72 CLC eee eeeeeeerrrreerere ee —————_ REPTRALIC OF T LUZ H. COLOQMA vs. " i

ll"'"nBT.TC nP' LUZ H. COLCJl'" • Petitioner, - versus -

COLLECT01 OF CUSTOJ• and

00 UfSIC.HER OF CU..<m:J~ , apondents.

x ..................... _ .. x

DEC ISI O

I

• 178 This is an appeal fre the d cision of the Commissioner of Customs dated July , 1~5 affir.- ing the decision of the CollectoR of Custo a of itanila dated 1 arch 18, 1955, which decreed the o~.

feiture in favor of the Government of 137 case& of various art1clea shipped sometlme in 19~ by tlosa- ka Trading, Ltd. of Yokohama , Japan . conai~ed to the hilippine Army Post Exchange , Ca ezon City.

zphy , It appears that on December 1 , 1953, the

S • ISAMlS

IENTAt•. a unit f the Philippine Navy, left. the Philip inea for Japan c rrying con- tingents of the 14th BCT to Pusan, Korea and Christ- • gifts for our soldiers there. ~ile in Japan, 180 cases containing various dutiable articles were load~ in said vessel.

The vess~l arrived in ~nila on eptember 2, 19~.

The said artielea ere cla - sified by Customs authorities into three groups, to witJ •(1) thos supposed to be for the Philippine Army Post Exchang~~ with an ppraised value of 127

D ISIOU •

CASE

• 178 $26,197. 53,

(2) those pertaining to the hilippine avy Officers Daae Com~~~iaaary , Cavi te; with an ap ... praised val of tl, 5 • 4 , ~nd (3) tho e 1 n ing te individuals , consisting of nine Philippine Army nd Na y offi era and c ew and two prlv te persona, wlth an nraised value of Sl,772.

• All these articles ere d clared forfeit~ by the Coll ctor of Cu t • of nila for violations of the C ste 1 Law in a deeisi n render on arch 18, 1955, hith aa affirmed by th Co ssion r of Customs on July 30, 195~.

This case relat a sol ly to the first a~:nm of articles c ntained in l 7 cases eonai ned to t • ilippine ost xchan •· The ca$ involvin th s cond reup of articles w s als ealed t this urt in rill C. T •• • 17 • ova be:r 14, 1956.

one of the eases involving the third roup which were 11kew1s ppe led to this Court hev already d cide •

(S

lunia v.

isai n r of Cust s, C. T •• 181 , ov be:r 14, 1956;

uval v. C iasioner of Custo a, c.r •. No.

1~, ove ber 14, 19~6; lnt n- gan v. Ca.miaaioner of CUst s, C.T. A. o.

S6, • November 14, 1956; l ea en v. C.-.tssion r sto s, C. T . A.

o. 184. ril 2 , 19~7. )

ln connection with the pr sent case, t • act •• ound by the Collector of CUsto s of nila, an confi ed by reapondent, are as followas It a pears that the Philippine vy vessel • a oia riental' (LST- ) ar- rived at this port frc Japan on S t er 1 2

D I Irt4 -

C.T •• CASE NO. 178 .. 3- 2, ~ 1th 180 paeka s containing var- ious dutia le article• as ca~ • e Hun z l'b!rty Seven {137) of t • cases are •.rked P , SV • CZB, , , A'.JJ, EA, TT, Ca u y , Quezon C1tyJ x x • • • presence of the$e dutiable goode on board the vessel was discover by t cutt • aut or1ties only after the interc cion by ort Patr 1 o ic an Con- aorci Javier of a truckload of cases leaving the Cust zone f m 'avy bo t, nd thr gh a confid ntial info ati n e- ceived in the Office of t e ort at 1 vlsio of tRis u~au xeg•rding t pr - • nee of c ecial g s on board •

S

' •• s Ori ntal• (LST-4 ) fro J•pan. T veriti the truth of t 1$ 1nf zmation, Col~ n • Turin n, t n .eral S rviaor of th• Security Division f t • eau cf Customs, and tty. Salvador acal'do, Chief of the lnveat1gat1on ection of th• Port Patnl Division, ent to Pi r 5 on Sept - ber 6, 19!>4 where the Philippine tiavy boat ntioned ab ve was th n d eked. ar- rival thereat, they ere et by tb CO • mending Offieez of the b ve-n v ss 1, _ho, hen ask d, nfcrm t e that ther were re lly co rc g s on o hi ship.

en th m rcha iae w~re b~ougbt t and x uin d at t c at s , th were found to b not cove~ed by the r - q\ll.r d carg ni st , ls o 1 ding, consular invoices, nd Centr 1 nk li- cense and rel•ase e rtificatea. lence.

the seizure.

