5.-el-greco-vs-commissioner-of-customs.docx

EL GRECO SHIP MANNING AND MANAGEMENT CORPORATION vs. COMMISSIONER OF CUSTOMS (G.R. NO. 177188, December 4, 2008)

FACTS: A Warrant of Seizure and Detention (Seizure Identification No. 06-2001) was issued by the Legaspi District Collector for the 35,000 bags of imported rice shipped by M/V Criston on the ground that it allegedly left the Port of Manila without the necessary clearance from the Philippine Coast Guard. Since Seizure Identification No. 06-2001 merely covered the cargo, but not the M/V Criston which transported it, Seizure Identification No 6-2001-A was subsequently issued particularly for the said vessel. The 35,000 bags of rice were consequently released to the consignees, Antonio Chua Jr. and Carlos Carillo, after the two have posted the P31,450,000.00 bond required by the Regional Trial Court of Tabaco, Albay. Meanwhile, as M/V Criston was under the custody of the Bureau of Customs of the Province of Albay, the vessel was allowed to temporarily transfer to another anchorage area in order to prevent any damage which could be caused by typhoon “Manang”. Nonetheless, M/V Criston failed to return to the Port of Tabaco after “Manang” had passed through the area. M/V Crimson was thereafter found in the waters of Bataan sporting the name M/V Neptune Breeze. The BOC District Collector of the Port of Manila issued a Warrant of Seizure and Detention under Seizure Identification No. 2001-208 against M/V Neptune Breeze in view of the vessel’s failure to present a clearance from its last port of call. On June 27, 2002, the Legaspi District Collector rendered a Decision in seizure Identification No. 06-2001 and Seizure Identification No. 06-2001-a ordering the forfeiture of M/V Criston (M/V Neptune Breeze), and its cargo, for violating Section 2530 (a), (f) and (k) of the Tariff and Customs Code. El Greco, filed a Motion for Intervention and Motion to Quash with the Manila District Collector asserting that M/V Neptune Breeze was a foreign registered vessel owned by Atlantic Pacific Corporation, Inc. and different from M/V Criston. The Manila District Collector ruled in favor of El Greco however such ruling by the Manila District Collector was reversed by BOC Commissioner Antonio Bernardo when the latter ruled that M/V Neptune Breeze and M/V Criston were one the same and that the Legaspi District Collector had already acquired prior jurisdiction over the vessel. El Greco sought the reversal of the aforementioned Decision and accordingly filed a Petition for Review with the CTA claiming that M/V Criston is entirely different from M/V Neptune Breeze and that the two have different and separate Certificates of Registry, and that the decision of the Manila District Collector already became final and executory in view of the BOC Commissioner’s

failure to act thereon within the 30-day period required under Section 2313 of the tariff and Customs Code. The 2nd Division of the CTA denied the Petition and held that both vessels were indeed one and the same by giving credence to the crime laboratory report submitted by the Philippine National Police which indicated that the M/V Criston and M/V Neptune Breeze have similar serial numbers in their respective engines and generators. The CTA En Banc dismissed the Petition for Review filed by El Greco for lack of merit. ISSUE: 1. Whether or not M/V Criston and M/V Neptune Breeze are the same vessel 2. Whether or not El Greco was denied of due process 3. Whether or not M/V Neptune Breeze is qualified to be the subject of forfeiture under the Tariffs and Customs Code. 4. Whether or not the decision of the Manila District Collector became final and executory. RULING: 1. Yes Supreme Court sustained the findings of the CTA En Banc and ruled that there is more than substantial evidence to establish that M/V Neptune Breeze is the very same vessel as M/V Criston. The SC took judicial notice of the fact that along with the gross tonnage, net tonnage, length and breadth of the vessel, the serial numbers of its engine and generator are the necessary information identifying the vessel. According to the SC, “(i)n as much the same way, the identity of a land motor vehicle is established by its unique motor and chassis numbers. It is, thus, highly improbable that two totally different vessels would have engines and generators bearing the very same serial numbers; and the only logical conclusion is that they must be one and the same vessel. The SC further said that the failure of the supposed operator, Glucer Shipping, to appear before the Legaspi District Collector is surprising since it is highly unfathomable for a purported owner to ignore proceedings for the seizure of its vessel since it risks the loss of a property of enormous value. While the foreign registration of M/V Neptune Breeze proves that it was registered in a foreign country; it does not render impossible the conclusions consistently reached by the Legaspi District Collector, the CTA Second Division, the CTA En Banc, and the SC that M/V Neptune Breeze was the very same vessel used in the conduct of smuggling activities in the name M/V Criston.

2. No. El Greco was not denied of due process. The technical rules of procedure and evidence are not strictly applied in administrative proceedings. The essence of due process in BOC proceedings “is simply an opportunity to be heard or, as applied to administrative proceedings, an opportunity to explain one’s side or an opportunity to seek reconsideration of the action or ruling complained of”. Although El Greco was not able to participate in the proceedings in Seizure Identification No. 06-2001 and Seizure Identification No. 06-2001-A before the Legaspi District Collector, it had ample opportunity to present its side of the controversy in Seizure Identification No. 2001-208 before the Manila District Collector. To recall, full proceedings were held before the Manila District Collector in Seizure Identification No.2001-208. Even the evidence presented by El Greco in the latter proceedings fails to persuade. The only vital evidence it presented before the Manila District Collector in Seizure Identification No. 2001-208 was the foreign registration of M/V Neptune Breeze. It was still the same piece of evidence which El Greco submitted to this Court. Even when taken into consideration and weighed against each other, the considerably sparse evidence of El Greco in Seizure Identification No. 2001-208 could not successfully refute the substantial evidence in Seizure Identifi cation No. 06-2001 and Seizure Identification No. 06-2001-A that M/V Neptune Breeze is the same as M/V Criston. Hence, El Greco cannot claim that it was denied due process since it was given ample opportunity to rebut the findings of the Legaspi District Collector.

3. Yes, M/V Neptune Breeze is qualified to be the subject of forfeiture under the Tariffs and Customs Code. Legal Basis: Sec 2530 of the Tariff and Customs Code. The penalty of forfeiture is imposed on any vessel engaged in smuggling, provided that the following conditions are present: 1.) The vessel is “used unlawfully in the importation or exportation of articles into or from” the Philippines; 2.) The articles are imported to or exported from any Philippine port or place, except a port of entry”; or 3.) If the vessel has a capacity of less than 30 tons and is “used in the importation of articles into any Philippine port or place other than a port of

the Sulu Sea, where importation in such vessel may be authorized by the Commissioner, with the approval of the department head. The fact that M/V Neptune Breeze (a.k.a. M/V Criston), was caught carrying 35,000 bags of imported rice without the necessary papers showing that they were entered lawfully through a Philippine port after the payment of appropriate taxes and duties thereon, gives rise to the presumption that the importation involved was illegal. By reason of El Greco’s failure to rebut such presumption, the 35,000 bags of rice and the concerned vessel are subject to forfeiture. 4. No , the Decision of the Manila District Collector could not have become final and executory since Section 2313 of the Tariff and Customs Code provides that “in the case the BOC Commissioner fails to decide on the automatic appeal of the Collector’s Decision within 30 days from receipt of the records thereof, the case shall again be deemed automatically appealed to the Secretary of Finance.