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Opinion of the Court.

“The authority of the Secretary to issue orders, regulations and instructions, with the approval of the President, in reference to matters connected with the naval establishment, is subject to the condition, necessarily implied, that they must be consistent with the statutes which have been enacted by Congress in reference to the navy. He may, with the approval of the President, establish regulations in execution of or supplementary to, but not in conflict with, the statutes, defining his powers or conferring rights upon others. The contrary has never been held by this court. What we now say is entirely consistent with Gratiot v. United States, 4 How. 80 and Ex parte Reed, 100 U. S. 13, upon which the government relies. Referring in the first case to certain army regulations, and in the other to certain navy regulations, which had been approved by Congress, the court observed that they had the force of law. See also Smith v. Whitney, 116 U. S. 181. In neither case, however, was it held that such regulations, when in conflict with the acts of Congress, could be upheld.”

The theory submitted on behalf of the plaintiff in error is:

(1) That the regulation made by the Commissioner of Internal Revenue and approved by the Secretary of the Treasury was a proper and a “needful” regulation under the oleomargarine law;

(2) That this regulation was an outgrowth of the statute and acquired and possessed the force of law;

(3) That the keeping of the records and the reporting of the details of the business, supervised under the law, became, as to the defendant, “things required by law in the carrying out or conducting of his business” (sec. 18);

(4) And that being authorized by Congress, and being formulated and promulgated pursuant to an enactment, and being subordinate to, and in furtherance of, the statute, and not in conflict with it, the regulation should, under the decisions, be sustained and the demurrer should be overruled.

Mr. P. A. Collins for defendant in error.

MR. JUSTICE BLATCHFORD, after stating the case, delivered the opinion of the court.

Opinion of the Court.

Sections 1 and 2 of the act in question define what is “butter” and what is “oleomargarine.”

Section 3 imposes special taxes of certain amounts on manufacturers of oleomargarine, on wholesale dealers therein, and on retail dealers therein.

Section 4 imposes a penalty on manufacturers, wholesale dealers, and retail dealers, for carrying on those respective businesses without having paid the special tax therefor.

Section 5 provides that every manufacturer of oleomargarine sball file with the collector of internal revenue of the district in which his manufactory is located, such notices, inventories and bonds, shall keep such books, render such returns of materials and products, put up such signs, affix such number to his factory, and conduct his business under such surveillance of officers and agents, as the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, may, by regulation, require. But that section imposes no penalty for a non-compliance with its provisions.

Section 6 contains requirements in regard to the packing of oleomargarine by manufacturers, and in regard to the packages in which sales shall be made by manufacturers, wholesale dealers and retail dealers, and imposes a penalty for the violation of its requirements.

Section 7 contains requirements as to putting a label on each package by the manufacturer, and imposes a penalty for not doing it.

Section 8 provides for collecting a tax of two cents a pound on the article from the manufacturer by coupon stamps, and applies the requirements of law as to stamps relating to tobacco and snuff.

Section 9 provides for assessing and collecting the tax which has not been paid by stamps, and declares that such tax shall be in addition to the penalties imposed by law for the sale or removal of the article without the payment of such tax.

Section 10 provides for an additional tax on imported oleomargarine, by stamps to be affixed and cancelled while it is in the custody of custom officers, and for warehousing the article; and it imposes a penalty for a violation of the section by a

Opinion of the Court.

customs officer, and a penalty for selling or offering for sale imported oleomargarine not put up in packages and stamped as provided by the act.

Section 11 imposes a penalty for purchasing or receiving for sale any oleomargarine not branded or stamped according to law, and § 12 a penalty for purchasing the article or receiving it for sale from a manufacturer who has not paid the special tax.

Section 13 requires the destruction of stamps on packages which have been emptied, and imposes a penalty for the failure to do so.

Section 14 provides for the appointment of chemists and microscopists, and authorizes the Commissioner of Internal Revenue to decide what articles are taxable under the act, and what substances made in imitation or semblance of butter, and intended for human consumption, contain ingredients deleterious to the public health, and also provides for appeals from the decision of the Commissioner of Internal Revenue to a board of three officers, whose decision shall be final.

