By Joel R. San Juan & Elijah Felice Rosales
A week after Mighty Corp. owner Alexander Wongchuking presented himself to the Department of Justice (DOJ), President Duterte has instructed Chief Presidential Legal Counsel Salvador S. Panelo to file charges against the businessman.
This developed as the Bureau of Customs (BOC) issued a preventive suspension on Tuesday against Mighty Corp., which effectively stopped the firm from importing raw materials necessary for the production of its tobacco products.
The preventive suspension was issued despite the 20-day temporary restraining order (TRO) earlier issued by the Regional Trial Court in Manila City enjoining the agency from further conducting raids on the warehouses of Mighty Corp.
“Indeed, a 20-day TRO has been recently issued against the Bureau on this matter. However, it only enjoins the bureau from further acts of raids and inspection of Mighty Corp’.s warehouses. Nevertheless, be assured this office will not commit contumacious acts, but will, at all times, be respectful of the said court order,” the BOC said in its order.
Face the raps
In an interview with Malacañang reporters on Tuesday, Panelo said President Duterte has given specific instructions to bring Wongchuking to court. “I’ve been instructed [by the President] to study and prepare the case against Mighty cigarettes,” he said.
Panelo added he is now coordinating with Internal Revenue Commissioner Caesar R. Dulay regarding the matter. The Chief Legal Counsel believes the BIR had already prepared cases against Mighty Corp. even before the discovery of the fake tax stamps, but this was ignored by the previous administration.
Asked about what charges will Wongchuking face in court, Panelo said it could either be tax evasion or economic sabotage. “If it reaches P1 billion of amount, then it is economic sabotage,” he pointed out.
Panelo also clarified the pronouncement of Duterte late last week that Wongchuking can just pay P3 billion for a compromise settlement, which the administration would use for the establishment and renovation of a hospital in Manila and two other similar structures in conflict-ridden areas of Basilan and Sulu provinces in Mindanao.
“Under the law, civil liability can be in [the form of] settlement,” Panelo said. However, he made it clear that the government is, at the same time, looking to hold Mighty Corp. owner liable for criminal charges.
“[MC] is supposed to pay some taxes and they have avoided that [obligation], so we have to prosecute them for that. With respect to the discovery of the fake-tax stamps, then that’s another case,” Panelo stressed.
Documentation
The head lawyer of the President said he is presently waiting for the documents to be brought to his office. Once received, he vowed to begin his study of the case so he, in coordination with the DOJ and the BIR, can already press charges against Wongchuking.
Ebreo added: “At this point the DepCom [deputy commissioner] for RCMG [Revenue Collection Monitoring Group] signed the preventive suspension against Mighty Corp. based on the initial study of the case, and we found probable cause for the issuance of preventive suspension.”
The preventive suspension only covers incoming shipments, such as tobacco leaf and acetate tow that have not been lodged in the BOC system. The order will take effect indefinitely, or until such time that the company has proven that it did not commit the said offenses.
Mighty Corp. would also be given the right to file a motion for reconsideration.
The BOC cited its recent raids of Mighty Corp’s. warehouses in Zamboanga City, General Santos City and San Simon, Pampanga, yielding more than P2.18 billion worth of assorted counterfeit cigarettes as the main reason for ordering its preventive suspension. This is one of the first actions taken by the BOC’s newly formed Batas Action Team Against Smuggling (Batas), where Ebreo sits as the executive director.
Ebreo explained that Mighty Corp’s. suspension is necessary for the protection of government interest in the light of the bureau’s mandate under Section 202 (d) of the Customs Modernization and Tariff Act (CMTA) to protect and suppress smuggling and other Customs fraud.
“Said suspension will also enjoin and restrain Mighty Corp. from further commission of acts complained of, which could be detrimental to government interest, particularly during the pendency of the instant case,” the BOC’s order read.
On the other hand, this will provide an unhampered venue for the ensuing administrative investigation, free from any collateral issues and concerns,” it added.
The BOC’s Accounts Management Office (AMO) reported that “there is a necessity for further and thorough investigation on the allegation of abuse of its customs bonded warehousing privileges that was the basis by then-Customs Commissioner John Sevilla’s decision to immediately suspend its [Mighty Corp.’s] customs bonded warehousing license.”
The BOC further alleged that Mighty Corp. violated the conditions on the uses ofthe customs bonded warehouse as a mode of importation in bringing in its raw materials.
The Fiscal Intelligence Unit-Department of Finance also reportedly discovered undervaluation amounting to P163,117,995, “for the withdrawal of raw materials for
local consumption, the correct value thereof must be determined for the payment of duties and taxes,” Ebreo said.
BOC-Batas has also received a copy of the warrant of seizure and detention issued by BOC Port of Zamboanga District Collector Helleck Valdez against 400 master cases of alleged assorted counterfeit cigarettes that has an estimated value of P13.5 million.