
    371 F. 2d 442
    S. M. JONES v. THE UNITED STATES S. M. JONES & COMPANY, INC. v. THE UNITED STATES
    No. 43-61
    No. 44-61
    [Decided January 20, 1967.
    Plaintiffs’ motion for rehearing denied May 12, 1967]
    
      
      Raymond F. Garrity, attorney of record, for plaintiffs. Carl A. Phillipps and Garrity, Ferguson and Phillipps, of counsel.
    
      Know Bemis, with whom was Assistant Attorney General Mitchell Rogovin, for defendant. Lyle M. Turner and Philip R. Miller, of counsel.
    Before CoweN, Ohief Judge, Laramore, Dureee, Davis and ColliNS, Judges.
    
   Laramore, Judge,

delivered the opinion of the court:

We are here presented with some novel questions relating to the excise tax on the transportation of property. Sections 3475(a) and 4271(a) of the Internal Eevenue Codes of 1939 and 1954, respectively, impose a 3-percent tax “upon the amount paid within or without the United States for the transportation of property by * * * motor vehicle.” This tax is to be paid “by the person making the payment subject to the tax;” however, it is to be collected and returns are to be filed by the person who receives the payment. Int. Rev. Code of 1939, § 3475(c); Int. Rev. Code of 1954, §§ 4271(d), 4291. The key issue here is whether a shipper can be held liable for this tax on many shipments made over a 16-year period when it is apparent that the truckers have either never filed returns or specifically collected the tax. Subsidiary to this are questions of the proper burden of proof, the applicable statute of. limitations, the application of the tax to icing and unloading service charges, and the propriety of adding interest to plaintiff’s deficiency.

The plaintiff in No. 43-61 is Mr. S. M. Jones, suing in his individual capacity; the plaintiff in No. 44-61 is S. M. Jones & Co., Inc., suing in its corporate capacity. The corporate plaintiff became successor to the individual plaintiff’s business in March 1957, so for the period before us, 1942 to 1958, Mr. Jones’ claim for ref mid comprehends the period from 1942 through March 1957, and the corporation’s comprehends the remainder. The actions have been consolidated, and in the interest of simplicity we shall refer to one plaintiff.

Plaintiff was in the farm produce business with farms in New Bern, North Carolina and Canal Point, Florida. From these locations he shipped most of his fresh produce to- the wholesale markets in trucks owned and operated by small, independent proprietors. In Florida, plaintiff relied on brokers to supply truckers for his transportation requirements. The fee for this service ranged from 5 to 7 percent of the freight charge, and was absorbed by the trucker; i.e., plaintiff paid the broker the full freight charge and the broker turned over 93 percent to the trucker. In North Carolina, however, plaintiff generally contacted truckers directly without consulting a broker. In these instances, plaintiff paid the trucker the full freight charge and the trucker was spared any commission. Arrangements with truckers, particularly in North Carolina where they dealt directly with plaintiff, were typically informal. Thus plaintiff frequently advanced individual truckers amounts to cover the costs of icing en route, unloading, and even gasoline and other foreseeable transportation expenses. Such advances were subsequently deducted from the final payments which were made upon receipt of signed bills of lading evidencing delivery to the consignee and signed receipts showing, payment for icing, unloading, and other compensable services. Freight rates were similarly left to informal arrangement, however, the practice with rare exception was to- pay the “going rate,” whether to the broker or the directly-hired trucker. That this was a satisfactory arrangement for all concerned is reflected by the fact that many truckers never discussed rates on the assumption that plaintiff would pay the same to all. Where brokers were involved, the arrangements were more businesslike; plaintiff received invoices which carefully itemized all charges. It is beyond dispute that plaintiff’s payments of freight charges, excluding charges for icing and unloading, were subject to the 3-percent tax.

