Tucker v. Alexander, 167

• Decision Date: 21 November 1927
• Docket Number: No. 167,167
• Citation: 275 U.S. 228,72 L.Ed. 253,48 S.Ct. 45
• Parties: TUCKER v. ALEXANDER, Collector of Internal Revenue
• Court: U.S. Supreme Court

275 U.S. 228

48 S.Ct. 45

72 L.Ed. 253

TUCKER

v ALEXANDER, Collector of Internal Revenue.

No. 167.

Argued Oct. 7, 1927.

Decided Nov. 21, 1927.

Mr. Charles H. Garnett, of Oklahoma City, Okl., for petitioner.

The Attorney General and Mr. Solicitor General Mitchell, of Washington, D. C., for respondent.

Mr. Justice STONE delivered the opinion of the Court.

Petitioner, from March 1, 1913, and in 1920, was the owner of shares of stock in a corporation which in the latter year was dissolved and liquidated. A distribution of some portion of its assets to the stockholders had been made in May, 1913. The Commissioner of Internal Revenue taxed as income on dissolution the difference between the value of the property received by petitioner as a liquidating dividend, and the value of his stock on March 1, 1913, less the value of the distribution of May, 1913, which was treated as a return of capital. Petitioner paid the tax under protest, setting up that it was excessive, and after filing a claim for refund brought the present suit in the District Court for Western Oklahoma to recover the excess. In his claim for refund petitioner assigned as reasons for it (1) the Commissioner's erroneous computation of the value of the stock on March 1, 1913, and (2) his failure to deduct duct from the capital and surplus of the company at the date of liquidation the amount of certain outstanding debts which were assumed by the stockholders, but no explicit statement was made that the Commissioner had erred in decreasing the March 1, 1913, value by the value of the property distributed in May, 1913, nor was that point raised by the petition in the district court which in effect merely repeated the allegations of the claim for refund.

In the course of the trial petitioner without objection by the government abandoned the grounds of recovery stated in the petition and attacked only the Commissioner's deduction of the return of capital from the March 1, 1913, value. That issue alone was litigated. At the close of the trial counsel stipulated that, if the court found the deduction to have been erroneously made, the petitioner should have judgment in the sum named. The District Court's judgment for petitioner was reversed by the Circuit Court of Appeals for the Eighth Circuit (15 F.(2d) 356) which held that a recovery on grounds different from those set up in the claim for refund was precluded by section 3226 of the Revised Statutes as amended by section 1014 of the Revenue Act of 1924 (chapter 234, 43 Stat. 253, 343; U. S. C. tit. 26, § 156 (26 USCA § 156; Comp. St. § 5949)). The case was brought here on certiorari to review this determination. 273 U. S. 689, 47 S. Ct. 459, 71 L. Ed. 841.

Section 3226 provides that:

'No suit or proceeding shall be maintained * * * for the recovery of any internal revenue tax alleged to have been erroneously or illegally assessed or collected * * * until a claim for refund or credit has been duly filed with the Commissioner of Internal Revenue, according to the provisions of law in that regard, and the regulations of the Secretary of the Treasury established in pursuance thereof. * * *'

And article 1036 of Treasury Regulations No. 45 (1920 Ed.), in force when the claim for refund was filed, requires that such claims 'shall be made on form 46 (revised),' and that 'all the facts relied upon in support of the claim shall be clearly set forth under oath.' In the form referred to a space was provided for the claimant to set out the reasons why his application should...