Appeal, No. 306, Jan. T., 1959, from judgment of Superior Court, Oct. T., 1959, No. 1, reversing order of Court of Common Pleas No. 1 of Philadelphia County, Sept. T., 1957, No. 2122, in case of City of Philadelphia, Tax Review Board v. Norton, Lilly & Co. Judgment affirmed; reargument refused January 25, 1960. Same case in Superior Court: 189 Pa. Super. Ct. 91. Appeal by taxpayer from decision of tax review board denying petitions for review of mercantile license tax assessment. Order entered dismissing exceptions and affirming decision of board, before GRIFFITHS and CHUDOFF, JJ., opinion by GRIFFITHS, J. Defendant appealed to Superior Court, which reversed order, opinion by WATKINS, J. Appeal to Supreme Court allowed.
Alan Miles Ruben, Deputy to the City Solicitor, with him James L.J. Pie and Leonard B. Rosenthal, Assistant City Solicitors, and David Berger, City Solicitor, for City of Philadelphia, appellant.
George M. Brodhead, with him John F. Kennedy, J. Welles Henderson, and Rawle & Henderson, for appellee.
Before Jones, C.j., Bell, Musmanno, Jones, Cohen, Bok and Mcbride, JJ.
OPINION BY MR. JUSTICE BOK
The Philadelphia Tax Review Board upheld the City's attempt to assess its Mercantile License Tax against respondent for the years 1953 through 1956. The Court of Common Pleas affirmed, but the Superior Court held that the tax lay upon interstate and foreign commerce, and reversed. We have accepted the case on allocatur.
It is agreed that the tax is an excise tax on gross receipts.
Respondent is a partnership none of whose eight members lives in Philadelphia. It acts as general steamship agent for eight lines that sail in foreign commerce. It has an office in the City, with fourteen
to eighteen employes who are paid from its main office in New York City. It has a bank account and a telephone listing in Philadelphia but no other assets than its office equipment. What it does as agent for the lines is best described by its witness Peters: "Q. You say you are engaged by these steamship lines, you have an agreement with them of some kind? A. Yes. Q. In general, that agreement provides for what? A. Normally to get the ship in as quick as we can, to load it and arrange for all the necessary services and get it out again. Q. Will you break that up into specific things you do in order to accomplish that, in the first place the steamship company notifies you a particular ship is coming into Philadelphia at a particular time? A. We know when the vessel sails from Calcutta. Q. Do they tell you about how much cargo there is? A. Yes, and by the time the ship gets here, we have the papers before that. ... We would get a radio twenty-four hours before the ship arrives. We would know when the ship gets to the mouth of the river and then we arrange for the pilot to go aboard, we have made arrangements for the berthing and we arrange for the stevedores to load and unload, we tell the stevedores what the capacity, what hatches to work in and how many hours and where the cargo is stored. Q. Do you actually employ the stevedore company ...? A. The steamship lines have contracts with stevedoring concerns, contracts of employment, not we. Q. What you do is notify the various persons who have contracts with the steamship lines that a certain vessel ... is coming and tell them what is involved? A. That's correct, and in principal how to perform their operations. Q. In other words, it is your responsibility to indicate what they should do to have the vessel unloaded within the time and in proper fashion? A. Yes, that's correct. ... Q. You supervise ... from the office? A. That's right. Q. What do you do? A. Tell
them in what hatches to place the cargo, time to be in at work, for instance, at eight o'clock and if there is overtime. Q. Who do you tell that to? A. The stevedoring ...