During a 1958 audit of the excise tax accounts of several truckers who regularly transported produce for plaintiff, an Internal Revenue Service Agent learned that these truckers had either not been collecting the excise tax from plaintiff or paying it over to the government. Rather than proceed against these and other truckers, however, the agent decided to center investigation on plaintiff. This was understandable in view of the fact that in two years of the period in question, plaintiff dealt with 165 different truckers. Reconstruction of the facts was extremely difficult, and we shall limit ourselves here to a summary of the accounting problems and their resolution. For the quarterly periods ending December 31, 1912 through December 31, 1946, the agent relied on the cash journal for information on the tax. He found that before June 1946, plaintiff’s bookkeeper periodically marked some freight paid figures with the letter “T”. He concluded that this indicated that the tax had been paid in those designated transactions. He also found that the bookkeeper had created an account entitled “reserve tax on freight,” and by extrapolation from the 3-percent tax factor and the freight charges not marked with a “T”, concluded that this was a reserve for the transportation tax. Further examination proved that this reserve was never reduced by payments of the tax, but was eliminated altogether in 1953 when it was added to net worth. The second step in the agent’s reconstruction of the unpaid tax was an examination of the cash journal, duplicate check copies, and North Carolina office records to determine what truckers apparently never specifically collected the tax from plaintiff. In step three, the agent assumed that those truckers who apparently did not collect the tax from 1942 through 1946 and from 1956 through 1958 did not collect it from 1941 through 1954, and therefore concluded that the tax was still due in the amount of three percent of the total freight disbursements (apparently including icing and unloading charges) made to such truckers. For 1955, the agent overcame the problem of missing records by estimating a probable unpaid tax on the freight payment figure reported in the individual plaintiff’s income tax return. In the case of Mr. Jones, the agent computed a deficiency of $48,571.35 for the period from December 1, 1942 through March 31, 1957. The figure for the corporation was $5,633.95 for the period from March 31, 1957 through September 30, 1958. These amounts were paid to defendant, plus interest of $23,791.84 for Mr. Jones, and $556.28 for the corporation, in September 1959.

Subsequently, plaintiff had A. M. Pullen & Co., a firm of certified public accountants, reconstruct the freight figures for most of the period in issue. Their report covers all but the period from December 1, 1942 through December 31, 1945, the omission being a result of incomplete records. The parties in pretrial proceedings agreed that this report was a valid reconstruction and stipulated that the transportation tax was paid by plaintiff at least to the extent that the Pullen report concluded. We note that for the period from 1946 through the first two quarters of 1958 the report shows total freight charges of $2,041,321.08, or $2,137,349.58, if icing and unloading charges are included. Neither the parties nor our Commissioner appear to have drawn any specific inferences from this, but we think it is instructive to apply a 3-percent tax to the freight charge computations and compare it with the tax definitely paid. For the “freight-only” total the tax would be $61,239.63; it becomes $64,120.49 by adding icing and unloading charges. This compares with $14,931.03, the agreed upon minimum tax-paid figure. Assuming that the minimum tax-paid figure is also the maximum (as the Internal Eevenue Service agent would), the inference is that there was a deficiency of $46,308.60 using the “freight-only” total as a tax base, or $49,189.46 using the freight plus icing and unloading charge. Of course, this “deficiency” would have to be augmented by some unknown amount for the period from December 1, 1942 through December 31, 1945 which is not covered by the Pullen report. Very likely a reconstruction of those three years would show a total “deficiency” of at least $10,000. Whatever the correct figure might be, it is significant to note that the Pullen report with some addition produces a “deficiency” of roughly $60,000 (using either a “freight-only” tax base or freight plus icing and unloading) which is close to the $54,205.30 computed by the Internal Revenue Service agent and paid by plaintiff. We think it is fair to say that if the agent correctly concluded that the truckers neither collected nor paid the reconstructed deficiency and that plaintiff was liable, the deficiency plaintiff was required to pay was reasonable. In fact, by agreeing to the Pullen report findings, it seems that plaintiff implicitly accepts the reasonableness of the agent’s calculations, except the inclusion of the icing and unloading charges in the tax base.

I. Statute of Limitations

The threshold legal issue concerns the application of the statute of limitations. Plaintiff asserts that the bulk of his claim made in his individual capacity should be granted because assessment of the deficiencies was barred by the 4-year provision of the 1939 Code and the 3-year provision of the 1954 Code. Int. Rev. Code of 1939, § 3312; Treas. Regs. 113, § 143.51; Int. Rev. Code of 1954, § 6501. Plaintiff does not deny that both limitations provisions impose no time bar where returns are not filed, nor does he deny that some of the truckers never filed returns. His argument is that the truckers presumptively carried out their statutory duties of collecting the tax and filing returns and that the defendant has not been able to rebut this presumption. Allied to this is plaintiff’s notion that the truckers were absorbing the tax as part of the freight rate (and presumptively filing returns) wherever it was not specifically paid by plaintiff and collected and returned by a trucker. We understand the sole question, as framed by the parties, to be whether returns were actually or constructively filed. We conclude here, as we do in detail on the merits, that if there is a presumption that the truckers performed their statutory duties, the defendant has rebutted it. Once rebutted, it is as though there were no presumption and plaintiff has not persuaded us that returns were filed, either as a matter of fact or law. Since it is conceded that the statute of limitations does not run if a return is not filed, the defendant was not barred from assessing the deficiencies.

