Evening journal. [volume] (Wilmington, Del.) 1888-1932, 1922-06-13
Issue Injunction against
DUPONT Property Seizure

duPont's realty and personal prop
erty to enforce collection. and Mr..
dupont applied for a restraining
order. The Government moved 10
dismiss his petition and it was on
that motion the decision was
handed down by Judge Thompson.
His decision reads;
In the District Court OF the United
States for the District OF Della
ware:
Alfred l dupont VS.. Harry T. era
ham, individually and as Collector
OF Internal Revenue. No. 457.
In Equity.
Upon Plaintiffs motion for prelim-
mary injunction and Defendants
motion TO dismiss bill.
From the allegations OF the bill
and supporting AFFIDAVIT and the de-
fendant's affidavit, the followings
facts appear:
on September 40, 1915. the plain
tiff was the owner OF 37.7s7 shares OF
the common stock OF the r. l. du-
Point de Nemours Powder Company.
incorporated in 1908 under the laws
OF New Jersey hereinafter called the
New Jersey Company.
on October /. 1915. the New Jer-
sey Company transferred its assets
as an entirety and as a going con-
Germ to +. l. dupont de Nemours and
Company, Incorporated undef the
laws OF Delaware and hereinafter
called the Delaware Company.
As part OF the plan OF reorganiza-
ton. each stakeholder OF the New
Jersey Company received two shares
OF the common stock OF the Della
ware Company for each share OF
common stock held by him in the
New Jersey Company. The plaintiff
received on or about October !,
1915. a total OF 75.bS4 shares OF the
common stock OF the Delaware Com
pany OF the par value OF 500 per
share.
on February 10. 1918. the plain
tiff filed his income tax return un-
der the act OF October 3. 1913. and
on March I. 1915. filed an amended
return OF his income for 1915. The
plaintiff did not, however. return nor
pay tax upon the said stock dividend
as part OF his income. The plaintiff
believes he attached TO his return a
statement in writing fully setting
forth the entire transaction under
which he received the stock and pro-
testing against its inclusion in his in
come for the year 1918, but the fact
that he did attach such statement is
neither averred nor proved.
On January /. 1920. the plaintiff
received through the malls a notice
and demand dated December 81.
1919. that he pay to the defendant
as collector OF internal revenue on or
before January 10. 1920. the sum
OF t1.57s.O15.s6 for income tax for
the year 1915.
Il appears that on November 81,
1917. Income Tax Inspector duDoss
made a report to the Revenue Agent
in charge at Baltimore. Maryland. in
which he reported among other
things that the plaintiff had received
as income. during the year 1915. 200
per cent. in common stock dividends
distributed by the z. l. DUPONT de
Nemours Company. previously omit
ted. DuRoss made a further report
on July %, 1919, as a result OF which
and OF other investigations. the
OF Internal Revenue
made an amended return upon such
as provided for by Sec
ton 2E OF the Act Of October 3.
1918. The evidence clearly shows
that this amended return was made
not earlier than July %, 1919, and
that the assessment OF the additional /
tax claimed was not made until De-
cember. 1919. The plaintiff ayers
that the defendant intends to pro- I
reed to collect the additional taxes /
referred TO in the notice and demand /
OF December 81, 1919. by distress /
and sale OF the plaintiffs lands and I
freehold in the District OF Delaware; |
that the result would be an irrepar- /
able injury 10 the plaintiff and de- |
prive him OF any remedy for con- /
testing the validity OF the assess
ment or the amount thereof. and he .
nravs for an Injunction restraining .
he defendant from distraining or
7tfnmntlnE 10 ulNAA aAN " NN-.NNN 49,
said sum Of 1.576.0155.S6.
II is claimed that under the pro
visions of Section r OF the Income
TAX Act Of 1918. no return could be
made by the Commissioner after the
,xpiration OF three years from March I
H. 1915. and no assessment MADE
.hereon after the expiration OF three
,ears from June 1. 1915. No return
n assessment was made within the
prescribed time.
further objections are that the
alleged return. not made until July
1919. or thereafter. was not MADE
~, the officials authorized by the law
vas not made according to the form
,rescribed. and that the assessment
vas not based upon the alleged re-
urn.
The stock dividend upon which II
= ATTEMPTED to hold the defendant
liable has been held by the Supreme
,ourt 10 be taxable income. o. s.
. Philus $50 October Term. 1921,
p SUP. Ct. So. We have therefore
lawful tax upon income for the
ear 1915 for which the plaintH
hould have made return for that
ear But the plaintiff contends that
no amended return made for him by
he commissioner and the assessment
bereon were not made according 10
aw and. therefore, are invalid ana
hat no suit or proceeding may now
70 brought upon such invalid re-
urn and assessment.
Section f Of the Income Tax Act
Z 1918. 80 stat. at Large 16s. after
for assessment and notice
,efore June l OF each successive
oar and that assessments shall he
-, = -, bafore Time 40 provides