#### ALEX. D. SHAW & CO. v. THE UNITED STATES.

[No. 33S-A.

Decided November 12, 1923.]

*On the Proofs.*

*Customs duties; jurisdiction.*— Taxes collected under section 600 (a) of tlie act of February 24, 1919, 40 Stat. 1105, on distilled spirits imported into the United States are customs duties, and the Court of Claims has no jurisdiction of suits for the refund of such duties.

*The Reporter'’s*statement of the case:

*Mr. W. P. Preble*for the plaintiffs.

*Mr. Fred K. Dyar,*with whom was *Mr. Assistant Attorney General Robert H. Lovett,*for the defendant.

The following are the facts of the case as found by the court: ,

I. The plaintiffs are, and were at the times of the different transactions hereinafter set forth in these findings, co-partners trading under the firm name and style of Alex. D. Shaw & Co., and doing business in the city of New York, State of New York, as importers. The names of the individual partners in said firm are Munson G. Shaw, Lawrence Daly, citizens of the United States, and Arthur E. Howell,, a British subject and a resident of New York City.

II. At different dates prior to May 13, 1920, the plaintiffs imported into the United States at the port of New York *643and deposited in the United States customs bonded warehouse in that city 28,669.88 gallons of distilled spirits.

III. From May 13, 1920, to June 28, 1921, at different dates and in different quantities said distilled spirits were withdrawn from said bonded warehouse for nonbeverage purposes, at which dates the collector of customs of New York City assessed and collected thereon a duty of $2.60 per proof gallon under paragraph 2312, the tariff act of October 3, 1913, 38 Stat. 114, 135.

IY. When said distilled spirits were withdrawn as aforesaid the collector of customs of New York City also assessed and collected a tax of $2.20 per proof gallon on said distilled spirits under section 600 (a) of the act of February 24, 1919, 40 Stat. 1105, amounting, in the aggregate, to the sum of $63,073.75. The said tax was paid in every instance by the plaintiffs to the collector under protest upon the ground that said distilled spirits were not subject to any internal-revenue tax and therefore said tax had been improperly imposed.

Y. For every collection of taxes on said distilled spirits under section 600 (a) of the act of February 24, 1919, the plaintiffs demanded refund by the collector of internal revenue for the second district of New York, as follows:

“ Under T. D. 38418, dated May 12, 1920, the collector of customs of the port of New York was instructed to collect on all withdrawals from bond of imported distilled spirits for nonbeverage purposes an internal revenue tax of $2.20 per gallon under Title YI, section 600 (a), of the act of February 24, 1919, and to account for said $2.20 per gallon as an internal revenue collection.

“ We have protested the payment of this to the collector of customs and now respectfully demand that the amount, collected by said collector of customs be refunded to us. “

“ The grounds of our protest are: *“*

*“*That Title VI, section 600 (a), of the act of February 24, 1919, reads—

“ That there shall be levied and collected on all distilled, spirits now in bond, or that have been, or that may be hereafter produced in or imported into the United States * * * in lieu of the internal revenue taxes now imposed thereon, by law, a tax of $2.20 (-) on each proof gal-*644Ion, or wine gallon when below pi-oof, and a proportionate ta,x at a like rate on all fractional parts of such proof or wine gallons to be paid by the distiller or importer when withdrawn and collected under the provisions of existing law.’

“ By T. D. 37391 and T. D. 37999, the tax imposed under title ill, section 300, of the act of October 3, 1917, was held as a duty and was collected as such. This position is reiterated in T. D. 38418. Therefore, at the time that the act of February 24,1919, became effective there was no internal-revenue tax imposed on imported spirits, and therefore section 600 (a), Title VI, of the act of February 24, 1919, does not impose any internal-revenue tax on imported spirits, for it specifically states that the taxes imposed were in lieu of internal-revenue taxes then existing.”

The Commissioner of Internal Revenue rejected each and every one of plaintiff’s claims for refund of said taxes, as follows:

“ The following claims, filed by you for the refunding of

amounts in the aggregate of -, representing internal-

revenue taxes paid at the rate of $2.20 per proof gallon, *covering*imported distilled spirits, have been considered :

“ It appears that these taxes were collected by the collector of customs at the port of New York upon withdrawal of the spirits from the customs bonded wai’ehouse to be sold for use for nonbeverage purposes, as provided under title 6, section 600 (a) of the revenue act of 1918, and that these funds are requested for the reason that there was no internal-revenue tax due on these imported spirits under the provisions of the aforesaid act.

“ However, it seems clear to this office that the statute, imposes a tax at the rate of $2.20 per proof gallon, or wine gallon, when below proof, on all distilled spirits imported into the United States to be sold for nonbeverage purposes. It is therefore held that the amounts involved were legally collected and are not refundable.

*“*The claims are accordingly hereby rejected in full.”

VII. Of the $63,073.75 collected, as stated in Fnding IY, it is agreed by stipulation of the parties that $2,164.80 was paid as customs duties under the tariff act of October 3, 1913, 38 Stat. 114, 135, leaving as the amount in controversy the sum of $60,908.95, hone of which has been refunded to plaintiff.

*645MEMORANDUM BY THE COURT.

1. The Court of Customs Appeals held that a tax in all respects similar to that complained of was a customs duty. See *Alex. D. Shaw & Co.*v. *United*States, 11 Ct. Cust. Appls. 226.

2. The tax being a customs duty this court is without jurisdiction; and on the other hand, if it was an internal-revenue tax the plaintiff was liable for it.

The petition is dismissed.