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rectifiers to fur

Officers of internal revenue may take possession of a distillery and operate it for a short time to ascertain whether it is being operated according to law. (United States v. One Distillery & Fixtures, 193 Fed. 720.)

Supervision of warehouse by officer on duty thereat.

1862.)

(T. D.

Distillers and R. S. 3277. On the demand of any internal-revenue officer, nish facilities for every distiller or rectifier shall furnish strong, safe, and conexamination; venient ladders of sufficient length to enable the officer to examine penalty for neg- and gauge any vessel or utensils in such distillery or premises; lect. and shall, at all times when required, supply all assistance, lights, ladders, tools, staging, or other things necessary for inspecting the premises, stocks, tools, and apparatus belonging to such person, and shall open all doors, and open for examination all boxes, packages, and all casks, barrels, and other vessels not under the control of the revenue officer in charge, under a penalty of five hundred dollars for every refusal or neglect so to do.

Section 3152 makes this section applicable to revenue agents. Officers may R. S. 3278. It shall be lawful for any revenue officer and any break up ground or walls in order person acting in his aid, to break up the ground on any part of a to examine. distillery, or premises of a distiller or rectifier, or any ground adjoining or near to such distillery or premises, or any wall or partition thereof, or belonging thereto, or other place, to search for any pipe, cock, private conveyance, or utensil; and, upon finding any such pipe or conveyance leading therefrom or thereto, to break up any ground, house, wall, or other place through or into which such pipe or other conveyance leads, and to break or cut away such pipe or other conveyance, and turn any cock, or to examine whether such pipe or other conveyance conveys or conceals any mash, wort, or beer, or other liquor, which may be used for the distillation of low-wines or spirits, from the sight or view of the officer, so as to prevent or hinder him from taking a true account thereof.

Removing any

under other than trade

names;

R. S. 3449. Whenever any person ships, transports, or removes liquors or wines any spirituous or fermented liquors or wines, under any other than the proper name or brand known to the trade as designating the kind and quality of the contents of the casks or packages containing the same, or causes such act to be done, he shall forfeit said liquors or wines, and casks or packages, and be subject to pay a fine of five hundred dollars.

penalty.

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280 Fed. 243, Graves Liquor Corp. v. Coll.

See sec. 240, Criminal Code, post, under "Shipping," for forfeiture of interstate shipments not properly marked.

The requirements of this statute can not be limited to distillers, manufacturers, and rectifiers, as its language covers all persons who ship, transport, or remove liquors or wines. (United States v. Camp et al., Northern District of California, 89 Fed. 697.) See 133 Fed. 910 (T. D. 844) for later decision of Circuit Court of Appeals.

Removing or R. S. 3450. Whenever any goods or commodities for or in reconcealing articles with intent spect whereof any tax is or shall be imposed, or any materials, to defraud United utensils, or vessels proper or intended to be made use of for or

States of tax.

in the making of such goods or commodities are removed, or are deposited or concealed in any place, with intent to defraud the United States of such tax, or any part thereof, all such goods and commodities, and all such materials, utensils, and vessels, respectively, shall be forfeited; and in every such case all the casks, vessels, cases, or other packages whatsoever, containing, or which shall have contained, such goods or commodities, respectively, and every vessel, boat, cart, carriage, or other conveyance whatsoever and all horses or other animals, and all things used in the removal or for the deposit or concealment thereof, respectively, shall be forfeited.

266 Fed. 138, U. S. v. One Essex Tour. Car. 268 Fed. 1003, U. S. v. One Haynes Auto. 270 Fed. 590, U. S. v. One Bay Horse. 273 Fed. 253, U. S. v. Sylvester; 934. U. S. v. One Cole Aero Eight. 274 Fed. 926, U. S. v. One Haynes Auto. 276 Fed. 28, U. S. v. One Essex Tour. Auto. 279, Fed. 55, The Tuscan; 112, Payne v.

U. S.; 422, Reo Atlantic v. Stern. 280, Fed. 5, Lewis v. U. S.;
761, Parilla v. U. S.; One Ford Tour. Car v. U. S. (C. C. A. Ark.),
Oct. 21, 1922, unreported; U. S. v. The Steam Vessel
"Javary"
(D. C. N. Y.), Aug. 3, 1922, unreported.

And every person who removes, deposits, or conceals, or is concerned in removing, depositing, or concealing any goods or commodities for or in respect whereof any tax is or shall be imposed, with intent to defraud the United States of such tax or any part thereof, shall be liable to a fine or penalty of not more than five hundred dollars. And all boilers, stills, or other vessels, tools and implements, used in distilling or rectifying, and forfeited under any of the provisions of this Title, and all condemned material, together with any engine or other machinery connected therewith, and all empty barrels, and all grain or other material suitable for distillation, shall, under the direction of the court in which the forfeiture is recovered, be sold at public auction, and the proceeds thereof, after deducting the expenses of sale, shall be disposed of according to law.

