Buenafe vs. Comelec,
G.R. No. 260374. June 28, 2022
En Banc, ZALAMEDA, J.
Facts:
On 2
November 2021, petitioners Buenafe, et al. filed before the COMELEC a Petition
to Deny Due Course to or Cancel the COC of respondent Marcos, Jr. under Section
78, in relation to Section 74, Article IX of Batas Pambansa Blg. (BP) 881, or
the Omnibus Election Code (OEC).
Petitioners
Buenafe, et al. and Ilagan, et al. referred to the same set of criminal cases
for the violation of the National Internal Revenue Code of 1977, as amended
(1977 NIRC), involving respondent Marcos, Jr.
On 27
June 1990, the Special Tax Audit Team (audit team) created by then Commissioner
of Internal Revenue Jose U. Ong (Commissioner Ong) commenced an investigation
of the internal revenue tax and estate tax liabilities of the late President
Ferdinand E. Marcos, his immediate family, as well as his alleged
"associates and cronies." The audit sought to determine whether the
taxpayer: (1) earned income; (2) filed the required income tax; and (3) made
the corresponding tax payment. The audit team submitted its findings to
Commissioner Ong, which prompted him to file a letter complaint dated 25 July
1991 with the Secretary of Justice.
In
Criminal Cases Nos. Q-91-24391, Q-92-29212, Q-92-29213, and Q-92-29217,
respondent Marcos, Jr. was charged with violation of the 1977 NIRC for failure
to file his income tax returns for the years 1982, 1983, 1984, and 1985. In
Criminal Cases Nos. Q-92-29216, Q-92-29215, Q-92-29214, and Q-91-24390,
respondent Marcos, Jr. was charged with violation of the 1977 NIRC for failure
to pay income taxes due, exclusive of surcharges and interests, in the amounts
of P107.80 for 1982, P3,911.00 for 1983, P1,828.48 for 1984, and P2,656.95 for
1985.
RTC
held that Ferdinand Marcos Jr guilty beyond reasonable doubt. CA agreed with
respondent Marcos, Jr. that there was insufficient notice from the BIR. It
further declared that respondent Marcos, Jr. should not have been held to
answer for the criminal charges filed against him for non-payment of deficiency
income tax liabilities.
CA
acquitted the accused-appellant of the charges for violation of Section 50 of
the NIRC for non-payment of deficiency taxes for the taxable years 1982 to 1985
in Criminal Cases Nos. Q-02-29216, Q-92-29215, Q-92-29214, and Q-91-24390; and
FINDING him guilty beyond reasonable doubt of violation of Section 45 of the
NIRC for failure to file income tax returns for the taxable years 1982 to 1985
in Criminal Cases Nos. Q-91-24391, Q-92-29212, Q-92-29213, and Q-92-29217.
CA
ordered the appellant to pay a fine of P2,000.00 for each charge in Criminal
Cases Nos. Q-92-29213, Q-92-29212 and Q-29217 for failure to file income tax
returns for the years 1982, 1983, and 1984; and the fine of P30,000.00 in
Criminal Case No. Q-91-24391 for failure to file income tax return for 1985,
with surcharges.
On 02
December 2021, the RTC released a certification stating that there is no record
on file of respondent Marcos, Jr.'s compliance of payment or satisfaction of
its Decision dated 27 July 1995 or that of the CA's Decision dated 31 October
1997. Neither was there any entry in the criminal docket of the RTC Decision
dated 27 July 1995 as affirmed and modified by the CA.
In
SPA No. 21-156 (DC), petitioners Buenafe, et al. argued before the COMELEC that
respondent Marcos, Jr. committed false material representation when he stated
in his COC that he is eligible to run for President. They maintained that
respondent Marcos, Jr.'s prior conviction carries with it the accessory penalty
of perpetual disqualification from holding any public office, to vote, and to
participate in any election.
The
COMELEC Second Division ruled that respondent Marcos, Jr.'s material representations are not
false, i.e., that he is eligible for the position of President and that he is
not perpetually disqualified from public office. It underscored that the
CA Decision did not mete out the penalty of perpetual disqualification from
holding public office. It also found, as a matter of judicial notice, that
respondent Marcos, Jr. ceased to be a public officer when he and his family were
forced to leave the Philippines on 25 February 1986. The penalty of perpetual disqualification from
public office under Section 286 of Presidential Decree No. (PD) 1994, which
amended Section 286(c) of the 1977 NIRC, thus cannot apply to respondent
Marcos, Jr. since he was already a private individual when he failed to file
his 1985 income tax return. The COMELEC Second Division also concluded
that respondent Marcos, Jr. had no intention to deceive the electorate about
his qualifications for public office.
The
COMELEC Second Division reiterated this Court's declaration in Republic v.
