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Keywords

plaintiffstatuteappealhearingequitable relief

plaintiffdefendantjurisdictionstatuteappeal

Related Cases

Marsh v. Brown, 31 Conn.Supp. 134, 325 A.2d 466

Facts

The plaintiffs, including Bryan H. Marsh, filed a claim for a refund of $2,657 due to erroneous tax instructions regarding long-term capital gains. After the Tax Commissioner announced that overpayments would be refunded automatically, the plaintiffs received their refund but not the interest they claimed. The Commissioner denied their request for a hearing on the interest claim, stating there was no statutory provision for such payment.

On October 25, 1972, the plaintiffs filed a claim for a refund with the commissioner, seeking $2657 as the amount of the overpayment resulting from the erroneous instructions regarding the taxability of long-term capital gains, plus interest at 6 percent from April 15, 1972, to the date of payment of the refund.

Issue

Whether the court has the authority to award interest on a tax refund that was administratively issued before the appeal was filed.

The substantial issue in the case is whether the court is empowered to award interest on a refund for a tax overpayment where the refund was made by the commissioner before commencement of suit.

Rule

The court may grant equitable relief and order the payment of interest on tax refunds only if expressly authorized by statute.

Said court may grant such relief as may be equitable and, if such tax has been paid prior to the granting of such relief, may order the treasurer to pay the amount of such relief, with interest at the rate of six per cent per annum, to the aggrieved taxpayer.

Analysis

The court analyzed the relevant statutes and determined that while interest could be awarded on refunds ordered by the court, there was no express provision for interest on refunds made administratively by the Tax Commissioner. The court concluded that the absence of such a provision in the capital gains and dividends tax statute indicated that the legislature did not intend for interest to be paid on administrative refunds.

The statutory language empowering the commissioner to ‘make such order in the premises as appears to him just and lawful’ seems quite broad and general in contrast to the description of his authority in some other taxation statutes.

Conclusion

The court dismissed the appeal, affirming that it could not award interest on the administrative refund due to the lack of statutory authority.

It is ordered that judgment enter dismissing the appeal.

Who won?

The Tax Commissioner prevailed in the case because the court found no legal basis to award interest on the administrative refund.

The defendant attacks the jurisdiction of this court over the subject matter of this suit.

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