RESINS INCORPORATED, PETITIONER, VS. AUDITOR GENERAL OF THE PHILIPPINES AND THE CENTRAL BANK OF THE PHILIPPINES, RESPONDENTS.

Petitioner here, as did petitioner in, Casco Philippine Chemical
Co., Inc. v. Gimenez,^[1]
would seek a refund^[2]
from respondent Central Bank on the claim that it was exempt from the margin
fee under Republic Act No. 2609 for the importation of urea and formaldehyde,
as separate units, used for the production of synthetic glue, of which it was a
manufacturer.  Since the specific
language of the Act speaks of “urea formaldehyde”,^[3]
and petitioner admittedly did import urea and formaldehyde separately, its plea
could be granted only if we could
construe the above provision of law to read “urea and
formaldehyde”.  In the above Casco
decision, we could not see our way clear to doing so.  We still cannot see it that way.  Hence, this petition must fail.

Our inability to indulge petitioner in the aforecited
Casco petition was made clear by the present Chief Justice.  Thus:  
“Hence, ‘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 resins known as ‘urea formaldehyde’.  Petitioner contends, however, 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 as 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.  But, said
individual statements do not necessarily reflect the view of the Senate.  Much less do they indi­cate the intent of the
House of Representatives * * *. 
Furthermore, it is well settled that 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 we 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.”

To which we can only add that deference to the scope and
implication of the function entrusted by the Constitution to the judiciary
leaves us no other alternative.  For
nothing is better, settled than that the first and fundamental duty of courts
is to apply the law as they find it, not as they would like it to be.  Fidelity to such a task precludes
construction or interpretation, unless application is impossible or inadequate
without it.^[4]
Such is not the case in the situation presented here.  So we have held in Casco Philippine Chemical
Co., Inc. v. Gimenez. 
We do so again.

Then, again, there is merit in the contention of the
Solicitor-General, as counsel for respondent Central Bank, and the Auditor General,
that as a refund undoubtedly partakes of a nature of an exemption, it cannot be
allowed unless granted in the most explicit and categorical language.  As was held by us in Commissioner of Internal
Revenue v. Guerrero:^[5]
“From 1906, in Catholic Church vs. Hastings to 1966, in Esso Standard Eastern, Inc. vs. Acting Commissioner of
Customs, it has been the constant and uniform holding that exemption from
taxation is not favored and is never presumed, so that if granted it must be
strictly construed against the taxpayer. 
Affirmatively put, the law frowns on exemption from taxation,
hence, an exempting provision should be construed strictissimi juris.”
Certainly, whatever may be said of the statutory language found in
Republic Act 2609, it would be going too far to assert that there was such a
clear and manifest intention of legislative will as to compel such a refund.

One last matter.  Petitioner would assail as devoid of support
in law the action taken by the respondent Auditor-General in an indorsement to the respondent Central Bank^[6]
causing it to over­rule its previous resolution and to adopt the view in such indorse­ment to the effect that the importation of urea and
of formaldehyde, as separate units, did not come within the purview of the
statutory language that granted such exemption. 
It does not admit of doubt that the respondent Auditor-General’s
interpretation amounts to a literal adherence to the statute as enacted.  As such, it cannot be said to be contrary to
law.  As a matter of fact, it is any
other view, as is evident from the above, that is
susceptible to well-founded, criticism, as lacking legal basis.  Under the circumstances, the respondent
Auditor-General was merely complying with his duty in thus calling the
attention of respondent Central Bank.

The limit of his constitutional function was clearly set forth in
Guevara v. Gimenez,^[7]
the opinion being rendered by the present Chief Justice.  Thus: 
“Under our Constitution, the authority of the Auditor General, in
connection with expenditures of the Government is limited to the auditing of
expenditures of funds or property pertaining to, or held in trust by, the
Government or the provinces or municipalities thereof (Article XI, section 2,
of the Constitution).  Such function is
limited to a determination of whether there is a law appropriating funds for a
given purpose; whether a contract, made by the proper officer, has been entered
into in conformity with said appropriation law; whether the goods or services
covered by said contract have been delivered or rendered in pursuance of the
provisions thereof, as attested to by the proper officer; and whether payment therefor has been Authorized by the officials of the corresponding
department or bureau.  If these
requirements have been fulfilled, it is the ministerial duty of the Auditor
General to approve and pass in audit the voucher and treasury warrant for said
payment.  He has no discretion or
authority to disapprove said payment upon the ground that the aforementioned
contract was un­wise or that the amount stipulated thereon is
unreasonable.  If he entertains such
belief, he may do no more than discharge the duty imposed upon him by the
Constitution (Article XI, section 2), ‘to bring to the attention of the proper
administrative officer expendi­tures of funds or property which, in his
opinion, are irregular, unnecessary, excessive or extravagant’.  This duty implies a negation of the power to
refuse and disapprove payment of such expenditures, for its disapproval, if he
had authority therefor, would bring to the attention
of the aforementioned administrative officer the reasons for the adverse action
thus taken by the General Auditing office, and, hence, render the imposition of
said duty unnecessary.”

In the same way that the Auditor General, by virtue of the above
function, which is intended to implement the constitutional mandate that no
money can be paid out of the treasury except in the pursuance of appropriation
made by law,^[8]
must carefully see to it that there is in fact such statutory enactment, no
refund, which likewise represents a diminution of public funds in the treasury,
should be allowed unless the law clearly so provides.  The Auditor General would be sadly remiss in
the discharge of his responsibility under the Constitution if, having the
statute before him, he allows such a refund when, under the terms thereof, it
cannot be done.  His actuation here
cannot be stigmatized as violative of any legal
precept; as a matter of fact, it is precisely in accordance with the
constitutional mandate.

WHEREFORE, this
petition is denied, with costs against petitioner.

Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Sanchez,
Castro, Angeles, and Capistrano, JJ., concur.

Zaldivar, J., on official leave.

^[1]
L-17931, February 28, 1963.

^[2]
According to the Prayer in the Brief for Petitioner dated March 27, 1961, it had deposited with respondent
Central Bank the amount of P52,271.09, exclusive of
further sums filed by it since the date of the filing of this petition,
representing the margin fee deposited by it on its various importation of urea
and formaldehyde as separate articles.

^[3]
Section 2, par. XVIII, Republic Act No. 2609.

^[4]
People v. Mapa, L-22301, August 30, 1967; Pacific Oxygen & Acetylene. Co. v. Central
Bank, L-21881, March 1, 1968; Dequito v.
Lopez, L-27757, March 28, 1968 and Padilla v. City of Pasay, L-24039, June 29, 1968.

^[5]
L-20942, September 22, 1967.

^[6]
3rd Indorsement dated July 13, 1960.

^[7]
L-17115, Nov. 30, 1962. Cf.
Radiowealth, Inc. v. Agregado,
86 Phil. 429 (1950); Phil. Operations, Inc. v. Auditor-General, 94 Phil.
868 (1954) Villegas v. Auditor General, L-21352, Nov. 29, 1966.  The rather broad language in Matute v. Hernandez, 66 Phil. 68 (1938) has thus
been qualified.

^[8]
Par. 2, Section 23, Article VI, Constitution of the Philippines.