National Casket Co. v. Commissioner

NATIONAL CASKET CO., PETITIONER, v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT. National Casket Co. v. Commissioner Docket No. 19982. United States Board of Tax Appeals 16 B.T.A. 1141; 1929 BTA LEXIS 2440; June 25, 1929, Promulgated *2440 Where the last day of the period in which the Commissioner may make an assessment falls on Sunday, an additional day in which to assess is not allowed him by the statute. Richard T. Greene, Esq., James L. Dohr, Esq., and John E. Hughes, Esq., for the petitioner. A. H. Fast, Esq., for the respondent. SIEFKIN *1141 This proceeding results from the determination of a deficiency of $266,627.08 in income and profits taxes for the fiscal year ended June 30, 1919. Numerous errors are alleged but, upon motion, the hearing was limited to the question whether the deficiency is barred by the statute of limitation. The facts relating to this issue are stipulated. FINDINGS OF FACT. Petitioner filed its income and profits-tax return for its fiscal year ended June 30, 1919, with the collector of internal revenue for the 23rd district of Pennsylvania, at Pittsburgh, Pa., on September 13, 1919. Petitioner filed a waiver on March 12, 1924, which waiver reads as follows: In pursuance of the provisions of subdivision (d) of section 250 of the Revenue Act of 1921, National Casket Company, of Boston, Massachusetts and *1142 the Commissioner*2441 of Internal Revenue, hereby consent to a determination, assessment, and collection of the amount of income, excess-profits, or war-profits taxes due under any return made by or on behalf of said company for the year ended June 30, 1919, under the Revenue Act of 1921, or under prior income, excess-profits, or war-profits tax Acts, or under Section 38 of the Act entitled "An Act to provide revenue, equalize duties, and encourage the industries of the United States, and for other purposes", approved August 5, 1909. This waiver is in effect from the date it is signed by the taxpayer and will remain in effect for a period of one year after the expiration of the statutory period of limitation, or the statutory period of limitation as extended by any waivers already on file with the Bureau, within which assessment of taxes may be made for the year or years mentioned. (Signed) NATIONAL CASKET COMPANY, INC., Taxpayer. By P. B. HEINTZ, President. D. H. BLAIR, Commissioner. September 13, 1925, fell on a Sunday. On September 14, 1925, the respondent signed an assessment list which included an assessment against the petitioner in the amount of $266,627.08. After September 14, 1925, the*2442 collector of internal revenue received said assessment list and issued his notice and demand to petitioner to pay the amount shown thereon on September 22, 1925. On October 1, 1925, petitioner filed an abatement claim which was rejected. After the filing of its petition and on October 21, 1926, petitioner paid the collector of internal revenue the amount of the said assessment of $266,627.08. OPINION. SIEFKIN: The sole question before us is whether the assessment in this case was made within the five-year period prescribed by the statute of limitations as extended by the waiver for one year. The return was filed September 13, 1919. Under the rule laid down in United Telephone Co.,1 B.T.A. 450, the statutory period began at midnight of September 13, 1919. Petitioner questions such exclusion of the day the return was filed in computing the statutory period, but in our view of the case at bar the query raised becomes unimportant. Assuming the cited case to be sound, the ordinary five-year period gave respondent until midnight of September 13, 1924, to make the assessment. The waiver filed would ordinarily be interpreted as extending that period for one*2443 year, or to midnight of September 13, 1925. The assessment was not made until September 14, 1925. Respondent, however, contends that since September 13 fell on Sunday, the respondent's action of the succeeding day was timely. The issue is *1143 thus reduced to the question whether the fact that the day terminating the statutory period was Sunday, served to give the respondent one more business day in which to make the assessment. Respondent contends the rule applied at common law which he asserts gave the additional day in such instances, is applicable as the consent in writing for the extension of the period constituted a contract. Whatever the rule at common law is, we think it has no application. The question at issue is the interpretation of a statutory provision, as the written consent method of extending the period, as well as the usual limitation period, is prescribed by the statute. As we said in Wirt Franklin,7 B.T.A. 636: The instrument under consideration is denominated as "income and profits tax waiver." It is in fact a bilateral undertaking entered into by the parties pursuant to the statute. Technically, it is not a waiver of the statute, *2444 for it is made pursuant to the statute. It is not an acknowledgment of any existing obligation or a new promise to pay, from which a new cause of action arises, thus beginning anew the period of limitation. It is not an agreement not to plead the statute of limitations as a defense to any asserted tax liability. In short, it is not something to be considered as in avoidance of the statute. By the statute and by its terms, it operates to extend the time. Accordingly, an extension by a consent in writing must be added to the ordinary statutory period and treated in the same manner as if Congress had granted the additional time in the statute itself. Respondent also urges a distinction should be drawn where the act to which the limitation applies is a judicial or administrative act. The authorities cited upon this point need not be exhaustively considered. Some of them deal with limitations imposed by court rules or with limitations numbered in days, or both, and are distinguishable for that reason. Others are so remotely related to the question at issue that it is easier to distinguish them than to interpret them as pertinent authority. None of them are persuasive. The*2445 contention itself to be here pertinent amounts to urging that the statutes limiting administrative acts must be distinguished from those of general application, for the statute in question purports to apply only to an administrative act. So stated, the contention must fail as we think there is no room under the authorities cited below to extend the statute by interpretation. A similar distinction urged between an administrative or judicial act and the act of a mere party litigant must be rejected for a like reason, as the statute obviously limits the time of an administrative officer who might be termed a party litigant. The rule that ordinarily a statute of limitations does not run against the Government has no place in this controversy, where we *1144 have a statute which operates only against the Government. Most of the authorities cited are concerned with time limits on which appeals may be filed in higher courts. This question has been extensively considered in both State and Federal courts. It has likewise been before us in Sam Satovsky,1 B.T.A. 22, in which we quoted from *2446 Johnson & Meyers,54 Fed. 417, the leading case. In the Satovsky case we held a petition which failed to reach the Board on Sunday (the sixtieth day) or on Monday (Labor Day), by reason of failure of mail delivery, was not timely filed when delivered on Tuesday, the next business day. That case was followed in Southern California Loan Association,4 B.T.A. 223, in which we again cited Johnson & Meyers, supra, as controlling. Such decisions are in accord with the great weight of authority, where the limitation period is measured, or can be measured, in terms of months or years rather than in days. The rule followed must now be taken as well established in the Federal courts at least; Sergelschuffer v. Pennsylvania Mutual Life Insurance Co.,248 Fed. 226; Meyers & Hot Springs Imp. Co.,169 Fed. 628; Frackelton v. United States,57 Ct.Cls. 587; Belmont-Smokeless Coal Co. v. United States Board of Tax Appeals,277 Fed. 727; *2447 Covey v. Williamson,286 Fed. 459. It is unnecessary to restate at length the decision in Johnson v. Meyers, supra. However, we again call attention to that portion of the decision which points out a number of statutes indicating it to be the Congressional understanding "that all Sundays shall be counted as part of the time limit within which an act is to be done under their legislation, unless they are excluded by express provision." It may well be observed that Congress in the later Revenue Acts (Sec. 274, Act of 1924 and sec. 272, Act of 1928) has seen fit to expressly exclude the sixtieth day (if a Sunday) in computing the limitation period within which appeals may be filed with this Board. No such change has occurred in the wording of the limitation provision under discussion. We see no reason why the principles laid down respecting limitations on appeals should not be extended to cover the question at issue. There seems no justification for altering, by interpretation, the period fixed by statute. Accordingly, we must hold the assessment barred. Reviewed by the Board. Judgment will be entered for the petitioner.