CTA Case No. 3529 (Decision)

j(?_ t- -;-UBLIC OF THE PHlLlPI't.\ ES l. COURr OF TAX APPEALS QU�ZON ClTY .. SEA-LAND SERVICE, INC. , C.T.A. CASE NO . 3529 , Petitioner, - versus - COMMISSIONER OF CUSTOMS, Res.ponden t. X- - - - - - - - - - - X DEC I S I 0 N An appeal from the Commissioner of Custo ms ' decision dated August 31 , 1982 affirming the Collector ' s (Port of Manila ) ~ecision in Administrative Cases Nos . V-10301/79 and V-10302/79 which imposed a fine of ~30,000.00 in each of the cas;es for violation of Section 1005 in relation to Section 2521 of the Tariff and Customs Code on unmanifested cargoes , which read in part: SEC. 1005. Manifest Required of Vessel from Foreign Port. - Every vessel from a foteign port must have on board a complete manifest of all her curgo. . .� . All of the cargo intended to be landed at a port in the Philippines must be described in separate manifests for each port of call therein . Each manifest shall include the port of departure and the port of delivery with the marks, numbers , quantity and description of the packages and names of the consignees thereof. XXX X X. X X . X: X SEC ~ 2~21. Failure to Supply Requisite Manifests. - ~ ~ any vessel or aircraft enters or departs from a ~or t of entry without submitting t~1e proper manifests to the customs au thor i ties., or shall ente:r or depart .conveying unmanifested cargo other than as stated _in the next -precedin g '45

DECISION - CTA CASE NO. 3529 - 2- section hereo f, such ves.s:e�l or aircraft shall be fined in ~ sum not less than ten thousand (JHO, 000 . 00) pe�sos but not ex:ceedin9 thirty thousand (El30,000.00) .pesos. I I X. X X XX X X. X X :I The records show that petitioner in its capacity as I operator and/or agent of tne subject ocean going vessels had on se�pa.rate occasions conveyed and discharged carg.oes in two container. vans at the Port of Manila de6l ared in the corresponding Inward Fore~ ign Manifests as "said to contain" - ( 1 ) ~sed hous e hold goods and personal effects; and (2) .16 pallets of 164 bags of polyethele�ne, e ntered on Nove�mber 3, 1978 and Oc:tobe�r 20, 1978, respectively. As verified, however, the same yielded also unmanifes ted cargoes, viz: a unit of a 1979 Mercury "Monarch" car ; and 704 bags of p o lyethelene DFP 6005 synthetic resin (an excess of 504 bags).. To effect their release from customs custody the manifests were accordingly ame nded without prejudice to the instituti9n of the appropriate administr~tive actions against ~he carriers. In the subsequent proc:eedings filed under Administrative case No. V-103Cl,l/79(S.S. Mayaquez, Registry No. 2365) .and Adminis.trative Case' No . V-10302/7~ (S.S. Mayaguez, Re- gistry No. 2266) ~ the Co llector of Customs fou nd both cases violative of Section 10 05 in relation to Section 2521 of the Tariff and Customs Code, as amended, supra, and ' I each was meted an administrative fine of El30,000.00, in '4 6

DECISION - - 3- CTA CASE NO. 3529 . a decision rendered on February 1 4 , 1 980 , which on appeal 0 by petitioner (vessels) ~ the same was affirmed by the 0 respondent Commissioner of Customs on August 31 , 1982 . Hence, the present petition. Petitioner raises the issues of 1) ~hether or not a violation of Section 1005 fn � relation to Section 2521 of the Tariff and Customs Code has bee�n committed;_ and 2) Assuming that the provisions apply to containerized ship- ments, whether or not the imposition of the enormoUs fines is proper. By and large petitioner contends that " It had abso- lutely no prior knowledge that the vans contained items not reflected in the manifest, that it had to rely on the shippe~ ' s declarations as the van was a CY-CY shipment received by the petitioner in sealed con~ition, and that i t had no fraudulent i ntent whatsoever in basing the manifest on the shipper ' s representations ." Moreover, the omissions were committed in go~d faith and amendments ., correcting the errors in the manifests were duly filed . and approve�d by the Bureau fo Customs � What we have in the case at bar are virtual Pandora's oi boxes incriminating shipments the importation of which was found in positive breach o f the governing statutory ,I proscription. Indeed , ther e c an be no further occasion to specul~t e upon how the per~ptory demand that "Every vessel from a foreign port must have on board a complete

