Confronting the Court in this instant petition for review on certiorari under Rule 45 is the task of resolving the issue of whether the pendency of a civil action for damages and declaration of nullity of documents, specifically trust receipts, warrants the suspension of criminal proceedings instituted for violation of Article 315 1(b) of the Revised Penal Code, in relation to P.D. 115, otherwise known as the "Trust Receipts Law".xl-aw

Petitioner Alfredo Ching challenges before us the decision1 [Court of Appeals Decision (Eleventh Division) penned by J. Gloria C. Paras and concurred in by J. Luis L. Victor and J. Fermin A. Martin, Jr.; Rollo, pp. 42-47.] of the Court of Appeals promulgated on 27 January 1993 in CA G.R. SP No. 28912, dismissing his "Petition for Certiorari and Prohibition with Prayer for Issuance of Temporary Restraining Order/ Preliminary Injunction", on the ground of lack of merit.

Assailed similarly is the resolution2 [CA G. R. SP No. 28912, promulgated on 28 June 1993; Rollo, pp. 49-55.] of the Court of Appeals dated 28 June 1993 denying petitioner’s motion for reconsideration.

As borne by the records, the controversy arose from the following facts:

On 04 February 1992,3 [Rollo, p. 42.] petitioner was charged before the Regional Trial Court of Makati (RTC- Makati), Branch 58, with four counts of estafa punishable under Article 315 par. 1(b) of the Revised Penal Code, in relation to Presidential Decree 115, otherwise known as the "Trust Receipts Law".

The four separate informations4 [Ibid., pp.42-43; Records, pp. 25-28 (Annexes A, A-1, A-2, and A-3, respectively)] which were couched in similar language except for the date, subject goods and amount thereof, charged herein petitioner in this wise:

On 10 February 1992, an "Omnibus Motion5 [Ibid., Records, pp. 29-32.] to Strike Out Information, or in the Alternative to Require Public Prosecutor to Conduct Preliminary Investigation, and to Suspend in the Meantime Further Proceedings in these Cases," was filed by the petitioner.

In an order dated 13 February 1992, the Regional Trial Court of Makati, Branch 58, acting on the omnibus motion, required the prosecutor’s office to conduct a preliminary investigation and suspended further proceedings in the criminal cases.

On 05 March 1992, petitioner Ching, together with Philippine Blooming Mills Co. Inc., filed a case6 [Ibid., pp. 56-63.] before the Regional Trial Court of Manila (RTC-Manila), Branch 53, for declaration of nullity of documents and for damages docketed as Civil Case No. 92-60600, entitled "Philippine Blooming Mills, Inc. et. al. vs. Allied Banking Corporation."

On 07 August 1992, Ching filed a petition7 [Rollo, p.43.] before the RTC-Makati, Branch 58, for the suspension of the criminal proceedings on the ground of prejudicial question in a civil action.

The prosecution then filed an opposition to the petition for suspension, against which opposition, herein petitioner filed a reply.8 [Ibid.]

On 26 August 1992, the RTC-Makati issued an order9 [Ibid.] which denied the petition for suspension and scheduled the arraignment and pre-trial of the criminal cases. As a result, petitioner moved to reconsider10 [Ibid., p. 44.] the order to which the prosecution filed an opposition.

In an order11 [Ibid.] dated 04 September 1992, the RTC-Makati, before which the criminal cases are pending, denied petitioner's motion for reconsideration and set the criminal cases for arraignment and pre-trial.

Aggrieved by these orders12 [Ibid., p. 42.] of the lower court in the criminal cases, petitioner brought before the Court of Appeals a petition for certiorari and prohibition which sought to declare the nullity of the aforementioned orders and to prohibit the RTC-Makati from conducting further proceedings in the criminal cases.

In denying the petition,13 [CA Decision in CA G.R. SP No. 28912, p. 3; Rollo, p. 44.] the Court of Appeals, in CA G.R. SP No. 28912, ruled:

Consequently, petitioner filed a motion for reconsideration of the decision which the appellate court denied for lack of merit, via a resolution14 [Rollo, pp. 49-55.] dated 28 June 1993.

Notwithstanding the decision rendered by the Court of Appeals, the RTC-Manila, Branch 53 in an order dated 19 November 1993 in Civil Case No. 92-60600, admitted petitioner’s amended complaint15 [Rollo, pp. 343-351.] which, inter alia, prayed the court for a judgment:

"X X X

In its amended answer,16 [Rollo, pp. 354.] herein private respondent Allied Banking Corporation submitted in riposte that the transaction applied for was a "letter of credit/trust receipt accommodation" and not a "pure and simple loan with the trust receipts as mere additional or side documents", as asserted by herein petitioner in its amended complaint.17 [Amended complaint in Civil Case No. 92-60600 filed before the RTC-Manila, Branch 53; Rollo, pp. 343-351.]

