Neiman-Marcus Co. v. Commissioner

NEIMAN-MARCUS CO., PETITIONER, v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT.

Neiman-Marcus Co. v. Commissioner

Docket No. 11273.

United States Board of Tax Appeals

13 B.T.A. 1132; 1928 BTA LEXIS 3114;

October 17, 1928, Promulgated

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Under the provision of section 603 of the Revenue Act of 1928, amending subdivisions (c) and (d) of section 1001 of the Revenue Act of 1926, the Board is without authority to approve a bond to stay the collection of a deficiency pending review when such bond is not filed with the Board prior to or at the time the taxpayer files his petition for review.

Donald Horne, Esq., for the petitioner.

C. M. Charest, Esq., and G. L. Blackstrom, Esq., for the respondent.

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LITTLETON

OPINION.

LITTLETON: May 7, 1928, the Board entered its final decision in this proceeding, finding a deficiency for the year 1918 in the amount of $9,415.29 as determined by the Commissioner in his deficiency notice mailed to the taxpayer on November 27, 1925.

August 13 counsel for petitioner filed a motion asking the Board to fix the amount of a bond upon review to the Circuit Court of Appeals of the District of Columbia and on the same date the Board fixed the amount of bond at $18,830.58. September 28, 1928, the taxpayer's petition for review to the Circuit Court of Appeals of the District of Columbia was filed with the Board pursuant to stipulation between the petitioner and the Commissioner signed August 24, 1928, and filed with the Board September 28, 1928. Thereafter, on October 9, 1928, the Board received from counsel for the petitioner a bond executed by the petitioner, by its president, with the American Security Co. of New York, as surety, which bond and surety the petitioner requests the Board to approve to stay collection of the deficiency pending the time when the decision of the Board shall become final under the statute.

Section 603 of the Revenue Act of 1928 approved May 29, 1928, amending subdivisions (c) and (d) of section 1001 of the Revenue Act of 1926, provides, "Notwithstanding any provision of law imposing restrictions on the assessment and collection of deficiencies, such review shall not operate as a stay of assessment or collection of any portion of the amount of the deficiency determined by the Board unless a petition for review in respect of such portion is duly filed by the taxpayer, and then only if the taxpayer (1) on or before the time his petition for review is filed has filed with the Board a bond in a sum fixed by the Board not exceeding double the amount of the portion of the deficiency in respect of which the petition for review is filed, and with surety approved by the Board, conditioned upon the payment of the deficiency as finally determined, together with any interest, additional amounts, or additions to the tax provided for by law, * * *." Under this section the Board has authority to approve the bond and the surety only if such bond is filed prior to or at the time the petition for review is filed. In this proceeding the petition for review was duly filed September 28, 1928, and the bond was not filed until October 9, 1928. When the petition for review is filed with the Board the jurisdiction of the Board over the proceeding and all matters in connection therewith, except the settlement of the transcript on review and the preparation and transmission of the record to the proper court of appeals, is ended, until mandate is received from the appellate court. Under the plain language of the statute the Board is now without authority to approve a bond in this proceeding in connection with the petition for review which has been filed.