Opinion ID: 1921823
Heading Depth: 1
Heading Rank: 2

Heading: alteration of excise tax reports

Text: The second question presented by the Company is whether the Director of the Division of Taxation without statutory authority materially altered the Company's excise tax returns for the years 1948, 1949 and 1950. The applicable statutory provision is contained in L. 1940, c. 5, sec. 7, par. ( D ), as amended by L. 1941, c. 21, sec. 3, N.J.S.A. 54:31-51( D ), which reads: (D) The State Tax Commissioner shall audit and verify the statements filed by taxpayers whenever and in such respects as he shall deem necessary or advisable. The State Tax Commissioner may require any taxpayer to supply additional data and information in such form and detail as he shall request, whenever he may deem it necessary or helpful, for the proper performance of his duties under this act. The word audit is not one of easy or uniform definition. A recent and pertinent definition appears in Application of Sullivan, 297 N.Y. 190, 78 N.E. 2 d 467, 469 ( Ct. App. 1948) as follows: The word `audit' may connote different processes depending upon the context of the statute, the charge involved and the purpose to be served. A good statement of the rule may be found in 7 Corpus Juris Secundum, Audit, pages 1274, 1275, which is in part as follows: `It has been said that the true meaning of the word in a particular case is to be ascertained from the context, all surrounding facts, and the purpose to be accomplished, that sometimes it is restricted in meaning to a check-up of the correctness of the account or claim and excludes any element of discretion on the part of the auditor; that at other times, it may embrace not only an examination of accounts and a comparison of charges with vouchers, but also an allowance or rejection of charges and a statement of balance for the purpose of determining the amount, if any, to be paid thereon, involving an exercise of discretion by the auditing officer or board;    (Emphasis supplied.) See numerous other references digested and collected in 4 Words & Phrases ( Perm. ed. 1940), pp. 810 et seq. The word verify also has several meanings, a pertinent one is: to prove to be true or correct; to establish the truth of; to confirm. United States Fidelity & Guaranty Co. v. Downey, 38 Colo. 414, 88 P. 451, 452, 10 L.R.A., N.S., 323, 120 Am. St. Rep. 128 ( Sup. Ct. 1907); cf. City of Houston v. Quinones, 172 S.W. 2 d 187, 190 ( Tex. Civ. App. 1943); National Surety Corporation v. Lybrand, 256 App. Div. 226, 9 N.Y.S. 2 d 554, 561 ( App. Div. 1939); MacNeill v. Maddox, 194 Ga. 802, 22 S.E. 2 d 653, 654 ( Sup. Ct. 1942). See also 44 Words & Phrases ( Perm. ed. 1940), pp. 138 et seq. The alleged alterations in the excise tax reports of the Company appear to be mere notations thereon of the director's conclusions. Under the language of L. 1941, c. 5, sec. 7, par. ( D ), supra, the director is authorized to make the same. Otherwise the duty placed on him to audit and verify statements or such reports whenever and in such respects as he shall deem necessary and in that connection to require a taxpayer to supply such additional data as he may request, is without meaning. The Company's argument is without merit.