GR L 18773; (January, 1964) (Digest)
G.R. No. L-18773; January 31, 1964
CMS ESTATE, INC., petitioner, vs. COMMISSIONER OF CUSTOMS and COURT OF TAX APPEALS, respondents.
FACTS
CMS Estate, Inc. exported logs from Baganga, Davao, on which wharfage dues were assessed and collected by the Collector of Customs of Davao City. Believing the collection to be illegal due to the absence of a government wharf at Baganga, the petitioner sent a letter dated August 30, 1960, to the Collector, seeking a refund and requesting that future collections be stopped. This letter was forwarded to the Commissioner of Customs. The Commissioner, in a December 8, 1960 endorsement to the Davao Collector, ruled that the collection was lawful under Customs Administrative Order No. 236 and the Tariff and Customs Code. He directed the Collector to inform the petitioner accordingly and emphasized the mandatory requirement of filing a written protest against the Collector’s assessment within the reglementary period for any recovery of charges.
The Davao Collector transmitted this endorsement to CMS Estate on January 13, 1961. Instead of filing a formal protest with the Collector as instructed, CMS Estate filed a petition for review directly with the Court of Tax Appeals on February 22, 1961, seeking to overturn the Commissioner’s ruling. The Commissioner of Customs moved to dismiss this petition.
ISSUE
Whether the Court of Tax Appeals correctly dismissed the petition for review filed by CMS Estate for being premature.
RULING
Yes, the Court of Tax Appeals correctly dismissed the petition. The Supreme Court affirmed the dismissal, holding that the petitioner failed to exhaust the required administrative remedies before seeking judicial review. The legal logic is anchored on the explicit procedural hierarchy established by the Tariff and Customs Code. Under Sections 2308 to 2310, a party aggrieved by a Collector’s decision on duties or charges must first file a written protest with that Collector within 30 days. Only after the Collector rules on this protest may the party appeal that decision to the Commissioner of Customs under Section 1380 of the Revised Administrative Code.
In this case, CMS Estate never filed the requisite written protest with the Collector of Customs of Davao City against the original assessment and collection of the wharfage dues. The Commissioner’s December 8, 1960 communication was not a “decision” on a protest appeal but merely an opinion or directive issued to a subordinate official, clarifying the legality of the collection. Consequently, there was no final, appealable decision from the Commissioner of Customs on a matter that had properly progressed through the protest system. Judicial review by the Court of Tax Appeals under Republic Act No. 1125 is available only for final decisions of the Commissioner. Since the petitioner bypassed the mandatory preliminary step of a protest to the Collector, its direct recourse to the Court of Tax Appeals was premature and procedurally infirm. The dismissal was therefore proper.