G.R. No. L-17931 – 7 SCRA 347 – Political Law – Constitutional Law – The Legislative Department – Legislative Process – Journal – Conclusiveness of the Enrolled Bill
Casco Philippine Chemical Co., Inc. (Casco) was engaged in the production of synthetic resin glues used primarily in the production of plywood. The main components of the said glue are urea and formaldehyde which are both being imported abroad. Pursuant to a Central Bank circular, Casco paid the required margin fee for its imported urea and formaldehyde. Casco however paid in protest as it maintained that urea and formaldehyde are tax exempt transactions. The Central Bank agreed and it issued vouchers for refund. The said vouchers were submitted to Pedro Gimenez, the then Auditor General, who denied the tax refund. Gimenez maintained that urea and formaldehyde, as two separate and distinct components are not tax exempt; that what is tax exempt is urea formaldehyde (the synthetic resin formed by combining urea and formaldehyde). Gimenez cited the provision of Sec. 2, par. 18 of Republic Act No. 2609 which provides:
The margin established by the Monetary Board pursuant to the provision of section one hereof shall not be imposed upon the sale of foreign exchange for the importation of the following:
xxx xxx xxx
XVIII. Urea formaldehyde for the manufacture of plywood and hardboard when imported by and for the exclusive use of end-users.
Casco however averred that the term “urea formaldehyde” appearing in this provision should be construed as “urea and formaldehyde”. It further contends that the bill approved in Congress contained the copulative conjunction “and” between the terms “urea” and, “formaldehyde”, and that the members of Congress intended to exempt “urea” and “formaldehyde” separately as essential elements in the manufacture of the synthetic resin glue called “urea formaldehyde”, not the latter a finished product, citing in support of this view the statements made on the floor of the Senate, during the consideration of the bill before said House, by members thereof.
The enrolled bill however used the term “urea formaldehyde”.
ISSUE: Whether or not the term “urea formaldehyde” should be construed as “urea and formaldehyde”.
HELD: No. Urea formaldehyde is not a chemical solution. It is the synthetic resin formed as a condensation product from definite proportions of urea and formaldehyde under certain conditions relating to temperature, acidity, and time of reaction. “Urea formaldehyde” is clearly a finished product, which is patently distinct and different from “urea” and “formaldehyde”, as separate articles used in the manufacture of the synthetic resin known as “urea formaldehyde”.
The opinions or statements of any member of Congress during the deliberation of the said law/bill do not represent the entirety of the Congress itself. What is printed in the enrolled bill would be conclusive upon the courts. The enrolled bill – which uses the term “urea formaldehyde” instead of “urea and formaldehyde” – 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 the bill before it was certified by the officers of Congress and approved by the Executive – on which the SC cannot speculate, without jeopardizing the principle of separation of powers and undermining one of the cornerstones of our democratic system – the remedy is by amendment or curative legislation, not by judicial decree.
