CTA Case No. 2803 (Decision)

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY PROCTER & GAMBLE PHILIPPINES MANUFACTURING CORPORATION, F'e t i""t i oner-, - versus - C.T.A. CASE NO. 2803 COMMISSIONER OF CUSTOMS, Respondent. X- - - - - - - - - - - - - X DEC I s I D .N Assailed in this petition for� r�evi e w i s the decision of re s pondent Co mmi s sion e r- oJ Cu s to ms dated Mar�ch 12, 1976 affirming the de cision of the Collector of Cus toms of the Po rt of Manila, dated December 13, 1974 which dismissed the protests f i 1ed by petitioner� Procter 1!~ Gamb 1e Phi 1 i ppines Manufa c tur. in( l Corporation against the assessme nt and collection of additional customs duties and ta:�:es plus surcharges on importations of trichlorocarbanilide. �8

DEC IS I 01\l CTA CASE NO. 2 803 2 ~- The �fa c ts, together with t he i ss u e , as succinctly s t ated by respondent Commi s si o n e r a re as - .:. 'follm'ls: Re c ords of thi s c a s e r e v e al that three (J) s hipment s of Trichloro - r::: a r ban i 1 i de , to N i t : 50 d r u ms e .~� SIS "Galli" Nith Reg. No. 1468 .: 60 drum:..� e x SIS "Phil. Rizal" Nith Reg. No. 1948; and 6CJ drum .:; ex SIS "Tung Ching" Nith Reg. No. 22(:',7 .� con s igned to Pro c ter'~ Gamble Phil. Mfg., arrived at the Port of Manila on various dates. Upon arrival, the s ubject� s hipment s Nere de c lar e d at the Port oF Manila under Import E ntry No ::: . 78279, 97127 and 11 4 8f)7, all :; erie:..:; o1- .t96 '.'9 .� re s pectively. � In the sai d import entrie:..� .� t�he declared v a lue o f on e (.t) pound of Trichloro c: arb a nilide Nas $ 2 .04. � .. In the pror:::e:.; :.=: o1~ appra.i s,:-~.l of th e s aid entrie s for the pu r po se o f determining the cor r e:..:; pond ing du t i e�s and taxes due on the :..:; h .i p m.e n t:..:; , the dec 1 a r e d value in Import Entry No. 78279 Na s inr:::rea:..:;ed to $2.25 per pound by the as:..:;igned Customs Appraiser, a:_:; well a:_:; in Import Entry No :..:; . 97129 and 114807 Nherein the dec:l~red value:..:; of $2.04 per pound Nere increa:..:;ed to $2.90 and $2.25, re:..=:pecti~~ely. A:..:; a result of the apprai:..:; 9 ls made by the Custom:_:; Appraiser:..:; concern ��d , di:..:;crepancie s in cu:..:;tom:..:; dutie:..� and ta ..,.�e:..:;, together Nith :..:;urcharge, re:..:;ulted in the amount:..=: of P751.(JCI (Entry 7827:'9J, P5,541.(U) (Entry 97129) ancl P912.00 (Entry 114807) Nhicfl Ner e paid by the herein con:_:; i gn f?e un cler Off' icial Receipt Nos. C13-701CJ2 dated September 19 1 1969, CB-84990 dated December 9, 1969 and CB -- 98823 dated January 19, 1970, re:..:;pectively. Said payment s Nere, hoNe~'er, et"fected by the herein con:..:;ignee under � prote:..:;t:..:; and C�2

