delivered the opinion of the Court.
This suit was brought by the appellant to recover of the appellee, the Canton Company, a corporation formed under the laws of Maryland and having its principal office in Baltimore City, taxes for the years 1880, 1881, 1882, 1883, on the aggregate valuation of the capital shares of stock of said company as assessed by the State Tax Commissioner and certified by him to the Appeal Tax Court of said city.
The first question arising upon the agreed statement of facts upon which the case was tried is, whether the said company was entitled to have deducted from said valuation of its stock the value of its reversions in fee in certain parcels of land in Baltimore City demised by it to various tenants under leases for ninety-nine years, renewable forever, in the form and mode customary in that city, which leases reserve certain irredeemable ground rents and contain covenants by the lessees to pay all taxes levied or assessed on said parcels of land, and the annual ground rents incident thereto, and all improvements thereon; and which parcels of land and the improvements-thereon have been assessed at their full taxable value, including said reversions in fee to which said ground rents are incident, to the ■lessees thereof or their assigns, who, for the purposes of this suit, are admitted to have paid to the collector of Baltimore City all the taxes thereon for the said years.
*233The second question presented is, assuming that the appellee was entitled originally to have such deduction made, whether it can now set up such a defence under the further facts admitted in the record, to wit: that the President of the Canton Company furnished to the Appeal Tax Court for the years mentioned a true statement of the said reversions in fee in and to said parcels of land and of the ground rents reserved thereon; that said reversions and ground rents were for each of said years valued and assessed by said Appeal Tax Court to the appellee, but no certificates of such valuations and assessments were furnished to its president or other officer, and therefore no certificates of such valuations and assessments were transmitted to the State Tax Commissioner, and none of such valuations and assessments were considered by him in ascertaining the taxable value of the shares of stock of the defendant corporation.
The Act of 1880, chap. 20, amending section 151 of Art. 81 of the Code, as re-enacted by the Act of 1878, chap. 178, provides, that the president or other proper officer of every corporation, formed under the laws of this State or doing business therein, shall furnish a true statement of any real property which it shall own or possess to the County Commissioners or the Appeal Tax Court of Baltimore City, according to the location of said property, and such real property shall be valued and assessed by the said Commissioners or Tax Court, respectively, to the said corporation, and they shall give duplicate certificates of such valuation and assessment to such president or other officer, who shall transmit one of such certificates, with his return of stock, to” the State Tax Commissioner, and taxes shall be paid by such corporation on such assessment in the same manner as the same are levied upon and paid by individual owners of real property in such county or city; and that the Tax Commissioner shall deduct'the assessed value of such real property from the" aggregate *234value of all the shares of stock of such corporation and divide the residuum by the number of the shares of the capital stock, and the quotient shall be the taxable value of such respective shares of stock.
It is contended by the appellee that its reversionary interest in the parcels of land demised by it as aforesaid, to-the extent it has entered into the taxable valuation and assessment of said lands, brings it within the statutory provision just cited, and should have been deducted from the valuation made by the Tax Commissioner of its capital-stock, as being real estate of which it is the owner; and, further, that the taxes upon the full value of said lands having been paid by its lessees, not to deduct the value of such interest from its capital stock would be in effect to subject it to double taxation.
In our construction of the law the appellee is not entitled to be considered an owner of real estate within the contemplation of the Act of Assembly, nor within the proper signification of those words as used in connection with the established tax system of the State.
Those corporations only are to be regarded as owners of real estate, the valuation of which is to be deducted from the valuation of their stock, to whom the land is directly assessable, and who are primarily chargeable with the taxes thereon. It is only when a corporation is thus liable for the taxes on real property that the law relieves its. stock as representative of that property. The relation between the land and the stock must be thus direct. It is not such taxation as may incidentally burden the resources, or reduce the profits of corporations, and incidentally or circuitously affect the market value of their stock for which it is the design or policy of the law to allow an abatement.
Nor is it compatible with public convenience and the prompt collection of revenue, for the State to trace out all the sub-divided or qualified interests that may be held in *235real estate, and seek to hold the various owners responsible. Its policy is to assess the fee simple value of the land to the holder of the possession, where its real owner is not apparent or accessible, leaving the parties interested to adjust the proportions of liability between themselves. This general principle is stated on page 223 of Burroughs on Taxation, as follows :
“It is the fee simple in land that is assessed. The law does not regard the different interests in the assessment. It looks to the person having the present right of enjoyment, whether the tenant for life or years, for the tax on the fee simple value of the land, and such person is the-one to he assessed with the land.”
This policy is recognized in the Act of 1812, chap. 112, sec. 36, and with specific reference to leasehold estates. As incorporated in the Code, Art. 81, sec. 73, Act of 1874, chap. 483, sec. 65, it enacts :
“ The tenant or person holding any leasehold estate, shall pay to the collector the taxes levied on the demised premises, and shall have his action against the landlord for the sum so paid, or may deduct the same out of the rent reserved, unless otherwise agreed between the lessor and lessee.”
