Majority — Brand J.
delivered the opinion of the Court.
On April 1, 1918, W. P. Brown & Sons Lumber Company filed its income and profits tax return for the year 1917. The tax thereon was duly paid. On March 6, 1923, the Bureau of Internal Revenue duly mailed to the taxpayer notice of a deficiency. A timely appeal was taken to the Commissioner who had meanwhile, in March, 1923, made a jeopardy assessment. On March 27, 1923, the taxpayer filed a claim for abatement. On June 4, 1924, this claim and the appeal were sent by the Income Tax Unit to the Committee on Appeals and Review.[1] On October 28, 1925, the Commissioner duly mailed to the taxpayer notice of his determination, the claim for abatement being allowed in part and rejected in part. On November 18, 1925, the taxpayer appealed to the Board of Tax Appeals for a redetermination of the deficiency. There the parties stipulated the amount of the additional tax, and submitted the question whether it was barred by the statute of limitations. The. Board held that it was not, 13 B. T. A. 1425 ; and its decision was affirmed by the Circuit Court of Appeals, 38 F. (2d) 425 . This Court granted a writ of certiorari, the briefs and arguments to be “ limited to the question of the validity and effect of the waivers.” 281 U. S. 718 .
The jeopardy assessment was clearly made in time. The return was filed April 1, 1918; the assessment was
The sole question for discussion is whether the right of collection has been barred under § 250 (d) of the Revenue Act of 1921 which imposed a five year limitation on col
2 There was doubt whether the 1916 and 1917 Acts required the Commissioner both to discover the error in the return and to make an additional assessment, or merely to make discovery, within three' years. Revenue Act' of 1916, c. 463, § 14 (a), 39 Stat. 756 , 772, incorporated' by reference into Revenue Act of 1917, c. 63, § 206 (c), 40 Stat. 300 , 305. At that time, the Commissioner thought it sufficient that he • discover the error within the three years. See Reg. 33 (Rev. ed. 1918) Art. 233. Compare Eliot National Bank v. Gill, 218 Fed. 600 , 602; United States v. Nashville, C. & St. L. Ry., 249 Fed. 678 , 682; Du Pont v. Graham, 283 Fed. 300 , 302, reversed on other grounds, 262 17. S. 234. Section 250 (d) of the. 1921 Act extended this period for assessment to five years, (compare United States v. Chicago & E. I. Ry., 298 Fed. 779 ), but provided that the time run from the filing of the return.
3 This waiver was unlimited in time but expired April 1, 1924, under a departmental ruling promulgated April 11, 1923, Mim. 3085, I. R. Cum. Bull. II-1, p. 174. See Aiken v. Burnet, decided this day, ante, p. 279, note 1.
4 Inasmuch as the second and third waivers were in themselves' sufficient to extend the period for collection, the first waiver may be disregarded in this connection, as was done by the lower court. See 38 F. (2d) 428 .
Whether the right of collection became barred thereafter depends upon the construction to be given to the' applicable statutes. The taxpayer contends that the. right of collection was barred on December 10, 1925, that is twenty-two days after the appeal to the Board of Tax Appeals had been taken, although this appeal was then pending -Without having been heard, and indeed could not have been heard under the practice of the Board. See Rule 15, 1 B. T. A. 1289 ; Rulés 24-25, 7 B. T. A. 1361 -62. Besides the Act of 1921, provisions-of thé Revenue Act of 1924 and of the Revenue Act of 1926 are relied upon.The argument, is that despite the appeal to the Board, the Commissioner was at all times at liberty to enforce .payment of the tax as assessed by the jeopardy assessment or as later reduced; that hence, collection was barred on December 10, 1925, by § 250 (d) of the 1921 Act; and that there was nothing in either the Revenue Act of June 2,1924, c. 234, 43 St. 253 or the Revenue Act of February 26, 1926, c. 27, 44 Stat. 9 , which kept alive the* right of collection. The Board of Tax Appeals rested it.s decision on provisions of the 1924 Act;[4] the Circuit Court of Appeals on those and also on the 1926 Act. Only the latter act need be considered.