Ferdinand Marcos II and Imelda R. Marcos that failure to file an income tax
return is not a crime involving moral turpitude. Moreover, failure to file
income tax returns is not tax evasion.
Issue 1:
Whether the Supreme Court
still has jurisdiction to rule upon the eligibility of [respondent Marcos, Jr.
Held:
Yes; By the same token, the PET
is not a separate and distinct entity from the Supreme Court, albeit it has
functions peculiar only to the Tribunal. It is obvious that the PET was
constituted in implementation of Section 4, Article VII of the Constitution,
and it faithfully complies — not unlawfully defies — the constitutional
directive. The adoption of a separate seal, as well as the change in the nomenclature
of the Chief Justice and the Associate Justices into Chairman and Members of
the Tribunal, respectively, was designed simply to highlight the singularity
and exclusivity of the Tribunal's functions as a special electoral court.
When the Court acts as the PET, it
is not a separate and distinct body from the Court itself. The constitutional
provision refers to the same "Supreme Court sitting en banc."
However, it should be recognized that the proceedings before the PET require a
distinct set of rules of procedure owing to the very specific nature of its
functions. Thus, the exercise of jurisdiction of the Court En Banc as the PET
is likened to the characterization of specialized courts in relation to the
then Courts of First Instance. They are the same courts having the same
jurisdiction, only that specialized courts are intended for practicality.
Section 4, Article VII of the 1987 Constitution therefore should not be
considered as a limitation on the jurisdiction of the Court over the pending
petitions.
Issue 2:
Whether
the COMELEC committed grave abuse of discretion amounting to lack or excess of
jurisdiction in refusing to cancel the subject COC of Respondent Marcos, Jr.
and ruling that respondent Marcos, Jr.'s material representations, i.e., that
he is eligible for the position of President and that he has not been convicted
of a crime punished with the penalty of perpetual disqualification from public
office, are not false.
Held:
No; respondent
Marcos, Jr. possesses all of the qualifications and does not possess any of the
grounds for disqualification.
We reiterate that the
qualifications for President and Vice-President are prescribed in Section 2,
Article VII of the 1987 Constitution. These qualifications are also found in
Section 63 of the OEC.
There is no question that respondent
Marcos, Jr. has all the qualifications of a candidate for President as provided
under the Constitution and the OEC. Notably, neither the Buenafe Petition nor
the Ilagan Petition alleges that respondent Marcos, Jr. lacks any of these
qualifications: natural-born citizen of the Philippines, a registered voter,
able to read and write at least forty years of age on the day of the election,
and a resident of the Philippines for at least ten years immediately preceding
such election.
Petitioners Ilagan, et al. instead
argue that respondent Marcos, Jr. has been convicted of a crime involving moral
turpitude and is thus disqualified from being a candidate and holding any
government office under Section 12 of the OEC.
Respondent Marcos, Jr.'s failure to
file income tax returns is not a crime involving moral turpitude.
Not every criminal act involves
moral turpitude, nor do they necessarily have to be heinous. Moral turpitude has been often
understood to mean acts that are "contrary to justice, modesty, or good
morals; an act of baseness, vileness or depravity in the private and social
duties which a man owes his fellowmen, or to society in general."
It does not include such acts as are not of themselves immoral but whose
illegality lies in their being positively prohibited.
Indeed, in Zari v. Flores, We said
that tax evasion is a
crime involving moral turpitude. On whether an act or omission
constitutes tax evasion, We certainly agree that it depends on the totality of
circumstances. As such, it must be clarified that failure to file income tax
return does not always amount to tax evasion. Tax
evasion connotes fraud through the use of pretenses and forbidden devices to
lessen or defeat taxes. The fraud contemplated by law is actual and
not constructive. It must be intentional fraud, consisting of deception
willfully and deliberately done or resorted to in order to induce another to
give up some legal right. Negligence, whether slight or gross, is not
equivalent to the fraud with intent to evade the tax contemplated by law. It
must amount to intentional wrong-doing with the sole object of avoiding the
tax. Furthermore, tax evasion connotes the integration of three factors: (a)
the end to be achieved, i.e., the payment of less than that known by the
taxpayer to be legally due, or the non-payment of tax when it is shown that a
tax is due; (b) an accompanying state of mind, which is described as being
"evil," in "bad faith," "willful," or
"deliberate and not accidental"; and (c) a course of action or
failure of action that is unlawful.
On the other hand, failure to file income tax return may be
committed by neglect, without any fraudulent intent and/or willfulness. In
fact, under Section 248 of the 1997 NIRC, the law treats "failure to file
any return" differently from "willful neglect to file the
return." The former is meted with a surcharge of 25%, while the latter,
50%. The 50% rate is referred to as the fraud penalty. Previously, under
Section 72 of the 1939 NIRC, a taxpayer may be excused from the 25% surcharge
if the taxpayer subsequently files the return despite absence of BIR notice and
the earlier failure is due to a reasonable cause.