Penalty and forfeiture.

And all spirits or spirituous liquors which may be forfeited Spirits forfeitunder the provisions of this Title, unless herein otherwise pro- ed; how disposed vided, shall be disposed of by the Commissioner of Internal Reve

nue as the Secretary of the Treasury may direct.

Innocence of claimant no defense. (Goldsmith v. Grant, 254
U. S. 505.)

See also 254 Fed. 287; 257 Fed. 251, T. D. 2789; 260 Fed. 746;
266 Fed. 138; 267 Fed. 1021; 276 Fed. 55. Contra, 274 Fed. 926.

of.

session in fraud

R. S. 3453. All goods, wares, merchandise, articles, or objects, Seizure of propon which taxes are imposed, which shall be found in the pos- erty, found in possession, or custody, or within the control of any person, for the of revenue laws; purpose of being sold or removed by him in fraud of the internal- forfeitures. revenue laws, or with design to avoid payment of said taxes, may be seized by the collector or deputy collector of the proper district, or by such other collector or deputy collector as may be specially authorized by the Commissioner of Internal Revenue for that purpose, and shall be forfeited to the United States. And all raw materials found in the possession of any person intending to maunfacture the same into articles of a kind subject to tax for the purpose of fraudulently selling such manufactured articles, or with design to evade the payment of said tax; and all tools, implements, instruments, and personal property whatsoever, in the place or building, or within any yard or inclosure where such articles or raw materials are found, may also be seized by any collector or deputy collector, as aforesaid, and shall be forfeited as aforesaid. The proceedings to enforce such forfeitures shall be in the nature of a proceeding in rem in the circuit court or district court of the United States for the district where such seizure is made.

An acquittal in a criminal prosecution is a bar to a proceeding in rem when the offense is the same. (Coffee v. United States, 116 U. S. 436; 32 Int. Rev. Rec. 38.)

Forfeiture not a bar to prosecution for crime committed. (Wood v. United States, 204 Fed. 55; T. D. 1836.)

The acquittal of a defendant under indictment not a bar to an action on bond to recover the amount due the Government. (United States v. Jaedicke, 73 Fed. 100. See also United States Fidelity and Guaranty Co. v. United States, 150 Fed. 554.)

The United States is not estopped by verdict of acquittal from
proceeding in a civil action for the tax. (United States
Schneider, 35 Fed. 107.)

Acquittal bar to civil action for penalty.
Seattle Brewing & Malting Co., 135 Fed. 597.)

v.

(United States v.

Burden of proof.-There is a distinction between civil and criminal cases in respect to the degree or quantum of evidence necessary to justify the jury in finding their verdict. In civil cases their duty is to find for the party in whose favor it preponderates. Innocence is presumed in a criminal case until the contrary is proven; but the presumption of innocence as probative evidence is not applicable in civil cases nor in revenue seizures. (Lilienthal's Tobacco v. United States, 97 U. S. 237; 24 Int. Rev. Rec. 60.)

The court has no power to return goods seized by a revenue officer against which no proceedings for forfeiture have been instituted. (United States v. Hee, 219 Fed. 1019; T. D. 2191.)

Sale to evade tax; forfeiture.

Moiety.

ties.

An in rem suit is a civil proceeding. Preponderance of evidence only required. (Grain Distillery No. 8, etc., v. United States, 204 Fed. 429; T. D. 1837.)

277 Fed. 410, U. S. v. 2,000 Cases of Whisky. 282 Fed. 628, Smith v. Gilliam. 284 Fed. 284, Standard Carpet Co. v. Bowers. SEC. 3454. Whenever any person who is liable to pay any tax upon any goods, wares, or merchandise, sells or causes or allows the same to be sold before the tax is paid to which said property is liable, with intent to avoid such tax, or in fraud of the internal-revenue laws, any debt contracted in such sales, and any security given therefor, unless the same shall have been bona fide transferred to an innocent holder, shall be void, and the collection thereof shall not be enforced in any court. And if such goods, wares, or merchandise have been paid for, in whole or in part, the sum so paid shall be deemed forfeited, and any person who shall sue for the same in an action of debt shall recover from the seller the amount so paid, one half to his own use and the other half to the use of the United States.

Disposing of or SEC. 3455. Whenever any person sells, gives, purchases, or rereceiving empty ceives any box, barrel, bag, vessel, package, wrapper, cover, or stamped packages, etc., penal- envelope of any kind, stamped, branded, or marked in any way so as to show that the contents or intended contents thereof have been duly inspected, or that the tax hereon has been paid, or that any provision of the internal-revenue laws has been complied with, whether such stamping, branding, or marking may have been a duly authorized act or may be false and counterfeit, or otherwise without authority of law, said box, barrel, bag, vessel, package, wrapper, cover, or envelope being empty, or containing Manufacturing, anything else than the contents which were therein when said etc., such pack- articles had been so lawfully stamped, branded, or marked by

ages.

