7 U.S.C. § 623

Actions relating to tax; legalization of prior taxes

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(a) Action to restrain collection of tax or obtain declaratory judgment forbidden

No suit, action, or proceeding (including probate, administration, and receivership proceedings) shall be brought or maintained in any court if such suit, action, or proceeding is for the purpose or has the effect (1) of preventing or restraining the assessment or collection of any tax imposed or the amount of any penalty or interest accrued under this chapter on or after August 24, 1935, or (2) of obtaining a declaratory judgment under sections 2201 and 2202 of title 28 in connection with any such tax or such amount of any such interest or penalty. In probate, administration, receivership, or other similar proceedings, the claim of the United States for any such tax or such amount of any such interest or penalty, in the amount assessed by the Commissioner of Internal Revenue, shall be allowed and ordered to be paid, but the right to claim the refund or credit thereof and to maintain such claim pursuant to the applicable provisions of law, including subsection (d) of this section, may be reserved in the court’s order.

(b) Taxes imposed prior to August 24, 1935, legalized and ratified

The taxes imposed under this chapter, as determined, prescribed, proclaimed and made effective by the proclamations and certificates of the Secretary of Agriculture or of the President and by the regulations of the Secretary with the approval of the President prior to August 24, 1935, are legalized and ratified, and the assessment, levy, collection, and accrual of all such taxes (together with penalties and interest with respect thereto) prior to said date are legalized and ratified and confirmed as fully to all intents and purposes as if each such tax had been made effective and the rate thereof fixed specifically by prior Act of Congress. All such taxes which had accrued and remained unpaid August 24, 1935, shall be assessed and collected pursuant to section 619 of this title, and to the provisions of law made applicable thereby. Nothing in this section shall be construed to import illegality to any act, determination, proclamation, certificate, or regulation of the Secretary of Agriculture or of the President done or made prior to August 24, 1935.

The making of rental and benefit payments under this chapter, prior to August 24, 1935, as determined, prescribed, proclaimed and made effective by the proclamations of the Secretary of Agriculture or of the President or by regulations of the Secretary, and the initiation, if formally approved by the Secretary of Agriculture prior to such date of adjustment programs under section 608(1) of this title, and the making of agreements with producers prior to such date, and the adoption of other voluntary methods prior to such date, by the Secretary of Agriculture under this chapter, and rental and benefit payments made pursuant thereto, are legalized and ratified, and the making of all such agreements and payments, the initiation of such programs, and the adoption of all such methods prior to such date are legalized, ratified, and confirmed as fully to all intents and purposes as if each such agreement, program, method, and payment had been specifically authorized and made effective and the rate and amount thereof fixed specifically by prior Act of Congress.

(May 12, 1933, ch. 25, title I, § 21, as added Aug. 24, 1935, ch. 641, § 30, 49 Stat. 770; amended June 22, 1936, ch. 690, §§ 601(c), 901, 49 Stat. 1740, 1747; Pub. L. 95–598, title III, § 304, Nov. 6, 1978, 92 Stat. 2673.)Editorial NotesReferences in Text

Subsection (d) of this section, referred to in subsec. (a), was repealed by section 901 of act June 22, 1936. See 1936 Amendment note set out below.

Codification

“Sections 2201 and 2202 of title 28” was substituted for “the Federal Declaratory Judgments Act”, which had enacted section 400 of former Title 28, Judicial Code and Judiciary, on authority of act June 25, 1948, ch. 646, 62 Stat. 869, section 1 of which enacted Title 28, Judiciary and Judicial Procedure.

Another section 21 of act May 12, 1933, enacted sections 992 and 993 of Title 12, Banks and Banking.

Constitutionality

Unconstitutionality of processing and floor stock taxes, see note set out under section 616 of this title.

Amendments

1978—Subsec. (a). Pub. L. 95–598 struck out “, and bankruptcy” after “receivership” in first sentence, and struck out “bankruptcy,” after “receivership” in second sentence.

1936—Subsecs. (d) to (g). Act June 22, 1936, § 901, repealed subsec. (d) relating to prohibition on making certain refunds, subsec. (e) providing for access to books, and subsec. (g) providing for recovery of taxes erroneously collected, and act June 22, 1936, § 601(c), repealed subsec. (f) relating to time for filing claim for refund.

Statutory Notes and Related SubsidiariesEffective Date of 1978 Amendment

Amendment effective Oct. 1, 1979, see section 402(a) of Pub. L. 95–598, set out as an Effective Date note preceding section 101 of Title 11, Bankruptcy.