As
Associate Justice Amy C. Lazaro-Javier eloquently declared, taken in its proper
context, the failure to file a compensation income tax return is far from being
"everything which is done contrary to justice, modesty, or good morals; an
act of baseness, vileness or depravity in the private and social duties which a
man owes his fellowmen, or to society in general." [Teves vs. Comelec].
The 'failure to file an income tax
return' is not a crime involving moral turpitude as the mere omission is
already a violation regardless of the fraudulent intent or willfulness of the
individual. This conclusion is supported by the provisions of the NIRC as well
as previous Court decisions which show that with regard to the filing of an
income tax return, the NIRC considers three distinct violations: (1) a false
return, (2) a fraudulent return with intent to evade tax, and (3) failure to
file a return.
This clarification starts with a
distinction between taxpayers who are not required to file income tax returns
from taxpayers who file tax returns under the substituted filing system. Under Section 51(A)(2) of the 1997 NIRC, as amended, a
minimum wage earner is exempt from income tax and is not required to file an
income tax return. On
the other hand, an individual earning purely compensation income from a single
employer whose income tax has been correctly withheld by said employer is not
required to file an annual income tax return. Over the years, the BIR
recognized the need to simplify the filing of individual income tax returns. It
introduced the substituted filing system in Revenue Regulations (R.R.) No.
3-2002, which was further amended by R.R. No. 19-2002. Substituted filing took
effect in taxable year 2001 and was made mandatory starting the taxable year
2002.
The substituted filing system made it easier for pure
compensation earners to file their income tax returns because the relevant
information is more accessible to their employers. In substituted filing, the
employer's annual return for the employee is considered as the employee's
income tax return because they contain identical information. Employers, or
other persons who are required to deduct and withhold the tax on compensation,
furnish their employees with a Certificate of Income Tax Withheld on
Compensation, or BIR Form No. 2316. After the issuance of a joint certification
by the employer and the employee, the employee who is qualified for substituted
filing is no longer required to file an Annual Income Tax Return, or BIR Form
No. 1700.
Under "substituted
filing", an individual taxpayer although required under the law to file
his income tax return, will no longer have to personally file his own income
tax return but instead the employer's annual information return filed will be
considered as the "substitute" income tax return of the employee
inasmuch as the information in the employer's return is exactly the same
information in the employee's return.
Conviction
for non-filing of income tax returns is not a ground for disqualification. We agree with the COMELEC, that the
introduction of the penalty of both imprisonment and fine in Section 254 only
became effective in 1998 when the 1997 NIRC was passed. Consequently, this cannot be retroactively applied to the
prejudice of respondent Marcos, Jr., who was convicted for failure to file the
required tax returns for the years 1982 to 1985. Well-settled is the
rule that penal laws cannot be given retroactive effect, unless favorable to
the accused.
Respondent Marcos, Jr.'s
representations that are subject of the Petitions are material. In Villafuerte v. COMELEC, We held that, for
a representation to be material, it must "refer to an eligibility or qualification for the
elective office the candidate seeks to hold." Thus, facts
pertaining to a candidate's residency, age, citizenship, or any other legal
qualification are considered material under Section 78 of the OEC.
Further, in Salcedo II v. COMELEC,
the Court explained the rationale behind the requirement of materiality, and
concluded that the law should not be interpreted to cover innocuous mistakes: Therefore,
it may be concluded that the material misrepresentation contemplated by section
78 of the Code refer to qualifications
for elective office. This conclusion is strengthened by the fact that
the consequences imposed upon a candidate guilty of having made a false
representation in his [or her] certificate of candidacy are grave — to prevent
the candidate from running or, if elected, from serving, or to prosecute him
[or her] for violation of the election laws. It could not have been the
intention of the law to deprive a person of such a basic and substantive political
right to be voted for a public office upon just any innocuous mistake.
In this case, petitioners Buenafe,
et al. assert that respondent Marcos, Jr. made a false material representation
when, in his COC, he certified under oath the statement, "I am eligible
for the office I seek to be elected to." Respondent Marcos, Jr. also
allegedly misrepresented his eligibility when he checked the box "No"
in response to the question, "[have you ever been found liable for an
offense which carries with it the accessory penalty of perpetual
disqualification to hold public office, which has become final and
executory?" Petitioners Buenafe, et al. claim that respondent Marcos,
Jr.'s conviction for violation of the NIRC carried with it the penalty of
perpetual disqualification, thereby rendering the two statements false.
