A-94121, MAY 27, 1938, 17 COMP. GEN. 1012

A-94121: May 27, 1938

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CUSTOMS SERVICE - DUTIES - REFUNDS - ENTRIES SUBSEQUENTLY DAMAGED BY FLOOD WHERE SEED IN ITS CONDITION AS IMPORTED WAS FOUND TO MEET THE REQUIREMENTS OF THE FEDERAL SEED ACT. WAS IN THE CUSTODY OF THE CONSIGNEE UNDER REDELIVERY BOND AT THE TIME IT WAS RENDERED WORTHLESS BY A FLOOD. THERE IS NO AUTHORITY EITHER UNDER SECTION 563 OF THE TARIFF ACT OF 1930. NOR ARE THERE PRESENT SUCH ELEMENTS OF LEGAL LIABILITY OR EQUITY AS WOULD WARRANT REPORTING THE CLAIM TO THE CONGRESS FOR RELIEF UNDER THE ACT OF APRIL 10. AS FOLLOWS: WE ARE ENCLOSING ORIGINAL LETTER. UNDOUBTEDLY THE ORIGINAL CORRESPONDENCE IS ON FILE. KINDLY ADVISE US IF ANYTHING FURTHER IS NECESSARY TO PUT THIS CLAIM IN ORDER. WE ARE ADVISED BY THE COMMISSIONER OF CUSTOMS TO TAKE THIS MATTER UP WITH YOU UNDER SECTION 236 OF THE ACT OF APRIL 10.

A-94121, MAY 27, 1938, 17 COMP. GEN. 1012

CUSTOMS SERVICE - DUTIES - REFUNDS - ENTRIES SUBSEQUENTLY DAMAGED BY FLOOD WHERE SEED IN ITS CONDITION AS IMPORTED WAS FOUND TO MEET THE REQUIREMENTS OF THE FEDERAL SEED ACT, AND WAS IN THE CUSTODY OF THE CONSIGNEE UNDER REDELIVERY BOND AT THE TIME IT WAS RENDERED WORTHLESS BY A FLOOD, THERE IS NO AUTHORITY EITHER UNDER SECTION 563 OF THE TARIFF ACT OF 1930, 46 STAT. 746, AUTHORIZING THE SECRETARY OF THE TREASURY TO REFUND DUTIES UNDER CERTAIN CIRCUMSTANCES OF DAMAGE, ETC., OR OTHERWISE TO REFUND THE CUSTOMS DUTY PAID, NOR ARE THERE PRESENT SUCH ELEMENTS OF LEGAL LIABILITY OR EQUITY AS WOULD WARRANT REPORTING THE CLAIM TO THE CONGRESS FOR RELIEF UNDER THE ACT OF APRIL 10, 1928, 45 STAT. 413.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE J. M. MCCULLOUGH'S SONS CO., MAY 27, 1938:

THERE HAS BEEN CONSIDERED YOUR LETTER OF MARCH 1, 1938, AS FOLLOWS:

WE ARE ENCLOSING ORIGINAL LETTER--- REF. 104430 FROM THE TREASURY DEPARTMENT. UNDOUBTEDLY THE ORIGINAL CORRESPONDENCE IS ON FILE--- BUREAU OF CUSTOMS FOR YOUR INFORMATION. KINDLY ADVISE US IF ANYTHING FURTHER IS NECESSARY TO PUT THIS CLAIM IN ORDER. WE ARE ADVISED BY THE COMMISSIONER OF CUSTOMS TO TAKE THIS MATTER UP WITH YOU UNDER SECTION 236 OF THE ACT OF APRIL 10, 1928 (U.S.C. TITLE 31.)

WE FILED CLAIM FOR REFUND OF DUTY PAID ON 30,000 LBS. ALSIKE CLOVER SEED ENTERED UNDER CINCINNATI CONSUMPTION ENTRY 632 DATED JANUARY 13, 1937, WHICH, WAS DESTROYED IN THE OHIO VALLEY FLOOD DURING THAT MONTH.

