Petition for a Writ of Certiorari — Fuhrman & Forster Co. v. Commissioner

IN THE

Supreme Court of the United States

Ocroser Term, A. D. 1940.

we

No. @

FUHRMAN & FORSTER COMPANY,

Petitioner,

vs,

COMMISSIONER OF INTERNAL REVENUE,

Respondent.

—— oe

PETITION FOR WRIT OF CERTIORARI TO THE

UNITED STATES CIRCUIT COURT OF APPEALS

FOR THE SEVENTH CIRCUIT AND BRIEF IN SUP-

PORT THEREOF.

RayForp W. LeMtey,

Attorney for Petitioner.

THE GUNTHORP. WA RREN PRINTING COMPANY, 210 WEST JACKSON, CHICAGO

INDEX.

Pace

Petition for a Writ of Certiorari to the Circuit Court

of Appeals for the Seventh Circuit............... 2

Statement of the Matter Involved.............. 2

Decision of the Circuit Court of Appeals........ 5

Reasons Relied Upon for Allowance of Writ..... 6

Brief in Support of Petition for Writ of Certiorari... 15

PIE oe cack ya ee ENED RAL a RG as cobes 15

et re rere nr re 16

PRUE OE PTORG ios oh ses Coes necicd coebs 18

Argument:

I. The Petitioner Was the Taxpayer Upon

Whom the Processing Tax Was Im-

posed Within the Intendment of the Ag-

ricultural Adjustment Act ........... 19

II. Petitioner Is a Proper Claimant Under the

Provisions of Title VII of the Revenue

Act of 1936 and the United States Proc-

essing Tax Board of Review Had Ju-

risdiction to Entertain This Proceeding 39

III. The Decision of the Circuit Court of Ap-

peals Will Result in Confusion and

Concomitant Hardship Upon Petitioner

in Connection With the Tax on Unjust

Enrichment Provided by Title III of

the Revenue Act of 1936. That Act

Recognizes Only a Processor and a

Vendee. What Is the Position of Peti-

tioner Thereunder? ................. 49

ii

Cases CITeEb.

Anniston Mfg. Co. v. Davis, 301 U. S. 337............ 11

Arabi Packing Co., Inc., 60 S. Ct. 1093.............. 10

Bankers Trust Co., et al. v. Bowers, 295 Fed. 89...... 34

Bird v. Grant (Also Tritt v. Grant), 94 N. Y. Supp. 127 34

Carbon Steel Co. v. Lwellyn, 251 U. S. 501........... g

moe. Gt, Se ee. cece 13

Detroit Hotel v. Brady, 275 Fed. 995................ 12

pees w. Deen, ee a. Oe 08... ok. ce. cue. 13

F & F Laboratories v. Commissioner, 104 Fed. (2d)

ME Wa aS vhs Cebbnad Wek Gah FG Obak bag ekki 52

Grier v. Kennan, 64 Fed. (2d) 605.................. 12

Gulf C. & F. S. R. T. Co. v. Ellis, 165 U. S. 150....... 12

en: e. Tos, De ee, GOB... oS 12

Knickerbocker Trust Co. v. Meyers, 133 Fed. 764..... 13

Knowlton v. Moore, 178 U. 8. 41.................... 11

Lukas v. Kentucky Distilleries & Warehouse Co., 70

UR I I ono ac a iknds Wei can se ccc cuticad 9, 38

Merrill v. Yeomans, 94 U. S. 568.................... 22

Nordberg v. U. S., 51 Fed. (2d) 271................. 24

Oswald Jeager Baking Co. v. Commissioner, 108 Fed.

ei hE 0k so eee kG oss oy iene dee 52

Seigel v. U. S., 18 Fed. (Supp.) 771................. 12

Stahmann, et al. v. Vidal, 59 S. Ct. 41................ 9, 26

Stewart Dry Goods Co. v. Lewis, 294 U. S. 553....... 12

Trunz Pork Stores, Inc. v. Rasquin, 100 Fed. (2d) 399.6, 53

oe ee 8S Fe reer een aes 50

Warner-Patterson Co. v. U. S., 68 Ct. of Cl. 287...... 9

White v. Hopkins, 51 Fed. (2d) 159................. 9, 40

Zinsmaster Baking Co. v. Commissioner, 109 Fed. (2d)

PO naked ewe cle ch wanna ban beined coset 52

iii

STATUTES :

Revenue Act of 1936, 49 Stat. 1648:

