Opinion ID: 1956142
Heading Depth: 1
Heading Rank: 2

Heading: Federal Tax Returns

Text: During the years 1942 to 1954 inclusive Bennethum was in receipt of income sufficient to require him to file federal tax returns. Prior to 1947 he was an employed associate of a Wilmington law firm and also received a salary from the State during all of these years except one. In 1947 he became a partner. His income from the partnership from 1947 to 1954 ranged from $11,000 to $16,000 annually. According to the records of the District Director of Internal Revenue, Bennethum filed no return and paid no tax for any of the years 1942 to 1954. A subsequent computation showed a tax liability for the years 1945-1954 of $22,831, exclusive of penalties. Sometime in 1955 the Internal Revenue Service began an investigation of Bennethum's income tax liability. On October 13 the District Director wrote him about the matter. On November 9 an agent called Bennethum on the telephone and inquired whether he had filed a return for 1954, and Bennethum replied in the affirmative. According to the agent, Bennethum said that he had paid the tax by check. Bennethum later denied having made that statement. According to the agent Bennethum, at the agent's request, agreed to produce the check and said that he would call back. He did not call back. In December, 1955, two agents called to see him and he showed them papers which he stated were copies of his returns for the years 1952, 1953, and 1954. On June 15, 1956, the Intelligence Division formally advised Bennethum that its investigation indicated that he had failed to file returns for the five years 1950-1954, and that consideration was being given to possible criminal proceedings. An opportunity for a conference was afforded. The conference was held July 18. Bennethum was questioned under oath. He testified that he had filed an income tax return with the Wilmington office for each of the years 1942 to 1949. On March 8, 1957, Bennethum was indicted in the United States District Court for failure to file returns for the years 1953 and 1954. His trial took place in December of that year before a judge without a jury. The Government witnesses testified that the files of the Internal Revenue Service at Wilmington contained no record of any return for any of the years 1942-1954, and no record of any payment of tax. Bennethum testified he had filed returns for 1953 and 1954 and that the copies given to the agents were correct copies of the filed returns. He also relied on the fact that for the years in question he had signed the partnership information returns, which disclosed that he had received income from the partnership. Judge Grimm in delivering his verdict said that he had a reasonable doubt of guilt. The grounds for his decision will be hereafter considered. The criminal trial dealt only with wilful failure to file returns for the two years 1953-1954. There is before us, however, the question whether he failed to file for the 13 years 1942-1954, and the far more serious questions whether Bennethum's testimony in the case, his sworn statements to the agents, and his testimony before the Censor Committee were false, and whether the purported copies of tax returns for those two years were fabricated.