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Sandigan exonerates ex-Petron executives in tax credit scam

The graft charges against four former executives of Petron Corp. were dismissed by the Sandiganbayan in connection with the accusation that they defrauded the government of P700.74 million in taxes.
The case against former Petron president Monico Jacob, vice president and general manager Celso Legarda, vice president for refinery Apolinario Reyes and senior marketing executive Rafael Diaz Jr. was in connection with the 1990 tax credit scam.
The Sandiganbayan Special Fourth Division, in two separate resolutions, upheld the motions to dismiss filed by the former Petron executives.
Earlier, the Supreme Court had ruled that the oil giant was in good faith when it bought tax credit certificates (TCCs) from garments firms that were allegedly obtained them from the Department of Finance (DoF) with fraudulent documents.
Some 48 graft charges lodged against Legarda were dismissed while the cases of his co-accused in 18 graft charges were also junked. The charges against another executive, Reynaldo Campos, were dismissed due to his death.
The mentioned executives of the giant oil firm and Pilipinas Shell Petroleum Corp. were cited in the said scam for buying the TCCs to apply against their own tax liabilities.
The res judicata, the principle barring courts from relitigating a settled issue, was used by the anti-graft court as basis for dismissing the cases and also cited the SC ruling that cleared the said oil firm of tax liabilities due to the cancellation of the spurious TCCs.
In its resolution, the Sandiganbayan stated that Legarda was found not to be a party to the fraudulent issuance and assignment of the TCCs and was considered as a transferee in good faith and for value.
The bulk of the graft cases was in connection with the Petron’s use of 276 TCCs worth a total of P700,741,929 which were bought from 18 garments exporters, namely, Filsyn Corp., Dragon Textile Mills, Inc., Southern Textile Mills, Inc., Fiber Technology Corp., Diamond Knitting Corp., Filstar Textile Industrial Corp., R.S. Textile Mills, Monti Textile Mfg. Corp., Master Colour System Corp. First Unity Textile Mills, Jantex Philippines Inc., Unisol Industries and Mfg. Corp., Southern Dae Yeong Corp., Solid Development Corp., Asia Textile Mills Inc., Phelps Dodge Philippines Inc., Alliance Thread Co. Inc. and Kewalram Philippines Inc.
The anomalies with regards to the issuance of TCCs were discovered by the DoF in July 1988 after fraudulent documents were allegedly submitted to the One-Stop Shop Inter-agency Tax Credit Drawback Center which was established in 1992 to fast track tax credit claims that allegedly resulted to P2.5 billion losses to the government in terms of revenues.

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