concurring in part and dissenting in part.
I concur with the result reached by the majority denying recovery to the appellant on its claims for rebates of excise taxes relating to., the 10 percent payments (or credits) which appellant allowed or paid to its dealers in connection with its GMC Heavy-Duty Program and its Chevrolet Heavy-Duty Program, and relating to the allowances appellant made to its dealers as a part of its Chevrolet Passenger Car Program and its Chevrolet Light-Duty Program, and its GMC Light-Duty Program, and with its affirmance of the United States Claims Court judgment denying recovery on such claims. However, I do not agree with some of the reasoning set forth in the majority opinion.
I respectfully dissent as to that part of the majority opinion that allows the appellant a rebate of taxes in connection with the IV2 percent allowance paid by appellant to its dealers in connection with its GMC Heavy-Duty Truck Program and its Chevrolet Heavy-Duty Truck Program, and which, to that extent, reverses the judgment of the Claims Court.
At the outset, I point out that by an en banc decision of this court in South Corporation v. United States, 690 F.2d 1368 (Fed. Cir.1982), we are required to follow the decisions of our predecessor court, the United States Court of Claims. That court has established by at least two en banc decisions certain tests and guidelines for the determination of when and under what circumstances a rebate for excise taxes will be allowed to a manufacturer for payments or allowances made by it to its dealers in connection with the sale of its products. In General Motors Corporation, Frigidaire Division, v. United States, 149 Ct.Cl. 749, 277 F.2d 929 (Ct.Cl.1960), the court held that a rebate will be allowed to a manufacturer for reimbursements or allowances made to its dealers for “local advertising” paid for by the dealers. The court reaffirmed this holding in General Telephone & Electronics Corporation v. United States, 176 Ct.Cl. 904, 364 F.2d 853 (Ct.Cl.1966), and in the same case held that rebates by a manufacturer to its dealers for “promotional expenses” are not allowable, as these are properly the expenses of the manufacturer in promoting its products.
Thus, in these cases, the Court of Claims laid down two tests or guidelines to be used to determine if a rebate is allowable, namely, whether an allowance to a dealer is in payment for local advertising by the dealer, and, if so, the rebate is allowed, and whether the allowance is for promotional expenses, and, if so, the rebate is not allowed.
When these tests and guidelines are used in the instant case, it is clear that the only way the appellant would be entitled to a rebate for the IV2 percent allowance it made to its dealers in connection with its two heavy-duty truck programs would be to show that the allowance was in payment of “local advertising” of the dealers. An examination of the items making up- the allowances indicates conclusively that this cannot be done. These items, as described in the majority opinion, were miscellaneous expenses of the dealer in preparing a truck for demonstration, including “mounting special equipment, repairs, maintenance, gasoline, licensing fees, and insurance.” There is no way that these items could be classified as “local advertising” expenses of the dealer. Consequently, the test and requirement set forth by the Court of Claims in the above cases has not been met, and the claim of appellant for the IV2 percent rebate for such allowance should be denied.
*1485Furthermore, the IV2 percent allowance was no different than the 10 percent allowance made by the manufacturer to its dealers where a rebate was not allowed. Both allowances were part and parcel of the same promotional programs and should be treated the same way. The promotional test enunciated by the Court of Claims has been met, and, therefore, rebates for both the IV2 percent and the 10 percent allowance should be denied.
A more serious aspect of the majority opinion in the instant case is presented by its failure to follow the decisions of the Court of Claims in the General Motors and General Telephone cases cited above. In this regard, the majority opinion ignores the “local advertising” and “promotional expenses” tests and guidelines set forth in those opinions that are to be used to determine whether a rebate will be allowed to a manufacturer for a credit or payment to its dealers in connection with the sale of its products. Instead of following these mandates of the Court of Claims, as it is required to do, the majority proposes and applies a new and different test to determine whether a rebate will be allowed. This new test is “control”. In this regard, the majority opinion states:
Accordingly, we conclude that the element of control is decisive in determining whether ... the programs were predominantly within the realm of the manufacturer or predominantly within the realm of the dealers.
The majority then says, in total disregard of the tests prescribed in the Court of Claims decisions, that if the dealers control the program the manufacturer is entitled to a rebate, but if the manufacturer controls the program, the rebate is not allowed.
