Appeals, Nos. 82, 83, 84 and 86, March T., 1953, from decrees of Court of Common Pleas of Allegheny County, Jan. T., 1951, Nos. 2021 and 2022, in cases of Keystone Metal Company v. City of Pittsburgh and James P. Kirk, Treasurer, and Same v. School District of Pittsburgh and James P. Kirk, Treasurer. Decrees, as modified, affirmed.
Lee W. Eckels, with him William D. Sutton, Henry D. Morrow, and Thorp, Reed & Armstrong, for plaintiff.
J. F. McKenna, Jr., First Assistant City Solicitor, with him Anne X. Alpern, City Solicitor, and David Stahl, Assistant City Solicitor, for City of Pittsburgh.
Oscar G. Peterson, Assistant Solicitor, with him Mortimer B. Lesher, Solicitor, and Niles Anderson, Assistant Solicitor, for School District.
J. Wray Connolly, W. S. Moorhead, Jr., and Moorhead & Knox, filed a brief for The Wieman & Ward Co., amicus curiae.
Before Stern, C.j., Stearne, Jones, Chidsey, Musmanno and Arnold, JJ.
OPINION BY MR. CHIEF JUSTICE HORACE STERN
The question in appeals Nos. 82 and 83 is whether sales of copper scrap by a Pittsburgh seller to a Pittsburgh buyer are transactions properly includable as gross receipts under the Mercantile License Taxes of the City of Pittsburgh and the School District of Pittsburgh, in view of the fact that the subject matter of the transactions never came into Pennsylvania but was delivered directly from out-of-State suppliers to an independent refinery in another State for processing.
Pursuant to the power given in the Act of June 25, 1947, P.L. 1145, the City of Pittsburgh enacted an ordinance imposing an annual mercantile license tax of one mill on the taxpayer's gross volume of business, computed on the gross receipts of the preceding year. The School District, in accordance with the Act of June 20, 1947, P.L. 745, by resolution levied a similar tax of one-half mill.
Appellant, Keystone Metal Company, (hereinafter called Keystone) is a Pennsylvania corporation having
a place of business in Pittsburgh and is engaged in the business of buying, selling and dealing in non-ferrous metals. During the first month in which it operated it sold huge quantities of copper scrap to Westinghouse Electric Corporation (hereinafter called Westinghouse) and National Electric Products Corporation (hereinafter called National), both of which are Pennsylvania corporations with offices in Pittsburgh. All of these sales were consummated in the following manner: Purchase orders were placed with Keystone by Westinghouse and National specifying the quantity of scrap desired, and with a provision that it was to be shipped by Keystone directly to a smelting and refining company in Carteret, New Jersey; this latter company was not affiliated with either the seller or the buyers. Since Keystone did not itself keep any copper scrap on hand, it was obliged, in order to fill the orders, to buy the scrap from suppliers in Pennsylvania and other States. These suppliers shipped the scrap -- 58 carloads -- directly to the refinery in New Jersey. Keystone received from Westinghouse and National the sum of $826,961.03 in payment for the scrap. The mercantile license tax ordinance and resolution provided that where, as here, the taxpayer had not been in business during the entire year preceding that for which the tax was imposed, the volume of business on which the tax was to be computed should be twelve times the volume transacted in the taxpayer's first month of business. Accordingly, the City Treasurer claimed ...