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fully executed and complied with, and shall aid in the prevention, detection, and punishment of any frauds in relation thereto. And it shall be the duty of every collector and of every internal revenue agent to report to the commissioner in writing any neglect of duty, incompetency, delinquency, or malfeasance in office of any internal revenue officer or agent of which he may obtain knowledge, with a statement of all the facts in each case, and any evidence sustaining the same.

The commissioner may also transfer any inspector, Commissioner gauger, storekeeper, or storekeeper and gaucertain officers. ger, from one distillery or other place of duty, or from one collection district, to another.

Extract from the act of August 15, 1876, Sec. 1 (19 Stat. 152). *** “ The powers of transfer, and of suspension, of officers conferred upon supervisors by section thirty-one hundred and sixty-three of the Revised Statutes, are hereby vested in the Commissioner of Internal Revenue; and all other powers conferred, and duties imposed, by said section upon supervisors, are hereby conferred and imposed upon collectors of internal revenue within their respective districts. In case of the supervision (suspension] of a collector, under the power hereby conferred, the Commissioner of Internal Revenue shall, as soon thereafter as practicable, report the case to the President through the Secretary of the Treasury for such action as he may deem proper.” * * *

The powers and duties specified in Sec. 3163, Revised Statutes, as that section was at the time of the above enactment of August 15, 1876, are as follows:

“Sec. 3163. Every supervisor, under the direction of the commissioner, shall see that all laws and regulations relating to the collection of internal taxes are faithfully executed and complied with ; and shall aid in the prevention, detection, and punishment of any frauds in relation thereto, and examine into the efficiency and conduct of all officers of internal revenue; and for such purposes he shall have power to examine all persons, books, papers, accounts, and premises, to administer oaths, and to summon any person to produce books and papers, or to appear and testify under oath before him, and to compel a compliance with such summons in the same manner as collectors may do. He shall report in writing to the Commissioner of Internal Revenue any neglect of duty, incompetency, delinquency, or malfeasance in office of any internal revenue officer of which he may obtain knowledge, with a statement of all the facts in each case, and any evidence sustaining the same. He may, by notice in writing, suspend from duty any inspector, gauger, or storekeeper, and he may suspend any collector for fraud, or gross neglect of duty, or abuse of power. In case of the suspension of any inspector, gauger, or storekeeper, he shall immediately notify the collector of the proper district and the Commissioner of Internal Revenue, and within three days thereafter report his action and his reasons therefor, in writing, to the commissioner. In case of the suspension of any collector, he shall immediately report his action to the commissioner, with his reasons therefor, in writing, and the commissioner, in all cases of suspension, shall thereupon take such action as he may deem proper. Every supervisor may also transfer any inspector, gauger, or storekeeper from one distillery, or other place of duty, or from one collection district, to another.”

It is held by the Internal Revenue Office that Sec. 3163, as it existed at the time of the amendment of it by act August 15, 1876, was not wholly repealed by the act of March 1, 1879, which enacted a substitute for said section, and that the act of August 15, 1876, so far as it conferred upon collectors the powers theretofore exercised by supervisors in regard to summons and examination of persons, books, etc., and upon the commissioner the power to suspend a collector, is still existing law. In my opinion there is grave doubt whether the act of March 1, 1879, reënacting Sec. 3163 in an amended form, did not repeal by implication all those parts of old Sec. 3163 that were not reënacted, notwithstanding the act of August 15, 1876. This point has never been judicially determined.

Under Sec. 3173 R. S. the collector has power to summon persons with books of accounts, and examine them for purposes of taxation; but the powers in this regard conferred by old Sec. 3163 are of a much ampler nature. On the subject of the examination of private books, etc., in revenue cases, see particularly Boyd v. United States, 116 U. S. 617.

Right of United States to examine distiller's private books, United States v. Mason, 6 Bissell, 351 (since overruled by the Supreme Court).

“ In the exercise of powers conferred upon collectors in the examination of private books, papers, and accounts, they should use great caution and discretion. Such powers are to be strictly construed, and should not be put in operation upon hasty or trivial charges. Exact observance of every form of law is necessary, that the collector may not be subjected to a suit for damages." Int. Rev. Reg., Series 7, No. 12, Revised,

p. 29.