The assailed representations pass
the test of materiality because they pertain to respondent. Marcos, Jr.'s eligibility
to hold elective office. In Dimapilis v. COMELEC (Dimapilis), We ruled that
perpetual disqualification is a material fact because it directly affects a
person's capacity to be elected and to hold public office, thus:
A
CoC is a formal requirement for eligibility to public office. Section 74 of the OEC
provides that the CoC of the person filing it shall state, among others, that
he is eligible for the office he seeks to run, and that the facts stated
therein are true to the best of his knowledge. To be "eligible" relates
to the capacity of holding, as well as that of being elected to an office.
Conversely, "ineligibility" has been defined as a
"disqualification or legal incapacity to be elected to an office or
appointed to a particular position." In this relation, a person intending
to run for public office must not only possess the required qualifications for
the position for which he or she intends to run, but must also possess none of
the grounds for disqualification under the law.
In this case, petitioner had been
found guilty of Grave Misconduct by a final judgment, and punished with
dismissal from service with all its accessory penalties, including perpetual
disqualification from holding public office. Verily, perpetual disqualification
to hold public office is a material fact involving eligibility which rendered
petitioner's CoC void from the start since he was not eligible to run for any
public office at the time he filed the same. When respondent Marcos, Jr.
declared that he has not been convicted of an offense that carries with it the
accessory penalty of perpetual disqualification to hold office, he made a
material representation regarding his eligibility to run for and hold elective
office. This representation, if proved false, would fall within the ambit of
Section 78 of the OEC.
Similarly, respondent Marcos, Jr.
made a material representation when he signed and subscribed to his COC, which
states that, "I am eligible for the office I seek to be elected to."
In Aratea v. COMELEC, the Court emphasized that disqualification to run for
office is an ineligibility. Consequently, a statement in the COC that one is
eligible, when such is not the case, is a false material representation constituting ground for
the application of Section 78 of the OEC: Perpetual special
disqualification is a ground for a petition under Section 78 of the Omnibus
Election Code because this accessory penalty is an ineligibility, which means
that the convict is not eligible to run for public office, contrary to the
statement that Section 74 requires him to state under oath in his certificate
of candidacy. As this Court held in Fermin v. Commission on Elections, the
false material representation may refer to "qualifications or
eligibility." One who suffers from perpetual special disqualification is
ineligible to run for public office. If a person suffering from perpetual
special disqualification files a certificate of candidacy stating under oath
that "he is eligible to run for (public) office," as expressly
required under Section 74, then he clearly makes a false material
representation that is a ground for a petition under Section 78.
Lest it be misunderstood, the denial of due course to or
the cancellation of the CoC is not based on the lack of qualifications but on a
finding that the candidate made a material representation that is false, which
may relate to the qualifications required of the public office he/she is
running for. It is noted that the candidate states in his/her CoC that he/she
is eligible for the office he/she seeks. Section 78 of the OEC, therefore, is
to be read in relation to the constitutional and statutory provisions on
qualifications or eligibility for public office. If the candidate subsequently
states a material representation in the CoC that is false, the COMELEC,
following the law, is empowered to deny due course to or cancel such
certificate. Indeed, the Court has already likened a proceeding under Section
78 to a quo warranto proceeding under Section 253 of the OEC since they both
deal with the eligibility or qualification of candidate, with the distinction
mainly in the fact that a "Section 78" petition is filed before
proclamation, while a petition for quo warranto is filed after proclamation of
the winning candidate.
Ultimately, however, a petition to deny due course to or to cancel COC
and a petition for disqualification are "different remedies, based on
different grounds, and resulting in different eventualities."
First, the two remedies are anchored
on distinct grounds: whereas an action under Section 78 of the OEC is concerned with the false
representation by a candidate as to material information in the COC, a petition for disqualification
relates to the declaration of a candidate as ineligible or lacking in quality
or accomplishment fit for the elective position said candidate is seeking.
To prosper, the former requires proof of deliberate attempt to mislead,
misinform, or hide a fact relating to the candidate's requisite residency, age,
citizenship, or any other legal qualification necessary to run for elective
office; the latter, possession of a disqualification as declared by a final
decision of a competent court, or as found by the Commission.
Second, they have different
prescriptive periods: a
petition to deny due course to or cancel a COC may be filed within five days
from the last day of filing of COCs, but not later than 25 days from the filing
of the COC sought to be canceled; a petition for disqualification may be filed any day after
the last day of the filing of COC, but not later than the date of the
proclamation.
Third, both have markedly distinct
effects: a disqualified person
is merely prohibited to continue as a candidate, while the person whose certificate is canceled or
denied due course is not treated as a candidate at all. Moreover, a
disqualified candidate may still be substituted if they had a valid COC in the
first place. However, one whose COC was denied due course or canceled cannot be
substituted because the law considers him or her to not have been a candidate
at all.
While the grounds for a petition for disqualification are
limited to Sections 12 and 68 of the OEC, and, for local elective officials,
Section 40 of the LGC, the same grounds may be invoked in a petition to deny
due course to or cancel COC if these involve the representations required under
Section 78.