The sun. [volume] (New York [N.Y.]) 1833-1916, 1900-02-15

Isle, In defiance Of law and Of manifest
right, to hold on 10 tho six or seven mil.
lions which the manufacturers paid In No a
matter Of form, In good faith, under Sec
ton 81, on the strength OF their Govern
ment's promise to return them the money
thus paidf
These questions are Of historical and
| psychological interest only. The Cleveland
! administration %impounded the manufacture
ers' alcohol tux by a process for which en-
bezzlemcnt scarcely seemsto too harsh "a term.
and the wronged and amazed manufact-
urcrs turned naturally to the courts for
relief. A test case was made up In the form
Of a suit brought In the Court OF Claims by
the Messrs. r, DUNLAP 4 Co., the New
York hatters, for the return OF about
$1,000 paid In internal revenue taxes on
alcohol used by them in their business OF
hatmaking while Section 81 was in force.
The Court OF Claims found for the claimant
| on all questions OF fact as TO the use OF the
alcohol and the payment OF the tax, but
dismissed the petition or the purely tech
meal ground that because the rebates were
to be paid only on alcohol used "under
| regulations to be prescribed by the Secre-
tary Of the Treasury" the alcohol had not
been so used, Secretary CARLISLE having
failed to prescribe regulations. and there
could be no recovery.
Then the test case was appealed to the
Supreme Court. The nppellantsw were repre-
sented by distinguished counsel, among
! whom was the Hon. JOSEPH II. CHoATE-
The broader Constitutional aspects OF the
question we're ably presented, but were not
taken into consideration by the Court. 1t
would not be profitable to discuss here
the opinion by which the Supreme
Court, by a bare majority Of one, four
Justices dissenting, held that tho original
failure Of Secretary CARLISLE TO respect
the mandatory provision OF Section 81
constituted a technical bar excluding these
manufacturers from the remedy which IL
equitably theirs in the opinion Of all men,
and which would be legally theirs II the
Secretary had obeyed the law.
A petition for n rehearing in the case Of
! ROBERT DUNLAP 4 Co. has been denied.
Another test case has been prepared, In
which the American Aristotype Company is
to represent the common interests OF all
the manufacturers who paid the alcohol tax
at beverage rates and have failed to get
their promised rebate. And to prevent the
interpositIon a second time Of the ghost Of
Secretary CARLISLE, shutting out wronged
citizens from the remedy to which they are
Justly entitled, bills have been introduced
in both Houses OF Congress, in the Senate
by Senator PLATT OF Connecticut, and in
the House by Representative RUSSELL, pro-
viding as follows:
THAT the failure OF the Secretary OF the Treasury
to prescribe regulations for the use OF alcohol in the
arts and in medicinal and other like compounds. ~
required by Section 81 OF the Revenue Act OF Aug.
20, 1924, shall not operate as a defence on the part
OF the United States. to any suit Of q manufacturer
under said act brought in any court of the United
States"
1t will be observed that this measure Of
obvious justice ap~propriates no money. It
merely opens the way to the adjudication
OF legitimate and equitable claims OF Ameri-
can manufacturers in twenty or more
branches Of industry. They have paid into
The Treasury six millions or so, on the
pledge Of the statute that the money
should be returned. Not one dollar OF the
six millions was intended by Congress
to be withheld by the Government
from its rightful owner. The money
is locked up in the Treasury solely
by the technical proposition that the
failure OF an executive officer to prepare
regulations Ia a bar to recovery. It must
be borne in mind that when the recent taxes
for war revenue were imposed by law and
fell 80 largely on these same manufacture
ers Of proprietary articles. the Government
held that the delay in issuing regulations
was no bar to the legality Of the taxes or to
the practical collection Of the sane. II Is a
rule that should work both ways.
The bill ought to be reported promptly
and passed unanimously. We do not see how
any Senator or Repres s~ntative can fail to
see the importance Of asserting the princi-
pie that the taxing poweris with Congress,
and that with Congress, and not with the
Secretary OF the Treasury. Ia the decision
az to what shall be taxed and what OK.
empted. Nor do We see how any honorable
man in Congress can vote to make the
United States Government the embezzler
Of five or six million dollars properly be.
longing to private citizens Of the United
States.