Rl':Pl!I\I.IC of ·Nm Pll!!.Ll'Rlnll!I Court 0? T.', et al. vs. 'Rhe Comlihssioner of Customs

DECISION -

CTA CASE NO . 2559 - 2 - P 1 , 000 . 00 -

"Luna Maersk" - Administrative Case

No . V-614-71 for violation of Section 1005, in r elation to Sectio n 2521 , of the Tariff and Customs Code . There is no dispute as to the material facts a s borne out by the records of the Bureau of Customs . On diffe r ent dates in 1969, 1970 and 1971 , the vessels in ques tion , which are all owned and operated by the Haersk Line, a company engage d in inter-ocean shipping , and represented in the Phil ippines by their local ship agent, petitioner Compania General de Tabacos de Filipinas, ar r ived separately at the Port of Manila and discharg ed thereat various cargoes with- out being l i sted in their respective manifest , thus : S/S "Lica Maersk " - Registry No. 945

Date of Arrival -

May 29 , 1970

Cargo -

8 drums of Sodium Xanthate but only 3 dr ums were listed in the Inward Foreign Manifest.

S/S "Ceci l ie Maersk " - Reg istry No. 1268 Date of Arrival - October 15 , 1970 Unmanifested cargo - 4 drums i ndustrial essential oil.

S/S "Nicoline Maersk" - Registry No. 1513

Date of Arrival -

August 28, 1970 Unmanifested cargo 2 boxes personal effects consigned to Miss

Beatriz Fabaya of

Talisay, Cebu .

S/S "Lexa Maersk" - Registry No . 165 Date of Ar rival - January 25 , 1969 Unman i fes ted cargo 80 drums ci tric acid.

S/S "Luna Haersk " -

Regi s t r y No. 587

Date of Arrival -

March 27, 1969 Unman ifested cargo - 11 packages recording.

DECI SION -

CTA CASE NO . 255 9 - 3 -

S/S "Tobias Maersk" -

Registry No . 978

Date of Arrival -

June 20, 1970 Unmanifested cargo - 5 cases of truck parts.

S/S "Luna Maersk " -Registry No. 255 Date of Arr ival - March, 1971 Unmani fested cargo - 20 cartons of truck replacement parts.

After each incident, an amendment to the manifest of the vesse l concerned was filed by the ship agen t , Campania Genera l de Ta bacos de Filipinas, but the Bureau of Custpms approved each amendment with a notation: "without prejudice to an administrative action against the vessel."

Consequen t ly , in the middle of 1971, the Bu reau of Customs instituted administrative proceedings against the vessels , respect ively, to wit:

Administrative Case

No . V-600-71 S/S "Lica Maersk "; Administrative Case No . V-601- 71 S/S "Cecilie Maersk"; Administrative Case No. V- 602-71 "Nicoline Maersk"; Adminis trative Case No . V- 603- 71 "Lexa Maersk "; Admin i strative Case No . V- 604 - 71 S/S "Luna Maersk "; Administrative Case No . V-605 - 71 S/ S "Tobias Maersk" ; Administrative Case No . V-614 - 71 -- "Luna Maersk ": for violation of Section 1005, i n relation to Sect i on 2521, of the Tariff and Customs Code.

The administrative cases aforesaid were consolidated and jo i n t ly heard on August 31 , 1971, dur i ng which, petitioner Campan ia General de Tabacos de Filipinas, 337 ------------------..-- · · -~...,, ww,_.,,-. ·

- 4 - representing the vessels as respondent , offered the following stipulation of facts which was granted with- out objection on the part of counsel for the Bureau

of Customs:

" .l.

That the r.1aersk Line is a shipping company that operates vessels to and from Manila to the ports of the United States;

2.

That the respondent company, Campania General de Tabacos de Filipinas is the Philippine Agent of the Maersk Line;

3.

That Mr . Fiancisco de Guzman who is now present befo re the Honorable Heari ng Officer is an employee of the Campania General de Tabacos de Filipinas in its Shipping Department, who among other things is familiar with the mailing of the corre s pondence and the receipt thereof; 4 .

That more particularly in Administrative Case No . V-60 0-71 , we submit that the error herein, the figure 3 was typed in lieu of the f igure 8 is a clerical e rror and that it is understandable in v i ew of the fact tha t t he ordinary manifest easily contains over fifty

(50) pages with many hundred items, and t hat one clerical error in such a long document can be considered as an honest clerical mi stake; 5 .

In cases 601- 602 we submit that if Mr. de Guzman testify, he would testify that the items referred to in these cases were not included in the manifest because the original manifest sent from New York to Manila was delayed in the mail;

6 .

In proof of the f o r e go i ng, respondent is willing , if the Hearing Of f ice r so wishes, to submit xerox copies of the manifest in both these cases showing the date of receipt; 7 .

In cases 603-604, we incorporate by reference the deposition a l ready submitted to this Honorabl e Office in Administrative Case No . 476 , a copy of which we will submit to this Office should this Office so desire ;

338

DEC I SION -

CTA CASE NO. 25 59 - 5 - 8 .

