Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G. R. No. L-57650 April 15, 1988
CATALINO Y. TINGA, petitioner,
vs.
PEOPLE OF THE PHILIPPINES, respondent.
Agcaoli & Associates for petitioner.
The Solicitor General for respondent.

MELENCIO-HERRERA, J.:
This is an appeal by certiorari filed by petitioner Catalino Y. Tinga seeking the reversal of the
Decision of the Sandiganbayan finding him guilty of Malversation of Public Funds and sentencing
him to suffer an indeterminate penalty ranging from six (6) years of prision correccional to twelve
(12) years of prision mayor; to suffer perpetual special disqualification; to pay a fine of P70,879.72;
and to pay the costs. The penalty was arrived at after appreciating two (2) mitigating circumstances
in petitioner's favor, namely, voluntary surrender and full restitution of the amount involved.
At the time the criminal case was filed against petitioner he was the Municipal Treasurer of Bogo,
Cebu, and concurrently the Deputy Provincial Treasurer, having been appointed to said position on
September 16, 1976.
On July 26,1978, an audit team of the Commission on Audit conducted an audit examination of
petitioner's accountability and found a shortage of P144,094.98 broken down as follows:

. General
Fund

P
102,182.7
5

2. Trust
Fund

3,469.16

3.
Infrastructur
e Fund

13,846.62

4. Spec.
Education
Fund

24,696.45

Total

P
144,094.9
8

On August 15, 1978, a letter of demand for the restitution of said shortage was served upon
petitioner, but the latter failed to restitute. In the same month, petitioner was relieved as Municipal
Treasurer. Thereafter, an administrative investigation was conducted by the Tanodbayan deputized
prosecutor. Petitioner asked for a re-audit but COA denied his request for the reason that the case
was already in the hands of the Tanodbayan for prosecution.
On April 21, 1980, petitioner was charged before the Sandiganbayan of Malversation of Public
Funds.
On April 30, 1980, upon advice of petitioner's counsel, petitioner disposed of his inherited properties
and deposited, in cash, with the Provincial treasurer of Cebu the sum of P144,000.00 subject to
adjustments as to his correct liability, if any. Because of an excess of payment, however, the sum of
P4,345.93 was reimbursed to him by the Municipality of Bogo in October, 1980.
After trial, respondent Sandiganbayan found petitioner guilty of the crime charged but only after
deducting from his total accountability the following items:

. For 44
disbursement
vouchers

P
12,654.80

2. For loss due to

robbery

10,708.14

3. For amount
malversed by

Laurencio R.
Masong

7,398.30

4. For payments
to terminal pays

of municipal
employees (not

pre-audited)

8,108.09 5.

5. Withdrawal
never made

by Tinga on Feb.
15, 1978

30,000.00

6. Amount
reimbursed to
Tinga

as excess of his
deposit of

P1 44,000.00

4,345.93

Total

P73,215.26

Thus, petitioner was held accountable only for the sum of P70,879.72 out of the original alleged
shortage of P144,094,98.
In this appeal, petitioner contends that respondent Court erred:
1. In not declaring that the examination and audit report prepared and conducted by
the examining auditors is contrary to law.
2. In not upholding the constitutional rights of accused of "due process" by not
allowing re-examination and re-audit of the alleged shortage of the petitioner in the
amount of P l44,094.98.
3. In not resolving that the guilt of the petitioner has not been proven beyond
reasonable doubt.
We find merit in the appeal.
Conviction by respondent Court was predicated on the finding that "as regards this amount of
P70,879.72 left unexplained, the prima facie presumption that said sum has been applied to
personal uses by the accountable officer as of July 26, 1978 has not been overthrown."
The prima facie presumption under Article 127 of the Revised Penal Code arises if there is no issue
as to the accuracy, correctness and regularity of the audit findings and if the fact that funds are
missing is indubitably established. That is not so in this case, however, as shown by the following
circumstances: 1) Early on, after petitioner deposited the amount of Pl44,000.00 on April 30,1980
with the Municipality of Bogo, an excess of payment in the sum of P4,345.93 was already discovered
and had to be reimbursed to him by the Municipality in October, 1980.
2) The Sandiganbayan Decision is replete with findings of errors in the audit made of petitioner's
accountability. Thus, it said: (a) "We are not prepared to repeat the same mistake as the audit team
and prefer to credit Catalino Y. Tinga for said sum of P 12,654.80 deductible from his alleged
shortage" (p. 13, Decision); (b) "the claim of the defense that Tinga was a victim of robbery is fully
supported ... resulting in a total loss of P10,708.14 ... The COA auditing team ought to have credited
the accused in this amount in his total accountability for the accused never pocketed to his benefit
this amount lost" (pp. 13-14, Ibid.); (c) "Court records indubitably attest to the fact that Laurencio R.
Masong, collection clerk of the Municipal Treasurer's office of Bogo, Cebu, failed to turn over to the
accused collections in the total sum of P7,398.30 in October, 1976, for which reason said employee
was charged and convicted of the crime of Malversation of Public Funds . . .. Why then should the
COA auditors include the said sum in the accountability of Tinga?' (p. 14, Ibid.); (d) "we find it
relevant to observe that a careful examination of Exh, "L-1" shows that the entry for withdrawal of
voucher No. ... has two circles with a cross inside before and after the entry, indicate a cancellation
or mistake thereat. ... Thus, the sum of P30,000.00 appears to be honestly disputed, which also
served as basis for the accused to insist on a review or re-audit" (p. 17, Ibid.); (e) "such conclusion
of the COA arose from many errors committed during the audit examination ..." (p. 23, Ibid.).

