Appeal from order of Court of Common Pleas of Dauphin County, No. 656 Commonwealth Docket 1963, in case of Commonwealth of Pennsylvania v. General Foods Corporation.
George W. Keitel, Deputy Attorney General, with him William C. Sennett, Attorney General, for Commonwealth, appellant.
David McNeil Olds, with him Carl E. Glock, Jr., Carl F. Chronister, James H. McConomy, and Reed, Smith, Shaw & McClay, for appellee.
Bell, C. J., Jones, Cohen, Eagen, O'Brien, Roberts and Pomeroy, JJ. Opinion by Mr. Justice Pomeroy. Mr. Justice Eagen concurs in the result. Mr. Justice Roberts dissents. Mr. Justice Cohen took no part in the decision of this case.
This is a second appeal by the Commonwealth of Pennsylvania (Commonwealth) with respect to the Pennsylvania franchise tax of General Foods Corporation (taxpayer) for its fiscal year ended March 31, 1960. Initially, the Court of Common Pleas of Dauphin County, in its opinion and order dated September 19, 1966 (followed by a final decree entered on January 20, 1967), sustained the taxpayer's appeal. The Commonwealth then appealed to this Court; and in our opinion of March 15, 1968, reported at 429 Pa. 266,
A.2d 359, we vacated the lower court's order and remanded the case for further proceedings.
The remand was ordered because the court below had not complied with the statutory mandate that there be specific findings of fact and conclusions of law in the event of appeal, thus making it impossible for us to determine the basis for its order. Subsequently, upon return of the record to the lower court, the court entered (1) a supplement to its original opinion making the necessary findings and conclusions, (2) an order again sustaining taxpayer's appeal, and (3) a judgment for the correct amount of tax found to be due the Commonwealth. Both parties filed certain exceptions which the court below then disposed of in an opinion and final order dated March 16, 1970. From this order the Commonwealth has again appealed.
The record before us is essentially the same as that presented in the earlier appeal; it is supplemented, however, by the opinions of the lower court following our remand and the parties' exceptions to the findings and conclusions of the lower court. The evidence presented consists of several groups of items: (1) the formal appeal and specification of objections; (2) a stipulation of facts containing 95 paragraphs and covering 46 pages of the printed record; (3) exhibits to the stipulation of facts broken down into 43 categories and covering 334 pages of the printed record; and (4) testimonial evidence presented by three witnesses for the Commonwealth and four witnesses for the taxpayer with exhibits from both sides. All the facts relate, of course, to the tax year in question. From the findings of fact based on this evidence, the following appears.
Taxpayer is a national food manufacturing, processing and distributing concern incorporated under the laws of the State of Delaware and having its principal headquarters in White Plains, New York. It has been
qualified as a foreign corporation to do business in Pennsylvania since 1943. Taxpayer is organized into seven operating divisions by types of product, each having its own sales responsibilities, and a Distribution-Sales Service Division performing services for all of the product divisions. In order to manage its operations it has divided the country into four regions, each of which is further divided into ...