I. ,~ . 3 

i , i ; , ; 

THE ATTORNEY GENERAL 

OF TIWAS 

October 23, 1957 

Honorable Robert S. Calvert 

Comptroller of Public Accounts 

Capitol Station 

Austin 11, Texas 

Opinion NO. ww-286 

Dear Mr. Calvert: 

Re: Whether or not transportation agencies should 

be required to have a 

cigarette permit in order 

to dispose of damaged or 

salvage cigarettes that 

they may acquire from 

time to time due to refusal to accept the 

cigarettes by the conslgnee. 

You ask the opinion of this office.upon the question 

presented in your letter of September 19, 1957, the pertinent 

part of which is as follows: 

"At various times during the past common 

carriers that transport tax-free cigarettes have 

had delivery refused on these cigarettes by the 

consignee due to damage, etc. We have been 

requiring the transportation agency to take out 

a cigarette permit in order to dispose of these 

cigarettes. The type of permit required from 

the transportation agency depended on the manner 

in wh-lch they intend to dispose of the clgarettes, either retail or wholesale. 

"At the present time the Panhandle and 

Santa Fe Railway Company have a case of damaged, 

unstamped, cigarettes in the unclaimed freight 

warehouse at Amarillo. They are aware of the 

fact that these cigarettes have to be stamped 

with tax revenue stamps but contend that they 

should not be required to have a cigarette 

permit in order to dispose of the cigarettes. 
Honorable Robert S. Calvert, Page 2 (W'W-286) 

"I nil1 appreciate it if you will 

advise me as to whether or not In your 

opinion transportation agencies should 

be required to have a cigarette permit 

in order to dispose of damaged or salvage cigarettes that they may acquire from 

time to time due to refusal to accept the 

cigarettes by the consignee." 

Section 4 of Article 7047c-1;Vernon's Civil Statutes, 

Is In part as follows: 

"Every distributor, wholesale 

dealer and retail dealer in this State 

now engaged or who desires to become 

engaged, in the sale or use of clgarettes upon which a tax is required 

to be paid, shall, tithln thirty (30) 

days from the date this law becomes 

effectlve,file with the Comptroller 

an application for a cigarette permit 

as a distributor, wholesale dealer or 

retail dealer, as the case may be, said 

application to be accompanied by a fee 

of Twenty-five ($25.00) Dollars if for 

a distrlbutorls permlt, or a fee of 

Fifteen ($15.00) Dollars if for a wholesale dealer's permit, or a fee of Five 

($5.00) Dollars if for a retail dealer's 

permit." 

It thus appears that if the common carrier, under the 

circumstances stated in your letter, Is a distributor, wholesale or retail dealer, tithln the meaning of the taxing statute, 

a permlt Is required. 

retail 

The Statute defines distributor, wholesale dealer and 

dealer in the language following: 

"'Distributor' shall mean and Include 

every person in this State who manufactures 

or produces cigarettes or who ships, transports, or Imports into this State or in any 

manner acquires or possesses cigarettes and 

makes a 'first sale' of the same in this State; 

the said term shall also include everyperson 

in this State who in any manner acquires or 

possesses unstamped cigarettes for the purpose 

of making a 'first sale' of the same within 
Honorable Robert S. Calver, Page 3 (~286) 

this State. 

"'Wholesale Dealer' shall mean and lnelude every 'person' other than a distributor 

or a salesman in the employ of a manufacturer 

and handling only the products of his employer 

who engages In the business or selling or dlstrlbuting cigarettes in this State for the purpose of resale. 

"'Retail Dealer' shall mean and include 

every person other than a distributor or 

wholesale dealer who shall sell, distribute, 

or offer for sale or distribution or possess 

for the purpose of sale or distribution, 

cigarettes irrespective of quantity or smount 

or the number of sales or distributions; . . .' 

We believe that the Intent of the Legislature, as evidenced by the language of the statute defining distributor 

and retail dealer, cannot reasonably be construed as Importing 

an exception to the operation of the statute for the benefit 

of a common carrier. If such common carrier, after having 

acquired possession of cigarettes, makes a "first sale" of 

the commodity in this State, or distributes or offers for 

sale or distribution, then the common carrier has subjected 

himself to the regulations Imposed by the statute. We are 

of the opinion that transportatlon~ agencies must have a 

cigarette permit In order to dispose of damaged or salvage 

cigarettes that they may acquire from time to time due to 

refusal to accept the cigarettes by the consignee. 

SUMMARY 

A common carrier who 

acquires ownership of 

unstamped cigarettes In 

its usual end customary 

operations of transporting 

for hire is not excepted 

from the o 

$ 

eration of 

Article 70 7c-1, Tex. Civ. 

Stat. (Vernon, 1948), and 

is required to secure a 
Honorable Robert S. Calve&, page 4 W-286) 

petit In order to sell 

such cigarettes. 

Very truly yours, 

WILL WIISON 

Atto-ey General oi Texas 

By&A!w, 

33. Ii. Tirmnins,.Jr. 

Assistant 

BHT:WSIIl 

'APPROVED: 

OPINION COMMITTEE 

Gee. P. Blackburn, Qlairman' 

Milton Richardson 

Wayland C. Rlvers, Jr.