BIR Ruling [DA-190-04]

April 6, 2004 BIR RULING [DA-190-04] UN-231-A-6-27-95 Antonio S. Estrella Block 38, Lot 16 Molave Street, Green Meadows Subdivision Barangay Sto. Nio, Tugbok District Davao City S i r : This refers to the papers you filed with the Personnel Division, BIR National Office bearing on the Resolution of the Office of the President in OP Case No. 99-J-8878 granting your request for executive clemency. Document submitted show that for incurring cash shortage, you were charged with crime of Estafa before the Sandiganbayan in Criminal Case No. 17552; that you entered into a plea bargaining agreement and was sentenced to an indeterminate prison term of six (6) months of Arresto Mayor , as minimum penalty, to five (5) years and two (2) months of Prision Correccional, as the maximum penalty, with the accessory penalties provided for by law; that you were also found guilty of the administrative charge of Dishonesty and Violation of Office Rules and Regulations and was dismissed from the service on April 10, 1995; that you were placed under probation for your conviction of the crime of Malversation of Public Funds and was eventually discharged from the service on August 15, 1995; and that upon recommendation of the Civil Service Commission, you were executive clemency by the Office of the President on May 14, 2003. The issue for resolution before this Office is whether or not you are now entitled to retirement and terminal leave benefits in view of the fact that you have been discharged from your probation and granted executive clemency. In reply, please be informed that after consideration of the facts of the case and the laws applicable thereto, this Office is of the opinion that you are not entitled to your retirement benefits. However, there is no legal impediment to your entitlement to your terminal leave benefits. In the case of MERLINDA JACINTO, ET AL. VS. COURT OF APPEALS, G.R. No. 124540, dated November 14, 1997, the Supreme Court ruled as follows: " Monsanto vs. Factoran Jr . established the general rule that while pardon has been commonly regarded as eliminating the existence of guilt so that in the eyes of the law the offender is as innocent as though he never committed the offense such exoneration does not operate for all purposes. It does not erase the fact of the commission of the offense and the conviction therefor. It frees the convict from all penalties and legal disabilities and restores to him all his civil rights; but, unless expressly grounded on the person's innocence, it does not ipso facto restore him to public office necessarily relinquished or forfeited by reason of the conviction . Pardon does not generally result in automatic reinstatement because the offender has to apply for reappointment; neither is he entitled to backpay. "Thus, in Sabello vs. DECS , although we reinstated the petitioner-pardonee to his previous position in the interest of "justice and equity," we did not grant him backwages since he "was lawfully separated from the government service upon his conviction for an offense." We reiterated that the right to backwages was afforded only to those who were illegally dismissed but thereafter ordered reinstated, or to those otherwise acquitted of the charge against them. ". . . Hence, in Garcia vs. Chairman, Commission on Audit , we said that "if the pardon is based on the innocence of the individual, it affirms this innocence and makes him a new man and as innocent as if he had not been found guilty of the offense charged." In that case, Garcia was found administratively liable for dishonestly. He was, however, acquitted by the trial court of the complaint for qualified theft based on the very same acts. The acquittal was founded not on lack of proof beyond reasonable doubt but on the fact that he did not commit the offense imputed to him. This Court said that after having been declared innocent of the criminal complaint, which had the same basis as the administrative charge, for all legal purposes the petitioner should not be considered to have left his office, so that he was entitled to all the rights and privileges that accrued to him by virtue of the office held, including backwages . He was restored to his office ipso facto upon the issuance of the clemency. The grant of backwages was justified "to afford relief to [the] petitioner who [was] innocent from the start and to make reparation for what he [had] suffered as a result of his unjust dismissal from the service." HcSETI Applying the foregoing decision of the Supreme Court in the case under consideration, it is the considered opinion of this Office that you are not entitled to retirement benefits. In contrast to the Garcia Case cited above, you were convicted beyond reasonable doubt of the crime of Malversation of Public Funds. You were also found guilty for Dishonesty and Violation of Office Rules and Regulations and dismissed from public service. The latter conviction carries with it forfeiture of your retirement benefits. The subsequent grant of executive clemency in your favor does not carry with it the restoration of your right to retirement benefits. Accordingly, your request for payment of retirement of benefits is hereby denied for lack of any legal basis. However, your request for payment of terminal leave benefits is hereby granted pursuant to the ruling of this Office in BIR Ruling No. UN-231-A-6-27-95 dated May 24, 1995, to wit: "It is the opinion of this Office that the pendency of an administrative case cannot justify the withholding of Mr. Pareos terminal leave pay. By long usage in the Government service, accrued leave credits are considered earned salaries applied for and granted to a separated official or employee. Even the Office of the Ombudsman has adopted a lenient policy of not requiring a retiree from securing an Ombudsman clearance for the payment of the money value of the accrued leave credits of the latter. (Memorandum Circular No. 9, Series of 1994) This is so because unlike retirement benefits, accrued leave credits are not subject to forfeiture in the event the official or employee is found guilty of administrative charge. However, if this Bureau has pending money claims against Mr. Pareo, the same should be deducted from his terminal leave pay before approving the attached Disbursement Voucher." Furthermore, the provisions of Section 65 of Civil Service Commission Memorandum Circular No. 14, of 1999, provide that one who has been penalized with dismissal from service is not barred from entitlement to terminal leave benefits, viz : "Sec. 65. Effect of decision in administrative case . An official or employee WHO HAS BEEN PENALIZED WITH DISMISSAL FROM THE SERVICE IS LIKEWISE NOT BARRED FROM ENTITLEMENT TO HIS TERMINAL LEAVE BENEFITS. This ruling is issued on the basic of the foregoing facts as represented. However, if upon investigation, it will be ascertained that the facts are different, this ruling shall be considered null and void. Very truly yours, Commissioner of Internal Revenue By: (SGD.) JOSE MARIO C. BUAG Deputy Commissioner Legal and Inspection Group