G.R. No. L-22990 - Capulong vs. Acting Commissioner of Customs

Case Summary (G.R. No. L-22990)

Factual Background

The record stated that the imported merchandise was not covered by any import license nor release certificate from the Central Bank of the Philippines, as required by Central Bank Circulars Nos. 44 and 45. On that basis, the Commissioner of Customs forfeited the shipment, relying on the authority of those circulars and on Section 1363 (f) of the Revised Administrative Code. Although the forfeited goods were released and delivered to petitioner on a surety bond—Surety Bond No. 117—the bond was issued by the Pioneer Insurance & Surety Corporation for the amount of P8,448.00.

Seizure Proceedings and the Commissioner of Customs Decision

On June 2, 1960, the Commissioner of Customs rendered judgment in the seizure proceedings. The Commissioner declared the surety bond confiscated and ordered petitioner and the surety corporation to pay jointly and severally the amount of P8,418.00 to the Bureau of Customs within thirty (30) days from receipt of a copy of the decision, consistent with the undertaking stated in the surety bond.

Court of Tax Appeals Review

Petitioner filed a petition for review with the Court of Tax Appeals. After proper hearing, the Court of Tax Appeals affirmed the Commissioner of Customs’ judgment. It imposed costs against petitioner.

Arguments Raised in Review Before the Court

In seeking further review, petitioner advanced several lines of contention. First, petitioner argued that the Court of Tax Appeals erred in declaring forfeiture merely because it violated Central Bank Circulars Nos. 44 and 45, insisting that those circulars allegedly did not provide for forfeiture as a penalty for noncompliance. Second, petitioner contended that forfeiture could not be legally sustained because the circulars had supposedly already been repealed by Central Bank Circular 333 (as stated in the text), thereby allegedly undermining the basis for forfeiture. Third, petitioner maintained that upon the expiration of Republic Act No. 650, the Commissioner of Customs allegedly lost jurisdiction, rendering the decision null and void.

Forfeiture for Violation of Central Bank Circulars Nos. 44 and 45

The Court treated the first issue as settled. It held that Central Bank Circulars Nos. 44 and 45 must be correlated with Section 1363 (f) of the Revised Administrative Code, which authorizes forfeiture of “any merchandise of prohibited importation” or “any” merchandise “the importation of which is effected contrary to law.” The Court relied on prior rulings, including Pascual vs. The Commissioner of Customs, L-10979, June 30, 1959; Venancio Tonk Tek vs. Commissioner of Customs, L-11947, June 30, 1959; and People vs. Que Po Lay, 50 Off. Gaz., No. 10, p. 4800.

In explaining why forfeiture could still be imposed despite the absence of an express forfeiture penalty in the circulars, the Court emphasized that the circulars were issued within the scope of the Monetary Board’s powers. It noted that they had been published and became enforceable. The Court further reasoned that an importation made without the necessary import license and without the required release certificates falls within the legal class of importations effected contrary to law. The Court rejected petitioner’s attempt to render the forfeiture provision ineffective, stating that doing so would defeat the aim of the law that empowered the Central Bank to restrict or suspend foreign exchange sales and licensing during periods of exchange crisis to protect reserves and to allow the government time to adopt constructive measures.

“Customs Law” Includes Regulations Enforceable by the Bureau of Customs

The Court also clarified that petitioner’s argument overlooked the meaning of “customs law.” The Court held that “customs law” embraces not only the provisions of the statute itself but also regulations issued pursuant to it and subject to enforcement by the Bureau of Customs. Thus, because Central Bank Circulars Nos. 44 and 45 were regulations issued pursuant to law and enforceable by the Bureau of Customs, their violation fell within the purview of Section 1363 (f) of the Revised Administrative Code. Accordingly, even if the merchandise was not characterized as “prohibited importation” in the strict sense, the importation remained an importation effected contrary to law and therefore subject to forfeiture.

Alleged Repeal by Central Bank Circular 333 (Central Bank Circular 133)

On petitioner’s second contention, the Court held that it lacked merit. It stated that Central Bank Circular 133 had not “exactly repealed” Central Bank Circulars Nos. 44 and 45, but had reenacted them by providing that existing regulations not inconsistent with the circular were deemed incorporated and made integral parts thereof by reference. The Court found a common purpose among the circulars: to require presentation of a Central Bank release certificate before any importation could be made. It characterized the underlying objective as keeping account of import volume so that the Central Bank could survey and study appropriate measures to remedy a prolonged financial crisis.