Through the expediency of Rule 45, petitioner seeks the intervention of this Court and prays:

The instant petition is bereft of merit.

We agree with the findings of the trial court, as affirmed by the Court of Appeals, that no prejudicial question exists in the present case. Scmis

As defined, a prejudicial question is one that arises in a case the resolution of which is a logical antecedent of the issue involved therein, and the cognizance of which pertains to another tribunal. The prejudicial question must be determinative of the case before the court but the jurisdiction to try and resolve the question must be lodged in another court or tribunal.18 [Tuanda vs. Sandiganbayan, 249 SCRA 342; Yap vs. Paras, 205 SCRA 625; Quiambao vs. Osorio, 158 SCRA 674; Donato vs. Luna, 160 SCRA 441; Ras vs. Rasul, 100 SCRA 125.]

It is a question based on a fact distinct and separate from the crime but so intimately connected with it that it determines the guilt or innocence of the accused, and for it to suspend the criminal action, it must appear not only that said case involves facts intimately related to those upon which the criminal prosecution would be based but also that in the resolution of the issue or issues raised in the civil case, the guilt or innocence of the accused would necessarily be determined.19 [Tuanda vs. Sandiganbayan, 249 SCRA 342.] It comes into play generally in a situation where a civil action and a criminal action are both pending and there exists in the former an issue which must be preemptively resolved before the criminal action may proceed, because howsoever the issue raised in the civil action is resolved would be determinative juris et de jure of the guilt or innocence of the accused in the criminal case.20 [Tuanda vs. Sandiganbayan, 249 SCRA 342 citing Librodo vs. Coscolluela, Jr., 116 SCRA 303.]

More simply, for the court to appreciate the pendency of a prejudicial question, the law,21 [Section 5, Rule 111 of the Rules of Court.] in no uncertain terms, requires the concurrence of two essential requisites, to wit:

Verily, under the prevailing circumstances, the alleged prejudicial question in the civil case for declaration of nullity of documents and for damages, does not juris et de jure determine the guilt or innocence of the accused in the criminal action for estafa. Assuming arguendo that the court hearing the civil aspect of the case adjudicates that the transaction entered into between the parties was not a trust receipt agreement, nonetheless the guilt of the accused could still be established and his culpability under penal laws determined by other evidence. To put it differently, even on the assumption that the documents are declared null, it does not ipso facto follow that such declaration of nullity shall exonerate the accused from criminal prosecution and liability.

Accordingly, the prosecution may adduce evidence to prove the criminal liability of the accused for estafa, specifically under Article 315 1(b) of the Revised Penal Code which explicitly provides that said crime is committed: Missc

Applying the foregoing principles, the criminal liability of the accused for violation of Article 315 1(b) of the Revised Penal Code, may still be shown through the presentation of evidence to the effect that: (a) the accused received the subject goods in trust or under the obligation to sell the same and to remit the proceeds thereof to Allied Banking Corporation, or to return the goods, if not sold; (b) that accused Ching misappropriated or converted the goods and/or the proceeds of the sale; (c) that accused Ching performed such acts with abuse of confidence to the damage and prejudice of Allied Banking Corporation; and (d) that demand was made by the bank to herein petitioner.

Presidential Decree 115, otherwise known as the "Trust Receipts Law", specifically Section 13 thereof, provides:

We must stress though, that an act violative of a trust receipt agreement is only one mode of committing estafa under the abovementioned provision of the Revised Penal Code. Stated differently, a violation of a trust receipt arrangement is not the sole basis for incurring liability under Article 315 1(b) of the Code.

In Jimenez vs. Averia,22 [22 SCRA 1380 (1968)] where the accused was likewise charged with estafa, this Court had occasion to rule that a civil case contesting the validity of a certain receipt is not a prejudicial question that would warrant the suspension of criminal proceedings for estafa.

In the abovementioned case, a criminal charge for estafa was filed in the Court of First Instance of Cavite against the two accused. The information alleged that the accused, having received the amount of P20,000.00 from Manuel Jimenez for the purchase of a fishing boat, with the obligation on the part of the former to return the money in case the boat was not purchased, misappropriated the said amount to the damage and prejudice of Jimenez.23 [Jimenez vs. Averia, 22 SCRA 1380 (1968)] Misspped

Before arraignment, the accused filed a civil case contesting the validity of a certain receipt signed by them. In the receipt, the accused acknowledged having received the aforesaid sum, in addition to the amount of P240.00 as agent’s commission. The complaint, however, alleged that the accused never received any amount from Jimenez and that the signatures on the questioned receipt were secured by means of fraud, deceit and intimidation.

