proposition that as a taxing statute was usually confined to persons within the territorial jurisdiction of a taxing authority and to do otherwise would be exceptional, unless such view was compelled by its terms, the statute here involved ought not to be construed as having been adopted to accomplish such unusual and strange result. The directly opposite, is here applicable, since it is usual, where the taxing power is called into play as to an individual domiciled within the territorial limits of the taxing authority, to cause the manifestation of taxing power to be coterminous with the taxing authority of the Government levying the tax. Therefore it follows that the principle of interpretation previously applied has no possible application to the construction of the word 'use,' which we are now considering." Foreign built vessel. A vessel originally built in a foreign country but rebuilt in the United States with new materials purchased in a foreign country, is not a foreignbuilt vessel within the meaning of the statute. United States v. Investors, etc., Realty Co., (C. C. A. 2d Cir. 1914) 214 Fed. 67. Persons liable to tax. - Citizens of the United States permanently resident and domiciled in a foreign country are not subject to the tax imposed by this section. U. S. v. Goelet, (1914) 232 U. S. 293, 34 S. Ct. 431, 58 U. S. (L. ed.) 610, wherein the court said: "Not in the slightest degree questioning that there was power to impose the excise duty on the citizen owning a foreign-built yacht wholly irrespective of the fact that he was permanently domiciled in a foreign country and putting out of view all questions concerning the non-application of the statute to the case in hand purely because of the situs of the yacht itself, the single matter for decision is, do the terms of the statute provide for the payment by a citizen of the United States who has a permanent residence and domicile abroad of an excise duty because of the use by him as owner or charterer under the terms of the statute of a foreign-built yacht. It may not be doubted, as observed by the trial court in these cases (omitting the consideration of taxes imposed on property having a situs within the jurisdiction of the taxing authority), speaking in a general sense that the taxing power, when exerted, is not usually applied to those, even albeit they are citizens, who have a permanent domicile or residence outside of the country levying the tax. Indeed we think it must be conceded that the levy of such a tax is so beyond the normal and usual exercise of the taxing power, as to cause it to be, when exerted, of rare occurrence and in the fullest sense exceptional. This being true, we must approach the statute for the purpose of ascertaining whether its provisions sanction such rare and exceptional taxation. Considering the text, we search in vain for the express declaration of such authority. True, it is argued by the United States, that as the tax is levied on any citizen using a for eign-built yacht and as any includes all, therefore the statute expressly embraces a citizen permanently domiciled and residing abroad. But this argument in effect begs the question for decision which is whether the use of the general words, any citizen, without more should be considered as expressing more than the general rule of taxation, or in other words can be treated without the expression of more as embracing the exceptional exertion of the power to tax one permanently residing abroad. As illustrative and throwing light on the real question for decision, action taken by Congress in exerting its taxing power is at least worthy of note. For instance the provisions of the income tax law of June 30, 1864 (c. 173, 13 Stat. 223, 281), expressly extended that tax to those domiciled abroad and a like purpose is beyond doubt expressed in the income tax of 1913 (subdivision 1 of the Tariff Act of October 3, 1913). But without resting this case upon the implication against the conferring of the au thority here claimed from the mere want of express statement in the statute of the giving of such exceptional power, and treating such implication as not in and of itself absolutely conclusive, we think when to the force of such inference, even though it be limited, there is added the weight arising from that which is expressly stated in the statute, the conclusion against want of power conferred to levy the tax here asserted is established. This arises from the command of the statute that the tax shall be levied by the collector of customs of the district nearest the residence of the managing owner,' etc., since the consequence of such command is to associate residence with citizenship and establishes such a relationship between them as to bring about the result which we have just stated. Nor do we think there is anything as suggested by the argument of the United States in the case of Eidman v. Martinez, 184 U. S. 578, which militates against the views just stated and this also is true of the suggestion made in argument concerning the circulation by those interested in the enactment, of the provision of a list of yachts which