In August, 1928, the appellee, when equalizing and approving the personal assessment rolls of Lee county, increased the value of the appellant's capital stock, surplus, and undivided profits over that given in by it for assessment for taxation. This increase was approved by the circuit court.
On a proper blank furnished by the tax assessor therefor, the appellant listed its capital stock, surplus, and undivided profits for taxes as follows: Par value of shares and stock, one hundred thousand dollars, less forty-five thousand dollars which had been allotted by it to and is assessed to, its branch banks at Fulton and Middleton, Miss., leaving fifty-five thousand dollars as the par value of its capital stock subject to assessment in Lee county; surplus ninety-two thousand five hundred dollars, and undivided profits three thousand four hundred thirty-two dollars and five cents, making a total value of capital stock, surplus, and undivided profits of one hundred fifty thousand nine hundred thirty-two dollars and five cents, from which it deducted the true value of its real property, which is seventy-two thousand eight hundred thirteen dollars and thirty-two cents, leaving the true value of its capital stock surplus, and undivided profit, less real estate, seventy-eight thousand one hundred eighteen dollars and seventy-three cents. The appellee increased this assessment to one hundred thirteen thousand five hundred sixty-two dollars and five cents, by *Page 439 deducting from the value of the appellant's capital stock, surplus, and undivided profits, not the true value of its real estate, but the value at which it was assessed on the land assessment roll, which is thirty-seven thousand three hundred seventy dollars.
Section 1, chapter 193, of the Laws of 1920 (Hemingway's Code 1927, section 8203), provides that:
"The president, cashier, or other officer having like duties, of each bank or banking association in this state, existing by the laws of this state, shall deliver to the assessor of taxes of the county in which it is located, a written statement, on or before the first day of May of each year, under oath, of the number and amount of all the shares of its capital stock paid in, . . . and of the sum of all undivided profits or surplus or accumulation of any sort constituting part of the assets of the bank and not including its real estate; and the value of such shares estimated at par and increased by the proportion of the par value of all the shares of stock to the said surplus fund or accumulation, . . . shall be the basis of the taxation of such shares to the bank."
The question for decision then is: Where the land owned by a bank is assessed on the land rolls at less than its true value, which value thereof, its true or assessed value, should be deducted from the total value of the bank's capital stock, surplus, and undivided profits, in arriving at the value of its capital stock, surplus, and undivided profits for taxation under the statute?
Section 112 of the Constitution expressly requires all property to be assessed for taxation "according to its true value." Section 181 of the Constitution authorizes the legislature to "provide for the taxation of banks and banking capital, by taxing the shares according to the value thereof (augmented by the accumulations, surplus, and unpaid dividends), exclusive of real estate, which shall be taxed as other real estate." *Page 440
The Constitution and the statutes contemplate that banks shall be taxed on all of their property at its true value. The true value of the bank's capital stock, surplus, and undivided profits is the aggregate true value of all of its assets, in which of course, its real estate is included; from which it necessarily follows that, in determining the true value of a bank's capital stock, surplus, and undivided profits, exclusive of its real estate, the true value of its real estate must be deducted from the aggregate true value of all its assets. Bank of Commerce v. Adams County, 130 Miss. 37, 93 So. 442; Merchants' Farmers' Bank v. City of Kosciusko, 149 Miss. 835, 116 So. 88. That the real estate of a bank, which, under the Constitution and section 4275 of the Code of 1906 (Hemingway's Code 1927, section 8206), must be separately assessed as other real estate is, is actually assessed on the land assessment roll at less than its true value, is of no consequence here. That is a matter to be taken care of by the assessing authorities in making up and approving the land assessment roll. The statute has been so construed by the state tax commission.
The practical difficulties in assessing the property of a bank, which would arise under the construction of the statute which the appellee here seeks to place on it, are such as to demonstrate the error therein. The assessment of personal property is made each year; that of real property is made every two years. The capital stock, surplus, and undivided profits of a bank, exclusive of its real estate, is assessed on the personal assessment roll, and the information therefor must be given by the bank to the assessor on or before the first day of May of each year. In a year in which real estate is to be assessed, a bank could not know, prior to the 1st of May or for some time thereafter, what value would be placed on its real estate by the assessing authorities, and therefore *Page 441 it could not comply with the statute in giving in for assessment the value of its capital stock, surplus, and undivided profits, exclusive of its real estate, unless the assessment of its real estate theretofore made should be adopted, which theretofore assessed value of its real estate may be increased or lowered when the assessment for that year comes on thereafter to be made. In addition, the board of supervisors, in approving the assessment roll, could not act on the assessment of a bank's personal property until it had first fixed the assessed value of its real estate. Moreover, the real property of a bank must be assessed in the county where situated, and, when the bank owns property in more than one county, the assessed value of its personal property could not be fixed until the assessing authorities of all of the counties in which its real estate is situated had fixed the assessed value thereof.
The case of Magnolia Bank v. Board of Sup'rs of Pike County,111 Miss. 857, 72 So. 697, 3 A.L.R. 1365, relied on by the appellee, is not in point here. The appellant's complaint there was that under the statute its capital stock, augmented by its surplus and undivided profits, was assessed at its true value, less the value of its real estate, while the personal property of individuals was uniformly assessed by the taxing authorities at less than its true value, and the court held that the bank could not complain thereat, it being the duty of the assessing authorities to assess all property at its true value.
The judgment of the court below will be reversed, and the judgment which it should have rendered will be rendered; that is to say, the order of the board of supervisors of Lee county, raising the appellant's assessment on its capital stock, surplus, and undivided profits from seventy-eight thousand one hundred eighteen dollars and seventy-three cents to one hundred thirteen thousand six hundred sixty-two dollars and five cents, will be reversed *Page 442 and set aside, and the original assessment of the property at seventy-eight thousand one hundred eighteen dollars and seventy-three cents will be approved. On the receipt of the mandate from this court, the clerk of the court below will certify the judgment to the board of supervisors of Lee county.
Reversed, and judgment here for appellant.
Anderson, J., being disqualified, took no part in the decision of this case.