Section 901 (U. S. C. Supp. IV, Title 7, Sec. 623) 44 ‘

Section 902 (U.S. C. Supp, IV, Title 7, Sec. 644) 43 i

Section 903 (U.S. C. Supp. IV, Title 7, Sec. 645) 44 é

Section 905 (U. S. C. Supp. IV, Title 7, Sec. 647) 44

Section 906 (U. 8. C. Supp. IV, Title 7, See. 648) i

hceaadteratoddeses eel suad el macticikin 43, 45 /

Section 907 (U. S. C. Supp. IV, Title 7, Sec. 649)

PO a) a an eer a” RTC EE 43, 47 ‘

Section 913 (U. S. C. Supp. IV, Title 7, Sec. 655) ;

PUMA EK Wea Saks mde Gus CKR DA Oo wads Keke 41, 45

Agricultural Adjustment Act, c. 25, 48 Stat. 31:

Section 9 (U.S. C., Title 7, Sec. 609)...... 21, 22, 24

Section 15 (U.S. C., Title 7, Sec. 615)......... 31

Section 21 (U.S. C., Title 12, Sec. 992)........ 13

Public Act No. 10, 73rd Congress, Approved

8. BPs Garter 21

Pubie Act No. 213, 73rd Congress, Approved

ME Cie ve a<cavecabes op kceeascawee 22, 27

Public Act No. 320, 74th Congress, Approved

BE Sk, Eb veer ea cr ksh as iene side vas 24

Public Act No. 476, 73rd Congress, Approved

ME IE Weenie Coa nein eee shee kos dbo maws 22

Bankhead Cotton Act of 1934 .................. 25

Second Deficiency Appropriation Act of 1938.... 43

iv

MISCELLANEOUS:

Treasury Department:

Decision No. 4403, Approved November 2, 1933. 30

Decision No. 4406, Approved November 11, 1933

Decision No. 4518, Approved January 25, 1935. 24

SE WE kok sas Weada co can bed Reaves 28

Ce ee rere ere ery ee eee 21

Cumulative Bulletin XITI-1, January-June 1934

(Internal Revenue Bulletin No. 20) ......... 8, 29

Department of Agriculture:

Cotton Regulations, Series 2, Supplement 2, Ap-

proved November 29, 1933 ................. 26

Hog Regulations, Series 1, Approved October

WN Sh ess es ee 93

Hog Regulations, Series 1, Supplement 1, Ap-

proved October 20, 1904 ... 2.0... cc eccsees

Jute Regulations, Series 1 ..................

Paper Regulations, Series 1 ..................

Supplemental Certificate, dated July 7, 1934....

Tobacco Regulations, Series 1 ................

Congressional Record:

Volume 77, pages 671-766, 786, 1350, 1562-65...

IN THE

Supreme Court of the United States

Ocroser Term, A. D. 1940.

No.

FUHRMAN & FORSTER COMPANY,

Petitioner,

vs,

COMMISSIONER OF INTERNAL REVENUE,

Respondent.

PETITION FOR WRIT OF CERTIORARI TO THE

UNITED STATES CIRCUIT COURT OF APPEALS

FOR THE SEVENTH CIRCUIT AND BRIEF IN SUP-

PORT THEREOF.

Your petitioner, Fuhrman & Forster Company, respect-

fully prays for the allowance of a writ of certiorari to the

United States Circuit Court of Appeals for the Seventh

Cireuit to review the decision of that court entered in the

above case on July 22, 1940. A petition for rehearing was

denied by that court on October 1, 1940.

——

STATEMENT OF THE MATTER INVOLVED.

This proceeding involves a claim for refund of $260,-

075.15 paid as processing taxes under the Agricultura]

Adjustment Act. (¢. 25, 48 Stat. 31). A part of the

amount in controversy was paid by petitioner directly to

the United States, pursuant to a demand by the Collector

of Internal Revenue, Chicago, Illinois (hereafter referred

to as the Collector). The larger balance was paid, as di-

rected by the United States, to C. A. Burnette Company,

a public abattoir, whom petitioner had engaged to slaughter

its hogs for a fee, who in turn remitted this money to the

Collector.

After this Court had held the Agricultural Adjustment

Act unconstitutional, Congress attempted to provide an

exclusive remedy for the refunding of the processing taxes

illegally exacted. The remedial statute was known as

Title VII of the Revenue Act of 1936 (c. 690, 49 Stat.

1648, 1750. I. R. C. 507-15), hereafter referred to as Title

VII.

