Owens-Illinois Glass Co. v. Battle, OWENS-ILLINOIS

• Court: Supreme Court of West Virginia
• Citation: 154 S.E.2d 854,151 W.Va. 655
• Decision Date: 06 June 1967
• Docket Number: No. 12616,OWENS-ILLINOIS
• Parties: GLASS COMPANY et al. v. G. Thomas BATTLE, Tax Commissioner, etc.

Page 854

154 S.E.2d 854 151 W.Va. 655 OWENS-ILLINOIS GLASS COMPANY et al.
v.
G. Thomas BATTLE, Tax Commissioner, etc. No. 12616. Supreme Court of Appeals of West Virginia. Submitted May 2, 1967.
Decided June 6, 1967.

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Syllabus by the Court

1. Statutes relating to the same subject matter, whether enacted at the same time or at different times, and regardless of whether the later statute refers to the former statute, are to be read and applied together as a single statute the parts of which had been enacted at the same time.

2. When statutory provisions, properly read and considered In pari materia, are clear and unambiguous, there is no basis for application of rules of statutory construction, but courts must apply such statutory provisions according to the legislative intent plainly expressed therein.

3. Where a person claims an exemption from a law imposing a tax, such law must be construed strictly against the person claiming the exemption.

4. In a case in which one judge of this Court was disqualified to participate and in which only two of the remaining four judges were of the opinion to reverse the judgment of the trial court, such judgment, by reason of the provisions of Section 4, Article VIII of the Constitution of West Virginia and Code, 1931, 58--5--20, was affirmed but the decision of the Court in such circumstances shall not be considered as binding authority upon any of the inferior courts of this state, except in that particular case.

[151 W.Va. 656] 5. Where two taxpayers are severally engaged in businesses of manufacturing articles for sale, profit or commercial use and are also jointly engaged in the business of producing natural gas for use and consumption in the operation of their manufacturing plants, they are required, under the provisions of Article 13, Chapter 11, Code, 1931, as amended, to pay a gross sales tax, at the rate prescribed by Section 2a of said Article 13, on the basis of the gross volume of the natural gas produced, including the relatively small portion thereof which is used and consumed in the process of producing the natural gas and which relatively small portion is, therefore, not used and consumed in the operation of the taxpayers' manufacturing plants.

Stone, Mauzy, Bowles & Kauffelt, T. D. Kauffelt, A. G. Stone, Charleston, for appellants.

C. Donald Robertson, Atty. Gen., James G. Anderson, III, Asst. Atty. Gen., Charleston, for appellee.

CALHOUN, President:

This case, on appeal from the Circuit Court of Kanawha County, involves a declaratory judgment proceeding in which that court upheld the action of the State Tax Commissioner in refusing a claim for refund of certain business and occupation taxes for 1955, 1956 and 1957 which had been paid by Owens-Illinois Glass Company, a corporation, and Libbey-Owens-Ford Glass Company, a corporation, which corporations may be referred to hereafter in this opinion merely as the taxpayers.

During the tax years in question, the two taxpayers severally operated manufacturing plants in Kanawha and Cabell Counties. During that period of time, they were engaged jointly in the production of natural gas [151 W.Va. 657] for use in the operation of their respective manufacturing plants. The taxes of which they seek a refund are a portion of the total business and occupation taxes paid by them in connection with their joint activity in the production of natural gas.

In the circuit court, the case was submitted for decision upon a stipulation of all pertinent facts. In this Court, the case has been submitted for decision on the record made in the circuit court, including the stipulation of all material facts, and upon briefs and oral argument of counsel. The basic question for decision is whether, under

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applicable statutory provisions, the taxes were properly collected and paid.

All the natural gas produced jointly by the taxpayers was used and consumed by them in the operation of their respective manufacturing plants, except a relatively small portion of such gas which was used and consumed in the operation of the gas production facilities, especially in the operation of compressor plants and equipment which were necessary in the extraction of the gas from the producing sands and wells. The taxpayers, for the tax years in question, paid taxes on the basis of the total volume of gas jointly produced by them. The taxes for which a refund is sought in this case, amounting to $3,134.85, represent the portion of taxes which were paid on the volume of the gas which was used and consumed in the process of producing gas and which, therefore, was not used and consumed in the operation of the manufacturing plants.

The business and occupation tax and the rates thereof are established by the provisions of Article 13 of Chapter 11, Code, 1931, as amended. Statutes relating to the same subject, regardless of the time of their enactment and whether the later statute refers to the former statute, are to be read and construed together and considered as a single statute the parts of which had been enacted at the same time. Delardas v. Morgantown Water Commission, 148 W.Va. 776, pt. 1 syl., [151 W.Va. 658] 137 S.E.2d 426; Chesapeake and Potomac Telephone Co. of West Virginia v. City of Morgantown, 144 W.Va. 149, pt. 4 syl., 107 S.E.2d 489. This legal principle is applicable to the provisions of Article 13 referred to above.

The history of the business and occupation statutes was traced and the character of the tax was defined in Soto, Tax Commissioner v. Hope Natural Gas Co., 142 W.Va. 373, 95 S.E.2d 769. In that case, the Court pointed out that a business and occupation tax levied upon the production of natural gas or other natural products is a privilege tax, not a 'production tax' or a 'severance tax' in the sense of a tax levied on 'each ton of coal, each barrel of oil, or each m.c.f. of gas' produced. To the same effect see Cole v. Pond Fork Oil & Gas Co., 127 W.Va. 762, 776, 35 S.E.2d 25, 32, 160 A.L.R. 970. In the Soto case, the Court stated in the second point of the syllabus that the measure of the tax upon the privilege of producing for sale, profit or commercial use any natural resource product 'is the value of the article produced' at the point where production ends.

In J. D. Moore, Inc. v. Hardesty, State Tax Commissioner, 147 W.Va. 611, 129 S.E.2d 722, the court held that a single integrated business may be separated by the state tax commissioner into its component parts for purposes of taxation at different rates...