G.R. No. L-24011 October 24, 1970
MANUEL BASTIDA, petitioner, vs. THE ACTING COMMISSIONER OF CUSTOMS and THE COURT OF TAX APPEALS, respondents.

FACTS

On November 2, 1956, customs examiner Benigno Layug, examining cargo for shipment at the Manila International Airport, found a package consigned by petitioner Manuel Bastida to a priest in Rome. The package was declared to contain only two Minifons (wire recorders). Upon inspection, two cardboard boxes were found, each containing a Minifon. Concealed at the bottom of one box, under cardboard, were various checks, money orders, and traveler’s checks, all payable in US dollars, totaling $13,780. In the other box, similarly concealed, were two money orders totaling $3,149.50 and several US dollar bills totaling P630. The Minifons were covered by an Export Control Committee permit and a Central Bank export license, but the checks, money orders, and dollar bills were not covered by any Central Bank license. The Customs authorities seized all items for alleged violation of Section 1363(f) and (m) sub-paragraphs 3 and 4 of the Revised Administrative Code and Central Bank Circulars 20 and 42. The Collector of Customs decreed forfeiture of all items to the government. The Acting Commissioner of Customs affirmed this decision. Pending appeal, the Central Bank issued Circular 133 on January 21, 1962, permitting the purchase and export of US dollars without prior specific licensing and repealing inconsistent circulars. The Court of Tax Appeals affirmed the forfeiture on November 25, 1964.

ISSUE

1. Are the checks, money orders, and US dollar bills “merchandise” within the purview of Section 1363 of the Revised Administrative Code?
2. Did the petitioner violate Central Bank Circular 20 as implemented by Circular 42?
3. Assuming the items are “merchandise,” are they still subject to forfeiture in view of the repeal of Circulars 20 and 42 by Circular 133?

RULING

1. Yes. The checks, money orders, and US dollar bills are “merchandise” as defined in Section 1419 of the Revised Administrative Code, which includes “anything that may be made the subject of importation or exportation.” US dollar bills, having ceased to be legal tender in the Philippines, are considered merchandise. Checks and money orders, as negotiable instruments, may be bought and sold like commodities and are thus included within the term.
2. Yes. The attempted exportation of the checks, money orders, and dollar bills without the requisite prior license from the Central Bank constituted a violation of Circulars 20 and 42. These instruments directly involved foreign exchange, whose flow the Central Bank was empowered to regulate.
3. Yes. The forfeiture remains valid. The repeal of Circulars 20 and 42 by Circular 133 did not abate the forfeiture proceedings because such proceedings are civil (in rem) actions against the merchandise, not criminal (in personam) actions against the offender. The repeal cannot be given retroactive effect to legitimize the prior illegal act. Furthermore, the forfeiture is also justified under Section 1363(m), sub-paragraphs 3 and 4 of the Revised Administrative Code, as the petitioner made a false declaration in his export license application by omitting the concealed items. The Minifons are also subject to forfeiture as they were used as the means to attempt the illegal export.
The decision of the Court of Tax Appeals is affirmed.