Verbal error corrected.

Penalty and forfeiture by dis

ufacturers of to

an officer of the revenue, he shall be liable to a penalty of not less than fifty nor more than five hundred dollars. And every person who makes, manufactures, or produces any box, barrel, bag, vessel, package, wrapper, cover, or envelope, stamped, branded, or marked, as above described, or stamps, brands, or marks the same, as herein before recited, shall be liable to penalty as before provided in this section. And every person who violates the foregoing provisions of this section with intent to defraud the revenue, or to defraud any person, shall be liable to a fine of not less than one thousand nor more than five thousand dollars, or to imprisonment for not less than six months nor more than five years, or to both, at the discretion of the court. And all articles sold, given, purchased, received, made, manufactured, produced, branded, stamped, or marked in violation of the provisions of this section, and all their contents, shall be forfeited to the United [States].

SEC. 3456. If any distiller, rectifier, wholesale liquor dealer, or tillers, rectifiers, manufacturer of tobacco or cigars shall knowingly or willfully wholesale liquor omit, neglect, or refuse to do or cause to be done any of the dealers, and man- things required by law in the carrying on or conducting of his bacco or cigars, business, or shall do anything by this title prohibited, if there be for omitting no specific penalty or punishment imposed by any other section things required, of this title for the neglecting, omitting or refusing to do, or for for doing the doing or causing to be done the thing required or prohibited, Act Feb. 27, he shall pay a penalty of one thousand dollars; and if the person 1877. (19 Stat. so offending be a distiller, rectifier, or wholesale liquor dealer, 240.) Verbal er- all distilled spirits or liquors owned by him or in which he has

and

things forbidden.

ror corrected.

any interest as owner, and if he be a manufacturer of tobacco or cigars, all tobacco or cigars found in his manufactory shall be forfeited to the United States.

Intent. (Felton v. United States, 96 U. S. 699; 24 Int. Rev. Rec. 252.)

Meaning of the words "knowingly and willfully." (A Quantity of Distilled Spirits, etc., 3 Ben. 552; Fed. Cas. No. 11495; 10 Int. Rev. Rec. 206; 11 Id. 3.)

The guilty intent to be determined by the facts and circumstances. A person intends the natural and probable consequences of acts intentionally done. (Agnew v. United States, 165 U. S. 57.)

ed in forfeiture

SEC. 3457. In every case where any goods or commodities are Package includforfeited under any internal-revenue law, all casks, vessels, cases, of goods. or other packages whatsoever, containing, or which shall have contained such goods or commodities, respectively, shall be forfeited.

to marshal before

Cost of seizure.

and

fixed by officer.

Bonding

seized, etc.

per

SEC. 3458. Any goods, wares, merchandise, articles, or objects Goods seized which may be seized under the provisions of section thirty-four may be delivered hundred and fifty-three by any collector or deputy collector, may, process issues. at the option of the collector, be delivered to the marshal of the district, and remain in the care and custody and under the control of said marshal until he shall obtain possession by process of law. And the cost of seizure made before process issues shall be taxable by the court. And where any whisky or tobacco, or Whisky, tobacother article of manufacture or produce, requiring brands, co, etc., sold on distraint, forfeistamps, or marks of whatever kind to be placed thereon shall be ture, etc., marks, sold upon distraint, forfeiture, or other process provided by law, brands,, the same not having been branded, stamped, or marked as re-stamps to be afquired by law, the officer selling the same shall, upon sale thereof, fix or cause to be affixed the brands, stamps, or marks so required and deduct the expense thereof from the proceeds of such sale. SEC. 3459. When any property which is seized under the foregoing provisions of section thirty-four hundred and fifty-three is ishable goods liable to perish or become greatly reduced in price or value by keeping, or when it can not be kept without great expense, the owner thereof, or the marshal of the district, may apply to the collector of the district to examine it; and if, in the opinion of the said collector, it shall be necessary that the said property should be sold to prevent such waste or expense, he shall appraise the same; and thereupon the owner shall have said property returned to him upon giving bond in such form as may be prescribed by the Commissioner of Internal Revenue, and in an amount equal to the appraised value, with such sureties as the collector shall deem good and sufficient, to abide the final order, decree, or judgment of the court having cognizance of the cause, and to pay the amount of said appraised value to the collector, marshal, or otherwise, as he may be ordered and directed by the court, which bond shall be filed by said collector with the United States district attorney for the district in which said proceedings in rem may be commenced: Provided, That in case said bond shall have been executed and the property returned before seizure thereof by virtue of the process aforesaid, the marshal shall give notice of pendency of proceedings in court to the parties executing said bond, by personal service or publication, and in such manner and form as the court may direct, and the court shall thereupon have jurisdiction of said matter and parties in the same manner as if such property had been seized by virtue of the process aforesaid. But if said owner shall neglect or refuse to give said bond, Sale for want the collector shall issue to a deputy collector or to the marshal of bond. aforesaid an order to sell the same; and the deputy collector or marshal shall thereupon advertise and sell the said property at public auction in the same manner as goods may be sold on final execution in said district; and the proceeds of the sale, after deducting the reasonable costs of the seizure and sale, shall be paid to the court afosesaid, to abide its final order, decree, or judgment.

