This is an appeal from the decision of the Auditor General denying the claim of petitioner for the payment of 7,926 boxes of ordnance items and  20 radial engines withdrawn by the Armed Forces of the Philippines (AFP)  from Ordnance Sub-Depot No. 6, located at Isaac Peral, Manila.

Under the Roxas-Vegelback Agreement signed  in  Manila on September 11, 1946, and approved by the  Philippine Government by virtue of Republic  Act No. 33, vast amounts of property, especially war materials, which had been declared surplus to the needs of the Government of the United States of America and which were found  necessary for the reconstruction and rehabilitation of the Philippines, were transferred to the Philippine Government, and  the President of the Philippines was authorized to administer said surplus property and to sell or dispose of so much of the same as may not be needed by the Government,  its subdivisions, and instrumentalities.

Part of said surplus property was the fixed installations and movable goods located at Ordnance Sub-Depot No. 6, Isaac  Peral, Manila. It was the intention and policy of the Government to first satisfy and meet the needs of its agencies and instrumentalities, such as the Armed Forces of the Philippines, before disposing of said surplus property.   And  so on  October 6,  1948,  the defunct Government Enterprises  Council  (GEC)  approved  and  turned over  to the AFP, all  combat materials  located  in said depot.  Subsequently, on  February 6 to 25, 1949, the property in said depot was  placed on negotiated  offers. In said offers,  the following clause was specifically inserted:

"Excluded:  A11 combat  materials (military, weapons, gun parts and accessories) that may be  found,"

Pursuant to said clause, representatives of the AFP were authorized by the Chairman of the Surplus Property Commission (SPC) on March 18, 1949 to earmark and take delivery by  means of memorandum receipts all such combat materials as they needed from said depot, in addition to military  weapons, gun parts, and accessories; and on March 25, 1949, the SPC Chairman ordered the said depot closed for customers' inspection until the AFP had completed withdrawal of  combat  materials  located therein. Two  months later, or on May 3, 1949, the AFP  was  requested by the SPC to issue a certificate of release for the said depot in order to  facilitate the early liquidation and disposition  of  the remaining contents thereof. However, the  AFP representatives found that  about 70 %  of  the items located at the depot fell under the category of combat materials; that the ear-marking and withdrawal of the same would require a longer period of time; and so, the then Chief of the Ordnance Service, Col. Benjamin C.  Molina, informed the SPC in his 5th  indorsement dated May 5, 1949, that  the AFP  would offer  no objection to  the release of Sub-Depot No. 6, subject to the condition imposed in the 2nd  indorsement dated March  24,  1949, namely:

"* * * the AFP retains the exclusive right to screen all  the items as soon as the buyer starts hauling them from the depot. The AFP representative will require the buyer to  open the boxes and inspect the contents before they are hauled from the depot.  Any combat material which is found to be within the  AFP requirements and which may be considered dangerous to public safety will be segregated by the AFP representative and wilt be withdrawn by the AFP. (Italics supplied; Exhibit  N, Annex  A)

Thereafter, or on July  12, 1949,  the Control Committee of the GEC, upon recommendation  of  the SPC, approved the negotiated sale of the remaining  fixed installations and movable property located at  Ordnance Sub-Depot No.  6, Isaac Peral, Manila, to  the Fil-American Irregular Troops, represented by petitioner Sixto  Celestino for  the sum of P42,000, plus  compensating  tax, or a  total of  P44,100. After the approval of the negotiated sale, Invoice, No. 10644, dated July 15, 1949, covering the property sold was issued to the vendee, and possession of the depot was  delivered to it under Tally-out Sheets dated August 26, 1949.

In this connection, it should  be  stated that before the sale, the condition imposed by  Col. Benjamin C. Molina, contained in his indorsement of March 24, 1949, as already reproduced, was called to the attention of Celestino, representative of the vendee, and  he  signified his written conformity thereto  in  the very same 5th  indorsement, :as follows:

"We hereby agree to the condition set  in the 5th indorsement above by Benjamin C. Molina dated  May 5, 1949.

                                                                         "Fil-American Troop Division
                                                  By:  "(Sgd)   MAJOR BONIFACIO CASTILEJOS
                                                                       "(Sgd.)  SIXTO CELESTINO

Furthermore, the sales  Invoice No.  10644 (Exh. T. Annex A), evidencing the sale to petitioner contained  this clause:

"Excluded: All combat materials  (military  weapons,  gun parts and accessories) that may be found."

This same clause also appears in  the Tally-Out Sheet, (Exh. W, Annex A) signed by petitioner,  evidencing the delivery to petitioner of the installations  and articles found therein.