Duty of collectors to report

to district attorney.

Power of supervisors to examine books and papers under Sec. 3163, Meador's case, 1 Abbott, 317; Stanwood v. Green, 2 Abbott, 94. Sec. 3164. It shall be the duty of every collector of

internal revenue to report within ten days to violations of law the district attorney of the district in which

any fine, penalty, or forfeiture may be incurred for the violation of any law of the United States relating to the revenue, a statement of all the facts and circumstances of the case within his knowledge, together with the names of the witnesses, and which may come to his knowledge from time to time, stating the provisions of the law believed to be violated, and on which a reliance may be had for condemnation or conviction ; and if any collector shall in any case fail to report to the proper district attorney as prescribed in this section, his right to any compensation, benefit, or allowance in such case shall be forfeited to the United States, and the same may, in the discretion of the Secretary of the Treasury, be awarded to such persons as may make complaint and prosecute the same to judgment or conviction.

In connection with this section, Sec. 838 R. S. is printed, showing the duties of United States district attorneys in dealing with cases reported to them by collectors of internal revenue.

Sec. 838. It shall be the duty of every district attorney to whom any collector of customs, or of internal revenue, shall report, according to law, any case in which any fine, penalty, or forfeiture has been incurred in the district of such attorney for the violation of any law of the United States relating to the revenue, to cause the proper proceedings to be commenced and prosecuted without delay, for the fines, penalties, and forfeitures in such case provided, unless, upon inquiry and examination, he shall decide that such proceedings cannot probably be sustained, or that the ends of public justice do not require that such proceedings should be instituted ; in which case he shall report the facts in customs cases to the Secretary of the Treasury, and in internal revenue cases to the Commissioner of Internal Revenue, for their direction.

And for the expenses incurred and services rendered in all such cases, the district attorney shall receive and be paid from the treasury such sum as the Secretary of the Treasury shall deem just and reasonable, upon the certificate of the judge before whom such cases are tried or disposed of : Provided, That the annual compensation of such district attorney shall not exceed the maximum amount prescribed by law, by reason of such allowance and

payment.

Under the provisions of Sec. 3460 R. S., when any property (except real estate) seized by the collector for violation of

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internal revenue laws does not exceed $500 in value, it should be proceeded against by the collector, instead of being reported to the district attorney, unless a bond for costs is given as provided in said section. Int. Rev. Reg., Series 7, No. 12, Revised, p. 31.

“He (the collector) should exercise good judgment and discrimination in making his recommendations, being governed by his knowledge that the Internal Revenue Office is opposed to criminal prosecutions for slight and unintentional violations of law. In cases, for instance, of failure to pay special taxes at the proper time, where the parties subsequently voluntarily come forward, make return, and pay tax and penalty, or where, from the circumstances, it is evident that there has been no purpose of evading the tax, it is not only right but it is incumbent on the collector to make such a detailed statement of the facts and circumstances as will leave in the mind of the United States attorney no uncertainty as to what course is required in the public interest.”

Where persons have knowingly and willfully violated the law, with the evident intention of defrauding the government of its revenues, vigorous measures should be taken to bring the parties to trial and punishment; but no encouragement should be given to the commencement of prosecutions for merely slight and unintentional offenses involving no loss to the government, and where no question of fraud is involved, and all complaints presented by professional informers should receive careful scrutiny before the commencement of prosecutions thereon.” Int. Rev. Reg., Series 7, No. 12, Revised,

p. 31.

It is to be noted that the penalty denounced by Sec. 3164 against the collector for not reporting a case of violation of law to the district attorney, viz., that " he shall forfeit his right to any compensation, benefit, or allowance in such case,' no longer has any force. This “ right to any compensation, benefit, or allowance” was part of the moiety system, which was repealed by Sec. 39, act June 6, 1872 (17 Stat. 256). The statute, however, makes it the duty of the collector to report every such case to the district attorney within ten days,

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