G.R. No. 158150 ; September 10, 2014
AGRIEX CO., LTD., Petitioner, vs. HON. TITUS B. VILLANUEVA, Commissioner, Bureau of Customs (now replaced by HON. ANTONIO M. BERNARDO), and HON. BILLY C. BIBIT, Collector of Customs, Port of Subic (now replaced by HON. EMELITO VILLARUZ), Respondents.

FACTS

Petitioner Agriex Co., Ltd., a foreign corporation, entered into contracts to sell 200,000 bags of Thai white rice. It chartered the vessel MV Hung Yen to transport the rice to the Subic Free Port for transshipment to consignees in Fiji, Indonesia, and Cebu City. The vessel arrived at Subic on August 20, 2001, but was allowed to berth only on September 11, 2001. The Bureau of Customs initially granted a clearance for the vessel to exit for Malaysia on August 24, 2001, but it did not sail. On September 10, 2001, petitioner requested permission to unload the entire shipment. Based on an After Mission Report, respondent Commissioner Titus B. Villanueva directed respondent Collector of Customs Billy C. Bibit to issue a Warrant of Seizure and Detention (WSD) against the 20,000 bags consigned to R&C Agro Trade. Collector Bibit issued WSD No. 2001-13 on September 12, 2001. After unloading, amended WSDs were issued on September 27, 2001, to cover the vessel and the remaining 180,000 bags intended for transshipment, based on information from Indonesian and Fijian authorities that the consignees were non-existent or not engaged in rice importation. Petitioner filed an Urgent Motion to Quash the WSDs. Pending seizure proceedings, Collector Bibit issued a Notice of Sale on October 18, 2001, scheduling an auction. Petitioner filed a petition for certiorari and prohibition in the Court of Appeals (CA) to nullify the Notice of Sale, alleging grave abuse of discretion and lack of jurisdiction over the transshipment goods. The CA issued a temporary restraining order. Meanwhile, on November 14, 2001, Collector Bibit denied the motion to quash and ordered forfeiture of the shipments. Petitioner appealed to Commissioner Villanueva, who issued a Consolidated Order on February 4, 2002, modifying the order by granting settlement for the 20,000 bags but affirming the forfeiture of the 180,000 bags. The rice was eventually auctioned, and the proceeds were deposited. The CA dismissed petitioner’s petition on November 18, 2002, upholding the Bureau of Customs’ jurisdiction and finding no denial of due process.

ISSUE

Whether the Bureau of Customs has exclusive jurisdiction over seizure cases within the Subic Freeport Zone.

RULING

Yes. The Supreme Court affirmed the exclusive jurisdiction of the Bureau of Customs over seizure cases within the Subic Freeport Zone. The Court held that while the Port of Subic is a free zone under Republic Act No. 7227 , ensuring free movement of goods, the Bureau of Customs retains jurisdiction when probable cause exists that foreign goods are contraband or smuggled. The issuance of the Warrant of Seizure and Detention was based on information from foreign authorities indicating the consignees were non-existent, justifying the seizure. The Court further ruled that the petitioner was not denied due process as it was given the opportunity to be heard through its motions and appeals within the administrative process. The proper remedy for aggrieved parties from a decision of the Commissioner of Customs is an appeal to the Court of Tax Appeals, not a petition for certiorari to the Court of Appeals. Thus, the Court of Appeals correctly dismissed the petition.