Thus it was that a total of P73,215.26 was deducted by the Sandiganbayan from petitioner's total
accountability.
The Sandiganbayan Decision went on to state that petitioner had sought relief by writing the COA for
a re-audit and/or review. The re-audit requested was eventually denied as the case was already in
the hands of the Tanodbayan. As it was, however, many errors, as observed by the Sandiganbayan
were, in fact, committed in the audit.
By that denial of the re-audit, petitioner was, as claimed by him, not given the right to be fully heard
before the charge was filed against him at a time when records were still available and past
transactions still fresh in the memory of all concerned. He was given the chance to defend himself
before the Sandiganbayan, yes, but as said Court itself observed "Tinga continued to pursue his
quest for a re-audit in his honest belief that he had not malversed any government funds In the
process, many but not all disbursement vouchers were located in the office of the Municipal
treasurer of Bogo, Cebu, ... " Perhaps, if he had been re-audited and his accountability reviewed, a
different result may have been produced.
It is incorrect to state that petitioner-accused had admitted his shortage when he signed the audit
report prepared by the audit team. For one thing, he was made to sign it right away; for another, his
signature thereon only meant an acknowledgment that a demand on him to produce all his cash,
money and paid vouchers had been made. The other declarations therein such as that the statement
of his accountability is in accord with his records and accounts is negated by subsequent
developments in the case.
As contended by petitioner, there has, in fact, been incomplete and haphazard compliance with the
Manual of Instructions to Treasurers and Auditors and Other Guidelines in the petition made by the
audit team.
SEC. 560. The procedure and scope of a cable examination and inspection. cash
examination shall embrace the following:
xxx xxx xxx
(d) Inspection of the total contents of the safes and other cash receptacles in tie
possession of each accountable officer or employee to establish absolute
certainty that no other cash, checks, warrants, or valid cash items have been left out
of the count and inventory. (Emphasis supplied)
It is apparent that, with other vouchers and supporting documents still found after audit, the test of
absolute certainty was not met and that various records were inadvertently left out during the audit
examination.
Section 561 of the same Manual also provides:
SEC. 561. Prohibition of incomplete examinations. Examinations shall
be thorough and complete in every case to the last detail. Mere count of cash and
valid cash items without verifying the stock of issued and unissued accountable
forms and the various records of collections and disbursements, as well as the
entries in the cashbook is not elimination at all. ... (Emphasis ours)

The audit examination conducted left much to be desired in terms of thoroughness and
completeness as disclosed by the errors that surfaced subsequently. In fact, it is not clear how long
the audit examination took. The audit team claimed that it took all of one (1) week. Their report,
however, bears only one date, July 26, 1978, and could have taken only one day.
It is also to be noted that some items in petitioner's accountability were disallowed by the audit team
for lack of a pre-audit although apparently they were in payment of valid obligations of the
municipality and were subsequently passed in audit. Thus, the Sandiganbayan had occasion to
observe: "The prosecution does not dispute the legality and validity of the claims so paid but the
COA auditors took to task the accused-treasurer at the time of the audit examination for this total
sum of P8,108.09 because the vouchers covering the payment were not yet approved on pre-audit.
But it is plain that the claims were not either contested. No wonder then that accused Catalino Y.
Tinga was fighting for the recognition of these payments he made in good faith as not having been
misappropriated by him in reality" (Decision, p. 15).
Upon the attendant facts and circumstances, it has to be held that the presumption juris tantum in
Article 217 of the Revised Penal Code reading:
The failure of a public officer to have duly forthcoming any public funds or property
with which he is chargeable upon demand by any duly authorized officer, shall be
prima facie evidence that he has put such missing funds or property to personal
uses.
cannot be applied in view of the reasonable doubt that the balance of P70,879.72 represents
conclusively missing funds and that petitioner-accused is, in fact, chargeable therefor. The many
errors subsequently discovered in the audit examination, even by the Sandiganbayan, raise the
strong probability that had the re-audit/review he had requested been accorded him, the remaining
balance could have been satisfactorily accounted for.
At this juncture, it may not be amiss to state that considering the gravity of the offense of
Malversation of Public Funds, just as government treasurers are held to strict accountability as
regards finds entrusted to them in a fiduciary capacity, so also should examining COA auditors act
with greater care and caution in the audit of the accounts of such accountable officers to avoid the
perpetration of any injustice. Accounts should be examined carefully and thoroughly "to the last
detail," "with absolute certainty" in strict compliance with the Manual of Instructions. Special note
should be taken of the fact that disallowances for lack of pre-audit are not necessarily tantamount to
malversation in law. Imperative it is likewise that sufficient time be given examined officers to
reconstruct their accounts and refute the charge that they had put government funds to their
personal uses. Access to records must be afforded them within a reasonable time after audit when
disbursements are still fresh in their minds and not years after when relevant official records may
WHEREFORE, upon reasonable doubt, petitioner-accused, Catalino Y. Tinga, is hereby acquitted of
the crime of Malversation of Public Funds. Costs de officio.
SO ORDERED.
Teehankee, C.J., Yap, Fernan, Narvasa, Gutierrez, Jr., Cruz, Paras, Feliciano, Gancayco, Padilla,
Bidin, Sarmiento, Cortes and Grio-Aquino, JJ., concur.