90.
57 Sutherland, J.G., STATUTES AND STATUTORY
CONSTRUCTION, Vol. I, 4th ed., pp. 293-294.
781
VOL. 235, AUGUST 25, 1994 781

From the foregoing definition, it is clear that a

bicameral conference committee is a creature, not of
the Constitution, but of the legislative body under its
power to determine rules of its proceedings under
Article VI, Sec. 16 (3) of the Constitution. Thus, it
draws its life and vitality from the rules governing its
creation. The why, when, how and wherefore of its
operations, in other words, the parameters within
which it is to function, are to be found in Section 26,
Rule XII of the Rules of the Senate and Section 85 of
the Rules of the House of Representatives,
respectively, which provide:
Rule XII, Rules of the Senate
“SEC. 26. In the event that the Senate does not agree with
the House of Representatives on the provision of any bill or
joint resolution, the differences shall be settled by a
conference committee of both Houses which shall meet
within ten days after their composition.
The President shall designate the members of the
conference committee in accordance with subparagraph (c),
Section 8 of Rule III.
or amendments to the subject measure, and shall be signed
by the conferees.
unless the report has been filed with the Secretary of the
Senate and copies thereof have been distributed to the
Members.”
Rules of the House of Representatives
“SEC. 85. Conference Committee Reports.—In the event that

amendments to any bill or joint resolution, the differences
may be settled by conference committee of both Chambers.
The consideration of conference committee reports shall
always be in order, except when the journal is being read,
while the roll is being called or the House is dividing on any
question. Each of the pages of such reports shall contain a
detailed, sufficiently explicit statement of the changes in or
amendments to the subject measure.
unless copies thereof are distributed to the Members:
Provided, That in the last fifteen days of each session period
it shall be deemed sufficient that three copies of the report,
signed as above provided, are deposited in the office of the
Secretary General.”
782
Under these Rules, a bicameral conference committee

comes into being only when there are disagreements
and differences between the Senate and the House
with regard to certain provisions of a particular
legislative act which have to be reconciled.
Jefferson’s Manual, which, according to Section 112,
Rule XLIX of the Senate Rules, supplements it, states
that a conference committee is usually called “on the
occasion of amendments between the Houses” and “in
all cases of difference of opinion between 58
the two
Houses on matters pending between them.” It further
states:
“The managers of a conference must confine themselves to the

differences committed to them, and may not include subjects
not within the disagreements, even though germane to a
question in issue. But they may perfect amendments
committed to them if they do not in so doing go beyond the
differences. x x x Managers59 may not change the text to which
both Houses have agreed.” (Italics supplied.)
Mason’s Manual of Legislative Procedures which is also

considered as controlling authority for any60
situation
not covered by a specific legislative rule, states that
either House may “request a conference with the other
on any matter of difference or dispute between them”
and that in such a request, “the 61
subject of the
conference should always be stated.”
In the Philippines, as in the United States, the
Conference Committee exercises such a wide range of
authority that they virtually constitute a third House
in the Legislature. As admitted by the Solicitor
General, “It was the practice in past Congresses for
Conference Committees to insert in bills approved by
the two Houses new provisions
62
that were not originally
contemplated by them.”
In Legislative Procedure, Robert Luce gives a
graphic description of the milieu and the
circumstances which have conspired to
________________
58 Page 261.
59 Page 268.
60 Davies, supra, at 65.
61 Sec. 764, p. 541.
62 Consolidated Memorandum for Respondents, p. 71.
783
VOL. 235, AUGUST 25, 1994 783

transform an initially innocuous mechanism designed

to facilitate legislative action into an all-powerful
Frankenstein that brooks no challenge to its authority
even from its own members.
“Their power lies chiefly in the fact that reports of conference

committees must be accepted without amendment or else
rejected in toto. The impulse is to get done with the matters
and so the motion to accept has undue advantage, for some
members are sure to prefer swallowing unpalatable
provisions rather than prolong controversy. This is the more
likely if the report comes in the rush of business toward the
end of a session, when to seek further conference might
result in the loss of the measure altogether. At any time in
the session there is some risk of such a result following the
rejection of a conference report, for it may not be possible to
secure a second conference, or delay may give opposition to
the main proposal chance to develop more strength.
x x x x x x x x x
Entangled in a network of rule and custom, the
Representative who resents and would resist this theft of his
rights, finds himself helpless. Rarely can he vote, rarely can
he voice his mind, in the matter of any fraction of the bill.
Usually he cannot even record himself as protesting against
some one feature while accepting the measure as whole.
Worst of all, he cannot by argument or suggested change, try
to improve what the other branch has done.
This means more than the subversion of individual rights.
It means to a degree the abandonment of whatever
advantage the bicameral system may have. By so much it in
effect transfers the lawmaking power to a small group of
members who work out in private a decision that almost
always prevails. What is worse, these men are not chosen in
a way to ensure the wisest choice. It has become the practice
to name as conferees the ranking members of the committee,
so that the accident of seniority determines. Exceptions are
made, but in general it is not a question of who are most
competent to serve. Chance governs, sometimes giving way to
favor, rarely to merit.
x x x x x x x x x
Speaking broadly, the system of legislating by conference
committee is unscientific and therefore defective. Usually it
forfeits the benefit of scrutiny and judgment by all the
wisdom available. Uncontrolled, it is inferior to that process
by which every amendment 63
is secured independent
discussion and vote. x x x.” (Italics supplied)
________________
63 Pages 404-405 and 407.
784

Not surprisingly has it been said: “Conference

Committee action is the most undemocratic procedure
in the legislative process;
64
it is an appropriate target for
legislative critics.”
In the case at bench, petitioners insist that the
Conference Committee to which Senate Bill No. 1630
and House Bill No. 11197 were referred for the purpose
of harmonizing their differences, overreached
themselves in not confining their “reconciliation”
function to those areas of disagreement in the two bills
but actually making “surreptitious insertions” and
deletions which amounted to a grave abuse of
discretion.
At this point, it becomes imperative to focus on the
errant provisions which found their way into Republic
Act No. 7716. Below is a breakdown to facilitate
understanding the grounds for petitioners’ objections:
INSERTIONS MADE BY BICAMERAL

CONFERENCE COMMITTEE (BICAM) TO
SENATE BILL (SB) NO. 1630 AND HOUSE BILL
(HB) NO. 11197
1. Sec. 99 of the National Internal Revenue Code

(NIRC)
(1) Under the HB, this section includes any person

who, in the course of trade or business, sells,
barters or exchanges goods OR PROPERTIES
and any person who LEASES PERSONAL
PROPERTIES.
(2) The SB completely changed the said section
and defined a number of words and phrases.
Also, Section 99-A was added which included
one who sells, exchanges, barters
PROPERTIES and one who imports
PROPERTIES.
(3) The BICAM version makes LESSORS of goods
OR PROPERTIES and importers of goods
LIABLE to VAT (subject of petition in G.R. No.
115754).
2. Section 100 (VAT on Sale of Goods)
The term “goods” or “properties” includes the following,

which were not found in either the HB or the SB:
________________
64 Davies, supra, at 81.
785
VOL. 235, AUGUST 25, 1994 785

—In addition to radio and television time;

SATELLITE TRANSMISSION AND
CABLE TELEVISION TIME.
—The term “Other similar properties” was
deleted, which was present in the HB and
the SB.
—Real properties held primarily for sale to
customers or held for lease in the ordinary
course or business were included, which
was neither in the HB nor the SB (subject
of petition in G.R. No. 115754).
3. Section 102
On what are included in the term “sale or exchange of

services,” as to make them subject to VAT, the BICAM
included/inserted the following (not found in either
House or Senate Bills):
1. Services of lessors of property, whether

personal or real (subject of petition in G.R. No.
115754);
2. Warehousing services;
3. Keepers of resthouses, pension houses, inns,
resorts;
4. Common carriers by land, air and sea;
5. Services of franchise grantees of telephone and
telegraph;
6. Radio and television broadcasting;
7. All other franchise grantees except those under
Section 117 of this Code (subject of petition in
G.R. No. 115852);
8. Services of surety, fidelity, indemnity, and
bonding com-panies;
9. Also inserted by the BICAM (on page 8 thereof)
is the lease or use of or the right to use of
satellite transmission and cable television time.
4. Section 103 (Exempt Transactions)
The BICAM deleted subsection (f) in its entirety,

despite its inclusion in both the House and Senate
Bills. Therefore, under Republic Act No. 7716, the
“printing, publication, importation or sale of books and
any newspaper, magazine, review, or bulletin which
appears at regular intervals with fixed prices for
subscription and sale and which is not devoted
principally to the publication of advertisements” is
subject to VAT (subject of petition in G.R. No. 115931
and G.R. No. 115544).
The HB and SB did not touch Subsection (g) but it
was amended by the BICAM by changing the word
TEN to FIVE.
786

Thus, importation of vessels with tonnage of more than

five thousand tons is VAT exempt.
Subsection L, which was identical in the HB and the
SB that stated that medical, dental, hospital and
veterinary services were exempted from the VAT was
amended by the BICAM by adding the qualifying
phrase: EXCEPT THOSE RENDERED BY
PROFESSIONALS, thus subjecting doctors, dentists
and veterinarians to the VAT.
Subsection U which exempts from VAT
“transactions which are exempt under special laws,”
was amended by the BICAM by adding the phrase:
EXCEPT THOSE GRANTED UNDER PD Nos. 66,
529, 972, 1491, AND 1590, AND NON-ELECTRIC
COOPERATIVES UNDER RA 6938 (subject of petition
in G.R. No. 115873), not found in either the HB or the
SB, resulting in the inclusion of all cooperatives to the
VAT, except non-electric cooperatives.
The sale of real properties was included in the
exempt transactions under the House Bill, but the
BICAM qualified this with the provision:
“(S) SALE OF REAL PROPERTIES NOT PRIMARILY

HELD FOR SALE TO CUSTOMERS OR HELD FOR LEASE
IN THE ORDINARY COURSE OF TRADE OR BUSINESS
OR REAL PROPERTY UTILIZED FOR LOW-COST AND
SOCIALIZED HOUSING AS DEFINED BY RA NO. 7279
OTHERWISE KNOWN AS THE URBAN DEVELOPMENT
AND HOUSING ACT OF 1992 AND OTHER RELATED
LAWS.” (subject of petition in G.R. No. 115754)
The BICAM also exempted the sale of properties, the

receipts of which are not less than P480,000.00 or more
than P720,000.00. Under the SB, no amount was
given, but in the HB it was stated that receipts from
the sale of properties not less than P350,000.00 nor
more than P600,000.00 were exempt.
It did not include, as VAT exempt, the sale or
transfer of securities, as defined in the Revised
Securities Act (BP 178) which was contained in both
Senate and House Bills.
5. Section 104
Not included in the HB or the SB is the phrase

