Appeal from the Order of the Court of Common Pleas of Allegheny County in case of Genuine Motor Parts of Pa., Inc., a corporation v. The City of Pittsburgh, a municipal corporation; School District for the City of Pittsburgh; and Joseph L. Cosetti, Treasurer, No. S.A. 495 of 1976.
Edward Goldberg, with him George H. Hoffman, for appellant.
Grace S. Harris, Executive Assistant Solicitor, with her Mead Mulvihill, Jr., Solicitor, City of Pittsburgh; Justin M. Johnson, Solicitor, Ronald F. Talarico, Assistant Solicitor, School District of Pittsburgh, for appellees.
Judges Crumlish, Jr., Mencer and Rogers, sitting as a panel of three. Opinion by Judge Rogers.
[ 43 Pa. Commw. Page 435]
Genuine Motor Parts of Pa., Inc. has appealed from an order of the Court of Common Pleas of Allegheny County upholding the assessment against it of City of Pittsburgh and School District of Pittsburgh mercantile license taxes and City business privilege taxes for the years 1971 through 1975, with penalty and interest.
The taxpayer is a Pennsylvania corporation which sells automotive and industrial parts and rebuilds and reconditions internal combustion engines and other heavy equipment. The City's business privilege tax and its mercantile license tax are imposed by ordinances on the authority given by The Local Tax Enabling Act, Act of December 31, 1965, P.L. 1257, as amended, 53 P.S. § 6901 et seq. The School District's mercantile license tax is by authorization of the Act of June 20, 1947, P.L. 745, as amended, 24 P.S. § 582.1 et seq. After hearing, the City Treasurer upheld the several assessments and the taxpayer filed a timely statutory appeal to the court below.
The taxpayer first asserts that the court below erred in deciding that it, the taxpayer, was not engaged
[ 43 Pa. Commw. Page 436]
in manufacturing as that term is used -- but not defined -- in The Local Tax Enabling Act and that the court therefore incorrectly held that its engine rebuilding operations were subject to the City's taxes. In Golden Triangle Broadcasting, Inc. v. City of Pittsburgh, 31 Pa. Commonwealth Ct. 547, 377 A.2d 839 (1977), we held that in the absence of a statutory definition of the term manufacturing, the case law definition applies. In essence, case law defines manufacturing as such application of labor and skill to an article as to cause it to undergo a substantial change in form, qualities and adaptability and to become a new, different and useful article.
We have recently decided that tangible personal property used in operations materially identical to those engaged in by the appellant in its business of rebuilding engines were not used in manufacturing as that term is defined by the Tax Reform Code of 1971 (Code), Act of March 4, 1971, P.L. 6, as amended, 72 P.S. § 7101 et seq. Beckwith Machinery Company v. Commonwealth, 35 Pa. Commonwealth Ct. 138, 385 A.2d 605 (1978). Section 201 of the Tax Reform Code, 72 P.S. § 7201, defines manufacture as:
The performance of manufacturing, fabricating, compounding, processing or other operations, engaged in as a business, which place any personal property in a form, composition or character different from that in which it is acquired whether for sale or use by the manufacturer. . . .
Since the case law and Tax Reform Code definitions of manufacturing are materially identical, Beckwith, supra, is controlling authority in favor of the City's position that the taxpayer's engine ...