would be a violation of the so-called "secrecy provisions" of the law. The Board held that the Commissioner's determination could be reviewed and that the Board had power to compel "the production of all evidence pertinent and material to a cause at issue before it." The Supreme Court of the District of Columbia in Oesterlein Machine Co. v. Blair and U. S. Board of Tax Appeals, ordered the Commissioner to obey the Board's subpoena calling for data from tax returns of representative corporations. The Commissioner has appealed from this decision.

The presentation of special assessment cases is somewhat difficult. All the requirements of the relief sections of the law must be fully complied with. Applications for subpoena must be filed within a reasonable length of time before the date of the hearing. Pending decision on the Oesterlein Machine case, the Board is placing special assessment cases on the Reserve Calendar where a motion is made to this effect by the taxpayer. As a foundation for such motion, however, there must be on file with the Board the application for a subpoena and the Commissioner's refusal to comply.

In a few cases the Board has indicated that a taxpayer must prove that representative corporations paid a lower rate of tax than the appellant. If a taxpayer makes out a prima facie case under the relief section, and the Board has upon application issued a subpoena compelling the Commissioner to submit data from returns of representative corporations, which he has ignored, the author is of the opinion that the Board should find in favor of the taxpayer's claim. If the Commissioner refuses to submit data from representative concerns, the Board should not permit him to argue that the taxpayer has failed to prove that representative concerns paid a lower rate of tax. By failing to obey a subpoena, the Commissioner might defeat all special assessment cases. The best evidence of taxes paid by representative concerns are the returns filed with the Commissioner. A taxpayer might subpoena officials of representative corporations, but their testimony would not be the best evidence, as, in many instances, they might not know what adjustments the Commissioner has made. Furthermore, the author is of the opinion that Congress intended that taxes under these special sections should be computed by a comparison with returns filed with the Commissioner and not by a comparison with records retained by taxpayers.

Jurisdiction over fraud and other penalties.-The Board held under the 1924 law, that an appeal lay from an assessment of fraud or other penalties. [Gutterman Strauss Co.'s Appeal, 1 B. T. A. 243 (A).] The 1926 law specifically confers this jurisdiction on the Board. However, the penalty must be asserted before or at the hearing.

The Board had held under the 1924 law that it could assert a penalty in addition to the deficiency where one seemed justified. (Peterson & Pegau Baking Co.'s Appeal, 2 B. T. A. 637.) In another case the fraud penalty was asserted at the hearing upon motion by the Commissioner. (Ascher's Appeal, 2 B. T. A. 1257.)

In considering these cases the Board has indicated that it will not act on mere suspicion and has recognized as the courts have recognized that it is not fraudulent so to arrange one's affairs as to escape taxation provided legal means are adopted. The Board discusses at length the question of tax evasion and the cases thereon in the Bradley Appeal [(1 B. T. A. 111 (A)].

Section 278 (a) (dealing with the statute of limitations) provides that in fraud cases the tax may be assessed or a proceeding in court for the collection of such tax may be begun at any time. Read in the light of the other provisions of the law, it is not believed that this authorizes the Commissioner to defeat the Board's jurisdiction in fraud cases by refusing to send a statutory notice. It would probably be held that the deficiency must first be redetermined by the Board.

No jurisdiction in bankruptcies or receiverships.-Under the 1924 law a bankrupt taxpayer or a taxpayer in the hands of a receiver could appeal to the Board to have any deficiency asserted by the Commissioner redetermined. This resulted in conflicts between the jurisdiction of the Board and the referee in bankruptcy or the receiver. For this reason Congress in the 1926 law [section 282 (a)] 38 has provided that in such cases the Board shall not have jurisdiction but that the exceptions of the taxpayer must be raised before the referee or receiver.

No jurisdiction of claims for refund or credit.-The Board very early fixed its jurisdiction in a case involving a refund claim.

38 See page 42.

In this case it held that it has no jurisdiction over an appeal involving only the refund of a tax paid prior to the passage of the Revenue Act of 1924. The decision was heard by the full membership of the Board and was unanimous. It reads, in part, as follows:

DECISION. . . . In view of the purpose of Congress in creating the Board as expressed when the bill was being considered, we think it was not intended that we should determine refund claims. The Board was created to give the taxpayer a chance to have an open and neutral consideration of his liability for a deficiency before he is required to pay. The harsh rule of payment first and litigation afterwards was sought to be mitigated. But the consideration of refund claims has no place in this scheme. Payment has already been made and there is nothing upon which the determination of the Board can effectively operate. The taxpayer has now, as he has heretofore had, a right of action in court to recover any amount erroneously collected.

The Board has also held that it has no jurisdiction over claims for credit. The reasoning is similar to that contained in the decision cited above. (Baron's Appeal, 1 B. T. A. 15.) (See also page 248.)

Claims for abatement.-The Board has also held that it has no jurisdiction over claims for abatement unless there is a deficiency.39

No jurisdiction to decide moot questions.-The Board has held it has no jurisdiction to decide moot questions and that it will dismiss on appeal where the question has become moot since the filing of the petition.40

Estate and gift taxes.-As has been stated above,41 the Board has jurisdiction of estate and gift tax deficiencies. The gift tax was abolished by the 1926 law but deficiencies are being determined under the 1924 law. What has been said relative to deficiencies and jurisdiction with respect to income and profits tax deficiencies applies equally to these taxes unless an exception has been specifically noted. The pertinent sections of the law follow.

LAW. Section 308. (a) If the Commissioner determines that there is a deficiency in respect of the tax imposed by this title, the Com

89

Baron's Appeal, 1 B. T. A. 15.

