United States v. John O. England, Trustee in Bankruptcy of the Estate of Bradford Welch, Inc., a Corporation, Bankrupt

The question here for solution is the status of a claim of the United States for taxes filed in a bankruptcy proceeding. Bradford Welch, Inc., the taxpayer, was adjudicated a bankrupt on July 23, 1951. John O. England was thereafter appointed Trustee in Bankruptcy.

On April 28, 1952 the Collector of Internal Revenue filed a claim with the Trustee in Bankruptcy for withholding and insurance contributions taxes and interest thereon. An amended claim was filed August 22, 1952, claiming the sum of $2,192.64 in taxes and interest due. Óf this amount the sum of $945.37 was asserted to be secured by liens on the property of Bradford Welch, Inc., by virtue of the provisions of §§ 3670 and 3671 of the Internal Revenue Code of 1939 for the reason that on this amount assessment lists had been received by the Collector and demand duly made' prior to the adjudication of bankruptcy. The Trustee objected. The Referee in Bankruptcy allowed the claim in its entirety as a priority claim, but disallowed any part thereof as a secured claim because “the United States never has filed any notice of the aforesaid claimed statutory lien as provided in § 3672 of the Internal Revenue Code.” Sec. 3672(a)…