Court Opinion

ID: 9650350
Source: CourtListenerOpinion
Date Created: 2023-08-23 15:32:36.521246+00
Date Added: 2024-06-11T18:12:20.608946
License: Public Domain

LENROOT, Judge.
I dissent from the conclusion- reached by the majority and the reasoning upon which it is based.
My ground of dissent is that the “net amount” of bounty here involved has never been declared by the Secretary of the Treasury as provided by law.
Section 303 of the Tariff Act of 1930 19 U.S.C.A. § 1303, provides in part: “* * * The Secretary of the Treasury shall from time to time ascertain and determine, or estimate, the net amount of each such bounty or grant, and shall declare the net amount so determined or estimated.” (Italics mine.)
The majority opinion holds that T.D. 48360, quoted in full in the majority opinion, was a full compliance with the requirements of section 303, supra, requiring the Secretary to “declare the net amount so determined or estimated.” In my opinion this holding does violence to the plain and unambiguous language of T.D. 48360.
The language therein upon this point reads:
“The liquidation of all entries * * * shall be suspended pending .the declaration of the net total amount of the bounty and/or grant determined or estimated to have been paid and/or bestowed, and the net amount of countervailing duties to be collected. A deposit of estimated countervailing duties shall be required at the time of entry in an amount equal to the percentage of invoice value stated below in connection with the name of the article.
“The articles subject to this notice are as follows:
Article
Percentage of invoice value
******
Surgical instruments............ 56
* * * * * * ”
If this T.D. was a full compliance with the statute, there was no occasion or warrant for the suspension of the liquidation of all entries covering surgical instruments, for section 303 plainly requires that the *365net amount of the bounty “determined or estimated” and declared shall be levied as additional duties.
Under the plain language of T.D. 48360 the liquidation of the entries was suspended “pending the declaration of the net total amount of the bounty and/or grant determined or estimated to have been paid and/or bestowed * * I do not see how language could be plainer that a declaration of the net total amount of the bounty would thereafter be made, and that the liquidation of the entries should be suspended until such declaration should be made.
The 56% estimate of duties provided for in said T.D. clearly had no relation to section 303, but undoubtedly was assumed by the Secretary to be in compliance with section 505, 19 U.S.C.A. § 1505, relating to payment of duties, which provides that a-consignee shall deposit with the collector, at the time of making entry, “the amount of duty estimated to be payable thereon.” The section further provides that the collector shall “fix, and liquidate the rate and amount of duties to be paid” and “collect any increased or additional duties due or refund any excess of duties deposited as determined on such liquidation.” The purpose of the deposit was to protect the revenues of the Government, and it is clear that under said T.D. neither the Government nor the importer was bound by the estimate of 56%.
Under the theory of the majority, if, upon a later declaration of the “net total amount of the bounty * * * ” by the Secretary of the Treasury and assessment thereunder, it appeared that the deposit of estimated duties was in excess of the said “net total amount of the bounty,” a refund would be made, as in the case at bar; but, under that theory, it was equally within the province of the Secretary to increase the net total amount of bounty in any sum, which might equal or exceed 100%, and direct the collection from the importer- of the additional duty.
That the Secretary of the Treasury never intended that the estimate of 56% should be considered as a declaration of the “net total amount of the bounty” is plain from Exhibit 1, quoted in the majority opinion, the same being a letter approved by the Acting Secretary of the Treasury, addressed to the Collector of Customs at Chicago, more than a year after the date of the importation involved. This letter stated in part:
“It has been estimated and it is hereby declared that the net amounts of bounties or grants paid or bestowed with respect to the importations under the first six entries mentioned in the first paragraph of this letter are as follows: (Italics mine.) iji i}C ijC
“Entry No. 2933 $108.11
“You are, accordingly, authorized and directed to assess these amounts as countervailing duties in the liquidation of the entries in question-. Hs sj? s|c . % ;{? 3i
It is conceded that this letter was never published, but was merely a letter of instruction to the collector at Chicago. It does not conform in amount to the estimated duties set out in said T.D., and said letter is the first act of the Secretary purporting to estimate and declare the “net total amount of the bounty * * *.”
This is so plain to me that I am utterly unable to conceive how any other conclusion can be reached.
The majority opinion states: “It is our view that the requirement of á 56% deposit was, within the meaning of the statute, an assessment, although not a final liquidation; that the action following the letter was nothing more than a revision of the amount when the act of liquidation took place, and that it was not essential to the validity of the assessment that the letter be published as a T.D. or otherwise proclaimed to the public. .* * *”
How the requirement of T.D. 48360 that a deposit be made by the importer of estimated countervailing duties, pending a determination and declaration by the Secretary of the “net total amount of the bounty”, can be considered to be an assessment, as stated in the majority opinion, I am wholly unable to understand. It does not purport to be an assessment, but merely requires a deposit to await an assessment to be made at some later date.
The majority opinion recognizes that under section 303 there must have been some publication of the Secretary’s estimate of the net total amount of the bounty, and I am in agreement with this view; but even had Exhibit 1 been published, in my opinion the declaration therein made could not be held to apply to the importation here involved, because made long after the date -of such importation.
