G.R. No. 177188 ; December 4, 2008
EL GRECO SHIP MANNING AND MANAGEMENT CORPORATION, petitioner, vs. COMMISSIONER OF CUSTOMS, respondent.

FACTS

On September 23, 2001, the vessel M/V Criston docked at the Port of Tabaco, Albay, carrying 35,000 bags of imported rice consigned to Antonio Chua, Jr. and Carlos Carillo. The Bureau of Customs (BOC) Legaspi District Collector issued a Warrant of Seizure and Detention (Seizure Identification No. 06-2001) for the rice, and later another warrant (Seizure Identification No. 06-2001-A) specifically for M/V Criston, for leaving the Port of Manila without necessary clearance. While under BOC custody in Tabaco, the vessel was allowed to seek shelter from a typhoon but subsequently failed to return and was found in Bataan waters bearing the name M/V Neptune Breeze. The BOC District Collector of Manila then issued a Warrant of Seizure and Detention (Seizure Identification No. 2001-208) against M/V Neptune Breeze. The Legaspi District Collector rendered a Decision on June 27, 2002, ordering the forfeiture of M/V Criston, also known as M/V Neptune Breeze, and its cargo for violating the Tariff and Customs Code. Petitioner El Greco Ship Manning and Management Corporation, as the local agent of the registered owner of M/V Neptune Breeze, filed a Motion for Intervention and Motion to Quash the warrant before the Manila District Collector, claiming M/V Neptune Breeze was a different, foreign-registered vessel. The Manila District Collector granted the motion and ordered the vessel’s release on March 11, 2002. However, on automatic review, the BOC Commissioner reversed this order on January 15, 2003, finding that M/V Neptune Breeze and M/V Criston were the same vessel and that the Legaspi District Collector had prior jurisdiction. El Greco filed a Petition for Review with the Court of Tax Appeals (CTA) Second Division, which affirmed the BOC Commissioner’s decision, citing a PNP crime laboratory report showing identical serial numbers for the engines and generators of both vessels. The CTA Second Division also rejected El Greco’s argument that the Manila District Collector’s release order had become final. The CTA En Banc subsequently dismissed El Greco’s petition, upholding the Second Division’s findings.

ISSUE

Whether the Court of Tax Appeals correctly affirmed the forfeiture of the vessel M/V Neptune Breeze, having determined it to be the same vessel as M/V Criston which was involved in smuggling.

RULING

Yes. The Supreme Court denied the petition and affirmed the assailed CTA En Banc Decision. The Court found that the CTA’s conclusion that M/V Neptune Breeze and M/V Criston were the same vessel was supported by substantial evidence, including the PNP crime laboratory report confirming identical engine and generator serial numbers. The Court held that factual findings of the CTA, when supported by substantial evidence, are accorded respect and will not be disturbed on appeal. The Court also rejected El Greco’s due process claim, noting that as the agent of the vessel’s owner, it was bound by the proceedings conducted before the Legaspi District Collector where the vessel’s operator, Glucer Shipping, was duly notified but failed to appear. Furthermore, the Court ruled that the Manila District Collector’s release order did not become final as it was subject to automatic review by the BOC Commissioner under the Tariff and Customs Code. The forfeiture of the vessel was proper under Section 2530 of the Tariff and Customs Code for being used in the unlawful importation of articles.