In the Matter of John West Gwilliam, Bankrupt. John West Gwilliam v. United States

THE APPEAL

The Bankruptcy Judge on January 25, 1974 ordered that certain federal taxes due and owing by the Bankrupt for more than three years were provable debts of the Bankrupt and discharged in bankruptcy. On review, the District Court reversed and remanded. The Bankrupt appeals; we note the jurisdiction of this court under 28 U.S.C. § 1291 and 11 U.S.C. § 47 , and reverse.

ISSUE

The sole issue on appeal is whether the Bankruptcy Court had jurisdiction to determine the amount or legality and dis-chargeability of the alleged due and unpaid federal taxes when the Internal Revenue Service (IRS) had not filed a proof of claim or otherwise participated in the bankruptcy proceedings, except to object to the Bankruptcy Court’s jurisdiction.

PROCEEDINGS IN THE BANKRUPTCY AND DISTRICT COURTS

The Bankrupt filed an Application to Determine Dischargeability of Debt, alleging that certain income taxes due and owing to the United States of America (Government) from the Bankrupt for more than three years prior to bankruptcy were income tax dischargeable debts under Section 17(a) and (c) of the Bankruptcy Act, as amended in 1966 and 1970, 11 U.S.C. § 35 (a) and (c) [hereinafter §…