CTA Case No. 3542 (Decision)

ttEP UBLIC OF T t PHILIPPINE ; )U T 0 TAX A PP~� QU�ZoN C T � F. E. ZUELLIG (M), I NC ., Petitioner , - versus - C.T.A". CASE O. 3542 THE COMMISSIONER OF CUSTOMS , Responden t. X- - - - - - - - - -X DEC I S I 0 N For violation of Section 1005 , in r elation to Section 2521, as amended , of the Ta riff and Cu stoms Code , the Co llector of Cu stoms for t he Po rt o f Manila i mposed an administr a tive fine of P30 , 000 . 00 on the vessel SS "Hong was Kong Conta ine r".. The decisionjaff irmed upon appeal by . respon den t Commiss ioner of Cus�t oms , in h is decision p r o- mu lg a ted on Septembe; 16 , 1982 . Not satisfied with t his ' dec ision , petitioner F. E. z ue llig (M) ~ Inc ., i nterposed its appea l to this Co urt . This case was s ubmi tted by the parties f o dec ision on the bas is o f the pleading and Cu stoms records . As the f ac ts 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 tione r herein is the loca s h ip a gent of the vessel s s "Hong Kong Container" wh i c h a rrived at the Port o f Mani la on August 3, 1 9~8 nde r 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~ "Pfize r Laborator y , Inc � con s igne d to the Or der of Commercia l Bank and Trust Company, Makat i, Me tro Manila , covered by Bill of Lad ing o . 803 . 2 . In the Inwa rd Foreign Manifes of the abovementioned vessel, only fourteen (1 4) pallets wer e de clared but the numbe r of ca t on was no t ind i cated . 3. Because of t he f a ilure to declare the 758 c artons contained in the 14 pallet s, an amendmen t to the Inward Foreign Manifes t was su bmi tte d by t he sh i pp i ng company and approved by the Bureau of Customs "' i t h the condition : " wi tho t p rejudice to an adm inistrat i ve action a gains t the ve s s (~l ." 4 . Du e to the i naccurate declaration of the shipmen t covered by Bi ll of Lad ing No . 803 , t he Bureau of Cu s toms sent a letter-complaint da ted Augus t 17, 1978 to the petition e r herein informing i t of i ts violation of Sec. 1005 in rel a tion to Section 2 52 ~ of the Tariff and Cus toms Code , as amended . 5. Af t e r hear ing , the Co llector of Customs imposed an a dministra ti ve f ine of P30 ,0 00 on t he vesse l SS" Hon g ~ong Container ". 6 . Petitioner herein fil ed a Motion f or Recon sideration which was denied . On appea , the Comm i ss ioner of Customs affi rmed the decision of t he Coll e ctor of Cus toms . Hence, t his petition f o r r e view . (Pp . 1 & 2, Petition , admi tted in p . 23 An swer ) �. Peti tioner herein have raised the argument tha t the decla ation in the oiig ina l manifest of the cargo as " 14 Pall e t s Pen Type Vial " is a su bstantial c ompl iance of the p r ov i sions o f Sec t i on 100 5 of the ~a ri ff and Customs Code . It a sserted t ha t to requ i re a more detailed desc ri pt i on wou ld be too strict an interpretation of the 23 7 J

DEC IS I ON - CTA CASE NO . 3542 - 3 -� law and would on y hampe r c ommerce and serves no pu rpo s e since the custom authoritie s are al ready appr ised of the sub j ect shipmen t s, as 19 palle tized " and, ~here fo re, con- taini ng a number o f carton s r eadily determina ble as to the number and dec l a r e d weigh t . It further a l l e ge d t hat s d0ect manifes was, a t a ny r ate ame nded v.rhic h is allowed under Sec ti on 1 005 , of the Tariff and Cus t oms . And th is fact did not in any way depr i ved the gover nment of t he taxes and d uti e s ue t here- one It f inally in s ists t ha t t he amendment only shows tha there exists no intent ion to misdecl are the s ub j ect shipme nt and, the r efore , it did no violate any prov is i on of l aw Re spondent , on the o t her hand , c ontends th a t peti t ioner had failed to c ompl y with the requireme~t o f l aw that e ver y vessel c om i ng from a for e i gn por t mus t have a c omple te and ac curate man i f e st of a ll i ts cargoes , and that the mani f est s hould include the quan tity as we ll as the des c ri p tion of the packages. Re s pondent fur ther c on ten ds that sub ject sh ipment should ha ve been manifes ted as c onta in ing 14 pa llets o f 758 c a rtons containing 114, 000 pes. Pe n Type Vi a ls No . 50 Type III i ns t ead of onl y "14 Pa llets Pen Type Vials " s tated i n the cargo manifes t . The s ole i s s ue befor e this c ourt is whe the r or o t the vesse SS "Hong Kong Con ta iner 10 had conveyed t he a i d 238 �'

