F. E. Zuellig, Inc. vs. The Commissioner of Customs

decision

on the basis of the pleading and Customs records . As the f acts ar~ gathered from the pleadings and records of t he case ,· (pars . 1 to 7, Petition for Review, pp . 1-2, CTA rec., Admitted i n par . 1 , Answer , p 4 23 , CTA rec .) .as follows:

1.

Pe t i tioner herein is the loca s hip agent of the vessel ss "Hong Kong Container" whi c h arrived at the Port of Manila on August 3, 1 9~8 nder Reg i stry No e 1666 carrying , among 236

DECISION -

CTA CASE NO. 3542 - 2 - others, f ourteen (14) pallets said to contai 758 cartons with mark~ "Pfizer Laboratory , Inc • cons igned to the Order of Commercia l Bank and Trust Company, Makati, Metro Manila , covered

by Bill of Lading

o . 803 .

2.

In the Inward Foreign Manifes of

the abovementioned vessel, only fourteen (14) pallets were declared but the numbe r of ca t on was not indi cated .

3.

Because of t he f ailure to declare the 758 c artons contained in the 14 pallet s, an amendmen t to the Inward Foreign Manifes t was submitted by t he shi pp i ng company and approved by the Bureau of Customs "'i t h the condition : "wi tho t prejudice to an administrati ve action against the ve s s (~l ."

4.

Due to the i naccurate declaration of the shipment covered by Bill of Lading No . 803 , t he Bureau of Cus toms sent a letter-complaint dated August 17, 1978 to the petitioner herein informing i t of i ts violation of Sec. 1005 in relation to Section 2 52 ~ of the Tariff and Customs Code , as amended .

5.

Af t e r hear ing , the Collector of Customs imposed an administrative f ine of P30 ,0 00 on t he vessel SS"Hong ~on g Container ". 6 .

Petitioner herein filed a Motion f or Reconsideration which was denied . On appea , the Comm i ssioner of Customs affi rmed the decision of t he Collector of Customs.

Hence, t his petition f or r eview.

(Pp . 1 & 2, Petition , admitted in p . 23 Answer ) •.

Petitioner herein have raised the argument tha t the decla ation in the oiig ina l manifest of the cargo as "14 Palle t s Pen Type Vial " is a substantial compl iance of the pr ov i sions of Sect i on 1005 of the ~a ri ff and Customs Code .

It asserted t hat to requ i re a more detailed descripti on would be too strict an interpretation of the 237

J

DECIS ION -

CTA CASE NO . 3542 - 3 -• law and would on y hamper commerce and serves no purpose since the custom authoritie s are al ready appr ised of the subj ect shipmen t s, as 19palletized" and, ~here fo re, con- taining a number of cartons r eadily determinable as to the number and dec l ar ed weight . It further a l l eged t hat s d0ect manifes was, a t any r ate amended v.rhich is allowed under Section 1005 , of the Tariff and Cus t oms .

And this fact did not in any way depr i ved the government of t he taxes and duties ue t here- one It f inally ins ists tha t t he amendment only shows tha there exists no intention to misdecl are the s ubj ect shipment and, ther efore , it did no violate any provisi on of l aw Respondent , on the ot her hand , contends tha t petit ioner had failed to c omply with the requireme~t of l aw that every vessel comi ng from a for e i gn por t must have a complete and accurate mani f est of all i ts cargoes , and that the manif est s hould include the quantity as well as the description of the packages.

Respondent fur ther contends that subject sh ipment should have been manifes ted as containing 14 pallets of 758 cartons containing 114, 000 pes. Pen Type Vials No . 50 Type III i nst ead of onl y "14 Pallets Pen Type Vials " s tated i n the cargo manifest . The sole i s sue before this court is whether or ot the vesse SS "Hong Kong Conta iner 10 had conveyed t he a i d 238 ·'

DECISION -

CTA CASE NO .

542 - 4 - cargo withou t its proper and accurate manifes , i viol ation of Section 1005, i n rel a tion to Secti on 2521 of the Tariff and Customs Code . We find r espondent ' s contention mer itor ious s The pertinent provisions of the law applicable in t his case is Section 1005 , t aken i n relation to Section 2521 , of the Tariff and Customs Code, provides as fol lows : "Sec. 1005 .

Manifest Requ ired of Vesse From Fore i gn Port. - Evary vessel fr om a for e i gn port must have on board a complete manifes t of al l her car go .