Separability

Validity of remainder of this chapter as not affected should any of the provisions of this chapter be declared unconstitutional, see section 614 of this title.

Executive DocumentsTransfer of Functions

Functions of all officers of Department of the Treasury, and functions of all agencies and employees of such Department, transferred, with certain exceptions, to Secretary of the Treasury, with power vested in him to authorize their performance or performance of any of his functions, by any of such officers, agencies, and employees, by 1950 Reorg. Plan No. 26, §§ 1, 2, eff. July 31, 1950, 15 F.R. 4935, 64 Stat. 1280, set out in the Appendix to Title 5, Government Organization and Employees. Commissioner of Internal Revenue, referred to in this section, is an officer of Department of the Treasury.

Notes of Decisions

Cited in 55 cases, 1935–1971 · leading case: Perez v. Ledesma, 401 U.S. 82 (1971).

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Perez v. Ledesma, 401 U.S. 82 (1971). · cites it 2× “31 ( 7 U. S. C. § 623 (a)). In contrast, there is no statutory counterpart of 28 U.”

Rieder v. Rogan, 12 F. Supp. 307 (S.D. Cal. 1935). · cites it 4× “By various amendments added to sections 15 and 16 of the act (7 USCA §§ 615, 616), provision is made for the presentation, through the Commissioner of Internal Revenue, of claims for refunds, credits, or abatements of the amount of any tax paid under the act.”

John A. Gebelein, Inc. v. Milbourne, 12 F. Supp. 105 (D. Maryland 1935). · cites it 5× “By the amendment to the Act, section 21 (b), 7 USCA § 623 (b), processing taxes as heretofore determined by the Secretary of Agriculture are' expressly ratified and legalized.”

Comm'r of Internal Rev. v. Sec. Flour Mills Co., 135 F.2d 165 (10th Cir. 1943). · cites it 2× “, imposes a tax on unjust enrichment arising out of the nonpayment of processing taxes, the burden of which has been shifted to others; and Title VII, 7 U.S.C.A. §§ 623 , 644 et seq., authorizes refunds for amounts paid as processing taxes.”

Larabee Flour Mills Co. v. Nee, 12 F. Supp. 395 (W.D. Mo. 1935). · cites it 2× “ultural Adjustment Act affect in some manner the remedy at law provided to one who has paid a processing tax under the Agricultural Adjustment Act, the only limitation upon the general right conferred by section 3220 with which we are- here concerned is that embodied in section…”

Aiken Mills, Inc. v. United States, 144 F.2d 23 (4th Cir. 1944). ““A special procedure was provided with respect to processing taxes.”

Honorbilt Prods., Inc. v. Comm'r, 119 F.2d 797 (3rd Cir. 1941). “1648 , 7 U.S.C.A. § 623 note, repealed those portions of the Agricultural Adjustment Act relating to the processing taxes, following the decision of the Supreme Court in United States v.”

C. A. Durr Packing Co. v. Shaughnessy, 81 F. Supp. 33 (N.D.N.Y. 1948). “, which became effective on June 22, 1936, after conferences and negotiations, and on October 29, 1940, a check in the amount of $27,900, plus interest of about $10,000, was issued by the Treasury Department to the plaintiff in settlement of its claim for processing and floor…”

Tennessee Consol. Coal Co. v. Comm'r, 117 F.2d 452 (6th Cir. 1941). “The Commissioner disallowed the claim upon the ground, that it contained no allegation or evidence that petitioner had borne the burden of the tax and had not shifted it to others; and that it afforded no basis for a determination of the incidence of the tax and failed to…”

Bethlehem Baking Co. v. United States, 129 F.2d 490 (3rd Cir. 1942). “Thereafter Congress enacted Title VII, §§ 901-907 of the Revenue Act of 1936, 7 U.S.C.A. §§ 623 note, 644-649, providing for the refund of taxes which had been levied and collected under the Agricultural Adjustment Act.”

Fuhrman & Forster Co. v. Comm'r, 114 F.2d 863 (7th Cir. 1940). “1747 , 7 U.S.C.A. § 623 note, 644 et seq. The main question here involved is whether the petitioner was the processor who was obligated to pay the processing tax under the statute.”

Epstein v. Helvering, 120 F.2d 427 (4th Cir. 1941). “1747 , 7 U.S.C.A. §§ 623 note, 644 to 659, in a proceeding brought before it to review the rejection by the Commissioner of Epstein’s claim for refund of processing taxes paid under the Agricultural Adjustment Act of May 12, 1933, 48 Stat.”

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