X

X

X'

•As re9ards the first ne rs.

Luz i . Col a , ppear d uring n earlng nd claimed ownership of the g oda. he alleged that theGe goods w e s' by the Hoaaka Trading. Ltd. , of Yokoha a, Ja- pan, of which she is t authori%ed r re- sentative in the Philippines and that the same were ordered by the Armed Forces of t e bilip~ines Exchange Syst~.

In s port of her sec nd alleg ticn l.he p.r s n a letter dated S t..m.r 17, 1~2 . rked xhi- bit • 1 ... ' 1 signed by Captain vel1no ea a • wherein 1 t ap ears that the Aned · orces change wyst authorized lZ'S· C - loma to pu chase oods for her account and risk in Ja an to be delivered to tne LST of th• ArMed fcrces of the Philippines hich was to dock at Yo oha a , Ja an , in or around ...

1 29

DECISION ~

C.T.A. CASE NO. 178 a 4 « November, 1952. The geods were to be re~ ceived Mrs. Coloma in Manila from the LST and turn delivered and seld te the Armed Forces Philippines Exchange System. Mrs. Coloma claims that by virtue this letter, which has never been reveked, she had thrice ordered goods fer the Armed Forces Philip ge nase S System, the first of which, valued at 234,000.00, ar- rived in December, 62, the second, val- ved at #6,000.00, in June, 1953, and the third (the one now under seizure) on Sept~ ember 2, 1954. In respect te the third re mm ome Mrs. Coloma presented Exhibits oma’ to ‘'A.j9.Coloma', which are sees © ies of commercial inveices Sooued by the ke Trading, A og on Neve ember 8, November 29, Dec 4, December 7, and December 12, i953, covering 137 cases ef miscellaneous goods, which are ently are the same goods comprising = new under discussion. In ces, Hosaka Trading, Ltd. ap- to be the shipper, the Pest Exchange, , Nanay ty, the consignee, ppine Rosas | beat sailing en or he carrying vessel.

about Decenber rosbons the claim of Mre. Luz 4H. Co oma that said oods were ordered

by the Armed Forces Philippines Exchange

System is well taken.

"On September 27, 1954, the Acting Commissioner of Customs addressed a better te the Chief of Staff, Armed Forces of the Philippines, inquiring as to whether or not the goods in question have been ordered by the Philippine Arwy Pest Exchange. In the affirmative case, the Acting Commissioner of Customs requested the submission ae a copy of the order dul prop- er authorities. on beteher 2, 2. i Se aie tant General +0 hy S. Hernende, Armed For- ces of the Philippines, replied ‘that the said goods have not been authorized for consignment to the AFP Exchange System nor ordered the said system.' Hewever = Octeber 11, 1954, counsel for Mrs.

resented an affidavit executed Colonel melo Z. Sarbere on October 9, 1954 (ixhib- it 'F.Celoma'), which contradicts the infor- mation given in the Adjutant General's let- ter just mentioned. In this affidevit Cole. nel Barbero states: ‘That on or about October, 1953, while still Chairwan of the Central Post Council, AFP Exchange System, I placed an order for sundry items intended for resale by the Post Exchange te army per- 130 4g

ECISlaf·

C. T. • CA. E • 178 -5- aonnel, with the repr sent t.iv of the Ho- sa Trading , Ltd.

s.

u~ H. Cole .• • ( • l-4, D cision of Collector of Cu t~s , MarCh 1St 19!:5, cxh.