All of the cargo intended t o be l anded at a port in the Philippines must be escr ibed in separ ate manifests for each port of call t herein . Each manifest shall i nclude the por t of depar t ure and the por t of delivery with the mar ks , numbers, quantity and descript ion of the packages and t he names of the consignees thereof . Every vesse from a for eign port must have on board complete manifests of passengers and their baggage , ' n the prescribed f orm , s e t ting f9rth theoc destination and all particutars required by the i mmigration l aws ; and every such vessel shall have prepared for presentation to t he proper customs official upon arrival i n por t s of the Philippines a complete list of all sea stores then on board .

If the

vessel does not carry cargo or passengers t he manifest must show that no cargo or passenger, as the case may be, is car ied fr om the port of departure to the por t of destination in the Phil i ppines.

A cargo martifest shal l in no case be changed or alte red afte entr y of the vessel, except by mean s of an amendment by the mas er , consignee or agent thereof , under oath , and att ached to the or i ginal mani fest :

Provided , howev~ , That after t he i nvoice and/or entr y covering an i mp~rtation have been r eceived and recorded in t he office of t he appraise n o amendment of the a i est shall be llowed , except when it is obviou that a cler i cal error o any other discrepancy has been 239

DECISION -

CTA CASE NO. 3542 - 5 commi t t ed i n the preparation of the manif est , wi thout any f raudulen i nt en , discover of wh i ch coul d not have been made nti after examination of the impor tat i on has been comp eted.

And Secti on 2521, of the Tariff and Customs Code , as amended , prov ides as follows:

Sec . 25 2

- Failure to Supply Requisite

Manifests.

I

any vessel or aircraft enters or departs f om a port of entry wi t hout sub- mitting the proper manifests to the cW:oms author i t ies , or shal enter or depart con veying unmanifested cargo ot her than as stat ed in t he next preceding section hereof, such vessel or a ircraft shall be fined an amoun not less t han ten thous and pesos (PlO , OOO . OO ) but not exceeding thirty t housand (P30 , ooo. oo f pesos.

The same fine shall be i mposed upon any arr1v1ng o departing vessel o airc r af t "f t he master or pilot in command shall fa i l to de l i ver or mail to t he Commission on Audi t a true copy of the manifest of the incoming or outgoing c argo , as required by la • As amended by P.D. No. 1258-A . ).

, The issue in the c ase at bar is not one of f irs i mpressi on .

Numerous cases involving the same i s sue had a r eady been decideQ by t his Cour t to the effec t t hat every ves sel c oming from a f oreign port must have a comple te and cor rect mani f est . In this inst ant case , i t is to be noted that the Inward Foreign Manifes t of the vessel onl y mentions a cargo of fourteen ( 14) _pal ets u • but did not declare or stat e t he number ~f cartons in the aforesa id four teen ( 1 4 ) .Pallets . Defin i tely , the man e s t s ot , therefore , considered complete and 240

DECI SION -

CTA CASE o. 3542 - 6 '":' " correct .

I

had not me t the requirement of Section 252 the of Tariff & Cus t oms Code to/effect that the s hi pment should be marked , numbered , and the quantity as well as the descript i on thereof should be s tatede .

I

only t o be specific , we s hall only cite one of t he cases decided by t hi s court, and that is the case of Campania General de Tabacos de Fili pinas vs. The Comrnis- sioner of Customs , C.T.A. Case No . 2522, Februa r y 9 , 1977 , wher e in we hel d thus - The i ssue before us is not one of tirst i mpress i on .

It is a ready well s ettled t hat when a vessel f r om a foreign por t c arries and discharge unmanifested cargoes a our ports r it i s liable fo violati on of Sect i on 1005 and 2521. of t he Tariff and Customs Code. The defense of honest mista ke , l ack of fr audulent i ntent to defr aud t he government, o good fai th , is f utile and will not relieve the vessel f r om l abili t y .

The law clear ly makes it an i mperative obligation every vessel corning f ~ om a foreig port to have on , board a compl e t~ and corr ec t manifest of all i t s cargo.