The cross loading in both cases was due to the fact that there was confusion caused by the Pier strike that raged in New Yor k f r om the l ast month of 1968 to the first month of 1969; the evidence i n quest ion has already been submitted to this Honor able Office in a previous case ; 9.

In cases 605 and 614 , we submit that the Maersk Line possesses and operates a pier in New York, where only its vessels dock ~nd that i ts vessels dock there in numbe r s so that often t imes cargoe s intended f or one (1) vessel are loaded aboard another vessel due to the usual prevailing confusion in any pier and without thought of fraud so tha t items may appear i n the manif~st of one vessel of the company when the truth is they have been loaded aboard another vessel due to the confus i on in t he operation of the vessel x x x."

(Par . 5 , Pe- tition fo r Review, pp. 2 & 3 C.T . A. records, Admit t ed par . 1 , respondent' s Answer, p. 16, C. T . A. records ; also pp. 57, 60-62 ; Customs records & pp. 3-4 , Decision of Commissioner of Customs, pp . 111- 112 , Customs r ecords. ) On March 6, 1973, the Collector of Cus toms of the Por t of Mani la rendered a consolidated decision in these administrative cases imposing a fi ne of Pl , OOO .OO upon each of the vessels for violation of Section 1005, in relat i on to Section 2521, of the Tariff and Customs Code .

On appea l by petitione r , said dec ision of the Collector was affirmed by the Commi ss i one r of Customs on September 20, 1 97 3 . Henc e the present recourse .

The issue to be resolve d is whether or not the vessels in question a re each liable for the penalty of fine imposed by the Collector of Customs o f the Port of Man ila and affirmed by the Commissione r of 339

DECISION -

CTA CASE NO . 2559 - 6 - Customs for violation of Section 1005, in relation to Section 2521, of the Tariff and Customs Code, the pertinent provisions of which read as follows: SEC . 1 00 5 . - Man ifest Required of Vessel From Foreign Por t .- Every vessel from a foreign port must have on board a complete manifest of all her cargo.

All of t he cargo intended to be landed at a port in the Philippines must be described in separate manifests for each port of call therein.

Each manifest shall include the port of departu r e and the por t of delive r y with the marks, numbe rs , quantity and description of the packages and the names of the consignees thereof .

x x x .

If the vessel does not carry cargo or passengers the manifest must show that no cargo or passenger, as t he case may be, is car ried from the port of departure to the port of destinatio n in the Phil i ppines. A cargo manifest shal l in no case be changed or altered after entry of the vessel, except by means of an amendment by the master, consignee or agent thereof, under oath, and a ttached to the original man i fest; Provided, however, That after the invoice and/or entry covering an importat ion have been received and r ecorded i n the office of the appraiser, no amendmen t of the manifest shall be allowed, exc ept when it is obvious that a clerical e rror or a ny other discrepancy has been commi tted i n the preparation of the manifest, wi thout any fraudulent intent, discovery of which could not have been made until after examination of the importation has been completed.

SEC . 2521.

Failure to Supply Requ is ite Manifests. - If any vesse l or aircraft ente r s o r departs from a por t of entry without sub- mitting the proper manifests to the customs a uthor ities, or shall enter or depart convey- ing unman ifes ted cargo o ther than as stated in the next preceeding ~ection hereof, such vessel or aircraft shal~ be fined i n a sum not exceed ing ten thousand pesos .

- 7 - The argumen ts and d e fe ns es raised by petitioner i n its petition for review and memorandum are the same as those rai s ed by i t i n the administrat i ve proceed ings before the Bureau of Customs.

Thus:

In Administrative Case No . V-600-71 , the f ailure or omission t o manifes t the cargo was due to typo - g r aphical or clerical error because inste ad of the f i g ure "8" (eight LB7 drums o f Sodium Xan thate ) the figure "3 " was typed in the car go manifest . In Administrat ive Cases Nos. V-601-7 1 and V-6 02-71, the fa ilure to include i n the manifest of the articles involved was due to the delay in mails of t he original manifest s e nt from New Yor k (port o f loading ) to Manila.

In Administrative Cases Nos . V- 603-71 and V-604-71 , the f ai l ur e to manifest the cargoes involved was due to cross-loading because of the confusion brought about by a pier strike in the Port of New York . In Adminis trative Cases Nos. V-6 05 -71 and V-614-71, the f a i l ure to manifest the cargoes involved was also due either to cross-loading (or misshipment) because "the Maersk Line operates a pier in New Yor k, where only its vesse l s dock and that its vessels dock t here in numbers so that often times c a rgoes intended f or one (1 ) vesse l a r e loaded aboard a nother vessel d ue to the usua l p revailing confusion in any pier and - 8 - without thought of fraud so that items may appear in the manifest of one vessel of the company when the truth is they have been loaded aboa r d another vessel due to the confusion i n the operation of the vessel." On the other hand, respondent Commissioner of Customs contends that the requirement of Sect i on 1005 of the Tariff and Customs Code that every vessel corning from a foreign port must have on board a complete manifest of all her cargo is an i mperative obligation of the vessel, and since the law does not provide for any exception, the vessels in question are subject to the penalty of fine under Section 2521 of t he Code . In support of his contention, respondent cites the case of Smith Bell and Co., Inc , vs. Commissioner of Customs , C.T. A. Cases Nos. 1728 & 1921, July 22, 1969 ~ The Court agrees with the stand of respondent. In previous cases involving similar or identical issues , this Court has consistently and repeatedly ruled that the law makes it an imperative obligation of every vessel corning from a foreign port to have on board a complete and proper manifest of all her cargo, and to this mandatory requirement no exception i s allowed by the statute .

