564 S.E.2d 167 (W.Va. 2002), 29996, CNG Transmission Corp. v. Craig
|Citation:||564 S.E.2d 167, 211 W.Va. 170|
|Opinion Judge:||STARCHER, Justice.|
|Party Name:||CNG TRANSMISSION CORPORATION, a West Virginia corporation, Petitioner below, Appellant, v. Rebecca Melton CRAIG, as Tax Commissioner of the State of West Virginia Respondent below, Appellee.|
|Attorney:||David K. Higgins, Esq., Paul G. Papadopoulos, Esq., Robinson & McElwee, PLLC, Charleston, for Appellant. Darrell V. McGraw, Jr., Attorney General, Joy M. Bolling, Assistant Attorney General, Charleston, for Appellee.|
|Case Date:||April 26, 2002|
|Court:||Supreme Court of Appeals of West Virginia|
Submitted Jan. 16, 2002.
[211 W.Va. 171] Syllabus by the Court
1. "Interpreting a statute or an administrative rule or regulation presents a purely legal question subject to de novo review." Syllabus Point 1, Appalachian Power Co. v. State Tax Dept. of West Virginia, 195 W.Va. 573, 466 S.E.2d 424 (1995).
2. "Any rules or regulations drafted by an agency must faithfully reflect the intention of the Legislature, as expressed in the controlling legislation. Where a statute contains clear and unambiguous language, an agency's rules or regulations must give that language the same clear and unambiguous force and effect that the language commands in the statute." Syllabus Point 4, Maikotter v. University of W.Va. Bd. of Trustees, 206 W.Va. 691, 527 S.E.2d 802 (1999).
3. "It is fundamental law that the Legislature may delegate to an administrative agency the power to make rules and regulations to implement the statute under which the agency functions. In exercising that power, however, an administrative agency may not issue a regulation which is inconsistent with, or which alters or limits its statutory authority." Syllabus Point 3, Rowe v. W.Va. Dept. of Corrections, 170 W.Va. 230, 292 S.E.2d 650 (1982).
4. "A statute, or an administrative rule, may not, under the guise of 'interpretation,' be modified, revised, amended or rewritten." Syllabus Point 1, Consumer Advocate Div'n v. Public Service Comm'n, 182 W.Va. 152, 386 S.E.2d 650 (1989).
5. The judiciary is the final authority on issues of statutory construction, and we are obliged to reject administrative constructions that are contrary to the clear language of a statute.
6. "In the absence of any definition of the intended meaning of words or terms used in a legislative enactment, they will, in the interpretation of the act, be given their common, ordinary and accepted meaning in the connection in which they are used." Syllabus Point 1, Miners in General Group v. Hix, 123 W.Va. 637, 17 S.E.2d 810 (1941), overruled on other grounds by Lee-Norse Co. v. Rutledge, 170 W.Va. 162, 291 S.E.2d 477 (1982).
7. Any sales of property or services directly used or consumed in the business of transmitting natural gas by pipeline, whether the natural gas being transmitted in the pipeline is owned by the business owner or not, are exempt from the consumer sales tax under W.Va.Code, 11-15-9(7)  and W.Va.Code, 11-15-9(g) .
In this appeal from the Circuit Court of Harrison County, appellant CNG Transmission Corporation ("CNG") challenges the circuit court's ruling upholding assessments against CNG for consumer sales taxes imposed by the Tax Commissioner of the State of West Virginia ("Tax Commissioner"). The taxes were assessed upon CNG's purchase of goods and services that were used in the transmission of natural gas owned by CNG.
After careful consideration, we reverse the circuit court's ruling, and find that the statutes in effect at the time of CNG's purchases
[211 W.Va. 172] exempted the purchase of goods and services used in the transmission of natural gas from the consumer sales tax, whether or not CNG owned the natural gas that was being transmitted.
Facts & Background
The instant case involves the interpretation of several tax statutes 1 that exempt companies in the business of the "transmission" of natural gas through a pipeline from paying consumer sales tax on the purchase of goods and services that are used to conduct that business. The Tax Commissioner disputes CNG's claim to have the status of a company in the business of transmission.
Between January 1986 and September 1993, CNG was engaged in the business of transporting natural gas through its pipeline system, both within and without the State of West Virginia. CNG was also in the business of making wholesale sales of "company-owned" natural gas that CNG bought from other suppliers. 2 To sell this company-owned natural gas, CNG would transport the natural gas to a subsequent purchaser through its pipeline system.
The Tax Commissioner, in an audit of CNG's records, found that between January 1, 1986, and September 30, 1993, from 5% to 13% of the natural gas flowing through CNG's pipelines was company-owned; the remaining 87% to 95% of the natural gas belonged to other companies. 3 The Tax Commissioner took the position that the transportation of company-owned natural gas for sale to others by CNG could not to be included in the statutorily tax-exempt activity of "transmission." The Tax Commissioner concluded that, between 1986 and 1993, CNG should have paid sales tax on 5% to 13% of all goods and services purchased and used to transport natural gas through CNG's pipelines. 4 With the addition of interest, on February 25, 1998, CNG was assessed with a total sales tax liability of $266,601.94.
After receiving notification of the tax assessment, CNG paid the tax liability and timely filed a petition for reassessment. By a decision dated February 22, 2000, an Administrative Law Judge ("ALJ") found that CNG was liable to the State of West Virginia for taxes related to the purchase of goods and services used in connection with its transportation of company-owned natural gas between January 1, 1986, and September 30, 1993. CNG subsequently sought judicial review of the decision in the Circuit Court of Harrison County. In an order dated January 22, 2001, the circuit court affirmed the ALJ's ruling.
CNG now appeals the circuit...
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