DECISIOi'-J - CTA CASE NO. 3529 - 4- manifest of all her cargo" (Section 1005, supr a ) ~ which far from showing any mere resemb lance of an illusion, should be enforced. As, "The mandate of the law is clear and we cannot settle for less. The l aw imposes the absolute obligati on , under penalty for failure, upon every vessel from a fore:ign port to have 'o.n board complete written or type:written manifests of all her cargo signed by the maste:r' . _ Where t he l aw requires a manifest to be kept or delivered, it is not complied with unless the manifest is true and accurate. " (U.S. v. s.s . Islas Filipinas, 28 Phil . 291; cited in Macondray & Co. , In~. X"" , � v. Ac ting Commissioner of Customs , 62 SCRA 43.2) �. Upon the records before us there is nothing to take the case out of the operative effects of the cited codal provisions as understood and applied. Petitioner ' ~ proffered good faith and ~isclaimer to . any knowledge of the undeclared items in the containerized -� cargo can no longer be a prospect that can easil y be re- -r concile'd with the intended imperative. Conveyed and dis- charged were unmanifested cargoes falling sharply at odds with the caveat essentially addressed and directly brou~ht ' to bear upon the carriers, requiring a manifest of a true and accurate description of all the cargo. And , " Doing business in the Philippines, it behooves the master or owner of the vessel to abide by our customs laws and 48

DECISION - - 5- CTA CASE NO. 3529 . regulations and to ignore them is nothing short of care- lessness and incompetence. " (Delgado Shipping Agencies, Inc. v. Commissioner of Customs, G. R. L-46262, July 6, 1977) ~ In a ruling of similar import t his Court said "We can do no less but hold the herein petitioner accountable for such deviation from the' peremptory de'mands of the l aw , the proflered good faith as an encapsulating panacea i n bashing the delinquency n~twithstanding . This specie of - irregularity was not propitious then, it cannot, now. " ( Delgado Shipping Agency , Inc . v. Commissioner of Customs , CTA Case No. 3089 , December 28 , 1 981) ~ Pet i tioner must c ome to grip with t he facts obtaining , nothing more . Having taken the responsibility petitioner must assume full accountability for the underta king i n fealty to the governing law and regulations. The Customs law could not have wished the respondent to ': merely . rubber-s:tamp an imprimatur of acquiescence over a " said �� to contain" declaration . And we do not think that by the simple expediency of containerization the law can be flouted with impunity and its efficacy defused i n a cul de ~ac of impotency . The chips must somehow fall and � having fallen the erring vessels must bear the statutory penalty so orda ined in Section 2521 of the Tariff and Customs Code, supra, which directs t he i mposition o f a fine i n the sum of ~10,000.00 bu t no t more than P30,000o00. / )

: DECISION - - 6- CTA CASE NO . 3529 .. The statute makes no distinction nor does it establish an exception as regards the vess e l ' ~ failure to supp ly the requisite manifest. Subsequent amendment adds no :hsulating relief for "even granting arguendo, that the amendment was approved and therefore valid it does not in any way relieve the vessel from the liability which she already incurred prior to the amendment." (Macondray Sc Co., Inc. v. Actg. Commissioner of Customs , 62 SCRA 434) �. Relative to petitioner's. nibble on the reduction of the "enormous" fi nes suffice it to state that the amount imposed is not without authority nor l og ic as thus ruled in an analogous case, "The clear purpose of t~e codal provision requiring vessels to decla.re the correct weight of their cargo is to curb smuggling due to such under- declaration. Hence, imposing the maximum fine on vessels which fail to comply with the obligation to declare the . . true weight of their cargo promotes the spirit and pu r pose of the law since imposing a minimum fine would embolden would be smugglers. " (Commissioner of Customs , v. CTA, et al., 91 SCRA 262) �. The administrative fines i.mposed in the instant case are in accordance with the cited codal provision and having shown no abuse of discretion on the p e rt of the Customs' officials , we leave the same to r emain . so .. )

... . DECISION - - 7- CTA CASE NO. 3529 Ia . IN VIEW OF ALL THE FOREGOING, the decision appealed f rom is hereby aff irmed with costs against the petitioner. SO ORDERED. QQezon Ci ty, Metro Manila, February 29 , 1984. z.~ Associate Judge � WE CONCUR: r...... � ROAQUIN Associate J udge ... 51