gether with their actual and necessary traveling expenses, and also a reasonable allowance for their board bills, to be fixed by the Commissioner of Internal Revenue, but not to exceed $2 per diem for said board bills.] That bonds hereafter given under the provisions of the aforesaid Act of October first, eighteen hundred and ninety, as amended, shall be conditioned for the payment of the tax on all brandy removed thereunder and not used and accounted for within the time and in the manner required by law and regulations, and for the payment of all taxes imposed on the brandy so withdrawn and used for fortifications; and the said bonds shall contain such other conditions as the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, may by regulation prescribe. (38 Stat. 750.) For discussion as to possible repeal or supersession of this section, see notes under 6115, ante. Act June 7, 1906, c. 3046, § 3, amended hereby, after the words "board bills" contained the clause "and to cover the expenses to the Government attending the making and fortification of such sweet wines there shall be levied and assessed against each maker of such wines, and collected monthly, a charge of three cents on each taxable gallon of brandy used by him in the fortification of such wines during the preceding month," and in other respects was in the language of the amendatory act, except that the word "charges" is used in place of the word "taxes," and the words "for fortifications" after the words "withdrawn and used" are omitted. The provisions relating to bonds on withdrawal of wine spirits from warehouse, made by Act Oct. 1, 1890, c. 1244, §§ 45, 46, referred to in this section, are set forth ante, §§ 6114, 6115. The words in brackets are superseded by a provision of Act Sept. 8, 1916, c. 463, § 402(g), ante, § 6114d. § 6120. (Act June 7, 1906, c. 3046, § 4.) Fermenting vats for manufacture of wines or of brandy for fortification thereof. Where brandy to be used in the fortification of wine is distilléd on premises adjacent to the winery premises the Commissioner of Internal Revenue may, in his discretion, authorize the erection on either of said premises of fermenting vats for material to be used either in the manufacture of such wines or the brandy to be used in the fortification thereof; and all such materials used or received on either of said premises shall be under the supervision of the officer assigned to such winery, and shall be accounted for at such times and in such manner as the Commissioner may direct. (34 Stat. 216.) § 6121. (Act June 7, 1906, c. 3046, § 5.) grape brandy accidentally destroyed. Remission of tax on The provisions of sections thirty-two hundred and twentyone and thirty-two hundred and twenty-three of the Revised Statutes of the United States, as amended by an Act approved March first, eighteen hundred and seventy-nine, are hereby extended to grape brandy withdrawn for use in the fortification of sweet wines, and which, prior to such use, is accidentally destroyed by fire or other casualty while stored in the fortifying room on the winery premises. (34 Stat. 216.) R. S. §§ 3221 and 3223, as amended by Act March 1, 1879, c. 125, mentioned in this section, which provided for the remission of tax on spirits accidentally destroyed, are set forth ante, §§ 5945, 5946. § 6122. (Act June 7, 1906, c. 3046, § 6, as amended, Act Oct. 22, 1914, c. 331, § 2.) Unlawful recovery of spirits from fortified wines; penalty; blending fortified wines. Any person who by any process recovers from wines fortified under the provisions of the aforesaid Act approved October first, eighteen hundred and ninety, as amendments thereto, any brandy or wine spirits used in the manufacture or fortification of said wine, otherwise than is provided for in said Act and its amend ments, or who shall rectify, mix, or compound with distilled spirits. or other materials, except as provided in this Act, such grape brandy, fortified wines or wine spirits unlawfully recovered therefrom, shall, on conviction, be punished for each such offense by a fine of not less than $200 nor more than $1,000. But the provisions of this section and the provisions of section thirty-two hundred and forty-four of the Revised Statutes of the United States, as amended, relating to rectification, or other internal revenue laws. of the United States, shall not be held to apply to or prohibit the mixing or blending of pure sweet wines fortified under the provisions of this Act with each other or with other wines: Provided, That the pure sweet wines fortified under the provisions of this Act may be used in the manufacture of cordials, liqueurs, and similar compounds on which an internal revenue tax of 24 cents a gallon is imposed, and otherwise the provision of section thirtytwo hundred and forty-four of the Revised Statutes of the United