“INCLUDING PACKAGING MATERIALS” which was
inserted by the BICAM
787
VOL. 235, AUGUST 25, 1994 787
in Section 104 (A) (1) (B), thus excluding from

creditable input tax packaging materials and the
phrase “ON WHICH A VALUE-ADDED TAX HAS
BEEN ACTUALLY PAID” in Section 104 (A) (2).
6. Section 107
Both House and Senate Bills provide for the payment

of P500.00 VAT registration fee but this was increased
by BICAM to P1,000.00.
7. Section 112
Regarding a person whose sales or receipts are exempt

under Section 103 (w), the BICAM inserted the phrase:
“THREE PERCENT UPON THE EFFECTIVITY OF
THIS ACT AND FOUR PERCENT (4%) TWO YEARS
THEREAFTER,” although the SB and the HB provide
only “three percent of his gross quarterly sales.”
8. Section 115
The BICAM adopted the HB version which subjects

common carriers by land, air or water for the transport
of passengers to 3% of their gross quarterly sales,
which is not found in the SB.
9. Section 117
The BICAM amended this section by subjecting

franchises on electric, gas and water utilities to a tax of
two percent (2%) on gross receipts derived x x x,
although neither the HB nor the SB has a similar
provision.
10. Section 17 (d)

(a) The BICAM defers for only 2 years the VAT on
services of actors and actresses, although the
SB defers it for 3 years.
(b) The BICAM uses the word “EXCLUDE” in the
section on deferment of VAT collection on
certain goods and services. The HB does not
contain any counterpart provision and SB only
allows deferment for no longer than 3 years.
788

11. Section 18 on the Tax Administration

Development Fund is an entirely new provision
not contained in the House/Senate Bills. This
fund is supposed to ensure effective
implementation of Republic Act No. 7716.
12. Section 19
No period within which to promulgate the

implementing rules and regulations is found in the HB
or the SB but BICAM provided “within 90 days” which
found its way in Republic Act No. 7716.
Even a cursory perusal of the above outline will
convince one that, indeed, the Bicameral Conference
Committee (henceforth to be referred to as BICAM)
exceeded the power and authority granted in the Rules
of its creation. Both Senate and House Rules limit the
task of the Conference Committee in almost identical
language to the settlement of differences in the
provisions or amendments to any bill or joint
resolution. If it means anything at all, it is that there
are provisions in subject bill, to start with, which differ
and, therefore, need reconciliation. Nowhere in the
Rules is it authorized to initiate or propose completely
new matter. Although under certain rules on
legislative procedure, like those in Jefferson’s Manual,
a conference committee may introduce germane
matters in a particular bill, such matters should be
circumscribed by the committee’s sole authority and
function to reconcile differences.
Parenthetically, in the Senate and in the House, a
matter is “germane” to a particular bill if there is a
common tie between said matter and the provisions
which tend to promote the object and purpose of the
bill it seeks to amend. If it introduces a new subject
matter not within the65purview of the bill, then it is not
“germane” to the bill. The test is whether or not the
change represented an amendment or extension of the
basic purpose of the original, or the introduction
66
of an
entirely new and different subject matter.
________________
65 See: 18 Words and Phrases 482 citing Kennedy v. Truss, Del.

Super., 13 A. 2nd 431, 435, 1 Terry 424 (1940).
66 United States Gypsum Co. v. State, Dept. of Revenue, 110 N.W.
2d 698, 71, 363, Mich. 548 (1961).
789
VOL. 235, AUGUST 25, 1994 789

In the BICAM, however, the germane subject matter

must be within the ambit of the disagreement between
the two Houses. If the “germane” subject is not covered
by the disagreement but it is reflected in the final
version of the bill as reported by the Conference
Committee or, if what appears to be a “germane”
matter67 in the sense that it is “relevant or closely
allied” with the purpose of the bill, was not the
subject of a disagreement between the Senate and the
House, it should be deemed an extraneous matter or
even a “rider” which should never be considered legally
passed for not having undergone the three-day reading
requirement. Insertion of new matter on the part of the
BICAM is, therefore, an ultra vires act which makes
the same void.
The determination of what is “germane” and what is
not may appear to be a difficult task but the Congress,
having been confronted with the problem before,
resolved it in accordance with the rules. In that case,
the Congress approved a Conference Committee’s
insertion of new provisions that were not contemplated
in any of the provisions in question between the
Houses simply because of the provision in Jefferson’s
Manual that conferees may report matters “which are
germane modifications of subjects in disagreement
68
between the Houses and the committee. In other
words, the matter was germane to the points of
disagreement between the House and the Senate.
As regards inserted amendments in the BICAM,
therefore, the task of determining what is germane to a
bill is simplified, thus: If the amendments are not
circumscribed by the subjects of disagreement between
the two Houses, then they are not germane to the
purpose of the bill.
In the instant case before us, the insertions and
deletions made do not merely spell an effort at settling
conflicting provisions but have materially altered the
bill, thus giving rise to the instant petitions on the part
of those who were caught unawares by the legislative
legerdemain that took place. Going by the definition of
the word “amendment” in Black’s Law Dictionary,
_________________
67 BLACK’s DICTIONARY, 6th ed., p. 687 citing State ex. rel.

Riley v. District Court of Second Judicial Dist. in and for Silver Bow
County, 103 Mont. 576, 64 P. 2d 115, 119 (1937).
68 CONGRESSIONAL RECORD, May 3, 1952, p. 885 cited in
Orquiola, Annotated Rules of the Senate, 1991 ed., pp. 40-41.
790

5th Ed., 1979, which means “to change or modify for

the better; to alter by modification, deletion, or
addition,” said insertions and deletions constitute
amendments. Consequently, these violated Article VI,
Section 26 (2) which provides inter alia: “Upon the last
reading of a bill, no amendment thereto shall be
allowed . . .” This proscription is intended to subject all
bills and their amendments to intensive deliberation
by the legislators and the ample ventilation of issues to
afford the public an opportunity to express their
opinions or objections issues to afford the public an
opportunity to express their opinions or objections
thereon. The same rationale underlies the three-
reading requirement to the end that no surpises may
be sprung on an unsuspecting citizenry.
Provisions of the “now you see it, now you don’t”
variety, meaning those which were either in the House
and/or Senate versions but simply disappeared or were
“bracketed out” of existence in the BICAM Report,
were eventually incorporated in Republic Act No. 7716.
Worse, some goods, properties or services which were
not covered by the two versions and, therefore, were
never intended to be so covered, suddenly found their
way into the same Report. No advance notice of such
insertions prepared the rest of the legislators, much
less the public who could be adversely affected, so that
they could be given the opportunity to express their
views thereon. Well has the final BICAM report been
described, therefore, as an instance of “taxation
without representation.”
That the conferees or delegates in the BICAM
representing the two Chambers could not possibly be
charged with bad faith or sinister motives or, at the
very least, unseemly behavior, is of no moment. The
stark fact is that items not previously subjected to the
VAT now fell under its coverage without interested
sectors or parties having been afforded the opportunity
to be heard thereon. This is not to say that the
Conference Committee Report should have undergone
the three readings required in Article VI, Section 26(2),
for this clearly refers only to bills which, after having
been initially filed in either House, negotiated the
labyrinthine passage therein until its approval. The
composition of the BICAM including as it usually does,
the Chairman of the appropriate Committee, the
sponsor of the bill and other interested members
ensures an informed discussion, at least with respect
to the disagreeing provisions. The same does not obtain
as regards completely new
791
VOL. 235, AUGUST 25, 1994 791

matter which suddenly spring on the legislative

horizon.
It has been pointed out that such extraneous
matters notwithstanding, all Congressmen and
Senators were given the opportunity to approve or turn
down the Committee Report in toto, thus “curing”
whatever defect or irregularity it bore. Earlier in this
opinion, I explained that the source of the
acknowledged power of this ad hoc committee stems
from the precise fact that, the meetings, being
scheduled “take it or leave it” basis. It has not been
uncommon for legislators who, for one reason or
another have been frustrated in their attempt to pass a
pet bill in their own chamber, to work for its passage in
the BICAM where it may enjoy a more hospitable
reception and faster approval. In the instant case, had
there been full, open and unfettered discussion on the
bills during the Committee sessions, there would not
have been as much vociferous objections on this score.
Unfortunately, however, the Committee held two of the
five sessions behind closed doors, sans stenographers,
record-takers and interested observers. To that extent,
the proceedings were shrouded in mystery and the
public’s right to information on matters 69of public
concern as enshrined in Article III, Section 7 and the
government’s policy of transparency in transactions
involving public
70
interest in Article II, Section 28 of the
Constitution are undermined.
Moreover, that which is void ab initio such as the
objectionable provisions in the Conference Committee
Report, cannot be “cured” or ratified. For all intents
and purposes, these never existed. Quae ab initio non
valent, ex post facto convalescere non possunt. Things
that are invalid from the beginning are not made valid
by a subsequent act.
________________
69 Article III, Section 7. “The right of the people to information on

matters of public concern shall be recognized. Access to official
records, and to documents, and papers pertaining to official acts,
transactions, or decisions, as well as to government research data
used as basis for policy development, shall be afforded the citizen,
subject to such limitations as may be provided by law.”
70 Article II, Section 28. “Subject to reasonable conditions
prescribed by law, the State adopts and implements a policy of full
public disclosure of all its transactions involving public interest.”
792

Should this argument be unacceptable, the “enrolled

bill” doctrine, in turn, is invoked to support the
proposition that the certification by the presiding
officers of Congress, together with the signature of the
President, bars further judicial inquiry into the
validity of the law. I reiterate my submission that the
“enrolled bill ruling” may be applicable but only with
respect to questions pertaining to the procedural
enactment, engrossment, printing, the insertion or
deletion of a word or phrase here and there, but would
draw a dividing line with respect to substantial
substantive changes, such as those introduced by the
BICAM herein.
We have before us then the spectacle of a body
created by the two Houses of Congress for the very
limited purpose of settling disagreements in provisions
between bills emanating therefrom, exercising the
plenary legislative powers of the parent chambers but
holding itself exempt from the mandatory
constitutional requirements that are the hallmarks of
legislation under the aegis of a democratic political
system. From the initial filing, through the three
readings which entail detailed debates and discussions
in Committee and plenary sessions, and on to the
transmittal to the other House in a repetition of the
entire process to ensure exhaustive deliberations—all
these have been skipped over. In the proverbial
twinkling of an eye, provisions that probably may not
have seen the light of day had they but run their full
course through the legislative mill, sprang into
existence and emerged full-blown laws.
Yet our Constitution vests the legislative power in
“the Congress of the Philippines which shall consist
71
of
a Senate and a House of Representatives . . . .” and
not in any special, standing or super committee of its
own creation, no matter that these have been
described, accurately enough, as “the eye, the ear, the
hand, and very often the brain of the house.”
Firstly, that usage or custom has sanctioned this
abbreviated, if questionable, procedure does not
warrant its being legitimized and perpetuated any
longer. Consuetudo, contra rationem introducta, potius
usurpatio quam consuetudo appellari debet. A custom
against reason is rather an usurpation. In the
hierarchy
_______________
71 Article VI, Section 1.
793
VOL. 235, AUGUST 25, 1994 793
of sources of legislative procedure, constitutional rules,

