Paul Heuring Motors, Inc. v. State Bd. of Tax Com'rs, No. 45T10-9206-TA-00042

• Docket Nº: No. 45T10-9206-TA-00042
• Citation: 620 N.E.2d 39
• Case Date: September 14, 1993
• Court: Tax Court of Indiana

Page 39

620 N.E.2d 39 PAUL HEURING MOTORS, INC., Petitioner,
v.
STATE BOARD OF TAX COMMISSIONERS, Respondent. No. 45T10-9206-TA-00042. Tax Court of Indiana. Sept. 14, 1993.

Page 40

Joseph S. Van Bokkelen, Goodman Ball & Van Bokkelen, Highland, for petitioner.

Pamela Carter, Atty. Gen., Joel Schiff, Deputy Atty. Gen., Indianapolis, for respondent.

FISHER, Judge.

The Petitioner, Paul Heuring Motors, Inc. (Heuring), appeals the final determination of the Respondent, the State Board of Tax Commissioners (the State Board), assessing Heuring's business personal property for the March 1, 1991, assessment.

FACTS

Heuring, an Indiana corporation with its principal place of business in Hobart Township, Lake County, operates an automobile dealership. Heuring sells both new Ford automobiles and trucks in addition to used vehicles.

On or about February 26, 1991, Heuring moved fewer than half of its vehicles to a lot in Porter County for a special sale. During the sale, Heuring placed sale advertisements in the Porter County newspapers and paid rent to the owner of the lot. Heuring returned the unsold vehicles to Lake County approximately five days later, on or about March 3, 1991.

Heuring filed property tax returns with the officials in both Lake County and Porter County, reflecting the inventory in each location on March 1, 1991. The State Board conducted an audit of Heuring in January 1992. It concluded that Heuring had not obtained a taxable situs in Porter County and that all the inventory reported there should have been reported in Lake County. Consequently, the State Board determined Heuring had under-reported its inventory by more than five percent (5%) in Lake County and it assessed a twenty percent (20%) penalty pursuant to IND.CODE 6-1.1-37-7(e). Additional facts will be supplied as necessary.

ISSUE

Whether the State Board acted arbitrarily and capriciously in assessing a twenty percent (20%) undervaluation penalty under IC 6-1.1-37-7(e) for the value of the vehicles which Heuring reported for assessment in Portage Township, Porter County.

DISCUSSION AND DECISION

The State Board is accorded great deference when acting within the scope of its authority, and the Tax Court will reverse the State Board's final determination only when it is unsupported by substantial evidence, constitutes abuse of discretion, exceeds statutory authority, or is arbitrary or capricious. Wirth v. State Bd. of Tax Comm'rs (1993), Ind.Tax, 613 N.E.2d 874, 876 (citing Centrium Group v. State Bd. of Tax Comm'rs (1992), Ind.Tax, 599 N.E.2d 242, 243 and Hatcher v. State Bd. of Tax Comm'rs (1992), Ind.Tax, 601

Page 41

N.E.2d 19, 20). Like any other party appealing an administrative decision, the taxpayer bears the burden to show the State Board's assessment was inaccurate. Meridian Hills Country Club v. State Bd. of Tax Comm'rs (1987), Ind.Tax, 512 N.E.2d 911, 913.

I.

Heuring contends it should not be penalized for undervaluing its property because it reported all of its property, albeit in two different counties. Rather, Heuring argues an interpretive difference existed concerning the proper county for assessment. "Except as otherwise provided by law, all tangible property which is within the jurisdiction of this state on the assessment date of a year is subject to assessment and taxation for that year." IND.CODE 6-1.1-2-1. IND.CODE 6-1.1-3-1 provides for the place of assessment:

(a) Except as provided in subsection (c) of this section, personal property which is owned by a person ¹ who is a resident of this state shall be assessed at the place where the owner resides on the assessment date of the year for which the assessment is made.

. . . . .

(c) Personal property shall be assessed at the place where it is situated on the assessment date of the year for which the assessment is made if the property is:

(1) regularly used or permanently located where it is situated....

IC 6-1.1-3-1 (footnote added). Therefore, unless the property in question falls within subsection (c), personal property owned by an Indiana resident must be assessed where the owner resides. The general rule is that a corporation's domicile or residence, within the state of its creation, is in the county and city, town, or district in which its principal office or place of business is located, Flournoy v. McKinnon Ford Sales (1974), 90 Nev. 119, 121, 520 P.2d 600, 601-02, as designated in its charter or certificate of incorporation, Mavity v. First of Georgia Ins. Co. (1967), 115 Ga.App. 763, 156...