Samara v. United States

• Decision Date: 06 July 1942
• Docket Number: No. 224.,224.
• Parties: SAMARA v. UNITED STATES.
• Court: U.S. Court of Appeals — Second Circuit

129 F.2d 594 (1942)

SAMARA v. UNITED STATES.

No. 224.

Circuit Court of Appeals, Second Circuit.

July 6, 1942.

Kenneth Carroad, of New York City (Clifford H. Rich and Lawrence W. Kaufman, both of New York City, on the brief), for appellant.

Mathias F. Correa, U. S. Atty., of New York City (Samuel Brodsky and David McKibbin, 3rd, Asst. U. S. Attys., both of New York City, of counsel), for appellee.

Before L. HAND, SWAN, and FRANK, Circuit Judges.

SWAN, Circuit Judge.

This is an appeal by the plaintiff from a judgment dismissing his complaint in an action for recovery of $264.91 paid by him as compensating taxes upon importations of cotton prior to the Supreme Court's decision in United States v. Butler, 297 U.S. 1, 56 S.Ct. 312, 80 L.Ed. 477, 102 A.L.R. 914, invalidating the statute under which such taxes were collected. After the filing of the complaint and before answer, the defendant moved to dismiss the complaint on the ground that the court lacked jurisdiction because of the insufficiency of the claim for refund. Certified copies thereof and of letters of the commissioner relating thereto were annexed to the motion papers. This motion was granted in an opinion reported in D.C., 39 F.Supp. 880, and resulted in the judgment appealed from.

Title VII of the Revenue Act of 1936 prescribes administrative procedure for the recovery of amounts collected as taxes under the invalidated Agricultural Adjustment Act of 1933. Section 902 of said Title VII, 7 U.S.C.A. § 644, provides that no refund shall be allowed "unless the claimant establishes to the satisfaction of the Commissioner in accordance with regulations prescribed by him * * * or to the satisfaction of the trial court," that he bore the burden of the tax and has not shifted it to another. Section 903, 7 U.S.C.A. § 645, provides that no refund shall be allowed unless a claim for refund has been filed by the claimant "in accordance with regulations prescribed by the Commissioner"; and this is followed by the sentence: "All evidence relied upon in support of such claim shall be clearly set forth under oath." The applicable regulations are Articles 201 and 202 of Regulations 96.¹

On June 30, 1937 the appellant filed a timely claim for refund on the prescribed form, P. T. Form 77, verified by his oath. It set forth the several tax payments making up the amount claimed, $264.91, and alleged in the words of section 902 that the burden of the taxes was borne by the claimant and not shifted to another. Concededly the claim was sufficient in every respect except that no evidentiary facts, other than copies of the customs entries, were included in Schedule D in support of such allegation. Paragraph 6 of the instructions, with which compliance is demanded by Article 201 of Regulations 96, provides that "The facts and evidence, together with exhibits and other data showing the amount of the burden of the tax borne by the claimant and not shifted to other persons, shall be made a part of Schedule D." And Paragraph 7 of the instructions substantially copies Article 202 of the Regulations. By letter dated November 26, 1938, the Commissioner notified the appellant that an examination of the claim disclosed that he had "not submitted sufficient evidence to establish, as required under section 902 of the Revenue Act of 1936" that he bore the burden of tax for which he claimed refund and had not shifted it to others. Various types of evidence which might be available were suggested, and he was advised that action on the claim would be suspended for thirty days to enable him to submit such evidence as he thought pertinent. No reply having been received, the Commissioner wrote again on January 28, 1939 that if the "requested evidence" was not furnished within thirty days, "it will be necessary to proceed with the adjustment of the claim on the basis of the evidence on file." This letter was also disregarded. By letter of March 15, 1939 the Commissioner gave notice that since the appellant had not submitted evidence sufficient to establish that he bore the burden of the tax, "the Commissioner is without authority to favorably consider your claim, and it is hereby rejected in full."

As we see it, the letters of the Commissioner indicate clearly that he examined on the merits the appellant's claim for refund and rejected it because the evidence submitted did not establish to his satisfaction, as required by section 902, that the claimant had not shifted the burden of the tax. That section plainly contemplates that the trial court may be satisfied on that issue, although the Commissioner was not. Consequently a rejection of the claim on that ground cannot mean that the court lacks jurisdiction to entertain a suit to recover the refund disallowed by the Commissioner. Whether the court will be confined to the same evidence as was presented to the Commissioner is another question to be later discussed; for the moment we consider only the alleged lack of jurisdiction of the court.

The trial court's opinion reasons that section 903 requires the claimant to set forth under oath the evidence relied upon in support of his claim, and since the present claim did not meet this requirement "the Commissioner was without jurisdiction to consider the claim on the merits." With this view we are unable to agree. The defect in form resulting merely from failure to comply with paragraphs 6 and 7 of the instructions, compliance with which was made compulsory by Article 201 of the Regulations, was not jurisdictional and could be waived by the Commissioner. See Tucker v. Alexander, 275 U.S. 228, 231, 48 S.Ct. 45, 72 L.Ed. 253; Bonwit Teller & Co. v. Commissioner, 283 U.S. 258, 264, 51 S.Ct. 395, 75 L.Ed. 1018; United States v. Memphis Cotton Oil Co., 288 U.S. 62, 71, 53 S.Ct. 278, 77 L.Ed. 619. The statutory provision in section 903 respecting setting forth "all evidence relied upon" in support of the claim means, in our opinion, all evidence upon which the claimant relies rather than all available evidence.² If the latter were the meaning it would follow that the Commissioner could reject a claim, even though satisfied on the evidence submitted that the tax burden had not been shifted, because additional corroboratory evidence available to the claimant had not been set forth in the claim — a most unreasonable construction. Several district courts have held that the complaint need not allege that all available evidence has been presented to the Commissioner. Hutzler Bros. v. United States, D.C.Md., 33 F.Supp. 801; Ney v. United States, D.C.W.Va. 33 F.Supp. 554. On the issue of who bore the burden of the tax the claim at bar was not wholly unsupported by evidence. There was evidence that the claimant paid the tax and his affidavit that he had not shifted the burden to another. So we think that the statutory requirement that "all evidence relied upon" be set forth was met and that any defect in form of the claim resulted from failure to observe the regulations — a defect which could be waived. The Commissioner did not reject the claim because it...