would become subject to the tax if the provision was enacted, which list included the yacht taxed in this case expectations of those who sought the enactment of legislation may not be used for the purpose of affixing to legislation when enacted a meaning which it does not express." See to the same effect U. S. v. Bennett, (1914) 232 U. S. 308, 34 S. Ct. 437, 58 U. S. (L. ed.) 616. The Tax when due. In Billings v. U. S., (1914) 232 U. S. 261, 34 S. Ct. 421, 58 U. S. (L. ed.) 596, the question arising whether a tax on a yacht under the section became due in September 1909, the court said: "Was the tax due on the first day of September, 1909, or was it only due on the same day in September, 1910? In view of the positive direction that the tax shall be levied and collected on the first day of September, we can see no escape from the conclusion that the court below was right in holding that it became due on the first day of September after the passage of the act. The word 'annually' upon which so much reliance to the contrary is placed, is manifestly used not for the purpose of postponing the time of payment, but rather as provision for continuity; that is, the word but shows the purpose of fixing the annual duty of levying and collecting the tax on the designated day. This becomes quite apparent when it is observed that if the word 'annually' be removed, there would be room for the implication that the tax was to be but sporadic and would therefore cease to be collectible after one payment. And it is equally clear that the six months clause is concerned not with the period when the tax imposed shall be levied and collected, but addresses itself to the subject-matter upon which the tax is placed; in other words, it qualifies the word 'charter' and therefore only indicates when the use of a chartered vessel shall become subject to the duty imposed." See also to the same effect U. S. v. Bennett, (1914) 232 U. S. 299, 34 S. Ct. 433, 58 U. S. (L. ed.) 612; Rainey v. U. S., (1914) 232 U. S. 310, 34 S. Ct. 429, 58 U. S. (L. ed.) 617. The validity of the option to pay an ad valorem duty of 35 per cent contained in this section is not in issue where the action is to recover a tax against an owner of a foreign built yacht who has not seen fit to exercise his option. Rainey v. U. S., (1914) 232 U. S. 310, 34 S. Ct. 429, 58 U. S. (L. ed.) 617, wherein it was contended that error was committed in not deciding that § 37 of the act of 1909 "in so far as it lays a duty of 35 per cent. ad valorem is 832 a direct tax and void because not apportioned in contravention of Art. I, § 2, and Art. I, § 9 of the Constitution of the United States." To this contention the court replied as follows: "We think the reasons given in the comprehensive opinion of the lower court in ruling adversely on this proposition are so conclusive that we adopt them and make them our own. The court said: "The owner is not required to pay this duty. He is merely given the option to pay it. In its nature it would seem to be a duty on imports and such duties are not held to be direct taxes requiring apportionment. But it is unnecessary to pass upon this question. These actions are for the recovery of the annual tonnage tax and the validity of the ad valorem tax is not involved. The provisions concerning that tax are separable from those concerning the annual tax. The one is not dependent upon the other and there is no indication that Congress would not have adopted the one without the other. Under such conditions it is well settled that unconstitutional provisions may be separated from legal provisions and effect be given to the latter." An action in personam lies against the owner of a foreign-built yacht liable to a tax under this section for its recovery. Rainey v. U. S., (1914) 232 U. S. 310, 34 S. Ct. 429, 58 U. S. (L. ed.) 617; Billings v. U. S., (1914) 232 U. S. 261, 34 S. Ct. 421, 58 U. S. (L. ed.) 596. Interest is recoverable by the government on taxes imposed by this section from the time when they become due. Billings v. U. S., (1914) 232 U. S. 261, 289, 34 S. Ct. 421, 428, 58 U. S. (L. ed.) 596, 608, modifying (S. D. N. Y. 1911) 190 Fed. 359. Answer to petition. Sufficiency, 357 note. Taken as true, 357 note. Waiver of jurisdiction, 357 note. Administrative orders, 361 note. Creditors asserting both debt and lien, Decisions held appealable, 360 note. Order confirming composition, 363 note. Questions of fact, 363 note. Assets, collection by trustee, 369 note. Fees in involuntary bankruptcy, 564 Fees of trustee's attorney, 386 note. Avoiding transfers. Insolvency of transferor, 405 note. Pleading, 405 note. Plenary suit, 405 note. Power conferred on trustee, 404 note. Ancillary jurisdiction, 332 note. Enjoining interference with jurisdic- Independent suits at law or equity, 331 Inquiry into validity of debt or obliga- Orders and records, power over, 331 Personal judgments against debtors, 331 note. Reopening of estate, 332 note. Bill in equity to recover voidable prefer- Bona fide purchasers, 392 note, 395 note. Petitioning creditor, 336 note. Trustees, 374 note. Bondholders as general creditors, 387 |