G.R. No. 139803 - Commissioner of Internal Revenue vs. La Suerte Cigar and Cigarette Factory Inc.

On 29 September 2001, a cargo shipment described as “agricultural product” and valued at US$6,000 arrived at the Port of Subic, within the Subic Bay Freeport Zone.
Based on its declared value, customs duties and taxes amounting to P57,101 were imposed and paid by respondent WIRA, the shipment’s consignee.

On 23 October 2001, Acting COO III of the Bureau of Customs, Port of Subic (Raval Manalas) issued a memorandum stating that the shipment was found to contain rice.
The memorandum explained that:

The importer claimed a “misshipment” as they had a pending order for rice.
The “warehousing entry” was amended to change the description from “agricultural product” to rice.
As a warehoused cargo inside the freeport zone, the shipment was initially duty and tax free, and no penalty was recommended.
The consumption entry was similarly changed to indicate rice shipment with supporting documents submitted belatedly.

On 24 October 2001, Hilda Bacani, acting as the authorized representative for Metro Star Rice Mill (the importer), wrote to the BOC Subic Port District Collector.
Bacani claimed that there was a “misshipment” (the cargo actually contained rice) and requested that the classification be upgraded from “agricultural product” to rice, manifesting willingness to pay the corresponding duties and taxes.

On 25 October 2001, the BOC issued Hold Order No. 14/C1/2001 1025-101, directing that the shipment be held in the port and transferred to a security warehouse.
Respondent WIRA, as the consignee, paid additional duties and taxes on 26 October 2001 amounting to P259,874 for the upgraded shipment.
On 30 October 2001, BOC Commissioner Titus Villanueva issued a directive allowing the release of the shipment subject to further payments based on an upgraded valuation and compliance with regulations.
Respondents made a further payment on 28 November 2001 amounting to P206,212 as untaxed duties.

On 4 December 2001, Fertony G. Marcelo, Officer-in-Charge of the Cash Division of BOC Subic Port, issued a certification confirming that respondents had remitted customs revenue amounting to P523,187.
A Gate Pass was subsequently issued on 3 December 2001 by Chief Assessment, affirming that the shipment’s release was aligned with the payments and administrative directives.

On 11 June 2002, respondents filed a complaint for Injunction and Damages with prayer for a writ of preliminary, prohibitory, or mandatory injunction against petitioner SBMA and its representative, Augusto L. Canlas.
On 13 June 2002, the Regional Trial Court (RTC) of Olongapo City, Branch 72, issued a Temporary Restraining Order (TRO) granting injunctive relief, and the TRO was served on the defendants later that day.
On 14 June 2002, when court officers verified compliance with the TRO, defendants/respondents—represented by their counsels—refused to acknowledge the order, alleging its illegality.

On 17 June 2002, respondents filed an indirect contempt charge against the defendants for defying the TRO, alleging disobedience of a lawful court order.
The trial court conducted hearings on (a) the indirect contempt charge on 12 July 2002 with the presentation of evidence by the plaintiffs, and (b) subsequent evidentiary filings by the defendants aimed at asserting that the Bureau of Customs (BOC) had exclusive jurisdiction.
On 19 July 2002, SBMA and Canlas filed their Answer to the complaint, and on 1 August 2002 a Consolidated Motion to Dismiss was filed asserting that there was an existing BOC warrant of seizure and detention against the shipment.
The RTC rendered two separate orders:

On 21 November 2002, it found the defendants guilty of indirect contempt and imposed fines and a short imprisonment sentence.
On 27 November 2002, it suspended the injunction proceedings pending resolution of the BOC case (Seizure Identification No. 2002-10) concerning the same shipment.

Petitioner SBMA filed a petition for Certiorari and Prohibition with a prayer for a TRO and injunction before the Court of Appeals (CA) to nullify the RTC orders dated 21 and 27 November 2002.
On 20 June 2003, the CA dismissed the petition for lack of merit and affirmed the RTC orders.
Petitioner’s subsequent motion for reconsideration was also denied on 8 October 2003.

Whether the RTC properly exercised jurisdiction over the action for injunction and damages involving the shipment given that it was handed over to the BOC's control under a warrant of seizure and detention.
Whether the existence of the warrant of seizure and detention transferred exclusive jurisdiction from the RTC to the Bureau of Customs.

Whether the SBMA officers’ refusal to comply with the TRO constituted indirect contempt given their claim of good faith based on the BOC’s exclusive jurisdiction over the shipment.