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ANGELES CITY v ANGELES ELECTRIC

CORPORATION

Facts:

On January 22, 2004, the City Treasurer issued aNotice of Assessment to Angeles Electric

Corporation (AEC) for payment of businesstax,license fee and other charges for the period 1993

to 2004 in the total amount of P 94,861,194.10.

Within the period prescribed by law, AEC protested

the assessment. When the City Treasurer denied the

protest and ordered petitioner to settle its obligation,

petitioner filed with the RTC a petition praying forthe issuance of a TRO which was granted.

The city government opposed on the ground that per

NIRC the collection of taxes cannot be enjoined.

Issue:

Can an injunction be issued to enjoin the collection of

local taxes?

Held:

YES. The Local Government Code does notspecifically prohibit an injunction enjoining the

collection of taxes. This is different in the case of

national taxes where the Tax Code expressly provides

that no court shall have the authority to grant an

injunction to restrain the collection on national

internal revenue tax, fee or charge with the sole

exception of when the CTA finds that the collection

thereof may jeopardize the interest of the governmentand/or the taxpayer. Nevertheless, there must still be

proof of the existence of the requirements for

injunction to be issued under the Rules of Court (i.e.,clear right to be protected and urgent necessity to

prevent serious damage).

YAMANE v BA LEPANTO CONDOMINIUM

CORP.

Facts:

Petitioner City Treasurer of Makati holds respondent,

in a Notice of Assessment, liable to pay the

correct business taxes, fees and charges totaling to

P1.6M in which the respondents protested contending

that condominium does not fall under the definition

of a business, thus, they are not liable for such taxes.

Issue:Whether or not the City Treasurer of Makati may

collectbusiness taxes on condominium corporations

Held:

Petition denied. Accordingly, and with significant

degree of comfort, we hold that condominium

corporations are generally exempt from

local business taxation under the LGC, irrespective of

any local ordinance that seeks to declare otherwise.

The power of the local government units to impose

taxes within its territorial jurisdiction derivesfrom the Constitution itself, which recognizes the

power of these units to create its own sources ofrevenue and to levy taxes, fees, and charges subject

to such guidelines and limitations as the Congress

may provide, consistent with the basic policy of local

autonomy.

JARDINE DAVIE INSURANCE v ALIPOSA

GRN 118900 February 27, 2003

Facts:

Makati enacted Municipal Ordinance 92-072 which

provides for the schedule of real estate, business and

franchise taxes in Makati. PRCI appealed the

ordinance with the DOJ assailing invalidity due to

lack of public hearing, in violation of RA 7160. DOJdeclared it null and void while pending appeal to

SC, Makati continued to implement the ordinance.Petitioner Jardine paid its deficiency taxes without

any protest. In 1995, Jardine requested for tax credit

or refund which Makati denied reasoning that until

nullified by final judgment of competent court, the

ordinance remained in full force & effect. RTC

dismissed petitioners case ruling that plaintiffs

cause of action has prescribed. Petition for review

under Rule 45 was filed.

Issue:

Whether or not a protest must first be filed before anaction for refund/credit in instituted.

Held:

As a general precept, a taxpayer may file a complaint

assailing the validity of the ordinance and praying fora refund of its overpayments without first filing a

protest to the payment of taxes due the ordinance.

However, petitioner was prescribed from filing its

complaint with RTC for the reason that petitioner

failed to appeal to Sec. of the Justice within 30 days

from affectivity of ordinance as provided by Sec 187,

RA 7160.

Failure of taxpayer to interpose the requisite appealto DOJ is fatal to its complaint for a refund. Any

delay in implementing tax measures would be to thedetriment of the public. It is for this reason that

protests over tax ordinances are required to be done

within certain time frames. Moreover, petitioner even

paid without any protest the amounts of taxes

assessed by respondents as provided for in the

ordinance. The complaint was a mere afterthought.


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SAN JUAN vs. CASTRO

Facts:

Romulo D. San Juan, registered owner of real

properties in Marikina City conveyed, by Deed ofAssignment, the properties to the Saints and Angels

Realty Corporation (SARC), then under the processof incorporation, in exchange for 258,434 shares of

stock therein with a total par value of P2,584,340.

