G.R. No. L-9836




Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. L-9836 November 18, 1959 COMMISSIONER OF CUSTOMS, petitioner, vs. FRANCISCO PASCUAL, respondent. Office of the Solicitor General Amrosio Padilla for petitioner. Clemente N. Soriano for respondent. GUTIERREZ DAVID, J.: This case involves an importation of the respondent Francisco Pascual in 1954 of 301 cartons of confectionery on a "no-dollar" remittance basis, which was declared forfeited in favor of the Government by the Manila Collector of Customs for lack of a release certificate as required by Circular Nos. 44 and 45 issued by the Central Bank of the Philippines. As the shipment was previously released upon the filing of a surety bond, respondent Pascual was ordered to pay in cash the sum of P6,925.00, the amount covered by the bond. The decree of forfeiture was affirmed by the Commissioner of Customs, but on appeal to the court of Tax Appeals, that court nullified the decree and ordered the surety bond filed by the respondent cancelled on the ground that the Central Bank under its Charter and after the expiration of the Import Control Law (R.A. 650) on June 30, 1953 had no power to regulate "no-dollar" imports. Contending that the Central Bank has such power, the Commissioner of Customs filed the present petition for review. The only question for determination is whether or not the Central Bank of the Philippines has the power to issue Circular Nos. 44 and 45 in so far as they regulate imports which do not involve the remittance of dollars or foreign exchange. In the case of Francisco Pascual vs. Commissioner of Customs (105 Phil., 1039; 56 Off. Gaz., [47] 7169), the power of the Monetary Board to issue the aforementioned circulars and the validity thereof have been upheld. Speaking through Mr. Justice Padilla, this court there said: . . . Even granting that the importation's in question do not require an immediate sale of foreign exchange, their importation into the Philippines from another country will ultimately require the sale of such exchange. The currency of one country is not legal tender in another. To pay for imports, traders have to avail themselves of foreign exchange, which is the conversion of an amount of money or currency of one country into an equivalent amount of money or currency of another. Every import of goods or merchandise requires an immediate or future demand for foreign exchange. Section 74. Republic Act No. 265, authorizes the Monetary Board, with the approval of the President, to temporarily suspend or restrict sales of exchange and to subject all transactions in gold and foreign exchange crisis in order to protect the international reserve and to give the Monetary Board and the Government time in which to take constructive measures to combat such a crisis. Circular No. 44, prohibiting the release by the Commissioner of Customs of any item of import without the presentation of a release certificate issued by the Central Bank or any authorized agent bank in a form prescribed by the Monetary Board, and Circular No. 45, requiring any person or entity who intends to import or receive goods from any foreign country for which no foreign exchange is required or will be required of the banks, to apply for a license from the Monetary Board to authorize such import, are measures taken to check the unregulated flow of foreign exchange from the country and are within the powers of the Monetary Board. Appellants contention is that congress has not authorized the Central Bank to issue governing imports that do not require the sale of foreign exchange, because according to him, it would not have enacted into law Republic Act No. 1410. The contention assumes that the importation do not require the sale foreign exchange, a fact which he failed to establish. Appellant contends that assuming that the importation's in question require the sale of foreign exchange in violation of Circular No. 44, yet they may not be forfeited under the said Circular because it does not expressly provide for the penalty of forfeiture. Circular No. 45 in part requires any person or entity who intends to import or receive goods from any foreign country for which no foreign exchange is required or will be required of the banks, to apply for a license from the Monetary Board to authorize such import. Circular No. 44 requires the presentation of release certificates issued by the Central Bank or any authorized agent bank in a form prescribed by the Monetary Board for the release of import by the Bureau of Customs. Section 1363 (f) of the Revised Administrative Code provides: Vessels, cargo, merchandise, and other subjects and things shall, under the conditions hereinbelow specified, be subject to forfeiture: (f) Any merchandise of prohibited importation or exportation, the importation or exportation of which is effected or attempted contrary to law, and all other merchandise which, in the opinion of the collector, have been used, are or were intended to be used as instrument in the importation or exportation of the former. As already stated, Circulars Nos. 44 and 45 were issued by the Monetary Board within the scope of its powers. They were published in the Official Gazette in June 1953. Appellant failed to present to the Commissioner of Customs release certificates issued by the Central Bank or its duly authorized agent banks for the importation's in question. The Commissioner of Customs may, therefore, seize them and order their forfeiture under the aforequoted provisions of the Revised Administrative Code. It is true that neither of the Circulars provide of the penalty or forfeiture. But since the importation's in question were made without the necessary import license issued by the Monetary Board pursuant to circular 45 and the release certificates issued by the Central Bank or its authorized agent bank in the prescribed form pursuant to Circular 44, they fall within the class of "merchandise or prohibited importation" or merchandise "the importation . . . of which is effected . . . contrary to law that the Commissioner of customs may seize and order forfeited. To sustain the appellant's theory of the case would render nugatory the aim and purpose of the law when it authorizes the Central Bank to temporarily suspend or restrict the sale of foreign exchange to licensing during an exchange crisis in order to protect the international reserve and to give the Monetary board and the Government time in which to take constructive measures to combat such a crisis. The foregoing view was reiterated in Acting Commissioner of Customs vs. Estanislao Leuterio (G.R. No. L-9142, prom. October 17, 1959) which is on all fours with the present case. Wherefore, the decision of the Court of Tax Appeals complained of its reversed, and the decision of the Commissioner of customs declaring the forfeiture of the importation in question in favor of the Government is affirmed, with costs against respondent Pascual. Paras, C.J., Bengzon, Padilla, Montemayor, Bautista Angelo, Labrador, Reyes, J.B.L., Endencia, and Barrera, JJ., concur. 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