Atlantic Mills of Rhode Island v. United States, M-229.

• Citation: 78 Ct. Cl. 219,3 F. Supp. 699
• Decision Date: 05 June 1933
• Docket Number: No. M-229.,M-229.
• Parties: ATLANTIC MILLS OF RHODE ISLAND v. UNITED STATES.
• Court: Court of Federal Claims

3 F. Supp. 699

78 Ct. Cl. 219

ATLANTIC MILLS OF RHODE ISLAND v. UNITED STATES.

No. M-229.

Court of Claims.

June 5, 1933.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Lyle T. Alverson, of New York City (Johnson & Shores, of New York City, on the brief), for plaintiff.

George H. Foster, of Washington, D. C., and Charles B. Rugg, Asst. Atty. Gen., for the United States.

Before GREEN, LITTLETON, WILLIAMS, and WHALEY, Judges.

LITTLETON, Judge.

Plaintiff instituted this suit within six years after the delivery to it of the certificate of overassessment showing the overpayment for 1918 and the application of $137,005.64 thereof as a credit against that amount of an additional assessment due for 1917. The petition is in two counts. Count 1 seeks to recover the overpayment for 1918, and count 2 seeks to recover the same amount as an unlawful collection for 1917.

Plaintiff contends that the unlimited waivers for 1917 executed by it on January 21, 1921, and February 26, 1921, and thereafter filed with the Commissioner and approved and signed by him February 9, 1923, expired on December 31, 1923, and were not effective after that date under another document entitled "Income and Profits Tax Waiver" executed by plaintiff February 9, 1923, and thereafter filed with the Commissioner on a date not shown by the record. Finding 3. In other words, it is the position of the plaintiff, first, that it had the right to fix the termination date of the unlimited waivers, and that it did so in the last waiver executed by it February 9, 1923, and that the Commissioner's ruling and notice published April 11, 1923, that unlimited waivers on file in the Bureau for 1917 would expire April 1, 1924, was ineffective in this case, for the reason that plaintiff had already specified an earlier date on which such waivers would expire; and, second, that the last document executed by it February 9, 1923, was a valid and effective waiver under the statute with respect to 1917, notwithstanding it was not approved or signed by the Commissioner or by any one on his behalf.

We cannot sustain these contentions of the plaintiff. The document relied upon by plaintiff in support of these contentions, executed on February 9, 1923, is not susceptible of the construction that it was a notice to the Commissioner that the waivers theretofore duly executed and filed with the Commissioner and approved and signed by him February 9, 1923, would terminate on December 31, 1923.

By its plain terms this document was clearly intended as a consent in writing by the taxpayer and the Commissioner with respect to 1917, and it was executed and filed with the Commissioner with that purpose in mind and with the view that it would be approved and signed by the Commissioner as a waiver contemplated by the statute rather than as a notice that the consents theretofore filed and approved would terminate and become ineffective after December 31, 1923. The language of the document shows that it was intended as a waiver rather than as a notice, in that it stated "this waiver shall not be effective after December 31, 1923," and, further, that "this waiver shall not be effective unless all taxes for 1918 and 1919 shall be assessed, determined, and collected at December 31, 1923." If it could be held effective as a termination of the prior waivers, the termination date specified was conditioned upon the determination, assessment, and collection of all taxes for 1918 and 1919 on or before December 31, 1923, which was not done. In other words, one of the conditions of the instrument was that it would not be effective for any purpose unless the taxes for 1918 and 1919 were determined, assessed, and collected at December 31, 1923.

We cannot agree with the contention of plaintiff that the document executed by it on February 9, 1923, and thereafter filed with the Commissioner, was valid and effective as a consent in writing, although not approved or signed by the Commissioner; and that "it is well settled that the signature or approval of the Commissioner is not necessary to the validity of a waiver." The statute requires a "consent in writing" by the taxpayer and the Commissioner, and, unless it is shown that the Commissioner has indicated his approval or consent in writing in some way, a document signed by the taxpayer alone is not effective as a consent in writing under the statute. Compare Sabin v. United States, 44 F.(2d) 70, 70 Ct. Cl. 574; Eclipse Lawn Mower Co. v. United States (Ct. Cl.) 1 F. Supp. 768.

Although the consent in writing contemplated by the statute is not a contract and the Commissioner's consent is for administrative purposes, we think the case of Stange v. United States, 282 U. S. 270, 51 S. Ct. 145, 75 L. Ed. 335, is authority for the...