Petitioner duly filed its claim for refund (P. T. Form 79)

with the Collector on June 30, 1937. On June 3, 1938, the

Commissioner of Internal Revenue (hereafter referred to

as the Commissioner or the Respondent) rejected this

claim in full under the theory that petitioner was not such

a person (processor or taxpayer) to whom Title VII au-

thorized a refund. (R. 9.) None of the taxes in con-

troversy have been refunded.

A petition for review was filed with the United States

Processing Tax Board of Review (hereafter referred to

as the Board) on September 1, 1938. (R. 3.) The Board

entered its first order of dismissal for want of jurisdiction

on February 23, 1939, three members of the Board dis-

senting thereto. (R. 52.)

3

Qn April 24, 1939, an amended petition was filed by

your petitioner. (R. 42.) The Board vacated its order of

dismissal on May 11, 1939. (R. 53.) Respondent again

fled a motion to dismiss, and again the Board entered an

order of dismissal on September 28, 1939. (R. 53.) To

the last order, three members of the Board again dis-

sented, expressing the view that the Board had jurisdic-

tion to entertain that proceeding. (Memorandum opinions,

R. 54, 55, 56, and 57.)

The case was brought to the United States Cireuit Court

of Appeals for the Seventh Circuit by a petition for re-

view, filed December 26, 1939, pursuant to Section 906 (g)

of Title VII of the Revenue Act of 1936.

On December 26, 1939, three other petitions for review

were filed with the United States Circuit Court of Appeals

for the Seventh Cireuit, identified as Vette & Zuncker

Company, Ine., Docket No. 7173; United Butchers Packing

Company, Docket No. 7174; and Zuegel Packing Company,

Docket No. 7175. As all of the foregoing cases were

_ virtually identical with that of Fuhrman & Forster Com-

pany, and all represented by the same attorney, the United

States Circuit Court of Appeals for the Seventh Circuit,

upon motion duly made, ordered that its decision in the

case of Fuhrman & Forster Company, petitioner on re-

view, would be held controlling in all of the other three

cases. (R. 82.)

A motion for a stay of mandate in the other three cases

will be duly filed with the Circuit Court of Appeals, pend-

ing the decision of this Court in this proceeding.

The decision of the Board, dismissing the petition for

lack of jurisdiction, affirmed by the Circuit Court of Ap-

peals, leads to the conclusion that no person has a legal

right to recover the processing tax in controversy. The

public abattoir may not recover because it bore no part of

the burden of this tax, and petitioner may not recover,

even if it bore the full burden thereof, because it was not

4

the taxpayer, nor the person upon whom the tax was im-

posed.

The petitioner takes the position that it was the taxpayer

upon whom the processing tax was imposed under the

Agricultural Adjustment Act, and, having paid part of the

taxes in controversy directly to the United States, and

the balance directly to the ‘‘collection agent”’ specified by

an officer of the United States, that it is entitled under

the law to a recovery, at least to the extent of the tax

burden borne by it and not shifted to others.

Petitioner also takes the position that whether or not it

was the taxpayer who was obliged to pay the tax imposed

under the Agricultural Adjustment Act, it was a proper

claimant under Title VII, as Congress clearly intended a

remedy to those who immediately bore the burden of the

tax prior to the first movement of the taxed commodity

by a sale thereof into the channels of trade. Therefore,

if a public abattoir was the taxpayer, both the agent and

the owner have a right of recovery under the Act to the

extent of the tax burden borne.

Therefore, whether as taxpayer or the one who actually

paid the tax before the commodity moved into the chan-

nels of trade, the Board had jurisdiction to entertain this

proceeding in its entirety if Title VII, a remedial statute,

is liberally and equitably construed.

Petitioner believes that it has presented to the Board

and the courts, for the first time, the error of the Respond-

ent occurring early in 1934, which was the beginning of a

chain of events that has caused great, but avoidable, hard-

ship to petitioner and others similarly cireumstanced.

The problem here has become involved solely as a result

of a super-structure built upon the alleged false founda-

tion of an improper administrative ruling. The prob-

ability is that greater damage must follow until the rights

of the parties have been determined by a decision of this

Court.

a

DECISION OF THE CIRCUIT COURT OF APPEALS.

The decision of the United States Cireuit Court of Ap-

peals for the Seventh Circuit, affirming the order of dis-

missal of the United States Processing Tax Board of Re-

view, will be found in the record on pages 87 to 94, inclusive.