; PP• 16 -171, CTA records. 1 t b si of th fore oing fact , the Col- lecto% f Cu o s of anila order the forfeiture of aaid goods on t following ground$t -Evid nt y , it is not very m ter! 1 i in the instant case t d termin• heth r cr not the F Exeh nge yste aetu lly or- dered the goods.

lhether th y wer or- der• or n t, such goods 1 subject to forfeiture as m nifested cargo ( etio 1~63 L97 e ised minist% tive Code)& •• i~ortations d ·ithout rlor pe it fr t he C ntral Bank or any of its ent ank (Central nk Circ~ r ~o . 4~ in r la- t1on tc Section 13 3 ill cf the evised dministrativ Cod ); and a 1 ort tions de in violation of eutiv Ord r Jo.

328, the oods havin9 co .. e fro J pan. x X X . • ( ag 4, xh. G; P• 171, CTA r • cords .. )

Re pond nt affi th d cision of the 1- lector of Cuetom of I nila ordering the for itur of &aid go s on th gr unds specif1 d r he dec1- 1on of the latter d en th f urther gr und that aid goOdG re not c v r d by th t ui it eons 1 r invoic • purau t tc S ct1 na 17 and 1 f the Phil- ippin• Tariff Aet of 1 9.

•o cislon on p al•s e quote f respond t•s •And this ffic also takes eogn!Eance of t • att t at s .d fro th article clnimed by ppell nts Rub n Sanid d , Vi- c nt Laurel, 1- lb no Collantes. Jo e C ti g E tez eg la, ~hich re ec- tively ao OQt exc ed .00 i n dutiable alue. ll the rest, ith th exception of th e clai d by Folix • l e en r not cov xed by requisit consular in- voices s qui d by cti n 17 nd 18 of the Philippine ariff Act. end , c nseq ently, are au J ct to f orfeiture under ct1on 1363 (f) of th Revi ed ~ lnist tlv Code in conjunction ith 131 l a

DECISION ~

CeTeA. CASE NO. 178 = 6 » Section 1230 of the same Code.* (Page 5, Exh. Uj} page 291, CTA records. ‘See also records. .

Having failed to secure from respondent the reversal of the decision of the Collector of Customs of Manila, petitioner nas appealed te this Court.

It may be stated that before the case was heard on the merits, petitioner filed a petition seeking the release of the geods in question upon the filing of a bond under Section 1374 of the Administrative Cede. The petition was denied in our Keselution of Merch 3, 1956. (See pp. 82-85, CTA records; Exh. K. ) The motion for reconsideration was denied in our Re- selution of May 16, 1956. (Pp. 134-129, CTA records.)

We shall now consider the issues raised in this appeal. The first issue involves the question whether the goods in question are *unmanifested merchandise* within the meaning of paregraph (9) of Section 1363 of the Administrsetive Code se as to justify their forfeiture under said paragraph. This question has been extensively discussed in our decision in He- lunia v. Commissioner of Customs, C.T.A. No. iS], November 14, 1956, which involved merchandise brought by the RPS "MISAMIS ORIENTAL® on September 2, 1954. For convenience, we will just quote pertinent per- tions of our decision in said cases the adainastentive Gide relsed ypon “Entrance of vessole in fereign trade".

Obviously, the said Article lays down rules geverning the entry of vessels en- i3s2 A325

DECISION «

C.T.As CASE NO. 178 a gaged in fexreign trade. In fact, the heed- ing ef Section 122] statest ‘Ports open to vessels sidings a iczedcn trace ~ Duty of vessel to make entry’, the second aragraph thereof exempts from its opera- on the master of any war vessel or ves- sel employed by — gr eng Le mre $3 une ro a8 is enoad : ra pose of meking on ef a vasse) enue dn_foreian trade, t master shall pre- sen @ documents enumerated therein.

a x x x << "It does net appear that the APS "MISAMIS ORIENTAL", wi it arrived from oe and Ro ae on or gerwne Rey 1954, or or ©, Was cecup or sapaayer in the transportation of merchandise the way of trade; ae that 2k cata uously or habitually transporting qoods in fereion trade for hire. “Ye take it that respondent’s cenclusion has been ine ferred selely from the fact that said ves- sel carried on thet one occasion dutiable merchandise. ‘Ye do not believe that, under the circumstances, the said et foreign trade wi meaning of Sec- tions 1221 and ons of the Administrative Cede so as te require it to ‘report end enter’ on arrival in the Philiprines.

