Case ID: f2d_26/html/0668-01.html
Source: Caselaw Access Project
Author: {"author": "JOHNSON, Circuit Judge.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

GALLARDO v. PORTO RICAN AMERICAN TOBACCO CO.
    Circuit Court of Appeals, First Circuit.
    May 31, 1928.
    No. 2213.
    Taxation @=605 — Suit resisting “inspection fee” under Porto Rican statute to protect tobacco against fraud and adulteration held not maintainable in federal court (Act March 4, 1927, amending Organic Act. of Porto Rico, § 48 [48 USCA § 872]).
    Under Act March 4,1927, amending Organic Act of Porto Rico, § 48 (48 USCA § 872), by adding provision that no suit to restrain assessment or collection of any tax imposed by laws of Porto Rico shall be maintained in District Court of United States for Porto Rico, held, that suit resisting payment of inspection fee under statute of Porto Rico approved April 23, 1927, entitled “An act to protect Porto Rican tobacco and cigars against fraud and adulteration by means of * * * issue of guaranty stamps determining the origin of the tobacco and by adequate expert inspection, establishing an inspection fee to defray such expenses,” was not maintainable in District Court; such “inspection fee” being a tax assessed on complainant within the statute.
    Appeal from the District Court of the United States for the District of Porto Rico; Wells, Judge.
    Suit by the Porto Rican American Tobacco Company against Juan G. Gallardo, treasurer. Judgment for plaintiff, and defendant appeals. On defendant’s motion to-dismiss for want of jurisdiction.
    Motion granted, and cause remanded, with directions.
    William Cattron Rigby, of Washington, D. C. (George C. Butte, Atty. Gen,, of counsel), for appellant.
    Charles S. Day, Jr., of New York City, for appellee.
    Before BINGHAM and JOHNSON, Circuit Judges, and HALE, District Judge.
   JOHNSON, Circuit Judge.

In this case a motion to dismiss for want of jurisdiction was filed by the appellant before printing the transcript of the record.

On March 4,1927, Congress amended section 48 of the Organic Act of Porto Rico by adding thereto the following paragraph:

“That no suit for the purpose of restraining the assessment or collection of any tax imposed by the laws of Porto Rico shall be maintained in the District Court of the United States for Porto Rico.” Act March 4, 1927, 44 Stat. c. 503, pp. 1418, 1421 (48 USCA § 872).

In accordance with a statute of the Legislature of Porto Rico, approved April 23, 1927, entitled “An act to protect Porto Rican tobacco and cigars- against fraud and adulteratíon by means of a guaranty and advertising agency in the city of New York, United States, the issue of guaranty stamps determining the origin of the tobacco and by adequate expert inspection, establishing an inspection fee to defray such expenses as the application of this act may occasion,” etc., an inspection fee was established, the payment of which was resisted by the appellee.

In its bill of complaint the tobacco company alleges that this inspection fee is an excise tax. While denominated an inspection fee, it is in reality a tax assessed upon the appellee, and clearly falls under the inhibition of the Act of March 4,1927.

The motion of the appellant is granted, and the cause is remanded to the District Court of the United States for Porto Rico, with directions to vacate the decree heretofore entered by it in this cause, and to dismiss the same for want of jurisdiction.