Section 15 provides for the forfeiture of packages which are not stamped, and of packages intended for human consumption which contain ingredients so adjudged to be deleterious to the public health, and imposes a penalty for removing or defacing stamps, marks or brands on packages containing oleomargarine taxed as provided in the act.

Section 16 contains a provision for the export of oleomargarine to a foreign country without the payment of tax or affixing stamps, under regulations to be made by the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, and for the branding of the exported packages; but it prescribes no penalties.

Section 17 provides that if any manufacturer of oleomargarine defrauds or attempts to defraud the United States of the tax thereon, he shall forfeit the factory, manufacturing apparatus, and all oleomargarine and raw material found in the factory and on the premises, and be fined and imprisoned as provided in that section.

Section 18 is as follows: "That if any manufacturer of oleo

Opinion of the Court.

margarine, -any dealer therein or any importer or exporter thereof shall knowingly or wilfully omit, neglect or refuse to do, or cause to be done, any of the things required by law in the carrying on or conducting of his business, or shall do anything by this act prohibited, if there be no specific penalty or punishment imposed by any other section of this act for the neglecting, omitting or refusing to do, or for the doing or causing to be done, the thing required or prohibited, he shall pay a penalty of one thousand dollars; and if the person so offending be the manufacturer of or a wholesale dealer in oleomargarine, all the oleomargarine owned by him, or in which he has any interest as owner, shall be forfeited to the United States."

Section 19 provides that all fines, penalties and forfeitures imposed by this act may be recovered in any court of competent jurisdiction ;” and section 20 “ that the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, may make all needful regulations for the carrying into effect of this act."

Section 21 is unimportant as regards this case.

It is stated in the brief of the Assistant Attorney General, counsel for the United States, that one of the regulations of August 25, 1886, named in the two counts of the indictment, and claimed to be applicable to the present case, was as follows : “Wholesale dealers in oleomargarine will keep a book (Form 61) and make a monthly return on Form 217, showing the oleomargarine received by them, and from whom received; also, the oleomargarine disposed of by them and to whom sold or delivered ;” that that regulation covers the two counts of the indictment and the two questions certified; and that Form 61, so referred to, is a form for a record in a book, and Form 217 is one for the monthly return; and it is claimed that such regulation was properly made under $ 20 of the act.

It is provided by $ 41 of the act approved October 1, 1890, c. 1214, entitled "An act to reduce the revenue and equalize duties on imports, and for other purposes," 26 Stat. 567, 621, “that wholesale dealers in oleomargarine shall keep such books and render such returns in relation thereto as the Com

Opinion of the Court.

missioner of Internal Revenue, with the approval of the Secretary of the Treasury, may, by regulation, require, and such books shall be open at all times to the inspection of any internal revenue officer or agent."

But, although the regulation above recited may have been a proper one to be made, under $ 20 of the act of August 2, 1886, yet the question to be determined in this case is whether a wholesale dealer in oleomargarine, who knowingly and wilfully fails and omits to keep the book and make the monthly return prescribed in the regulation of the Commissioner of Internal Revenue, thereby fails and omits, within the meaning of § 18 of the act, to do a thing “required by law in the carrying on or conducting of his business," so as to be liable to the penalty prescribed by that section.

In this connection, it is worthy of observation that $ 5 of the act requires that every manufacturer of oleomargarine shall keep such books, and render such returns of materials and products, as the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, may, by regulation, require; but it imposes no penalty on the manufacturer for any neglect to keep such books and render such returns, nor does it impose a duty to keep the books and render the returns on a wholesale dealer in the article, such as the defendant in this case was. The question, therefore, is whether a wholesale dealer in oleomargarine, who omits to keep the books or to render the returns prescribed by the regulation made under the authority of $ 20 of the act, is liable to the penalty prescribed by $ 18, as having omitted or failed to do a thing“ required by law in the carrying on or conducting of his business,” within the meaning of $ 18.

Regulations for carrying the act into effect, to be made under the provisions of $ 20, are necessary, as they are in various departments of the public service. By § 161 of the Revised Statutes, the head of each department is authorized “to prescribe regulations, not inconsistent with law, for the government of his department, the conduct of its officers and clerks, the distribution and performance of its business, and the custody, use and preservation of the records, papers and

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