Document: 379 U.S. 48 85 S.Ct. 248 13 L.Ed.2d 112 UNITED STATES et al., Petitioners,v.Max POWELL al. No. 54. Argued Oct. 14 and 15, 1964. Decided Nov. 23, Bruce J. Terris, Washington, D.C., for petitioners. Bernard G. Segal, Philadelphia, Pa., respondents. Mr. Justice HARLAN delivered the opinion of Court. 1 In March 1963, Internal Revenue Service, pursuant to powers afforded Commissioner by § 7602(2) Code 1954, summoned respondent Powell appear before Special Agent Tiberino give testimony produce records relating 1958 1959 returns William Penn Laundry (the taxpayer), which was president. appeared agent but refused records. Because taxpayer's had been once previously examined, because three-year statute limitations barred assessment additional deficiencies those years1 except in cases fraud asserted basis this summons),2 contended that he could be forced Service indicate some grounds its belief a committed. The declined any such indication meeting terminated. 2 Thereafter petitioned District Court Eastern Pennsylvania enforcement administrative summons. With petition filed an affidavit stating investigating 1959; based on investigation Regional determined examination years necessary sent letter effect; reason suspect taxpayer fraudulently falsified overstating expenses. At court hearing again stated his objections producing asked show suspicion fraud. chose stand agent's affidavit, and, after argument, ruled given one hour re-examine records.3 3 Appeals reversed, 325 F.2d 914. It reasoned since question only reopened fraud, re-examination must prohibition 7605(b) Code4 against 'unnecessary examination' unless possessed information 'which might cause reasonable man there has return otherwise closed year';5 whether standard met is decided 'on showing made normal course adversary proceeding * *.'6 concluded itself not sufficient satisfy test probable cause.7 Consequently, summons withheld. 4 differing views circuits standards meet obtain judicial orders,8 we granted certiorari, 377 929, 84 1334, 12 294. 5 We reverse, hold Government need make no raises substantial would abusive use court's process, predicated more than fact running ordinary tax liability. I. 6 This brought s 7604(b) Code.9 Reisman v. Caplin, 375 440, 508, 11 459, last Term subsequent rendering decision below, 'was intended cover persons who were wholly default or contumaciously comply.' U.S., at 448, S.Ct., 513. There contumacious refusal case. Thus Government's conceded error bringing under instead 7402(b) 7604(a),10 each grants courts general power enforce Commissioner's summonses 'by appropriate process,' threshold dismiss case force recommence proceedings sections. Since did apply prehearing sanctions attachment arrest peculiar 7604(b), these constitute major substantive differences between sections, think it holding too strictly forms pleading require suit recommenced, therefore treat as having §§ 7604(a). II. 7 Respondent primarily relies establish suspecting existence subject challenge hearing.11 That section provides: 8 'No shall subjected unnecessary investigations, inspection books account taxable year requests Secretary delegate, investigation, notifies writing necessary.' 9 do equate necessity contemplated provision with like notion. If fraudulent returns, liability exists without regard period limitations. Section 7602 authorizes investigate liability.12 If, order determine nonexistence needed already possession, 'unnecessary' within meaning 7605(b). Although stringent interpretation possible, reject seriously hamper carrying out investigations thinks warranted, forcing him litigate prosecute appeals very desires investigate, legislative history indicates severe restriction intended. 10 first 1309 Act 1921, 42 Stat. 310. Its purpose operation explained manager bill, Senator Penrose, Senate floor: 'Mr. PENROSE. President, entirely interest relief from annoyance. income taxes direct have complaint made, especially large centers wealth accumulation money, repeated visits examiners, perhaps are overzealous best judgment exercise their functions. I know many cities country bitter complaints reached me department inquisitions thorough supposed had. purely quieting all trouble peace mind honest taxpayer. WALSH. So up present time inspector visit office individual corporation inspect times chose? And often so. committee seeks limit commissioner further examination? 15 amendment. 16 heartily agree beneficial results amendment will 17 knew amendment, go long way toward relieving petty annoyances part taxpayers.' 