Wardall v. State

CARTER, J. Plaintiffs in these consolidated cases are licensed by the Board of Equalization (hereinafter referred to as board) as wholesalers and importers of distilled spirits pursuant to the Alcoholic Beverage Control Act (Stats. 1935, p. 1123; Deering’s Gen. Laws, 1935 Supp., Act 3796), and the issue is whether the board-may make a deficiency tax assessment and levy after having previously levied an assessment for the same period.

In the Cavagnaro case, from a report by the board’s auditors after an audit of Cavagnaro’s records, a tax of $647.31 was levied for the period July 1, 1935, to December 31, 1937, and notice thereof sent to Cavagnaro advising him that the levy is “based upon an examination of available records and other information in possession of the Board”; that he could petition for a relevy within 15 days; and that if he failed to do so “the amount of this levy becomes final.” Cavagnaro did not request a relevy and paid the tax. In 1939 the board made an audit of Cavagnaro’s records for the period January 1, 1938, to June 30, 1939. Following consultation between the board’s and Cavagnaro’s auditors it was concluded and the auditors’ report showed that the tax for that period was $18.62, but the notice of levy from the board [641]placed the tax at $294.82, and Cavagnaro petitioned for a re-levy pursuant to section 27b of the act. The board’s decision on such petition was to levy $18.62 for the last mentioned period, $187.49 for the period July 1, 1937, to December 31, 1937, and $72.00 for the period July 1, 1935, to June 30, 1937, that is to say, mating an additional levy of $259.49 for the period first above mentioned.

In the Wardall case substantially the same events transpired.

We thus have a situation in which the taxpayer paid the tax as levied for a certain period. Thereafter he protested the levy for a subsequent period and in the decision rendered therein an additional levy is made for the first period. There is no intimation that the tax so levied was not in fact due under the law; the sole contention is that the assessment and levy for the first period, being uncontested, was final and no further levy could be made by the board.

The Alcoholic Beverage Control Act (supra) embraces the licensing and regulation of the disposal of alcoholic beverages. It imposes a license fee on wholesalers of distilled spirits. In addition “An excise tax is hereby imposed upon all distilled spirits sold in this State by rectifiers or wholesalers thereof, at the following rates: ...” [Emphasis added.] (Stats. 1935, p. 1132, as amended, Stats. 1937, p. 2144, § 24; Deering’s Gen. Laws, 1937, Act 3796.) The method of collecting that tax was by stamps (it has since been changed). “The tax imposed by section 24 of this act upon the sale of distilled spirits shall be collected from rectifiers and wholesalers of distilled spirits and the payment of the tax shall be evidenced by stamps issued by the board to such rectifiers and wholsalers.” (Stats. 1935, p. 1132, as amended, Stats. 1937, p. 2153, § 33; Deering’s Gen. Laws, 1937, Act 3796.) In order to assure the collection of the tax on all spirits sold, the act provided: ‘ ‘ The board may examine the books and records of any person required to make said statement, and may also examine the books and records of any licensee as herein defined, and such books and records shall at all times be subject to the inspection of said board or its representatives during regular business hours.