Mr. San Juan then paid the transfer tax based on the

consideration stated in the Deed of Assignment.

Marikina City Treasurer Ricardo L. Castro informed

him, however, that the tax due is based on the fairmarket value of the property. In turn, Mr. San Juan in

writing protested the basis of the tax due but on July

15, 2005, via a letter, Mr. Castro responded on the

negative.

Mr. San Juan thus filed before RTC a Petition for

mandamus and damages against Mr. Castro in his

capacity as Marikina City Treasurer praying that the

latter be compelled to perform a ministerial duty,that is, to accept the payment of transfer tax based on

the actual consideration of the transfer/assignment.Mr. San Juan claims that the intention of the law in

Sec. 135 of the LGC is not to automatically apply the

whichever is higher rule. Clearly, from reading the

provision, it is only when there is a monetary

consideration involved and the monetary

consideration is not substantial that the tax rate is

based on the higher fair market value. But the RTC

dismissed the case holding that [M]onetaryconsideration as used in Section 135 of R.A. 7160

does not only pertain to the price or money involved

but likewise, as in the case of donations or barters,this refers to the value or monetary equivalent of

what is received by the transferor. And in this case

the fair market value of the stocks which is P7M is

higher than the consideration which is only P2.58M,

hence, the former amount must be used as tax base.Moreover, The subject of this Petition is the

performance of a duty which is not ministerial in

character. Assessment of tax liabilities or

obligations and the corresponding duty to collect the

same involves a degree of discretion. It is erroneous

to assume that the City Treasurer is powerless to

ascertain if the payment of the tax obligation is

proper or correct. Mandamus cannot lie to compelthe City Treasurer to accept as full compliance a tax

payment which in his reasoning and assessment isdeficient and incorrect.

Issue:

Did the RTC err in dismissing the petition for

mandamus?

Held:

NO. For a petition for Mandamus to lie, there must

be no other plain, speedy and adequate remedy in the

ordinary course of law. In this case, the said

condition was not satisfied. A taxpayer who disagreeswith a tax assessment made by a local treasurer may

file a written protest as prescribed by Sec. 195 of theLGC: The taxpayer shall have thirty (30) days from

the receipt of the denial of the protest or from the

lapse of the sixty-day (60) period prescribed herein

within which to appeal with the court of competent

jurisdiction, otherwise the assessment becomes

conclusive and unappealable.

That Mr. San Juan protested in writing against the

assessment of tax due and the basis thereof is on

record as in fact it was on that account that Mr.

Castro sent him the July 15, 2005 letter which

operated as a denial of Mr. San Juans written protest.

Mr. San Juan should thus have, in accordance with

Sec. 195 of the LGC, either appealed the assessment

before the court of competent jurisdiction or paid thetax and then sought a refund. He did not observe any

of these remedies available to him, however. Heinstead opted to file a petition for mandamus to

compel Mr. Castro to accept payment of transfer tax

as computed by him.

Mandamus lies only to compel an officer to perform

a ministerial duty (one which is so clear and specific

as to leave no room for the exercise of discretion in

its performance) but not a discretionary function (one

which by its nature requires the exercise ofjudgment). Mr. Castros argument that [m]andamus

cannot lie to compel the City Treasurer to accept as

full compliance a tax payment which in his reasoningand assessment is deficient and incorrect is thus

persuasive.

TEAM PACIFIC CORPORATION v DAZA, in

her capacity as Municipal Treasurer of Taguig

Second Division, G.R. No. 167732, July 11, 2012

Facts:

Petitioner Team Pacific Corporation (TPC), a

domestic corporation engaged in the business of

assembling and exporting semiconductor devices,

conducts its business at the FTI Complex in Taguig.

