Heebner v. United States (50 F.2d 904, 1931)

PATTERSON, District Judge.

The action is to recover excess-profits tax paid by the plaintiff on June 12, 1923. It was commenced on April 18, 1930. The defendant moves to dismiss the complaint on the ground that the action is barred by limitation. Under section 1113 (a) of the Revenue Act of 1926 (26 USCA § 156), no suit may he brought to recover any internal revenue tax more than five years after payment, unless the claim has been disallowed and suit is brought within two years after disallowance of the plaintiff’s claim for refund.

The plaintiff filed claim for refund on June 9, 1927. By letter dated February 26, 1928, the Commissioner of Internal Revenue notified him that the claim would be rejected, and that the rejection would officially appear on the next schedule to be approved by the Commissioner. The rejection was accordingly listed on the schedule approved March 9, 1928. The plaintiff on October 29, 1928, filed a brief requesting a reopening of the matter. The Commissioner declined to change his ruling, and so notified the plaintiff in a letter dated April 9, 1929. This letter, setting forth brie|y the view of the facts taken by the Commissioner, and stating that the tax had been correctly computed, concluded: “The conclusions expressed in Bureau letter dated February 12, 1928 are therefore affirmed.” The plaintiff then filed a second claim for refund covering the same tax, and on February 28, 1930, the Commissioner informed him by letter of the forthcoming rejection of this claim.

The significant date here is March 9, 1928, when the original claim for refund was formally disallowed. The two-year period then began to run, and no further notice to the plaintiff was necessary. United States v. Michel, 282 U. S. 656, 51 S. Ct. 284, 75 L. Ed. -, decided by the Supreme Court on February 24, 1931. The time to commence suit therefore expired on March 9, 1930, and an action brought on April 18, 1930 was too’ late.

The plaintiff does not urge that a new lease of life was won by the second claim for refund and its rejection. He does contend,' however, that the first claim for refund was reopened and was not finally rejected until April 9, 1929. Support for this contention may come by analogy from the rule that a motion for new trial or a petition for rehearing, if seasonably made, extends the time for application for appeal until the motion or pe