Section 283 <■ (f) of the Revenue Act of 1926, 44 Stat. 64 , provided:'
5 It relied upon G. L. Ramsey v. Commissioner, 11 B. T. A. 345 , where it has held that on a jeopardy assessment which had been made within the five year period as extended by a valid waiver, the Commissioner had, under § 278 (d) of the Revenue Act of 1924, six years after the assessment within which to commence proceedings for collection, even though the parties had agreed in the waiver for-a' different period for collection. The Board held further that there was nothing in § 278 (d) of the Revenue Act of 1926 which restricted this period to. that mentioned in the waiver. ■
“ If any deficiency [in any 1916-21 income or profits taxes] . . . was assessed before June 3, 1924, but was not paid in full before that date, and if. the Commissioner after June 2,1924, but before the enactment of this Act finally determined the amount of the deficiency, and if the person liable for such tax appealed before the enactment of this Act to the Board and the appeal is pending., before the-Board at the time of the enactment of thiá Act, the Board shall have jurisdiction of the appeal. In all such cases the powers, duties, rights, and privileges of the Commissioner and of the person who has brought the appeal, and the jurisdiction of the Board and of the courts, shall be determined ... in the same manner as provided in subdivision (e) of this section. . . .”[5]
This section is applicable to the case at bar. The deficiency was assessed in March, 1923; and hence before “ June 3, 1924,” “ and was not paid.” On October 28, 1925, between the effective dates of the 1924 and the 1926 Acts, the Commissioner finally determined the amount of the deficiency; and on November 18, 1925, also prior to the enactment of the 1926 Act, the taxpayer appealed to the Board of Tax Appeals. One effect of the section was to confirm the jurisdiction of the Board.[6] Another
6 Somewhat similar provisions relating to like cases under prior estate and gift tax statutes were enacted at the same time. See Revenue Act of 1926, c. 27, §§ 318, (d), (e), and (f), 44 Stat. 9 , 82-83; De Sabichi v. Commissioner, 4 B. T. A. 445 .
7 Although some doubt was expressed in Appeal'of Reynolds & Reynolds Co., 1 B. T. A. 275 , the Board of Tax Appeals very early took jurisdiction in these cases. Appeal of Joseph Garneau Co., Inc., 1 B. T. A. 75 ; Appeal of Ormsby McKnight Mitchell, 1 B. T. A. 143 ; Appeal of Boston Structural Steel Co., 1 B. T. A. 602 ; Appeal of Buffalo Slag Co., 1 B. T. A. 749 . Compare Appeal of Terminal Wine Co., 1 B. T. A. 697 . Following the Act of 1926, the Board has uniformly held that § 283 (f) confirmed its jurisdiction. See Appeal of Covert Gear Co., 4 B. T. A. 1025 ; Appeal of Elizabeth W. Strana- *290 han, 4 B. T. A. 1141 ; Appeal of Nice Ball Bearing Co., 5 B. T. A. 484 ; Appeal pf Slater Mills, Inc., 5 B. T. A. 971 ; Appeal of Ocean Accident & Guarantee Corp., 6 B. T. A. 1045 ; Reliance Mfg. Co. v. Commissioner, 7 B. T, A. 583 . Such was clearly the legislative purpose of the section. See Hearings Before the Committee on Ways and Means on Revenue Revision of 1925, 69th Cong., 1st Sess., pp; 898, et seq., particularly the statement of the Board Chairman, Charles D. Hamel, p. 923; H. Rep. No. 1, id., December 7, Í925, p. 13; Sen. Rep. No. 52, id., January 16, 1926, p. 32; Conference Report, H. Rep. No. 356, id., February 22, 1926, pp. 46-47.
8 Subdivision (f) of § 283 refers to subdivision (e). That section provides that the situation dealt with therein should be treated as, though a deficiency notice had been sent under § 274 (a), and that the tax “ shall be collected and paid in the same manner and subject to the same provisions and limitations . . . as in -the ease of a deficiency imposed [by the 1926 Act], except as otherwise provided in section 277,” and in certain sections relating to interest andjeopr ardy collection, which are here immaterial. 44 Stat. 64 . Deficiencies under the 1926 Act were governed by §§ 273, 274, and 275, 44 Stat. 55 -57. Section 273, defining the term, and § 275, providing for additions in the case of negligence, fraud, etc., are not here applicable; Section 274 (a) is quoted in the text. Section 277 (a) related to the-periods for assessment and collection generally and reenacted the five year limitation on the collection of 1917 taxes. It was qualified by § 277 (b), quoted in the text. Section 283 (f) was, in addition, limited by § 283 (j) which prohibited an appeal to the Circuit Court of Appeals if the hearing before the'Board had been held prior to the enactment of the 1926 Act. Blair v. Curran, 24 F. (2d) 390 ; Blair v. Hendricks, 24 F. (2d) 819 ; Power & Bro. v. Commissioner, 27 F. (2d) 116 . In the case at bar, the hearing was held on April 26, 1928. Also, § 284 (d), 44 Stat. 67 , which imposed restrictions on the allowance of refunds and credits after an appeal had been taken to the Board of Tax Appeals, was made inapplicable to cases under § 283 (f). Compare Burnet v. Chicago Railway Equipment Co., decided this day, post, p. 301, note 8.
First. It is argued that § 283 (f) cannot be interpreted as extending the time for the collection of the tax because of § 1000.[11] The latter section amended the 1924 Act by providing that where the Board found that the tax was barred by the statute of limitations, its decision should be that there was no deficiency. This section was inserted
9 44 Stat. 55 . Notwithstanding the prohibition in R. S. 3224, such suit or distraint proceeding may, by express provision in § 274 (a), be enjoined. Peerless Woolen Mills v. Rose, 28 F. (2d) 661 .
