CTA Case No. 4847 (Decision)

\' �' RE PU OLI C OF T HE PIH L lPP N F.~; \.OUHT OF T AX AP PF. LS !JUEZ !JN G IT Y E~ i MER ALDD L.liQ UlUER , BABY NER I, P ALHNG UROLAN, KARILYH VILI. .ANUF.VA, ELVI RA llllf.:N AV I S TA, ELPIIH O :_-; .1\HOS AL, DOY LOQUlD ER , . nttLTAZAr{ ~ .i A L LUfU DA, RE{;,r.t.t\1 U L �:GUF? A, a lid HAllY H IE S EV J U .l\ , Pet:i f: j o n >:r , GU!'1 11 1SS IUN ER OF CUSTUI'\S , C. T . A. Case No . 48 4 7 Re s pon dE> n t. j:-i; PrSEPlO''r19~ :~ - - - - - - - - - - - - - - - - - - - - - - - - - - - X \:J I C\; Ci,' '), . DECIS lUN Th .. i II B t nt 1 (" .' t n n ~ ~ - "'"'� "" f or t .he re .l t:?a s e of t 'H" n t. y <-;..o > I n l e n oj Ur-J"'d c l rtl , hi. fH)I t hot. w . re se i ze d an d r~nli.I QrJl e d i t; ms . � .I l ig a n Cit y and a ra r->n(l O'HI d in t U sjnP~S as r E' ai.l er.s o f mer c han d i Ee includ � ny u.r:: d c .l <)1 tli. u g. On Septe mb er 14, Cu s o ms Polic e of t h e s ub - p o rt o f Iligan City in t ercepted t he M/V I l igan Ci t y , a n � nt r-is l an d ve sel plyjng the Ceb 1 ~l li gan r o u te , and con�isca ted irom i ts cargo 20 b ales of used clothing fo r 84 7

111:, J~ :;l Ull - t ~ . T . A. C i\ SE l l tJ �. 4847 beinq v iolntive ~�Prti ne n t portion c�l whic~h prt�VidPs: n a.x ~c :t-' c-:>n .itH J . t'llol J h �� unl ::1wfu l for ;:my pe:r-~t�t�t, ~ - t � nr"-int-in t t t �r t'ttfflt�c<-,l.inn n introduce i otc� <Hl)' f!CIJ.llt ro t hr.:� Ph I I� p-pi or:'� t�::.x t i lE' artiC.il?i1 <'~tt11t rtt ttn 1 y ltttttwn ru-~ u���Flri t�lr�t, h t'l<.l t-~nd :rags, f?)ttH';�Jt wh~=>fl thl� r �til �ur imr� t nte rl undE>r Stt'tt se- ~ -:-: t i Ctt'l t , ' , � \t � , ~ I l /', 'n'. n nd 'v' of SectiPtl .lOD o1' !'F�tlldol It� AP ! llutnb rFM Nin e-t.Pen hurJdr~ ~ d (wd th rty-st=> Vt:� n. ){ ;�t jt tt lhe JH? t i l ion-J lJ cotdr~� ~~dt3 l. hl~ t ~� ~- �r c hasers o f the seizPd bales o:i usl? d c l othinq. They formed part. o:f the ~ , 207 bales of used clothi ng that werr-> lepitimately impo1ted by Eloy's Mercha ndise Inc . du ring "lhe effecti vi t. y of CB Circular Nn . 1060 , which libel ali ze cl Uu? impoi tat ion of certain non-Pssenti a l consumr->r items including used clothinq. 'I he x ~=>c:: pnnclent s ub Fe qu P ntJy admitted the legal' t.y of tnAde 1y El oy ' s J�1Pl e ll and i se l nc . . ln lti .EJ aJJ8WE'r , he s � ::~te d that, h e is rw t question i ng the validity o:t the impu rtation of used clothing made by Eloy's Merchandise Jnc .. He however maiJJtains that t tJe seized i terns should ti 1 1 be forfeited in the absence of any proof that the seized i ems wer~ actually among those that wer P legally imported by Eloy's Merchan dise l nc .. 848

