Maxwell v. Hinsdale

• Decision Date: 19 September 1934
• Docket Number: No. 738.,738.
• Citation: 207 N.C. 37,175 S.E. 847
• Court: North Carolina Supreme Court
• Parties: MAXWELL, Commissioner of Revenue. v. HINSDALE et al.

175 S.E. 847

207 N.C. 37

MAXWELL, Commissioner of Revenue.

v.HINSDALE et al.

No. 738.

Supreme Court of North Carolina.

Sept. 19, 1934.

Appeal from Superior Court, Alamance County; Devin, Judge.

Civil action by the State, on the relation of A. J. Maxwell, Commissioner of Revenue, against S. J. Hinsdale and others, trustees in bankruptcy of the Central Loan & Trust Company, bankrupt.From a judgment affirming a ruling of the Commissioner of Revenue, the defendants appeal.

Affirmed.

The Central Loan & Trust Company paid income taxes to the state of North Carolina as follows: From December 1, 1922, to November 30, 1923, $1,305.40; from December 1, 1923, to November 30, 1924, $1,243.77; from December 1, 1924, to November 30, 1925, $1,502.63.

The taxpayer thereafter became a bankrupt, and the trustees of said bankrupt asserted that they were entitled to a refund of taxes for said years by reason of the fact that in the return of the taxpayer there was "erroneously included as income the annual appreciation of unsold real estate over cost price.This statement was made in return filed with the Commissioner of Revenue for the State of North Carolina and the erroneous tax was paid to said Commissioner."

On December 3, 1929, the federal government redetermined the taxes due "by said bankrupt for said years and made refund of federal taxes erroneously collected because of a like erroneous overstatement in the return made to the Federal Government."More than two years thereafter, to wit, on the 30th day of December, 1932, the bankrupt, through its trustees, "filed with the Commissioner of Revenue for the State of North Carolina * * * claims for a refund of taxes paid by the Central Loan & Trust Company."It was stipulated "that there was no return oath made to the Commissioner of Revenue after the redetermination made by the Federal Government until December 30, 1932.

The commissioner of revenue declined to order the refund and rejected the claim, asserting that on account of the lapse of time all records "pertaining to the years at issue were, under authority of statute, destroyed, " etc.The taxpayer appealed from the ruling of the revenue commissioner to the judge of the superior court, who disallowed the claim and affirmed the ruling of the revenue commissioner.Thereupon the trustees in bankruptcy appealed to the Supreme Court.

Edwin Martenet, of Greensboro, for trustees in bankruptcy.

Dennis G. Brummitt, Atty. Gen., and A. A. F. Seawell and T. W. Bruton, Asst. Attys.Gen., for Commissioner of Revenue.

BROGDEN, Justice.

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