Walter E. Olsen & Co., Inc. vs. Aldanese

G.R. No. L-18740, March 29, 1922.

FACTS

Petitioner, a duly licensed domestic corporation, provides that, under the Tariff Act, it had the legal right to export from the Philippine Islands into the United States it’s manufactured tobacco. In 1916, the Philippine Legislature enacted Law No. 2613 entitled “An Act to improve the methods of production and the quality of tobacco in the Philippine and to develop the export trade therein.” The law allegedly empowers the Collector of Internal Revenue to establish rules defining the standard and the type of leaf and manufactured tobacco which may be exported into the United States. It also enjoins it as a duty to issue a certificate of origin and to permit the exportation to the United States of all cigars manufactured of material and tobacco.  

The petitioner claims that the Collector of Internal Revenue wrongfully and unlawfully refused to issue such certificate of origin “on the ground that said cigars were not manufactured of long filler tobacco produced exclusively in the provinces of Cagayan, Isabela or Nueva Vizcaya.” And that Act No. 2613 and the executive regulations issued in accordance therewith do not contravene any provision of the fundamental law of the Philippine Islands.

ISSUE

Whether or not the Collector of Internal Revenue’s rules and regulations within the scope and purview of the act.

HELD

NO. 

It will be noted that the power of the Collector of Internal Revenue to make rules and regulations is confined to the making of rules and regulations for the classification, making, and packing of tobacco, and that such power is further limited to the making of such rules for the classification, marking, and packing of tobacco as may be necessary to secure leaf tobacco of good quality and its handling under sanitary conditions. It is for such purpose only that the Collector of Internal Revenue is authorized to make any rules or regulations. 

The power is further limited “to the end that leaf tobacco be not mixed, packed, and marked as of the same quality when it is not of the same quality when it is not of the same class and origin.” It is only for such defined purposes that he is authorized to make any rules or regulations.