DECISION --� CTA CASE NO . 2803 - ::_::; docketed at the Port of Nanila as Nanila Protest No s . 4135 (Entry 78279), 4138 (Entry 97129) and 4140 (Entry 114807) on t h e g r o u n d t h a t t h e ~~ c1 1 u e o 1~ $ 2 � f) 4 per pound of Trichlorocarbanilide dec lared in the said import entries Nere the correct ~~alue. Ac ting on the s aid prot es ts, the Collector of Custom s of the Port of Nanila .� in hi:..:: deci:..::i on dated December 13, 1974, dismissed said protests for lack of merit, hence, this appeal. The fa,:t :.-. ot" this �.: <:i::>e Nere not in di s pute and the only issue to be resolved is the determination of the correct valu e of tr.i c hlorocarbanilide at the t~.� me of exportation f~o~ the countty of origin. Petitioner contends that the value declared in the consular and commercial invoices is the correct hom!? consumption value pur��s u ;::mt: to Section 201 of the applicable Tariff and Customs Code of the Philippines. While it .i s t.r�ue that the customs .::l. pprai ser m <:~y n~~ j e~c t the va 1 ue appear- in(] in the consular and commercia l invoices, th~ law express ly requires that there be a reasonable basis for doubting the veracity of .iuch valuation. Petitioner therefore submits that in disregarding the values appearing in th~�consular and commercial invoices and other- documents pr~esen ted by it, and in imposing his own ~aluation, the a ppraiser acted contrary to law, spe?ci�fically, the CEJ

DECISION ��� CTA CASE NO. 2803 �- 4 ..... provisions of Section 201 of the arplicable Tariff - .> and Cus toms Code. We agree. Under an .3. l ogous cond i t. ic.m~:;, the Supreme Court has a 1 ready r-u 1ed in Commi ss ioner of Customs vs. Court of Tax Appeals and Bell Hobart Manufacturing~ Inc., G.R. No s . L- 48144-47, June 28, 1988: XX .ll' XXX The IaN :..=:ee m:..=: clear and :..=:pecif i c. It- merely calls for it:_-:.: appl.i~::: ation a:..:; Norded. There is no room for interpretation. "The h o me cons umption ~~ a 1 u e o r p r .i c: e u n de r t .h..:i.. 2........ "~fE..~;_.f; _i _.Ql'!. .......�_IJ..?!.L~- ~YL____t.hR... �---~~-~..!__y,g___..__f,!.L ..._,_p_r__j,__ !;J~-- -....!.1...e..!;.l...~. Cf!..'1.....__Jn,.........tl..?. g_. !.-';'_!;1_D..;.,".4...4. ~. r..L.......__,;:;_Q..m.m.e.r._r;;;_i__~.L~...... _.t..r. .?...r;fg~-............P.r..._____:,u~..l_g__:,:;_ j_[I_Ei!..l.~;;;_g__ . H XXX .1\'.)('X XXX Goinq back tQ the .in ::>tant r::a;..:; e ::.�, i t s hould /:.le UTH~quivocally ;..:;ta te cl .� a;..:; the records Ni.ll s hoN, that there Na s no published value of the subjec t st-eel Nir e rod :.." ./ ec .larf!d or d.i :..::::_:;e m.ina te d by re;..:;pondt t, a:_:;- required L1y paragraph .3' o �f Section 201, d.isr:::u:...::: :.:: ed abo~'e. Clearly, therefore, there Na s no r ea:...:;on ab 1 e doubt entertained by respondent Commissioner of Cu ::; t�oms as to the va .lue or prir::: e o1~ the imported :_-:.: teel Nire rods declar ed in the en t r i e :..=; .: o the no.~ i s e , a :..:: man d a ted by the iaN, the correct dutiable ~1 alue of t�he :...:::hipment ;_:: in que;..:;tion :_::hould ha~'e been a:...:::cer tained from report:...::: of the Revenue At tache or Commer c: i a 1 At tache or other Philippine Diplomatic officers and from :.."uch other int"ormation that may be a~'ailable to the Bureau of Cu;..:;toms, and

