Frances T. Hong v. United States

Before us is an appeal by Frances T. Hong, plaintiff below and appellant here, hereinafter “Taxpayer”, in an action for recovery of manufacturers’ excise taxes alleged to have been overpaid for the years 1955-60, inclusive. The taxes in question were assessed against, and paid by, taxpayer doing business as Musical Sales Company, on the determination by the Commissioner that some of the uli-ulis manufactured by taxpayer were “musical instruments” within the meaning of § 4151 Internal Revenue Code of 1954 [26 U.S.C.A. 1958 ed., § 4151], and the regulations promulgated thereunder, Excise Tax Regulations § 40.4151-1 (c).

Section 4151 provided:

The Treasury regulations on Manufacturers and Retailers Excise Tax (1954 Code) Section 40.4151-l(c) provides:

Section 48.4151-1 (d) of Treasury Regulations on Manufacturers and Retailers Excise Tax (1954 Code), effective for the taxable years 1959-1960, is identical.

The instrument here involved — called uli-ulis, — are polished gourds, partially filled with seeds, attached to a handle and adorned with dyed feathers.

The District Court, sitting without a jury, after hearing testimony and viewing the demonstrations, held that the uli-ulis…