THE SEED WAS MADE UNFIT FOR SEEDING PURPOSES WITHIN A FEW HOURS AFTER RELEASE BY THE DEPARTMENT OF AGRICULTURE AND BEFORE NOTICE COULD BE RECEIVED. HOWEVER, THIS RELEASE WAS AMENDED LATER WHEN ENTRY WAS REFUSED. CONSEQUENTLY WE ARE ENTITLED TO CLAIM FOR THE DUTY PAID AT 4 CENTS A LB. OR $1,200.00. UNFORTUNATELY THIS ENTRY WAS FINALLY LIQUIDATED ON AUGUST 25TH AND AMENDED DECISION BY THE DEPARTMENT OF AGRICULTURE WAS NOT MADE UNTIL AFTER AUGUST 27TH. IT WAS IMPOSSIBLE TO FILE A CLAIM LE A CLAIM WITHIN THE 60-DAY PERIOD, IN FACT WE WERE ORALLY ADVISED AT THE TIME BY THE OFFICE HERE IN CINCINNATI TO LET THE MATTER REST AND WE HAD EVERY REASON TO BELIEVE THAT IT WAS BEING HANDLED AUTOMATICALLY AND WE WOULD RECEIVE THE REFUNDED DUTY IN DUE COURSE. WE FEEL THAT THIS CLAIM IS THOROUGHLY JUST AND WE ARE ENTITLED TO THIS REFUND.

THE RECORD SHOWS THAT THE IMPORTATION OF SEED WAS ENTERED UNDER CONSUMPTION ENTRY NO. 632 ON JANUARY 13, 1937, AND THAT THE APPLICABLE DUTY THEREON WAS PAID ON THAT DATE IN THE AMOUNT OF $1,200. SHORTLY THEREAFTER SAMPLES OF THE SEED WERE FORWARDED TO THE BUREAU OF PLANT INDUSTRY, WASHINGTON, D.C., WHERE THEY WERE EXAMINED AND FOUND TO MEET THE REQUIREMENTS OF THE FEDERAL SEED ACT. ON JANUARY 21, 1937, A TELEGRAM PERMITTING ENTRY OF THE SEED WAS RECEIVED IN THE CINCINNATI CUSTOMS OFFICE, BUT SINCE YOU HAD ABANDONED YOUR PLANT DUE TO FLOOD CONDITIONS THIS NOTIFICATION DID NOT REACH YOU UNTIL JANUARY 28, 1937. AFTER THE FLOOD WATER HAD SUBSIDED, IT WAS FOUND THAT THE SEED HAD BEEN RENDERED WORTHLESS BY THE FLOOD. ON JUNE 30, 1937, ANOTHER SAMPLE OF THE SEED WAS FORWARDED TO THE BUREAU OF PLANT INDUSTRY FOR FURTHER EXAMINATION AND BY LETTER OF AUGUST 24, 1937, THE BUREAU OF PLANT INDUSTRY NOTIFIED THE CINCINNATI CUSTOMS OFFICE THAT THE IMPORTATION WAS FOUND TO BE PROHIBITED. HOWEVER, THE COMMISSIONER OF CUSTOMS HAS ADVISED THAT THE FINDING ON AUGUST 24 THAT THE SEED WAS PROHIBITED WAS BASED ON THE CONDITION OF THE SEED AT THAT TIME RATHER THAN ON ITS CONDITION AS IMPORTED ON JANUARY 13, 1937.

THE RECORD FURTHER SHOWS THAT UPON ENTRY AND PAYMENT OF DUTY THE ENTIRE SHIPMENT WAS RELEASED TO YOU UNDER REDELIVERY BOND IN ACCORDANCE WITH ARTICLE 591 OF THE CUSTOMS REGULATIONS OF 1937, AS FOLLOWS:

EXAMINATION OF SEEDS--- DELIVERY IN BOND.--- AFTER SAMPLES OF SEED OFFERED FOR IMPORTATION INTO THE UNITED STATES FROM ANY FOREIGN COUNTRY HAVE BEEN DRAWN, SUCH SEED SHALL BE ADMITTED ONLY AFTER THE SEED HAS BEEN FOUND TO BE NEITHER ADULTERATED NOR UNFIT FOR SEEDING PURPOSES WITHIN THE MEANING OF THE ACT AND TO HAVE BEEN COLORED AS REQUIRED BY ARTICLE 592: PROVIDED, HOWEVER, THAT COLLECTORS OF CUSTOMS MAY DELIVER TO CONSIGNEE SHIPMENTS WHICH HAVE BEEN SAMPLED, ON THE EXECUTION OF A BOND ON CUSTOMS FORM 7551 OR 7553 CONDITIONED UPON THE RETURN OF THE SHIPMENTS, OR ANY PART THEREOF, TO THE COLLECTOR WHEN DEMANDED BY HIM FOR ANY REASON. THE PENALTY OF THE BOND OR THE CHARGE AGAINST THE TERM BOND WILL BE COLLECTED AS LIQUIDATED DAMAGES FOR FAILURE TO RETURN TO THE COLLECTOR ON DEMAND ANY PART OF THE SEED OR ANY PART OF THE CLEANINGS OR REFUSE FROM THE SEED.