DEC ISION - CTA CASE NO . 542 - 4- carg o withou t its proper and accurate ma nifes , i viol a tion of Sect ion 100 5, i n re l a tion to Sect i on 2521 o f the Tariff a nd Customs Cod e . We find r espondent ' s c on tention mer itor ious s The pertinent provisions of the law applicable in t his c ase is Section 1005 , t aken i n relation to Section 2521 , of the Ta riff and Customs Code, provides as fol lows : "Sec. 10 05 . Manife st Requ ir e d of Ve s se From Fore i gn Port . - Eva ry vessel fr om a for e i gn port must have on board a comple te ma nife s 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 a te manifests fo r e ach port of call t herein . Each manifest shall i nclude the por t of depar t ure and the por t of deli ve ry wi th the ma r ks , numbe rs, quantity and descript ion of the packages and t he names of the consignees thereof . Eve ry vesse from a for eign port must have on board complete manife sts o f passenge rs and their baggage , ' n the presc rib e d f o rm , s e t ting f9rth theoc destination and all pa rt icu tars required by the i mmigration l aws ; and every such vessel shall have pr epared for presentation to t he proper customs official upon arrival i n por t s of the Philippines a complete lis t of all sea stores then on board . If the vesse l doe s not carry c argo or passengers t he manifest must show that no cargo or passenge r, as the case ma y 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 e ntr y of the vessel, excep t by mean s of an amendmen t by the ma s er , consignee or agent thereof , under oath , and att ached to the o r i gina l man i fest : Provided , howev~ , That af te r t he i nvoice and/or ent r y covering an i mp~rtation have been r eceived and recorded in t he office of t he appr ai se n o amendment o f the a i est shal l 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 preparat ion of the mani f est , wi thou t any f raudulen i nt en , discove r of wh i c h c oul d no t have been made nti afte r examination of the impor ta t i on ha s been c omp e ted. And Sect i on 2 5 21, of the Tari ff and Customs Code , as amended , pr ov ide s as follows: Sec . 25 2 - Failu re to Supply Requ isite Ma nifests . I any vessel o r aircraft en te rs or departs f om a port of e ntr y wi t hout s ub- mitting the proper manifests to the cW:oms author i t ies , or sha l ente r or depa rt c on veying unman ifested ca rgo o t her than as sta t e d in t he next preceding section hereof, such vess e l o r a ircraft shall be fined an amoun not less t han ten thou s and pes os (PlO , OOO . OO ) bu t not exceeding thirty t h ous a nd (P30 , ooo . oo f pesos. The s ame fine s hall be i mpose d upon any arr1v1ng o de par ting vesse l o air c r a f t "f t he ma ster or p ilot in c ommand shal l fa i l to de l i ver or mai l to t he Commission on Aud i t a true copy of the ma nifest of the incom ing or outgoing c a rgo , as required by la � As ame nde d by P.D. No. 1258-A . ). , The issue in the c a s e at bar is not one o f f irs i mpress i on . Numer ous case s involving the same i s sue had a r e a dy been decideQ by t h is Cour t to the ef fe c t t hat every ve s se l c om ing from a f oreign port must have a comple te a nd c or rect ma n i f es t . In this ins t a nt cas e , i t is to be noted that the Inwar d Fo reign Ma nife s t o f the vessel on l y mentions a c ar go of fourt e en ( 14) _pal ets u but did no t decl a re or sta t e t he number ~f carton� s in the afor esa id fo ur te en ( 1 4 ) .Pa llets . Defin i tely , th e man e s t s ot , therefo re , considered complete a nd 240