statutory provisions and adopted rules (as for example,
the Senate and House Rules), rank highest, certainly
much ahead of customs and usages.
Secondly, is this Court to assume the role of passive
spectator or indulgent third party, timorous about
exercising its power or more importantly, performing
its duty, of making a judicial determination on the
issue of whether there has been grave abuse of
discretion by the other branches or instrumentalities of
government, where the same is properly invoked? The
time is past when the Court was not loathe to raise the
bogeyman of the political question to avert a head-on
collision with either the Executive or Legislative
Departments. Even the separation of powers doctrine
was burnished to a bright sheen as often as it was
invoked to keep the judiciary within bounds. No longer
does this condition obtain. Article VIII, Section 2 of the
Constitution partly quoted in this paragraph has
broadened the scope of judicial inquiry. This Court can
now safely fulfill its mandate of delimiting the powers
of co-equal departments like the Congress, its officers
or its committees which may have no compunctions
about exercising legislative powers in full.
Thirdly, dare we close our eyes to the presumptuous
assumption by a runaway committee of its progenitor’s
legislative powers in derogation of the rights of the
people, in the process, subverting the democratic
principles we all are sworn to uphold, when a proper
case is made out for our intervention? The answers to
the above queries are self-evident.
I call to mind this exhortation: “We are sworn to see
that violations of the constitution—by any person,
corporation, state agency or branch of government—
are brought to light and corrected. To countenance an
artificial rule of law that silences our voices when
confronted with violations72
of our Constitution is not
acceptable to this Court.”
I am not unaware that a rather recent decision of
ours brushed aside an argument that a provision in
subject law regarding the withdrawal of the franking
privilege from the petitioners and this Court itself, not
having been included in the original version
_______________
72 D & W Auto Supply v. Department of Revenue, supra.
794

of Senate Bill No. 720 or of House Bill No. 4200 but

only in the Conference Committee Report, was
violative of Article VI, Section 26 (2) of the
Constitution. Likewise, that said Section 35, never
having been a subject of disagreement between both
Houses, could not have been validly added as an
amendment before the Conference Committee.
The majority opinion in said case explained:
“While it is true that a conference committee is the
mechanism for compromising differences between the
Senate and the House, it is not limited in its
jurisdiction to this question. Its broader function is
described thus:
‘A conference committee may deal generally with the subject

matter or it may be limited to resolving the precise
differences between the two houses. Even where the
conference committee is not by rule limited in its jurisdiction,
legislative custom severely limits the freedom with which new
subject matter can be inserted into the conference bill. But
occasionally a conference committee produces unexpected
results, results beyond its mandate. These excursions occur
even where the rules impose strict limitations on conference
committee jurisdiction. This is symptomatic of the
authoritarian power of conference committee (Davies,
Legislative
73
Law and Process: In a Nutshell, 1986 Ed., p. 81).’
” (Italics supplied)
At the risk of being repetitious, I wish to point out that

the general rule, as quoted above, is: “Even where the
conference committee is not by rule limited in its
jurisdiction, legislative custom severely limits the
freedom with which new subject matter can be inserted
into the conference bill.” What follows, that is,
“occasionally a conference committee produces
unexpected results, results beyond its mandate . . .” is
the exception. Then it concludes with a declaration
that: “This is symptomatic of the authoritarian power
of conference committee.” Are we about to reinstall
another institution that smacks of authoritarianism
which, after our past experience, has become
anathema to the Filipino people?
The ruling above can hardly be cited in support of
the proposition that a provision in a BICAM report
which was not
________________
73 The Philippine Judges Association v. Hon. Pete Prado, G.R. No.

105371, November 11, 1993, 227 SCRA 703, 709.
795
VOL. 235, AUGUST 25, 1994 795

the subject of differences between the House and

Senate versions of a bill cannot be nullified. It submits
that such is not authorized in our Basic Law.
Moreover, this decision concerns merely one provision
whereas the BICAM Report that culminated in the
EVAT law has a wider scope as it, in fact, expanded
the base of the original VAT law by imposing the tax
on several items which were not so covered prior to the
EVAT.
One other flaw in most BICAM Reports, not
excluding this one under scrutiny, is that, hastily
drawn up, it often fails to conform to the Senate and
House Rules requiring no less than a “detailed” and
“sufficiently explicit statement of the changes in or
amendments to the subject measure.” The Report of
the committee, as may be gleaned from the preceding
pages, was no more than the final version of the bill as
“passed” by the BICAM. The amendments or subjects
of dissension, as well as the reconciliation made by the
committee, are not even pointed out, much less
explained therein.
It may be argued that legislative rules of procedure
may properly be suspended, modified, revoked 74
or
waived at will by the legislators themselves. This
principle, however, does not come into play in
interpreting what the record of the proceedings shows
was, or was not, done. It is rather designed to test the
validity of legislative action where the record shows a
final 75action in violation or disregard of legislative
rules. Utilizing the Senate and the House Rules as
both guidelines and yardstick, the BICAM here
obviously did not adhere to the rule on what the Report
should contain.
Given all these irregularities that have apparently
been engrafted into the BICAM system, and which
have been tolerated, if not accorded outright
acceptance by everyone involved in or conversant with,
the institution, it may be asked: Why not leave well
enough alone?
_________________
74 In Osmeña, Jr. v. Pendatun, (109 Phil. 863 [1960]), the Court

held that parliamentary rules are merely procedural and they may
be waived or disregarded by the legislative body. Hence, mere failure
to conform to parliamentary usage will not invalidate the action
taken by a deliberative body when the requisite number of members
have agreed to a particular measure.
75 State v. Essling, 128 N.W. 2d 307, 316 (1964).
796

That these practices have remained unchallenged in

the past does not justify our closing our eyes and
turning a deaf ear to them. Writ large is the spectacle
of a mechanism ensconced in the very heart of the
people’s legislative halls, that now stands indicted with
the charge of arrogating legislative powers unto itself
through the use of dubious “shortcuts.” Here, for the
people to judge, is the “mother of all shortcuts.”
In the petitions at bench, we are confronted with the
enactment of a tax law which was designed to broaden
the tax base. It is rote learning for any law student
that as an attribute of sovereignty, the power to tax is 76
“the strongest of all the powers of government.”
Admittedly, “for all its plenitude, the power
77
to tax is
not unconfined. There are restrictions.” Were there
none, then the oft-quoted 1803 dictum of Chief Justice
Marshall78 that “the power to tax involves the power to
destroy” would be a truism. Happily, we can concur
with, and the people can find comfort in, the
reassuring words of Mr. Justice Holmes: “The power79to
tax is not the power to destroy while this Court sits.”
Manakanakâ, mayroóng dumudulóg dito sa
Kátaastaasang Hukuman na may kamangha-
mangháng hinaíng. Angkóp na halimbawà ay ang mga
petisyóng iniharáp ngayón sa amin.
Ang ilán sa kanilá ay mga Senadór na nais
mapawaláng bisà ang isáng batás ukol sa buwís na
ipinasá mismo nilá. Diumanó itó ay hindî tumalima sa
mga itinatadhana ng Sáligang Batás. Bukód sa rito,
tutol silá sa mga bagong talatà na isiningit ng
“Bicameral Conference Committee” na nagdagdág ng
mga bagong bagay bagay at serbisyo na papatawan ng
buwís. Ayon sa kanilá, ginampanán ng komiténg iyán
ang gawain na nauukol sa buóng Kongreso. Kung
kayá’t ang nararapat na mangyari ay ihatol ng
Kátaastaasang Hukuman na malabis na
pagsasamantala sa sariling pagpapasiyá ang ginawâ
ng Kongreso.
Bagamá’t bantulót kamíng makialám sa isáng
kapantáy na sangáy ng Pamahalaán, hindî naman
nararapat na kamí ay
________________
76 Sarasola v. Trinidad, 40 Phil. 252, 262 (1919).

77 Sison, Jr. v. Ancheta, L-59431, July 25, 1984, 130 SCRA 654,
660.
78 McCullock v. Maryland, 4 Wheaton 316.
79 Quoted in Graves. v. New York, 306 U.S. 466, 490.
797
VOL. 235, AUGUST 25, 1994 797

tumanggíng gampanán ang tungkulin na iniatas sa

amin ng Saligang Batas. Lalu’t-lalò nang ang batás na
kinauukulan ay maaaring makapinsalá sa nakararami
sa sambayanán.
Sa ganang akin, itong batas na inihaharap sa amin
ngayón, ay totoóng labág sa Saligang Batás,
samakatuwíd ay waláng bisà. Nguni’t itó ay nauukol
lamang sa mga katiwalián na may kinalaman sa
paraán ng pagpapasabatás nitó. Hindî namin
patakarán ang makialám o humadláng sa itinakdáng
gawain ng Saligang Batás sa Pangulò at sa Kongreso.
Ang dalawáng sangáy na iyán ng Pamahalaán ang
higít na maalam ukol sa kung ang anumáng
panukalang batás ay nararapat, kanais-nais o
magagampanán; kung kayá’t hindî kamí nararapat na
maghatol o magpapasiyá sa mga bagay na iyán. Ang
makapapataw ng angkop na lunas sa larangan na iyán
ay ang mismong mga kinatawán ng sambayanán sa
Kongreso.
Faced with this challenge of protecting the rights of
the people by striking down a law that I submit is
unconstitutional and in the process, checking the
wonted excesses of the Bicameral Conference
Committee system, I see in this case a suitable vehicle
to discharge the Court’s Constitutional mandate and
duty of declaring that there has indeed been a grave
abuse of discretion amounting to lack or excess of
jurisdiction on the part of the Legislature.
Republic Act No. 7716, being unconstitutional and
void, I find no necessity to rule on the substantive
issues as dealt with in the majority opinion as they
have been rendered moot and academic. These issues
pertain to the intrinsic merits of the law. It is
axiomatic that the wisdom, desirability and
advisability of enacting certain laws lie, not within the
province of the Judiciary but that of the political
departments, the Executive and the Legislative. The
relief sought by petitioners from what they perceive to
be the harsh and onerous effect of the EVAT on the
people is within their reach. For Congress, of which
Senator-petitioners are a part, can furnish the solution
by either repealing or amending the subject law.
For the foregoing reasons, I VOTE to GRANT the
petition.
798

DISSENTING OPINION
BELLOSILLO, J.:
With a consensus already reached after due
deliberations, silence perhaps should be the better part
of discretion, except to vote. The different views and
opinions expressed are so persuasive and convincing;
they are more than enough to sway the pendulum for
or against the subject petitions. The penetrating and
scholarly dissertations of my brethren should dispense
with further arguments which may only confound and
confuse even the most learned of men.
But there is a crucial point, a constitutional issue
which, I submit, has been belittled, treated lightly, if
not almost considered insignificant and purposeless. It
is elementary, as much as it is fundamental. I am
referring to the word “exclusively” appearing in Sec.
24, Art. VI, of our 1987 Constitution. This is
regrettable, to say the least, as it involves a
constitutional mandate which, wittingly or
unwittingly, has been cast aside as trivial and
meaningless.
A comparison of the particular provision on the
enactment of revenue bills in the U.S. Constitution
with its counterpart in the Philippine Constitution will
help explain my position.
Under the U.S. Constitution, “[a]ll bills for raising
revenue shall originate in the House of
Representatives; but the Senate may propose or concur
with amendments as on other bills” (Sec. 7, par. [1],
Art. I). In contrast, our 1987 Constitution reads: “All
appropriation, revenue or tariff bills, bills authorizing
increase of the public debt, bills of local application,
and private bills shall originate exclusively in the
House of Representatives, but the Senate may propose
or concur with amendments” (Sec. 24, Art. VI; italics
supplied).
As may be gleaned from the pertinent provision of
our Constitution, all revenue bills are required to
originate “exclusively” in the House of Representatives.
On the other hand, the U.S. Constitution does not use
the word “exclusively”; it merely says, “[a]ll bills for
raising revenue shall originate in the House of
799
VOL. 235, AUGUST 25, 1994 799

