dissenting: So far as the record shows there are deficiencies in tax due the United States from the Oswego Falls Pulp & Paper Company for the years 1917 to 1921, inclusive. The prevailing opinion holds that the deficiencies due for the years 1917 to 1920, inclusive, are barred by the statute of • limitations, first, upon the ground that the petitioner is not a transferee of the assets of that company, and, second, upon the ground that if it were the transferee the deficiencies are barred by reason of the fact that the petitioner had no power to file a waiver which would extend the time for making an assessment against the transferor. I think the opinion is in error upon both points.
Clearly, on and after the consummation of the act of consolidation the Oswego Falls Pulp & Paper Company had no assets from which the respondent could collect the deficiencies due from it. Those assets had by operation of law been transferred to the petitioner. Section 10 of the Act of Consolidation specifically provides that all the properties of the consolidating corporations “ shall be taken and deemed to be transferred to and vested in such new corporation, without further act or deed.” How, in the light of such language, can it be maintained that the new corporation is not the transferee of the assets of the constituent corporations?
Section 280 of the Revenue Act of 1926 was enacted to enable the respondent to proceed in a summary manner against the transferee of the assets of a taxpayer where the taxpayer had, without consideration, parted with its assets. See A. H. Graves et al., 12 B. T. A. 124; Phillips v. Commissioner, 283 U. S. 589, footnote 4. That section did not impose new liabilities upon the transferees of property, although it recognized the fact that in many cases the transferee had a liability for the taxes of the transferor at law as well as in equity. In Phillips v. Commissioner, supra, it was stated:
Section 280 (a) (1) provides the United States with a new remedy for enforcing the existing “liability, at law or in equity.” The quoted words *78are employed in the statute to describe the kind of liability to which the new remedy is to be applied and to define the extent of such liability. The obligation to be enforced is the liability for the tax. * * *
What possible difference can it make in the proceeding at bar that under the New York statute the respondent could have proceeded directly against the petitioner for the taxes owed by the Oswego Falls Pulp & Paper Co.? Does this fact make it impossible for the respondent to proceed under section 280 of the Revenue Act of 1926? I think not. In my opinion the construction placed upon section 280 in the prevailing opinion frustrates the very purpose that Congress had in mind in enacting the section. I can not subscribe to the reasoning in the majority opinion by which this petitioner is exempted from the deficiencies.
In the prevailing opinion the case of Seaboard Air Line Ry. v. United States, 256 U. S. 656, is cited for the proposition “ that the passage of title to a claim from a component corporation to the consolidated corporation as the result of consolidation pursuant to statute was not a transfer or assignment thereof.” I think that that case does not stand for the proposition stated. In that case the appellant sued in the Court of Claims to recover balances for transportation services originally payable to the Florida Central & Peninsular Railroad Company, to whose rights it had succeeded through merger or consolidation. The Court of Claims held that it could not prosecute the claim by reason of section 3477 of the Revised Statutes which prohibit “All transfers and assignments made of any claim upon the United States, or of any part or share thereof, or interest therein.” In its opinion the court stated:
We cannot believe tlmt Congress intended to discourage, hinder or obstruct the orderly merger or consolidation of corporations as the various States might' authorize for the public interest. There is no probability that the United States could suffer injury in respect of outstanding claims from such union of interests and certainly the result would not be more deleterious than would follow their passing to heirs, devisees, assignees in bankruptcy, or receivers, all of which changes of ownership have been declared without the ambit of the statute. * * *
The court simply held that it was not the intention of Congress by section 3477 to cover transfers of claims against the United States of that nature. The court did not hold that there was no transfer of the claim from the constituent corporation to the new corporation.
It is further said in the prevailing opinion that if the petitioner be held to be a transferee, the waiver given by it on behalf of the Oswego Falls Pulp & Paper Company on November 19, 1925, is invalid. I can not subscribe to that view. Under section 9 of the Consolidation Act of the State of New York the new corporation, the *79petitioner herein, enjoyed the “ rights, franchises and privileges possessed by each of the corporations so consolidated * * * and may prosecute or carry on any kind of business which each of the consolidating corporations was authorized by law to conduct.” How can it be contended in the light of such language that a waiver given by it to save itself from the immediate necessity of paying the tax is not a valid waiver? Substantially the question here presented was before the Court of Appeals for the Fifth Circuit in Lucas v. Hunt, 45 Fed. (2d) 781. The facts in that case were that upon dissolution a taxpayer corporation was by statute continued in existence and the management of its affairs entrusted to a liquidator for a period of three years to wind up its business. A waiver extending the time for making assessment of income and excess-profits taxes was executed after the expiration of the three-year period allowed for winding up its affairs. Without the waiver the Commissioner in the performance of his duty would have made assessment within the statutory period and circumstances show that the Commissioner relied upon the waiver. The court stated:
* * * We are of opinion that Hunt by signing the waiver estopped himself to question its validity, with the result that he was bound to respond to the assessment to the extent of funds in his hands which belonged to the dissolved corporation taxpayer. * * *
It should be noted that the question before the court there was whether a transferree could file a waiver which would have any binding effect upon the transferor.
The case of Phillips v. Howe Films Co., 33 Fed. (2d) 891, is on all fours with the proceeding at bar. In that case it was held that where a corporation formed by merger bore the name of one of the merging companies and had the same officers, directors, and by-laws as the two constituent merging companies, and the number of shares in the merged company was the same as the number in the merging companies, the stockholders of the merged corporation had the right to file a statutory waiver of limitation on assessments in behalf of the merging corporation for the purpose of procuring a refund of taxes wrongfully collected from the merging corporation. In other words, it was held that the waiver that was executed by the new corporation which had come into existence upon the consolidation or merger of the constituent companies under the Pennsylvania law was a valid waiver.
In the proceeding at bar the waiver was given by the petitioner corporation to stave off the assessment, which, undoubtedly, would otherwise have been made against the Oswego Falls Pulp & Paper Company. Can the respondent be held at fault for relying upon the waiver? Is the United States to be deprived of its taxes by reason *80of the fact that the respondent, acting in good faith, relied upon such waiver? To me, the case seems to admit of no doubt that the deficiencies are legally collectible from the petitioner as a transferee.
Sea well agrees with this dissent.