The Court of Tax Appeals (CTA) has denied the petition filed by members of the Philippine Association of Meat Processors, Inc. (PAMPI) which challenged the implementation by the Bureau of Customs (BOC) of the increased tariff on the importation of mechanically deboned meat (MDM).
Denied was the petition filed by Fabrossi Food Group, Inc., Enzed Trade, Inc., Asilo Meatshop, D.E.A. Meat Trading and Import Corp., Food Sphere, Inc., Virginia Food, Inc. which are all members of the PAMPI and engaged in the importation of MDM.
The firms' plea for a temporary restraining order (TRO) was denied by the CTA's first division which eventually ruled in favor of the BOC. They elevated the case to the CTA as a full court. Their petition was denied.
The issue stemmed from Republic Act No. 11203, Rice Tariffication Law, which took effect on March 5, 2019. The BOC issued a Customs Memorandum Circular (CMC) No. 131-2019 on May 23, 2019 providing for the application of the higher Most Favored Nation (MFN) rate (40 percent for MDM).
The district collector of the Manila International Container Port then ordered the petitioners to pay additional duties amounting to P230,387,073, which reflected the uncollected tariff differential of 35 percent for MDM for the period of March 5, 2019 to May 16, 2019.
The petitioners filed a petition before the CTA on July 11, 2019 praying that it declare the subject CMC null and void, as well as direct the BOC to return the overpayments made by the importers.
They also sought a TRO and Writ of Preliminary Injunction enjoining the BOC from enforcing its demand for the payment of differential rate of 35 percent and imposing the corresponding surcharges and interests.
However, this was denied in a decision dated Sept. 22, 2022. Aggrieved, they elevated their case to the CTA as full court on March 24, 2023 and sought the reversal of the earlier decision made by the court's first division.
The petitioners claimed that their right to due process was violated as the CMC was suddenly implemented without prior notice. They contended that publication is an essential requirement of due process, and the BOC failed to strictly comply with it.
However, the CTA as a full court found their petition bereft of merit. "After an assiduous review of the records and the parties' arguments, the Court finds no cogent reason to reverse or modify the assailed decision and resolution (of the first division)," the CTA said.
Contrary to their claims, the CTA stressed that the CMC need not be published, as it is "an interpretative rule that does not require publication prior to its effectivity."
"There is no basis to declare CMC No. 131-2019 and the resulting demand letters null and void. This Court finds no reason to reverse or modify the decision of the CTA First Division," it ruled.
The 19-page decision was written by Associate Justice Corazon G. Ferrer-Flores with the concurrence of Presiding Justice Roman G. Del Rosario and Associate Justices Ma. Belen M. Ringpis-Liban, Catherine T. Manahan, Jean Marie A. Bacorro-Villena, Maria Rowena Modesto-San Pedro, Marian Ivy F. Reyes-Fajardo, and Lanee S. Cui-David.