II. Taxability of Freight Charges

On the merits, plaintiff attempts to avoid the ordinary tax case burden of proof by arguing there should be a presumption that the truckers collected and paid the taxes. This is supposed to follow from two different aspects of the tax scheme, the first being that as a matter of policy (or perhaps logic) it should be presumed that the addressees of a statute will perform the duties it requires of them. See e.g., Bank of the United States v. Dandridge, 12 Wheat. (25 U.S.) 64 (1827); Athens Roller Mills, Inc. v. Commissioner, 136 F. 2d 125 (6th Cir.1943). In setting up the transportation tax scheme, Congress placed the duty of collection and filing returns on truckers; it would certainly be reasonable to assume in theory, at least, that most truckers would comply with the statute, if for no other reason than to avoid penalties. The second aspect favoring a presumption is the fact that the government should be in a better position to produce evidence showing whether the truckers as its “collecting agents” did or did not absorb the tax or collect it and pay it over to the Internal Revenue Service. On its theory then, plaintiff should recover unless defendant rebuts the presumption, and even in that event, plaintiff might still be able to carry what would be a burden of persuasion. We offer no opinion on the theory that the presumption is needed and a departure from the normal burden of proof warranted, because in our view any presumption there might be has been rebutted.

Our Commissioner found: “[Mr. Jones’] assumption that the truckers who were not collecting the tax as such were absorbing it was (to the extent that such assumption was actually made, as hereinafter indicated) a reasonable assumption.” “Thereinafter,” the Commissioner “indicated” the evidence warranted the conclusion that Jones “actually and reasonably made the assumption during the earlier years of the imposition of the tax; but * * * that his insistence upon it in later years reflects more of a rationalization than an actual state of mind.” More specifically, the Commissioner noted that Jones “was well aware of the fact” that the small, independent truckers he dealt with were not reliable tax collectors, and in the later years became aware of the further fact that those truckers who did not ask for the tax, either at the time of billing or later, were not making returns or paying the tax. Since defendant in its answer concedes it is the law that plaintiff’s tax liability would be discharged if he in fact paid the tax to the truckers, whether specifically or by absorption, these findings require close scrutiny. At first glance, it appears that on either a presumption or ordinary burden of proof analysis the Commissioner concluded that Jones established at a fact that he thought he had discharged his liability to some extent. This is undermined by the parenthetical comment — i.e., “(to the extent that such assumption was actually made * * *),” and by the findings relating to the later years. Normally, we would be reluctant to look behind such a finding as it involves matters of demeanor and credibility, but to determine just how we should read all the findings to resolve possible inconsistencies, we have made an independent examination of the transcript.

After looking at Jones’ and the truckers’ testimony, we find that if it was reasonable for Jones to assume the truckers were absorbing the tax, it was reasonable only as a matter of bare logic or rationalization. Jones said the following on direct examination: * * if he [the trucker] failed to collect it [the tax] at any time, even the time the freight was due or at a later date, then we assumed or understood that he was absorbing the tax, for the reason we knew the tax was payable, the tax was collectible by the trucker and the trucker was required to remit to the Treasury Department the tax, there was nothing else we could assume or v/nder-stand from these actions.” (Emphasis added.) It seems to us that “these actions” lead to another assumption which is that the truckers were not paying the tax either because they did not know about it or because they thought they could “get away” with not paying it. However, we are not willing to attribute to Jones such an assumption, with the attendant inference that he wilfully participated in the evasion, because the Commissioner who observed his demeanor did not conclude this nor did the defendant impeach Jones’ testimony on cross-examination. So we are left with the task of explaining how Jones could have “reasonably” assumed the tax was absorbed, yet still be liable for the tax. This can be done by differentiating between Jones’ subjective views and an objective analysis of the facts. Subjectively, Jones may have deduced the tax was being absorbed by the fact that the truckers, who presumably knew of their collection duties, did not ask for payment. Put differently, Jones may have thought that he was being shrewd in not specifically mentioning the tax to the truckers and was thereby passing the tax on to them. Objectively, however, Jones’ unilateral assumption was not so “reasonable” as to permit the conclusion that there was the meeting of minds necessary for a finding that the truckers were absorbing the tax under the shipping contracts. See Darn v. Wiseman, 94 Ga. App. 216, 94 S.E. 2d 65 (Ct. App. Ga. 1956).