40 Northwestern Mutual Life Ins. Co.'s Appeal, 1 B. T. A. 767; also Gencral Equipment Co.'s Appeal, 2 B. T. A. 804; Stieff's Appeal, 2 B. T. A. 1109; Walcott Lathe Co.'s Appeal, 2 B. T. A. 1231 (A); Rindge Land & Navigation Co.'s Appeal, 2 B. T. A. 1179 (A); Thomas Shoe Co.'s Appeal, 1 B. T. A. 124 (A).

41 See page 218.

missioner is authorized to send notice of such deficiency to the executor by registered mail. Within 60 days after such notice is mailed (not counting Sunday as the sixtieth day), the executor may file a petition with the Board of Tax Appeals for a redetermination of the deficiency. Except as otherwise provided in subdivision (d) or (f) of this section or in section 312 or 1001, no assessment of a deficiency in respect of the tax imposed by this title and no distraint or proceeding in court for its collection shall be made, begun, or prosecuted until such notice has been mailed to the executor, nor until the expiration of such 60-day period, nor, if a petition has been filed with the Board, until the decision of the Board has become final. Notwithstanding the provisions of section 3224 of the Revised Statutes the making of such assessment or the beginning of such proceeding or distraint during the time such prohibition is in force may be enjoined by a proceeding in the proper court.

(b) If the executor files a petition with the Board, the entire amount redetermined as the deficiency by the decision of the Board which has become final shall be assessed and shall be paid upon notice and demand from the collector. No part of the amount determined as a deficiency by the Commissioner but disallowed as such by the decision of the Board which has become final shall be assessed or be collected by distraint or by proceeding in court with or without assessment.

(c) If the executor does not file a petition with the Board within the time prescribed in subdivision (a) of this section, the deficiency, notice of which has been mailed to the executor, shall be assessed, and shall be paid upon notice and demand from the collector.

(d) The executor shall at any time have the right, by a signed notice in writing filed with the Commissioner, to waive the restrictions provided in subdivision (a) of this section on the assessment and collection of the whole or any part of the deficiency.

(e) The Board shall have jurisdiction to redetermine the correct amount of the deficiency even if the amount so redetermined is greater than the amount of the deficiency, notice of which has been mailed to the executor, and to determine whether any additional amount or addition to the tax should be assessed, if claim therefor is asserted by the Commissioner at or before the hearing or a rehearing.

(f) If after the enactment of this Act the Commissioner has mailed to the executor notice of a deficiency as provided in subdivision (a), and the executor files a petition with the Board within the time prescribed in such subdivision, the Commissioner shall have no right to determine any additional deficiency, except in the case of fraud, and except as provided in subdivision (e) of this section or in subdivision (c) of section 312. If the executor is notified that, on account of a mathematical error appearing upon the face of the return, an amount of tax in excess of that shown upon the return is due, and that an assessment of the tax has been or will be made on the basis of what would have been the correct amount of tax but for the mathematical error, such notice shall not be considered, for the purposes of this subdivision or of subdivision (a) of this section, or of section 319, as a notice of a deficiency, and the executor shall have no right to file a petition with the Board of Tax Appeals based on such notice, nor shall such assessment or collection be prohibited by the provisions of subdivision (a) of this section.

(g) For the purposes of this title the date on which a decision of the Board becomes final shall be determined according to the provisions of section 1005.

LAW. Section 312. (a) If the Commissioner believes that the assessment or collection of a deficiency will be jeopardized by delay, he shall immediately assess such deficiency (together with all interest, additional amounts, or additions to the tax provided for by law) and notice and demand shall be made by the collector for the payment thereof.

(b) If the jeopardy assessment is made before any notice in respect of the tax to which the jeopardy assessment relates has been mailed under subdivision (a) of section 308, then the Commissioner shall mail a notice under such subdivision within 60 days after the making of the assessment.

(c) The jeopardy assessment may be made in respect of a deficiency greater or less than that notice of which has been mailed to the executor, despite the provisions of subdivision (f) of section 308 and whether or not the executor has theretofore filed a petition with the Board of Tax Appeals. The Commissioner shall notify the Board of the amount of such assessment, if the petition is filed with the Board before the making of the assessment or is subsequently filed, and the Board shall have jurisdiction to redetermine the entire amount of the deficiency and of all amounts assessed at the same time in connection therewith.

(d) If the jeopardy assessment is made after the decision of the Board is rendered such assessment may be made only in respect of the deficiency determined by the Board in its decision.

(e) A jeopardy assessment may not be made after the decision of the Board has become final or after the executor has filed a petition for review of the decision of the Board.

(f) When a jeopardy assessment has been made the executor, within 30 days after notice and demand from the collector for the payment of the amount of the assessment, may obtain a stay of collection of the whole or any part of the amount of the assessment by filing with the collector a bond in such amount, not exceeding double the amount as to which the stay is desired, and with such sureties, as the collector deems necessary, conditioned upon the payment of so much of the amount, the collection of which is stayed by the bond, as is not abated by a decision of the Board which has become final, together with interest thereon as provided in subdivision (j) of this section.

(g) If the bond is given before the executor has filed his petition with the Board under subdivision (a) of section 308, the bond shall contain a further condition that if a petition is not filed within the period provided in such subdivision, then the amount the collection of which is stayed by the bond will be paid on notice and demand at any time after the expiration of such period, together with interest thereon at the rate of 6 per centum per annum from the date of the jeopardy notice and demand to the date of notice and demand under this subdivision.

(h) Upon the filing of the bond the collection of so much of the amount assessed as is covered by the bond shall be stayed. The executor shall have the right to waive such stay at any time in respect