Case Digest (G.R. No. 183868)
Facts:
Commissioner of Customs v. Marina Sales, Inc., G.R. No. 183868, November 22, 2010, Supreme Court Second Division, Mendoza, J., writing for the Court.
The petitioner is the Commissioner of Customs (through the Office of the Solicitor General); the respondent is Marina Sales, Inc., a manufacturer appointed by CO-RO Food A/S (Denmark) to produce Sunquick juice concentrates in the Philippines. Marina regularly imported juice compounds as raw materials and historically paid duties under H.S. 2106.90 10 at a 1% rate.
On March 6, 2003 Marina imported goods under Import Entry No. C-33771-03 (a 20' container with 80 drums of various Sunquick concentrates) and on May 21, 2003 it imported goods under Entry No. C-67560-03 (another 20' container with 80 drums of assorted concentrates). Each shipment was supported by bills of lading and supplier invoices; Marina initially computed and paid duties at the 1% rate. BOC examiners, however, recommended reclassification to H.S. 2106.90 50 (composite concentrates for simple dilution) at 7%.
Marina sought and obtained tentative release of the shipments subject to its undertakings to pay any correct reclassified duties. The Valuation and Classification Review Committee (VCRC) convened deliberations (Marina submitted explanations and samples), and the cases for the two entries were consolidated. On September 11, 2003 the VCRC reclassified the entries under H.S. 2106.90 50 at 7%, but on November 13, 2003 the VCRC issued a modified indorsement classifying the entries under various H.S. headings (including H.S. 2009 series) with differing rates.
Marina filed a petition for review with the Court of Tax Appeals (CTA) on February 3, 2004 (CTA Case No. 6859). On October 31, 2007 the CTA Second Division granted Marina's petition and set aside the VCRC's November 13, 2003 decision, holding that the proper classification for the disputed imports was H.S. 2106.90 10 at 1% because the imported compounds were raw materials that lost their original character and required further manufacture. The decretal portion of the Second Division ordered reclassification to H.S. 2106.90 10 at 1%.
The Commissioner of Customs filed a petition for review to the CTA En Banc, but the CTA En Banc, in its April 11, 2008 Resolution (C.T.A. E.B. No. 333), dismissed the petition for failure to file a motion for reconsideration with the Division, invoking Section 1, Rule 8 of the Revised Rules of the Court of Tax Appeals. The Commissioner sought reconsideration of that dismissal; the CTA En Banc denied it in its July 14, 2008 Resolution. The Commissioner then filed this petition for review on certiorari under Rule 45 before the Supreme Court challenging (a) the CTA En Banc's dismissal on procedural grounds and (b) the substantive classification favoring Marina.
...(Subscriber-Only)Issues:
- Was the CTA En Banc correct to dismiss the Commissioner's petition for review for failure to file a motion for reconsideration with the CTA Second Division in violation of Section 1, Rule 8 of the Revised Rules of the Court of Tax Appeals?
- On the merits, was the CTA Second Division correct in classifying Marina’s importations under H.S. 2106.90 10 at a 1% import duty rate rather than H.S. 2106.90 50...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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