ARTICLE 596 OF THE CUSTOMS REGULATIONS PROVIDES, IN EFFECT, THAT WHEN THE BUREAU OF PLANT INDUSTRY INFORMS THE COLLECTOR OF CUSTOMS THAT IMPORTED SEED HAS BEEN FOUND TO COMPLY WITH THE PROVISIONS OF THE FEDERAL SEED ACT, THE REDELIVERY PROVISION OF THE BOND SHALL BE CANCELED. IN THE PRESENT CASE, THE SEED IN ITS CONDITION AS IMPORTED ON JANUARY 13, 1937, WAS FOUND TO MEET THE REQUIREMENTS OF THE FEDERAL SEED ACT WITH THE RESULT THAT UNDER THE PROVISIONS OF ARTICLE 596, SUPRA, THE REDELIVERY PROVISIONS OF THE ENTRY BOND WERE CANCELED UPON RECEIPT OF THE UNCONDITIONAL RELEASE IN THE OFFICE OF THE DEPUTY COLLECTOR AT CINCINNATI ON JANUARY 21, 1937.

THE GENERAL RULE IS THAT THE RIGHT OF THE GOVERNMENT TO DUTIES ACCRUES UPON THE IMPORTATION OF THE GOODS--- I.E., UPON THEIR ARRIVAL WITHIN THE LIMITS OF THE PORT OF ENTRY OF THE UNITED STATES WITH THE INTENTION TO UNLADE THEM--- AND THIS RIGHT IS NOT AFFECTED BY THE SUBSEQUENT LOSS, DESTRUCTION, OR DAMAGE OF THE GOODS UNLESS IN SPECIAL CASES AUTHORIZED BY STATUTE. UNITED STATES V. LYMAN, 1 MASON 482, 26 FED. CASES 1024, 1032. SEE ALSO TREASURY DECISION 38354, 58 (T.D. 38547, AND 38 T.D. 738), WHICH CASE INVOLVED THE DESTRUCTION OF IMPORTED GOODS NOT IN BONDED WAREHOUSE, THE COURT SAID:

THE APPELLANT HAS BEEN THE VICTIM OF A GREAT MISFORTUNE AND THE APPEAL IS STRONG THAT IT SHOULD NOT SUFFER THE LOSS OF ITS GOODS AND THE VERY LARGE AMOUNT OF DUTIES PAID THEREON AS WELL. NEVERTHELESS, AS THE LAW HAS MADE NO PROVISION FOR THE RETURN OF DUTIES IN SUCH CASES AS THIS, THE COURT IS POWERLESS TO GRANT RELIEF.

SECTION 563 OF THE TARIFF ACT OF 1930, 46 STAT. 746, AUTHORIZES THE SECRETARY OF THE TREASURY TO REFUND DUTIES UNDER CIRCUMSTANCES AS SET FORTH THEREIN. SAID SECTION IS AS FOLLOWS:

(A) ALLOWANCE.--- IN NO CASE SHALL THERE BE ANY ABATEMENT OR ALLOWANCE MADE IN THE DUTIES FOR ANY INJURY, DETERIORATION, LOSS, OR DAMAGE SUSTAINED BY ANY MERCHANDISE WHILE REMAINING IN CUSTOMS CUSTODY, EXCEPT THAT THE SECRETARY OF THE TREASURY IS AUTHORIZED, UPON PRODUCTION OF PROOF SATISFACTORY TO HIM OF THE LOSS OR THEFT OF ANY MERCHANDISE WHILE IN THE APPRAISER'S STORES, OR OF THE ACTUAL INJURY OR DESTRUCTION, IN WHOLE OR IN PART, OF ANY MERCHANDISE BY ACCIDENTAL FIRE OR OTHER CASUALTY, WHILE IN BONDED WAREHOUSE, OR IN THE APPRAISER'S STORES, OR WHILE IN TRANSPORTATION UNDER BOND, OR WHILE IN THE CUSTODY OF THE OFFICERS OF THE CUSTOMS, ALTHOUGH NOT IN BOND, OR WHILE WITHIN THE LIMITS OF ANY PORT OF ENTRY AND BEFORE HAVING BEEN LANDED UNDER THE SUPERVISION OF THE OFFICERS OF THE CUSTOMS, TO ABATE OR REFUND, AS THE CASE MAY BE, THE DUTIES UPON SUCH MERCHANDISE, IN WHOLE OR IN PART, AND TO PAY ANY SUCH REFUND OUT OF ANY MONEYS IN THE TREASURY NOT OTHERWISE APPROPRIATED, AND TO CANCEL ANY WAREHOUSE BOND OR BONDS, OR ENTER SATISFACTION THEREON IN WHOLE OR IN PART, AS THE CASE MAY BE, BUT NO ABATEMENT OR REFUND SHALL BE MADE IN RESPECT OF INJURY OR DESTRUCTION OF ANY MERCHANDISE IN BONDED WAREHOUSE OCCURRING AFTER THE EXPIRATION OF THREE YEARS (OR TEN MONTHS IN THE CASE OF GRAIN) FROM THE DATE OF IMPORTATION. THE DECISION OF THE SECRETARY OF THE TREASURY AS TO THE ABATEMENT OR REFUND OF THE DUTIES ON ANY SUCH MERCHANDISE SHALL BE FINALAND CONCLUSIVE UPON ALL PERSONS.

HOWEVER, AS DISCLOSED BY THE RECORD, THE SHIPMENT HERE INVOLVED WAS NOT IN THE CUSTODY OF CUSTOMS OFFICERS AS CONTEMPLATED IN SECTION 563, SUPRA, BUT WAS IN YOU POSSESSION AND UNDER YOUR CONTROL UNDER REDELIVERY BOND AND, CONSEQUENTLY, SAID SECTION HAS NO APPLICATION THERETO.

WITH REFERENCE TO THE MATTER OF YOUR INABILITY TO FILE CLAIM WITHIN 60 DAYS FROM THE DATE OF LIQUIDATION OF THE ENTRY ON JUNE 25, 1937, AS REQUIRED BY SECTION 514 OF THE TARIFF ACT OF 1930, 46 STAT. 734, FOR THE REASON THAT THE FINDING OF THE BUREAU OF PLANT INDUSTRY OF AUGUST 24, 1937, THAT THE SEED WAS PROHIBITED, WAS NOT RECEIVED BY YOU UNTIL AUGUST 27, IT APPEARS THAT SUCH FACT HAS NO BEARING ON THE MATTER. SAID SECTION, INSOFAR AS HERE CONCERNED, RELATES TO PROTESTS AGAINST COLLECTOR'S DECISIONS CONCERNING THE RATE AND AMOUNT OF DUTIES CHARGEABLE AS TO ANY PARTICULAR IMPORTATION WITH RESPECT TO WHICH CLAIM IS REQUIRED TO BE FILED WITHIN 60 DAYS AFTER LIQUIDATION, RELIQUIDATION, DECISION, OR REFUSAL AS THE CASE MAY BE. HOWEVER, IN THE INSTANT MATTER, THERE WAS NOT AT ANY TIME FOR DISPUTE WITH RESPECT TO THE RATE OF DUTY APPLICABLE TO THE IMPORTATION OR THE AMOUNT CHARGEABLE THEREON.

ACCORDINGLY, SINCE THERE IS NO PROVISION OF LAW FOR THE RETURN OF DUTIES PAID UNDER CIRCUMSTANCES SUCH AS HERE INVOLVED, YOUR CLAIM FOR REFUND THEREOF MUST BE, AND IS, DISALLOWED.

WITH REFERENCE TO THE SUGGESTION THAT THIS CLAIM BE REPORTED TO THE CONGRESS UNDER THE ACT OF APRIL 10, 1928, 45 STAT. 413, I DO NOT FIND THAT SAID CLAIM CONTAINS SUCH ELEMENTS OF LEGAL LIABILITY OR EQUITY AS IS NECESSARY TO AUTHORIZE SUCH ACTION.