Esheraldo Loquilber, et al. vs. Commissionier of Custors

DECISION

The instant petition seeke for the release of twenty(20) bales af used clothings that were seized and ordered forfeited by the respondent tor allegedly being smuggled items. - | Petdtionves are vendore ian FPalac’s Supermarket in Iligan City and are engaged in business as retailers of merchandise including used clothing.

On September 14, 1989, the Customs Police of the sub-port of Iligan City intercepted the N/V Iligan City, an inter-island vessel plying the Ceta-+Iligan route, and confiscated from its cargo 20 bales af used clathing for (og) von «J

HEC TISION -

G.T.A. CASE NO. . 4847 Nw allegedly being violative af Republic Act Na. 4653, the rertinent portion af whith provides:

"HXX KM "eK Section 1. lt sholl he unlawful for any person, asgsnetiatian or corporation ta introduce inta any point in the Fhilippines textile articler commonly knawn ae used elothing and rage, except when thene are imported under Subsection ‘2’, ‘4’, ‘hr, “1%, ‘nn’, and ‘v’ af Section JOS of Republic Act Numbered Nineteen hundred end thirty-seven, aM HME woth" The petitioners contends that they are the lawful purchasers of the seized bales of used clothing. They allegedly formed part of the 2,207 bales of used clothing that were legitimately imported by Eloy’s Nerchandise Inc. during the effectivity of CH Circular Na. 1060, which liberalized the importation of certain non-essential consumer items including used clothing.

The respandent subsequently admitted the legality of the importation of used clothings made by Eloy’s Merchandise Inc.. In his answer, he stated that he is nat questianing the validity of the importation of used clothing made hy Eloy’s Merchandise Inc.. He | however maintains that the seized items should still he forfeited in the absence of any proof that the seized items were actually among thase that were leqally imported by Eloy’s Merchandise Inc...

Ut_:(: l. SllJrl - C.T.A.

CA S~ NU.

4e47 - 3 - The respondent fu rt.h Pr alle!=Jed that · he seized bales of llsed r:J o t . .hings allegPrll y pt1 rrh::H~e d by the pet.i tioners CCI 1ld nc•t have rnnon cr those that were lPgally i mr•orte d by El oy's tlerchanclise Inc. iu January 1 986 . lhe ciat es o:t.

th e twD transactions are allegedly far re mote col 11""1· t ll<lt it_ becomes doubtful whP t her

i. he same tm~=>d c~ J othing in w<;·re also the suhjeci..

the purch11se made by ·t. he pet.i tioner· in 1989.

I t is opined by the respondent that the used clotllings imported in 1 <::JBb rn s t ha ve alreo:tdy I.•FPn St >ld vut he:fo:rP f1Urchase of ·the peti tioners in 19H9 .

Ill :t u rt t1er ttnce oi his argumeni.s, the respnndent pointed out that th e seized bales of used clot hin!=J clo not h a v e thP ;::a me numbers and mar Jcings oi those t h at were legaLly impor ted by the Eloy's tlr:>rchandi. ::;e Inc . lher·?iore, a s c orrectly .slated by t h e r <'"'SflOndPnt, ~~~ '=' only issue to b e re.colved in the c<=tse i s whether or Jl{.l t bales of used clothing subj ct oi forfeiture were part and parcel of th e valid importation made by Eloy's tlerchandise Inc . in January 14Bb. We rule i n favor of the petitioners. The records i.n th e cane at bar is devoid of any evidence which tends t .o P.S . a olis)t that t he 20 bales of ' IS!? d clothings s ubject of fco:rfeiture were ille9ally imported nr smuggl e d by 1: 1G' pe .it.ioner into the coun ry. 848 ; ·1·r I ' ~ 1 I IN' - !_, .

• 1\ .

CA: ' !·.:

NU.

4e4.·7 - 4 - Havirq presented t.o the apprehending cust.oms officials the sales invoices issued by Eloy's Merchandise l.nc. <rp .

~-lU , BlH r ecor·d sJ .corresponding to the 20 bales oi u sed clothings, the peti t.ioneJs had :fairly es ablistu?d th e seized bales of' usP.c! clot h i nqs wE'r·e not imported purch =1sed omeP.tica lly irom an estabU s hmen t la"d l] .. l ~i "" o~J'3 q ed in usi n Pss of sellina such items . lt tiJll Prlf'Onable arod unjust to purc h aser who, aft t?r duly p.ree::ented t.he r·p ei pt s thE• i tems he bought irom arty sore or estabJ.i sh mP.JJl, to stjJl pro ve that s uch i t. ems wer•? legally j mport P d.

