Case Name: Bastrop Mercantile Co., Ltd., Petitioner, v. Commissioner of Internal Revenue, Respondent
Court: United States Board of Tax Appeals
Jurisdiction: United States
Decision Date: 1927-06-24
Citations: 7 B.T.A. 529
Docket Number: Docket No. 8124
Parties: Bastrop Mercantile Co., Ltd., Petitioner, v. Commissioner of Internal Revenue, Respondent.
Judges: 
Reporter: Reports of the United States Board of Tax Appeals
Volume: 7
Pages: 529–532

Head Matter:
Bastrop Mercantile Co., Ltd., Petitioner, v. Commissioner of Internal Revenue, Respondent.
Docket No. 8124.
Promulgated June 24, 1927.
P. J. Guepet, G. P. A., for the petitioner.
Jos. K. Moyer, Esq., for the respondent.

Opinion:
OPINION.
Love:
The sole issue presented in this proceeding is whether the respondent was, in January, 1925, barred by the statute of limitations from asserting and assessing income and profits taxes against the petitioner for the fiscal year ended January 31, 1919, a return for that period having been filed on June 2, 1919, the return, how ever, being captioned "For calendar year 1918 or Fiscal period begun — and ended-1918."
The respondent contends that the petitioner did not file a return for the fiscal year ended January 31,1919, and that he was not barred in January, 1925, from making an assessment of a deficiency in tax for that fiscal year. We believe that this contention is without merit.
The return filed by the petitioner on June 2, 1919, was, it is true, captioned improperly, but nevertheless that return did contain the figures taken from the petitioner's books for the fiscal period ended January 31, 1919, and from the information submitted on and with that return the respondent determined a deficiency in tax for the period ended January 31, 1919, -which deficiency he assessed in January, 1925, more than five years after the return was filed. The fact that the return was improperly captioned certainly is not controlling. The return filed on June 2, 1919, purported to be made in accordance with the law; it did include the income of the petitioner for the period in question. There is no suggestion of fraud on the part of the petitioner in making the return.
The reasoning of the Board in the Appeal of Mabel Elevator Co., 2 B. T. A. 517, would appear to be pertinent to the question involved in this proceeding.
In that appeal, the taxpayer filed its return on the basis of a fiscal year, and the respondent contended that the law required a return on a calendar year basis and therefore the return filed was not a return required by law against which the statute of limitations would run. In disposing of the respondent's contention the Board reasoned as follows:
The return filed purported to be made In accordance with the law; it purported to and did include the income of the taxpayer for the period in question. In the absence of any evidence or claim that such return was false or fraudulent with intent to evade tax, it became the duty of the Commissioner to determine, within the time prescribed by law, whether or not such return was erroneous in any respect.
When this case was brought before the United States District Court for the District of Minnesota, the court approved the Board's conclusions. United States v. Mabel Elevator Co., 17 Fed. (2d) 109.
We think that the return filed on June 2, 1919, was a proper return under the statute for the fiscal period ended January 31, 1919.
Section 277 (a) (2) of the Revenue Act of 1924 provides that the amount of income or profits taxes imposed by "the Revenue Act of 1917, the Revenue Act of 1918, and by any such Act as amended shall be assessed within five years after the return was filed." It is agreed that the assessment of the taxes in question was made in January, 1925, more than five years after the return was filed. The respondent, therefore, was barred in January, 1925, from making the assessment by operation of the statute of limitations.
Judgment will he entered for the 'petitioner.