Representatives.”
Since the term “exclusively” has already been
adequately defined in the various opinions, as to which
there seems to be no dispute, I shall no longer offer my
own definition.
Verily, the provision in our Constitution requiring
that all revenue bills shall originate exclusively from
the Lower House is mandatory. The word “exclusively”
is an “exclusive word,” which is indicative
1
of an intent
that the provision is mandatory. Hence, all American
authorities expounding on the meaning and
application of Sec. 7, par. (1), Art. I, of the U.S.
Constitution cannot be used in the interpretation of
Sec. 24, Art. VI, of our 1987 Constitution which has a
distinct feature of “exclusiveness” all its own. Thus,
when our Constitution absolutely requires—as it is
mandatory—that a particular bill should exclusively
emanate from the Lower House, there is no alternative
to the requirement that the bill to become valid law
must originate exclusively from that House.
In the interpretation of constitutions, questions
frequently arise as to whether particular sections are
mandatory or directory. The courts usually hesitate to
declare that a constitutional provision is directory
merely in view of the tendency of the legislature to
disregard provisions which are not said to be
mandatory. Accordingly, it is the general rule to regard
constitutional provisions as mandatory, and not to
leave any discretion to the will of the legislature to
obey or disregard them. This presumption as to
mandatory quality is usually followed unless it is
unmistakably manifest that the provisions are
intended to be merely directory. So strong is the
inclination in favor of giving obligatory force to the
terms of the organic law that it has even been said that
neither by the courts nor by any other department of
the government may any provision of the Constitution
be regarded as merely directory, but that each and
everyone of its provisions should be treated as
imperative and mandatory, without reference to the
rules and distinguishing
2
between the directory and the
mandatory statutes.
The framers of our 1987 Constitution could not have
used the term “exclusively” if they only meant to
replicate and adopt in
_______________
1 See McGee v. Republic, 94 Phil. 821 (1954).

2 See Tañada v. Cuenco , 103 Phil. 1051 (1957).
800

toto the U.S. version. By inserting “exclusively” in Sec.

24, Art. VI of our Constitution, their message is clear:
they wanted it different, strong, stringent. There must
be a compelling reason for the inclusion of the word
“exclusively,” which cannot be an act of retrogression
but progression, an improvement on its precursor.
Thus,”exclusively” must be given its true meaning, its
purpose observed and virtue recognized, for it could not
have been conceived to be of minor consequence. That
construction is to be sought which gives effect to the
whole of the statute—its every word. Ut magis valeat
quam pereat.
Consequently, any reference to American
authorities, decisions and opinions, however wisely
and delicately put, can only mislead in the
interpretation of our own Constitution. To refer to
them in defending the constitutionality of R.A. 7716,
subject of the present petitions, is to argue on a false
premise, i.e., that Sec. 24, Art. VI of our 1987
Constitution is, or means exactly, the same as Sec. 7,
par. (1), Art. I of the U.S. Constitution, which is not
correct. Hence, only a wrong conclusion can be drawn
from a wrong premise.
For example, it is argued that in the United States,
from where our own legislature is patterned, the
Senate can practically substitute its own tax measure
for that of the Lower House. Thus, according to the
Majority, citing an American case, “the validity of Sec.
37 which the Senate had inserted in the Tariff Act of
1909 by imposing an ad valorem tax based on the
weight of vessels, was upheld against the claim that
the revenue bill originated in the Senate in
contravention 3 of Art. I, Sec. 7, of the U.S.
Constitution.” In an effort to be more convincing, the
Majority even quotes the footnote in Introduction to
American Government by F.A. Ogg and P.O. Ray which
reads—
Thus in 1883 the upper house struck out everything after the
enacting clause of a tariff bill and wrote its own measure,
which the House eventually felt obliged to accept. It likewise
added 847 amendments to the Payne-Aldrich tariff act of
1909, dictated the schedules of the emergency tariff act of
1921, rewrote an extensive tax revision bill in the same year,
and recast most of the permanent tariff
________________
3 See Majority Opinion, p. 15, citing Rainey v. United States, 232 U.S.,
309, 58 Law Ed. 617.
801
VOL. 235, AUGUST 25, 1994 801

4
bill of 1922 —
which in fact suggests, very clearly, that the subject
revenue bill actually originated from the Lower House
and was only amended, perhaps considerably, by the
Senate after it was passed by the former and
transmitted to the latter.
In the cases cited, where the statutes passed by the
U.S. Congress were upheld, the revenue bills did not
actually originate from the Senate but, in fact, from
the Lower House. Thus, the Supreme Court of the
United States, speaking through
5
Chief Justice White
in Rainey v. United States upheld the revenue bill
passed by Congress and adopted the ruling of the lower
court that—
x x x the section in question is not void as a bill for raising

revenue originating in the Senate and not in the House of
Representatives. It appears that the section was proposed by
the Senate as an amendment to a bill for raising revenue
which originated in the House. That is sufficient.
6
Flint v. Stone Tracy Co., on which the Solicitor
General heavily leans in his Consolidated Comment as
well as in his Memorandum, does not support the
thesis of the Majority since the subject bill therein
actually originated from the Lower House and not from
the Senate, and the amendment merely covered a
certain provision in the House bill.
In fine, in the cases cited which were lifted from
American authorities, it appears that the revenue bills
in question actually originated from the House of
Representatives and were amended by the Senate only
after they were transmitted to it. Perhaps, if the
factual circumstances in those cases were exactly the
same as the ones at bench, then the subject revenue or
tariff bill may be upheld in this jurisdiction on the
principle of substantial compliance, as they were in the
United States, except possibly in instances where the
House bill undergoes what is now referred to as
“amendment by substitution,” for that would be in
derogation
_______________
4 Id., citing F.A. Ogg and P.O. Ray, Introduction to American

Government, 302, n. 2 (1945).
5 See Note 3.
6 22 U.S. 107.
802

of our Constitution which vests solely in the House of

Representatives the power to initiate revenue bills. A
Senate amendment by substitution simply means that
the bill in question did not in effect originate from the
lower chamber but from the upper chamber and now
disguises itself as a mere amendment of the House
version.
It is also theorized that in the U.S., amendment by
substitution is recognized. That may be true. But the
process may be validly effective only under the U.S.
Constitution. The cases before us present a totally
different factual backdrop. Several months before the
Lower House could even pass HB No. 11197, P.S. Res.
No. 734 and SB No. 1129 had already been filed in the
Senate. Worse, the Senate subsequently approved SB
No. 1630 “in substitution of SB No. 1129, taking into
consideration P.S. Res. No. 734 and HB No. 11197,”
and not HB No. 11197 itself “as amended.” Here, the
Senate could not have proposed or concurred with
amendments because there was nothing to concur with
or amend except its own bill. It must be stressed that
the process of concurring or amending presupposes
that there exists a bill upon which concurrence may be
based or amendments introduced. The Senate should
have reported out HB No. 11197, as amended, even if
in the amendment it took into consideration SB No.
1630. It should not have submitted to the Bicameral
Conference Committee SB No. 1630 which, admittedly,
did not originate exclusively from the Lower House.
But even assuming that in our jurisdiction a
revenue bill of the Lower House may be amended by
substitution by the Senate—although I am not
prepared to accept it in view of Sec. 24, Art. VI, of our
Constitution—still R.A. 7716 could not have been the
result of amendment by substitution since the Senate
had no House bill to speak of that it could amend when
the Senate started deliberating on its own version.
Be that as it may, I cannot rest easy on the
proposition that a constitutional mandate calling for
the exclusive power and prerogative of the House of
Representatives may just be discarded and ignored by
the Senate. Since the Constitution is for the
observance of all—the judiciary as well as the other
departments of government—and the judges are sworn
to support its provisions, the courts are not at liberty
to overlook or disregard its commands. And it is not
fair and just to impute to them undue interference if
803
VOL. 235, AUGUST 25, 1994 803

they look into the validity of legislative enactments to

determine whether the fundamental law has been
faithfully observed in the process. It is their duty to
give effect to the existing Constitution and to obey all
constitutional provisions irrespective of their opinion
as to the wisdom of such provisions.
The rule is fixed that the duty in a proper case to
declare a law unconstitutional cannot be declined and
must be performed in accordance with the deliberate
judgment of the tribunal before which the validity of
the enactment is directly drawn into question. When it
is clear that a statute transgresses the authority
vested in the legislature by the Constitution, it is the
duty of the courts to declare the act unconstitutional
because they cannot shirk from it without violating
their oaths of office. This duty of the courts to maintain
the Constitution as the fundamental law of the state is
imperative and unceasing; and, as Chief Justice
Marshal said, whenever a statute is in violation of the
fundamental law, the courts must so adjudge and
thereby give effect to the Constitution. Any other
course would lead to the destruction of the
Constitution. Since the question as to the
constitutionality of a statute is a judicial matter, the
courts will not decline the exercise of jurisdiction upon
the suggestion that action might be taken by political
agencies in 7
disregard of the judgment of the judicial
tribunals.
It is my submission that the power and authority to
originate revenue bills under our Constitution is
vested exclusively in the House of Representatives. Its
members being more numerous than those of the
Senate, elected more frequently, and more directly
represent the people, are therefore considered better
aware of the economic life of their individual
constituencies. It is just proper that revenue bills
originate exclusively from them.
In this regard, we do not have to devote much time
delving into American decisions and opinions and
invoke them in the interpretation of our own
Constitution which is different from the American
version, particularly on the enactment of revenue bills.
We have our own Constitution couched in a language
our own legislators thought best. Insofar as revenue
bills are concerned, our Constitution is not American;
it is distinctively
_______________
7 11 Am. Jur., pp. 712-13, 713-715.
804

