G.R. No. L-9217; March 30, 1914
THE UNITED STATES, plaintiff-appellee, vs. GREGORIO MARTINEZ, defendant-appellant.

FACTS:
Gregorio Martinez was charged with violating Section 66 of Act No. 1189 (the Internal Revenue Law) for allegedly engaging in the wholesale traffic of liquors without having paid the required license tax. The charge stemmed from a search by the Provincial Treasurer of Mindoro of Martinez’s storeroom in Pola, where three demijohns of vino anisado and a case of gin were found. Martinez claimed these belonged to Rufina Maravilla, a resident who held a retail license for selling vinos. He stated he had purchased the items from a licensed dealer in Bauan, Batangas, at Maravilla’s request, and they were stored at his house because the boat’s master could not unload them at Maravilla’s residence due to the falling tide. The invoice for the purchase was issued in Maravilla’s name. The prosecution alleged that Martinez had not delivered the goods because Maravilla had not yet paid him with hemp, as per their agreementan assertion denied by both Martinez and Maravilla. The Court of First Instance of Mindoro convicted Martinez and sentenced him to pay a fine and the license tax due.

ISSUE:
Whether Gregorio Martinez, by procuring the liquors for Rufina Maravilla under the circumstances described, engaged in the wholesale traffic of liquors without a license in violation of Section 66 of Act No. 1189.

RULING:
No. The Supreme Court reversed the judgment of conviction and acquitted Gregorio Martinez.

The Court held that to be considered a dealer in wines and liquors under the Internal Revenue Law, a person must sell or offer for sale such spirits on his own account or on commission. The evidence failed to establish that Martinez sold the liquors on his own account or acted as a commission agent. The liquors were unquestionably owned by Rufina Maravilla, who held a valid retail license, and the purchase invoice was in her name. Martinez acted merely as an intermediary at her request. The alleged agreement for payment in hemp was not sufficiently proven, and even if it existed, there was no evidence that Martinez derived or intended to derive profit from the transaction. The presence of the goods in his storeroom was adequately explained by the logistical problem with the boat’s delivery. Therefore, his actions did not constitute the offense of engaging in wholesale traffic without a license. The Court found him not guilty of the violation charged. Costs were adjudged de oficio.