About three months after the sale of the depot in question or on October 19 to December 6,  1949,  authorized representatives of the  Ordnance Service,  AFP, withdrew certain items therefrom, among, them,  7,926 boxes of  ordnance materials and 20 radial engines.  Petitioner demanded payment for the same, but the AFP refused to  pay on the ground that ownership over said materials never passed to the petitioner, the same having been expressly excluded from the sale.  Petitioner appealed to the Secretary of National Defense who affirmed the stand taken by the AFP; thereupon petitioner took the case to the President of the Philippines  who, on December 7, 1951, denied petitioner's claim.  A motion for reconsideration was equally denied on April 28, 1955.  Petitioner requested the President  to give his consent to the filing of a suit against the AFP, which request was referred to the Secretary of Justice for comment.  In view of the recommendation of the Secretary of Justice that the provisions  of  Commonwealth Act No. 327 be brought to the attention of the petitioner, the latter filed his claim with the Auditor General on June 21, 1955. After  due hearing the Auditor  General on February  6, 1957, rendered a decision disallowing the claim.   Petitioner is now appealing from said denial to us.

Pending appeal in this Court and before the parties had filed their briefs, the Solicitor General filed a motion to dismiss the appeal, claiming that  the same was perfected beyond the 30-day period prescribed by law for the reason that a copy  of the Auditor General's decision was received by the petitioner on February 12, 1957 and the notice of appeal was  filed with the Auditor General only on March 27; 1957, while the petition for review was filed with us on March 28, 1957.   By resolution of May 29, 1957, said motion to dismiss the appeal was denied.  The said resolution was  presumably based on the fact  that the  petitioner's motion for reconsideration of the Auditor General's  decision  suspended the running of the period for appeal.  The Solicitor General in his brief reiterates his motion for dismissal of the appeal,  contending that a motion or petition for reconsideration of the Auditor General's decision does not suspend the running of the period for appeal; and in support of his contention, He cites I Moran, Rules of Court, 1952  Ed., p.  949, citing the case of  Jalandoni vs. Sison, G. R.  No. 48884.   Unless we set aside our resolution  of May 29,  1957, denying  the  motion  to dismiss the appeal which wet see no reason  or occasion  for doing, the present appeal stands.  And  because of the view we take of this case and the conclusion which we have arrived  at, the result  would be the same.   However, for the satisfaction of counsel for the Government,  we wish to say that  in the relatively  recent  case  of  Pedro  M.  Libuet vs.  The Auditor  General,  G. R. No.  L-10160, June  28, 1957, the same  legal point was  involved, and  even this case of Jalandoni vs. Sison  was cited.   There we decided  that a petition for reconsideration of the decision of the Auditor General suspends the running of the period for perfecting an appeal.   Through Mr. Justice Labrador, we said:

"A point raised by the company is that the appeal is late, because petitioner had filed a  motion  for reconsideration of  the decision  of the Auditor General,  and  such motion does  not suspend the period for perfecting an appeal  to  this Court.  A decision of this Court (Jalandoni vs. Sison, G. R. No. 48884) cited in I Moran's Comments on the  Rules of Court p.  949, has been cited by the respondent  in support of the argument.  We have tried to check up the supposed source of the supposed ruling but have not been able to find that the ruling has been laid  down by us.  On the other hand,  we find that in  proceeding  before the courts  as  well as in those before administrative officials, the  constant practice has  been  to permit motions for reconsiderations and to deduct  the time used in the consideration  thereof from the  period for perfecting an appeal. We have found no reason for deviating from  this practice in matters coming  from the Auditor General; as a matter of fact the practice is in consonance with the  principle  of exhaustion of administrative remedies.  The claim  of  the  respondent that the appeal was perfected out  of time can not, therefore, be sustained."

On the basis of the facts of the  case  narrated  by us, particularly those  based  on the  documents presented in evidence  as exhibits,  the case appears to us quite clear as  to   require  no  extended  discussion.  From  the very beginning, petitioner was given to understand in clear and unmistakable terms, and he expressed his conformity thereto,  that all combat materials found  in the depot were to be excluded from the sale.  Those materials were not only those that had been removed from the depot by the AFP before the negotiated sale before the vendee took possession of the  depot  but. also those materials which were later removed by the AFP as being combat materials.  As a matter of fact the AFP, with the conformity of petitioner, has reserved the right to even open  the boxes and cases in which  the materials  were  contained  before they were hauled away by the vendee in order  to  examine the contents and remove therefrom all combat  materials.  In all probability, the reason why the vendee had agreed to  this was the relatively low price at which the sale was made: materials which had a procurement cost of over a million pesos, sold at the price of about P44,000  including compensating tax.  In this  connection,  we reproduce with favor pertinent portions  of the well written and well-prepared decision of the Auditor  General:

"The records show that the original procurement cost of the depot in question  was P3,620,568.00 but inasmuch as 70% of the items therein were  found to  be combat  materials and  reserved for the AFP, said procurement cost  was revised and lowered (for purposes of determining the selling price)  to P1,086,170.00 which is approximately 30% of the original procurement costs.   It is noteworthy that the negotiated sale of  said depot to the claimant was deemed acceptable and same was awarded to him by the GEC because his offer of P42,000.00 would yield a recovery of 3.86%.   (Resolution of the SPC dated June 20, 1949,  marked as Exhibit  "R" and letter of the Chairman, GEC, supra). By simple mathematical computation, we arrive at the incontrovertible  fact that  the amount of P42,000.00 paid by the claimant  is approximately 3.86%  of P1,086,170.00, the revised procurement costs representing 30% of the contents of the depot.  In  other words, in  determining  whether  the offer of the claimant would be a satisfactory selling price of the depot in question, the Surplus Property Commission took into  consideration the fact that 70% of the contents of the depot was already reserved for the AFP and cannot be included in  the sale.  The inescapable inference flowing from these circumstances  is that during the negotiation of the sale it was understood.and believed by the parties that the Surplus Property  Commission was selling and  the claimant was buying only non-combat materials which comprised more or less 30% of the original contents of Ordnance  Sub Depot No. 6, because the combat materials or the remaining 70% were already reserved for the AFP."

"Finally, it seems incredible that the Surplus  Property Commission would. sell the depot in question for only P42,000.00 if it were its  intention to include in such sale the materials in question, for if we were to believe the claimant, said materials would command a price of P2,919,000.00, the amount he is  claiming from the AFP. Such a deal would be patently unreasonable and  against the provision of Republic  Act  No.  38 directing the Surplus Property Commission  to  sell or dispose of the surplus properties 'under such. terms and  conditions  as  may be  deemed  advantageous'  (Sec. 2, supra).   Thus, the Supreme Court in the  similar case of Celestino M.  Dizon vs. the Board of  Liquidators, Etc.,  (G. R.  No. L-8416, Feb. 17; 1956)  stated:

"* * *  but  what makes the claim of the plaintiff unconscionable and unreasonable is  the  fact  that said materials  are worth more  than  P60,000.00, without including the other machineries, or, if we are to believe  what plaintiff himself said, they could have been sold for P281,250.00,  and yet he  only paid for the whole deal the paltry sum of P9,450.00.   Such a deal defies reason and common sense.  We doubt if the officials in charge of liquidating the surplus property would have  countenanced such deal  knowing it to be not only unreasonable but in  contravention of the purpose for which that property was turned  over to our  Government."

As to the  7,926  boxes of ordnance materials, as shown by the  tally sheets, they contained   among other things magazine  accessories for carbines, garands, grease guns, Thompsons; brush bore; staff cleaning rods; assorted spare parts for carbines,  garands, grease guns; stock buts; sight launcher grenade;  oil  accessory  for Cal. .30 M-I,  etc., articles, which were purely combat  materials; and as to the 20  radial engines which were used for tanks,  we  are convinced that they can be considered war materials.   We also reproduce  pertinent  portions  of the  decision  of  the Auditor General on this same point:

"The term 'combat materials' as used in the aforestated conditions and in the Sales Invoice (Exhibit "T")  was given a definite meaning. It was deemed to include  military weapons, gun parts and accessories'.  Guided by this concept, a perusal of the list submitted (Annex  B-3) by  the  claimant describing the ordnance items with' drawn fay the AFP, would readily, show that said items fall within the category of combat materials excluded from the sale. Likewise, the radial engines in question would  fall  within the  purview of combat materials contemplated in the contract of sale since as represented by the AFP, and this has not been impugned by  the claimant,  they  are  spare  parts  of  tanks. One can  hardly doubt that a tank is a military weapon.

"The  claimant seems to rely  on  the information given to this Office of Senator Zulueta, former Chairman of the Surplus Property Commission, to the  effect  that combat materials are classified into 'essentially combat materials  and non-essentially combat materials and that what  has been reserved for the AFP are only essentially combat  materials (t.s.n. Conference on April  17,  1956, pp. 9-11). With all due respect to the Senator, and without necessarily holding that the materials in question are 'non-essentially combat materials'. We cannot apply this classification to the instant case.  Apart from the fact that such classification  is only his personal opinion it is not backed up  by authorities  nor by existing rules and regulations of  the Surplus Property Commission,  at, the time the stipulations. in  the award  of sale and in the sale invoice of what are deemed included in the phrase 'combat materials' are  quite clear  and need no  further interpretation."

In view of the foregoing, the appealed decision of  the Auditor General is hereby affirmed, with costs.

Paras, C. J., Reyes, A., Labrador, Concepcion, and Endencia, JJ., concur.