States shall remain in full force and effect. (38 Stat. 750.) For suggestion as to repeal or supersession of this section, see note under § 6115, ante. Act June 7, 1906, c. 3046, § 6, 34 Stat. 216, amended hereby, read as follows: "Any person who by any process recovers from wines fortified under the provisions of the aforesaid Act approved October first, eighteen hundred and ninety, or amendments thereto, any brandy or wine spirits used in the manufacture or fortification of said wine, otherwise than is provided for in said Act and its amendments, or who shall rectify, mix, or compound with other distilled spirits such fortified wines or grape brandy or wine spirits unlawfully recovered therefrom, shall, on conviction, be punished for each such offense by a fine of not less than two hundred dollars nor more than one thousand dollars. But the provisions of this section, and the provisions of section thirty-two hundred and forty-four of the Revised Statutes of the United States, as amended, relating to rectification, shall not be held to apply to the blending of pure sweet wines fortified under the provisions of the said Act of October first, eighteen hundred and ninety, or amendments thereto, where such wines are blended for the sole purpose of perfecting the same according to commercial standard." R. S. § 3244, as amended, mentioned in this section, which imposed a special tax on rectifiers of distilled spirits, is set forth ante, § 5971. Tax on alcoholic compounds § 6123. (Act Feb. 4, 1909, c. 65.) Tax on imported merchandise, see ante, § 3749. Tax on manufactured articles.-See section 3749, ante. Res judicata as to question of tax.A conclusion in a prior suit between different parties that Porto Rican bay rum imported into the United States was not subject to customs duties or internal revenue tax was not res judicata of such question in a subsequent action, though it would be regarded as persuasive authority. Roche v. Jordan (C. C. 1909) 175 Fed. 234. Statute as congressional declaration as to tax under prior statutes.-The imposition of a specific tax upon bay rum imported from Porto Rico made by this statute was not a congressional declaration that bay rum so imported was not subject to a tax under prior statutes. Jordan v. Roche (1913) 33 Sup. Ct. 573, 228 U. S. 436, 57 L. Ed. 908. The Circuit Court of Appeals having previously determined that under Foraker Act April 12, 1900, § 3, ante, § 3749, providing for the taxation of imports from Porto Rico, Porto Rican bay rum was not subject to customs duties because not distilled spirits nor the product of distillation, taxable under sections 5985, 5989, ante, such construction could not be affected by the subsequent passage of Act Feb. 4, 1909, c. 65, 35 Stat. 594. Roche v. Jordan (C. C. 1909) 175 Fed. 234. § 6124. (R. S. § 3329, as amended, Act May 28, 1880, c. 108, § 10.) Drawback on distilled spirits. Distilled spirits upon which all taxes have been paid may be exported, with the privilege of drawback, and in distillers' original casks, packages containing not less than twenty wine-gallons each, on application of the owner thereof to the collector of customs at any port of entry, and under such rules and regulations, and after making such entry as may be prescribed by law and by the Secretary of the Treasury. The entry for such exportation shall be in triplicate, and shall contain the name of the person applying to export, the name of the distiller, the name of the district in which the spirits were distilled, the name of the vessel by which, and the name of the port to which, they are to be exported; and the form of the entry shall be as follows: Export Entry of Distilled Spirits Entitled to Drawback. Entry of spirits distilled by of, to be exported by is master, bound to in district, State whereof And the entry shall specify the whole number of casks or packages, the marks and serial numbers thereon, the quality or kind of spirits as known in commerce, the number of gauge or wine gallons and of proof-gallons; and the amount of the tax on such spirits shall be verified by the oath of the owner of the spirits, and that the tax has been paid thereon, and that they are truly intended to be exported to the port of and not to be relanded within the limits of the United States. One bill of lading, duly signed by the master of the vessel, shall be deposited with said collector, to be filed at his office with the entry retained by him. One of said entries shall be, when the shipment is completed, transmitted to the Secretary of the Treasury, to be recorded and filed in his office. The lading on board said vessel shall be only after the receipt of an order or permit signed by the collector of customs and directed to a customs gauger, and after each cask or package shall have been distinctly marked or branded by said gauger