On October 1, 1940, that court entered an order denying a

petition for rehearing. (R. 95.)

i

REASONS RELIED UPON FOR ALLOWANCE

OF WRIT.

The writ of certiorari should be granted in this case for

the four reasons, which are more particularly presented in

the order stated in the following summary.

I. There is a present conflict between two Circuit Courts

of Appeal in the same matter.

II. The Circuit Court of Appeals for the Seventh Cir.

cuit in the instant case has decided a federal question in

a way in conflict with applicable decisions of this Court and

other federal courts.

III. The Cireuit Court of Appeals has decided an im-

portant question of federal law which has not been, but

should be settled by this Court.

IV. Title VII of the Revenue Act of 1936 is unconstitu-

tional as construed by the Circuit Court of Appeals, as it

does not provide an adequate remedy, and conflicts with

the Fifth Amendment to the Constitution of the United

States.

I.

There is now a conflict between the Circuit Court of Ap-

peals for the Second and Seventh Cireuits as to whether

the United States Processing Tax Board of Review or the

federal courts have jurisdiction to review the Commission-

er’s determination on particular claims for refund of proc- |

essing taxes paid.

In the case of Trunz Pork Stores, Inc. v. Rasquin, 100

Fed. (2d) 399, decided December 5, 1938, the Circuit Court

of Appeals for the Second Circuit held that the United

States District Courts were without jurisdiction to review

a claim for refund of processing taxes paid by claimant to

7

the United States. That court further held that under Title

VII the United States Processing Tax Board of Review did

have exclusive jurisdiction thereof.

The Circuit Court of Appeals for the Seventh Circuit

held in your petitioner’s case that with respect to the same

issue (as in the Trunz case above) that if a remedy existed,

the federal courts and not the Board had jurisdiction there-

of. (R. 93.)

Your petitioner has lost its right to appeal to the federal

courts on this question as the statute has tolled. It is un-

likely that the district courts or the Court of Claims would

entertain jurisdiction if this ease could now be taken to

those courts. Therefore, your petitioner is without remedy

except in praying for the issuance of a writ of certiorari.

It is urged that the decision of the Second Cireuit was

correct and that of the Seventh Circuit, in conflict there-

with, is in error.

II.

The Cireuit Court of Appeals for the Seventh Circuit,

in the instant case, has decided a federal question in con-

liet with applicable decisions of this Court and other fed-

eral courts.

The majority opinion of the Board, which was sustained

by the Circuit Court of Appeals, held that the Board did

not have jurisdiction under Title VII of the Revenue Act

of 1936, because (1) the petitioner was not the taxpayer

of the processing taxes in controversy either as to the

amount it paid directly to the United States, nor the larger

amount paid by it through a third person, and (2) that the

third person (a public abattoir) was the taxpayer.

The processing taxes imposed under the Agricultural Ad-

justment Act were excise taxes. It is well settled, that when

this Court and lower federal courts have decided certain

——

8

fundamental principles with respect to a particular form

of taxation, that Congress recognizes the application of

those decisions to subsequent similar legislation. Where

Congress intends a proper departure from such decisions,

the wording of the statute makes this intent clear. No in.

tent to depart from applicable prior decisions appears in

the Agricultural Adjustment Act under which the taxes in

controversy were imposed, paid, or collected, nor in Title

VII, the remedial statute.

Nowhere do we find a reference in that Act to a public

abattoir, nor authority to impose a tax upon such person,

In the discussion of that Act, including all amendments

thereto, by members of Congress, no reference whatsoever

is made to a public abattoir or custom slaughterer.

The assessment of processing taxes from such person

was entirely due to an informal ruling of the Commissioner

of Internal Revenue. (Internal Revenue Bulletin No. 20,

page 19.) (See Argument I of supporting brief, p. 29.) This

ruling was in direct conflict with well established Regula-

tions and Treasury Decisions that defined the meaning of —

taxpayer as related to excises. Those Regulations and

Treasury Decisions were pursuant to decisions of this Court

and lower federal courts.

This question is of great importance here, because had

not this informal ruling (in error) been made or followed,

it is reasonable to assume that both the Board and the Cir-

cuit Court of Appeals would have both held directly op-

posite to their decision in this case.

In the case of the Carbon Steel Co. v. Lwellyn, 251 U.S.

501, 64 L. Ed. 375, 40 S. Ct. 283, in construing the meaning

of ‘‘manufacturer’’ for tax purposes under the Munitions

Tax Act of September 8, 1916, this Court held that the per-

son who was the owner of the material, was the person

subject to the tax, notwithstanding the fact that the

owner had caused a large part of the manufacturing or

9

processing to be performed by subcontractors. (These sub-

contractors were independent contractors.)

