#### NORTHWESTERN BARB WIRE CO. v. THE UNITED STATES

[No. K-183.

Decided June 2, 1930]

*330
      *Mr. Benjamin B. Pettus*for tbe plaintiff. *Mr. Edward Clifford*and *Oolladay, Clifford c& Pettus*were on the brief.

*Mr. Joseph H. Sheppard,*with whom was *Mr. Assistant Attorney General Charles B. Rugg,*for the defendant. *Mr. Charleé F. Kinoheloe*was on the brief.

*332Williams, *Judge,*

delivered the opinion of the court:

This is a suit to recover $7,481.37, additional tax paid for 1917, together with interest thereon of $2,049, making a total of $9,530.37, together with interest from May 13, 1927, the date of payment.

Plaintiff claims that the amount was collected after it was barred by the statute of limitation as extended by certain written consents between it and the Commissioner of Internal Revenue.

Plaintiff’s return for the calendar year 1917 was filed March 30, 1918. The five-year period for assessment and collection of any tax for 1917 would have expired on March 30, 1923, but on February 1, 1923, plaintiff and the commissioner entered into a consent in writing extending the period of limitation for assessment and collection of the tax for 1917. Other consents were executed, the last one of which extended the period of limitation for determination, assessment, and collection for 1917 to April 1, 1926. The assessment of the additional tax in controversy was made in November, 1922, but collection was not made until May 13, 1927, nearly fourteen months after the expiration of the period provided in the written consents. The collection, however, was made within six years after the date of the assessment in November, 1922. Plaintiff insists that the waiver was a binding contract which was not-modified in any way by the provisions of the revenue act of 1926, 44 Stat. 9, and that the commissioner was, therefore, compelled to make, collection on or before April 1, 1926, in order for the same to be legal.

The defendant contends that assessment of the tax having been timely made and the statutory period, as extended by *333the waiver, not haying expired upon the passage of the revenue act of 1926, the commissioner was authorized by that act to make collection at any time within the six years after the assessment.

But for the fact that the assessment in this case was made prior to the enactment of the revenue acts of 1924 and 1926, the question of limitation before the court in *Florsheim Brothers Drygoods Company, Ltd.,*v. *United States*and *White*v. *Hood Rubber Company,*280 U. S. 453, decided February 24, 1930, would be identical. But, in view of the provisions of section 278 (d) of the revenue act of 1926, that where the assessment of any income or profits tax has been made, whether before or after the enactment of that act, such tax may be collected within six years after the assessment of the tax or prior to the expiration of time for any collection agreed upon in writing by the commissioner and the taxpayer, we think it is clear that collection on May 13,1927, was proper. In *Florsheim Brothers Drygoods Co., Ltd., supra,*the court said:

> *“*The Government contends that the ‘ Income and Profits Tax Waivers ’ executed by the corporations were waivers by them of the statutory period for another year; that while these waivers were still in force and while the corporations’ liability was thus still alive, the revenue acts of 1924 and 1926 were passed, increasing the period for collection to six years after assessment; that these acts are applicable to the cases at bar; and that, since the collections were made within six years after the assessments, they were timely made. The corporations insist that the £ waivers ’ were not merely waivers extending the statutory period, but were binding contracts which limited the time in which the commissioner could assess and collect the taxes; and that no change in the law made after the date of the contracts and enlarging the time for collection can affect their rights. They urge that the 1924 and 1926 acts did not purport to extend the periods thus limited by contract; and that, if construed as extending such periods, the provisions of these acts are unconstitutional. They concede that, in the absence of contract, a legislature may constitutionally lengthen or shorten the period in which a right may be enforced by legal proceedings.

> “ We are of opinion that the contention of the Government must prevail. The waivers executed by the parties were not contracts binding the commissioner not to make the assess*334ments and collections after the periods specified. At the time when the waivers were executed, the commissioner was without power under the statute to assess or collect the taxes after the statutory period, as extended by the waivers. A promise by the commissioner not to do what by the statute he was precluded from doing, would have been of no significance-The waivers do not purport to contain such a promise. *Bank of Commnerce*v. *Rose,*26 F. (2d) 365, 366; *Greylock Mills*v. Commissioner, 31 F. (2d) 655, 657. And obviously, the commissioner did not undertake to limit the power of Congress to extend the period of limitations, as consideration for the waivers. The instruments were nothing more than what they were termed on their face — waivers; and that was all to which the commissioner was authorized to consent.”

In view of the provisions of section 278 (d) of the revenue act of 1926 making the provision with reference to the right of the Government to collect a tax timely assessed within six years after the date of assessment, even though such assessment was made before the enactment of that act, it is clear that the plaintiff is not entitled to recover.. In fact plaintiff' makes no claim that it is entitled to- recover because the assessment was made prior to the enactment of the revenue act of 1926 but its claim is based entirely upon the fact that the commissioner was bound to collect within the period specified in the waiver. This question is entirely disposed of adversely to plaintiff’s contention by the *Florsheim*and *Hood, cases.*

Plaintiff is not entitled to recover and the petition is dismissed. It is so ordered.

LittletoN, Jwdge/ GreeN, *Judge;*and Booth, *Chief*Justice, concur.