61 Cong.Rec. 5855 (Sept. 28, 1921).13 18 Congress recognized curb low-echelon revenue agents, considered simply fully requiring agents clear repetitive superior. For us import enforced substantially overshoot goal legislators sought attain. intimation oversee determinations investigate. No mention limitations14 exception 19 read together sections impose upon expiration date forward. Without solid gloss intended, find unacceptable.15 Our reading said render clause surplusage extent, for, interpreted, adds little beyond relevance materiality requirements 7602. does primary emphasize responsibility prudent wielding extensive them Code.16 20 view reinforced rejection circumstances involving other agencies. Oklahoma Press Pub. Co. Walling, 327 186, 216, 66 494, 509, 90 L.Ed. 614, reference Administrator's subpoena Fair Labor Standards Act, 'his investigative function, searching violations securing essentially same grand jury's, issuing pretrial orders discovery evidence, governed limitations,' accordingly applied inquiry "limited forecasts result investigation." United States Morton Salt Co., 338 632, 642—643, 70 357, 364, 94 401, Federal Trade Commission, 'It inquisition, if chooses call that, derived function. analogous Grand Jury, depend controversy get evidence can merely law being violated, even just wants assurance not.' While derives different body statutes, analogies agency situations when scope called question.17 III. 21 Reading statutes do, summons, either liabilities expired. He conducted legitimate purpose, may relevant steps required followed—in particular, 'Secretary delegate,' notified effect. meaningless entitled ordered.18 'may ground,' 449, 513.19 Nor our mean inquire into underlying reasons examination. process invoked permit abused.20 Such abuse take place issued improper harass put pressure settle collateral dispute, reflecting good faith particular investigation. burden taxpayer, mere showing, case, run examined. 22 remanded consistent opinion. 23 so ordered. 24 Reversed remanded. 25 DOUGLAS, whom STEWART GOLDBERG concur, dissenting. 26 Congress, bars assessments (so far here) U.S.C. 6501(a) (c), 'statute repose'1 respect highly my Brethren. satisfied acting capriciously reopening period. compel production period, insist act capacity, free disagree minimum met.2 27 seem relevant. dealt usual agencies; set action judiciary weigh appraise.3 Id., 215—216, 508—509. Here congressional repose' embodied meaningful protecting invasion fiat. Where expired, presumptively 7605(b)—a presumption overcome. say, 7605(b), shown something caprice believing practiced revenue. safeguard statutory status repose becomes rather meaningless. I.R.C., 6501(a). 6501(c)(1), 'In false intent evade tax, assessed, collection begun assessment, time.' parties subsequently agreed upheld claim right examine cause, one-hour limitation removed. See page 52, infra. 914, 915—916. 916. 'Probable cause' used meant include full range formulations offered lower courts. Compare Foster States, 265 183 (C.A.2d Cir. 1959); Ryan, 320 500 (C.A.6th 1963), affirmed today, 61, 232, O'Connor O'Connell, 253 365 (C.A.1st 1958), followed Lash Nighosian, 273 185 Globe Construction Humphrey, 229 148 (C.A.5th 1956); De Masters Arend, 313 79 (C.A.9th 1963). 'Whenever person 6420(e)(2), 6421(f)(2), neglects refuses obey books, papers, records, data, testimony, required, delegate judge district resides found contempt. duty hear application, satisfactory proof issue attachment, directed proper officer, person, proceed case; deem proper, inconsistent punishment contempts, obedience punish disobedience.' two virtually identical. 'If internal laws appear, testify, jurisdiction attendance, data.' n. 18, 'For ascertaining correctness return, making where none determining equity transferee fiduciary collecting liability, authorized— '(1) To data material inquiry; '(2) summon liable perform act, officer employee custody, care containing entries business named oath, '(3) concerned, inquiry.' Other effect H.R.Rep. 350, 67th Cong., 1st Sess., (1921); S.Rep. 275, 31 5202 (Aug. 1921), remarks Hawley. re-enacted 1926. Senate, substitute measure adopted limited examinations appertaining year. Reed's objection original was: 'By claiming examination, limitation, notice going That, course, done letter,' 67 3856 (Feb. 12, 1926). discussion thought play significant limiting role. ultimately deleted Conference Committee resubstituted. 356, 69th 55. 1939 1954 change elaboration intent. contends re-enacting provision, aware of, acquiesced in, decisions required. re Andrews' Tax Liability, F.Supp. 804 (1937); Zimmermann Wilson, 105 583 (C.A.3d 1939); Brooklyn Pawnbrokers, 39 304 (1941); Martin Chandis Securities 128 731 1942). These represent neither settled construction, see Keegan, 746 (1937), nor sould justified presuming silence, impliedly approved. Shapiro 335 1, 68 1375, 92 1787. 250(d), 265, provided four-year contrary support characterization response.' relieves concern type, means follows limits imposed. appears led astray argued premise governing statute. Davis, Administrative Law, 3.12 (1958). 7604(a) contains specifying procedure invoking jurisdiction, Rules Civil Procedure apply, Cir., 731. instituted filing complaint, answer hearing. comply fears flee application available simultaneously complaint. Jaffe, Judicial Enforcement Orders, 76 Harv.L.Rev. 865 (1963). Senators Smith, Ashurst, Reed 3852—3853. First Circuit requires 'a fraud,' 365, 370; Ninth matter rational particulr case,' 79, 90; Third 'reasonable' eyes where, respects Commission issuance 'special' reports, reserved prevent 'arbitrary' power. 654, 369.

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