Rut, according to respondent - 'x x x Public policy makes ee the interpretation od phrases "a vessel engaged foreign trade* as used in Section

1225 of the Revised Administrative

Code, and “Every vessel from a for- eign port* as used in Section 1228 of the seme Code, in such a manner at to include vessels ovmed by the Government when they undertake the transportation of cargoes similar to the goods involved herein. ' (Page 8, Decision on Appeal of Res- pendent. )

"Public pelicy is shaped wed | $ alone and not any administrative official. Public policy is what the law Seyss not what any executive officer thinks it should be. The gone in regerd to the submission of manifests cf imported merchandise has been laid down by law in Article V1 of the Cus- 133

AP of

DECISION «

C.T.A.e CASE NO. 178 toms Law. There may be a gap or deficien~ cy in that law. In such a situation, the is an amendment of the law. deficiency can not be supplied by mere executive or judicial pronouncement for thet would be usurpation of the legisla tive power.

*Attention has been drewn te Section 1224 of the Administrative Code which re- quires the master of a trenspert or ~ ply ship of the United States Axrmy or Navy to present a manifest and other documents to the boarding officer or cellector of customs to show the necessity of « similar reavirement in regard te transport or sup- ply ships cf the Armed Forces of the Phil-~ ippines. x x xX.

"There is nothing in Section 1234 of the Administrative Code from which an inference may be drawn that the require- ments in regerd te transport or supply ships ef the U.S. Army or Navy are appli- cable to Philippine Navy vessels not en- gaged in foreign trade. If Congress ine tended to make Section 1234 applicable te Philippine Navy vessels, it should have so expressly provided. That Congress hes net so far amended the law is an in- dication of an intention to place Phil- ine Navy vessels beyond the scope of said section.

“Assuming thet Philippine Navy ves- sels are required to submit manifests, the existence of 2 manifest in this case has been sufficiently established. On September 17, 1954, the then Acting Come missioner of Customs wrote te the Chief ef Staff of the Armed Forces of the Phil- ippines stating thet, according to his information ‘a copy of the ship's mani- fest covering said cargo has been se- cured that Office from the Command. ing Officer of the vessel’, and requested that 2? copies of said manifest be furnished the Bureau of Customs. This letter was re- ferred te the Philippine Navy. © J. Francisce, Flag Officer in Command, wrete te the C ssioner of Customs trans- mitting twe copies each ef the manifests. a an "Commodore Francisce certified te the fact that the cargo on board the APS *MISAMIS ORIENTAL® when it arrived from

DECISION ~

C.T.Ae CASE NO. 178 ~9-«- am on September 2, 1954, were manifested, he furnished the Commissioner eof Cus- with two copies of said manifests. cargo officer of said vessel testified in Court thet he prepared said manifests. No evidence has been presented to contra- dict his testimony. Thet Philippine Navy authorities expressed doubt in regard to the epplication of certain provisions of the Administrative Cede to Navy vessels is no proof of the ebsence of such manifests. The manifests were cbviously prepared in compliance with Standing Cperating Prece- dure No. 12, dated February 15, 1953, of the Philippine Navy.

*But it is contended that the meni- fests were not in the form prescribed by the Bureau of Customs #8 required by Sece tion 1228 of the Administrative Cede. That section does not require that carge manifests should be in the ‘prescribed form'. It mere- ly requires thet every vessel from a foreign port must have on board a comlete written or typewritten manifests of all her ¢ ; that ell the cargo intended to be landed at each rort must be described in separate manifests for each port ef call} and that each manifest shall include the port of de- parture and the pert of delivery with the marks, numbers, quentity, and descriptien of the peckages and the names ef the con- signees thereof. The cargo menifests pre- sented in evidence in this case complied with all these requirements. The manifests which are recuired to be prepared in the prescribed form, under Section 1228, are the passencer manifests and not the cargo mani- fests, as shown by the fcllowing provisient eghy ‘Every vessel from a foreign port or place must have on beard complete manifests cf passengers, immigrants, and their baggage, aD » Setting fe eir destination and sll particue lars required by the immigration laws. x x x.' (Underscoring sup- Ne similar provision is made with respect to manifests. Ye are, therefore, of the ion that the manifests of the APS *MI S ORLENTAL® satisfy the requirements of the taw.*(Relunia v. Com. of Customs, CTA No. 181, Nov. 14, 1956. See also Nuval ve Com. of Customs, CT’ No. 155, Nov. 14, 1956; Brille v. Com. of Customs, CTA Ne. 176, Nev. 14, 1956; Icamen v. Com. of Cus- toms, CTA Ne. 184, April 2, 1957. )

139 APad

a A NA py ae er DECISI<l4 • C. T •

• CASE

• 178 - 10 - The second issue xelates to the question •hether or not th• rchandise in uestion a subject to for- felture f r violaticn of tral ank Circular No.

