Natalia Realty Inc and Estate Developers & Investors Corp vs DAR

FACTS:

• Petitioner Natalia is the owner of three contiguous parcels of land located in Banaba, Antipolo, Rizal.
• On 18 April 1979, Presidential Proclamation No. 1637 set aside 20,312 hectares of land located in the Municipalities of Antipolo, San Mateo and Montalban as townsite areas to absorb the population overspill in the metropolis which were designated as the Lungsod Silangan Townsite. The Natalia properties are situated within the areas proclaimed as townsite reservation.
• EDIC, developer of Natalia, applied for and was granted preliminary approval and locational clearances by the Human Settlements Regulatory Commission. Petitioners were likewise issued development permits after complying with the requirements. Thus the Natalia properties later became the Antipolo Hills Subdivision.
• On 15 June 1988, CARL was enacted.
• DAR, through MARO, issued a Notice of Coverage on the undeveloped portions of the Antipolo Hills Subdivision which consisted of roughly 90.3307 hectares.
• Natalia and EDIC protested to this.
• Members of the Samahan ng Magsasaka sa Bundok Antipolo, Inc. (SAMBA), filed a complaint against Natalia and EDIC before the DAR Regional Adjudicator to restrain petitioners from developing areas under cultivation by SAMBA members.
• DAR Regional ruled by temporarily restraining petitioners from further developing the subdivision.
• Petitioners elevated their cause to DARAB but the latter merely remanded the case to the Regional Adjudicator for further proceedings
• Natalia wrote respondent Secretary of Agrarian Reform reiterating its request to set aside the Notice of Coverage. Neither respondent Secretary nor respondent Director took action on the protest-letters.
• Hence, this petition.
• Natalia’s contention: Subject properties already ceased to be agricultural lands when they were included in the areas reserved by presidential fiat for townsite reservation.
• OSG’s contention: The permits granted petitioners were not valid and binding because they did not comply with the implementing Standards, Rules and Regulations of P.D. 957, otherwise known as "The Subdivision and Condominium Buyers' Protective Decree," in that no application for conversion of the NATALIA lands from agricultural to residential was ever filed with the DAR. In other words, there was no valid conversion.

ISSUE: Whether or not the subject properties shall be included in the coverage of CARP

HELD:

• NO.
• Section 4 of R.A. 6657 provides that the CARL shall "cover, regardless of tenurial arrangement and commodity produced, all public and private agricultural lands." As to what constitutes "agricultural land," it is referred to as "land devoted to agricultural activity as defined in this Act and not classified as mineral, forest, residential, commercial or industrial land. The deliberations of the Constitutional Commission confirm this limitation. "Agricultural lands" are only those lands which are "arable and suitable agricultural lands" and "do not include commercial, industrial and residential lands."
• Based on the foregoing, it is clear that the undeveloped portions of the Antipolo Hills Subdivision cannot in any language be considered as "agricultural lands." These lots were intended for residential use. They ceased to be agricultural lands upon approval of their inclusion in the Lungsod Silangan Reservation.