1. A contract of tax exemption is not impaired by a later
statute authorizing assessments of back taxes on taxable property
and not specifying the property in question. P.
292 U. S.
18.
2. A mere assessment for taxation is not a statute or an order
of an administrative board or commission within the meaning of
§ 266, Judicial Code. P.
292 U. S.
18.
3. A decree rendered by a District Court erroneously constituted
of three judges in a case not covered by § 266, Jud.Code, is
not reviewable on the merits by direct appeal to this Court; but
such appeal having been taken, this Court has jurisdiction to
enforce the limitations of that section, and, the time for appeal
to the Circuit Court of Appeals having expired, this Court will
reverse the decree and remand to the District Court for further
proceedings to be taken independently of § 266. P.
292 U. S. 19.
4 F. Supp. 697 reversed.
Appeal by the State Tax Collector and State Tax Commission of
Mississippi from a final decree of the District Court, constituted
of three judges. The decree made permanent a preliminary injunction
enjoining the appellants from making assessments of taxes.
Page 292 U. S. 17
PER CURIAM.
Appellee brought this suit in the District Court of the United
States for the Southern District of Mississippi seeking to enjoin
state officers from proceeding to assess its property for the years
1927 to 1931, inclusive, upon the ground that the proposed
assessments would impair the obligation of a contract by which the
company had secured an exemption from taxation. Chapter 138, Laws
of Mississippi of 1922, and chapter 172, Laws of 1926. The
challenged proceedings were taken pursuant to a statute which
authorized assessments in cases where it was ascertained that, in
past years, property had escaped taxation.
See chapter
214, Laws of 1928; chapter 291, Laws of 1932; Mississippi Code of
1930, §§ 3226 and 6992; Code Supp. 1933, §§
3204, 3208. It appeared that, on April 14, 1933, at the instance of
the state tax collector, the state tax commission had made
assessments of appellee's property for prior years, subject,
however, to objections to be made and filed with the commission on
or before May 23, 1933. Appellee, instead of availing itself of
that opportunity, filed its bill in this suit on May 16, 1933.
The District Judge, on an application for an interlocutory
injunction, considering § 266 of the Judicial Code to be
applicable, called to his assistance two other judges, and the
District Court, as thus composed, granted an injunction restraining
defendants from approving and enforcing the proposed assessments.
Motions to dismiss
Page 292 U. S. 18
the bill for want of equity were denied. An agreed statement of
facts was filed, and, on final hearing, the District Court of three
judges made the injunction permanent. The court stated in its
findings that it had been agreed that the assessment order would
certainly be made final.
No substantial question was presented as to the validity of the
statute authorizing assessments of property which had escaped
taxation. The statute did not specify the property of appellee, and
authorized assessments only of property that was taxable.
A mere assessment is not a statute or an order of an
administrative board or commission within the meaning of § 266
of the Judicial Code.
Ex parte Williams, 277 U.
S. 267,
277 U. S. 272.
The decision in
City Bank Farmers' Trust Co. v. Schnader,
291 U. S. 24, is
not to the contrary. Hence, there was no occasion for constituting
a court of three judges. As the case was not one within § 266,
the merits cannot be brought to this Court by a direct appeal.
Compare Smith v. Wilson, 273 U. S. 388,
273 U. S. 389,
273 U. S. 391;
Healy v. Ratta, 289 U.S. 701. But, although the merits
cannot be reviewed here in such a case, this Court, by virtue of
its appellate jurisdiction in cases of decrees purporting to be
entered pursuant to § 266, necessarily has jurisdiction to
determine whether the court below has acted within the authority
conferred by that section and to make such corrective order as may
be appropriate to the enforcement of the limitations which that
section imposes. The case is analogous to those in which this
Court, finding that the court below has acted without jurisdiction,
exercises its appellate jurisdiction to correct the improper
action.
Assessors v.
Osborne, 9 Wall. 567,
76 U. S. 575;
Mansfield, C. & L.M. Railway Co. v. Swan, 111 U.
S. 379,
111 U. S.
378-389;
Union & Planters' Bank v. Memphis,
189 U. S. 71,
189 U. S. 73-74;
Shawnee Sewerage & Drainage Co. v. Stearns,
220 U. S. 462,
220 U. S.
471-472;
Piedmont & Northern R. Co. v. United
States, 280 U. S. 469,
280 U. S.
477-478;
Stratton v. St. Louis S.W. R. Co.,
282 U. S. 10,
282 U. S.
18.
Page 292 U. S. 19
In this instance, relief cannot be afforded by treating the
decree of the District Court as appealable to the Circuit Court of
Appeals, notwithstanding the participation of three judges (
cf.
Healy v. Ratta, 67 F.2d 554, 556), as the time for appeal to
that court has expired. In these circumstances, without passing
upon the merits, the appropriate action is to reverse the decree
below and to remand the cause to the District Court for further
proceedings to be taken independently of § 266 of the Judicial
Code.
It is so ordered.