Further, the Court addressed the implied-repeal theory. It held that even assuming an implied repeal, the repeal could not abate the forfeiture proceedings already instituted. It reasoned that forfeiture proceedings were civil in nature and not criminal. Hence, repeal could not be given retroactive effect to defeat the already-pending forfeiture case.

Expiration of Republic Act No. 650 and Jurisdiction of the Commissioner of Customs

On the jurisdiction argument, the Court rejected it as untenable. It reiterated the rule that once a tribunal, judicial or administrative, acquires jurisdiction over a case, it retains that jurisdiction even after the law governing the case expires. The Court distinguished between the effect of the expiration of a law and the abrogation of a law. It held that where jurisdiction had already attached while the law was in force, the mere expiration of Republic Act No. 650 did not divest the Commissioner of Customs of jurisdiction over the matter until final determination.

The Court relied on Roxas vs. Sayoc, G.R. No. L-8502, November 29, 1956, which it quoted, to emphasize that expiration could not retroactively declare the previously illegal importation lawful, nor could it render the Collector of Customs’ seizure and forfeiture decision null and void if that decision had been rendered while the law was still in force. The Court underscored that the main question on

Case Syllabus (G.R. No. L-22990)

Bienvenido Capulong imported thirteen (13) packages of salted fish in bulk and hams from Hong Kong to the Philippines under Import Entry No. 81851, series of 1954.
The shipment was not covered by an import license or a release certificate from the Central Bank of the Philippines as required by Central Bank Circulars Nos. 44 and 45.
The Commissioner of Customs forfeited the merchandise under the authority of Central Bank Circulars Nos. 44 and 45 and also in relation to Section 1363 (f) of the Revised Administrative Code.
Despite forfeiture, the shipment was released and delivered to the petitioner through Surety Bond No. 117, executed by the Pioneer Insurance & Surety Corporation, in the amount of P8,448.00.
On June 2, 1960, the Commissioner of Customs rendered judgment in the seizure proceedings, declaring the bond confiscated and ordering petitioner and the surety to pay, jointly and severally, P8,418.00 to the Bureau of Customs within 30 days from receipt of the decision, consistent with the surety bond terms.
Petitioner sought review before the Court of Tax Appeals, and that court affirmed the Commissioner’s judgment with costs against petitioner.
Petitioner then appealed again to the Court, maintaining the same core challenges to the forfeiture.

Key Factual Allegations

On October 15, 1954, petitioner imported the subject food commodities and filed the corresponding customs entry under Import Entry No. 81851, series of 1954.
Petitioner failed to secure the required Central Bank release certificates and import license for the importation in question.
The Commissioner of Customs treated the omission as a ground for seizure and forfeiture.
The merchandise was nevertheless released upon petitioner’s bond posting, but the forfeiture proceeding culminated in confiscation of the bond and a money judgment against petitioner and the surety.

Issues Presented for Review

The Court addressed whether the Court of Tax Appeals erred in ordering forfeiture based solely on violation of Central Bank Circulars Nos. 44 and 45, given petitioner’s claim that the circulars did not expressly provide forfeiture as a penalty.
The Court considered whether Central Bank Circulars Nos. 44 and 45 remained operative for purposes of forfeiture after the issuance of Central Bank Circular 333.
The Court evaluated petitioner’s contention that the Commissioner of Customs lost jurisdiction upon the expiration of Republic Act No. 650, rendering the Commissioner’s decision null and void.

Statutory and Regulatory Framework

Section 1363 (f) of the Revised Administrative Code authorized the forfeiture of merchandise of prohibited importation or merchandise the importation of which is effected contrary to law.
Central Bank Circulars Nos. 44 and 45 required importers to present release certificates issued by the Central Bank or its duly authorized agent banks and to secure the necessary import license issued by the Monetary Board pursuant to the circular requirements.
The Court treated “customs law” as encompassing not only statutory provisions but also regulations enforceable by the Bureau of Customs issued pursuant to law.
The Court considered Central Bank Circular 333 (referred to in the text as Central Bank Circular No. 133) as reenacting earlier circulars rather than fully repealing them, through a clause deemed to incorporate existing consistent regulations by reference.

Contentions of the Parties

Petitioner argued that forfeiture could not legally be imposed merely because of violation of Central Bank Circulars Nos. 44 and 45, since petitioner asserted the circulars themselves did not specify forfeitu