THE ATI-ORNEY GENERAL
OF =XAS
Ausnlv 11. TEXAS
BVIJiL WILSON
A1TGRNEY GENERAI.
March 16, 1961
Honorable Robert S. Calvert Opinion No. NW-1019
Comptroller of Public Accounts
Capitol Station Re: Whether the Comptroller is
Austin, Texas precluded by Art. 10.14(3),
V.C.S., from refunding the
tax paid on special fuels
connecting to and feeding
the carburetor of a motor
vehicle when the flow line
connecting said tank and
carburetor is temporarily
cut off by valve pending
use of such special fuels
to operate stationary
Dear Mr. Calvert: pumping unit 9.
You have asked this department for an opinion on the ques-
tion hereinafter set forth and have given US a stated set of facts in
connection therewith which are as follows:
“The Western Oil Transportation Company,
Inc., Midland, Texas, operates fifty or more
truck tractors hauling crude -oil and other
petroleum liquids in cargo tanks mounted on
semi-trailers, which trucks are equipped with
motor-powered units used to pump the oil into
and from the cargo tanks. The pumping units
are propelled by the same motor which propels
the trucks in daily travel over the public
roads and highways in going to and from
storages and oil well locations or other out-
lets.
“Each truck is equipped with two separate
fuel tanks both of which are connected to and
feed the carburetor which supplies special
fuels to the truck’s motor whic,hgenerates
power for the propulsion of the truck on the
highway and also the power which operates the
pumping units to load and unload the cargo
tanks . The pumping units do not operate while
the truck is moving over the highway. Each of
Honorable Robert S. Calvert, Page 2 (Opinion No. WW-1019)
the two fuel supply tanks is equipped with a
cutoff valve, and the claimant states that the
fuel from one tank is used to propel the vehicle
over the highway and fuel from the other tank
is used to operate the motor-powered pumping
unit.
"This company is classified by Article
10.11-(l) as a non-bonded user who is required
to pay the tax to the supplier on all special
fuels purchased."
Your question is as follows:
"1. Is the Comptroller precluded by
Article 10.14(3), above quoted, from re-
funding the tax paid on special fuels
delivered by a licensed user into a separate
fuel tank connected to and feeding the car-
buretor of a motor vehicle when the flow
line connecting said tank and carburetor is
temporarily cut off by valve pending use of
such special fuels to operate stationary
pumping units?"
Chapter 10, Title 122A, V.C.S., provides for the tax on
special fuels.
Article 10.14, Chapter 10, Title 122A, V.C.S., provides
for refunds and Sections 1, 2 and 3 of such Article 10.14 read as
follows:
"(1) Except as otherwise provided by
Article 10.15 of this Chapter, any licensed
dealer who shall have paid the tax imposed
by this Chapter upon any liquefied gas or
distillate fuel which has been used or sold
for use by such dealer for any purpose other
than propelling a motor vehicle upon the
public highways of this State, or which has
been sold to the Unlted States Government for
the exclusive use of said government, and any
licensed user who shall have paid said tax
upon any liquefied gas or distillate fuel
which has been used by such user for any pur-
pose other than propelling a motor vehicle
upon said public highways, may file claim
for a refund of the tax or taxes so paid,
r r
Honorable Robert S. Calvert, Page 3 (Opinion No, WW-1019)
less one percent (1%) allowed suppliers for
the expense of collecting and reporting such
taxes to this State. Such ,claimsshall be
filed with the Comptroller on forms prescribed
by the Comptroller and shall show the date of
filing and ~theperiod covered in the claim,
the gallons of~liquefied gas and the gallons
of distillate fuel sold or used for purposes
subjectsto taxirefund, and shall show such
other facts and information as the Comptroller
may by rule and regulation require. Every such
claim shall be supported by an invoice or
invoices issued by the claimant, as hereinafter
provided, and shall be verified by affidavit
of the claimant and filed in the office of the
Comptroller within six (6) months from the date
the special fuels were invoiced or required to
be invoiced for sale or use, and no claim shall
,be made by the’claimant or approved by the
Comptroller when the sale of such special fuels
or the appropriation for use occurs more than
six (6) months prior to the date the claim is
filed.
“(2) When liquefied gas or distillate fuel
is sold~by a deal~eror is appropriated for use
byea user for any purposes for which a refund
of the tax paid on said products may be claimed
as provided herein, such dealer or user shall,
at the time of each sale or appropriation for use
and not thereafter, make out a serially numbered
invoice in not less than duplicate counterparts
with the name and address of the dealer or user
printed thereon which shall show the date of the
sale or appropriation for use, the quantities
of liquefied,gas and/or distillate fuel sold
or appropriated for use, the purposes for which
said products will be used, as declared by the
purchaser or user, and such other information as
the Comptroller may require. The invoice shall
be signed by the recipient of any such special
fuels purchased from a dealer. One ccunterpart
of each invoice shall be kept by,the dealer or
user for a period of two (2) years open to the
inspection of the Comptroller ‘or hisauthorized
represenbatives, and the other counterpart shall
be fil,edas a part of the ,claimfor tax refund
as above provided.
Honorable Robert S. Calvert, Page 4 (Opinion No. WW-1019)
I’(3) Any dealer or user who shall
file claim for refund of the tax on
any special fuel which has been de-
livered into the fuel supply tank of a
motor vehicle, or who shall file any
invoice in a claim for tax refund upon
which any date, figure, signature, or
other material information is false or
incorrect, shall forfeit his right to
the entire amount of the refund claim
‘filed.”
