George Moore Ice Cream Co. v. Rose

• Decision Date: 09 November 1932
• Docket Number: No. 6522.,6522.
• Citation: 61 F.2d 605
• Parties: GEORGE MOORE ICE CREAM CO., Inc., v. ROSE.
• Court: U.S. Court of Appeals — Fifth Circuit

61 F.2d 605 (1932)

GEORGE MOORE ICE CREAM CO., Inc., v. ROSE.^*

No. 6522.

Circuit Court of Appeals, Fifth Circuit.

November 9, 1932.

J. C. Murphy and D. J. Gantt, both of Atlanta, Ga., for appellant.

C. P. Goree, Asst. U. S. Atty., of Atlanta, Ga., and Lester L. Gibson, Sp. Atty., Bureau of Internal Revenue, of Washington, D. C., for appellee.

Before BRYAN, HUTCHESON, and WALKER, Circuit Judges.

WALKER, Circuit Judge.

This was an action brought on March 28, 1931, by the appellant against the appellee, Collector of Internal Revenue, to recover the principal sum of $4,551.01, with interest, that sum being part of the amount, $6,871.18, assessed against appellant, in November, 1921, as a deficiency of income and profits taxes for the year 1917, and paid by him on November 5, 1923. Appellant's petition alleged the filing by him on November 5, 1927, of a claim for refund. That petition as it was amended showed that the only ground stated in the claim for refund which was relied on in the suit was the following:

"Apparent Errors in Adjustments in Invested Capital at December 31, 1916, and in Net Income for 1917.

"It is believed that the agent was in error in eliminating the following items from assets shown on balance sheet as of December 31, 1916:

                  Wagons .................................. $1,750.00
                  Tubs, cans and cabinets .................  1,000.00
                  Furniture and fixtures ..................    300.00
                  Accounts receivable .....................    819.87
                  Notes receivable ........................    400.00
                                                            _________
                                                            $4,269.87
                

and that these amounts should be restored to Invested Capital, an audit is now being made of taxpayers books to determine the correctness of these adjustments as well as the adjustments made in Net Income for the year 1917.

"The original return for this year reflected a loss of $21,047.25. The agent made adjustments to reflect taxable gain of $16,940.18 — a difference of $37,987.43.

"If the audit now being made reflects a different result it will be submitted as additional evidence."

The amended petition after alleging the filing of the claim for refund, alleged as follows:

"That thereafter on or about November 13, 1928, and January 2nd, 1929, detailed statements showing all of the items entering into and making up net income and invested capital were duly filed with the Commissioner of Internal Revenue supplementing and supporting the claim, said statements being under oath and intended as amendments to the claim; that the commissioner accepted the claim without objecting to it as insufficient in form and had the same under consideration from November 5, 1927; that the amendments to the claim were filed prior to May 1, 1929, and before the Commissioner had acted on the claim and no objection was made to the sufficiency of the claim until June 20, 1929.

"Said claim for refund, together with supplemental data as recited in above paragraph, was referred by the Commissioner of Internal Revenue to the Internal Revenue Agent in Charge, Atlanta, Georgia, and was assigned to Revenue Agent H. E. Smith for verification, and after examination he determined that plaintiff was rightfully entitled to a refund of $4,551.01 based upon a corrected tax liability of $2,322.98. Copy of letter acknowledging such corrected tax liability is attached hereto and marked Exhibit `B'.

"That thereafter on September 18, 1929, the Commissioner of Internal Revenue rejected said claim for refund in full."

The letter, a copy of which was made Exhibit "B," was dated February 21, 1929, and the body of it was the following:

"Find herewith agreement form 866 prepared for the signatures of the officers of the above named corporation. You will note that the corrected tax liability is $2,322.98. Originally or previously assessed $6,873.99, refund due $4,551.01.

"The amended net income upon which this tax is computed is $9,546.35, arrived at as explained to you in conference the other day.

"Kindly have this document signed by the president, attested by the secretary, the corporate seal affixed, and dated, and return to me in the enclosed envelope at the earliest possible date."

It appears from the opinion rendered, but not from the record proper, that by amendment of the petition, allowed August 10, 1931, the facts upon which the above set out letter was based were set forth as follows:

                  "Net Income on which Commissioner
                    based additional assessment of $6,873.99 ..... $16,940.18
                  "Less
                    Coca Cola rebates due Customers
                      at December 31, 1917               $5,666.10
                    Checks outstanding for purchases
                      December 31, 1917.............      2,188.55
                                                         _________
                      Total ........................     $7,854.65
                  "Plus
                    Checks issued in 1916 and
                      paid in 1917 .................        460.82
                                                         _________
                        Net reduction ............................   7,393.83
                                                                   __________
                  "Corrected Net Income .......................... $ 9,546.35"
                

The petition as amended did not allege that the alleged payment by appellant was made under protest. The court sustained a demurrer to the petition as it was amended, and dismissed that petition.

In argument in behalf of the appellee it was contended that the action of the court in sustaining the demurrer to the amended petition is sustainable on the grounds: (1) That the suit was not maintainable because the amended petition did not show that the alleged payment exacted of the appellant was made under protest; and (2) that the amended petition did not show that the ground...