Since the start of its operations, TPC had been payinglocal business taxes (LBT) at 1/2 ofthe rates imposed

on exporters and on manufacturers, millers,producers, wholesalers, distributors, dealers or

retailers of essential commodities pursuantto

the Taguig Revenue Code. When TPC renewed its

business license in 2004, however, Respondent

Josephine Daza,then Municipal Treasurer of Taguig,

assessed LBT atthe full rate on the ground that TPC

is not an exporter of essential commodities. TPC paid


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the assessed LBT and filed a written protest on

January 19, 2004. On April 15, 2004, TPC filed a

petition for certiorari under Rule 65 ofthe 1997 Rules

of Civil Procedure before the Regional Trial

Court(RTC). TPC alleged that Daza did not act on itsprotest within 60 days, as prescribed under Article

195 ofthe Local Government Code (LGC), and thatDaza acted with grave abuse of discretion in not

applying the 1/2 rate provided under the Taguig

Revenue Code. Daza argued that TPC erred in filing

a petition for certiorari and that TPC should have,

instead, filed an appeal in court within 30 days from

receipt ofthe denial. The RTC dismissed the petition.Itfound thatthere was no proof of denial of TPCs

protest. Hence, TPC had 30 days from the lapse ofthe

60 days allowed for the treasurer to make its

decision, within which to perfect an ordinary appeal.

The RTC ruled thatthe special civil action of

certiorari is notthe proper remedy of TPC. TPC

appealed to the Supreme Court and argued thatthe

remedy of appeal is not specified under Article 195ofthe LGC, and therefore, a Rule 65 petition for

certiorari is the proper and logical remedy, given thatDaza acted with grave abuse of discretion in

assessing its LBT atthe full rate. After receiving a

notice of assessment, a taxpayer may file within 60

days a written protest with the localtreasurer, which

shall decide on it within 60 days. The taxpayer can

make an appealto

the Regional Time Court(RTC) within 30 days from

receiving the denial ofthe protest, or from the lapse ofthe 60-day period to

decide on the protest. Thereafter,the taxpayer can

appeal the decision ofthe RTC to the Court of TaxAppeals (CTA) within 30 days after receiving the

decision.

Issue:

Did TPC avail ofthe correct remedy againsttheassessment when it filed a petition for certiorari

before the RTC?

Held:

No. TPC did not avail ofthe correct remedy. TPC

should have filed an ordinary appeal with the RTC.

Within 60 days from receipt of a notice of

assessment, a taxpayer may file a written protest withthe localtreasurer, which shall decide the same within

60 days. The taxpayer shall have 30 days fromreceipt ofthe denial ofthe protest, or from the lapse

ofthe 60-day period given to the localtreasurer to

decide the protest, within which to appealto the RTC.

Without any formal denial ofthe protest, TPCs filing

ofits petition before the RTC on April 19, 2004 was

done in a timely manner. Reckoned from the filing

ofthe protest on January 19, 2004, Daza had 60 days

or until March 19, 2004 within which to resolve the

protest. From the lapse ofthis 60-day period, TPC had

30 days or until April 18, 2004 within which to file

its appealto the RTC. Since the latter date fell on a

Sunday,the RTC correctly ruled that TPCs filingofits petition on April 19, 2004 was still within the

prescribed period. However, a Rule 65 petition forcertiorari is notthe appropriate remedy from Dazas

inaction on TPCs protest. Instead, TPC should have

filed an ordinary appeal with the RTC. Thereafter, an

appealfrom the judgment, resolution or order ofthe

RTC

shall be made within 30 days after receipt ofthedecision, by filing a petition for review with the

CTA. The perfection of an appeal in the manner and

within the period fixed by law is not only mandatory

butjurisdictional, and non-compliance with these

legal requirements is fatalto a partys cause.

JAO v CA

October 6, 1995

Facts:The Bureau of Customs received information

regarding the presence of allegedly untaxed vehicles

and parts in the premisesowned by a certain Pat Hao

in Paraaque and Makati. After conducting

surveillance, a recommendation of the issuance

of warrants of seizureand detention articles was

made.

