Lone Star Cement Corp. v. State Tax Commission of Alabama, 3 Div. 222
Decision Date | 14 June 1937 |
Docket Number | 3 Div. 222 |
Citation | 234 Ala. 465,175 So. 399 |
Parties | LONE STAR CEMENT CORPORATION et al. v. STATE TAX COMMISSION et al. |
Court | Alabama Supreme Court |
Rehearing Denied June 28, 1937
Appeal from Circuit Court, Montgomery County; Walter B. Jones Judge.
Bill for declaratory judgment by the Lone Star Cement Corporation and others against the State Tax Commission. From a decree favorable to respondent, complainants appeal.
Affirmed.
John S Coleman, Bradley, Baldwin, All & White, Benners, Burr, McKamy & Forman, Cabaniss & Johnston, and Jos. F. Johnston, all of Birmingham, for appellants.
A.A Carmichael, Atty. Gen., B.W. Simmons, Asst. Atty. Gen., H.L Anderton, of Birmingham, E.C. Boswell, of Geneva, and L.H. Ellis, of Columbiana, for appellees.
This appeal is from a declaratory decree interpreting subsections (h) and (i) of section 1, and subsection (k) of section 4 of the Gross Sales Tax Act approved February 23, 1937 (Gen.Acts 1936-37, Ex.Sess., pp. 125, 128), labeled "Alabama Luxury Tax Act."
The bill filed by appellants alleges that they are each engaged in the manufacture of Portland Cement in Jefferson county; that they sell their products to the United States, the state of Alabama, and various counties, cities, and towns, in Alabama, and to contractors who have contracts to build or construct various improvements or structures for said "political entities," and to private contractors, landowners, and other private parties, and to dealers who buy it for resale. That "The great bulk of the cement sold by complainants, except that sold to dealers, is used by the purchasers as an ingredient or component part in manufacturing concrete or mortar, which concrete or mortar is thereafter used by said purchasers in building or constructing roads, streets, highways, embankments, viaducts, bridges, railroads, trestles, foundations, dams, buildings and other things of a similar character." (Italics supplied.)
That prior to filing the bill the State Tax Commission advised complainants that they were liable for the tax levied by said act for cement sold and delivered in Alabama, and used by the purchasers for the purposes included in the above italicized averments, while the complainants asserted that under such conditions they were not liable for the tax for sales so made.
The decree of the circuit court sustained the contention of the tax commission and declares:
"1: That the provisions of the Act of the Legislature of Alabama approved February 23, 1937, levying a tax of two percent of the gross proceeds of sales upon every person, firm or corporation engaged or continuing within this State in the business of selling at retail any tangible personal property whatsoever, apply to sales in the State of Alabama of Portland Cement in carload lots or other quantities to contractors with the United States, the State of Alabama, the counties, cities and towns in the State of Alabama, or to other contractors, or to other private landowners, or to other private parties, where such cement is purchased for use and is used by the purchasers thereof as an ingredient or component part, in the compounding, manufacturing or processing of other tangible property, viz: concrete or mortar, which concrete or mortar when manufactured will be used or employed by such purchasers in connection with the construction or building of roads, streets, highways, embankments, viaducts, bridges, railroads, trestles, foundations, dams, buildings and other things of a similar character, such being transactions as are taxable under the 1937 Alabama Retail Sales Tax Act."
The bill avers, and the answer admits that:
To sustain their contention that the decree is laid in error, appellants contend:
First, that cement sold and used by the purchasers as an ingredient or component part of mortar or concrete is a sale at wholesale within the meaning of section 1, subsection (h) of the act, whether such mortar or concrete is used in the manufacture of an article of "tangible personal property" or is attached to and becomes a part of real estate; second, that cement sold to be used by the purchaser in building roads, bridges, dams, trestles, railroads, viaducts, and similar structures is not "building material" within the meaning of said act; third, that the legislative intent as expressed in subsection (k) of section 4 is to exempt the receipts from all sales of commodities by manufacturers in carload lots from the computation of said tax.
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