4~ .

this question, the Coll ectoz of Cust s of nil justifies t he forfeiture of said aerchandise on the foll ing provision of said C~rculars

X

X

X the Lfonetary

ard, X

X X

her by re ires any person or entity w intends t i~ort or receive good• fna any foreign ~ountry for hich no foreign txchan t is required or will be required of tbe benka , to pply for a license from the onetary Board to authoztz such iltport.

{~ee PP• 4-~ , Decision of Col .. lector of Q.aatoms of anlla • lB, 1~ , xh. G; PP• 171-172, CT records. )

a th basis for the forfeiture of tl\e rcha ise under Circular o. 45 is tb provision thereof re- qui.ring a license fro. th etary ard ~fore a person or entity may be authorized to i11port or re- ceive goods fro any foreign country fpr whish no fgrup axchygt it gguirtpd or J!iJ.l a. rtAMJrtd of the banka. it would se that tbe Collector f Cut- to s found a a fact that the 1 ortation in ea- tion doea not involve the sale of foreign exchan e. No charge had ever be~n m d during the proceedings in Seizure I dentification os. 1~ and i~- in the Bureau of Customs that the 1 ort tion i nvolves the sale of foreign exchange and that the iaporter failed to secure the necesaary li•ense fro• the -

Central Ban •

spondent ap arently concede• that the said t.portation does not involve the sale of foreiqn exchan e , but be nevertheless believes that it is subject to th licensing requir ents of said 136 I.Y/

DEClSICN •

C.T.A. CASE N • 178 - 11 - 1rcul r' W• quote frOJ'Jl h1a d•eiliont ith res~ et t the ~~nte tien that Central Bank Ci.rc:ulaz:a No&. 44 and 4~ do hot ply t t.portat~on not involving t e urchase •f foreign exchange as as- serted in t 4th e:r:ror. this fie h ~onsistently held in a long lin• of deei- sio at •a d circule:rs ply t all 1 ortat iona not falling under t e ex-.p- tions, whet er such ~~port ticna involved the purchase of foreign exchange oz not. • (Page ll, Decision on ' f>peal of Co • of Custoaa, Exh. lJJ a 297, CTA reeotda;

••• alao ~ill v.

om. of Custo s, CTA Jlo. 176, Nov. 14, 1~. )

v/It p earing that the 1aportat ion in question does not involve the sale of foreign exchange, we are of the opinion that the •• is not subject to fozfeiture for violation of Ci~eular No. 4$ of the central B kin relation to Section 1363 (f) of the iniatrative Code.

e have h•ld th

the Central

nk ha• no power to Z'it<JUlate 1~~portat1on of gooda fro. foreign countri .. wbi~h do not involve the 1 le f fore1 exchange~ Consequ-'ltly, C.ntnl Bank Circulars os. 44 end 45, in so far as they seek to regulate no-dollar 1 ortati ns, ar not valid~ (Leuterio v. Com.

f Custo s , C.T.A.

• 29, rll 18, 1955: -•~te 1 v. Com.

f Cu$toms, C.!.A. No.

96, Sept. 5 , 19 ~ . •ffim on anoth r groun in Q . R. No. L- 9810 .

il 27, 19~7, Pasc al v. David, C. T. f. .

~o. 94, Sept. 16, 1955;

ascual v. Co • of Customs, c. T. ~'\ • Noa. 14 148, Feb. 29, 1956;

Pascua v.

