The Court of Tax Appeals (CTA) has denied a petition which sought the release of a seized and forfeited vessel involved in the illegal importations of rice and cigarettes in 2021.

Junked by the CTA was the petition of Hai Long Shipbuilding and Lighterage, Inc. on the release of its vessel which was subject of a warrant of seizure and detention (WSD) issued by Bureau of Customs (BOC) on Feb. 24, 2021.

The WSD was issued by lawyer William B. Balayo, acting district collector of the Port of Limay in Bataan, on the cargo vessel “LCT Yellow River.”

The seizure and forfeiture of the vessel in favor of the government was ordered for violation of Section 113(k) of the Customs Modernization and Tariff Act (CMTA) for transporting illegally imported rice and cigarettes.

In its petition filed on Oct. 11, 2021, Hai Long told the CTA that its vessel is just a common carrier and it has no knowledge or participation in the unlawful act of transporting illegally imported goods.

The shipping firm also alleged that it only knew the cargo will be for rice but never knew that these were smuggled.

The CTA ruled that the seizure and forfeiture of the cargo vessel is valid.

However, the CTA found that the forfeiture of LCT Yellow River is valid.

"The key provisions of the CMTA clearly provides that the mere carrying of smuggled goods on board any vehicle may cause the outright seizure of the latter and subject the same to forfeiture, save for some exceptions," the CTA said.

It also said that Hai Long failed to sufficiently prove that it met the conditions to be exempt from forfeiture.

The CTA ruled: "While it is stipulated and admitted by the parties that the subject vessel is a common carrier engaged in coastwise trading, and that it has been chartered by Accufast, petitioner mainly claims that the charter is only limited to the use of the vessel alone, and not of the crew of petitioner. It also claims no knowledge nor any participation in the unlawful activity. We disagree."

Citing a previous Supreme Court decision, the CTA said that when a common carrier has been chartered or leased, no matter what label it may have been designated by the parties, the mere fact that it is chartered excludes the same from claiming exemption from forfeiture.

The CTA ruled: “The Court finds that the evidence and testimony offered by petitioner are self-serving, and insufficient to establish that the owners or the agents of the vessel did not have knowledge that it will be used for the commission of unlawful acts. It is weak on its own to merit the overturning of forfeiture that was already ruled upon based on substantial evidence.”

The 16-page decision was written by Associate Justice Henry S. Angeles with the concurrence of Associate Justice Catherine T. Manahan.