Rubills International, Inc. and Fil Haus Enterprises, represented byLeandro Antonio Talaue v. Customs Commissioner Napoleon L.

Morales, et al., CTA EB Case No. 471 (CTA Case No. 7782) dated July 29, 2009. Facts: On April 15, 2008, an Order was issued by the District Collector of the Port of Manila, Horacia D. Suansing, Jr., ordering the forfeiture in favor of the Government the subject importation shipments of flour by RBI/FHE. RBI/FHE filed an MR with the District Collector but was denied. Subsequently, RBI/FHE filed a Petition for Review of the decision of the District Collector of the Port of Manila. Respondents argued that the CTA had no jurisdiction over the petition. Issue: Won the CTA has jurisdiction over the petition of RBI/FHE. Held: NONE. RBI/FHE failed to appeal the forfeiture order of the District Collector of Customs to the Commissioner of Customs in accordance with Section 2313; thus, elevating the District Collectors order to the CTA was premature. Under Section 7(a)(4) of R.A. No. 1125, as amended by R.A. No. 9282 which provides the exclusive but limited jurisdiction of the CTA, it is the decision of the Customs Commissioner and not the Collector of Customs which is appealable to the CTA.
PILIPINAS SHELL PETROLEUM CORPORATION, Petitioner, vs. REPUBLIC OF THE PHILIPPINES, represented by the BUREAU OF CUSTOMS, Respondent.

Facts: Shell had tax debit memos (TDMs) and the corresponding tax credit certificates (TCCs) assigned to it. The assignment to Shell had the approval of the Board of Investments and the One Stop Shop Inter-Agency Tax Credit and Duty Drawback Center (Center). Some of these TCCs were subsequently accepted as payment by the Bureau of Customs (BoC) for petitioner's taxes and import duties in 1997 and 1998. On November 3, 1999, the Secretary of informed petitioner that its TDMs and TCCs were fraudulently issued and transferred, and had to be cancelled. He asked petitioner to immediately pay the BoC and the BIR the value of the canceled TCCs as well as the related penalties, surcharges and interests. Consequently, Shell filed a petition for review questioning the legality of the cancellation of the TCCs in the Court of Tax Appeals (CTA). On the other hand, BoC filed a complaint for collection RTC. Shell questioned the propriety of the collection suit as well as RTCs jurisdiction over the same. Issues: 1) Won filing a collection suit in the RTC is the proper remedy; 2) Won RTC has jurisdiction over the collection suit. Held: 1) YES. Section 1204 of the TCCP provides: Section 1204. Liability of Importer for Duties. Unless relieved by laws or regulations, the liability for duties, taxes, fees and other charges attaching on importation constitutes a

personal debt due from the importer to the government which can be discharged only by payment in full of all duties, taxes, fees and other charges legally accruing. It also constitutes a lien upon the articles imported which may be enforced while such articles are in the custody or subject to the control of the government. Under this provision, import duties constitute a personal debt of the importer that must be paid in full. The importers liability therefore constitutes a lien on the article which the government may choose to enforce while the imported articles are either in its custody or under its control. When respondent released petitioner's goods, its (respondents) lien over the imported goods was extinguished. Consequently, respondent could only enforce the payment of petitioner's import duties in full by filing a case for collection against petitioner. 2) YES. The governing law at that time was RA 1125 or the old CTA Law. Section 7 thereof stated: Section 7. Jurisdiction. The Court of Tax Appeals shall exercise exclusive appellate jurisdiction to review by appeal, as herein provided XXX (2) Decisions of the Commissioner of Customs in cases involving liability for customs duties, fees or other money charges; seizure, detention or release of property affected; fines and forfeitures or other penalties imposed in relation thereto; or other matters arising under Customs Law or other laws or part of law administered by the Bureau of Customs; and XXX Inasmuch as the present case did not involve a decision of the Commissioner of Customs in any of the instances enumerated in Section 7(2) of RA 1125, the CTA had no jurisdiction over the subject matter. It was the RTC that had jurisdiction under Section 19(6) of the Judiciary Reorganization Act of 1980, as amended: Section 19. Jurisdiction in Civil Cases. Regional Trial Courts shall exercise exclusive original jurisdiction: xxx (6) In all cases not within the exclusive jurisdiction of any court, tribunal, person or body exercising judicial or quasi-judicial functions, xxx. SUBIC BAY METROPOLITAN AUTHORITY, vs. MERLINO E. RODRIGUEZ and WIRA INTERNATIONAL TRADING CORP., both represented herein by HILDA M. BACANI Facts: On 29 September 2001, a cargo shipment described as "agricultural product" and valued at US$6,000 arrived at the Port of Subic, Subic Bay Freeport Zone. On the basis of its declared value, the shipment was assessed customs duties and taxes totaling P57,101 which were paid by respondent WIRA, the shipments consignee. The BOC Subic Port issued a Hold Order against the subject shipment because it was found that the shipment was actually rice. Nonetheless, the BOC Commissioner issued a directive to the BOC District Collector stating that the shipment "may be released subject to payment of duties and taxes based on an upgraded value (from agricultural product to rice x x x and compliance with all existing rules and regulations." Accordingly, Rodriguez et al. made additional payments of customs duties and taxes for the upgraded shipment. Consequently, the BOC Subic Port Cash Division issued a certification/letter stating that Rodriguez et al. have already paid the customs taxes and duties due on the shipment,

