Chatterjee v. Commissioner of Revenue Svcs.

• Decision Date: 11 April 2006
• Docket Number: No. 17354.,17354.
• Citation: 894 A.2d 919,277 Conn. 681
• Court: Connecticut Supreme Court
• Parties: Purnendu CHATTERJEE et al. v. COMMISSIONER OF REVENUE SERVICES.

Page 919

894 A.2d 919

277 Conn. 681

Purnendu CHATTERJEE et al. v. COMMISSIONER OF REVENUE SERVICES.

No. 17354.

Supreme Court of Connecticut.

Argued November 29, 2005.

Decided April 11, 2006.

Timothy P. Noonan, Buffalo, NY, with whom were Linda L. Morkan, John R. Shaughnessy, Jr., Hartford, and, on the brief, Paul R. Comeau, Buffalo, NY, for the appellants (plaintiffs).

Philip Miller, assistant attorney general, with whom were Louis P. Bucari, Jr., Hartford, and, on the brief, Richard Blumenthal, attorney general, and Mark Kohler, assistant attorney general, for the appellee (defendant).

SULLIVAN, C.J., and BORDEN, NORCOTT, PALMER and ZARELLA, Js.

NORCOTT, J.

The plaintiffs, Purnendu Chatterjee and Amita Chatterjee, appeal from the judgment of the trial court dismissing their appeal from the decision of the defendant the commissioner of revenue services,¹ denying their request for a tax refund pursuant to General Statutes § 12-39s.² On appeal,³ the plaintiffs claim that the trial court improperly concluded that it lacked jurisdiction to review the defendant's decision to deny the plaintiffs' request for a refund because, under § 12-39s(c), that determination is committed to the defendant's sole discretion after the expiration of the three year limitations period provided by General Statutes § 12-515.⁴ The plaintiffs also claim that the trial court's construction of § 12-39s(c) violates the due process clause of the fourteenth amendment to the United States constitution.⁵ We affirm the judgment of the trial court.

The record reveals the following facts and procedural history. The plaintiffs were born and raised in India and came to the United States to further their education. Although they own considerable property in India, the plaintiffs purchased an apartment located at 320 Central Park West in New York City in 1987. The plaintiffs purchased an additional apartment at the 320 Central Park West building in 1989, and also purchased a home in Greenwich that same year.

In 1989 and 1990, the plaintiffs filed capital gains, dividends and interest income tax returns in Connecticut, reporting taxes due of $95,787 and $162,005, respectively. The plaintiffs also filed Connecticut personal income tax returns for the years 1991 through 1993.⁶ In 1993, the state of New York performed a personal income tax audit on the plaintiffs for the years 1989 through 1993. The plaintiffs subsequently paid the state of New York $2.4 million to settle their tax liabilities as New York residents.⁷ They then filed amended Connecticut tax returns and claims for refunds of capital gains, dividends and interest income taxes paid from 1989 through 1993, contending that, pursuant to General Statutes § 12-505,⁸ they were not Connecticut residents for that time period and, accordingly, were not subject to Connecticut taxation.

The defendant granted the plaintiffs a refund for taxes paid in the years 1991 through 1993, but declined to do so for the years 1989 and 1990, stating that the three year statute of limitations provided by § 12-515 precluded him from doing so. The plaintiffs subsequently requested a hearing before the appellate division of the department of revenue services, and also requested that the defendant exercise his discretionary authority pursuant to § 12-39s; see footnote 2 of this opinion; and grant their claims for refunds of the 1989 and 1990 taxes. The defendant denied both requests, again citing the three year statute of limitations.

The plaintiffs appealed from the defendant's decision to the trial court pursuant to General Statutes § 12-522.⁹ Although the trial court found that the plaintiffs had filed their claims for a refund after the expiration of the statute of limitations, it nevertheless concluded that § 12-515 did not preclude the defendant¹⁰ from exercising her discretion to refund the 1989 and 1990 taxes under § 12-39s. Accordingly, the trial court remanded the case to the defendant to consider the merits of the plaintiffs' claim for a refund under § 12-39s. The trial court "recognize[d] that the [defendant] has not made a determination of the plaintiffs' claim on the merits of this case," and concluded that, "it would be inappropriate for this court to stand in the shoes of the [defendant] and make a decision on the merits ...." The trial court further concluded that the decision of whether to grant a refund pursuant to § 12-39s rested solely with the defendant and stated: "Since the [defendant's] decision under § 12-39s(c) cannot be appealed, this remand is a final judgment." Neither party appealed from the trial court's remand order.