*366The declaration of the amount of the bounty, either by a percentage of the invoice price or a fixed sum, must have been in existence at the time of the importation of the goods here involved. This was determined in the case of Franklin Sugar Refining Co. v. United States, 1 Cust.App. 242, T.D. 31276, which involved countervailing duties levied under that provision of section 5 of the Tariff Act of 1897 which read as follows: “ * * * The net amount of all such bounties or grants shall be from .time to time ascertained, determined, and declared by the Secretary of the Treasury, who shall make all needful regulations for the identification of such articles and merchandise and for the assessment and collection of such additional duties.”
It will be observed that this provision is substantially the same as the provision of section 303, supra, relating to the duties of the Secretary of the Treasury, except that in the latter section the term “estimate” is included, which term is not found in section 5 of the act of 1897. This, however, in my opinion is not material here for the reason that, while section 303 provides that the Secretary shall ascertain and determine or “estimate” the net amount of the bounty, it also provides that he shall also “declare the net amount so determined or estimated.”
In the Franklin Sugar Co. case, supra, certain importations of raw beet sugar were made. At the time of such importations there was in existence a determination and declaration by the Secretary of the Treasury of a bounty upon such sugar under the law of Germany of 2.50 marks per 100 kilos. Subsequent to said importations, and prior to the liquidations of the entries respecting them, the Secretary of the Treasury made a new ascertainment and declaration of the bounty allowed by Germany and fixed the same at 2.40 marks per 100 kilos. The importer claimed that the liquidations should have been made upon the basis of 2.40 marks per 100 kilos. The court held that the determination and declaration in existence at the time of importation should govern the amount of duty, and not the second declaration in effect at the time of the liquidation of the entries.
The court in its opinion stated:
“The questions presented are, first, whether the rate as determined and in force at the time of the importation should govern, or whether, on the other hand, the determination at the date of the final liquidation should be adopted; second, whether it is competent to show by independent testimony, or by the fact of a later determination coupled with testimony showing that the law in force in Germany at the time of the first determination had not been changed, that the rate of 2.40 marks per 100 kilos was in fact the correct rate, and that therefore the orders of July, 1897, and September, 1897, should be disregarded.
“We think the language of section 5 of the act of 1897 makes it very clear that the additional duty shall be levied and paid upon the importation of the article. The obligation then arising to pay the tax on the importation, the fact that this final payment in liquidation of liability is postponed, does not affect that liability. í¡í }{i j|< i}i
“Congress might have left it open in each case for proof to be offered and for the collector in each case to determine what the actual bounty paid by the country of origin was; but Congress saw fit in its wisdom to provide that there should be uniformity in all ports of entry in the country, and as to all importers, and therefore that the amount of bounty paid upon exportation's of sugar should be ascertained and declared by the collector of customs. Manifestly this would be of little value if it could be controverted on every importation. Uniformity would not be obtained under such circumstances, nor would a subsequent modification of the determination by the Secretary of theTreasury work out uniformity if it were permitted to be applied in one case and not in all. The statute itself contemplates that there may be changes in the foreign law, or that further information may lead to a modification of the orders, as it is directed that the Secretary of the Treasury shall from time to time ascertain, determine, and declare the net amount of such bounties, and make the needful regulations, etc. See also United States v. Klingenberg (153 U.S. 93 [14 S.Ct. 790, 38 L.Ed. 647]) and Hadden v. Merritt (115 U.S. 25 [5 S.Ct. 1169, 29 L.Ed. 333]).”
The court concluded its opinion with the following: “We think, however, that the reason upon which the cases rest involves the proposition that the delegation of this power to the Secretary of the Treasury is as much for the purpose of securing uniformity throughout the various ports of entry of the country and to advise the inporter of the exact amount of the countervailing duty at the time of the importation as it is to reach the correct result. As is indicated by the quotation from the case of Cramer v. *367Arthur [102 U.S. 612, 26 L.Ed. 259] (supra), the delegation of this power was for the purpose of avoiding confusion and uncertainty and to reach a result which should be final and conclusive.” (Italics mine.)
The Franklin Sugar Co. case, supra, was decided in 1911; since that time three tariff bills have been enacted by Congress, and with the exception of the addition of the provision for estimating in section 303 of the Tariff Act of 1930, all of these subsequent tariff acts have contained provisions substantially identical with the provision construed in said Franklin Sugar Co. case.
That case having decided that bounties the subject of countervailing duties must have been declared at the time of importation of merchandise subject thereto, and Congress, presumably having knowledge of such decision, having made no substantial change in similar provisions in subsequent tariff acts, the doctrine of legislative adoption of judicial decision is applicable and the decision in the said case should be regarded as controlling upon the question of whether a countervailing duty may be levied with respect to any importation prior to the declaration of the net total amount of the bounty made the basis of the countervailing duty.
Of course the Treasury Department is bound by the law, and it is clear to me that T. D. 48360 is clearly a departure therefrom.
The Secretary could have fully protected the Government by declaring the net total amount of the bounty in said T. D. 48360; but he did not do so, and clearly did not intend to do so. If the Secretary had done so, and later concluded that the net total amount of the bounty so declared was too high, he could, by a new published declaration, reduce the amount of the bounty, which would be applicable to importations made subsequent to such second declaration.
For the reasons I have stated, I am of the opinion that the judgment appealed from should be reversed.
I am authorized to say that Judge HATFIELD concurs in the views herein expressed.