No excepti on i s made in the s t atute and any attempt to read one i nto it, could · hardly fa il t o defeat the purpose of i ts ~nac - . ment e (U.S. vs. S~earnship " Rub i~, 32 Phil . 228 , 235-236; Smith Bell & Co . (Phi l . ) I nc . vs . Comm. of Customs , c . T •• Cases Nos . 1728 & 921, J uly 2, 1969; Macondray & o., I nc . vs . Comrn . of Custom , C.T. A. Cas e No . 1930 , Dec . 27 , 1969 ; Compani a Gene al de Tabacos de Filipinas vs. Comm . of Cust oms , C.T.A. Case No. 2143, J une 30, 1972; Macondr ay & Co., I nc e vs . Comm. of Customs , C.T.A. Case o . · 2082, Sep • 17 , 974; Campania General de Tabacos de Filipinas vs . Comm. of Cus toms , C.T. A. · Case No . 2144, J an.~ , 1976 : ) I t i s hardl y necessary to add : The e ident · n tent an objec t of these r equirements f or he s ubmis sion of manifes ts by a~~ vess e s from f oreign ports is to i mpose ' 241

DECISION -

CTA CASE NO . 3542 - 7 -,.

upon the owner s and officers of such vessels am ' mpe:rative obligation to s bmit lists of t he entire ading of the ship in t he prescribed form, in order to facilitate t he labors of the Cus toms and i mmigration of fice ~s , and t o defea any attempt to make use of such vessels to sec~re the unlawfu entry of persons o t hings into the Islands.

No exception is made in the statute , and t he recognition of any attempt t o read an exception i nto the statute could hardly fail to defeat t he purpose of its enactment .

(U.S. v. Rubi, 32 Phil. 235- 242; see also Macond:ray & Co., Inc.

s . Commiss ioner of Customs r CTA Cas o No. 1930 , Dec . 27 , 1969. ) . As· r egards the argumen of the petitioner to the effect t ha t wi th the amendment of the manife s t allowed unde Section 1005 of t he Tariff and Customs Code , the govern- ment was no deprived of its proper taxes and duties , and that the amendment would only show the absence of any intention to misdeclare the su bjec·~ shipment or to ' viol ate any law is of no significance . The rule is settled that under the aforesai d provision of Section 2521 of the Tariff and'Customs Code , no relief f rom liabil ity f or fine i s granted even if an amendment t o the manifes t is allowed .

In the case of Macondray & Company, Inc., vs . Commissioner of Customs , C.T. A. Case No . 2167, February 14, 1973 , this Court held as fol lows: \ On the matter of amendmen of t he cargo man e s v this Court ·n case of Compania • General de Tabacos de Filipinas vs . Commissioner of Customs, .T.A. Case No .

939 , dated February 26, 1971, held:

242 •

DECISION -

CTA CASE NO .

542 8 Peti ioner further asserts that 11the pr ovision of t he l aw on amendment i s designed to protect the master , agen o consignee fr om the e ro , mistake or discrepancy committed by him· in t he preparation of the or i ginal manife 9t and that it is unfair and uncal l ed for to conclude , as t he responden hel in t his case, t ha the right to amend t he manifest is for the pr incipal purpos of ~ P otecting innocent i mporters e"

Whether

the purpose of the aw i n permitting amendment o a vessel 's manifest i s t o protect t he master , agent or cons ignee of the ves sel , or the i mporte of t he goods , is to our mind of slight signi- f icance .

Unde r Section 2521 of t he Tariff and Customs Code, no r elie f fr om liabi li t y for t he f ine i s grant ed where an amendment of the manifes t is a l l owed . (Underlin ing s upplied . ) .

Taking however into cons ideration ~he entire circums t ance s of the violation , we find that th ~ imposed admhistrative f ine in the amount of Thirty Thousand

Pesos

( ~ 30,0 00 .0 0 ) ~ n d er t he circumstances , and t o our mind , harsh and exc~ss i ve .

We are of the opinion and so hold t ha t t he reasonable administrati ve fine should only be Ten Thous and Pesos (PlO , OOO. OO). .

.

WHEREFORE , t he appealed decision i s her eby modified by r educi ng the i mposed admini s t r ati ve fine f rom P30,000 . 00 to PlO,O OO.OO which pe t itione is he reby order ed to pay to the Bureau of Customs , Manila, withi t hirty (30) .days f r om the date the deci~ion becbmes f inal • 243

DECISION -_

CTA CASE NO. 3542

WE CONCUR:

hare

AMANTE FALLER

Presiding Judge

244