Filipino. And no amplitude of legerdemain can detract

from our constitutional requirement that all
appropriation, revenue or tariff bills, bills authorizing
increase of the public debt, bills of local application,
and private bills shall originate exclusively in the
House of Representatives, although the Senate may
propose or concur with amendments.
In this milieu, I am left no option but to vote to
grant the petitions and strike down R.A. 7716 as
unconstitutional.
DISSENTING OPINION
PUNO, J.:
Petitioners plead that we affirm the self-evident

proposition that they who make law should not break
the law. There are many evils whose elimination can
be trusted to time. The evil of lawlessness in
lawmaking cannot. It must be slain on sight for it
subverts the sovereignty of the people.
First, a fast snapshot of the facts. On November 17,
1993, the House of Representatives passed on third
reading House Bill (H.B.) No. 11197 entitled “An Act
Restructuring the Value Added Tax (VAT) System to
Widen its Tax Base and Enhance its Administration,
Amending for These Purposes Sections 99, 100, 102 to
108 and 110 of Title V and 236, 237 and 238 of Title IX,
and Repealing Sections 113 and 114 of Title V, all of
the National Internal Revenue Code as Amended.” The
vote was 114 Yeas and 12 Nays. The next day,
November 18, 1993, H.B. No. 11197 was transmitted to
the Senate for its concurrence by the Hon. Camilo L.
Sabio, Secretary General of the House of
Representatives.
On February 7, 1994, the Senate Committee on
Ways and Means submitted Senate Bill (S.B.) No.
1630, recommending its approval “in substitution of
Senate Bill No. 1129 taking into consideration P.S.
Res. No. 734 and House Bill No. 11197.” On March 24,
1994, S.B. No. 1630 was approved on second and third
readings. On the same day, the Senate, thru Secretary
Edgardo E. Tumangan, requested the House for a
conference “in view of the disagreeing provisions of
S.B. No. 1630 and H.B. No. 11197.” It designated the
following as members of its Committee: Senators
Ernesto F. Herrera, Leticia R. Shahani, Alberto S.
Romulo, John H. Osmeña, Ernesto M. Maceda, Blas F.
Ople, Francisco S.
805
VOL. 235, AUGUST 25, 1994 805

Tatad, Rodolfo G. Biazon, and Wigberto S. Tañada. On

the part of the House, the members of the Committee
were: Congressmen Exequiel B. Javier, James L.
Chiongbian, Renato V. Diaz, Arnulfo P. Fuentebella,
Mariano M. Tajon, Gregorio Andolong, Thelma
Almario, and Catalino Figueroa. After five (5)
meetings,1 the Bicameral Conference Committee
submitted its Report to the Senate and the House
stating:
“CONFERENCE COMMITTEE REPORT
The Conference Committee on the disagreeing provisions of

House Bill No. 11197, entitled:
REPEALING SECTIONS 113 AND 114 OF TITLE V, ALL
OF THE NATIONAL INTERNAL REVENUE CODE, AS
AMENDED
and Senate Bill No. 1630 entitled:
107, 108 AND 110 OF TITLE IV, 112, 115, 117 AND 121 OF
REPEALING SECTIONS 113, 114, 116, 119 AND 120 OF
TITLE V, ALL OF THE NATIONAL INTERNAL REVENUE
CODE, AS AMENDED AND FOR OTHER PURPOSES
having met, after full and free conference, has agreed to
recommend and do hereby recommend to their respective
Houses that House Bill No. 11197, in consolidation with
Senate Bill No. 1630, be approved in accordance with the
attached copy of the bill as reconciled and approved by the
conferees.
Approved.”
_______________
1 April 13, 19, 20, 21, and 25, 1994.
806

The Report was approved by the House on April 27,

1994. The Senate approved it on May 2, 1994. On May
5, 1994, the President signed the bill into law as R.A.
No. 7716.
There is no question that the Bicameral Conference
Committee did more than reconcile differences
between House Bill No. 11197 and Senate Bill No.
1630. In several instances, it either added new
provisions or deleted provisions already approved in
House Bill No. 11197 and Senate Bill No. 1630. These
insertions/dele-tions numbering twenty four (24) 2are
specified in detail by petitioner Tolentino as follows:
“SOME SALIENT POINTS ON THE (AMENDMENTS TO

THE VAT LAW [EO 273]) SHOWING
ADDITIONS/INSERTIONS MADE BY BICAMERAL
CONFERENCE COMMITTEE TO SB 1630 & HB 11197
I On Sec. 99 of the NIRC
H.B. 11197 amends this section by including, as liable to

VAT, any person who in the course of trade of business, sells,
barters, or exchanges goods or PROPERTIES and any person
who LEASES PERSONAL PROPERTIES.
Senate Bill 1630 deleted Sec. 99 to give way for a new
Section 99—DEFINITION OF TERMS—where eleven (11)
terms were defined. A new Section, Section 99-A was
incorporated which included as subject to VAT, one who sells,
exchanges, barters PROPERTIES and one who imports
PROPERTIES.
The BCC version (R.A. 7716) makes LESSORS of goods
OR PROPERTIES and importers of goods LIABLE to VAT.
II On Section 100 (VAT on sale of goods)
A. The H.B., S.B., and the BCC (R.A. 7716) all included
sale of PROPERTIES as subject to VAT.
The term GOODS or PROPERTIES includes the following:
HB (pls. refer to Sec. 2) SB (pls. refer BCC (RA

to Sec. 1(4) 7716 (Sec. 2)
1. Right or the privilege to use 1. The same 1. The same
patent, copyright, de
________________
2 See also Annex “A,” Memorandum of Petitioner Kilosbayan in

G.R. No. 115781; also the Petition in G.R. No. 115543, pp. 2-3.
807
VOL. 235, AUGUST 25, 1994 807

sign, or model, plan,

secret formula or
process, goodwill
trademark, tradebrand
or other like property or
right.
2. Right or the privilege 2. 2. The same
to use in the Philippines The
of any industrial, same
commercial, or scientific
equipment.
3. Right or the privilege 3. 3. The same
to use motion picture The
films, films, tapes and same
discs.
4. Radio and Television 4. 4. In addition to radio and
time The television time the
Same following were included:
SATELLITE
TRANSMISSION and
CABLE TELEVISION
TIME
5. Other Similar 5. 5. ‘Other similar properties’
properties The was deleted
Same
6.— 6.— 6. Real properties held
primarily for sale to
customers or held for lease
in the ordinary course or
business
B. The HB and the BCC Bills has each a provision which

includes THE SALE OF GOLD TO BANGKO
SENTRAL NG PILIPINAS as falling under the term
Export Sales, hence subject to 0% VAT. The Senate
Bill does not contain such provision (See Section 102-
A thereof).
III. On Section 102

This section was amended to include as subject to a 10% VAT
the gross receipts derived from THE SALE OR EXCHANGE
OF SERVICES, INCLUDING THE USE OR LEASE OF
PROPERTIES.
The SB, HB, and BCC have the same provisions on this.
However, on what are included in the term SALE OR
EXCHANGE OF SERVICES, the BCC included/inserted the
following (not found in either the House or Senate Bills):
1. Services of lessors of property WHETHER

PERSONAL OR REAL; (See BCC Report/Bill p. 7)
2. WAREHOUSING SERVICES (Ibid.,)
808

3. Keepers of RESTHOUSES, PENSION HOUSES,

INNS, RESORTS (Ibid.,)
4. Common carriers by LAND, AIR AND SEA (Ibid.,)
5. SERVICES OF FRANCHISE GRANTEES OF
TELEPHONE AND TELEGRAPH;
6. RADIO AND TELEVISION BROADCASTING
7. ALL OTHER FRANCHISE GRANTEES EXCEPT
THOSE UNDER SECTION 117 OF THIS CODE
8. SERVICES OF SURETY, FIDELITY, INDEMNITY,
AND BONDING COMPANIES.
9. Also inserted by the BCC (on page B thereof) is the
LEASE OR USE OF OR THE RIGHT TO USE OF
SATTELITE TRANSMISSION AND CABLE
TELEVISION TIME
IV. On Section 103 (Exempt Transactions)
The BCC deleted subsection (f) in its entirety, despite its

retention in both the House and Senate Bills, thus under RA
7716, the ‘printing, publication, importation or sale of books
and any newspaper, magazine, review, or bulletin which
appears at regular intervals with fixed prices for subscription
and sale and which is not devoted principally to the
publication of advertisements’ is subject to VAT.
Subsection (g) was amended by the BCC (both Senate and
House Bills did not) by changing the word TEN to FIVE,
thus: “Importation of passenger and/or cargo vessel of more
than five thousand ton to ocean going, including engine and
spare parts of said vessel to be used by the importer himself
as operator thereof.” In short, importation of vessels with
tonnage of more than 5 thousand is VAT exempt.
Subsection L, was amended by the BCC by adding the
qualifying phrase: EXCEPT THOSE RENDERED BY
PROFESSIONALS.
Subsection U which exempts from VAT “Transactions
which are exempt under special laws,” was amended by BCC
by adding the phrase: EXCEPT THOSE GRANTED UNDER
PD Nos. 66, 529, 972, 1491, and 1590, and NON-ELECTRIC
COOPERATIVES under RA 6938. This is the reason why
cooperatives are now subject to VAT.
While the SALE OF REAL PROPERTIES was included in
the exempt transactions under the House Bill, the BCC made
a qualification by stating:
‘(S) SALE OF REAL PROPERTIES NOT PRIMARILY HELD FOR

SALE TO CUSTOMERS OR HELD FOR LEASE IN THE
ORDINARY COURSE OF TRADE OR BUSINESS OR REAL
PROPERTY UTILIZED FOR LOW-COST AND SOCIALIZED
HOUSING AS DEFINED BY R.A. NO. 7279 OTHERWISE
KNOWN AS THE URBAN DEVELOPMENT AND
809
VOL. 235, AUGUST 25, 1994 809

HOUSING ACT OF 1992 AND OTHER RELATED LAWS.

Under the Senate Bill, the sale of real property utilized for low-cost
and socialized housing as defined by RA 7279, is one of the exempt
transactions.
Under the House Bill, also exempt from VAT, is the SALE OF
PROPERTIES OTHER THAN THE TRANSACTIONS
MENTIONED IN THE FOREGOING PARAGRAPHS WITH A
GROSS ANNUAL SALES AND/OR RECEIPTS OF WHICH DOES
NOT EXCEED THE AMOUNT PRESCRIBED IN THE
REGULATIONS TO BE PROMULGATED BY THE SECRETARY
OF FINANCE WHICH SHALL NOT BE LESS THAN P350,000.00
OR HIGHER THAN P600,000.00 x x x Under the Senate Bill, the
amount is P240,000.00. The BCC agreed at the amount of not less
than P480,000.00 or more than P720,000.00 SUBJECT TO TAX
UNDER SEC. 112 OF THIS CODE.
The BCC did not include, as VAT exempt, the sale or transfer of
securities as defined in the Revised Securities Act (BP 178) which
was contained in both Senate and House Bills.
V On Section 104
The phrase INCLUDING PACKAGING MATERIALS was

included by the BCC on Section 104 (A) (1) (B), and the
phrase ON WHICH A VALUE-ADDED TAX HAS BEEN
ACTUALLY on Section 104 (A) (2). These phrases are not
contained in either House and Senate Bills.
VI On Section 107
Both House and Senate Bills provide for the payment of

P500.00 VAT registration fee. The BCC provides for
P1,000.00 VAT fee.
VII On Section 112
While both the Senate and House Bills provide that a

person whose sales or receipts and are exempt under Section
103[w] of the Code, and who are not VAT registered shall pay
a tax equivalent to THREE (3) PERCENT of his gross
quarterly sales or receipts, the BCC inserted the phrase:
THREE PERCENT UPON THE EFFECTIVITY OF THIS
ACT AND FOUR PERCENT (4%) TWO YEARS
THEREAFTER.
810
VIII On Section 115
Sec. 17 of SB 1630, Sec. 12 of House Bill 11197 amends this