Ut_:(: l. SllJ rl - 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 rnn on cr those that were lPgally i mr�orte d by El oy's tlerchancl ise Inc. iu January 1 986 . lhe cia t 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<;�r e also the suhjeci.. the purch11se mad e by �t. he pet. i tioner� in 1989. I t is opined by the respondent that the used clotllings impo rted in 1 <::JB b 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 t1 er ttnce oi his argumeni.s, the respnndent po inted 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 imp or ted by the Eloy's tlr:>rchandi. ::;e Inc . lh er �? iore, a s c orrectly .slated by t h e r <'"'S flOndPnt, ~~~ '=' only issue to b e re .co lved in the c<=ts e i s whether or t Jl{.l 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 . corres pond ing to the 20 bales oi u sed clothings, the peti t.ioneJs had :fairly es ablistu?d th e se ized bal es of' usP.c! clot h i nqs wE'r�e not imported purch =1se d omeP.tica lly irom an estabU s hmen t la"d l]..l ~i "" o~J'3 q ed in usi n Ps s of sellina such items . lt tiJll Prlf'Onable arod unjust to pu rc 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 we r�? leg ally 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 Eull 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 ar oy loidu P rt .fa\l ltr~ or dejects <Ar t . .1 547 , Civil By b 9i 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 se i 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 irn port'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 i t 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 Presi den t of El oy ' s Me rchand i se In c . had te s tified that the bale s 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 on ers bought. the s<?i zed :i. i_ ~?ms . His explanation tha t legitimat e importers like Eloy's Merchandise lnc . found i t 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 plau sible crediblE' in vi ew of h is active participatio n in a nt i - People's !=1 rnn . n J 1 tJ 11 (.. llf:-1 i llTJ lli.ce - Chairman t11 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 the fact that the seized bales bore different rnarl~ings or numbers will eviate :f rom +he foregoi n g conclusion that they iormed part o~ those t h nt we r e lPq .lly imp orted by Eloy's Mercha ndise Inc. Since Eloy ' s in r eta i l bu s iness , i t is not unli kely t .h <'lt jts buyers purcha se items by I piece <�r in qu antities less than those conta ined in any the bal E~s of u sed clot hing i t 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 ba le o:f {"' ( ITJl <'1 i TJ P T u pr> d o I r 1 lt � n g s . lt is ther e:fore bu�t a (55.1

,I ltF~I.ISJUH - 1;, T . A . G/\! ' E t~U. 4B4/ - (. and C:(1fOnJOn prnr. ic-1? ha :c e <'ljJ.ers reb a g a nd to i1dap to t he e x igencies of r:l\1 :i . thP n e e ds of i ts l~ l:i. en t f? l e . l1ttl"(?Ct V<:' r �, nn l11w o~mpe l s re a i l e rs to S E>ll 1: hr> i r in t h ., v fl':r y s ame s t a t e tt1at they wl='r E' �i mptr'f t 6'd. ln ~I 1ft l:t' ~ cont':r e an d d i rect thrt til"' w a~ tn1Jgg.1 e d to t. he cnuntry It Wf.? h a v tlo a l terti i:.i ve bu � t o l ~t t e r wh o ha s r ese n e el a I (I J t !1 We cannot ot 1:.. I . forpqnioq j u dpement 1 f> l ease t.<..t tlt e pt?tition <- -r '~ �. c.:ulrject o SI N rt � .ll -o�-,-f\'~. SU ORDEilED. Quez on Ci ty, Metr o Manila . ~~Q~~ E HNESTU U. A CU::iTA Pres i ding Judgr:> ,I 85~

Ul~.- : f SllJtf - B47 l : . T .A. GA~jE NU . wr:: CONC II r{: t A!/i.,.l.~elll�~ . .�.-I A , ,; � I r � .-)o:,; ll" ~I....: ~ ~~} As~~n('!iH RA l N f � 1\~. I�,� t.P .J tltt ' I I I I II c : r-: H: ~, - :t F " r c; 1\ �r ::r c 1 N 1 hero=> by c er tjJ.y t..h'3l 'J a:lo: App e 'il s in acx:nrda11���:. w.i t h ~=i~?r�t.inn 1.:3 Art icle VI I r of ~~.. ~ ERNESTO D. ACOS TA Presiding Judge Cou r t of Ta x Ap peal s 853