BIR Ruling [UN-034-96]

January 25, 1996 BIR RULING [UN-034-96] Hon. Salvador M. Enriquez, Jr. Secretary Department of Budget and Management Malacaang, Manila S i r : This refers to your letters dated July 13 and October 12, 1995 denying our request for the release of funds in the respective amounts of P11,289,922.47, P761,832.22, P312,246.00 and P457,743.76 or a total of P12,821,744.45 to cover the payment of separation benefits of former employees of the defunct Revenue Information Systems Services, Inc. (RISSI) who were absorbed by the Bureau of Internal Revenue. In connection therewith, we respectfully request reconsideration of said decision for the following reasons, viz: cdta 1. The absorbed employees of the BIR from RISSI. It is a fact that they were separated from RISSI, a private corporation, not due to financial distress but in view of the promulgation of Executive Order No. 468. Hence, pursuant to the Decision of the National Labor Relations Commission dated March 10, 1995 in NLRC Case No. 00-04-02440-98 entitled "Antonio M. Lubang et al vs. Revenue Information Systems Services, Inc. (RISSI) et al", the said employees of RISSI are entitled to separation benefits under Article 283 of the Labor Code. These absorbed employees were admitted by the BIR as new employees, and, therefore, their services with RISSI cannot be considered later for purposes of their retirement benefits with the BIR ; 2. Upon dissolution of RISSI, all of its assets and liabilities were transferred to the Bureau of Internal Revenue, Pursuant to Section 4 of Executive Order No. 468, pertinent portion of which reads: "SEC. 4. Transfer of Records and Others . The records, equipment, facilities, and personnel of said corporation are hereby transferred to the proper accomplishment of the objectives of this Executive Order. The appropriation and funds of said corporation, if any, shall revert to the General Fund after reserving an amount to pay for benefits of those separated laid off or retired from public service under the preceding Section 3; provided, that if the appropriation and funds of the corporation are not sufficient to pay such benefits, the deficiency shall be satisfied from the savings of the Department of Finance and thereafter from unappropriated balances of the National Treasury . . ." (Underlining ours, for emphasis). the Bureau of Internal Revenue which is an agency under the Department of Finance, should pay RISSI's obligations including the separation benefits of its employees; and, 3. The BIR has generated enough savings for 1995 as per attached Certification of the Chief Accountant and Chief of Budget Division of this Office. cdtech Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue