Wednesday, November 10, 2010

Case Digest: Casco Chemical Co. vs Gimenez

Facts of the Case:

Casco Chemical Co., which is engaged in the manufacture of synthetic resin glues used in bonding lumber and veneer by plywood and hardwood producers, bought foreign exchange for the importation of urea and formaldehyde which are the main raw materials in the production of the said glues. They paid P33,765.42 in November and December 1949 and P6345.72 in May 1960. Prior thereto, the petitioner sought the refund of the first and second sum relying upon Resolution No. 1529 of the Monetary Board of said bank, dated November 3, 1959, declaring that the separate importation of urea and formaldehyde is exempt from said fee. The Auditor of the Bank, Pedro Gimenez, refused to pass in audit and approve the said refund on the ground that the exemption granted by the board in not in accord with the provision of section 2 of RA 2609.

Issue of the Case:
Whether or Not Urea and formaldehyde are exempt by law from the payment of the margin fee.


No, it is not exempt from payment of the marginal fee. Urea formaldehyde is clearly a finished product which is distinct from urea and formaldehyde. The petitioner’s contends that the bill approved in Congress contained the conjunction “and” between the terms “urea” and “formaldehyde” separately as essential elements in the manufacture of “urea formaldehyde” and not the latter. But this is not reflective of the view of the Senate and the intent of the House of Representatives in passing the bill. If there has been any mistake in the printing of the bill before it was passed the only remedy is by amendment or curative legislation, not by judicial decree.

Decision appealed from is AFFIRMED with cost against the petitioner.

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