On the strength of the amended warrants; customspersonnel started hauling the articles and this

prompted petitioners to file a case ofinjunction before

the Makati RTC, which issued the TRO.Upon review, CA set aside orders of the trial court

and dismissed thecivil case. Hence, this petition.

Issue:Whether or not the trial court has jurisdiction over the

case.

Held:

There is no question that RTCs are devoid of any

competence to pass upon the validity/regularity

of seizure and forfeiture proceedings conducted bythe Bureau of customs and to enjoin an otherwise

interfere with these proceedings.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. The

regional trial courts are precluded from assuming

cognizance over such matters even through

petitioners for certiorari, prohibition and mandamus.


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SUBIC BAY METROPOLITAN AUTHORITY

(SBMA) v RODRIGUEZ

Facts:

On September 29, 2001, a shipment described asagricultural product arrived at Subic Bay Freeport

Zone. On October 23, the BOC issued aMemorandum stating that upon examination the

shipment was found to contain rice. The

representative of the importer then stated that there

was a misshipment and manifested willingness to

pay appropriate duties and taxes. The BOC then

issued a Hold Order on October 25, 2001. Despiteseveral certifications for its clearance, Petitioner

SBMA refused to allow the release of the rice

shipment. Hence, on June 11, 2002, the respondent-

importers filed with the RTC of Olongapo City a

complaint for Injunction and Damages against

SBMA.

Issue:

Did the RTC have jurisdiction over the case?

Held:

NO. The Collector of Customs has exclusive

jurisdiction over seizure and forfeiture proceedings

and the regular courts can not interfere nor can it

enjoin these proceedings. This is the rule the moment

the imported goods are in the possession or control of

the Customs authorities even if no warrant for seizure

or detention had previously been issued. The actionsof the BOC are then only appealed to the CTA. The

Court also said that this rule, which is anchored upon

the policy of placing no unnecessary hindrance on thegovernments drive to prevent smuggling and fraud

and to collect correct duties, is absolute.

ENRILE v VINUYA

FERNANDO; January 30, 1971

Nature:

Certiorari and prohibition proceeding

Facts:

The then Collector of Customs of the Port of Manila

issued a warrant of seizure and detention against the

Cadillac car involved in this case, the owner-claimantbeing a certain Rodolfo Ceniza, as the taxes and

duties had not been paid.It was moreover shown in the petition that the owner,

Rodolfo Ceniza, had sold such car to one Francisco

Dee from whom respondent Vinuya acquired the

same.

Vinuya filed a complaint for replevin in the sala of

respondent Judge on the ground of alleged illegality

of the seizure which, in the opinion of respondents,

did not confer jurisdiction on the Collector of

Customs.

Petitioners filed a motion to dismiss on the ground

that forfeiture proceedings had already been

instituted before the Collector of Customs who hasthe sole jurisdiction to determine questions affecting

the disposition of property under seizure as well asthe absence of a cause of action. This was denied for

lack of merit. Thus this petition.

Issue:

WON the court of first instance is vested with

jurisdiction to entertain a complaint for replevin forthe recovery of a Cadillac car, subject of a seizure

and forfeiture proceeding in the Bureau of Customs

Held:

NO. The prevailing doctrine is that the exclusive

jurisdiction in seizure and forfeiture cases vested in

the Collector of Customs precludes a court of first

instance from assuming cognizance over such amatter. This has been so, as noted, since Pacis v.

Averia.

Ratio:

a. The existence of the power and the regularity of

the proceeding taken under it are distinct from each

other. The governmental agency concerned, the

Bureau of Customs, is vested with exclusive

authority. Even if it be assumed that in the exercise of

such exclusive competence a taint of illegality maybe correctly imputed, the most that can be said is that

under certain circumstances the grave abuse of

discretion conferred may oust it of such jurisdiction.It does not mean however that correspondingly a

court of first instance is vested with competence

when clearly in the light of the above decisions the

law has not seen fit to do so.

b. "the Court of First Instance should yield to thejurisdiction of the Collector of Customs. The

jurisdiction of the Collector of Customs is provided

for in Republic Act 1937which took effect on July 1,

1957, much later than the Judiciary Act of 1948. It is

axiomatic that a later law prevails over a prior statute.

