A vessel is not subject to forfeiture if it is engaged as a duly authorized common carrier and as such carrier it is not chartered or leased.

M/T Jacob 1, towing barge “Cheryl Ann”, containing used oil from the Republic of Palau, entered the port of Surigao. Both vessels were detained by the Philippine Coast Guard upon an information that said tugboat/barge contained prohibited cargoes (used oil). In a subsequent endorsements by the Undersecretary of Finance and the Commissioner of Customs, the M/T Jacob 1 was ordered released while Cheryl Ann was ordered forfeited in favor of the government. When the case was elevated to the Court of Tax Appeals, Cheryl Ann was also ordered to be immediately released. According to the Court, the barge Cheryl Ann is a mere accessory of the principal M/T Jacob 1. This being the case, the ruling accorded MT Jacob 1 should be similarly accorded to barge Cheryl Ann. The barge Cheryl Ann, while physically tied up with M/T Jacob 1, is subject to the latter’s movement and direction, hence, cannot control its own destination. When M/T Jacob 1 was ordered released, it is all the more the accessory barge should also be released, as it was merely following the principal tugboat. Also, pursuant to Section 2530 of the Tariff and Customs Code of the Philippines, the mere carrying or holding on board of smuggled articles shall subject the vessel to forfeiture. However, the vessel is not subject to forfeiture if it is engaged as duly authorized common carrier and as such carrier it is not chartered or leased. The fact established is that the barge is a common carrier. The presence of the charter agreement did not concert the vessel into a private carrier. (The Commissioner of Customs and the Undersecretary of Finance vs. Gold Mark Sea Carriers, Inc., CTA EB No. 825, December 24, 2012)