Thompson Manufacturing Co. v. United States

delivered the opinion of the court:

This is an action to recover upon a claim for refund duly filed a tax of $2,470.57 paid on dividends.

On January 16, 1933, the plaintiff’s board of directors voted “to declare a dividend of 80% payable soon as convenient.” In order to obtain the cash to pay this dividend it was necessary for the plaintiff to withdraw a considerable amount of the money which it had on deposit in a savings bank and to sell some bonds. The payment of the dividend was not made until sometime in October 1933.

The tax upon, dividends imposed by section 213 of the National Industrial Recovery Act (48 Stat. 195, 207) does-not apply to—

(a) Dividends declared before midnight June 15, 1933.

It is urged on behalf of defendant that the dividend resolution was inconclusive and did not show that the dividend was actually declared. In support of this claim United States v. Murine Co., 90 Fed. (2d) 549, is cited but in that case the language used with reference to the dividend was not definite or final. In the opinion a number of cases are cited showing that a declaration to pay dividends “is not invalid on account of language used which merely extends or makes uncertain the time of payment.” The provision that the dividend was to be paid “soon as convenient” merely made the time of payment uncertain and did not invalidate the declaration of it which was expressly-made. It follows that the tax upon the dividends was-wrongfully collected.

Judgment will be rendered for plaintiff in the amount of $2,470.57 with interest as provided by law. It is so ordered.