c. Moreover, on grounds of public policy, it is more

reasonable to conclude that the legislators intended to

divest the Court of First Instance of the prerogative toreplevin a property which is a subject of a seizure and

forfeiture proceedings for violation of the Tariff andCustoms Code. Otherwise, actions for forfeiture of

property for violation of Customs laws could easily

be undermined by the simple devise of replevin."

d. Section 2303 of the Tariff and Customs Code

requires the Collector of Customs to give to the

owner of the property sought to be forfeited written

notice of the seizure and to give him the opportunity


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to be heard in his defense. This provision clearly

indicates the intention of the law to confine in the

Bureau of Customs the determination of all questions

affecting the disposal of property proceeded against

in a seizure and forfeiture case. The judicial recourseof the property owner is not in the Court of First

Instance but in the Court of Tax Appeals, and onlyafter exhausting administrative remedies in the

Bureau of Customs."

The writ of certiorari prayed for is granted,

respondent Judge being clearly without jurisdiction

VIERNEZA v COMMISSIONER OF CUSTOMS

RIGOR v ROSALES

Facts:

Collector Sabino Rigor issued a Warrant of Seizure

and Detention against the vessel LCT-759 and its

cargo, consisting of 103 pieces of logs for failure to

present a manifest for the said logs within the periodprescribed. The parties who were duly notified and

represented, voluntarily submitted to the jurisdictionof the respondent Collector. After hearing, the

Collector rendered a decision ordering the seized logs

forfeited in favor of the government to be disposed of

according to law.

Instead of appealing the Collectors decision to the

Commissioner of Customs, the private respondents

filed an original petition for certiorari with the Davao

CFI. Respondent alleged lack of jurisdiction of theCFI.

Issue:W/N the lower court has jurisdiction to review a

decision of the Collector of Customs

Held:

The Supreme Court held in the negative.Articles subject to seizure do not have to be goods

imported from a foreign country. The provisions of

the Code refer to unmanifested articles found on

vessels or aircraft engaged in the coastwise trade. The

customs authorities do not have to prove to the

satisfaction of a court of first instance that the articles

on board a vessel were imported from abroad or are

intended to be shipped abroad before they mayexercise the power to effect customs searches,

seizure, or arrests provided by law and to continuewith the administrative hearings on whether or not

the law may have been violated.

Regarding the nature of the port of origin and the port

of destination, it is enough if one of the ports is a port

of entry. The respondent courts finding that port of

entry must be limited to the wharves of Sta. Ana

and Sasa where thecustoms house is located and not

extended to every inch of the City of Davao would

unduly hamper if not cripple the effective

enforcement of customs and tariff laws. Customs

officials cannot stand by helplessly for want of

jurisdiction simply because a restrictive interpretationof port of entry would enable coastwise vessels to

load or unload unmanifested goods with impunityoutside of the specific area where the wharves and

the customs house are located.

Furthermore, the Supreme Court ruled that the

customs officials have authority under the law to

make the initial determination on the limits of

their administrative jurisdiction, to act speedily andto make decisions on the basis of that determination,

and to have such act or decision reviewable only in

the manner provided by the Customs and Tariff

Code. The Collectors decisions are appealable to the

Commissioner of Customs, whose decisions, in cases

involving seizure, detention or release of property,

may in turn be reviewed only by the CTA.

PAPA v MAGO

R.V Marzan Freight vs. CA/ Shielas

Manufacturing

GRN 128064

Facts:

Philfire issued insurance policy to R.V Marzan,

owner of a customs bonded warehouse. Shielas

manufacturing engaged in the garment business, theconsignee of raw materials from Taiwan. The BOC

treated the materials as subject to ordinary import

taxes and were not immediate released to respondent.The consignee failed to file the requisite import entry

and to claim the cargo.BOC authorized petitioners for

stripping and safekeeping after 5 months, notice of

abandonment giving respondents 15 days from notice

to file entry the file cargoes without prejudice to rightof the consignee to redeem articles cargoes would

redeemed abandoned and be sold at public auction.

