BANKING MORALES – 02
Cancio v Court of Tax Appeals (1987) CASE SUMMARY Customs seized Cancio’s undeclared undeclared US dollars before she could begin her trip to the US for heart treatment. The Court of Tax Appeals armed the seizure, but the SC reversed it. As a foreign currenc depositor !ith "C#$, the %oreign Currenc &eposit Act allo!s Cancio to bring foreign currenc out of the countr even !ithout declaring it. acts •
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Cancio was clearing through the Manila International Airort!s "re#Boar$ing area on a %ight to &ong Kong' She $i$ not $eclare that she was carr(ing cash at the airort!s Custo)s area' *he airort!s airort!s re#+oar$ing re#+oar$ing $etector $etector rang an alar) an$ an$ it was $isco,ere$ $isco,ere$ that she was was carr(ing carr(ing an un$eclare$ un$eclare$ a)ount o- )one(. /02100'00 in cash1 /300'00 in tra,ellers chec4s1 an$ "500'00' the )one( was hi$$en insi$e 2 large chocolate +o6es1 which were securel( o wrae$ in -oil#+ac4 aer' *he Co))issioner Co))issioner o- Custo)s or$ere$ or$ere$ the the sei7ure sei7ure o- the )one( +ecause +ecause Cancio Cancio -aile$ to resent the re8uisite Central Ban4 authori7ation allowing her to +ring the )one( out o- the "hiliines' 9uring the sei7ure rocee$ings1 rocee$ings1 Cancio resente$ a hotoco( o- her +an4+oo4 -or -oreign currenc( $eosit with "CIB an$ allege$ that she was a -oreign currenc( $eositor ursuant to the :oreign Currenc( 9eosit o Act ;RA 3<23=1 as i)le)ente$ +( Central Ban4 Circular ><>' she ha$ with$rawn the cash in rearation -or her tri to the ?S where she o woul$ get )e$ical treat)ent -or her heart the cash was conceale$ in the chocolate +o6es -or securit( reasons o *he C*A C*A a@r)e$ a@r)e$ the -or-eiture -or-eiture o- Cancio!s Cancio!s )one(' )one('
!ssue "as t#e CTA CTA $ron% to up#ol& t#e forfeiture of Cancio's one* YES +el&,Ratio *he general rule ro,i$e$ ro,i$e$ +( Central Central Ban4 Circulars Circulars 235 an$ 5>< is that that no erson )a( ta4e -oreign currenc( out o- the "hiliines without Central Ban4 authori7ation' CB Circ 235. >' No erson shall ta4e out or e6ort -ro) the "hiliines -oreign o currenc( or an( other -oreign e6change e6cet as otherwise authori7e$ +( the Central Ban4' o CB Circ 5><. Sec' >' ?nless secicall( authori7e$ authori7e$ +( the Central Ban4 or allowe$ un$er e6isting international agree)ents or Central Ban4 regulations1 no erson shall ta4e or trans)it or atte)t to ta4e or trans)it -oreign e6change1 in an( -or) out o- the "hiliines onl(1 through other ersons1 through the )ails1 or through international carriers' *he ro,isions o- this Section shall not al( to tourists an$ non#resi$ent te)orar( ,isitors who are ta4ing or sen$ing out o- the "hiliines their own -oreign e6change +rought in +( the)' &owe,er1 Cancio -alls un$er the e6cetion +ecause she is a -oreign currenc( $eositor' *he :oreign :oreign Currenc( Currenc( 9eosit Act Act loosens the restriction restriction on trans-era+ilit( trans-era+ilit( o- -oreign -oreign currenc( -or those who are -oreign currenc( $eositors' *he onl( re8uire)ent +e-ore •
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a -oreign currenc( $eositor )a( ta4e -oreign currenc( out o- the "hiliines is that an( restriction -ro) the contract +etween the $eositor an$ the +an4 +e -ollowe$' SEC' 5' Dith$rawa+ilit( an$ trans-era+ilit( o- $eosits' *here shall +e no o restriction on the with$rawal +( the $eositor o- his $eosit or on the trans-era+ilit( o- the sa)e a+roa$ e6cet those arising -ro) the contract +etween the $eositor an$ the +an4' *&E C*A ARG?ES that this ro,ision onl( gi,es the -oreign currenc( $eositor -ree$o) o- with$rawal1 not -ree$o) o- trans-era+ilit( a+roa$' *his is wrong1 +ecause o- a Circular Letter issue$ +( the Central Ban4 o re8uiring +an4s to a$,ise their -oreign currenc( $eositors to carr( the certicate o- with$rawal when the( tra,el' It is thus the $ut( o- the +an41 not the $eositor1 to re)in$ the latter to +ring their certicates o- with$rawal whene,er the( tra,el with -oreign currenc(' Dhile Cancio $i$ not resent a certicate o- with$rawal -or -ailure o- "CIB to o a$,ise her to +ring such $ocu)ent1 the SC consi$ere$ the resentation o- her -oreign currenc( +an4 +oo4 in e,i$ence as su+stantial co)liance' *he un$erl(ing o+Fecti,e o- the :oreign Currenc( 9eosit Act is to attract an$ in,ite the $eosit o- -oreign currencies which are acceta+le as art o- the international reser,e in $ul( authori7e$ +an4s in or$er that the( )a( +e ut into the strea) o- the +an4ing s(ste)' It woul$ $e-eat the ,er( urose o- the law to lace un$ue restrictions on the trans-era+ilit( o- such -un$s' *he counter,ailing eect woul$ +e to $iscourage rosecti,e -oreign currenc( $eositors to the $etri)ent o- the +an4ing s(ste)'
$iane agustin