"Under Section 1005 of the Tariff and Customs Code , it is a n i mper ative obligation of every vessel from a f oreign port to have o n board a complete manifest of all her car- go.

No exception is mentioned i n the statute . 342

DECIS ION -

CTA CASE NO. 255 9 - 9 - Neither is there mention of any exception in Section 2521 o f said Code providing for a fine for vessels without proper manifests nor in Section 25 30 t hereof p r oviding the confiscation of unman ifested goods.

The recog n ition by the Court o f any a ttempt to read into the statute any excep t ion , suc h as misshipment of goods, would be con t r a ry t o the pervasive spirit as wel l as the clea r lang uage of the aforesaid provisions. (Smith Bell , & Co. (Phil.) Inc . vs. Comm.of Customs, CTA Cases Nos. 1728 & 1921, July 22, 1969 ; Campania General de Tabacos de Filipinas vs. Comm. of Cus t oms, CTA Case No. 2143, June 30 , 1972; Macondray & Co., Inc. vs. Comm.of Customs , CTA Ca se No. 2067, Oct. 6, 1972; Macondray . & Co . , Inc. vs. Comm. of Customs, CTA Case No. 2082, Sept . 17, 1974; Macondray & Co., Inc . vs . Comm. of Customs, CTA Case No. 2484, Jan. 1, 197 6 ; Campania General de Tabacos de Filipinas v s . Comm. of Customs , CTA Case No. 2144 , Jan. 5, 197 6 .)

(Underlining supplied.)

The fact tha t the omission to manifest a cargo was due to cler ica l error or shortshipment committed in good faith or without fraudulent inten t or that the vessel 's manifest was amended or corrected with the approva l of the Bureau of Cu s toms will not constitute a v a lid defense a nd relieve the vessel from liability . (See Macondray & Co ., Inc . vs. Comm. of Customs, CTA Ca se No . 2079, Sept . 29, 1972; Macondray & Co., Inc . vs. Comm . of Customs , CTA Case No. 2067, Oct. 6, 1972; Everett S t eamship Corp. vs. Comm. cf Customs, CTA Case No. 1968, Aug. 25, 1971, Certiorari denied in G.R. No . L- 34146, Oct. 7, 1971; Campania General de Tabacos de Filipinas vs. Comm. of Customs , CTA Case No. 1939, Fe b. 26 , 1971; Mac ondr ay & Co ., Inc. vs. Comm. of Cus t oms , CTA Ca se No. 1911, April 20, 1 97 0 ; Macondray '_) '· 3 ._) ".f.

- 10 - & Co ., Inc . vs. Comm. of Customs, CTA Case No . 1930, Dec . 27, 1969 , Certiorari denied in G.R. No. L-31599, Fe b . 10 , 1970.)

And as clearly and explicitly stated by the Supreme Court in the case of u.s. vs. The Steamship "Rub itt, 32 Phil . 223, the evident intent and object of these requirements for the submission of manifests by all vessels from foreign ports is to impose upon the owners and offic ers of such vessels an imperative obligation to submit lists of the entire lading of the ship in the prescribed form, in order to facilitate the labors of the Customs and immigration officers, and to defeat any attempt to make use of such vessels to secure the unlawful entry of persons or things i nto the country .

No exemption is made in the statute, and the recognition of any attempt to read an excep- tion into the law could hardly fail to defeat the purpose of the enactment .

(American Steamship Agencies, Inc., vs . Comm . of Customs , CTA Case No. 1851, May 3 , 197 7.)

Consequently, t he fact that the failure or omission to manifest the vessel 's cargo was due to a clerical error (Macondray & Co., I nc . vs. Commissioner of Customs , C.T.A . Case No. 2503, July 31, 1978), cross- loading (Compania General de Tabacos de Filipinas vs . Commissioner of Customs , C.T .A . Case No. 2781, September 3-1 ~1

- 11 - 30, 1977 ) misshiprnent or delay in the mails of the original manifest sent from the port of loading {See Campania General de Ta bacos de Filipinas vs. Commis- sioner of Customs, C.T . A. Case No. 2742, September 16, 197 7), wil l not exculpate the vesse l from the penalty of fin e p r escribed under Section 2521 of the Tariff and Customs Code.

We find no plausible r eason to depart fr om these rulings.

WHEREFORE , the decision of responden t Commissioner of Customs is hereby affirmed in toto, with costs against petitione r .

AMANTE ~~LE~ ~

Acting Pres i ding Judge I CONCUR: .J ~~~; g• ;RO:QUIN Assoc iate Judge 345