R. S. 3460. In all cases of seizure of any goods, wares, or mer- Proceedings on chandise, as being subject to forfeiture under any provision of seizure of goods valued at $500 the internal-revenue laws, which, in the opinion of the collector or less. or deputy collector making the seizure, are of the appraised value of five hundred dollars or less, the said collector or deputy collector shall, except in cases otherwise provided, proceed as follows:

List and ap

First. He shall cause a list containing a particular description of the goods, wares, or merchandise seized to be prepared in praisement. duplicate, and an appraisement thereof to be made by three sworn appraisers to be selected by him, who shall be respectable and

ure.

Notice of seiz

Claim to be filed.

ant.

disinterested citizens of the United States residing within the collection district wherein the seizure was made. Said list and appraisement shall be properly attested by the said collector or deputy collector and the said appraisers, for which service each of the said appraisers shall be allowed the sum of one dollar and fifty cents a day, to be paid in the manner provided by law for other necessary charges of collectors.

Second. If the said goods are found by the said appraisers to be of the value of five hundred dollars or less, the said collector or deputy collector shall publish a notice for three weeks, in some newspaper of the district where the seizure was made, describing the articles, and stating the time, place, and cause of their seizure, and requiring any person claiming them to appear and make such claim within thirty days from the date of the first publication of such notice.

Third. Any person claiming the goods, wares, or merchandise so seized, within the time specified in the notice, may file with the said collector or deputy collector a claim, stating his interest Bond of claim- in the articles seized, and may execute a bond to the United States in the penal sum of two hundred and fifty dollars, with sureties to be approved by the said collector or deputy collector, conditioned that, in case of condemnation of the articles so seized, the obligators shall pay all the costs and expenses of the proceedings to obtain such condemnation; and upon the delivery of such bond to the collector or deputy collector, he shall transmit the same, with the duplicate list or description of the goods seized, to the United States district attorney for the district, and said attorney shall proceed thereon in the ordinary manner prescribed by law.

Sale of goods Fourth. If no claim is interposed and no bond is given within and disposal of the time above specified, the collector or deputy collector, as the proceeds. case may be, shall give ten days' notice of the sale of the goods, wares, or merchandise by publication, and, at the time and place specified in the notice, shall sell the articles so seized at public auction, and, after deducting the expense of appraisement and sale, he shall deposit the proceeds to the credit of the Secretary of the Treasury.

distribution.

Instructions as to the mode of procedure under this section. (Regulations, No. 2, revised, p. 45, and Regulations, No. 12, revised, 1920, p. 63 et seq.

Instructions as to disposition of property seized. (Cir. No. 580; T. D. 209.)

Instructions in regard to reports. (T. D. 623.)

The gross amount of proceeds of sale to be covered into the Treasury. (Act of May 27, 1908, 35 Stat. 325, p. 108; T. D. 1373; Cir. 725, June 5, 1908.)

Provision relative to spirits which will not sell for price equal to the tax. (Sec. 3334, R. S.)

282 Fed. 628, Smith v. Gilliam.

Application for R. S. 3461. Within one year after the sale of any goods, wares, remission and return of proceeds; or merchandise, as provided in the preceding section, any person claiming to be interested in the property sold may apply to the Secretary of the Treasury for a remission of the forfeiture thereof, or any part thereof, and a restoration of the proceeds of the sale; and the said Secretary may grant the same upon satisfactory proof, to be furnished in such manner as he shall prescribe: Provided, That it shall be satisfactorily shown that the applicant, at the time of the seizure and sale of the said property, and during the intervening time, was absent, out of the United States, or in such circumstances as prevented him from knowing of the seizure, and that he did not know of the same; and also that the said forfeiture was incurred without willful negligence or any intention of fraud on the part of the owner of said property. If no application for such restoration is made within one year, as hereinbefore prescribed, the Secretary of the Treasury shall, at the expiration of the said time, cause the proceeds of the sale of the said property to be distributed according to law,

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