CA reverses Ombudsman decision suspending Capitol employee

The Court of Appeals (CA) has reversed a decision of the Ombudsman ordering the one year suspension of a Capitol employee over a tax collection case involving Pilipinas Kao Inc. (PKI).

In a 13- page decision penned by Associate Justice Ruben Reynaldo Roxas, the Appellate Court also granted the petition for review filed by Marilou Rivera, the acting provincial accountant of Misamis Oriental provincial government.

The petition stems from the complaint for abuse of authority, gross neglect of duty and misconduct filed last August 25, 2015 by the Ombudsman.

The case delved on Rivera’s alleged unauthorized issuance of two warrants of garnishment upon the BPI bank deposits of PKI, a Philippine Economic Zone Authority (PEZA) registered Japanese company operating in Jasaan, Misamis Oriental.

“There being no showing, much more, finding that petitioner acted in bad faith or malice in garnishing BPI accounts involved in the instance case, the ascription of oppression against her, in the light of jurisprudence, must fail,” the CA order said.

“The petition for review is granted. The decision dated August 15, 2016 and order dated 29 November 2016 of respondent ombudsman are hereby reversed and set aside,” the order reads.

Rivera was suspended for one year after she was found guilty by the Ombudsman of the charges filed by Pilipinas Kao Inc. (PKI), a company that supplies high quality and biodegradable chemical products from coconut oil in both local and international markets.

Based on investigation by the Ombudsman, the Provincial Government had assessed the company’s unpaid real property taxes for 11 years from 2002 to 2013 in the total amount

of P631.5 million.

Procolo Olaivar, manager of the Philippine Economic Zone Authority (Peza), sent a letter on September 26, 2013, citing PKI’s exemption from paying local taxes, including real property taxes since it is covered by the Special Economic Zone Act or the Republic Act (RA) 7916.

The Philippine government declared the whole plant site in the tow the town of Jasaan as an economic zone in 2001.

But, Rivera still issued a warrant of levy against PKI in October 2013 in the total amount of P244.7 million and issued warrants of garnishment in January 2014 against the firm’s bank accounts to cover the P631.5 million assessment.

‘Garnishment’ refers to a legal procedure by which a creditor can collect what a debtor owes by reaching the debtor’s property when it is in the hands of someone other than the debtor.

“Respondent’s issuance of the warrant of garnishment against PKI’s bank accounts appear to be improper,” the Ombudsman said. The Ombudsman also explained in its decision that “the records show that the Provincial Government of Misamis Oriental issued 152 warrants of levy on PKI’s properties that were considered as delinquent that could have readily and sufficiently satisfied the purportedly unpaid real property taxes” as “PKI’s industrial machinery alone had a market value of P2.9 billion.”

“Hence, there was no need to freeze PKI’s accounts and hamper its business operations,” the Ombudsman had said.