Westover

This is a suit for refund of a manufacturer’s excise tax imposed under Section 3406(a) (4) and Section 3444(a) (1), 26 U.S.C.A. which was allegedly illegally assessed and collected by the defendant. The Commissioner determined that an excise tax was due on the use of a “transfer machine” built by the plaintiff for use in the processing of colored motion picture film in its own plant. The evidence introduced at the trial was that of experts, whose testimony was directed toward proving, through a description of its technical operation, that the machine did ,or did not fall within the language of the Internal Revenue Code purporting to lay a tax upon articles of this or similar nature.

I find that the equipment involved is a part of the photographic apparatus as defined in said Section 3406(a) (4). This equipment is necessary for the developing of technicolor motion picture films and plays an important step in producing such colored films.

It is true only one transfer machine is involved but there is nothing from preventing plaintiff from building as many machines as it sees fit. It is plaintiff’s theory so long as it does not sell said machines it can escape the use tax. Under…