Eastern Tar Products Corp. v. State Tax Commission of Maryland

• Decision Date: 22 February 1939
• Docket Number: 43.
• Citation: 4 A.2d 462,176 Md. 290
• Parties: EASTERN TAR PRODUCTS CORPORATION et al. v. STATE TAX COMMISSION OF MARYLAND et al.
• Court: Maryland Court of Appeals

4 A.2d 462

176 Md. 290

EASTERN TAR PRODUCTS CORPORATION et al. v. STATE TAX COMMISSION OF MARYLAND et al.

No. 43.

Court of Appeals of Maryland

February 22, 1939

Appeals from Circuit Court of Baltimore City; Samuel K. Dennis Judge.

Separate actions by the Eastern Tar Products Corporation and the Hopkins Shoe Company, Incorporated, against the State Tax Commission of Maryland for a reversal of the action of the Commission in overruling plaintiffs' protests to tax assessments, wherein the Mayor and City Council of Baltimore intervened. From decrees affirming the action of the Commission, plaintiffs appealed, the two cases being consolidated on appeal.

Affirmed.

Arthur W. Machen and John Henry Skeen, both of Baltimore (Armstrong, Machen & Allen, of Baltimore, on the brief), for appellants.

Lawrence B. Fenneman, Deputy City Sol., and Michael J. Hankin, Asst City Sol., both of Baltimore (William C. Walsh, Atty. Gen William L. Henderson, Deputy Atty. Gen., and Charles C. G Evans, City Sol., of Baltimore, on the brief), for appellees.

Argued before BOND, C.J., and OFFUTT, PARKE, SLOAN, JOHNSON, and DELAPLAINE, JJ.

DELAPLAINE Judge.

The appellants are ordinary business corporations engaged in manufacturing in Baltimore City. They were incorporated under the laws of Maryland in 1935, and in 1937 the State Tax Commission of Maryland tentatively assessed Eastern Tar Products Corporation on raw materials and manufactured products at $60,500, and Hopkins Shoe Co., Inc., on raw materials and manufactured products at $10,000 and on tools and machinery used in manufacturing at $10,255.

The appellants protested against the assessments, claiming exemption from City taxation on raw materials and manufactured products, while the shoe company also claimed exemption from both State and City taxation on tools and machinery used in manufacturing.

The State Tax Commission overruled the protests and made the assessments final on the ground that the appellants had failed to file their applications for exemption, as required by ordinance, prior to September 1, 1936.

The appellants thereupon petitioned the Circuit Court of Baltimore City for a reversal of the action of the Commission. Code Supp.1935, art. 81, § 186. The Mayor and City Council of Baltimore intervened as a party in each case. The Court below affirmed the action of the Commission, and the two cases were consolidated in one record on appeal to this Court.

The Tax Revision Act (Acts 1929, ch. 226), by which the Legislature revised the revenue and tax laws of this State, provides that the following property shall be exempt from assessment and from State, county and city taxation (Code Supp.1935, art. 81, § 7):

'(25) Tools (including mechanical tools), implements, whether worked by hand, steam or other motive power, machinery, manufacturing apparatus or engines used in manufacturing, whether temporarily idle or not, in any county (including the City of Baltimore) in which by law, resolution or ordinance the same are or may be exempt from county or city taxation; and the County Commissioners of any county and the Mayor and City Council of Baltimore are hereby authorized to pass such resolution or ordinance.

'(26) Raw materials on hand and manufactured products in the hands of the manufacturer in any city and/or county in which by law, resolution or ordinance the same are or may be exempt from county and/or city taxation; provided that nothing in this sub-section shall exempt any such property from State taxation or from assessment therefor.'

Since 1880 the City of Baltimore has also been authorized by local law to allow manufacturer's exemptions. Acts of 1880, chs. 187 and 235; Acts of 1912, ch. 32; Acts of 1914, ch. 528; Acts of 1916, ch. 561; Acts of 1918, ch. 82, sec. 10. The act of 1916, ch. 561, contains the following provision: 'It shall be the duty of the Appeal Tax Court to make such abatement of taxes, levied as aforesaid, as may be authorized and directed by ordinance, as aforesaid; provided that application for such abatement as aforesaid shall be made by the party applying for the same before the annual revision and correction of the tax lists for the year in which said applicant desires such abatement.'

This provision is found in art. 4, sec. 6, subsec. 28(c), of the Code of Public Local Laws of Maryland (1930 Edition), which was legalized by ch. 193 of the Acts of 1929, approved by the Governor on April 2, 1929, the day on which the Tax Revision Act was approved. It is also included in the Charter of Baltimore City (1938 Edition), art. 1, sec. 6, subsec. 28(c).

In 1919 the Mayor and City Council of Baltimore passed Ordinance No. 462, providing that all personal property used in connection with manufacturing, including raw materials, manufactured products, tools and machinery, shall be exempt from taxation for municipal purposes. This ordinance provides:

'It shall be the duty of every person, firm or corporation entitled to an exemption, under this ordinance, to make application before the first day of September, 1919, to the Appeal Tax Court of Baltimore City, in writing and verified, as may be required by said Appeal Tax Court and upon blanks to be furnished by said Court. It shall be the duty of the Appeal Tax Court to provide sufficient blanks and furnish the same to anybody, upon request, for the purpose of making the application herein provided for and upon such application being made, and the facts therein being verified, to the satisfaction of said Court, by affidavit or otherwise, as may be directed by said Court, it shall be the duty of said Court to segregate the property entitled to exemption, under this ordinance, from other property, if any, of the applicant, not entitled to exemption hereunder and designate upon the assessment roll all the property entitled to exemption, under this Ordinance.

'The taxes levied, from year to year, by the Mayor and City Council of Baltimore, for ordinary City purposes shall not apply to the property so designated as exempted, in pursuance of this Ordinance. Such properties so designated as exempted, shall continue to be exempt thereafter, from...