10 44 Stat. 58 -59.
11 Section 274 (h), 44 Stat. 56 , provided that the decision of the Board should become final according to the rules set out in § 1005. That section provides that finality shall be given thirty days after the issuance of the mandate of this Court, in case of an affirmance or dismissal, or upon correction in case of a modification or reversal. 44 Stat. Ill; 26 U. S. C., § 1228.
12 44 Stat. 105 , 107. This section was a general amendment to Title IX of the Revenue Act of 1924. An entire new section, § 906, was,-inter alia, thereby added to the 1924 Act, of which subdivision (e) is relied upon by respondent.
Second. It is argued that neither § 277 (b), which suspended the running of the statute, nor § .283 (f), which incorporated the former,[13] indicate that § 277 (b) was to be given a retroactive effect. The argument is unsound. Subdivision (f) of § 283 shows that it was the intention of Congress tohpply the provisions of § 277 (b) to cases like that at bar/ , ’ Since in such . cases the assessment (before June 3,1924), the final determination and the appeal to. the'Board (after June .2, 1924), must expressly have Oisteurred prior to the enactment of the 1926 Act, the reference to. § 277 (b) .contained in § .283 (f)'necessarily meant that in these cases the former section was to. be applied retroactively;
Third. The taxpayer.;,relies also upon § 278 (e)[14] of the 1926 Act which prohibited collection, in the absence of a waiver prior to that Act, if at. the date of its enact-iiaent the tax was already barred. The argument is that since the last waiver by its terms expired on December 10, 1925, that is, prior to the effective date of the 1926
13 See Hearings Before Committee oil Ways and Means on Revenue Revision of 1925, supra, note 7, pp. 849, et sp,q., 900-02. The Board had early decided that it had jurisdiction .a such cases under § 900 of the Í924 Act*- Appeal of National Refining Co., 1 B. T. A. 236 . Compare note 12, supra.
14 See noté 8, supra.
15 “ This section' . . . shall [not] authorize . .. . the collection [of .a tax] (1) if at the time of- the enactment of this Act [such collection] was barred ... ., unless prior to the enactment of this Act the Commissioner and the taxpayer agreed in writing thereto, or (2) contrary to the provisions of subdivision (a) of section 274 of this Act.” 44Stat..59,
Fourth. It is argued that inasmuch as the Commissioner was not prohibited from making collection between November 18, 1925, the date of the appeal, and February 26, T926, the effective date of the 1926 Act,[16] and since
16 As was pointed out below, the latter part of § 278 (e), which prohibits collection contrary to § 274 (a), quoted supra p. 290, recognizes and, reinforces the prohibition against collection' while a case is pending before the Board. See note 9, supra. Since this same subsection 274 (a) is incorporated in § 283- (f), supra note 8, it seems clear from this interrelation that § 278 (e) was not intended to limit § 283 (f), and that the suspension of the statute given by § 277 (b) is applicable to the instant ease. See 38 F. (2d) 431 .
17 The filing of the claim for abatement of the jeopardy assessment did not operate as a stay of collection. The claim filed in the present case,, under § 252 of the 1921 Act ( 42 Stat. 268 ) and R. S. 3228 as ámended by § 1316 of that Act ( 42 Stat. 314 )', was apparently riot accompanied by a bond. Under such circumstances the filing of the-claim would not have prevented collection if the Commissioner had believed that collection of the tax was jeopardized. See Reg. 33 (1918 ed.), Art. 261; Reg. 45, Art. 1032; Reg. 62, Art. 1032; cf. United States v. Burden, Smith & Co., 33 F. (2d) 229 , 230. Prior to the.decision in Bowers v. N. Y. & Albany Lighterage Co., 273 U. S. 346 , it was, however, the common practice to postpone collection upon the filing of a claim for abatement if there was no doubt as to the taxpayer’s solvency. .See H. Rep. No. 2, 70th Cong. 1st Sess., December 7, 1927, p. 34,
Affii*med.
18 44 Stat. 66 .
19 Sea § 279 of the Revenue Act of 1924, c. 234, 43 Stat. 253 , 300. Compare § 283 (b) and (c) of the 1926 Act. These sections confirmed the jurisdiction of the Board in cases in which an assessment had been made and an appeal taken, or in which the 60-day period had not expired before the 1926 Act. Compare Plains Buying & Selling Ass’n. v. Commissioner, 5 B. T. A. 1147 , 1153. In such cases a.jeopardy assessment and claim for abatement, accompanied by a bond and, providing for a stay of collection, between the 1924 and 1926 Acts, would have been possible, and § 283 (1) would have applied,
Cases cited
- New York Life Insurance v. Bowers 281 U. S. 718 p. 285