After a month the declaration of abandonment has

become final and executory but before inventory and

sale public auction of goods the warehouse was

burned. Philfire paid 12,000.00 for the warehouse.

After the Lapse of more than 2 years from the arrival

of the cargo, the private respondent filed a complaintfor damaged before RTC. Petitioner arrived that there

is no private of Contract between them since thecargo was received from BOC and that respondent

failed to claim the cargo, pay taxes thus not entitled

to insurance proceeds.

Issue:

Whether or not the trial court had jurisdiction to

review and declare ineffective the declaration of the


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BOC in abandonment proceedings and that the

government ipso facto became the owner thereof.

Held:

The declaration that the cargo was abandoned for thefailure to file the import entry was ineffective

because notice of proceedings of abandonment wasnot given to the consignee. Evidently, the resolution

of this issue is within the exclusive competence of the

District Collector of Customs, the Commissioner of

Customs and within the appellate jurisdiction of

CTA.

The rule has RTC has no review powers over suchproceedings is anchored upon the policy of placing

un necessary hindrance on the government drive not

only to prevent smuggling and other frauds upon

customs, but more importantly, to render effective

and efficient the collection of import and export

duties due the State, which enables the government to

carry out the functions it has been instituted to the

perform. The trial court should have dismissed thecomplaint without prejudice to the right of the private

respondent to ventilate the issue before theCommissioner of the Customs and/or CTA.

CHEVRON PHILIPPINES v COMMISSIONER

OF CUSTOMS

COMMISSIONER OF CUSTOMS v MANILA

STAR FERRY, INC.

Doctrine:

Section 2530(a) of the Tariff and Customs

Code in unmistakable terms provides that a vesselengaged in smuggling "in a port of entry" cannot be

forfeited. This is the clear and plain meaning of the

law. It is not within the province of the Court to

inquire into the wisdom of the law, for indeed, we are

bound by the words of the statute.Forfeiture proceedings are proceedings in rem and

are directed against the res. It is no defense that the

owner of the vessel sought to be forfeited had no

actual knowledge that his property was used

illegally. The absence or lack of actual knowledge of

such use is a defense personal to the owner himself

which cannot in any way absolve the vessel from the

liability of forfeiture.

Facts:

Private respondents Manila Star Ferry, Inc. and the

United Navigation & Transport Corporation are

domestic corporations engaged in the lighterage

business and are the owners and operators,

respectively, of the tugboat Orestes and the barge-

lighter UN-L-106. Private respondent Ceaba

Shipping Agency, Inc. (Ceaba) is the local shipping

agent of the Chiat Lee Navigation Trading Co. of

Hongkong, the registered owner and operator of the

S/S Argo, an ocean-going vessel.

On June 12, 1966, the S/S Argo, the Orestes and the

UN-L-106, as well as two wooden bancas ofunknown ownership, were apprehended for

smuggling by a patrol boat of the Philippine Navyalong the Explosives Anchorage Area of Manila Bay.

The patrol boat caught the crew of the S/S Argo in

the act of unloading foreign-made goods onto the

UN-L-106, which was towed by the Orestes and

escorted by the two wooden bancas. All of the goods

consisting of 330 cases of foreign-made cigarettes,assorted ladies' wear, clothing material and plastic

bags were not manifested and declared by the vessel

for discharge in Manila. No proper notice of arrival

of the S/S Argo was given to the local customs

authorities.

Consequently, seizure and forfeiture proceedings

were separately instituted before the Collector of

Customs for the Port of Manila against the S/S Argoand its cargo, the Orestes, the UN-L-106 and the two

bancas, charging them with violations of Section2530 (a), (b) and (c) of the Tariff and Customs Code.

Criminal charges were likewise filed against the

officers and crew of said vessels and watercraft.

