G.R. No. 178759 ; August 11, 2008
CHEVRON PHILIPPINES, INC., petitioner, vs. COMMISSIONER OF THE BUREAU OF CUSTOMS, respondent.

FACTS

Petitioner Chevron Philippines, Inc. imported various shipments of crude oil and petroleum products in March and April 1996. The shipments were unloaded upon arrival, and Import Entry Declarations (IEDs) were filed, with 90% of the estimated duties paid. The final Import Entry and Internal Revenue Declarations (IEIRDs), however, were filed between May 10 and June 21, 1996, which was more than 30 days from the vessels’ dates of entry. The applicable duty rate at the time of importation was 10%, but petitioner was assessed and paid at the 3% rate under the newly enacted RA 8180, which took effect on April 16, 1996. In 1999, an investigation was initiated based on an anonymous letter alleging fraud. The Bureau of Customs (BOC) subsequently demanded deficiency duties, arguing the 10% rate should apply and that the goods were deemed abandoned due to late filing. Petitioner contested the assessment, raising the defense of prescription under the Tariff and Customs Code.

ISSUE

The primary issue is whether petitioner’s importations were deemed abandoned under the Tariff and Customs Code for failure to file the requisite entry within the 30-day non-extendible period, thereby making the assessment for deficiency duties valid and not subject to prescription.

RULING

The Supreme Court ruled in favor of the respondent Commissioner of Customs. The Court held that the filing of the IEIRD constitutes the “entry” of imported articles as required by Section 1301 of the Tariff and Customs Code. Since petitioner filed its IEIRDs beyond the 30-day non-extendible period from the date of discharge of the last package from the vessel, the importations were not seasonably entered. Consequently, under Sections 1801 and 1802 of the Code, the shipments were deemed abandoned in favor of the government. This abandonment is automatic and occurs by operation of law, requiring no prior notice or hearing. The Court further ruled that the defense of prescription under Section 1603 of the Code does not apply because the period for filing an action to collect unpaid duties only begins to run from the date of final payment. Here, there was no valid entry and thus no final payment, as the goods were already deemed abandoned. Therefore, the government’s right to collect the deficiency duties, computed at the 10% rate prevailing at the time of entry, had not prescribed. The assessment was upheld.