Remington Rand v. Gage, 3925.

• Decision Date: 12 July 1933
• Docket Number: No. 3925.,3925.
• Citation: 4 F. Supp. 199
• Parties: REMINGTON-RAND, Inc., v. GAGE, Collector of Internal Revenue.
• Court: U.S. District Court — Western District of New York

4 F. Supp. 199

REMINGTON-RAND, Inc., v. GAGE, Collector of Internal Revenue.

No. 3925.

District Court, W. D. New York.

July 12, 1933.

Franchot & Warren, of Buffalo, N. Y. (W. C. Warren, Jr., and Gibson Gardner, both of Buffalo, N. Y., of counsel), for plaintiff.

Richard H. Templeton, U. S. Atty., of Buffalo, N. Y. (Harold B. Ehrlich, Asst. U. S. Atty., of Buffalo, N. Y., and C. M. Charest, Gen. Counsel, and Ralph E. Updike, Sp. Atty., Bureau of Internal Revenue, both of Washington, D. C., of counsel), for defendant.

ADLER, District Judge.

This is an action brought by Remington-Rand, Inc., for the recovery of manufacturer's excise tax paid by the Rand Company, Inc., for the period July 3, 1924, to September 30, 1925, in the amount of $6,237.88, and the sum of $2,312.38 paid by the Rand Cardex Company, Inc., for the period September 30, 1925, to February, 1926, making a total amount assessed of $8,550.26, together with interest thereon.

The principal question involved in this case is whether or not the automatic player piano sold by the Rand Company is subject to taxation as a coin-operated device under the provisions of section 600 of the Revenue Act of 1924 (26 USCA § 881 note). A further question involved is whether the Remington-Rand, Inc., succeeded to the claims of its predecessor companies.

Recent acts of Congress providing for excise taxes applicable to this case were passed in 1918, 1921, and 1924. The Revenue Act of 1918, § 900 (40 Stat. 1122), provides for a tax on (4) pianos, organs (other than pipe organs), piano players, graphophones, phonographs, talking machines, music boxes, and records used in connection with any musical instruments, piano players, graphophones, phonographs, or talking machines. Paragraph 16 provides for a tax upon automatic slot device vending machines, etc. This act of 1918 was superseded by the Revenue Act of 1921 (section 900 42 Stat. 291), which omitted paragraph (4) of the 1918 act on pianos, etc., and retained the tax on automatic slot device vending machines using the same language in paragraph 11 of the 1921 act as was used in paragraph 16 of the 1918 act. The Revenue Act of 1921 was in turn superseded by the Revenue Act of 1924, which is in substantially the same language as the act of 1921, with the single exception that, instead of using the words "automatic slot-device vending machines," the Revenue Act of 1924 has changed the language to "coin-operated devices, coin-operated machines, and devices and machines operated by any substitute for a coin." It is under the Revenue Act of 1924 that the tax was levied in this case. The history of the legislation is pertinent in determining whether the player piano manufactured and sold by the plaintiff is taxable under the 1924 act.

It is clear that it was the intention of Congress in passing the Revenue Act of 1921 to remove from taxation under that act musical instruments which were taxed under paragraph 4 of the 1918 act. Paragraph 4 of the 1918 act made no reference to slot devices in connection with musical instruments. Paragraph 16 of the 1918 act taxing "automatic slot-device vending machines" was retained with the same language in the 1921 act.

The case of Seeburg Piano Company v. United States, reported in 62 Ct. Cl. page 281, was decided under the Revenue Act of 1921. It was there held that an electrical piano operated upon the deposit of a coin in a slot provided for that purpose is not a slot device vending machine within the meaning of paragraph 11 of that act. The opinion in that case,...