A buyer .in good fa i h :i.s no t.

p l oVe item he bought was .I a '~-I E ull y -"'cq u i.red Vy t .ht' B(;Ll e r , i rt<-Jsnn.Jch as the se 1 J t?r vendor "~>Tarrants to the buyer tJ tal i t ha s the right +~ o SPli the thirtq subject u1.

the sale and 1hat the same is i .r orn aroy loidu P rt .fa\l ltr~ or dejects <Ar t . .1 547 , Civil By b9i ng able to s how the recPipts cor responding to the domest.ic sa le oi t .he 20 bales of usE'd clothing, the J.tt?t i t i Ollel 3 were able to s hift the onus to the respondent ::tor her t . :J prove that the sei zed itPms were the subject o :l illegal importation . This onus, the respondent had :t ai .led to discharge.

In fact , he h ad admitted the I P(Fll i ty oi the irnport'3 in -, nf made hy ()5U l•Ft> J~:;IO IJ - r • • 'I . A.

C 1\!-3 £-:

NU .

4 B4 7

!:.loy ' s t1erchandi s e In c .

fr o m whi c l-t it had been established the seized it ~m s camP t r am. MorE>over, c!v r ing lh P on llovembE'r 21, 1989, no .lPSS than the Presiden t of El oy ' s Me rchand i se Inc . had tes tified that the bales of used clothing 'r7hich it imported on January 1986 had not been sold r1u t at the time tha t. the pe i t .i oners bought.

the s<?i zed :i. i_ ~?ms .

His explanation tha t legitimat e importers like Eloy's Merchandise lnc . found it hard to compet t~ '-7 i l.h s 111 \ l q g 1 e r s o 1.

u sed clot h in{l appears plausible crediblE' in vi ew of h is active participatio n in a nt i - !=1 rnn . n J 1 tJ 11 (..

llf:-1 i llTJ lli.ce - Chairman t11 People's I ~ CUIJOTn.lC:

Council oi Cc· l.•u RtJ <I the re - imposition o:f re s tri.c t i n n on the importation of used clothings under Central B a nk Circu] ar No . J U ~IU .

Neither th e fact that the seized bales bore different rnarl~ings or numbers will eviate :from +he foregoi n g conclusion that they iormed part o~ those t h nt we r e lPq .lly imported by Eloy's Merchandise Inc.

Since Eloy ' s in r eta i l bu s iness , it is not unli kely t.h <'lt jts buyers purchase items by I piece <•r in quantities less than those contained in any the bal E~s of u sed clothing it imported. lt is n ot also tiT d :i k e 1 y , as in t 1'"' case of the peti ioners, that buyers purchase incl i virlu n l items rom P ch imported bale {"' ( ITJl <'1 i TJ P T o:f u pr> d o I r 1 lt · ngs.

lt is ther e:fore bu·t a (55.1

PELTSION -

G.T.A. CASE NU. 4847 sound and cammon practice that retailers rebaq and repackage their merchandire ta adapt to the exigencies et itp business activities ta suit the needs of its clientele, Noreover, no law compels retailers to sell their imported merchandise in the very same state that they were imported, In the absence ef a mare contrete and direct evidence that the said merchandise was smuggled to the country “ly Petitieners, we have ra alternative “SHE 0 sustain the pasitien ef the Latter who has presented a more cancrete evidence as te dite source. We cannot sustain the pasition of the cpopondetdt which is primarily bayed anly on mere sugpiecicans and doubts.

WHEREFORE, in view of the foregoing discussion, judgement if hereby rendered ordering the respondent to release ta the petitioners the 20 baleg of used clothing eubject oc SI No. 11-85-89, SU ORDERED.

Quezon City, Metro Nanila.

ERNESTO D. ACUSTA Presiding Judge 802

DECTSION ~-

G.T.A. CASE NU. 4647

WE CONCUR:

‘ CERTIE FCATITON J hereby certify that this decision was reached after due consultation among the members of the Court df Tax Appeals in accordance with Section 13 Article VIII of the Caénestitution.

Cid Qs Cote ERNESTO bD. ACOSTA Presiding Judge Court of Tax Appeals