Using this new control test, the majority then proceeds to hold that the dealers were in control of the two IV2 percent heavy-duty truck programs covering miscellaneous expenses of the dealers (none of which were local advertising expenses of the dealers), and, therefore, the manufacturer is entitled to a rebate for paying such expenses. This is a prime example of how a manufacturer can be allowed a rebate under the control test when it could never receive such a rebate under the local advertising test required by the decisions of the Court of Claims. Furthermore, under the control test, it is possible that a manufacturer could place any kind of program — even one that is promotional — under the control of its dealers and thereby receive a rebate of taxes for payments to its dealers. This would completely circumvent the decisions of the Court of Claims, and would deprive the government of huge sums of excise taxes.
The reliance .of the majority on the word “control” used by the Court of Claims in discussing the collateral and ancillary issue of whether salesmen of a dealer were employees of the manufacturer in General Motors Corporation v. United States, 168 Ct.Cl. 301, 339 F.2d 648 (Ct.Cl.1964) is misplaced. In that case the manufacturer reduced the price of 1954 model Pontiac automobiles by $75.00 to induce its dealers to buy them before the 1955 models were issued. The IRS allowed the $75.00 as a genuine rebate or discount. The manufacturer also paid its dealers an additional $25.00 in repayment of the same amount the dealers had paid their salesmen as an incentive to sell the 1954 models. The IRS denied this $25.00, contending that under these circumstances the salesmen were employees of the manufacturers. The Court of Claims held otherwise, saying:
We are, however, unable to accept the basic premise that the salesmen became plaintiff’s employees. There was no element of control or right to control by plaintiff over the dealer’s salesmen present. Plaintiff had no right to hire and fire, no right of supervision, withheld no taxes, and did not pay the salaries. Further, there is no indication that either plaintiff or the salesmen believed plaintiff to be the employer. A determination ■ that plaintiff was the employer of the salesmen for the purpose of the $25 payment would lack reality. (Emphasis supplied.) 329 F.2d at 652.
There is no other reference in the opinion to “control” or “right to control”. The above *1486reference to these words was directed to the master and servant relationship, vel non, of the manufacturer and the dealers’ salesmen, and had nothing to do with a test for an allowance of a rebate or discount for excise tax purposes. There is no indication in the opinion that the court intended to establish the word “control” thus used on a collateral issue as a test for the allowance of a rebate.
Furthermore, the court did not use control to decide that case on the merits. The decision of the court is reflected in the following paragraphs:
As we have shown, the $25 payments were such a necessary and integral part of the plan, and the two payments were so closely interrelated, that it was erroneous for the Commissioner not to also designate the $25 portions as rebates or discounts. The plan embodied a single method of accomplishment, i.e., to allow a rebate or discount. The components were two-fold, i.e., the $75 payments and the $25 payments. In determining whether the plan was a rebate or discount, the Commissioner should not have separated the components. 339 F.2d at 651.
We have here a pure rebate or discount. The Commissioner of Internal Revenue even conceded that it was a rebate or discount to the extent of the $75 payments. We have merely held that he was in error when he attempted to separate and disallow the other necessary component of the plan. This is a far cry from determining whether or not advertising expenses may constitute a rebate or discount.... (Emphasis supplied.) 339 F.2d at 653.
The subsequent payments by dealers to salesmen were part of the overall plan of rebate or discount. As we previously stated, both the $25 and $75 were necessary for the success of the plan. They cannot, therefore, be separated. 339 F.2d at 654.
The above excerpts from the court’s opinion show without question that the case was decided on the sole basis that the $25.00 payments were a part and parcel of a “pure rebate or discount” plan, and that “control” had nothing to do with it.
In my opinion, the majority has taken the word “control” out of context in the general comments of the court on the ancillary issue of whether the salesmen were employees of the manufacturer, and is using it to set up a new and different test to determine whether a rebate will be allowed. This is contrary to the cited cases of the Court of Claims.
It appears that by adopting the control test to the exclusion of the tests prescribed by the Court of Claims, the majority has, either expressly or by implication, overruled the above cited en banc decisions of that court. This is beyond the authority of our panel.
Finally, Trial Judge Merow has written an excellent opinion, which has been approved by the judgment of the Claims Court. I would affirm that judgment in all respects and deny the appellant a recovery on all of its claims for rebates.