DEC I SION - o. 3542 CTA CASE - 6 '":' " c o rrect . I had no t me t the requiremen t o f Section 25 2 the of Tariff & Cu s t oms Code to/e ff e ct tha t the s h i pmen t shou ld be marked , numbe red , a nd the qu ant ity a s we ll as the descript i on thereof should be s tatede . I only t o be spec ific , we s hall only cite one o f t he cases decided by t hi s court, and that is the case of Campania Ge ner a l de Taba cos de Fil i pin as vs. The Comrn is- sioner of Cus toms , C.T.A. Case No . 2522, Fe bru a r y 9 , 1977 , whe r e in we he l d thus - The i ssue before u s is not one of ti rs t i mpress i on . It is a rea dy we ll s e ttled t ha t wh e n a ve s sel f r om a foreign por t c a rries and discharge unmanifested ca rgoes a our por ts r it i s liable fo violati on of Sect i on 1005 an d 2521 . of t he Tariff and Customs Code. The defense of hone st mista ke , l ack o f 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 abi li t y . The law clear ly ma kes it a n i mper ative obliga tion e ver y ve ssel c orning f ~ om a foreig port to h ave on , boa rd a compl e t~ a nd cor r e c t manifest of al l i t s car go. No e xcept i on i s made in the s t atute and any attempt to read one i nto it, c ould � har d ly fa il t o def e at the purpose of i ts ~nac - . ment e (U.S. vs. S~earnship " Rub i~, 32 Ph il . 228 , 23 5-236; Smith Bel l & Co . (Ph i l . ) I nc . vs . Comm . of Customs , c . T�� Ca ses Nos . 17 28 & 921, J uly 2 , 1969 ; Macondray & o ., I nc . vs . Comrn . of Custom , C.T . A. Ca s e No . 1930 , De c . 27 , 1969 ; Compa n i a Ge ne al de Tabaco s de Filip inas vs . Comm . o f Cus t oms , C.T .A . Ca se No . 21 43 , J une 30 , 1972 ; Macondr ay & Co ., I nc e vs . Comm . of Customs , C.T.A. Cas e o . � 20 8 2, Sep � 17 , 974 ; Campani a General d e Tabacos de Fili p inas vs . Comm. of Cus toms , C.T . A. � Case No . 214 4 , J an.~ , 1 976 : ) I t i s hardl y necessary to add : The e iden t � n tent an ob jec t of these r e quirements f o r he s ubmi s sion of man ife s ts by a~~ v ess e s fr om f oreign po rts is to i mpo se ' 241

DECISION - CTA CAS E NO . 3542 - 7 -,. upon the owner s and officers of suc h 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 Cu s toms and i mmigration of fice ~s , and t o defea any attempt to make use of such vessel s to sec~re the unlawfu entry of persons o t hings into the Isl ands. 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 enactmen t . (U.S. v. Rubi, 32 Ph il. 235- 242; see also Macond:r ay & Co., Inc . s . Commiss ioner of Cu stoms r CTA Ca s o No. 1930 , Dec . 27 , 1969. ) . As � r egards the argumen of the petitioner to the e ffect t ha t wi th the amendment of the mani fe s t a llowed unde Section 1005 of t he Tari ff and Customs Code , the govern- me nt was no deprive d of its prope r taxe s a nd duties , and that the amendment wou ld only show the absence of an y inten ti on to misdeclare the su bjec�~ shipment o r to v'i o l a te a ny law is o f no significa nce . The rule is settled that under the aforesai d provision of Section 2521 of the Tari ff and 'Cus toms Code , no relie f f rom liabi l ity f o r fine i s granted even if a n amendment t o the man ife s t is a llowed . In the case of Macondray & Company, Inc ., vs . Commissione r of Customs , C.T. A. Case No . 2167, Februar y 14, 1973 , this Court held as fo l lows : \ On the matter of amendmen of t he cargo man e s v this Cou rt � n ca se of Compa nia � Gener a l de Tabacos de Filipinas vs . Commissioner of Customs, .T.A. Case No . 939 , dated February 26 , 1971, he ld : 242

DECI SION - CTA CASE NO . 542 8 Peti i oner fu r ther asserts that 11 the pr ovision of t he l aw on amendment i s de signed to protect the master , a gen o consignee fr om the e ro , mista ke or discrepancy committed by him� in t he preparation of the or i g inal manife 9t and that it is unfair and uncal l ed for to conclude , as t he responden hel in t his cas e, t ha the righ t to amend t he manifest is fo r the pr incipal purpos of ~ P otecting innoc e nt i mporters e" Whethe r the purpose of the aw i n permitting amendme nt o a vess el 's manifes t i s t o protect t he master , agent or cons ignee of the ve s se l , or the i mporte of t he goods , is to our mind of slight sign i- f icance . Unde r Se ction 25 21 of t he Tarif f a nd Cu stoms Code, no r eli e f fr om li a b i li t y fo r t he f ine i s g ran t e d whe re an amendment o f the ma ni fes t is a l l owed . (Underlin ing s upplied . ) . Taking however in to con s idera tion ~he e n tir e circums t a nc e s of the vi olation , we find that th ~ impo sed admhistrative f ine in the amount of Th irty Thousand Pe sos ( ~ 30,0 00 .0 0 ) ~ n d er t he cir c umstances , and t o our mind , harsh and exc~ss i ve . We are of the opinion and s o hold t ha t t he rea sonable administrati ve fine should only . be Te n Thous and Pesos (PlO , OOO. OO ).. WHEREFORE , t he appealed decision i s he r e by modified by r educ i ng the i mposed a dmi ni s t r at i ve fine f rom P30,000 . 00 to PlO,O OO.O O whic h pe t ition e is he reby or der ed to pay to the Bureau of Customs , Ma nila, withi t h irty ( 30) .days f r om the d a te the deci~ion becbmes f inal � � 243

JU2 -- - . ' I' DEC! ION - CTA CASE NO . 354 2 - .9 - .�.. SO ORDERED e Quezon City , October 18 , 1984 . WE CO CUR : 244