HQ 224950: Application for Further Review of Protest No. 1401-93-100168; Liability for duties; Missing package after merchandise "permitted"; Unconcealed shortage; 19 CFR 158.3

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                            HQ 224950

                         March 18, 1994

ENT-1-03/ENT-1-07-CO:R:C:E  224950 JRS          

CATEGORY:  Entry

Assistant District Director of Customs
Commercial Operations Division
101 East Main Street, Room 107
Norfolk, Virginia 23510

RE: Application for Further Review of Protest No. 1401-93-100168; 
   Liability for duties; Missing package after merchandise       
    "permitted"; Unconcealed shortage; 19 CFR 158.3 

Dear Sir:

     This is in response to your request dated September 13,
1993, requesting further review of the above-referenced protest. 
We have considered the issue raised and our decision follows. 

FACTS:

     On December 10, 1992, construction tools were imported from
Germany into the Norfolk district.  On December 30, 1992, an
entry (CF 3461) was made covering the 9 packages listed on the
manifest and the goods were released the same day.  The
importer's broker filed the entry summary (CF 7501) for the 9
manifested and invoiced packages on January 14, 1993. 
Subsequently, on April 16, 1993, the entry was liquidated.

     On June 11, 1993, the importer filed a protest challenging
the payment of duties on 1 out of the 9 packages entered.  The
importer, as part of this protest, has provided evidence (in the
form of its insurance claim documents against Givens Trucking
Co., Inc. and related "faxes") that 9 packages were delivered to
the Givens warehouse, the place where containers are stripped. 
(No date is specified as to when Givens received the merchandise;
however, we assume that it was sometime after December 30, 1992.) 
The importer states that on January 5, 1993, Southgate Trucking
received only 8 of the 9 boxes from Givens, which it subsequently
delivered to the importer.  The importer requests a refund of the
$703.83 in duties that were paid against the items (hand drills
and parts) in the missing box/package.

     We note that, notwithstanding the filing of the instant
protest, the importer also filed a petition under section 520 of
the Tariff Act of 1930, as amended (19 U.S.C. 1520(c)).  Customs
in Norfolk denied the section 520(c) petition on November 18,
1993 (see Protest No. 1401-93-200063, filed October 16, 1993) for
the reason that same issue raised was pending under this protest
and no clerical error was alleged.

ISSUE:

     Whether Customs may properly refund the duties assessed on a
package which is declared missing by the importer after it was
permitted and released from customs custody.

LAW AND ANALYSIS:

     Initially, we note that this protest was timely filed
pursuant to 19 U.S.C. 1514(a)(5).  The subject entry was
liquidated on April 16, 1993, and this protest was filed on 
June 11, 1993.

     It is a fundamental legal postulate that customs duty
attaches when goods are imported, and they are imported when they
come within the jurisdiction of the customs district.  See Mills
& Gibb Corporation v. United States, 13 Ct. Cust. Appls. 72, T.D.
40933 (1925); United States v. Shallus, 2 Ct. Cust. Appls. 332,
T.D. 32074 (1911).  The courts have consistently held that where
foreign goods are landed in the United States their loss or
destruction before they have become available to the owner does
not preclude the duties from becoming a personal debt of the
owner or consignee to the government.  See Art Craft Jewelry Co.
v. United States, 64 Cust. Ct. 414, 418, C.D. 4010 (1970), citing
and discussing American Pillowcase & Lace Co. v. United States,
20 Cust. Ct. 53, C.D. 1083 (1948), aff'd, 21 Cust. Ct. 228, Abs.
52646 (1948).

     Under section 158.3 of the Customs Regulations, CR (19 CFR
158.3), an allowance in the assessment of duties for lost or
missing packages of merchandise included in an entry summary
whenever it is established to the satisfaction of the district
director before the liquidation of the entry summary becomes
final that the merchandise claimed to be lost or missing was not
"permitted."  To be "permitted" as defined by section 158.1, CR,
the quantities of merchandise being delivered or available for
delivery from customs custody must be ascertained.  

     The intent of section 158.3, CR, and other sections in Part
158 is to give effect to the principle that the importer is
entitled to a reduction in liquidation for merchandise that
either is not delivered because it is lost or missing or is
completely or partially damaged prior to importation.  See T.D.
85-159.  
 
     The importer has not presented any evidence that the missing
package was not available for delivery from the carrier within
the provisions of section 448(a) of the Tariff Act of 1930, as
amended (19 U.S.C. 1448(a)).  For instance, the record does not
reveal that any Manifest Discrepancy Report was filed at the time
of entry summary.  On the contrary, all evidence points to the
fact that 9 packages were imported by the carrier.  In fact, the
protestant/importer does not dispute that the 9 invoiced and
manifested packages were landed in the United States and
released; he only asserts that there was a shortage in the number
of packages actually delivered to its premises after the goods
left Givens warehouse.  Deficiencies occurring after importation
are not provided for under 19 U.S.C. 1499.  Thus, the importer is
not entitled to relief from the payment of duties on the missing
package, in accordance with section 158.3, for all 9 packages
were "permitted" and the importer has failed to prove otherwise. 
He remains liable for the duties assessed on the missing package.

HOLDING:

     No refund of duties assessed on a package declared missing
is permissible under 19 CFR 158.3 after the merchandise was
released from customs custody.

     In accordance with Section 3A(11)(b) of Customs Directive
099 3550-065, dated August 4, 1993, Subject: Revised Protest
Directive, this decision should be mailed by your office to the
protestant no later than 60 days from the date of this letter. 
Any reliquidation of the entry in accordance with the decision
must be accomplished prior to mailing of the decision.  Sixty
days from the date of the decision the Office of Regulations and
Rulings will take steps to make the decision available to customs
personnel via the Customs Rulings Module in ACS and the public
via the Diskette Subscription Service, Lexis, Freedom of
Information Act and other public access channels.

                               Sincerely,

                               John Durant, Director