Source: https://thirdcircuit.lexroll.com/a-s-kreider-co-v-united-states-97-f-2d-387-3rd-cir-1938/
Timestamp: 2019-04-23 18:15:01+00:00

Document:
No. 6295.Circuit Court of Appeals, Third Circuit.
May 23, 1938. Rehearing Denied June 27, 1938.
Suit by the A.S. Kreider Company against the United States of America to recover an alleged overassessment of income and profits taxes. Judgment for defendant, and plaintiff appeals.
James W. Morris, Asst. Atty. Gen., and Sewall Key, Norman D. Keller, Clarence E. Dawson, and Lee A. Jackson, Special Assts. to Atty. Gen.
The schedule was received by the taxpayer not later than October, 1929 and was accompanied by a check for $1,362.50, with interest. In March, 1932 the taxpayer instituted suit to recover $13,471.18, with interest, alleged to have been wrongfully withheld by the United States. At this time the Collectors to whom payments had been made were not in office.
It is obvious from an examination of the relevant dates that whether we consider November, 1921, when the original tax was paid, or July, 1926, when the deficiency was assessed and paid, as the date of the last payment, more than five years from the last payment elapsed prior to suit. It is equally obvious that more than two years elapsed from the date of disallowance of the claim for refund.
Inasmuch as the Court below decided the procedural issue without passing upon the merits, the judgment is reversed and the cause remanded to the District Court with directions to consider and determine the merits of the controversy.
Upon March 15, 1921, the appellant filed its income tax for the calendar year 1920 with the Collector of Internal Revenue for the First District of Pennsylvania. The return so made by the appellant showed income tax due and payable by it in the sum of $52,481.97, which it proceeded to pay in four quarterly instalments.
Before June 15, 1926, the appellant filed an income and profits tax waiver, extending the statutory period of limitations for assessment of taxes for the year 1920, to December 31, 1926.
Upon April 10, 1926, the Commissioner of Internal Revenue informed the appellant in the manner prescribed by law that a deficiency existed in tax paid for the year 1920 in the amount of $1,362.50. Upon July 10, 1926, no appeal having been taken by the appellant to the Board of Tax Appeals, the deficiency was duly assessed by the Commissioner. The amount of the additional tax, viz., $1,362.50, was paid by the appellant upon July 28, 1926; that is to say, the appellant completed the payment of taxes for the year 1920 on July 28, 1926. Upon March 25, 1929, the appellant filed a claim for refund for all of the taxes paid for the year 1920, viz., $53,844.47, composed of two items, the $52,481.97 paid in four quarterly instalments and the additional tax paid July 28, 1926, in the sum of $1,362.50.
Upon September 9, 1929, the Commissioner signed a schedule of overassessment showing a “net amount refundable” to the appellant in the sum of $1,362.50, with interest. The certificate of overassessment was duly mailed to the appellant and is set forth in the majority opinion.
A check in the sum of $1,362.50, with interest, accompanied the certificate of overassessment and was received by the appellant at the same time the certificate of overassessment was received.
to be applicable, and rendered judgment for the appellee.
The appellant contends, however, that paragraph 20 of Section 24 of the Judicial Code, the Tucker Act, 28 U.S.C.A. § 41 (20), with its provision for the commencement of actions within six years, governs the action at bar, and that the provisions of Section 3226 of the Revised Statutes, as amended, including the statute of limitations contained therein, heretofore referred to, have no application.
Now the appellant’s statement of demand sets forth that the sum of $13,471.18 is due it by reason of the overassessment in the sum of $14,833.68 expressed upon the certificate of overassessment issued by the Commissioner. Of this total, as we have stated heretofore, $1,362.50 was paid to the appellant. The appellant therefore by the very nature of its pleading bases its cause of action upon the record of the certificate of overassessment, and therefore to recover must bring that cause of action within the rule enunciated by the Supreme Court in Bonwit Teller Co. v. United States, 283 U.S. 258, 265, 51 S.Ct. 395, 397 75 L. Ed. 1018, Daube v. United States, 289 U.S. 367, 372, 53 S.Ct. 597, 599, 77 L.Ed. 1261, and in Stearns Company v. United States, 291 U.S. 54, 65, 54 S.Ct. 325, 329, 78 L.Ed. 647. See, also, United States v. Real Estate Savings Bank, 104 U.S. 728, 733, 26 L.Ed. 908; United States v. Kaufman, 96 U.S. 567, 570, 24 L.Ed. 792.
with the Court of Claims upon the District Courts to entertain suits for sums not exceeding $10,000, founded upon “any contract, express or implied” with the Government of the United States. Suit therefore may be maintained in a District Court under the provisions of the Tucker Act, if the amount involved does not exceed $10,000, provided the circumstances are such as to import a promise of payment by way of refund of tax by the United States and the acceptance of such refund by the taxpayer. If, however, the amount involved in the suit does exceed $10,000, then suit must be brought in the Court of Claims and may not be brought in a District Court.
The amendment of November 23, 1921, to Section 24 (44 Stat. 121, § 1122(c), 28 U.S.C.A. § 41(20), does not permit a District Court to entertain a suit against the United States unless the suit be of such a nature that it could have been brought against the Collector while he was still in office; that is to say, unless the suit is of a personal nature to the Collector. The amendment permits the bringing of only such suits as might have been brought against the Collector if he were still in office. A suit on account stated cannot be brought against a Collector, since a Collector has no power to state an account between the United States and a taxpayer after payment of taxes by the latter or any power to allow a refund to the taxpayer. Moses v. United States, 2 Cir., 61 F.2d 791; Otis Elevator Co. v. United States, D.C., 18 F. Supp. 87. An examination of the record in the case at bar indicates plainly that the suit brought by the appellant is not such a suit as could have been brought against the Collectors of Internal Revenue for the First District of Pennsylvania, to whom the appellant paid its taxes, even had they remained in office, for the appellant’s suit is based upon the certificate of overassessment issued by the Commissioner of Internal Revenue.
relies upon an alleged allowance by the Commissioner of the sum of $14,833.68, as expressed in the certificate of overassessment. An examination of the certificate of overassessment, however, shows that the sum of $13,471.18 was not allowed by the Commissioner. Expressly, it is shown as “barred by statute of limitations”.
There are therefore two reasons why the appellant cannot maintain its suit at bar. It has pleaded a case based upon an account stated and has failed to prove it. It has brought its action in the wrong court, in the District Court instead of in the Court of Claims, since it seeks to recover more than $10,000 upon an account stated.
The judgment of the court below should be affirmed.

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