Pursuant  to the provisions of Circular No. 45 of the Central Bank, Lim Hu applied for license to import certain commodities from Hongkong on the  basis  of the so-called "no-dollar remittance".  His  application was denied.  Thereafter he started in the Manila  court  of first instance proceedings to compel said  institution to  issue the license or permit the importation  contending that the above-mentioned circular  was  null and void, said  Bank having no legal power to  promulgate  it.

The case was submitted upon  a stipulation  of  facts, on  the strength  of which,  the Manila  court  rendered judgment in accordance with the petitioner's complaint, annulled the circular,  and declared that the importation could be made, subject only to customs law.  The  Bank appealed.

It was stipulated  "that on August 3, 1953, Lim Hu filed applications for the importation into the Philippines from Hongkong of fresh garlic, soy sauce, fresh eggs, hams, fresh onions and fresh potatoes *  *  * on a no-dollar  remittance basis, pursuant  to  the requirements of  Central Bank Circular No.  45".

It was also  stipulated that, to pay for  the above consumer goods in Hongkong, Lim Hu stated he would use a credit of $500,000 of John Martin, in  said city, with the latter's consent, Martin and Lim  Hu  having  entered into an  agreement that the  latter  would  take  charge of the importation into and  sale  in the Philippines  of said goods, investing the proceeds in certain kinds of business in this country.

Circular No. 45 provided in  part: 

"Now therefore,  the Monetary Board, in pursuance  of Central Bank Circular No. 20 and other circulars  and notifications issued in pursuance thereto,  hereby requires any person or  entity who intends to import or receive  goods  from any foreign country for which no foreign exchange is  required or  will be required  of the banks, to apply for a license from the Monetary Board to authorize such import."

And Circular No. 20 restricting gold and foreign exchange transactions, subjected  to license  by the  Central Bank the  proposed arrangement between Lim Hu  and John Martin.

Defending the validity of its  Circular No. 45 the Bank alleges "it has authority to issue such regulation as maybe necessary to exercise its power * * *  to  license  (temporarily) all transactions in gold  and foreign exchange" (section  14  [a] in connection with section 74 Republic Act No. 265) ; and that the term foreign,exchange is applicable "to foreign currency and notes and coins, letters of credit, drafts, bills of exchange, or other instruments having international  financial implications" (section  2 paragraph [i]  Central Bank Circular  No. 31),  And in connection with the proposed transaction, the Bank says, John Martin a non-resident would thereby acquire an interest in Philippine pesos resulting from the sales of  the imported goods, and the  effect of the operation  would be an exchange of John Martin's money in Hongkong with  Philippine pesos here.  Lim Hu even covenanted to render to John Martin "semi-annual accounting of the moneys and properties" involved  in the importation. (Annex C,  Motion for New Trial.)   Hence it  was a transaction in foreign exchange, subject  to regulation,  concludes the Bank in sustaining this appeal.

On the other hand Lim Hu's counsel argues that "the application for license  by petitioner  is  without  foreign exchange"  and therefore beyond the power  of the  Bank to regulate.

Of course, it may readily be seen that, for the purposes of this importation Lim Hu  did not have to buy foreign exchange, i. e., did not have to  remit  money from Hongkong.  However,   whether the  transaction  would   have "international  financial  implications"  as  dealing   with foreign  drafts or promissory notes that is  the question, which for  reasons stated below,  we find it unnecessary to decide.

With  the approval of Republic Act No. 1296 effective June 16, 1955  and Republic Act No.  1410 effective September 10,  1955 a  writ of mandamus may not  now  be issued to allow this importation, because  after June 16, 1955  Lim Hu  could not be permitted  to  import onions, potatoes and garlic (Republic Act No. 1296) with  or without foreign  exchange and under Republic Act No.  1410 this importation under the so-called  "no-dollar remittance" may not be permitted.^[1]  If it  be argued  that Lim  Hu's application  had been submitted before the passage of the two laws, the  reply  would be that  no saving clause was inserted in said statutes exempting  from their prohibition all  applications for  importation previously filed.

The resultant situation is that, because this importation can not now be permitted, the  Central  Bank may not  be required  to grant  petitioner's application for  license.

Wherefore, the lower court's order allowing the importation, should be, as it is hereby,  reversed and the  petition for mandamus  denied.  No costs.

Paras, C.  J., Padilla, Montemayor, Bautista Angelo, Labrador, Concepcion, Reyes, J. B. L., and  Endencia, JJ., concur.
 
 

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^[1] See Millarez vs. Amparo, 97  Phil., 282, 51  Off.  Gaz. (7)  3462.