as follows: "For export from U. S. A.," and the tax-paid stamps thereon obliterated. The casks or packages shall be inspected and gauged alongside of or on the vessel by the gauger designated by said collector, under such rules and regulations as the Secretary of the Treasury may prescribe; and on application of the said collector it shall be the duty of the surveyor of the port to designate and direct one of the custom-house inspectors to superintend such shipment. And the gauger aforesaid shall make a full return of such inspection and gauging in such form as may be prescribed by the Secretary of the Treasury, showing by whom each cask of such spirits was distilled, the serial number of the cask, and of the tax-paid stamp attached thereto, the proof and quantity of such spirits as per the original gauge-mark on each cask, and the quantity in proof and wine gallons as per the gauge then made by him. And said gauger shall certify on such return that the shipment has been made, in his presence, on board the vessel named in the entry for export, which return shall be indorsed by said custom-house inspector certifying that the casks or packages have been shipped under his supervision on board said vessel, and the tax-paid stamps obliterated; and the said inspector shall make a similar certificate to the surveyor of the port, indorsed on or to be attached to the entry in possession of the custom-house. A drawback shall be allowed upon distilled spirits on which the tax has been paid and exported to foreign countries, under the provisions of this act, when exported as herein provided for. The drawback allowed shall include the taxes levied and paid upon the distilled spirits exported, (at the rate of ninety cents per proof-gallon) as per last gauge of said spirits prior to exportation, and shall be due and payable only after the proper entries have been made and filed, and all other conditions complied with as hereinbefore required, and on filing with the Secretary of the Treasury the proper claim, accompanied by the certificate of the collector of customs at the port of entry where the spirits are entered for export, that such spirits have been received into his custody and the tax-paid stamps thereon obliterated; and the Secretary of the Treasury shall prescribe such rules and regulations in relation thereto as may be necessary to secure the Treasury of the United States against frauds: Provided, That the drawback on spirits distilled prior to August one, eighteen hundred and seventy-two, shall not exceed sixty cents per proof-gallon. Act July 20, 1868, c. 186, § 54, 15 Stat. 147. Act June 6, 1872, c. 315, § 12, 17 Stat. 241. Act May 28, 1880, c. 108, § 10, 21 Stat. 148. This section, as enacted in the Revised Statutes, was amended by striking out, after the words "the privilege of drawback," the words "in quantities of not less than one thousand gallons," and by inserting after the words "original casks" the word "packages," and by inserting after the words "upon the distilled spirits exported," in place of the words "at the rate of seventy cents per proof gallon," the word "ninety," but evidently intending to substitute the word "ninety" for the word "seventy," merely, as set forth here, by Act May 28, 1880, c. 108, § 10, cited above. The tax on distilled spirits was increased from 70 cents on each proof gallon to 90 cents on each proof gallon, or wine gallon when below proof, by Act March 3, 1875, c. 127, § 1, 18 Stat. 339, and was increased to $1.10 on each proof gallon, or wine gallon when below proof, by Act Aug. 27, 1894, c. 349, $ 48, ante, § 5986. Provisions allowing drawback upon exportation are contained in Title XXXIV, "Collection of Duties upon Imports," c. 9. A drawback was not allowed upon the exportation of bottled spirits, by Act March 3, 1897, c. 379, § 3, ante, § 6072. A drawback on the exportation of flavoring extracts, medicinal or toilet preparations, made in part from domestic tax-paid alcohol, was allowed by the Underwood Tariff Act of Oct. 3, 1913, c. 16, § IV, O, ante, § 5724, which re-enacted a similar provision made by the preceding tariff act. Notes of See notes under the following section. Bona fide exportation.-To constitute a bona fide exportation it is necessary that the owner of the whisky should intend that it should not only be landed in a foreign port, but that it should enter into the commerce of some foreign country. (1908) 27 Op. Atty. Gen. 113. Withdrawal and exportation to postpone payment of tax.