CTA Case No. 3831 (Decision)

Il IICPUOU C OP �ft11 I'Hll.JtPIOI U COUftT OF TA.X APPEALS Q UEZON Cln' ~K.M.K. GANI AN D INDRAPAL C.T.A. CASE NO. 3B3l & COMPANY, Petitioners, - ve r sus - THE Cot~ IHSSIONER OF CUSTOMS, Respondent. X- - - - - - - - - - - - - X D E C I S l C1 N This is an appeal fro m the Commissioner of Cu stoms' decision of January, l9B4, affirming the Collector's of the Manila International Airport (MIA) f o rfeiting i n favor of the Gover nment all the cargoes in two (2) containers allegedly destined for Singapore as violative of the Dangerous Drug Act a n d Central Bank Circular No. BOB in relation to Section 2530(f), (i) and (l) - 3, 4 & 5 of t he Tariff and Cust om s Code. Records show that two (2) containers loaded with 103 cartons of merchandise covered by eleven (ll) airway bills of several Singapore-based consignees incl uding herein petitioners arrived at the Manila Inter national Airport on board Flight PR 311 from Hongkong on September 11, l9B2 . Up on arrival, the c ontainerswere off-loaded from the carrier by elements of Lhe Suspected Cargo and Anti-Narcotics (SCAN) group of the Bureau of Cust om s and were transferred to the 1

DECISION - CTA CASE NO. 3831 2 International Cargo Terminal under Warrant of Seizure a nd Detention and thereafter subjected t o Seizure and Forfeiture proceedings for alleged "t echni ca l s muggling " . After due h earing, all t he clai man t-consignees moved for the t rans- s hipment of the ir respective cargoes to the actual desti- .nation in Singapore. The Collector of Cus t oms (M IA ) ordered and decreed the forfeiture of all the cargoes in the said containers. ( Seizure Id entif ic ~ ti o n No. 499 3- 82 dated J uly 14, 1983) . Upon appeal by all the claimant-consignees, the Commi ssi on e r of Customs affirmed the Co llector 's decision. (Customs Case No. 83-85, Janu a r y , 198 4 ). Taking exception, the here in two peti ti oners moved f or t he r ec onsider a t i on in so far as concer n the ir shipments, but likew ise dismissed by the re spondent Commi ssi oner of Customs in a Resolutio n dated Jul y , 1984. Hen c e , this petition for rev i e w. Petitioners hold themselves entitled to the release of their carg oes for transshipment t o Singapore so ma nifes te d and c ove red by Airway bills as in tra nsit , t o wit: Three (3) cartons "Audio-visu al Part s (D.C. operated)" consigned to "Mr . K. M.K. Gan i " 99 Greenfi el d Drive, Singapore 1564 , Rep. of Singapore, sent by "M. Lachmand as" Far East Mansi on, Kowl oon , Hongkong (P AL Airway Bill No. 0 79 - 0358-9342); And , Seven ( 7) cartons "Movements, Watches, Writing Instru- ments and Optic.al Goods" co nsigned to "Indrapal & Company"

DECISION - CTA CASE NO . 3831 3 97 High Street, Singapore 0614, Rep . of Singapore , sent by "Khemsons Corporation" , Imperial Building, 58 Canto n Road, Kowloon, Hongkong (PAL Airway bill No. 079-0366-6821 ), contendin g that the good s were never intended imp ort ati ons int o the Philippines and th e same suffer none of a ny affi - liating breaches allegedly found attributable to the others shipments under the Custo ms and related laws. Res pondent lays stress on 8 derogatory inf ormation f urni shed by an informant of apparent impeccable credentials t hat the carg oes in the containers were actual importations in the country made plausible under a scenario that t he ro ute via Manila is "more expensive, tedious and ci r c uituous" vis-a-vis a direct flight fr om Hongkong to Singapore; uneasy antjcipation of the PAL's service van alongside the carrier "apparently to unload" the cargoes ; several of the cartons yielded upon examination packages of "mogadon" and " madrax" drugs~ authorization ; TV se ts, betamax, car ste reos and the like of American standard "unadaptable" for Sing apor e use and such other random specie of "mis- de c la ration". As thus, "Taken altogether, the above- ci rcumstances lead to only one conclusion - that the articles in question were intended for the Philippines and not Singapore. They constitute a moral certainty of intent to unload in this country in violation of our Tariff and Customs laws for which the articles have incurred the liability of forfeiture. " 1 ..~

