CTA Case No. 2683 (Decision)

~El'UlH.TC o.,.TllF. t�IITUPPIREI� COUR'l I ,, 1 :\ X APPE.ALI QUE~ON' CiTY SULPICIO LINES, INC., Petitioner, - versus - C.T.A. CASE NO. 2683 COMMISSIONER OF CUSTOMS, Respondent. X- - - - - - - - - - - X DE C I S I 0 N Sought to be reviewed in this appeal brought by petitioner, Sulpicio Lines, Inc., is the deci- sion of the Commissioner of Customs dated March 5, 1975, upholding the order of the Collector of Cus- toms in Administrative Case No. V-836/74 and order- ing the vessel, the M/V 11 Japan 11 , to pay a fine of 'I'wo Thousand Pesos (~2,000.00) .for violation of Section 2522 of the Tariff and Customs Code. This case had been submitt-ed based on the pleadings and records of this case. The facts are not in dispute. It appears that petitioner Sulpicio Lines, Inc. is an agent of Universal Shipping Lines, the owner and oper- ator of the M/V 11 Japan 11 , an inter-ocean cargo vessel which calls at the Ports of Japan, Taiwan, Europe and the Philippines. It further appears

DECISION - CTA CASE NO. 2683 - 2- that on February 9, 1974, the M/V 11 Japan 11 arrived in the Port of Manila from Kaoshing, Taiwan, and , among its general cargo, carried two (2) _van packs and one (1) _unit used car owned by Lindley Vives which were plucked from the M/V 11 Tagalog 11 , an ill fated vessel owned by the Maritime Company of the Philippines, which cargoes were destined for Manila. Upon arrival in Manila , the M/V 11 Japan 11 allegedly delivered, as per two delivery cargo receipts (Exhs. D 11 11 and E 11 11 Envelope of Exhibits),_ , the manifested two (2) _van packs in the same con- dition that these were loaded in Kaoshing, Taiwan , where the transhipment took place. The consignee, however, filed a complaint against the master of the vessel due to the alleged d i sappearance of household and personal effects contained in the two (2) _manifested van packs supposedly containing said personal effects. The Collector of Customs charged that there is a violation of Section 2522 of the Tariff and Customs Code for disappearance of household and personal effects and in his letter d ated July 19, 1974 required petitioner to explain why no adminis- trative fine shall be imposed . In a letter dated August 10, 1974 (Exh. B 11 11 Envelope of Exhs.) _peti- , tioner asserted that it is ver y likely that the

DEC I SION - CTA CASE NO. 2683 - 3- two (2) .van packs were already pilfered while still in the custody of the M/V " Tagalog " . On August 9 , 1974, the Collector of Customs issued an order imposing a fine of ~2,000.00 against the vessel M/V "Japan" for violation of Section 2522 of the Tariff and Customs Code. A motion for reconsideration was filed by petitioner on August 15, 1974, which motion was, however, denied i n an order issued by the Collector of Cus- toms dated September 11, 1974. On appeal, the Commissioner of Customs ren- dered a decision dated March 5, 1975 upholding the order of the Collector of Customs. Hence, this appeal. The sole issue to be resolved is whether or not petitioner is liable for the administrative fine of ~2,000.00 for violation of Section 2522 of the Tariff and Customs Code. The law involved is Section 2522 of the Tariff and Customs Code, which reads as follows: SEC. 2522. Disappearance of Mani- fested Article. - When any package or article mentioned in the manifest shall not be duly forthcoming upon the arrival of the vessel or aircraft, the vessel or aircraft shall be fined in a sum not exceeding two thousand pesos, un- less the disappearance of the package or article in question was not due to

DECISION CTA CASE NO. 2683 - 4- the negligence of the master of the vessel or pilot in command of an air- craft and explained to the satisfac- tion of the Collector. The vessel or aircraft shall be liable for the payment of the same fine when a package or article listed in the manifest does not tally mater- ially in character or otherwise with the description thereof in the manifest. The above-quoted provision of law provides that when a package or article mentioned in the manifest shall not be duly forthcoming upon the arrival of the vessel or when a package or article in the manifest does not tally materially in char- acter or otherwise with the description in the manifest, the vessel shall be fined in the sum not to exceed two thousand pesos (~2,000.00) ~ unless the disappearance of the package or article in question was not due to the negligence of the mas- ter of the vessel and explained to the satisfac- tion of the Collector. F rom the above pronouncement of law, we believe that the vessel M/V "Japan'' is not liable under said provision for the reason that as, per undertaking in the bill of lading and as mani- fested, the vessel has complied with its oblig- ation of delivering to the consignee, through the arrastre as per two cargo receipts, the two (2)

DECISION - eTA CASE NO. 2683 - 5- wooden van packs and there was no indication of any disappearance thereof per cargo receipts but only in their bad order or damaged condition. It is important to take note that what was clearly manifested and covered in the cargo mani- fest of the vessel M/V "Japan" were the two (2) wooden van packs, which cargo were salvaged from the ill-fated vessel M/V "Tagalog" which sank somewhere in Japan. And common sense dictates that the condition of said cargoes, as originally received by M/V "Tagalog" were no longer in the same as when the same were transhipped by the M/V "Japan" to their port of destination. The report of the Sheriff Surveyor (Exh. C, Envelope of Exhibits) _at the port of transhipment which was Kaoshuing, Taiwan, had emphasized and was clear on the point that the cargoes were damaged. Although the report did not mention .. that the cargoes were inventoried, the report however state that the cargoes were in a damaged condition and the same were delivered to the con- signee at the Manila port and duly receipted by the arrastre service. The contents of the two (2) _wooden crates van packs could not have been the manifested

DECISION - CTA CASE NO. 2683 - 6- cargo referred to in Section 2522 of the Tariff and Customs Code, since there was no way to verify its contents, and considering that petitioner was not the first party to the contract of carriage but the M/V " Tagalog " and, therefore, the dis- appearance of said household and personal effects could not be properly imputed to the negligence of the master of the vessel. Section 2522 of the Tariff and Customs Code is clear that a vessel shall not be fined if the disappearance of the package or article it carries, although manifested, is not due to the negligence or carelessness of the master of the vessel. WHEREFORE, the decision appealed from is qe reby reversed. Petitioner, Sulpicio Lines, Inc., is not liable for the fine imposed under Section 2522 of the Tariff and Customs Code. No costs. SO ORDERED. Quezon City, May 31, 1983. ROAQUIN Judge WE CONCUR: Presidin