dagumo

SURIGAO ELECTRIC, CO., INC. and ARTURO LUMANLAN, SR., petitioners,
vs.
MUNICIPALITY OF SURIGAO and HON. PUBLIC SERVICE COMMISSION,

G.R. No. L-22766 August 30, 1968

Facts :

The Public Service Act was further amended by the Congress on June 18, 1960. One of the changes introduced doing away with the requirement of a certificate of public convenience and necessity from the Public Service Commission for "public services owned or operated by government entities or government-owned or controlled corporations," but at the same time affirming its power of regulation, which while exempting public services owned or operated by any instrumentality of the government or any government-owned or controlled corporations from its supervision, jurisdiction and control stops short of including "the fixing of rates."

In this petition for review, petitioner Surigao Electric Co., Inc., a legislative franchise holder, and petitioner Arturo Lumanlan to whom, on February 16, 1962, the rights and privileges of the former as well as its plant and facilities were transferred, challenge the validity of the order of respondent Public Service Commission, dated July 11, 1963, wherein it held that it had "no other alternative but to approve as the tentative schedule of rates submitted by the applicant," the other respondent herein, the Municipality of Surigao.

Issue :

Whether or not a municipal government can directly maintain and operate an electric plant without obtaining a specific franchise for the purpose and without a certificate of public convenience and necessity duly issued by the Public Service Commission."

Ruling :

Citing the above amendments introduced by Republic Act No. 2677, respondent Commission answered the question thus: "A municipal government or a municipal corporation such as the Municipality of Surigao is a government entity recognized, supported and utilized by the National Government as a part of its government machinery and functions; a municipal government actually functions as an extension of the national government and, therefore, it is an instrumentality of the latter; and by express provisions of Section 14(e) of Act 2677, an instrumentality of the national government is exempted from the jurisdiction of the PSC except with respect to the fixing of rates. This exemption is even clearer in Section 13(a)."

The question involved is one of statutory interpretation. We have to ascertain the intent of Congress in introducing the above amendments, more specifically, in eliminating the requirement of the certificate of public convenience and necessity being obtained by government entities, or by government-owned or controlled corporations operating public services. Here, the Municipality of Surigao is not a government-owned or controlled corporation. It cannot be said, however, that it is not a government entity.

Petitioners' contention as to this alleged error being committed, therefore, far from being strengthened by such a reference, suffers from a fate less auspicious. No other alleged error committed need be considered.

WHEREFORE, the order of respondent Public Service Commission of July 11, 1963, as well as the order of February 7, 1964, denying the motion for reconsideration, are affirmed. Costs against petitioners.