DECISION - CTA CAS E NO . 3831 4 Al l t old , there are a total of 103 car tons of various mercha~dise in the two ( 2) containers deemed i mpor tati ons wit hin the meaning o f Section 1202 of the Tariff and Cus t oms Code seized and fo rfei te d as violative o f the Customs l aws. As so c irc umstanced , ho we ver , t he c argo manifests of t he carry i ng aircraft sh ow that the shipments were in t r a nsit destined for Singap ore . Th e c orr es ponding airway bills were of the same j mp ~ rt. It does not appear that th e respo nd ent disp utes this simple material fact . But, dr ummed by a confidential i n f o r ma tion evokin g a sense o f a deja vu that the cargoes were int ende d to be i mporte d into t h e Philippines ; the Customs SC AN team summarily seized the same from the carrying aircraft upo n arrival. Upon examination a couple of t h e cartons contained articl es which as earlier aver red, we re either unauthorized or mi sdec l ared hence forfeitable un de r Section 2530(f) of the Tariff and Customs Code. On this basis all the 10 3 ca rtons of merchandise were co mpressed into a sin gle shi pmen t deemed i mporte d contrary to la w encapsulated in a dec ree of f orfe it ure. The conclusi on is a little off, we do no t reach the same . Th e record rai se s the basic issue o f whether the petitioners' shipments may be de em ed importations c on - t emplated i n Section 1 202 of t he Tariff a n d Customs Code, providing, i nsofar as pertinent , that -

DECISION - CTA CASE NO . 3831 5 "Importation begins when the carrying vessel or aircraft enters the j urisdictio n of th~ Phili ppines with the intention to unlade therei n. xxx is deemed terminated upon payment of duties, taxes and other charges due upon the articles, or secured to be paid, at the port of entry and the legal permit f or withdrawal shal l have been granted; xxx." The case before Us i s essentially addressed and brought t o bear upon the 10 cartons of articles consigned to the herein non-resident fore i gn based petitioners . As thus shown the ba si s of the claim is not shor t of specific support in terms of tractable data openly laid and fully disclosed. Upon the records, the circumstances obtaining are by no means clear as to any overt act show in g any "intention to unlade" -� j ust as they are n ot clear as to a ny attempt to have the car goes "ente red" into the Philippines. This could be a compelling indicia amply sufficient to dispe l any pall of uncertainty cast over th~ transient status of the cargoes and the locus of the undertaking as well. Validly infused cognizance as thus, it comes an aggravate d chutzpah to have the particular ship ments subjected to a f urther speculative dithering yet loose to run the gauntlet of a most demanding wringer of verification. And considering that the examination was neit her ne cessary nor required, the exercise of such authority could have been stretched too far the effective range of expedi~ncy. Be that as i t may, the examination revealed no Pandora's box of i ncr iminating evidence , so 14v -I - - -

DECISION - CTA CASE NO. 3831 6 to speak . The questioned cargoes were of the pretty i nnocuous stu ff so stated in the covering airway bills . Respondent points to no factual findings of delinquency nor irregularity of relevance and competence to bash that patina of legitima cy over the petitioners' under- taking . Absent the "intent to unload" much less "attempt to enter", we find no threat of ambiguity in the language of Secti on 1202, supra, as wouJd ha ve the shipments con- si dere d importations in t he country. We see no reason and none is vouchsafed why a simple case where fa ct and fabrication are no l onge r indistinguishable should remain f oreclosed. By the above light we view with ease petitioners' righteous indignation in prying the cargoes loose from the indiscr;minately assumed and arbitrarily imposed sanction of forfeiture. Petiti one rs have proved entitle- ment to a favorable determination as a matter of fact and law . WHEREFORE, the s ubject ten (10) cartons of articles are hereby released to the carrying airline for immediate transshipment to the country of destination under the ter ms of the contract of carriage. No costs. SO ORDERED.

DECISION - CTA CASE NO. 3831 7 Quezon City , Metro Manila, August 30, 1985. WE CON CUR : I