In Warner-Patterson Co. v. U. S., 68 Ct. of Cl. 237, that

Court held that a corporation, which owned exclusive li-

censes to manufacture certain lenses, was the manufac-

turer or producer subject to the excise tax imposed under

Section 900 of the Revenue Act of 1924. The corporation

did not itself perform any labor necessary to produce the

lenses. It had engaged other persons (independent con-

tractors) for that purpose.

In the case of Stahmann, et al. v. Vidal, 305 U.S. 61, 59

§. Ct. 41 (which case arose under the Bankhead Cotton

Act), this Court held that the ginner (a custom processor,

also an independent contractor) was the *‘collecting agent”’

for the taxpayer with respect to the tax, and allowed a re-

covery to the owner of the cotton, who was not a ‘‘mere

volunteer’’ with respect to the tax in controversy.

Needless and irreparable injury to petitioner can readily

be avoided by the application of the equitable principles

laid down by this Court in the Stahmann case.

Petitioner’s contention is also supported by the following

cases with which the decision of the Circuit Court of Ap-

peals is in conflict.

White v. Hopkins, 51 Fed. (2d) 159.

Lukas v. Kentucky Distillers & Warehouse Co., 70

Fed. (2d) 883.

Il.

The Cireuit Court of Appeals has decided an important

question of federal law, which has not been, and should be

settled by this Court.

After this Court held the Agricultural Adjustment Act

unconstitutional, Congress incorporated Titles III and VII

i

JU

into the Revenue Act of 1936, which were related to each

other and to the Agricultural Adjustment Act. This case

has arisen under Title VII of that Act. It has been com.

monly recognized that those Titles were extremely difficult

to understand and to administer. The possibility of admin-

istrative and judicial mistakes is great, which, if occur,

may operate unfairly either to the Government, claimants,

or taxpayers.

This case is one of the first to reach this Court because

it is here on a question of jurisdiction. Undoubtedy many

other cases involving other questions of law under those

Titles will follow. A decision of this Court in the instant

case will be of inestimable value in enlightening all persons

now struggling with these difficult problems.

The decision of the Circuit Court of Appeals will create

greater hardship by its application to Title IIT. Under the

theory that this Court may consider the full effect of its

decision not only with respect to the matter at hand, but

also that which follows by necessary implication, this prob-

lem will be presented in the Brief (Argument III) support-

ing this petition.

The case of Arabi Packing Co., Inc. v. Commissioner, 109

Fed. (2d) 278, certiorari denied June 3, 1940, 60 S. Ct

1093, is not considered controlling nor applicable to this

case for the following reasons.

1. The Arabi Co. brought its action in a representative

capacity, not for itself as a taxpayer, but entirely for the

benefit of others. Title VII of the Revenue Act of 1936

clearly does not provide such a remedy.

2. If recognition is to be given to a public abattoir (cus-

tom processor) under Title VII, it is clear that the United

States District Courts or the United States Court of Claims

have concurrent jurisdiction thereof and not the Board.

The Circuit Court of Appeals for the Seventh Circuit in

11

the instant case has classified the claims arising under Title

VII and by its decision supports this contention.

3. The facts and the questions of law presented here are

different than those in the Arabi case. Petitioner respect-

fully contends that important matters are for the first time

brought to this Court in its supporting brief.

IV.

Petitioner believes that Title VII of the Revenue Act of

1936 can be reasonably construed to provide an adequate

relief to all persons who were directly affected by the im-

position of the illegal processing taxes. This is a remedial

statute.

The intent of Congress was to repeal previously existing

procedural methods and to establish a complete, special,

and exclusive remedy for all persons on all proper ques-

tions with respect to the refunding of processing taxes.

_ (Anniston Mfg. Co. v. Davis, 301 U. S. 337.)

The doctrine that remedial statutes are to be liberally

construed is well established. Federal Courts have repeat-

edly held that such statutes will be construed to include

cases Within the reason, although outside the letter of the

statute, and to include cases within the letter, but outside

the reason. All remedial statutes must be liberally con-

strued if necessary to reach and decide the merits of the

case,

In the case of Knowlton v. Moore, 178 U.S. 41, this Court

held that a particular construction must not produce in-

equality and injustice if another and more reasonable inter-

pretation is possible.

