Appeal, No. 87, March T., 1953, from order of Court of Common Pleas of Allegheny County, Jan. T., 1951, No. 2837, in case of Graybar Electric Company, Inc. v. School District of Pittsburgh and James P. Kirk, Treasurer. Order amended and, as amended, affirmed. Appeals by plaintiff from deficiency tax claims. Before ADAMS, J. Adjudication filed finding for defendant tax authorities in part; plaintiff's exceptions sustained in part and final decree entered, before WEISS, ADAMS and DUFF, JJ., opinion by ADAMS, J. Defendants appealed.
Oscar G. Peterson, Assistant Solicitor, with him Mortimer B. Lesher, Solicitor and Niles Anderson, Assistant Solicitor, for appellants.
W. Denning Stewart, for appellee.
Before Stern, C.j., Stearne, Jones, Bell, Musmanno and Arnold, JJ.
OPINION BY MR. JUSTICE JONES
The Act of June 20, 1947, P.L. 745, as re-enacted and amended, 24 PS § 582.1 et seq., provides that, beginning with the year 1948 and annually thereafter, every school district of the first class shall issue mercantile licenses and levy and collect an annual mercantile license tax at the rate of one-half mill on each dollar of the volume of the annual gross business transacted by wholesale vendors and brokers. The School District of the City of Pittsburgh accordingly levied such tax for the year 1948 and for subsequent years and adopted regulations for the administration of the impost. The Graybar Electric Company, a New York corporation, was engaged in business as a wholesale vendor and broker of electrical supplies and equipment and, for such purposes, had an office within the School District of the City of Pittsburgh. Graybar seasonably obtained mercantile licenses, made tax returns and paid taxes on account thereof for the years 1948, 1949 and 1950.
On October 23, 1950, following an examination of Graybar's books, the school district made additional tax claims for the years 1948, 1949 and 1950 and also claimed penalties at the rate of 1% per month and interest at the rate of 1/2% per month from the due
date of each year's tax claim.*fn1 Graybar appealed the additional tax assessment to the Court of Common Pleas of the county, contending that the imposition of the additional taxes was based in part on receipts from interstate commerce transactions, which were not within the taxing power of the school district, and on an improper classification of certain other transactions. The hearing judge dismissed the appeal in respect of the claim concerning receipts from interstate commerce and sustained the appeal in respect of the improper classification. The trial judge held Graybar accountable for interest on the unpaid tax claim from the due date of the tax but, in express reliance on our decision in Fidelity-Philadelphia Trust Company v. Hines, 337 Pa. 48, 10 A.2d 553, relieved the company from the payment of any penalties prior to the date of the court's decree nisi, viz., April 7, 1952. The court en banc sustained the trial judge as to the decision on the merits but relieved Graybar of liability for any penalties or interest on account of the unpaid taxes prior to the date of the final decree, viz., October 29, 1952.
Within the period limited therefor, the school district appealed to this court. In the meantime, the taxpayer had paid the additional taxes, as found by the court below to be due and owing, with interest thereon from the date of the court's final order. Graybar moved to quash the appeal, principally, on the alleged ground that the matter involved was moot. The payment did not, however, constitute an accord and satisfaction of the whole of the school district's claim nor could it have been so intended, as evidenced by the taxpayer's accompanying letter of transmittal. Neither
was the school district, which is a public body, estopped by its receipt of a part of its claim from proceeding with the action for the recovery of the disallowed balance. Not until the time for an appeal from the final order would have expired could the litigation be held to have been concluded. There is no merit ...