In re Wolrich

• Citation: 84 F. Supp. 481
• Parties: In re WOLRICH et al.
• Decision Date: 24 May 1949
• Court: U.S. District Court — Southern District of New York

84 F. Supp. 481

In re WOLRICH et al.

United States District Court S. D. New York.

May 24, 1949.

John F. X. McGohey, United States Attorney, New York City (Roy M. Cohn, Daniel H. Greenberg, New York City, of counsel), for plaintiff.

Arthur Block, Corcoran & Kostelanetz, New York City (Boris Kostelanetz, Rexford E. Tompkins, New York City, of counsel), for Samuel Gurian.

Louis Bender, New York City, for respondents.

RIFKIND, District Judge.

By two orders to show cause, the respondent and Gurian have brought on motions to vacate an order, heretofore issued by this court, requiring the respondent to appear before a Special Agent of the Bureau of Internal Revenue to testify and produce books and records relating to the tax liability of a taxpayer.

The order to appear, testify and produce was issued ex parte, on application of the Agent, acting under the authority of the Commissioner of Internal Revenue, who had previously required, by service of a so-called Commissioner's summons on Naboshek at the office of Naboshek, Gurian & Lindenbaum, accountants, that the latter firm appear and produce records relating to the income tax liability of one Isidore Wolrich. Naboshek appeared in response to the request but said he had no records or information in his possession, because neither he, personally, nor the firm, but Gurian, had prepared the questioned return and had the records. He asserted that Gurian had ceased to be a member of the firm in 1942 before the preparation of the return under investigation. Gurian had received from Naboshek immediate knowledge of the agent's request.

Respondent argues that the so-called commissioner's summons to appear and produce books and records was illegally issued because 26 U.S.C.A. § 3614(a) does not authorize the issuance of a summons to produce such material. Therefore, says respondent, the order of this court compelling obedience to the summons was without foundation in law.

Respondent misconceives the nature of the procedure employed. Unlike the Collector of Internal Revenue, 26 U.S.C.A. § 3615, the Commissioner has no power of subpoena in his own right. He can merely examine books and records and "require" the attendance of persons having knowledge in the premises. If the party whose attendance is "required" fails to attend, the Commissioner may ask the district court "by appropriate process to compel such attendance, testimony, or production of books, papers, or other data." 26 U.S.C.A. § 3633. A subpoena, subpoena duces tecum, or order to appear and produce is patently an "appropriate process". If it is disregarded, then contempt proceedings may ensue. The Collector, however, does not need the aid of the court to compel attendance or production. If a Collector's summons is disregarded, contempt proceedings may ensue immediately. 26 U.S.C.A. § 3615.

Respondent has shown no more than that it claims not to be a...