Opinion ID: 1656664
Heading Depth: 2
Heading Rank: 1

Heading: Whether Appellants failed to exhaust all administrative remedies required by Miss.Code Ann. Section 27-7-71.

Text: ¶ 8. Our holding in Davis v. Barr, 250 Miss. 54, 157 So.2d 505, 508 (1963), requires individuals to exhaust their administrative remedies before resorting to court. With respect to tax issues, failure on the part of one seeking an abatement of his tax assessment to invoke an available administrative remedy, or, if invoked, to pursue the possible administrative appeals to exhaustion, prevents entirely, or in some way limits, his obtaining any relief from the courts with respect to the amount or the legality of the challenged assessment. Id. (quoting 51 Am.Jur., Section 769, p. 698). In Davis, the Appellants not only failed to appeal to the State Tax Commission, but also neglected to post the required bond with their petition in chancery court. Id. at 509 (the applicable statute was Section 9220-31, Code 1942, the predecessor to Section 27-7-73). This Court held that the Tax Commission had exclusive jurisdiction of the income tax assessment due by appellants, and before appellants could invoke the aid of an equity court, it was necessary for them to have first proceeded by the method and through the channel provided by law before the Tax Commission. Id. at 510. ¶ 9. Appellants contend the chancellor erred in finding they had failed to fully exhaust all administrative remedies. Appellants assert that they passed through all the administrative steps required under Section 27-7-71. [14] First, they initiated an appeal to the Tax Commission Review Board within thirty (30) days of the contested action, as required by Section 27-7-71(1). Unsatisfied with the Order of the Review Board, they initiated an appeal to the full Tax Commission within thirty (30) days of the Review Board Order, as required by Section 27-7-71(2). They assert that following the full Tax Commission Order, all further appeals (i.e. the utilization of Section 27-7-73) are judicial in nature. As such, they argue that they exhausted all administrative remedies through their appeals initiated under Section 27-7-71. ¶ 10. The plain language of Section 27-7-71 states: [a]ny tax deficiency, including any penalty and interest, determined by the state tax commission shall be paid within thirty days from the date of notification of the taxpayer, and if said sum is not paid within said thirty-day period, the state tax commission shall proceed to collect same under the provisions of Sections 27-7-55 to 27-7-67; provided within said thirty-day period the taxpayer may appeal from the decision of the state tax commission as hereinafter set out [in Section 27-7-73]. Miss.Code Ann. § 27-7-71 (emphasis added). Upon exhausting the remedies provided under Section 27-7-71, an appeal to the chancery court must be perfected within thirty (30) days of receipt of the Tax Commission findings, as outlined in Section 27-7-73. [15] When the Appellants accepted the Tax Commission determination and paid the tax, the Tax Commission findings became final under Section 27-7-73. Appellants had the option, within thirty (30) days of receiving notification of the Tax Commission determination, of paying the tax or appealing under Section 27-7-73. Under Section 27-7-73, the Tax Commission findings are final unless the taxpayer files a petition in chancery court requesting a hearing of the case on its merits accompanied by a bond in a sum double the amount in controversy. Miss.Code Ann. § 27-7-73. Assuming arguendo that Appellants had exhausted all administrative remedies available under Section 27-7-71, the chancellor's determination that the remedy provided by Section 27-7-73 was not utilized [16] remains unaltered. Because Appellants affirmatively accepted the Tax Commission ruling and paid the tax instead of appealing to the chancery court, this Court finds the Tax Commission ruling became the final adjudication.