Section by clarifying that common carriers by land, air or
water FOR THE TRANSPORT OF PASSENGERS are
subject to Percentage Tax equivalent to 3% of their quarterly
gross sales.
The BCC adopted this and the House Bill’s provision that
the GROSS RECEIPTS OF COMMON CARRIERS
DERIVED FROM THEIR INCOMING AND OUTGOING
FREIGHT SHALL NOT BE SUBJECTED TO THE LOCAL
TAXES IMPOSED UNDER RA 7160. The Senate Bill has no
similar provision.
IX On Section 117
This Section has not been touched by either Senate and

House Bills. But the BCC amended it by subjecting
franchises on ELECTRIC, GAS and WATER UTILITIES A
TAX OF TWO PERCENT (2%) ON GROSS RECEIPTS
DERIVED x x x.
X On Section 121
The BCC adopted the Senate Bills’ amendment to this

section by subjecting to 5% premium tax on life insurance
business. The House Bill does not contain this provision.
XI Others
A) The House Bill does not contain any provision on the

deferment of VAT collection on Certain Goods and
Services as does the Senate Bill (Section 19, SB
1630). But although the Senate Bill authorizes the
deferment on certain goods and services for no longer
than 3 years, there is no specific provision that
authorizes the President to EXCLUDE from VAT any
of these. The BCC uses the word EXCLUDE.
B) Moreover, the Senate Bill defers the VAT on services
of actors and actresses etc. for 3 years but the BCC
defers it for only 2 years.
C) Section 18 of the BCC Bill (RA 7716) is an entirely
new provision not contained in the House/Senate
Bills.
D) The period within which to promulgate the
implementing rules and regulations is within 60 days
under SB 1630; No specific period under the House
Bill, within 90 days under RA 7716 (BCC).
E) The House Bill provides for a general repealing
clause i.e., all inconsistent laws etc. are repealed.
Section 16 of the Senate Bill expressly repeals
Sections 113, 114, 116, 119 and 120 of the code. The
same Senate Bill however contains a general
repealing clause in Sec. 21
811
VOL. 235, AUGUST 25, 1994 811

thereof.
RA 7716 (BCC’s Bill) expressly repeals Sections 113, 114

and 116 of the NIRC; Article 39 (c) (d) and (e) of EO 226 and
provides the repeal of Sec. 119 and 120 of the NIRC upon the
expiration of two (2) years unless otherwise excluded by the
President.”
The charge that the Bicameral Conference Committee

added new provisions in the bills of the two chambers
is hardly disputed by respondents. Instead,
respondents justify them. According to respondents: (1)
the Bicameral Conference Committee has an ex post
veto power or a veto after the fact of approval of the
bill by both Houses; (2) the bill prepared by the
Bicameral Conference Committee, with its additions
and deletions, was anyway approved by both Houses;
(3) it was the practice in past Congresses for
conference committees to insert in bills approved by
the two Houses new provisions that were not originally
contemplated by them; and (4) the enrolled bill
doctrine precludes inquiry into the regularity of the
proceedings that led to the enactment of R.A. 7716.
With due respect, I reject these contentions which
will cave in on closer examination.
First. There is absolutely no legal warrant for the
bold submission that a Bicameral Conference
Committee possesses the power to add/delete
provisions in bills already approved on third reading
by both Houses or an ex post veto power. To support
this postulate that can enfeeble Congress itself,
respondents cite no constitutional
3
provision, no law,
not even any rule or regulation. Worse, their stance is
categorically repudiated by the rules of both the Senate
and the House of Representatives which define with
precision the parameters of power of a Bicameral
Thus, Section 209, Rule XII of the Rules of the
Senate provides:
“In the event that the Senate does not agree with the House
of Representatives on the provision of any bill or joint
resolution, the differences shall be settled by a conference
committee of both Houses
_______________
3 See p. 66 of the Consolidated Memorandum for Respondents where they

refer to certain statements from Canlan, Weightson and Beam but without
citing their specific book or article.
812

which shall meet within ten days after their composition.

or amendments to the subject measure, and shall be signed
by the conferees.” (Emphasis supplied)
The counterpart rule of the House of Representatives

is cast in near identical language. Section 85 of the
Rules of the House of Representatives pertinently
provides:
“In the event that the House does not agree with the Senate on
the amendments to any bill or joint resolution, the differences
may be settled by a conference committee of both chambers.
x x x. Each report shall contain a detailed, sufficiently
explicit statement of the changes in or amendments to the
subject measure.” (Emphasis supplied)
4
The Jefferson’s Manual has been adopted as a
supplement to our parliamentary rules and practice.
Section 456 of Jefferson’s Manual similarly
5
confines
the powers of a conference committee, viz:
“The managers of a conference must confine themselves to

the differences committed to them . . . and may not include
subjects not within the disagreements, even though germane
to a question in issue.”
This rule of antiquity has been honed and honored in

practice by the Congress of the United States. Thus, it
is chronicled by Floyd Biddick, Parliamentarian
6
Emeritus of the United States Senate, viz:
“Committees of conference are appointed for the sole purpose

of compromising and adjusting the differing and conflicting
opinions of the two Houses and the committees of conference
alone can grant
________________
4 See Rule 49 of the Rules of the Senate.

5 See p. 22, Memorandum of Petitioners in G.R. No. 115781 citing
Jefferson’s Manual and Rules of the House of Representatives, by Lewis
Deschler, Parliamentarian, U.S. Government Printing Office, 1967, p. 264.
6 Ibid, citing Riddick, Senate Procedure: Precedents and Practices, US
Senate, 1981, US Government Printing Office, pp. 383-384.
813
VOL. 235, AUGUST 25, 1994 813

compromises and modify propositions of either Houses within

the limits of the disagreement. Conferees are limited to the
consideration of differences between the two Houses.
Conferees shall not insert in their report matters not
committed to them by either House, nor shall they strike from
the bill matters agreed to by both Houses. No matter on which
there is nothing in either the Senate or House passed
versions of a bill may be included in the conference report
and actions to the contrary would subject the report to a
point of order.” (Emphasis ours)
In fine, there is neither a sound nor a syllable in the

Rules of the Senate and the House of Representatives
to support the thesis of the respondents that a
bicameral conference committee is clothed with an ex
post veto power.
But the thesis that a Bicameral Conference
Committee can wield ex post veto power does not only
contravene the rules of both the Senate and the House.
It wages war against our settled ideals of
representative democracy. For the inevitable,
catastrophic effect of the thesis is to install a
Bicameral Conference Committee as the Third
Chamber of our Congress, similarly vested with the
power to make laws but with the dissimilarity that its
laws are not the subject of a free and full discussion of
both Houses of Congress. With such a vagrant power, a
Bicameral Conference Committee acting as a Third
Chamber will be a constitutional monstrosity.
It needs no omniscience to perceive that our
Constitution did not provide for a Congress composed
of three chambers. On the contrary, section 1, Article
VI of the Constitution provides in clear and certain
language: “The legislative power shall be vested in the
Congress of the Philippines which shall consist of a
Senate and a House of Representatives . . . .” Note that
in vesting legislative power exclusively to the Senate
and the House, the Constitution used the word “shall.”
Its command for a Congress of two houses is
mandatory. It is not mandatory sometimes.
In vesting legislative power to the Senate, the
Constitution means the Senate “. . . composed of
twenty-four Senators x x x elected at large 7
by the
qualified voters of the Philippines . . . .” Similarly,
when the Constitution vested the legislative power to
________________
7 Section 2, Article VI.
814

the House, it means the House “. . . composed of not

more than two hundred and fifty members x x x who
shall be elected from legislative districts x x x and
those who x x x shall be elected through a party-list
system of registered national,
8
regional, and sectoral
parties or organizations.” The Constitution thus, did
not vest on a Bicameral Conference Committee with an
ad hoc membership the power to legislate for it
exclusively vested legislative power to the Senate and
the House as co-equal bodies. To be sure, the
Constitution does not mention the Bicameral
Conference Committees of Congress. No constitutional
status is accorded to them. They are not even statutory
creations. They owe their existence from the internal
rules of the two Houses of Congress. Yet, respondents
peddle the disconcerting idea that they should be
recognized as a Third Chamber of Congress and with
ex post veto power at that.
The thesis that a Bicameral Conference Committee
can exercise law making power with ex post veto power
is freighted with mischief. Law making his a power
that can be used for good or for ill, hence, our
Constitution carefully laid out a plan and a procedure
for its exercise. Firstly, it vouchsafed that the power to
make laws should be exercised by no other body except
the Senate and the House. It ought to be indubitable
that what is contemplated is the Senate acting as a full
Senate and the House acting as a full House. It is only
when the Senate and the House act as whole bodies
that they truly represent the people. And it is only
when they represent the people that they can
legitimately pass laws. Laws that are not enacted by
the people’s rightful representatives subvert the
people’s sovereignty. Bicameral Conference
Committees, with their ad hoc character and limited
membership, cannot pass laws for they do not
represent the people. The Constitution does not allow
the tyranny of the majority. Yet, the respondents will
impose the worst kind of tyranny—the tyranny of the
minority over the majority. Secondly, the Constitution
delineated in deft strokes the steps to be followed in
making laws. The overriding purpose of these
procedural rules is to assure that only bills that
successfully survive the searching scrutiny of the
proper committees of Congress and the full and
________________
8 Section 5(1), Article VI.
815
VOL. 235, AUGUST 25, 1994 815

unfettered deliberations of both Houses can become
laws. For this reason, a bill has to undergo three (3)
mandatory separate readings in each House. In the
case at bench, the additions and deletions made by the
Bicameral Conference Committee did not enjoy the
enlightened studies of appropriate committees. It is
meet to note that the complexities of modern day
legislations have made our committee system a
significant part of the legislative process. Thomas Reed
called the committee system as “the eye, the ear, the
hand, and very often the brain of the house.” President
Woodrow Wilson of the United States once referred to
the government of the United States as “a government
by the Chairmen9 of the Standing Committees of
Congress . . . .” Neither did these additions and
deletions of the Bicameral Conference Committee pass
through the coils of collective deliberation of the
members of the two Houses acting separately. Due to
this shortcircuiting of the constitutional procedure of
making laws, confusion shrouds the enactment of R.A.
No. 7716. Who inserted the additions and deletions
remains a mystery. Why they were inserted is a riddle.
To use a Churchillian phrase, lawmaking should not be
a riddle wrapped in an enigma. It cannot be, for Article
II, section 28 of the Constitution mandates the State to
adopt and implement a “policy of full public disclosure
of all its transactions involving public interest.” The
Constitution could not have contemplated a Congress
of invisible and unaccountable John and Mary Does. A
law whose rationale is a riddle and whose authorship
is obscure cannot bind the people.
All these notwithstanding, respondents resort to the
legal cosmetology that these additions and deletions
should govern the people as laws because the
Bicameral Conference Committee Report was anyway
submitted to and approved by the Senate and the
House of Representatives. The submission may have
some merit with respect to provisions agreed upon by
the Committee in the process of reconciling conflicts
between S.B. No. 1630 and H.B. No. 11197. In these
instances, the conflicting provisions had been
previously screened by the proper committees,
deliberated upon by both Houses and approved by
them. It is, however, a different matter with respect to
additions and deletions
________________
9 Sutherland, Statutory Construction, 3rd ed., Vol. I, p. 151.
816