DECISION CTA CASE NO. 2803 ,. - .J ��- f r o m t-he d a t�a g a the r e d .� t-he C.o mmi ::; :.=: i on e r o1~ Cu :.'- t�om;.:; :.'-hou I d h a ve ascertained and establi;.:;hed the home consumption value of the import-ed art-icle. Ac c ordingly, under the second paragraph of Se c tion 201, s upra, the home consumption value or price should L1e th�e ~~alue or price declared i n the consular, c ommercial, t r ad e or :.::a I e;.:; i n ~' o i c e � S i n c e t-he r e i -:;� no Lide.lity nor compliance o1" Nhat are required L1y �the legal prcwision:.'- applicable, in the ab s ence of evi den ce to the contrary , there is no basi s therefore for the as;.:;ertion of respondent th at the correc ~ value of the imported steel Nire rod;.:; i at ~~."325.CJ(J per metric ton. The t e r m:.'- of the s t a t u t e p r o ~~ .i de t�he safe:.=: t guide as to the stat-utory policy, to Nhich obedience is due and fro m Nhich deviation is not- alloNable. (Padilla vs. City of Pa s ay, L-24039, June 29, 1962, 23 SCRA 1 3 49.) F ina 11 y, the Supr� eme Court's pr��onouncement in Commissioner � of Cu~;torns v s � .Court. of Ta:< Appeals, G.R. No. 70648, July 31, 1987, is apt . J.J h.ile it i:.'- true that apprai :.=: er s of the Bu rea u of Cu s tom s are given ample leeNay in determining the corre c t c ustom ;.:; duties under Section 14CJ5 of the Tarit"f and Cu s toms Code, Section 201 of th e same Code .� 111 hi c h pres c r i be::; the c r .i t e r i a for the determination of the dutiable value s o�f importe�.1 article :.::, ha:_::; not been com p .l i e d 1<1 i t h � J.J h a t .z s mor e , administrative proceeding s are not exempt from the operation of due pro ces::; requirement one of Nhich is that a finding by ~n.:. admini;.:;trative tribunal should be supported by subs tantial e ~~ i den c e p r e s ~~ r; ted a t the he a r i n g or a t lea::;t co ntained in the record;.-. or �.ii:H:lo :.=:e d to the partie ;.-. a1"fected. In

r ., DECISION -- CTA CASE NO. 2803 -- 6 -� this ca s e the 'Alert Noti c e:_:; �� (or allege,.i e;;: tab 1 .i s hed ~~a 1 u e :_:: ) on N h i c h p e t i t i on e r (Commi :..~:;; ioner o1" Cu:..:;tom:_:::) ba :..:;e d i t :.:.; re - apprai :..,a l Nere not d .i;..:;clo:..:;ed during the proceeding :_:; before the Bureau of Custom :_:: nor pre:..:::e nted in evidence before respond~nt Court. The re - apprai:..:::al mad e L1y pet it-ioner, therefore, c an be faulted Nith arbitrarine:..::::..::: in di :..:; regard of the ;..:; tandard of due pro c e s;..:; to Nhich all governmental action s hould c onfor m to impres s upon it the s tamp of validity. Accor-dingly, the in sta n t peti.t.i.on �for- r�eview is her-eby g r� an ted and r-e s ponc:f c.,?n t Co mmis s ion�,?!'" of Customs is ur-der-ec:f to r-efund to pe ti tioner- Pr-octer- & Gambl e Philippines Manufact ur-ing Cor-por-ation, as a conseque n ce of the r� e-�� ~3p pr� aisal, t h e additiona l dutie s and taxe s , kdgethe r- with s ur- c har-ge, paid in the following a mc:; unts: (a) P751.00 in Entr-y No. 78279; (b) P5,541.00 in Entr-y No. 971 2 9; a nd (c) P912.00 in Entr-y No. 2 24807 . WHEREFORE, the appeal e d decision is r-ever-sed. No costs. SO ORDERED. Que zon City, Metr-o Manila, November- 16, 1988. AMANTE Pr-esidin

--- ~ - DECISION �-- -- '7 ..... CTA CAS E NO . 2803 'WE CONCUR: Ass o cia t e Judge CERT I F I CAT I 0 N I here by certify that t h i s d ec i sion was reached aft e r due c on s ult atio n a mong th e me mb e rs o f the Cou r t of Ta x Appeal s i n ac cord an ce wi t h Se c tion 1 3 , Ar t ic l e VII I of t h e Con st i t ut i on. AMANTE ILLER Pr-�r::~<::i di fl g J u dge Court o f Tax Appea ls