Court Opinion

ID: 7370209
Source: CourtListenerOpinion
Date Created: 2022-07-28 00:10:39.954529+00
Date Added: 2024-06-11T13:36:21.718097
License: Public Domain

On the original consideration of this case the court held that the statute levied a use tax on property acquired by the taxpayer for use in the business in which the taxpayer is engaged, affirming the judgment of the lower court which approved the assessment on the basis of its finding of fact and conclusions of law as follows: "It is hereby found and determined that the entire consideration received by Southern Saw Service, Inc., in furnishing the handsaw blades was within the meaning of the Use Tax Act a rental or payment for a license to use said handsaw blades and, accordingly, constitutes the sales price of taxable personal property purchased for use in the State of Alabama within the provisions of the Alabama Use Tax Act."
On rehearing the majority of the Justices concurring, it is held that this finding of fact and conclusion of law is erroneous in that the use tax does not apply to property which the taxpayer uses in the conduct of its business in Alabama and for which it leases to the customer for a stated amount for delivering to the taxpayer's customers sharpened saws and other instruments vesting in the customer a license to use, possess and store the saws and other instruments so delivered, and, therefore, that the finding of fact and conclusion of law by the trial court is erroneous. That the use tax does not apply in such circumstances. The effect of such holding on rehearing is that the reasonable market price of the property as fixed by the judgment of the circuit court is not authorized by the provisions of Section 787, subsection (i), Title 51, Code of 1940, which provides: "The term 'purchase' means acquired for a consideration, whether such acquisition was effected by a transfer of title, or of possession, or of both, or a license to use or consume; whether such transfer shall have been absolute or conditional, and by whatsoever means the same shall have been effected; and whether such consideration be a price or rental in money, or by way of exchange or barter."
From this holding of the majority, I respectfully dissent.
There is no division of opinion in respect to the holding in the original opinion that the alleged taxpayer is not entitled to the exemptions provided in §§ 787, 788, 789(p), Title 51, Code of 1940, quoted in the original opinion, and the conclusion and holding in the original opinion supports the levy of the tax and this holding is supported by the following cases: National Linen Service Corp. v. State Tax Commission,237 Ala. 360, 186 So. 478; Paramount-Richards Theatres, Inc., v. State, 252 Ala. 54, 39 So.2d 380. And the fact that the alleged taxpayer is engaged in business in Alabama is supported by the holding in Boyd v. Warren Paint Color Co., 254 Ala. 687, 49 So.2d 559.
I, therefore, am of opinion that the application for rehearing was erroneously granted by the majority in this case and that said application should be overruled and the levy should stand affirmed. The majority opinion in effect ignores and reads out of the statute and emasculates subsection (i), Section 787, Tit. 51, Code of 1940, defining the word "purchase" within the meaning of the integrated taxing laws. *Page 551