Appeal from the District Court of the United States for the Eastern District for Pennsylvania; George A. Welsh, Judge.
Before DOBIE and McLAUGHLIN, Circuit Judges, and KALODNER, District Judge.
McLAUGHLIN, Circuit Judge.
This is a bankruptcy matter involving a tax claim of the Commonwealth of Pennsylvania against the bankrupt corporation. An involuntary petition in bankruptcy was filed against A. & G. Knitting Mills, a Pennsylvania corporation, on August 14, 1942.That company was adjudicated a bankrupt on August 31, 1942. On September 16, 1942 a proof of claim for taxes on behalf of the Commonwealth of Pennsylvania was filed. The items represented were:
Corporate net income 28.00 $49.25
On September 24, 1942, a trustee was appointed and he filed objections to the proof of claim. After a hearing, the referee disallowed the claim. The District Court, on appeal, reversed the finding of the referee and allowed the claim.
The claim itself is based on two Pennsylvania statutes. The first of these applies to the capital stock and loan tax of that State. It is Section 1 of the Act of February 2, 1937, P.L. 3, 72 P.S. § 707. It requires a corporation to file with the Pennsylvania Department of Revenue returns of the value of its capital stock and of its taxable indebtedness for a given calendar year by March 15th of the following year. It reads: " * * * every corporation * * * shall make, annually, a capital stock report to the Department of Revenue, on or before the fifteenth day of March, for the calendar year next preceding.* * * "
If a corporation fails to make such returns within the time prescribed by law, the Department of Revenue, under the Act of April 9, 1929, P.L. 343, Article VIII, Section 804, 72 P.S. § 804, is required to estimate the valuation of the capital stock and the indebtedness of the particular corporation and settle the account for taxes, penalty and interest. The pertinent provisions of this statute are set out in footnote 1.*fn1
The second statute applies to corporate net income and is in substance the same except that the time for filing the required report is on or before April 15th of the following year for the calendar year next preceding. It is Section 1 of the Act of May 29, 1941, P.L. 62, 72 P.S. § 3420d. It reads: " * * * it shall be the duty of every corporation, liable to pay tax under this act, on or before the fifteenth day of April * * * one thousand nine hundred forty-three to transmit to the department * * * a report * * * of net income taxable under the provisions of this act."
The same Act, 72 P.S. § 3420h, Paragraph (d), provides for estimation of the tax, etc., in event of neglect or refusal to file the required net income ...