such notice until payment thereof shall be made, and shall be added thereto and collected therewith by the comptroller. (Sec. 196, former seo. 193, Tax Law, ch. 317, L. 1915.)

Source: L. 1880, ch. 542, secs. 15, 16, as added by ch. 501, L. 1885, without change of substance.

Recent Amendments.-The amendment of 1915 substituted commission for comptroller and added the words at the end of the section as to the collection by the comptroller.

Payment of tax and penalty for failure.-A tax imposed by section one hundred and eighty-two or one hundred and eighty-six of this chapter, shall be due and payable into the state treasury on or before the fifteenth day of January in each year. A tax imposed by section one hundred and eighty-four of this chapter on a transportation or transmission corporation, or by section one hundred and eighty-five, on elevated railroads or surface railroads not operated by steam shall be due and payable into the state treasury on or before the first day of August in each year. A tax imposed by section one hundred and eighty-seven of this chapter on an insurance corporation shall be due and payable into the state treasury on or before the first day of June in each year. A tax imposed by section one hundred and eighty-eight, one hundred and eighty-eight-a or one hundred and eighty-nine shall be due and payable into the state treasury on or before the first day of September in each year. A tax imposed by section one hundred and ninety-one of this chapter on a foreign banker shall be due and payable into the state treasury on or before February first in each year. If such tax in any case is not paid within thirty days after the same becomes due, or if the report of any such corporation is not made within the time required by this article, the corporation, association, joint stock company, person or partnership, liable to pay the tax, shall pay into the state treasury in addition to the amount of such tax, a sum equal to five per centum thereof, and one per centum additional for each month the tax remains unpaid, which sum shall be added to the tax and paid or collected therewith. Every corporation, association, joint stock company, person or partnership failing to make the annual report required by this article, or failing to make any special report required by the commission, within any reasonable time to be specified by the commission, shall forfeit to the people of the state the sum of one hundred dollars for every such failure, and the additional sum of ten dollars for each day that such failure continues. Such tax shall be a lien upon and bind all the real and personal property of the corporation, joint stock company or as

sociation liable to pay the same from the time when it is payable until the same is paid in full. (Sec. 197, former sec. 194, Tax Law, as amended in 1901, chs. 118, 132 and 558, ch. 317, L. 1915 and 707, L. 1917.)

Source: L. 1881, ch. 361, secs. 4, 5, 6, 7; L 1882, ch. 409, sec. 322, as amended by L. 1895, ch. 196; L. 1886, ch. 679, sec. 1, as amended by L. 1895, ch. 418.

Recent Amendments.-The amendment of 1915 substitutes commission for comptroller. The amendment of 1917 inserts the reference to section one hundred and eighty-eight-a (investment companies).

Settlement by comptroller of tax after January 15th.-The comptroller may settle an account for a tax imposed by section 182, Tax Law, after the 15th day of January in the year in which the tax becomes due. People ex rel. F. A. Stokes Co. v. Roberts, 90 Hun, 533 (1895).

Lien of tax on real and personal property.-The precise time at which the lien attaches does not appear to be fixed by the statute. Section 197 of the Tax Law provides that the tax is due and payable on or before the various dates mentioned therein. It also appears that such tax may be settled after the dates mentioned (People ex rel. Stokes Co. v. Roberts, supra). It is not unreasonable to suppose that it runs from the time mentioned in section 196, viz., from the day the tax is audited and stated, and notice thereof sent to the corporation or person chargeable therewith. This is on the theory applied in the local taxation of real and personal property, when a tax is presumed to be due at the time it is fixed and extended on the tax rolls. Lathers v. Keogh, 109 N. Y. 583 (1888); Burr v. Palmer, 53 App. Div. 358 (1900).

Priority in payment of state tax from insolvent estate.State taxes are entitled to a priority in payment out of the funds of an insolvent corporation by a receiver appointed in proceedings to foreclose a mortgage on the company's property. Central Trust Co. v. N. Y. C. & H. R. R. Co., 110 N. Y. 250 (1888). In a recent case where the property of an insolvent corporation was operated by the receiver pendente lite, and franchise taxes were

levied during the time of such operation, it was held that the plaintiff who bought the property at a foreclosure sale "subject to all taxes which might be levied thereon at the time of the sale," had taken the property subject to such lien, and that the state's taxes were paramount to all prior encumbrances. N. Y. Terminal Co. v. Gaus, 204 N. Y. 512 (1912).

In the Matter of Carnegie Trust Co., 206 N. Y. (1912), 398, the court said that while it entertained no doubt as to the wisdom of adopting the doctrine that the state may claim priority in respect to the payment of taxes, "there is one limitation. and that pertains to claims in which a prior specific lien has been obtained by the creditors" citing Wise v. Wise Co., 153 N. Y. 507.

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In the latter case taxes assessed upon the personal property of a corporation became due subsequent to the levy of an attachment and execution by creditors. The corporation was insolvent and a receiver appointed. The receiver of taxes sought to have his claim satisfied in preference to the judgment on the theory that the sovereign from most ancient times was entitled to priority of payment over all claims by subjects. The court did not sustain this contention, but held there was no authority for preferring such claims over specific prior liens-distinguishing Central Trust Co. v. N. Y. C. (supra).

The Federal Court in construing this very section (sec. 197) and having before it the question of whether the state has a priority of payment out of a fund in court for distribution, in the case of Central Trust Co. v. Third Ave. R. Co., 186 Fed. 291 (1911) says: "We think it fair to suppose the legislature intended to make the tax a lien on the property in its then condition," i. e., at the time the lien accrued, and therefore subject to the mortgage.

In Sweet v. The All-Package Grocery Stores Co., U. S. District Court for the Southern District of New York, reported in the N. Y. Law Journal of April 25, 1919, Judge Hand held: that, while as a matter of general administrative procedure the state courts have decided that a tax or other indebtedness to the state is entitled to payment prior to all claims not based on a specific lien, the federal courts will not grant such a priority under the Bankruptcy Law

unless such a lien exists; that there is no essential difference between a license fee to begin business (181) and a license fee to continue business (182) excepting that under the provisions of section 197 a lien is imposed in the latter case. The court in this case quotes with approval the three cases mentioned above.