SERREE INVESTMENT COMPANY, PETITIONER, VS. COMMISSIONER OF CUSTOMS, RESPONDENT.

REYES, J.B.L., J.:

Petitioner seeks review of a decision of the Court of Tax Appeals (Customs
Case No. 84) affirming the validity of the forfeiture of merchandise imported by
said petitioner, Serree Investment Company. The facts were submitted under a
stipulation of facts, as follows:

“1. That petitioner is the consignee of 500 packages of fresh potatoes
imported from Hongkong which arrived in the Port of Manila on January 1, 1955 on
board the SS ‘Straat Bali’, Reg. No. 1384 (Entry No. S6614-14);

“2. That the petitioner is likewise the consignee of 120 packages of garlic
imported from Hongkong which arrived in the Port of Manila on October 30, 1954
on board the SS ‘Liberal’, Reg. No. 1384 (Entry No. 26614-14);

“3. That the shipments in question did not have any Central Bank Release
Certificate submitted, for which reason they were seized by the Appraiser’s
Division of the Bureau of Customs for alleged violation of Central Bank
Circulars Nos. 44 and 45 in relation to Sees. 1363(f) and 1250 of the Revised
Administrative Code;

“4. That ruling on the seizure and forfeiture proceedings, the Collector of
Customs ordered the forfeiture of the aforementioned shipments in favor of the
Government, from which ruling appeal was taken to the respondent Commissioner of
Customs;

“5. That upon request, petitioner was allowed to redeem under protest the
forfeited shipments as per orders of Collector of Customs dated January 8, 1955
and December 18, 1955, upon payment of the redemption values thereof in the
amounts of P7,859.91 and P25,520.46, respectively;

“6. That thereupon, the petitioner filed a protest to test the validity of
the redemption proceedings, which was denied by the Collector of Customs in its
decision dated April 4, 1956;

“7. That respondent Commissioner of Customs in his decision dated March 22,
I960, sustained the rulings of the Collector of Customs mentioned in paragraphs
5 and 7 hereof;”

“8. * * * * * * *.”

The Court of Tax Appeals ruled against petitioner herein and upheld the
forfeiture. Whereupon, the petitioner resorted to this Court, assigning the
following errors:

“1. The Court of Tax Appeals erred in not holding that the Central ‘Bank has
no power to regulate the importation of the merchandise in question.

“2. The Court of Tax Appeals erred in not holding that Central Bank Circulars
Nos. 44 & 45 are void insofar at least as they sought to regulate the
importation of the merchandise in question.”

The objections of the petitioner, in his assignment of errors, against the
validity of Circulars Nos. 44 and 45 of the Central Bank and the authority of
the Commissioner of Customs to forfeit the merchandises in question were
disposed of in a similar case involving the same petitioner herein. In
Commissioner of Customs vs. Serree Investment Company, 108 Phil., 1, this
Court, citing the case of Pascual vs. Commissioner of Customs, L-10797,
30 June 1959, stated:

“* * * Even granting; that the importations in question do not require an
immediate sate of foreign exchange, their importation into the Philippines from
another country will ultimately require the sale of such exchange. The currency
of out country is not legal tender in another. To pay for imports, traders have
to avail themselves of foreign exchange, which is the conversion of an amount of
money or currency of one country into an equivalent amount of money or currency
of another. Every import of goods or merchandise requires an immediate or future
demand for foreign exchange.

“Section 74. Republic Act No. 265. authorizes the Monetary Board, with the
approval of the President, to temporarily suspend or restrict sales of exchange
and to subject all transactions in gold and foreign exchange to license during
an exchange crisis in order to protect the international reserve and to give the
Monetary Board and the Government time in which to take constructive measures to
combat such a crisis. Circular No. 44. prohibiting the release by the
Commissioner of Customs of any item of import without the presentation of a
release certificate issued by the Central Bank or any authorized agent bank in
the form prescribed by the Monetary Board, and Circular No. 45, requiring ‘any
person or entity who intends to import or receive goods from any foreign country
for which no foreign exchange is required or will be required of the banks, to
apply for a license from the Monetary Board to authorize such import’, are
measures taken to cheek the unregulated flow of foreign exchange from the
country and are within the power of the Monetary Board.

“Appellant’s contention is that Congress had not authorized the Central Bank
to issue regulations governing imports that do not require the sale of foreign
exchange, because according to him, it would not have enacted into law Republic
Act No. 1410. The contention assumes that the importations do not require the
sale of foreign exchange, a fact which he failed to establish. “Appellant
contends that assuming that the importations in question require the sale of
foreign exchange in violation of Circular No. 44, yet they may not be forfeited
under the said Circular because it does not expressly provide for the penalty of
forfeiture.

** * Section 1363(f) of the Revised Administrative Code provides:

‘Vessels, cargo, merchandise, and other subjects and thing3 shall, under the
conditions hereinbelow specified, be subject to forfeiture;

*          *          *          *          *          *          *

(f) Any merchandise of prohibited importation or exportation, the importation
or exportation of which is effected or attempted contrary to law, and all other
merchandise which, in the opinion of the collector, have been used, are or were
intended to be used as instrument in the importation of exportation of the
former.

“* * *. But since the importations in question were made without the
necessary import license issued by the Monetary Board pursuant to Circular No.
45 and the release certificates issued by the Central Bank or its authorized
agent bank in the prescribed form pursuant to Circular No. 44, they fall within
the class of ‘merchandise of prohibited importation’ or merchandise ‘the
importation * * * of which is effected * * * contrary to law,’ that the
Commissioner of Customs may seize and order forfeited. * * *.”

The same views were upheld in Commissioner vs. Eastern Sea Trading,
L-14279, 31 October 1961: Pascual vs. Collector of Customs. L-12219, 25
April 1962; Commissioner vs. Nepomuceno, L-11126, 31 March 1962; and
Commissioner vs. Santos, L-11911, 30 March 1962.

Finding no error in the decision under review, the same is hereby affirmed,
with costs against the petitioner.

Bengzon, C. J., Bautista Angelo, Concepcion, Barrera,
Paredes, Dizon, Regala, Makalintal, Bengzon, J. P. and ZaJdivar, JJ.
concur.