G.R. No. 227796 - NATIONAL TRANSMISSION CORPORATION, VS. COMMISSION ON AUDIT (COA) AND COA CHAIRPERSON MICHAEL G. AGUINALDO.R E S O L U T I O N - Supreme Court E-Library

Ruling

Accordingly, on June 30, 2009, its employees were either retired or separated from service. [5] Mr. Alfredo V. Agulto, Jr. (Agulto), who was a regular employee of petitioner TransCo with the position Principal Engineer B from March 17, 2003 to June 29, 2009, received the amount of P656,597.50 as separation benefits [6] pursuant to petitioner TransCo's Resolution implementing the Early Separation Program. During post-audit, the Supervising Auditor (SA) issued Notice of Disallowance (ND) No. TC-10-005 (09) dated October 19, 2010, [7] disallowing the amount of P22,965.81 from Agulto's separation benefits as said amount pertained to the period March 1 to 15, 2004 during which Agulto's employment status was still contractual. [8] The SA noted that the Service Agreement of Agulto during the said period specially provided that "the service to be rendered is not considered and will not be credited as government service." [9] Thus, the SA found the following persons liable: 1. Bernadine L. Protomartir - Division Manager, General Accounting & Financial Reporting (GAFR) 2. Jose Mari M. Ilagan - Manager, Administrative Department 3. Alfredo V. Agulto, Jr. - Payee. [10] Petitioner TransCo appealed the ND before the Director, Cluster B, Corporate Government Sector (CGS) of the COA. It argued that the payment of separation benefits to contractual employees was lawful as it was in accordance with the EPIRA Law, the Corporation Code, and the Board Resolutions of petitioner TransCo. [11] Ruling of the Commission on Audit Director On July 9, 2014, the COA Director partially granted the appeal by exempting Agulto from liability since he received his separation benefits in good faith. The dispositive portion of the Decision [12] reads: WHEREFORE, foregoing premises considered, the instant Appeal is hereby PARTIALLY GRANTED. Accordingly, only the Members of the Board of Directors responsible for the passage of Resolution Nos. TC 2009-005 and TC 2009-007 and the officers who authorized the release of the funds and certified the expense as necessary and lawful are hereby ordered to refund the amount of disallowed retirement benefits they respectively received. Hence, Mr. Alfredo V. Agulto, Jr. is no longer required to refund the amount disallowed. This, notwithstanding, herein Decision is not yet final and is subject to the automatic review of the COA-[CP] pursuant to Section 7, Rule V of the 2009 Revised Rules of Procedure of the Commission on Audit. [13] Ruling of the Commission on Audit Commission Proper On September 28, 2016, respondent COA-CP rendered Decision No. 2016-278, [14] disapproving the Decision of the COA Director. Respondent COA-CP maintained, that under Section 63 [15] of RA 9136, in relation to Rule 33 [16] of its separation benefits only if their appointments were approved or attested to by the Civil Service Commission (CSC). [17] In this case, since there was no proof that Agulto's appointment was duly approved or attested to by the CSC, the payment