By force of this provision, the lessees of the appellee, and not the appellee itself, are the owners of the lands in question for the purposes of taxation ; and it is only taxable owners to which the Act of 1880 must he taken to refer when providing for deductions on account of assessments made against corporations “ owning or possessing real estate.”
On other grounds also we do not think the interest of the appellee, although an element in the taxable valuation of the lands, is such an ownership or possession of real estate as was meant by the Act of 1880, to he deducted from the assessment of its stock.
In the first place, the leases contain covenants by which as part of the consideration of making them, all the taxes *236shall he paid by the lessees. The obligation is thus transferred to them to the relief of the appellee as lessor. It may be that the tenants would have consented to a larger reservation of rent, but for assuming this burden; but this assumption cannot be accepted as a basis for an ascertained valuation of real estate chargeable to the appellee, and to be set off against its stock. The same effect on the amount of rent to be reserved, might be predicated of a covenant to improve, or of any other stipulation of the tenant.
The nature of a landlord’s reversion in land leased for ninety-nine years, renewable forever, with irredeemable ground rents incident thereto, is not, substantially, that of an ordinary owner of land in fee simple, whose holding is ■of that nature, we think, contemplated by the statute of 1880, when speaking of owners of real estate. As said hy this Court in Banks vs. Haskie, 45 Md., 217, in discussing the nature of such a conveyance: “It seems to us quite clear, that the intention was on the part of the lessor to secure the prompt payment in perpetuity of the interest on a sum of money equivalent to the value of the property in fee at the time the lease was made, and on the part of the. lessee to acquire a perpetual interest in the leasehold premises which would justify his making permanent improvements thereon, and enable him to avail 'himself of the value of the property thus enhanced, as well as of its increase in value arising from other causes. * * * * Instead of selling the property in fee for its then value, and investing the proceeds in other securities, {the owner,) resorts to this method of deriving an income from it, and making a secure and permanent investment of its value in the land itself.”
The landlord is not affected by the rise or fall in the value of the fee ; any enhancement in its value enures to the leasehold estate. The ground rent issuing therefrom remains fixed in amount, and the lessor is really interested *237in the subsequent value of the land and the erection of improvements thereon, only as furnishing a sufficient pledge or security for the sum certain to be annually paid to him. The buildings that may be erected do not as in the case of an ordinary owner of the fee merge in it as fixtures to swell the assessment against him, but become an additional element of real and taxable value to the estate of the tenant. The landlord’s interest in the land is but a form of money investment, analogous to that secured by a mortgage. And when a corporation invests money in a mortgage, the exemption of the mortgage debt from taxation does not exempt the shares of stock of the corporation to the extent of such investment. Emory vs. State, 41 Md., 58. Nor is it double taxation to tax the mortgagor on the full value of the land he has mortgaged, and a corporation mortgagee on the full value of its stock, when the mortgage is not exempt, as in the case of Building Association mortgages. Appeal Tax Court vs. Rice, 50 Md., 319. The principles governing taxation in respect of mortgages would, by analogy, seem applicable to the estate or interest óf a landlord in real property under leases of the nature of those made by the appellee.
After full consideration, we are clearly of opinion that the Act of 1880 under which the appellee claims exemption does not contemplate a deduction from the valuation of the capital stock of a corporation, because of its investments in irredeemable ground rents.
But if we had not reached the conclusion just stated, we should question the right of the appellee now to interpose the defence it has set up, in view of the means prescribed by the statute law through which such a defence could have been availed of. The Tax Commissioner is a ministerial officer only in making the abatement from the valuation of its capital stock of the valuation of the real property of a corporation.
He acts solely upon the asseesment of such real property, as made by the County Commissioners or Appeal *238Tax Court, evidenced by their certificate to be furnished the president or other proper officer of the corporation, •and by such officer to be transmitted to him. Provision is also made in the statute for appeal from such assessment by the corporation to a tribunal specially constituted to entertain such appeal. The appellee took no .steps to enforce the delivery of such a certificate, which the statement of facts sets out was not furnished, or to •appeal from the assessment said to have been made ; and the Tax Commissioner in that state of case had no power but to certify to the Appeal Tax Court, the assessed taxable value of its shares of stock as he had ascertained and •affixed it.
(Decided 11th March, 1885.)In accordance with the views we have expressed, the Judgment of the Baltimore City Court must be reversed, and the cause remanded that judgment may be entered in favor of the appellant, for such sum as the tax rate of the years 1880, 1881, 1882, and 1883 respectively, calculated upon the values of the shares of stock of the appellee, as fixed for those years by the State Tax Commissioner, and set forth in the agreed statement of facts, shall amount to.' ¡
Judgment reversed, and cause remanded.