United States v. Dixon/Opinion of the Court

The sole question here is whether §§ 3116 and 3115 of the Internal Revenue Code, 26 U.S.C.A., make it a criminal offense to possess property intended for use in producing nontax-paid distilled spirits in violation of the Code. Appellee was indicted under these sections for wilfully and knowingly possessing 800 pounds of sugar and parts of a still for the proscribed purpose. On motion the District Court, relying on dictum in a court of appeals decision, dismissed the indictment on the ground that § 3116 is 'preventative and remedial rather than criminal, and that it does not define a criminal offense.' The Government appealed directly to this Court under the Criminal Appeals Act, 18 U.S.C. § 3731, 18 U.S.C.A. § 3731. 346 U.S. 930, 74 S.Ct. 320.

Section 3116 of the Internal Revenue Code is captioned 'Forfeitures and seizures', and provides in pertinent part: 'It shall be unlawful to have or possess any liquor or property intended for use in violating the provisions of this part, or the internal-revenue laws * *  * and no property rights shall exist in any such liquor or property. * *  * Nothing in this section shall in any manner limit or affect any criminal or forfeiture provision of the internal-revenue laws, or of any other law. * *  * ' The section also provides for search warrants and for procedure in seizure and forfeiture. Section 3115 bears the caption 'Penalties' and provides that anyone violating any of the provisions of 'this part' for which offense a special penalty is not prescribed 'shall be liable, for the first offense, to a penalty of not exceeding $1,000, or imprisonment not exceeding thirty days, or both * *  * .' The two sections are included within the same 'part' of the Code.

The appellant's position is that § 3115 makes violation of any of the provisions of 'this part' a criminal offense punishable by fine and imprisonment; § 3116 contains a provision making it unlawful to possess property intended for use in violating the provisions of that part or the internal revenue laws; hence the indictment alleging a violation of §§ 3116 and 3115 by such possession charges a crime. We agree and so hold. We think the plain language of the two sections read together can lead only to the conclusion that the acts proscribed in § 3116 not only may result in forfeiture but likewise are made criminal and punishable under the general penalty provisions of § 3115.

The sections here involved were borrowed, with changes insignificant for present purposes, from the National Prohibition Act of 1919, 41 Stat. 305 et seq. There the sections appeared as §§ 25 (compare § 3116) and 29 (compare § 3115) of Title II, and presented a statutory pattern virtually identical to the present one. It is most persuasive that the courts consistently upheld criminal prosecutions brought under these sections for the analogous act of possessing property designed for the manufacture of liquor intended for use in violation of Title II of the Prohibition Act.

This consistency of interpretation, followed by Congress' utilization in the Code of the same provisions, is also helpful in dealing with the limitation in § 3115 which makes the penalties of that section applicable only where no 'special penalty' is provided for the offense. As a de novo proposition it might be argued that in § 3116 a special penalty, forfeiture, is provided. But this argument was available with equal force under the Prohibition Act and appears to have barred no prosecution. Moreover, § 3116 contains a provision that 'Nothing in this section shall in any manner limit or affect any criminal * *  * provision of the internal-revenue laws'. This would seem to settle the point.

Clearly Congress may impose both a criminal and a civil sanction in respect to the same act; this is neither unusual nor constitutionally objectionable. See Helvering v. Mitchell, 1938, 303 U.S. 391, 399-400, 58 S.Ct. 630, 633, 82 L.Ed. 917. Likewise it is common in drafting legislation to declare certain acts unlawful in one section and set forth penalties for their commission in another.

The only suggestion on the face of the statute that § 3116 was meant to be remedial and nothing more comes from its caption, 'Forfeitures and seizures', supplied by the codifiers in 1939. But in enacting the Code Congress provided that 'The arrangement and classification of the several provisions of the Internal Revenue Title have been made for the purpose of a more convenient and orderly arrangement of the same, and, therefore, no inference, implication or presumption of legislative construction shall be drawn or made by reason of the location or grouping of any particular section or provision or portion thereof, nor shall any outline, analysis, cross reference, or descriptive matter relating to the contents of said Title be given any legal effect.' 53 Stat. 1a. To accomplish its primary purpose of bringing together all operative revenue laws and making them more comprehensible, the Code made 'liberal use of catchwords.' Typically, § 3116 is included in a subchapter entitled 'Industrial Alcohol' and in a part entitled 'Industrial Alcohol Plants'; yet even under a most narrow interpretation of its terms the section is in no sense limited to industrial alcohol.

So far as light is to be had from legislative history, it is meager and inconclusive, in no way militating against the meaning we attribute to the statute.

Reversed.

Mr. Justice BLACK, with whom Mr. Justice DOUGLAS, Mr., Justice JACKSON and Mr. Justice MINTON concur, dissenting.