Commissioner of Customs v. Makasiar
REITERATIONFacts
1. The Antecedents: The underlying dispute concerns the seizure of six tanks of Scotch Whisky, 417 cartons of "Johnnie Walker Black Label Whisky," 109 empty bottles, and 900-2044 empty cartons. These items were seized on December 8, 1978, by a composite team from the Ministry of Finance Bureau of Investigation and Intelligence, the Bureau of Customs, and the Integrated National Police, pursuant to search and seizure warrants issued by the Court of First Instance (CFI) of Manila in Criminal Cases Nos. 8602 and 8603. The warrants were for alleged violations of Republic Act No. 3720 (food, drugs, and cosmetics) and Article 188 of the Revised Penal Code (trademark infringement), and the items were found at the premises of Hercules Bottling Co., Inc. The seized articles were intended for use in counterfeiting or imitating Johnnie Walker Scotch Whisky. 2. Procedural History: Following the seizure, the Collector of Customs for the Port of Manila issued a warrant of seizure and detention on January 2, 1979, initiating seizure and forfeiture proceedings for alleged violation of Section 2530(f) of the Tariff and Customs Code. The CFI-MANILA, on January 29, 1979, authorized the transfer of the seized articles to the customs warehouse under specific conditions, including safekeeping and the issuance of receipts. The validity of the CFI-MANILA's search warrants was upheld by the Court of Appeals and subsequently by the Supreme Court in G.R. No. 55061. The Bureau of Customs resumed its seizure and forfeiture proceedings. The private respondent, The Distillers Co. Ltd. of England, objected to the continuation of these proceedings, fearing they would jeopardize the preliminary investigation of criminal cases. When the Collector of Customs ignored these objections, the private respondent filed a petition for prohibition with preliminary injunction and/or temporary restraining order in the Regional Trial Court (RTC), Branch 35, Manila, which issued a temporary restraining order and later a writ of preliminary injunction. The RTC judge ruled that the Collector of Customs acted in excess of jurisdiction. The Commissioner of Customs, represented by the Solicitor General, then filed the instant petition for review. 3. The Petition: The Commissioner of Customs filed this petition for review under Rule 45 of the Rules of Court, seeking to reverse the decision of the RTC judge. The petitioner argues that the RTC judge erred in issuing the injunction and in taking cognizance of the case, asserting that the Regional Trial Courts lack jurisdiction to interfere with the exclusive authority of the Bureau of Customs in seizure and forfeiture proceedings. The petitioner contends that such matters are appealable only to the Court of Tax Appeals and subsequently to the Supreme Court. The private respondent, however, argued that the RTC judge had jurisdiction to enjoin the Bureau of Customs because the goods were already in custodia legis of the CFI-MANILA, and the prohibition was sought to preserve the goods for the criminal cases, not to claim ownership. The Supreme Court, in its petition, considered the assigned errors and the arguments presented, ultimately finding merit in the Commissioner's petition.
Issue(s)
Whether the Regional Trial Court has jurisdiction to enjoin the Bureau of Customs from continuing with its seizure and forfeiture proceedings over goods earlier seized by virtue of search warrants issued by the CFI-MANILA. Whether the Collector of Customs was deprived of jurisdiction to issue the warrant of seizure and detention and to institute seizure and forfeiture proceedings simply because the subject goods were first taken in custodia legis.
Ruling
The decision of the respondent judge dated July 20, 1987, is REVERSED. The seizure and forfeiture proceedings involving the goods in question before the Bureau of Customs may proceed subject to the pronouncements relative to the setting aside of so much of the goods as may be required for evidentiary purposes.
Ratio Decidendi
On the jurisdiction of the Regional Trial Court to enjoin Bureau of Customs proceedings: The Supreme Court held that Regional Trial Courts are devoid of any competence to pass upon the validity or regularity of seizure and forfeiture proceedings conducted in the Bureau of Customs, and to enjoin or otherwise interfere with these proceedings. The Collector of Customs, sitting in seizure and forfeiture proceedings, has exclusive jurisdiction to hear and determine all questions touching on the seizure and forfeiture of dutiable goods. The Supreme Court reiterated that law and settled jurisprudence clearly deprive the regional trial courts of jurisdiction to enjoin the Collector of Customs from exercising his exclusive authority to order seizure and forfeiture proceedings over imported goods. The Court cited numerous cases, including General Travel Service v. David and Collector of Customs v. Torres, to support this established rule. The policy behind this rule is to avoid unnecessary hindrance to the government's drive to prevent smuggling and other frauds upon customs, and to ensure the effective and efficient collection of import and export duties, which are vital to public revenue. On whether the Collector of Customs was deprived of jurisdiction: The Supreme Court found no legal basis for the respondent judge's conclusion that the Collector of Customs was deprived of jurisdiction. While the subject goods were indeed in custodia legis by virtue of the CFI-MANILA's search and seizure warrants, this fact did not divest the CFI-MANILA of its jurisdiction nor did it mean that the Collector of Customs could not exercise his authority. The CFI-MANILA, in fact, authorized the transfer and delivery of the seized articles to the Bureau of Customs warehouse, thereby entrusting the Bureau with actual possession and control. This actual possession and control secured the Collector of Customs' jurisdiction for the purpose of instituting seizure and forfeiture proceedings to determine the legality of the importation, consistent with the principle that the basic operative fact for in rem proceedings is the actual or constructive possession of the res by the empowered tribunal. Therefore, no legal infirmity attended the seizure and forfeiture proceedings initiated by the Collector of Customs.
Main Doctrine
Regional Trial Courts are devoid of competence to pass upon the validity or regularity of seizure and forfeiture proceedings conducted in the Bureau of Customs, and to enjoin or otherwise interfere with these proceedings, as the Collector of Customs sitting in such proceedings has exclusive jurisdiction. However, the CFI-Manila, having issued search warrants and thus having the subject goods in custodia legis, authorized the transfer of the goods to the Bureau of Customs, thereby entrusting the latter with actual possession and control for seizure and forfeiture proceedings, without divesting the CFI-Manila of its jurisdiction or interfering with its processes.