In ruling out the existence of prejudicial question, we declared:

Furthermore, petitioner submits that the truth or falsity of the parties’ respective claims as regards the true nature of the transactions and of the documents, shall have to be first determined by the Regional Trial Court of Manila, which is the court hearing the civil case.

While this may be true, it is no less true that the Supreme Court may, on certain exceptional instances, resolve the merits of a case on the basis of the records and other evidence before it, most especially when the resolution of these issues would best serve the ends of justice and promote the speedy disposition of cases.

Thus, considering the peculiar circumstances attendant in the instant case, this Court sees the cogency to exercise its plenary power:

On many occasions, the Court, in the public interest and for the expeditious administration of justice, has resolved actions on the merits instead of remanding them to the trial court for further proceedings, such as where the ends of justice would not be subserved by the remand of the case.25 [Roman Catholic Archbishop of Manila vs. Court of Appeals, 198 SCRA 300 (1991)]

Inexorably, the records would show that petitioner signed and executed an application and agreement for a commercial letter of credit to finance the purchase of imported goods. Likewise, it is undisputed that petitioner signed and executed trust receipt documents in favor of private respondent Allied Banking Corporation. Josp-ped

In its amended complaint, however, which notably was filed only after the Court of Appeals rendered its assailed decision, petitioner urges that the transaction entered into between the parties was one of "pure loan without any trust receipt agreement". According to petitioner, the trust receipt documents were intended merely as "additional or side documents covering the said loan" contrary to petitioner’s allegation in his original complaint that the trust receipts were executed as collateral or security.

We do not agree. As Mr. Justice Story succinctly puts it: "Naked statements must be entitled to little weight when the parties hold better evidence behind the scenes."26 [Republic vs. Sandiganbayan, 255 SCRA 438, 472 (1996) citing The Ship Francis, 1 Gall. (US) 618, 9 Fed. Cas. No. 5, 035. Moore on Facts, Vol. 1, p. 579.]

Hence, with affirmance, we quote the findings of the Court of Appeals:

Contrary to petitioner’s assertions and in view of jurisprudence established in this jurisdiction, a trust receipt is not merely an additional or side document to a principal contract, which in the instant case is alleged by petitioner to be a pure and simple loan.

As elucidated in Samo vs. People,27 [5 SCRA 354 (1962)] a trust receipt is considered a security transaction intended to aid in financing importers and retail dealers who do not have sufficient funds or resources to finance the importation or purchase of merchandise, and who may not be able to acquire credit except through utilization, as collateral, of the merchandise imported or purchased.

Further, a trust receipt is a document in which is expressed a security transaction whereunder the lender, having no prior title in the goods on which the lien is to be given and not having possession which remains in the borrower, lends his money to the borrower on security of the goods which the borrower is privileged to sell clear of the lien with an agreement to pay all or part of the proceeds of the sale to the lender.28 [Black’s Law Dictionary.] It is a security agreement pursuant to which a bank acquires a "security interest" in the goods. It secures an indebtedness and there can be no such thing as security interest that secures no obligation.29 [Vintola vs. Insular Bank of Asia and America, 150 SCRA 578 (1987)]

Clearly, a trust receipt partakes the nature of a security transaction. It could never be a mere additional or side document as alleged by petitioner. Otherwise, a party to a trust receipt agreement could easily renege on its obligations thereunder, thus undermining the importance and defeating with impunity the purpose of such an indispensable tool in commercial transactions. Spp-edjo

Of equal importance is the fact that in his complaint in Civil Case No. 92-60600, dated 05 March 1992, petitioner alleged that the trust receipts were executed and intended as collateral or security. Pursuant to the rules, such particular allegation in the complaint is tantamount to a judicial admission on the part of petitioner Ching to which he must be bound.

