G.R. No. L-10285; January 14, 1958
SAMPAGUITA SHOE AND SLIPPER FACTORY, petitioner, vs. COMMISSIONER OF CUSTOMS OF CEBU and COURT OF TAX APPEALS, respondents.

FACTS

Petitioner Sampaguita Shoe & Slipper Factory imported 10,000 square feet of patent leather. Upon examination, the Collector of Customs of Cebu declared the goods to be upper leather, not patent leather, and instituted seizure proceedings. Initially, on May 19, 1954, the Collector decided to release the goods upon payment of taxes. However, on June 1, 1954, the Collector amended his decision, declaring the goods confiscated. A copy of this amended decision was sent by registered mail and received by an employee of the petitioner on June 10, 1954. The petitioner’s manager allegedly did not see it until September 14, 1954, upon receipt of a demand letter from the Collector. The petitioner did not appeal this amended decision to the Commissioner of Customs within the 15-day period. Instead, after its petition to set aside the amended decision was denied by the Commissioner via a 2nd Indorsement dated December 3, 1954 (received by petitioner on December 29, 1954), the petitioner filed a petition for review directly with the Court of Tax Appeals on January 28, 1955. The Court of Tax Appeals dismissed the petition for lack of jurisdiction due to the petitioner’s failure to exhaust administrative remedies by not appealing first to the Commissioner of Customs.

ISSUE

Whether the Court of Tax Appeals correctly dismissed the petition for review due to the petitioner’s failure to first appeal the Collector of Customs’ decision to the Commissioner of Customs, thereby not exhausting administrative remedies.

RULING

Yes, the Court of Tax Appeals correctly dismissed the petition. The Supreme Court affirmed the resolution of the Court of Tax Appeals. The Court held that under Section 1380 of the Revised Administrative Code, a party aggrieved by a decision of the Collector of Customs must appeal to the Commissioner of Customs within 15 days. The petitioner’s failure to do so rendered the Collector’s decision final and executory. While Section 11 of Republic Act No. 1125 mentions appeals from a “Collector of Customs,” Section 7 of the same Act confers exclusive appellate jurisdiction on the Court of Tax Appeals to review “Decisions of the Commissioner of Customs.” The doctrine of exhaustion of administrative remedies requires that the preliminary administrative sifting process (appeal to the Commissioner) be completed before resorting to the courts. Since the petitioner did not appeal to the Commissioner, it could not subsequently appeal to the Court of Tax Appeals. Furthermore, even if the Commissioner’s 2nd Indorsement were treated as a decision, the petition to the Court of Tax Appeals was filed beyond the 30-day period prescribed by law.