It w's Gnly af er th enact ent of epublic t No. 1410 on ~ t ~r 10, 95~ th t no-doll2r 1 - p rtations bee subject to regulation , but t h 137

DECISION «

C.T.Ae CASE NO. 178 ~ 12 « authority to regulate such importations has been vested in the Department of Commerce and Industry and net in the Centra] Bank. There is nothing in said Act from which any inference may be drawn that the power to regulate no-dollar importations, prior to its effectivity, was vested in the Central Bank or in any governmental agency. (See Nepomuceno

v. Com of Customs, C.T.A. Now 122, July 26, 1956; Jea Commercial v. Com of Customs, C.T.A. No. 144, Oct. 18, 1956; Auyong Hian v. Manahan, C.T.A. No. 219, Sct. 31, 1956; Brillo v. Com. of Customs, supzs; Santes ve Com of Customs, C.T.A. No. 235, Dee. 22, 1956; Serree investment v. Com. of Customs, C.T.A. Ne. 227, Jan. 5, 1957; Lorenzana v. Com of Customs, C.T.Ae No. 261, March 25, 1957; icamen v. Com. of Customs, C.T.A. No. 184, April 2, 1957. )

The third issue involves the queetion whether or not the said importstion is subject to forfeiture under Executive Order No. 328, series of 1930, Sec- tion 1 of which prevides that no importation of mer- chandise from Japan may be effected or attempted with- out proper license, and Section 14 provides that mer- chandise so imported shall be subject to forfeiture. The agency entrusted with authority to issue licenses for the importation of merchandise from Japan was the former Import Contro] Commission. However, st the time the articles here in questicn were imported, the Import Control] Commission had already ceased to éxist with the expiration of the Import Control Law (Republic Act No. 650) on July 1, 1953. Consequent- 138 /25 D lSI - C.T.A. ~~EN • 17 ... 13 - ly, the said importation ay not be forfeited for violation of said Executive O~dlr.

*Fr

th p visi ns (See. l) f Exe- eut1v• Ord r ~o. 328 • • • it will be seen ~hat the fun~ticn o issuin licenses for 1 ort w given to for er I ort Control Ada! istration (later the I ort Cont.t-ol C ssion) • while th licensing of exports was veated in t e C.entr l an.k.

Nothin) a.p ars in the said Ex • cutive Orde~ w ~c auth rites th C@ntral Bank, or any o e ove ntal entity rag ncy, aft r t e i&s lution of th lllpOrt Control Co i&S n . ...

issue u- e s for t e 1 o at on of rchandis • !ther ha th attenti n of thia Court b n dr to n r is it w r f the exi t nc of ny oth r la • execu~ive r- d r or r gulation "Jhich w rs the C r1t-rnl Bank to iatsu licen es m- ports. It follows that the forfeiture of the ship ent of onions c nsi ned to he etitioner finds no sanctien u •~ Executiv Ord J' tto. 32 • ( uteri v.

c • of Cut , c.r.A.

o. 96, s t . 5, 1955, affi n an th ground 1 G.

o. L-9 1r • ril 27, 1 7. )

inally, e~pon ent aff h d CiSl.O of forfeitur of t m :tchandi n qu stion n ground th t n con~ul r invo~ w 6 r uced cov r - ing id er~h n s • in vi la i n of S ctic s 17 and 1 of tn PP• ~ . 1 , CTA reco lippin T :ri ct of 1 i9.

( p al , xh.

• • • 291, 299, ~titioner appa:r tly a its t e absene ot cons 1 :r invo c , or ny uoc ent. n lieu ther of, a • e s not pp led fro that portion of th d cis n a i ang t decree of forfeiture on th t gro n • he s id 1 crtation is, tb refore, s bj ct to f rf iture fo violation of Sections 17 nd 18 of t • Philippine Tariff ct of 1909. in rel ticn to ~ cti n 1363 ( ) of t e mini • 139 /~tf

DECISION «

C.TeAe CASE NO. 178 . - 14 « trative Code.| (Nuval v. Commissioner of Customs, G.T.A. Neo. 185, November 14, 1956. )

FOR THE POREGOING CONSIDERATIONS, the deci- sion appealed from is hereby affirmed solely on the ground that ne consular invoice has been pre- sented covering seid importation, in violation of Sections 17 and 18 of the Philippine Tariff Act of 1909. With costs against petitioner.

SC ORDERED, Manila, March 10, 1958.

CHA. dt es ‘9h pre BFC 4 Ck he kelp Al] JVidv. 2g /$6O.

140

Joe #

a gee — ee 7 « RN