Thus, the Court of Appeals in its resolution dated 28 June 1993, correctly observed:

In an order dated 19 November 1993, the RTC-Manila, Branch 53, admitted the amended complaint. Accordingly, with the lower court’s admission of the amended complaint, the judicial admission made in the original complaint was, in effect, superseded. Mi-so

Under the Rules, pleadings superseded or amended disappear from the record, lose their status as pleadings and cease to be judicial admissions. While they may nonetheless be utilized against the pleader as extrajudicial admissions, they must, in order to have such effect, be formally offered in evidence. If not offered in evidence, the admission contained therein will not be considered.30 [Evidence, 3rd ed., 1996, R.J. Francisco, p. 35; Director of Lands vs. Court of Appeals, 196 SCRA 94 (1991)]

Consequently, the original complaint, having been amended, lost its character as a judicial admission, which would have required no proof, and became merely an extrajudicial admission, the admissibility of which, as evidence, required its formal offer.31 [Javellana vs. D.O. Plaza, Enterprises, Inc. 32 SCRA 261 (1970)]

In virtue thereof, the amended complaint takes the place of the original. The latter is regarded as abandoned and ceases to perform any further function as a pleading. The original complaint no longer forms part of the record.32 [Torres vs. Court of Appeals, 131 SCRA 24 (1984)]

Thus, in the instant case, the original complaint is deemed superseded by the amended complaint. Corollarily, the judicial admissions in the original complaint are considered abandoned. Nonetheless, we must stress that the actuations of petitioner, as sanctioned by the RTC-Manila, Branch 53 through its order admitting the amended complaint, demands stern rebuke from this Court.

Certainly, this Court is not unwary of the tactics employed by the petitioner specifically in filing the amended complaint only after the promulgation of the assailed decision of the Court of Appeals. It bears noting that a lapse of almost eighteen months (from March 1992 to September 1993), from the filing of the original complaint to the filing of the amended complaint, is too lengthy a time sufficient to enkindle suspicion and enflame doubts as to the true intentions of petitioner regarding the early disposition of the pending cases. Ne-xold

Although the granting of leave to file amended pleadings is a matter peculiarly within the sound discretion of the trial court and such discretion would not normally be disturbed on appeal, it is also well to mention that this rule is relaxed when evident abuse thereof is apparent.33 [Torres vs. Tomacruz , 49 Phil. 913 (1927)]

Hence, in certain instances we ruled that amendments are not proper and should be denied when delay would arise,34 [Lerma vs. Reyes, 103 Phil. 1027, 1031-1032 (1958)] or when the amendments would result in a change of cause of action or defense or change the theory of the case,35 [Torres vs. Tomacruz , 49 Phil. 913 (1927)] or would be inconsistent with the allegations in the original complaint.36 [Guzman-Castillo vs. Court of Appeals, G.R. NO. 52008, March 25, 1988.]

Applying the foregoing rules, petitioner, by filing the amended complaint, in effect, altered the theory of his case. Likewise, the allegations embodied in the amended complaint are inconsistent with that of the original complaint inasmuch as in the latter, petitioner alleged that the trust receipts were intended as mere collateral or security, the principal transaction being one of pure loan.

Yet, in the amended complaint, petitioner argued that the said trust receipts were executed as additional or side documents, the transaction being strictly one of pure loan without any trust receipt arrangement. Obviously these allegations are in discord in relation to each other and therefore cannot stand in harmony.

These circumstances, taken as a whole, lead this Court to doubt the genuine purpose of petitioner in filing the amended complaint. Again, we view petitioner’s actuations with abhorrence and displeasure. Man-ikx

Moreover, petitioner contends that the transaction between Philippine Blooming Mills (PBM) and private respondent Allied Banking Corporation does not fall under the category of a trust receipt arrangement claiming that the goods were not to be sold but were to be used, consumed and destroyed by the importer PBM.

To our mind, petitioner’s contention is a stealthy attempt to circumvent the principle enunciated in the case of Allied Banking Corporation vs. Ordonez,37 [192 SCRA 246 (1990)] thus:

xxx......xxx......xxx

An examination of P.D. 115 shows the growing importance of trust receipts in Philippine business, the need to provide for the rights and obligations of parties to a trust receipt transaction, the study of the problems involved and the action by monetary authorities, and the necessity of regulating the enforcement of rights arising from default or violations of trust receipt agreements. The legislative intent to meet a pressing need is clearly expressed.38 [Lee vs. Rodil, 175 SCRA 100 (1989)]

In fine, we reiterate that the civil action for declaration of nullity of documents and for damages does not constitute a prejudicial question to the criminal cases for estafa filed against petitioner Ching.

WHEREFORE, premises considered, the assailed decision and resolution of the Court of Appeals are hereby AFFIRMED and the instant petition is DISMISSED for lack of merit. Accordingly, the Regional Trial Court of Makati, Branch 58, is hereby directed to proceed with the hearing and trial on the merits of Criminal Case Nos. 92-0934 to 92-0937, inclusive, and to expedite proceedings therein, without prejudice to the right of the accused to due process.

SO ORDERED. Man-ikan

Bellosillo, (Chairman), Mendoza, Quisumbing, and De Leon, Jr., JJ., concur.