which were entirely new and which were made not to

reconcile inconsistencies between S.B. No. 1630 and
H.B. No. 11197. The members of the Bicameral
Conference Committee did not have any authority to
add new provisions or delete provisions already
approved by both Houses as it was not necessary to
discharge their limited task of reconciling differences
in bills. At that late stage of law making, the
Conference Committee cannot add/ delete provisions
which can become laws without undergoing the study
and deliberation of both chambers given to bills on 1st,
2nd, and 3rd readings. Even the Senate and the House
cannot enact a law which will not undergo these
mandatory three (3) readings required by the
Constitution. If the Senate and the House cannot enact
such a law, neither can the lesser Bicameral
Moreover, the so-called choice given to the members
of both Houses to either approve or disapprove the said
additions and deletions is more of an optical illusion.
These additions and deletions are not submitted
separately for approval. They are tucked to the entire
bill. The vote is on the bill as a package, i.e., together
with the insertions and deletions. And the vote is
either “aye” or “nay,” without any further debate and
deliberation. Quite often, legislators vote “yes” because
they approve of the bill as a whole although they may
object to its amendments by the Conference
Committee. This
10
lack of real choice is well observed by
Robert Luce:
“Their power lies chiefly in the fact that reports of conference

committees must be accepted without amendment or else
rejected in toto. The impulse is to get done with the matter
and so the motion to accept has undue advantage, for some
members are sure to prefer swallowing unpalatable
provisions rather than prolong controversy. This is the more
likely if the report comes in the rush of business toward the
end of a session, when to seek further conference might
result in the loss of the measure altogether. At any time in
the session there is some risk of such a result following the
rejection of a conference report, for it may not be possible to
secure a second conference, or delay may give opposition to
the main proposal chance to develop more strength.”
________________
10 Legislative Procedure, 1922 ed., Riverside Press, p. 404.
817
VOL. 235, AUGUST 25, 1994 817

In a similar vein, Prof. Jack Davies commented that

“conference reports are returned to assembly and
Senate on a take-it or leave-it-basis, and the bodies are
generally placed in the 11position that to leave-it is a
practical impossibility.” Thus, he concludes that
“conference committee action is the most
12
undemocratic
procedure in the legislative process.”
The respondents also contend that the additions and
deletions made by the Bicameral Conference
Committee were in accord with legislative customs and
usages. The argument does not persuade for it
misappreciates the value of customs and usages in the
hierarchy of sources of legislative rules of procedure.
To be sure, every legislative assembly has the inherent
right to promulgate its own internal rules. In our
jurisdiction, Article VI, section 16(3) of the
Constitution provides that “Each House may
determine the rules of its proceedings x x x.” But it is
hornbook law that the sources of Rules of Procedure
are many and hierarchical
13
in character. Mason laid
them down as follows:
“x x x
1. Rules of Procedure are derived from several sources.

The principal sources are as follows:
a. Constitutional rules.
b. Statutory rules or charter provisions.
c. Adopted rules.
d. Judicial decisions.
e. Adopted parliamentary authority.
f. Parliamentary law.
g. Customs and usages.
2. The rules from the different sources take precedence in

the order listed above except that judicial decisions,
since they are interpretations of rules from one of the
other sources, take the same precedence as the source
interpreted. Thus, for example, an interpretation of a
constitutional provision takes precedence over a
statute.
3. Whenever there is conflict between rules from these
sources the rule from the source listed earlier prevails
over the rule from the source
_______________
11 Legislative Law and Process in a Nut Shell, West Publishing Co., 1986
ed., p. 81.
12 Ibid.
13 Manual of Legislative Procedure for Legislative and other
Governmental Bodies, McGraw Hill Co., Inc., 1953 ed., pp. 32-33.
818

listed, later. Thus, where the Constitution requires

three readings of bills, this provision controls over
any provision of statute, adopted rules, adopted
manual, or of parliamentary law, and a rule of
parliamentary law controls over a local usage but
must give way to any rule from a higher source of
authority.” (Emphasis ours)
As discussed above, the unauthorized additions and

deletions made by the Bicameral Conference
Committee violated the procedure fixed by the
Constitution in the making of laws. It is reasonless for
respondents therefore to justify these insertions as
sanctioned by customs and usages.
Finally, respondents seek sanctuary in the
conclusiveness of an enrolled bill to bar any judicial
inquiry on whether Congress observed our
constitutional procedure in the passage of R.A. No.
7716. The enrolled bill theory is a historical relic that
should not continuously rule us from the fossilized
past. It should be immediately emphasized that the
enrolled bill theory originated in England where there
is no written
14
constitution and where Parliament is
supreme. In this jurisdiction, we have a written
constitution and the legislature is a body of limited
powers. Likewise, it must be pointed out that starting
from the decade of the 40’s, even American courts have
veered away from the rigidity and unrealism of the
conclusiveness
15
of an enrolled bill. Prof. Sutherland
observed:
“x x x.
Where the failure of constitutional compliance in the
enactment of statutes is not discoverable from the face of the
act itself but may be demonstrated by recourse to the
legislative journals, debates, committee reports or papers of
the governor, courts have used several conflicting theories
with which to dispose of the issue. They have held: (1) that
the enrolled bill is conclusive and like the sheriff’s return
cannot be attacked; (2) that the enrolled bill is prima facie
correct and only in case the legislative journal shows
affirmative contradiction of the constitutional requirement
will the bill be held invalid, (3) that although the enrolled bill
is prima facie correct, evidence from the journals, or other
extrinsic sources is admissible to strike the bill down; (4) that
the legislative journal is conclusive and the enrolled bill is
valid only if it
_______________
14 82 CJS 136.
15 Statutory Construction, 3rd ed., Vol. I., p. 223.
819
VOL. 235, AUGUST 25, 1994 819

accords with the recital in the journal and the constitutional

procedure.”
Various jurisdictions have adopted these alternative

approaches in view of strong dissent and
dissatisfaction against the philosophical underpinnings
of the conclusiveness of an enrolled bill. Prof.
Sutherland further observed:
“x x x Numerous reasons have been given for this rule.

Traditionally, an enrolled bill was ‘a record’ and as such was
not subject to attack at common law. Likewise, the rule of
conclusiveness was similar to the common law rule of the
inviolability of the sheriff’s return. Indeed, they had the
same origin, that is, the sheriff was an officer of the king and
likewise the parliamentary act was a regal act and no official
might dispute the king’s word. Transposed to our democratic
system of government, courts held that as the legislature was
an official branch of government the court must indulge
every presumption that the legislative act was valid. The
doctrine of separation of powers was advanced as a strong
reason why the court should treat the acts of a co-ordinate
branch of government with the same respect as it treats the
action of its own officers; indeed, it was thought that it was
entitled to even greater respect, else the court might be in
the position of reviewing the work of a supposedly equal
branch of government. When these arguments failed, as they
frequently did, the doctrine of convenience was advanced,
that is, that it was not only an undue burden upon the
legislature to preserve its records to meet the attack of
persons not affected by the procedure of enactment, but also
that it unnecessarily complicated litigation and confused the
trial of substantive issues.
Although many of these arguments are persuasive and are
indeed the basis for the rule in many states today, they are
not invulnerable to attack. The rule most relied on—the
sheriff’s return or sworn official rule—did not in civil
litigation deprive the injured party of an action, for always
he could sue the sheriff upon his official bond. Likewise,
although collateral attack was not permitted, direct attack
permitted raising the issue of fraud, and at a later date
attack in equity was also available; and that the evidence of
the sheriff was not of unusual weight was demonstrated by
the fact that in an action against the sheriff no presumption
of its authenticity prevailed.
The argument that the enrolled bill is a ‘record’ and
therefore unimpeachable is likewise misleading, for the
correction of records is a matter of established judicial
procedure. Apparently, the justification is either the
historical one that the king’s word could not be questioned or
the separation of powers principle that one branch of the
government must treat as valid the acts of another.
820
Persuasive as these arguments are, the tendency today is to

avoid reaching results by artificial presumptions and thus it
would seem desirable to insist that the enrolled bill stand or
fall on the basis of the relevant evidence which may be
submitted for or against it.” (Emphasis ours)
Thus, as far back as the 1940’s, Prof. Sutherland

confirmed that “x x x the tendency seems to be toward
the abandonment of the conclusive presumption rule
and the adoption of the third rule leaving only a prima
facie presumption of validity which may 16be attacked by
any authoritative source of information.”
I am not unaware that this Court has subscribed to
the conclusiveness of an enrolled bill as enunciated in
the 1947 lead case of Mabanag 17
v. Lopez Vito, and
reiterated in subsequent cases.
With due respect, I submit that these rulings are no
longer good law. Part of the ratiocination in Mabanag
states:
“x x x.
If for no other reason than that it conforms to the
expressed policy of our law making body, we choose to follow
the rule. Section 313 of the old Code of Civil Procedure, as
amended by Act No. 2210, provides: ‘Official documents’ may
be proved as follows: * * * (2) the proceedings of the
Philippine Commission, or of any legislative body that may
be provided for in the Philippine Islands, or of Congress, by
the journals of those bodies or of either house thereof, or by
published statutes or resolutions, or by copies certified by the
clerk or secretary, or printed by their order; Provided, That
in the case of Acts of the Philippine Commission or the
Philippine Legislature, when there is an existence of a copy
signed by the presiding officers and secretaries of said bodies,
it shall be conclusive proof of the provisions of such Acts and
of the due enactment thereof.”
________________
16 Op. cit., pp. 224-225 citing Barndall Refining v. Welsh, 64 S.D.