It is well known that in construing remedial statutes,

the courts will give due regard for the former law, the de-

fects or evils to be cured or abolished, or the mischief to

——

12

be remedied, and the remedy provided should be inter.

preted liberally.

Jones v. Virginia, 25 Fed. 666.

Seigel v. U. 8S. 18 Fed. (Supp.) 771.

Grier v. Kennan, 64 Fed. (2d) 605.

Detroit Hotel v. Brady, 275 Fed. 995.

The Circuit Court of Appeals recognized that petitioner

supplied the funds for payment of all the processing tax

in controversy. That Court recognized that part of the tax

was paid direct to the United States and the balance paid

to C. A. Burnette Company before that company remitted

to the United States. Yet, that Court found that neither

the petitioner nor any other person had a right to a recov-

ery under the provisions of this remedial statute.

Under Title VII, all of petitioner’s larger competitors

who owned killing floor facilities and slaughtered their own

hogs, appear to have the unquestioned right to recover the

processing taxes paid by them to the extent of the burden |

borne. Petitioner seeks justice only. It contends that this

statute is unconstitutional in that it discriminates between

persons of the same class, or the decision of the Circuit

Court of Appeals is in error.

This Court has held that an arbitrary selection can never

be justified by calling it a classification. And further held

that while there is no requirement that a classification be

scientifically accurate, it must be based on something more

than a ‘‘mere difference.” Gulf C. & F. S. R. T. Co. v,

Ellis, 165 U. S. 150.

In the case of Stewart Dry Goods Co. v. Lewis, 294 U.S.

553, this Court held that a classification must not be arbi-

trary or capricious but should rest upon some reasonable

or prevalent economic or social condition which can be

used to rationalize the distinguishment thus made.

The simple truth is that petitioner and its larger com-

13

petitors are all meat packing companies, yet the Circuit

Court of Appeals has decided that a remedial statute can

give rights to some and deny the same rights to others in

the same classification. To the extent that petitioner paid

the tax to the United States, that Court must be in error.

This seems equally true with respect to the balance of the

tax which petitioner was compelled to pay through a ‘‘col-

lection agent,’’ a ‘‘mere funnel,’’ to the United States.

Congress is without power to change a previously exist-

ing “‘Right’’ under the guise of a change in procedure. At

the time the processing taxes were collected, Sections 3226

and 3228 (U. S. C. A.) provided a simple but complete

remedy for the recovery of moneys illegally exacted. To

substitute therefor a remedy or a procedure which is not

fair and reasonable, but which is arbitrary and capricious,

can but result in the taking of property without due process,

and is in violation of the Fifth Amendment to the Constitu-

tion of the United States (Combes v. Getz, 285 U. S. 434;

Ettor v. Tacoma, 280 U. S. 148; Knickerbocker Trust Co. v.

Meyers, 133 Fed. 764).

Section 901 of Title VII repeals Sections 21 (d), 21 (e),

and 21 (g) of the Agricultural Adjustment Act. Section

0 of Title VII purports to eliminate the right to sue the

Collector with respect to processing taxes wrongfully col-

leted by him, which right had existed prior thereto.

Of the processing taxes in controversy, $2,589.13 (R. 43,

4) was paid directly to the Collector upon his demand and

10 part thereof has ever been refunded. Processing taxes

inthe amount of $13,711.23 (R. 19, 43) were also paid di-

rectly to the Collector, and no part thereof was refunded in

such a way so that it was available for the use or benefit

of the petitioner. Therefore, it is contended that a right

existed prior to the enactment of Title VII, which Congress

could not destroy. It is submitted that unless Title VIT

provides a full and adequate remedy for the recovery

14

thereof, then it is unconstitutional as conflicting with the

Fifth Amendment.

The interpretation of Title VII is not simplified by the

provision contained in Section 902 (b) thereof, which pro.

vides for the refund of processing taxes to a vendor, under

certain conditions, providing he has repaid unconditionally

such amount to his vendee. Section 902 (b) does not apply

to the facts in this case, nor is any actual relief provided

thereunder for your petitioner.

There was never a possibility that C. A. Burnette Com.

pany could make an unconditional repayment of the pro.

essing tax in controversy to the petitioner and others

similarly cireumstanced. It was financially unable to make

such a repayment. The condition if applicable was one

that was impossible to perform.

It is contended that C. A. Burnette Company was not the

vendor of the petitioner, but was the ‘‘collection agent”

for the United States with respect to the processing taxes

paid through it.

Respectfully submitted,

Rayrorp W. LEeMLey,

Attorney for Petitioner.