Industrial Addition Ass v. Commissioner of Internal Revenue

• Decision Date: 02 January 1945
• Docket Number: No. 118,118
• Citation: 323 U.S. 310,89 L.Ed. 260,65 S.Ct. 289
• Parties: INDUSTRIAL ADDITION ASS'N v. COMMISSIONER OF INTERNAL REVENUE
• Court: U.S. Supreme Court

323 U.S. 310

65 S.Ct. 289

89 L.Ed. 260

INDUSTRIAL ADDITION ASS'N

v COMMISSIONER OF INTERNAL REVENUE.

No. 118.

Argued Dec. 13, 1944.

Decided Jan. 2, 1945.

Mr. F. A. Berry, of Nashville, Tenn., for petitioner.

Mr. Samuel O. Clark, Jr., Asst. Atty. Gen., for respondent.

Mr. Chief Justice STONE delivered the opinion of the Court.

In this case petitioner, deeming itself exempt from income and excess profits taxes, failed to file any tax returns for the years 1932 to 1936, inclusive. The Commissioner assessed petitioner for the taxes for those years, with penalties, and the Tax Court has sustained the assessment as to the income taxes and attendant penalties. Petitioner, within the three months allowed for that purpose by § 1142 of the Internal Revenue Code, 26 U.S.C.A. Int.Rev.Code, § 1142, sought review of the Tax Court's decision by a petition for review filed with the Court of Appeals for the Sixth Circuit.

By § 1141(a) of the Internal Revenue Code, 26 U.S.C.A. Int.Rev.Code, § 1141(a), entitled 'Jurisdiction', the Circuit Courts of Appeals and the Court of Appeals for the District of Columbia are given 'exclusive jurisdiction to review the decisions' of the Tax Court. Subsection (b)(1), entitled 'Venue', provides that 'such decisions may be reviewed by the Circuit Court of Appeals for the circuit in which is located the collector's office to which was made the return of the tax in respect of which the liability arises or, if no return was made, then by the United States Court of Appeals for the District of Columbia.' Since petitioner filed no return, the Court of Appeals for the District of Columbia was the court of proper venue under this subsection. If petitioner had made a return, it would have been required to file it with a collector whose office was within the Sixth Circuit, that of the court below; in that event, that court would have been the court of proper venue. The Code provides further, in subsection (b)(2): 'Notwithstanding the provisions of paragraph 1, such decisions may be reviewed by any circuit court of appeals * * * which may be designated by the Commissioner and the taxpayer by stipulation in writing.'

The Commissioner suggested to petitioner that as it had filed no returns for the years in question and no written stipulation had been entered into as permitted by subsection (b)(2), the Circuit Court of Appeals for the Sixth Circuit was without 'jurisdiction'. In response to this suggestion, petitioner and the Commissioner, after the expiration of the three months' period in which a petition for review could be filed, entered into such a written stipulation, designating the Court the Appeals for the Sixth Circuit as the court to review the decision of the Tax Court. The stipulation reserved to the Commissioner the right to challenge its timeliness and legal effect.

The Court of Appeals for the Sixth Circuit, on the Commissioner's motion, dismissed the petition for review for want of jurisdiction. 141 F.2d 636. We granted certiorari, 323 U.S. 690, 65 S.Ct. 39, to resolve an asserted conflict of the decision below, with that of the Court of Appeals for the Fifth Circuit in Wegener v. Commissioner, 119 F.2d 49. The question presented is whether the court below had jurisdiction of the petition for review of the decision of the Tax Court, notwithstanding petitioner's failure to file the stipulation during the three months period, within which review of the Tax Court's decision could be sought.

The use in juxtaposition, in the statute, of the terms 'jurisdiction' and 'venue' marks a significant distinction. On the one hand, the statute confers power on the Circuit Courts of Appeals generally, to act judicially on petitions for review presented to them—which is 'jurisdiction'. On the other, such of those courts as are specified by the statute, or the stipulation which it authorizes, are designated as the place where, for convenience of the courts or parties or both, the petition will be heard—which is 'venue'.¹ Want of jurisdiction, unlike want of venue, may not be cured by consent of the parties; but when the court has jurisdiction, it has power to decide the case brought before it, even though the court having venue is one sitting in another circuit. General Investment Co. v. Lake Shore Ry., 260 U.S. 261, 272, 273, 43 S.Ct. 106, 111, 112, 67 L.Ed. 244; Burnrite Coal Co. v. Riggs, 274 U.S. 208, 211, 212, 47 S.Ct. 578, 579, 71 L.Ed. 1002; General Electric Co. v. Marvel Co., 287 U.S. 430, 434, 435, 53 S.Ct. 202, 204, 77 L.Ed. 408; Neirbo Co. v. Bethlehem Corp., 308 U.S. 165, 167, 168, 60 S.Ct. 153, 154, 84 L.Ed. 167, 128 A.L.R. 1437; Freeman v. Bee Machine Co., 319 U.S. 448, 453, 63 S.Ct. 1146, 1149, 87 L.Ed. 1509. The right to have a cause heard in the court of the proper venue may be lost unless seasonably asserted; and in that event, the court of trial having jurisdiction but not the proper venue may render a judgment binding on the parties. General Investment Co. v. Lake Shore Ry., supra, 260 U.S. at page 272, 43 S.Ct. at page 111, 67 L.Ed. 244; Commercial Casualty Ins. Co. v. Consolidated Stone Co., 278 U.S. 177, 179, 49 S.Ct. 98, 99, 73 L.Ed. 252; Freeman v. Bee Machine Co., supra, 319 U.S. at page 453, 63 S.Ct. at page 1149, 87 L.Ed. 1509. The government may waive objections to venue, just as any other litigant may, United States v. Hvoslef, 237 U.S. 1, 12, 35 S.Ct. 459, 462, 59 L.Ed. 813, Ann.Cas.1916A, 286; Thames & Mersey Ins. Co. v. United States, 237 U.S. 19, 24, 25, 35 S.Ct. 496, 497, 498, 59 L.Ed. 821, Ann.Cas.1915D, 1087; Peoria & P.U. Railway Co. v. United States, 263 U.S. 528, 535, 536, 44 S.Ct. 194, 196, 197, 68 L.Ed. 427, and here such waiver, by stipulation, is contemplated by § 1141(b)(2).

We have no reason to suppose that the terms 'jurisdiction' and 'venue' were used in the statute in other than their usually accepted meaning, and no convincing reason has been advanced why that meaning should not be accepted here. Unless these plain terms are to be disregarded, all the Circuit Courts of Appeals are given jurisdiction to review decisions of the Tax Court upon a petition for review, that is, power to act judicially upon the petition. Peoria & P.U. Railway Co. v. United States, supra, 263 U.S. at pages 535, 536, 44 S.Ct. at pages 196, 197, 68 L.Ed. 427. Consequently when in this case petitioner filed its petition...