647, 269 N.W. 853, 859 [1936]. Jones, Constitutional Provisions
Regulating the Mechanics of Enactment in Iowa (1935), 21 Iowa Law
Rev. 79, Charlton, Constitutional Regulation of Legislative
Procedure (1936), 21 Iowa Law Rev. 538; Note (1936) 21 Iowa Law
Rev. 573.
17 See Mabanag v. Lopez Vito, 78 Phil. Rep. 1 [1947]; Casco Phil.
Chemical Co. v. Gimenez, L-17931, February 28, 1963; Morales v.
Subido, No. L-29658, February 27, 1969, 27 SCRA 131; Phil. Judges
Association v. Prado, G.R. No. 105371, November 11, 1993.
821
VOL. 235, AUGUST 25, 1994 821

Suffice to state that section 313 of the Old Code of Civil

Procedure as amended by Act No. 2210 is no longer in
our statute books. It has long been repealed by the
Rules of Court. Mabanag also relied on jurisprudence
and authorities in the United States which are under
severe criticisms by modern scholars. Hence, even in
the United States the conclusiveness of an enrolled bill
has been junked by most of the States. It is also true
that as late as last year, in the case of Philippine
Judges Association v. Prado, op. cit., this Court still
relied on the conclusiveness of an enrolled bill as it
refused to invalidate a provision of law on the ground
that it was merely inserted by the bicameral
conference committee of both Houses. Prado, however,
is distinguishable. In Prado, the alleged insertion of
the second paragraph of section 35 of R.A. No. 7354
repealing the franking privilege of the judiciary does
not appear to be an uncontested fact. In the case at
bench, the numerous additions/deletions made by the
Bicameral Conference Committee as detailed by
petitioners Tolentino and Salonga are not disputed by
the respondents. In Prado, the Court was not also
confronted with the argument that it can no longer rely
on the conclusiveness of an enrolled bill in light of the
new provision in the Constitution defining judicial
power. More specifically, section 1 of Article VIII now
provides:
“Section 1. The judicial power shall be vested in one Supreme

Court and in such lower courts as may be established by law.
Judicial power includes the duty of the courts of justice to
settle actual controversies involving rights which are legally
demandable and enforceable, and to determine whether or not
there has been a grave abuse of discretion amounting to lack
or excess of jurisdiction on the part of any branch or
instrumentality of the Government.” (Emphasis supplied)
Former Chief Justice Roberto R. Concepcion, the

sponsor of this provision in the Constitutional
Commission explained the 18
sense and the reach of
judicial power as follows:
_______________
18 Record, Constitutional Commission, Vol. I, p. 436; see also,

Bernas, The Constitution of the Republic of the Philippines. A
Commentary, 1988 ed., p. 255.
822

“x x x.
x x x In other words, the judiciary is the final arbiter on
the question of whether or not a branch of government or any
of its officials has acted without jurisdiction or in excess of
jurisdiction, or so capriciously as to constitute an abuse of
discretion amounting to excess of jurisdiction. This is not
only a judicial power but a duty to pass judgment on matters
of this nature.
This is the background of paragraph 2 of Section 1, which
means that the courts cannot hereafter evade the duty to settle
matters of this nature, by claiming that such matters
constitute political question.” (Emphasis ours)
The Constitution cannot be any clearer. What it

granted to this Court is not a mere power which it can
decline to exercise. Precisely to deter this
disinclination, the Constitution imposed it as a duty of
this Court to strike down any act of a branch or
instrumentality of government or any of its officials
done with grave abuse of discretion amounting to lack
or excess of jurisdiction. Rightly or wrongly, the
Constitution has elongated the checking powers of this
Court against the other branches of government
despite their more democratic character, the President
and the legislators being elected by the people. It is, 19
however, theorized that this provision is nothing new.
I beg to disagree for the view misses the significant
changes made in our constitutional canvass to cure the
legal deficiencies we discovered during martial law.
One of the areas radically changed by the framers of
the 1987 Constitution is the imbalance of power
between and among the three great branches of our
government—the Executive, the Legislative and the
Judiciary. To upgrade the powers of the Judiciary, the
Constitutional Commission strengthened some more
the independence of courts. Thus, it further protected
the security of tenure of the members of the Judiciary
by providing “No law shall be passed reorganizing the
Judiciary when 20
it undermines the security of tenure of
its Members.”21 It also guaranteed fiscal autonomy to
the Judiciary.
More, it depoliticalized appointments in the
judiciary by creating the Judicial and Bar Council
which was tasked with
_______________
19 Citing Marbury v. Madison, 1 Cranch 137 L. ed [1803].

20 Article VIII, section 2.
823
VOL. 235, AUGUST 25, 1994 823

screening22 the list of prospective appointees to the

judiciary. The power of confirming appointments 23
to
the judiciary was also taken away from Congress. The
President was likewise given a specific time to fill up
vacancies in the judiciary—ninety (90) days from the
occurrence
24
of the vacancy in case of the Supreme
Court and ninety (90) days from the submission of the
list of recommendees by the Judicial and25Bar Council
in case of vacancies in the lower courts. To further
insulate appointments in the judiciary from the virus
of politics, the Supreme Court was given the power to
“appoint all officials and employees of the
26
Judiciary in
accordance with the Civil Service Law.” And to make
the separation of the judiciary from the other branches
of government more watertight, it prohibited members
of the judiciary to be “. . . designated to any agency
performing27 quasi judicial or administrative
functions.” While the Constitution strengthened the
sinews of the Supreme Court, it reduced the powers of
the two other branches of government, especially the
Executive. Notable of the powers of the President
clipped by the Constitution is his power to suspend the
writ of habeas corpus and to proclaim martial law. The
exercise of this power is now subject to revocation by
Congress. Likewise, the sufficiency of the factual basis
for the exercise of said power may be reviewed by this
Court 28in an appropriate proceeding filed by any
citizen.
The provision defining judicial power as including
the “duty of the courts of justice . . . to determine
whether or not there has been a grave abuse of
discretion amounting to lack or excess of jurisdiction
on the part of any branch or instrumentality of the
Government” constitutes the capstone of the efforts of
the Constitutional Commission to upgrade the powers
of this Court vis-a-vis the other branches of
government. This provision was dictated by our
experience under martial law which taught us that a
stronger and more independent judiciary is needed to
abort
_______________

24 Article VIII, section 4(1).
28 Article VII, section 18.
824

abuses in government. As sharply stressed by

petitioner Salonga, this provision is distinctly Filipino
and its interpretation should not be depreciated by
undue reliance on inapplicable foreign jurisprudence.
It is thus crystal clear that unlike other Supreme
Courts, this Court has been mandated by our new
Constitution to be a more active agent in annulling
acts of grave abuse of discretion committed by a branch
of government or any of its officials. This new role,
however, will not compel the Court, appropriately
defined by Prof. A. Bickel as the least dangerous
branch of government, to assume imperial powers and
run roughshod over the principle of separation of
power for that is judicial tyranny by any language. But
while respecting the essentials of the principle of
separation of power, the Court is not to be restricted by
its non-essentials. Applied to the case at bench, by
voiding R.A. No. 7716 on the ground that its enactment
violated the procedure imposed by the Constitution in
lawmaking, the Court is not by any means wrecking
the wall separating the powers between the legislature
and the judiciary. For in so doing, the Court is not
engaging in lawmaking which is the essence of
legislative power. But the Court’s interposition of
power should not be defeated by the conclusiveness of
the enrolled bill. A resort to this fiction will result in
the enactment of laws not properly deliberated upon
and passed by Congress. Certainly, the enrolled bill
theory was not conceived to cover up violations of the
constitutional procedure in law making, a procedure
intended to assure the passage of good laws. The
conclusiveness of the enrolled bill can, therefore, be
disregarded for it is not necessary to preserve the
principle of separation of powers.
In sum, I submit that in imposing to this Court the
duty to annul acts of government committed with
grave abuse of discretion, the new Constitution
transformed this Court from passivity to activism. This
transformation, dictated by our distinct experience as a
nation, is not merely evolutionary but revolutionary.
Under the 1935 and 1973 Constitutions, this Court
approached constitutional violations by initially
determining what it cannot do; under the 1987
Constitution, there is a shift in stress—this Court is
mandated to approach constitutional violations not by
finding out what it should not do but what it must do.
The Court must discharge this solemn duty by not
resuscitating a past that petrifies the present.
825
VOL. 235, AUGUST 25, 1994 825

I vote to declare R.A. No. 7716 unconstitutional.

Petitions dismissed.
Notes.—Despite the inhibitions pressing upon the
Court when confronted with constitutional issues, it
will not hesitate to declare a law or act invalid when it
is convinced that this must be done. In arriving at this
conclusion, its only criterion will be the Constitution
and God as its conscience gives it in the light to probe
its meaning and discover its purpose. Personal motives
and political considerations are irrelevancies that
cannot influence its decisions. (Luz Farms vs. Secretary
of the Department of Agrarian Reform, 192 SCRA 51
[1990])
We start with the established principle that the
exclusive nature of any public franchise is not favored.
We may interpret in favor of exclusiveness only when
the statute grants it in express, clear, and
unmistakable terms. In all grants by the government
to private corporations, the interpretation of rights,
privileges, or franchises is taken against the grantee.
Whatever is not clearly and expressly granted is
withheld. (Alger Electric, Inc. vs. Court of Appeals, 135
SCRA 37 [1985])
———o0o———
826
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630 SUPREME COURT REPORTS ANNOTATED

Tolentino vs. Secretary of Finance

ARTURO M. TOLENTINO, petitioner, vs. THE

JUAN T. DAVID, petitioner, vs. TEOFISTO T.

RAUL S. ROCO and the INTEGRATED BAR OF THE

VOL. 235, AUGUST 25, 1994 631

G.R. No. 115544. August 25, 1994.*

PHILIPPINE PRESS INSTITUTE, INC.; EGP

G.R. No. 115754. August 25, 1994.*

CHAMBER OF REAL ESTATE AND BUILDERS

G.R. No. 115781. August 25, 1994.*

KILOSBAYAN, INC., JOVITO R. SALONGA, CIRILO

G.R. No. 115852. August 25, 1994.*

PHILIPPINE AIRLINES, INC. petitioner, vs. THE

632 SUPREME COURT REPORTS ANNOTATED

G.R. No. 115873. August 25, 1994.*

COOPERATIVE UNION OF THE PHILIPPINES,

G.R. No. 115931. August 25, 1994.*

PHILIPPINE EDUCATIONAL PUBLISHERS

VOL. 235, AUGUST 25, 1994 633

Tolentino vs. Secretary of Finance

note is that, as a result of the Senate action, a distinct bill

634 SUPREME COURT REPORTS ANNOTATED

Tolentino vs. Secretary of Finance

must come from the House of Representatives and that it does

VOL. 235, AUGUST 25, 1994 635

Tolentino vs. Secretary of Finance

Same; Same; Judicial Review; While the sufficiency of the

636 SUPREME COURT REPORTS ANNOTATED

Tolentino vs. Secretary of Finance

which being that the third version be germane to the subject

VOL. 235, AUGUST 25, 1994 637

Tolentino vs. Secretary of Finance

16(3) of the Constitution provides that “Each House may

Tolentino vs. Secretary of Finance

Same; Same; Same; Same; Enrolled Bill Doctrine; An

VOL. 235, AUGUST 25, 1994 639

Tolentino vs. Secretary of Finance

mentioned in the title of the law, in addition to § 103 of the

640 SUPREME COURT REPORTS ANNOTATED

Tolentino vs. Secretary of Finance

VOL. 235, AUGUST 25, 1994 641

Tolentino vs. Secretary of Finance

fixed amount (P1,000), is not imposed for the exercise of a

642 SUPREME COURT REPORTS ANNOTATED

Tolentino vs. Secretary of Finance

is not a negative standard for courts to enforce. What

VOL. 235, AUGUST 25, 1994 643

Tolentino vs. Secretary of Finance

concrete record. We accept that this Court does not only

NARVASA, C.J., Separate Opinion:

Constitutional Law; Statutes; Origin of Revenue Bills;

644 SUPREME COURT REPORTS ANNOTATED

Tolentino vs. Secretary of Finance

to effectively lead to the enactment of a statute. Until this

VOL. 235, AUGUST 25, 1994 645

Tolentino vs. Secretary of Finance

pointed out, there is no proof worthy of the name of any facts

CRUZ, J., Separate Opinion:

Constitutional Law; Judicial Review; Where a specific

646 SUPREME COURT REPORTS ANNOTATED

Tolentino vs. Secretary of Finance

matter closed.—I am persuaded even now that where a