-A withdrawal of whiskies from bonded warehouses under this and the following section, and transportation thereof to foreign ports with the intention of holding the same for a time and then having them returned as reimportations of manufactures of the United States, the purpose being to postpone payment of the taxes on the whiskies shipped, is not an exportation within the meaning of such sections. (1908) 27 Op. Atty. Gen. 113. Such withdrawal, not being a bona fide exportation, is unlawful, and a for Decisions feiture of the whiskies involved can be enforced if found within the jurisdiction of the United States. The parties withdrawing the same are also liable to punishment. Id. Allowance of drawback.-This section and section 6125, post, taken together, show that, when spirits on which the tax has been paid are exported, they are regauged at the port of exportation, and the drawback allowed is determined by the amount of this gauge, notwithstanding a previous gauge may have shown a greater amount. The result is that the owner receives no drawback on any deficiency occurring prior to the last regauge. Thompson v. U. S. (1892) 12 Sup. Ct. 299, 301, 142 U. S. 471, 35 L. Ed. 1084. Cited without definite application, Taney v. Penn Nat. Bank of Reading (1914) 34 Sup. Ct. 288, 289, 232 U. S. 174, 58 L. Ed. 558; Clay v. Swope (C. C. 1889) 38 Fed. 396, 399; Miles v. Johnson (C. C. 1893) 59 Fed. 38, 40. § 6125. (R. S. § 3330, as amended, Act May 28, 1880, c. 108, § 11.) Exportation of distilled spirits withdrawn from bonded warehouses. Distilled spirits may be withdrawn from distillery bonded warehouses, at the instance of the owner of the spirits, for exportation in the original casks, or packages, without the payment of tax, under such regulations, and after making such entries and executing and filing with the collector of the district from which the removal is to be made such bonds and bills of lading, and giving such other additional security as may be prescribed by the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury: Provided, That bonds given under this section shall be canceled under such regulations as the Secretary of the Treasury shall prescribe: And provided further, That the bonds required to be given for the exportation of distilled spirits shall be canceled upon the presentation of satisfactory proof and certificates that said distilled spirits have been landed at the port of destination named in the bill of lading, or upon satisfactory proof that after shipment the same were lost at sea without fault or neglect of the owner or shipper thereof. All distilled spirits intended for export, as aforesaid, before being removed from the distillery warehouse, shall be marked as the Commissioner of Internal Revenue may prescribe, and shall have affixed to each cask an engraved stamp indicative of such intention, to be provided and furnished by the several collectors as in the case of other stamps, and to be charged to them and accounted for in the same manner, and for the expense attending the providing and affixing such stamps [twenty-five] cents for each package so stamped shall be paid to the collector on making the entry for such transportation. When the owner of the spirits shall have made the proper entries, filed the bonds, and otherwise complied with all the requirements of the law and regulations as herein provided, the collector shall issue to him a permit for the removal and transportation of said. spirits to the collector of the port from which the same are to be exported, accurately describing the spirits to be shipped, the amount of tax thereon, the State and district from which the same is to be shipped, the name of the distiller by whom distilled, the port to which the same are to be transported, the name of the collector of the port to whom the spirits are to be consigned, and the routes over which they are to be sent to the port of shipment. Such shipment shall be made over bonded routes whenever practicable. The collector of the port shall receive such spirits, and permit the exportation thereof, under the same rules and regulations as are prescribed for the exportation of spirits upon which the tax has been paid. And every person who fraudulently claims, or seeks, or obtains an allowance of drawback on any distilled spirits, or fraudulently claims any greater allowance or drawback than the tax actually paid thereon, shall forfeit and pay to the Government of the United States triple the amount wrongfully and fraudulently sought to be obtained, and shall be imprisoned not more than ten years; and every owner, agent, or master of any vessel or other person who knowingly aids or abets in the fraudulent collection or fraudulent attempts to collect any drawback upon, or knowingly aids or permits any fraudulent change in the spirits so shipped, shall be fined not exceeding five thousand dollars and imprisoned not more than one year, and the ship or vessel on board of which such shipment was made or pretended to be made shall be forfeited to the United States, whether a conviction of the master or owner be had or otherwise, and proceedings may be had in admiralty by libel for such forfeiture. |