United States v. Windle, 13388.

• Decision Date: 04 December 1946
• Docket Number: No. 13388.,13388.
• Citation: 158 F.2d 196
• Parties: UNITED STATES v. WINDLE.
• Court: U.S. Court of Appeals — Eighth Circuit

158 F.2d 196 (1946)

UNITED STATES v. WINDLE.

No. 13388.

Circuit Court of Appeals, Eighth Circuit.

December 4, 1946.

William R. Sheridan, Asst. U. S. Atty., of Keokuk, Iowa (Maurice F. Donegan, U. S. Atty., of Davenport, Iowa, on the brief), for appellant.

Carl H. Lambach, of Davenport, Iowa, for appellee.

Before GARDNER, SANBORN, and WOODROUGH, Circuit Judges.

WOODROUGH, Circuit Judge.

The United States filed libel for forfeiture of a 1940 Dodge coupe automobile and its contents, consisting of approximately 48 gallons of whiskey, because of the intended use of the automobile and its contents in violation of internal revenue laws relating to selling distilled spirits at wholesale without paying the special tax applicable to a wholesale liquor dealer and without keeping required records. James C. Windle intervened and filed an answer claiming ownership of the seized property. The answer was treated as a motion to dismiss or a demurrer and the case was submitted on the pleadings. The District Court entered an order dismissing the automobile from the libel and ordering its return to intervener, and the United States has appealed.

The libel presents that at the time the automobile and liquor were seized by an agent of the Alcohol Tax Unit they were owned and possessed by Windle, and that he held the liquor in the car with intention to use it in violation of internal revenue laws, contrary to 26 U.S.C.A. Int.Rev.Code, § 3116, and further states that for a long period of time prior to the seizure Windle had been unlawfully carrying on the business of a wholesale liquor dealer and had sold and offered for sale distilled spirits in quantities of five wine gallons or more to the same person at the same time, without paying the special wholesale liquor dealer's tax required by law, and without rendering under oath to the District Supervisor of the Alcohol Tax Unit, correct transcripts and summaries of records required under internal revenue laws and regulations promulgated thereunder.

While the libel states that the distilled spirits were at the time of seizure being offered for sale in violation of 26 U.S.C.A. Int.Rev.Code, § 3253, it further states that the liquor and automobile became forfeited to the United States under 26 U.S.C.A. Int.Rev.Code, § 3116, and the allegations of the libel are sufficient to invoke the forfeiture provisions of § 3116 if they are applicable to the facts presented. 26 U.S.C.A. Int.Rev.Code, § 3253 provides.

"Penalities and forfeitures for nonpayment of special tax.

"Any person who shall carry on the business of a brewer, rectifier, wholesale liquor dealer, retail liquor dealer, wholesale dealer in malt liquors, retail dealer in malt liquors, or manufacturer of stills, and willfully fails to pay the special tax as required by law, shall, for every such offense, be fined not less than $100 nor more than $5,000 and be imprisoned for not less than thirty days nor more than two years. And all distilled spirits or wines, and all stills or other apparatus, fit or intended to be used for the distillation or rectification of spirits, or for the compounding of liquors, owned by such person, wherever found, and all distilled spirits or wines and personal property found in the distillery or rectifying establishment, or in any building, room, yard, or enclosure connected therewith and used with or constituting a part of the premises, shall be forfeited to the United States. 53 Stat. 391."

26 U.S.C.A. Int.Rev.Code, § 3116 provides:

"Forfeitures and seizures.

"It shall be unlawful to have or possess any liquor or property intended for use in violating the provisions of this part, or the internal-revenue laws, or regulations prescribed under such part or laws, or which has been so used, and no property rights shall exist in any such liquor or property. A seach warrant may issue as provided in title XI of the Act of June 15, 1917, 40 Stat. 228 (U.S.C. Title 18, §§ 611-633), for the seizure of such liquor or property. Nothing in this section shall in any manner limit or affect any criminal or forfeiture provision of the internal-revenue laws, or of any other law. The seizure and forfeiture of any liquor or property under the provisions of this part, and the disposition of such liquor or property subsequent to seizure and forfeiture, or the disposition of the proceeds from the sale of such liquor or property, shall be in accordance with existing laws or those hereafter in existence relating to seizures, forfeitures, and disposition of property or proceeds, for violation of the internal-revenue laws. 53 Stat. 362."

The District Court in dismissing the automobile from the libel and ordering its return to intervener held that 26 U.S.C.A. Int.Rev.Code, § 3253 was a special statute applicable to a particular violation and that since it did not specifically provide for forfeiture of a vehicle used in connection with carrying on the business of wholesale liquor dealer without payment of the special occupational tax required by law, no forfeiture of a vehicle could be based thereon, and that 26 U.S.C.A. Int.Rev.Code, § 3116, was a general statute and was inoperative in connection with a violation contemplated by Sec. 3253.

As the libel was drawn under Section 3116, the sole question is whether the District Court erred in holding that the general provisions of Section 3116 were inapplicable to the facts of the case.

We have recognized the applicability of 26 U.S.C.A. Int.Rev.Code, § 3116 in the case of a forfeiture of liquor found in possession of one engaged as a wholesale liquor dealer without having paid the special tax. In Seib v. United States, 8 Cir., 150 F.2d 673, 675, one count was based on 26 U.S.C.A. Int.Rev.Code, § 3253 and one count was drawn under Sec. 3116. Intervener therein contended that Sec. 3253 did not authorize forfeiture of liquor found in possession of one unlawfully engaged as a wholesale liquor dealer without having paid the applicable special tax. In disposing of this contention we said:

"We think the section Sec. 3253 expresses the intent of Congress to provide for the forfeiture of distilled spirits in the possession of one engaged as a wholesale liquor dealer without having paid the special tax required by the Revenue Laws of the United States, as well as for the forfeiture of such liquors in the hands of rectifiers who have failed to pay...