On remand, the defendant again declined to issue the plaintiffs a refund, concluding that the requested refund was not authorized by § 12-39s(b) because the taxes in question were not "`erroneously or illegally collected or computed.'" The plaintiffs subsequently filed a motion for judgment in the trial court, claiming that the defendant had violated the trial court's prior order by not considering the merits of the plaintiffs' claim. In denying the plaintiffs' motion, the trial court stated that § 12-39s(c) precluded it from reviewing the defendant's decision on the merits. The trial court then rendered judgment dismissing the plaintiffs' appeal. This appeal followed.

On appeal, the plaintiffs claim that the trial court improperly: (1) refused to review the question of whether the defendant complied with its remand order; (2) concluded that § 12-39s(c) precluded it from reviewing the defendant's determination that the plaintiffs were not entitled to a refund under § 12-39s(b) because the taxes in question had not been "erroneously or illegally collected or computed"; and (3) interpreted § 12-39s(c) in a way that violates the constitutional guarantees of due process, equal protection and separation of powers. The defendant, in response, contends that the trial court correctly interpreted § 12-39s(c) as precluding judicial review of the defendant's decision, and also that such preclusion is constitutionally permissible. We first address the plaintiffs' second claim.¹¹

I

Because the present case involves an appeal from a decision of the defendant, "[a] brief overview of the statutory scheme that governs administrative appeals ... is necessary to our resolution of this issue. There is no absolute right of appeal to the courts from a decision of an administrative agency.... Appeals to the courts from administrative [agencies] exist only under statutory authority .... Appellate jurisdiction is derived from the ... statutory provisions by which it is created, and can be acquired and exercised only in the manner prescribed.... In the absence of statutory authority, therefore, there is no right of appeal...." (Internal quotation marks omitted.) Nine State Street, LLC v. Planning & Zoning Commission, 270 Conn. 42, 46, 850 A.2d 1032 (2004). This principle applies with equal force in tax appeals. Millward Brown, Inc. v. Commissioner of Revenue Services, 73 Conn.App. 757, 764, 811 A.2d 717 (2002) ("[f]or jurisdictional purposes ... we can see no distinction between tax appeals and other statutory appeals").

Although a statutory scheme exists to provide refunds to taxpayers who have overpaid their capital gains, dividends and interest income taxes,¹² it is undisputed that the plaintiffs seek to recover taxes paid beyond the three year statute of limitations provided by § 12-515. See footnote 4 of this opinion. The plaintiffs, therefore, seek to recover under § 12-39s, which permits the defendant to refund the improperly paid taxes despite the untimeliness of their request. Whether the defendant's decision to deny their request under § 12-39s is appealable is an issue of statutory construction.

"The issue before this court involves a question of statutory interpretation that ... requires our plenary review.... When construing a statute, [o]ur fundamental objective is to ascertain and give effect to the apparent intent of the legislature.... In other words, we seek to determine, in a reasoned manner, the meaning of the statutory language as applied to the facts of [the] case, including the question of whether the language actually does apply." (Citation omitted; internal quotation marks omitted.) Cogan v. Chase Manhattan Auto Financial Corp., 276 Conn. 1, 7, 882 A.2d 597 (2005). Moreover, in seeking to ascertain the meaning of a statute, we must consider General Statutes § 1-2z, which provides: "The meaning of a statute shall, in the first instance, be ascertained from the text of the statute itself and its relationship to other statutes. If, after examining such text and considering such relationship, the meaning of such text is plain and unambiguous and does not yield absurd or unworkable results, extratextual evidence of the meaning of the statute shall not be considered."

Accordingly, we begin with the language of the applicable statutes. Section 12-522, the statute under which the plaintiffs appealed, provides that "any person aggrieved because of any order, decision, determination or disallowance of the Commissioner of Revenue Services under the provisions of this chapter may ... take an appeal therefrom to the superior court for the judicial district of New Britain ...." (Emphasis added.) Contrary to the plaintiffs' contention, § 12-522 does not permit an appeal from the defendant's decision to deny a refund requested pursuant to § 12-39s. In fact, the application of § 12-522 is explicitly limited to denials made "under the provisions of [chapter 224 of title 12 of the General Statutes] ...." In contrast § 12-39s is contained in chapter 202 of title 12 of the General Statutes and is, therefore, beyond the ambit of § 12-522.

Moreover, § 12-39s(c), which provides that § 12-39s "shall not be construed as authorizing suit against the state by a person against whom any tax, penalty or interest has been erroneously or illegally assessed or from whom any tax,...