GR L 11719; (April, 1959) (Digest)
G.R. No. L-11719; April 29, 1959
THE COMMISSIONER OF CUSTOMS, petitioner, vs. AUYONG HIAN (HONG WHUA HANG), respondent.
FACTS
On June 12, 1953, respondent Auyong Hian was issued Import Control Commission License No. 16679 under Republic Act No. 650 , authorizing him to import goods on a “no dollar remittance basis.” Relying on this license, he imported old newspapers in four shipments, the last of which arrived in Manila on November 7, 1954. This last shipment was seized by customs authorities for allegedly lacking the license required by Central Bank Circular No. 45. While the seizure case was pending before the Collector of Customs, the President of the Philippines, acting through the Cabinet in a meeting on January 26, 1955, cancelled License No. 16679. The sole ground for cancellation was that the license “illegally issued ‘in that no fixed date of expiration is stipulated.'” The Collector of Customs decreed the shipment’s forfeiture, a decision affirmed by the Commissioner of Customs. The Court of Tax Appeals reversed this, leading to the present appeal.
ISSUE
Was the cancellation of Import License No. 16679 by the President (through the Cabinet) justified?
RULING
No, the cancellation was not justified. While the President, acting through an instrumentality like the Cabinet, has the authority under Section 2 of Republic Act No. 650 to review and cancel licenses issued by the Import Control Commission, this power cannot be exercised arbitrarily. The cancellation must be founded on good ground and not be capricious. In this case, the license was cancelled after the importation had been completed and the importer had incurred expenses and obligations. The sole reason—the absence of a fixed expiration date—is insufficient to justify cancellation at this late stage, as it would cause gross inequity. The respondent had paid a license fee of P12,000 and the shipment was valued at P21,820. Jurisprudence holds that a license may not be arbitrarily revoked where the licensee has acted in good faith and incurred material expense. Therefore, the license was improperly cancelled, and the seizure of the shipment was unjustified. The decision of the Court of Tax Appeals is affirmed.