Citation Numbers: 276 Mass. 475
Judges: Sanderson
Filed Date: 9/10/1931
Status: Precedential
Modified Date: 6/25/2022
The petitioner,-a safe deposit company incorporated under G. L. c. 158, and subject to an excise tax upon the value of its franchise under G. L. c. 63, §§ 53-60, inclusive, filed this petition under G. L. c. 63, § 77, for the abatement of a portion of its tax for the year 1928, its contention being that the value of its bonds, secured by mortgages on Massachusetts real estate, the mortgages being held by trustees for the bondholders, should have been deducted from the market value of the shares of its corporate stock in ascertaining the valuation on which the excise tax should be assessed. The parties stipulated with the assent of the single justice that in each instance the mortgagee’s interest as represented by the bonds which the mortgage secures is less than the actual and assessed value of the mortgaged real estate. A demurrer based upon the ground that the petition did not state a cause of action was sustained and the petitioner appealed from a final decree dismissing the petition.
G. L. c. 63, § 55, as amended by St. 1926, c. 279, § 6, Fifth, provides in part that from the market value of the shares constituting the capital stock of corporations subject to a franchise tax in accordance with its provisions, a deduction shall be made of “the value as found by the commissioner of their . . . real estate . . . subject to local taxation wherever situated.” The only deductions which may be made in determining the value of the franchise of a corporation taxable under G. L. c. 63, § 58, are those for
In the case at bar the petitioner is not the holder of any of the mortgages securing the bonds, nor is it taxable as mortgagee. Neither the mortgages nor the bonds which they secure are the petitioner’s real estate within the meaning of the statute. The section of the statute providing for the deduction refers to legal ownership of real estate rather than to an equitable and nonassessable interest and does not authorize the deduction sought by the petitioner. It is not material that the bonds would not be taxable if owned by an individual (Knight v. Boston, 159 Mass. 551) or that they would be deductible under the provisions made for business corporations, G. L. c. 63, § 30, els. 3 (b), 4 (b), or that the value of the bonds may to some extent increase the market value of the corporate shares. Commonwealth v. Hamilton Manuf. Co, 12 Allen, 298, 306. The terms of
Decree affirmed with costs.