Attorney General’s Opinion No. o-2381, written by this
department under date of July 25, 1940, covers several questions
in connection with refunds of taxes on motor fuels. Some of the
situations covered in this opinion are as follows:
“1. Oil field equipment ia used which
Is a licensed or registered motor vehicle
(truck). On this truck is mounted a
drilling rig. The truck motor is used for
tf;;mp;fi;Eef;p$;aepropelling the vehicle
which may be on
public roads or highways, private property,
such as leases, or both; (b) operating the
equipment mounted on the truck strictly
as a stationary engine. This is accomplished
through a power take-off which separates the
motor from the truck while so used.
“2. This same procedure is used in
connection with the following classes of
work; namely, post-hole drilling for power
lines, pumping oil into tank built on the
same truck, feed-grinding mills, oil well
cementing, oil well treating, fire engines
for pumping water on fire after arrival.”
,I. . . .
“The following situation has never
arisen; however, the facts are true, and
as such must be given consideration. A
farmer or rancher uses a registered truck;
thereon he would have two fuel tanks and
keep the fuel used for traveling on the
roads or highways separate from that used
while driving the same truck on his private
Honorable Robert S. Calvert, Page 5 (Opinion No. WW-1019)
property. This would require a switch
from one fuel tank to the other at the
proper time; and, furthermore, such trucks
would not have a power take-off arrangement."
Opinion No. o-2381 held that in these situations the
refund should be allowed if the fuel was shown to have been
used for operating and propelling the registered truck in
question upon private property and not upon and along highways
of this State. As indicated in the above opinion and the
courts generally, where there is an ambiguity the question should
be decided in favor of the taxpayer.
Section 1 of Article 10.14 clearly provides for the
refund of taxes paid on fuel which has been used or sold for
use for any purpose other than propelling a motor vehicle upon
the public highways of this State or which has been sold to the
United States Government for the exclusive use of said govern-
ment.
Section 3 of Article 10.14 reads, in part, as follows:
"Any dealer or user who shall file
claim for refund of the tax on any
special fuel which has been delivered
into the fuel supply tank of a motor
vehicle. . .shall forfeit his right to
the entire amount of the refund claim
filed."
It seems that there is some conflict between the
wording of Section 1 and that of Section 3 above mentioned.
However, the statutes throughout show the intention of the
Legislature to levy a tax on motor fuels and special fuels
used or sold for the purpose of propelling motor vehicles
over the highways; only on that part of the fuel used for
propelling such motor vehicles on the highways of this State.
It is the further intent of the Legislature to refund the tax
on fuels used for purposes other than that of propelling motor
vehicles over the highways of this State, if it can be deter-
mined what amount of the fuel was used for the different pur-
poses.
It is our opinion that Section 3 has reference to
fuels delivered into the fuel supply tank of a motor vehicle
which travels part time on the highways and part time on private
property with no way of determining the amount of fuel used on
private property and the amount used on the highways.
Honorable Robert S. Calvert, Page 6 (Opinion No. W-1019)
However, in the fact situation given by y’outhe re-
fund is authorized because in this specific situation the fuel
is not delivered into the fuel tank which supplies fuel to the
motor while traveling on the public highways. The fuel on which
the refund is asked is delivered into a separate tank which is
used only for operating the motor at a time when it is not pro-
pelling the vehicles over the public highways but is being used
to propel a power take-off shaft to operate a stationary pump
for loading or unloading the cargo of the truck.
To demonstrate this more clearly -- if this were a
separate motor mounted on the rear-end of this truck so that
it could not be used for propelling the truck and the fuel was
supplied from a separate tank as in this case clearly in our
opinion the refund should be allowed for the fuel used in this
separate motor.
In the instant case the fuel is used out of one tank
to supply the motor while it is being propelled over the public
roads. Then the truck is parked on private property~and the
motor is disengaged from the gears which propel the truck, and
is engaged in another gear which propels the power take-off
shaft to the stationary pump, and the fuel is supplied from a
different tank than that used to propel the motor vehicle over
the roads. In effect, it becomes a completely separate unit
from the motor vehicle which is used on the public roads.
Based on the facts which you have submitted, it is
the opinion of this department that the special fuel used to
operate this motor for the use of loading or unloading the
cargo of the truck, which fuel is being supplled from a tank
which is used only while the truck is standing still and not
being used on the public roads, is not subject to tax or the
tax is subject to be refunded and Article 10.14(3), V.C.S.,
does not preclude you from refunding the tax paid on such
special fuels. The Special Fuels Tax Act authorizes you to
require such affidavits or other information which you deem
necessary to establish that the facts in this situation are
as have been stated.
SUMMARY
The Corntroller is not precluded ,by
Article 10.1E (3), V.C.S., from refunding
the tax paid on special fuels delivered by a
licensed user into a separate fuel tank
connected to and feeding the carburetor of
!
Honorable Robert S. Calvert, Page 7 (Opinion No. WW-1019)
a motor vehicle when the flow line connecting
said tank and carburetor is temporarily cut off
by a valve pending use of such special fuels
to operate stationary pumping units.
Yours very truly,
WILL WILSON
Attorney General of Texas
JHB:jp
APPROVED:
OPINION COMMITTEE:
W. V. Geppert, Chairman
J. Arthur Sandlin
W. E. Allen
Elmer McVey
W. Ray Scruggs
REVIEWED FOR THE ATTORNEY GENERAL
By: Morgan Nesbitt