The Collector of Customs rendered a consolidated

decision declaring the forfeiture of said vessels and

watercraft in favor of the Philippine government by

virtue of Section 2530 (a) and (b) of the Tariff and

Customs Code.On separate appeals taken by all the respondents

therein, except the owner of the two wooden bancas,

the Acting Commissioner of Customs found theCollector's decision to be in order and affirmed the

same accordingly.

The same respondents separately elevated the matter

to the Court of Tax Appeals, which substantially

modified the decision of the Commissioner ofCustoms, ordering only the payment of a fine, in lieu

of the forfeiture of vessels. In its decision, the Court

of Tax Appeals held that while the S/S Argo was

caught unloading smuggled goods in Manila Bay, the

said vessel and the goods cannot be forfeited in favor

of the government because the Port of Manila is a

port of entry (R.A. 1937, Sec. 701).

The Commissioner of Customs argues that the phrase"except a port of entry" should mean "except a port

of destination," and inasmuch as there is no showingthat the Port of Manila was the port of destination of

the S/S Argo, its forfeiture was in order.

Hence, this petition for review under Rule 44 of the

Revised Rules of Court

Issues:


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1. Whether or not the S/S Argo, a vessel

engaged in smuggling "in a port of entry", can be

forfeited.

2. Are forfeiture proceedings in rem?

Held:

1. Section 2530(a) of the Tariff and CustomsCode in unmistakable terms provides that a vessel

engaged in smuggling "in a port of entry" cannot be

forfeited. This is the clear and plain meaning of the

law. It is not within the province of the Court to

inquire into the wisdom of the law, for indeed, we are

bound by the words of the statute. Neither can we putwords in the mouths of the lawmaker. A verba legis

non est recedendum.

It was only in 1972, after this case was instituted,

when the questioned exception ("except a port of

entry") in Section 2530(a) of the Tariff and Customs

Code was deleted by P.D. No. 74.

Nevertheless, although the vessel cannot be forfeited,

it is subject to a fine of not more than P10,000.00 forfailure to supply the requisite manifest for the

unloaded cargo under Section 2521 of the Tariff andCustoms Code.

The barge-lighter UN-L-106 and the tugboat Orestes,

on the other hand, are subject to forfeiture under

paragraph (c) of Section 2530 of the Tariff and

Customs Code. The barge-lighter and tugboat fall

under the term "vessel" which includes every sort of

boat, craft or other artificial contrivance used, or

capable of being used, as a means of transportationon water (R.A. No. 1937, Section 3514). Said section

2530 (c) prescribes the forfeiture of any vessel or

aircraft into which shall be transferred cargo unladencontrary to law before the arrival of the vessel or

aircraft at her port of destination. Manila was not the

port of destination, much less a port of call of the S/S

Argo, the importing vessel. The S/S Argo left

Hongkong and was bound for Jesselton, NorthBorneo, Djakarta and Surabaja, Indonesia; and yet it

stopped at the Port of Manila to unload the smuggled

goods onto the UN-L-106 and the Orestes.

2. Forfeiture proceedings are proceedings in

rem and are directed against the res. It is no defense

that the owner of the vessel sought to be forfeited had

no actual knowledge that his property was used

illegally. The absence or lack of actual knowledge ofsuch use is a defense personal to the owner himself

which cannot in any way absolve the vessel from theliability of forfeiture.

WHEREFORE, the consolidated Decision dated

September 30, 1969 of respondent Court of Tax

Appeals in C.T.A. Cases Nos. 1836, I837 and 1839 is

MODIFIED as follows: (1) that the S/S Argo through

respondent Ceaba Shipping Agency, Inc. is ordered

to pay a fine of P10,000.00, to be satisfied from the

deposit of the same amount by respondent Ceaba to

the Cashier of this Court per Resolution of July 9,

1978; (2) that the Cashier of this Court is ordered to

release the said amount for payment to the

Commissioner of Customs, within thirty (30) daysfrom the date this decision becomes final; and 3) the

tugboat Orestes and the barge-lighter UN-L-106 ofrespondents Manila Star Ferry, Inc. and the United

Navigation & Transport. Corporation respectively,

are ordered forfeited in favor of the Philippine

Government.

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