and "a Gate Pass was issued. However, BOC Subic Port District Collector subsequently issued a Warrant of Seizure and Detention dated 22 May 2002 against the subject rice shipment. Rodriguez et al. filed injunction and damages with RTC. SBMA assailed RTCs jurisdiction. Issue: Won RTC had jurisdiction Held: None. It is well settled that the Collector of Customs has exclusive jurisdiction over seizure and forfeiture proceedings, and regular courts cannot interfere with his exercise thereof or stifle or put it at naught. The Collector of Customs sitting in seizure and forfeiture proceedings has exclusive jurisdiction to hear and determine all questions touching on the seizure and forfeiture of dutiable goods. Regional trial courts are devoid of any competence to pass upon the validity or regularity of seizure and forfeiture proceedings conducted by the BOC and to enjoin or otherwise interfere with these proceedings. Regional trial courts are precluded from assuming cognizance over such matters even through petitions for certiorari, prohibition or mandamus. With the issuance of the warrant of seizure and detention, exclusive jurisdiction over the subject shipment was regained by the BOC. R.V. MARZAN FREIGHT, INC. V. COURT OF APPEALS, GR NO. 128064, MARCH 4, 2004 Facts: Petitioner RV Marzan Freight, Inc., owned and operated a customs-bonded warehouse, which, along with the goods stored therein, was covered by a Philfire insurance policy. On April 12, 1989, raw materials consigned to private respondent Shielas Manufacturing, Inc., arrived in the Philippines from Keelung, Taiwan. The Bureau of Customs treated the raw materials as subject to ordinary import taxes and were not immediately released to Shielas Manufacturing. Later, the District Collector of Customs initiated abandonment proceedings over the cargo and notice was posted. No separate notice was however sent to Shielas Manufacturing because its address was unknown. After the aforestated proceedings achieved finality but before inventory and sale at public auction, part of the warehouse containing the shipment was burned. Philfire paid to Marzan the amount of P12,000,000, for which the latter was issued a receipt. Shielas Manufacturing is now demanding payment of the value of the goods from Marzan, who, however, rejected the demand. Thus, on Dec. 26, 1991, or after the lapse of more than 2 years from the arrival of the cargo in the Philippines, Shielas Manufacturing filed a complaint for damages with the RTC of Pasig City against Marzan. The lower court ruled in favor of Shielas Manufacturing. Issue: WoN the trial court had jurisdiction to review and declare ineffective the declaration of the District Collector of Customs in the abandonment proceedings that the subject shipment was abandoned cargo and that, thenceforth, the government ipso facto became the owner thereof

Held:

The

Supreme

Court

upheld

the

contention

of

Marzan.

Irrefragably, the RTC had jurisdiction over the nature of the private respondents action, which was one for the collection of the value of the cargo gutted by fire, while under the custody and control of the petitioner preparatory to its sale at public auction by the BOC. The jurisdiction of the court or other tribunal is determined by the relevant allegations of the complaint and the character of the relief sought, irrespective of whether or not the plaintiff is entitled to recover upon all or some of the claims accorded therein. The jurisdiction of the trial court does not depend upon the defenses in the answer or in a motion to dismiss. However, the Supreme Court also held that the trial court was incompetent to pass upon and nullify (1) the seizure of the cargo in the abandonment proceedings, and (2) the declaration made by the District Collector of Customs that the cargo was abandoned and ipso facto owned by the government. It, likewise, had no jurisdiction to resolve the issue of whether or not the private respondent was the owner of the cargo before it was gutted by fire. The trial court should have rendered judgment dismissing the complaint, without prejudice to the right of the private respondent to ventilate the issue before the Commissioner of Customs and/or the CTA. The District Collector of Customs did not lose jurisdiction over the abandonment proceedings. The loss of the cargo did not extinguish his incipient jurisdiction in the said proceedings, nor render functus officio her declaration that the subject shipment had been abandoned.