The facts upon which we base the above conclusion and the conclusion that defendant successfully rebutted any presumption are developed primarily through the testimony of plaintiff, his assistant bookkeeper, and seven truckers. It is quite clear to us that the truckers had no intention of paying the tax unless it was turned over to them and itemized at the time of payment of the freight charges. It seems that the “scuttlebut,” as denominated by one trucker, was that there was no duty to pay the tax if the check did not specify it. One trucker testified without objection that plaintiff’s accountant said that he would always pay the tax on request. Indeed this was the practice, as Jones conceded in his testimony. Plaintiff’s assistant bookkeeper testified that it was his understanding the tax had not been paid where the check failed to show a tax item. He also explained the reserve, which was used in the early years and “funded” in the exact amount of the unpaid tax, as a contingent liability account established in recognition of the possibility that truckers might have to be paid the tax in the future. Plaintiff, himself, made no effort in his testimony to cast this evidence in any special light; he simply focused on trying to prove the inconsistent fact that he assumed the tax was being absorbed.

It should be noted that there are some facts, albeit few, in plaintiff’s favor. Thus it is true that most, if not all of the truckers, who did not collect the tax were carriers for the North Carolina farm. Brokers were not used in North Carolina so the truckers saved brokerage commissions which were usually more than double the tax. It does not follow from this, however, that the truckers absorbed the tax; it simply shows that they could have. It is also a fact that many excise taxes, and particularly sales taxes, are absorbed in the price of goods and services without notice to the purchasers. But this does not mean that the practice for the transportation tax is or should be the same. In short, the weight of the evidence leaves no doubt that the tax was neither being absorbed nor paid. The testimony of the seven truckers, coupled with the other evidence in the case, is enough to rebut any presumption. To use a professorial analogy, the defendant has returned the ball to plaintiff’s court, and he has not countered by persuading us that the evidence, stripped of any presumption, entitles him to recover.

III. Icing and Unloading Charges

It appears from the facts, and the government seems to agree, that the Internal Revenue Service agent used total freight charges, i.e., the unit charge based on weight and miles plus icing and unloading costs, as the tax base. Plaintiff recognizes that section 143.1(d) of Treasury Regulations 113 defines “transportation” (the tax is imposed on the amount paid for “transportation”) as including icing and unloading as “accessorial services furnished in connection with a transportation movement.” Plaintiff also recognizes that in Armour & Company v. United States, 144 Ct. Cl. 697, 169 F. Supp. 521, cert. denied, 361 U.S. 821 (1959), this court overruled Swift & Company v. United States, 136 Ct. Cl. 394, 144 F. Supp. 956 (1956), and Armour & Company v. United States, 141 Ct. Cl. 566, 159 F. Supp. 380 (1958), and followed Beber v. United States, 167 F. Supp. 169 (N.D. Calif. 1958), whch held that under the “re-enactment doctrine” the regulations defining “transportation” were valid so that charges for icing and salting performed by carriers should be included in the tax base. He argues the present case may be distinguished by the fact that his icing and unloading payments were simply reimbursements to the truckers for services rendered by persons not “engaged in the business of transporting property for hire.” Support for this position, especially as to the icing charges, is given by the Commissioner’s findings that the icing and unloading services “were rendered by persons unidentified with the carriers (truckers) except insofar as the carriers selected and paid the icing stations and the laborers who unloaded or helped to unload,” and that in selecting the icing stations, “the truckers were not rendering services as independent contractor carriers, but were acting as interim agents of plaintiffs.” The Commissioner concluded the truckers were acting as independent contractors as to the selection of laborers for unloading, however. We agree with defendant that plaintiff has not shown a sufficient distinction to escape the application of the second Armovrr case.

The tax is imposed on “amounts paid [for transportation] to a person engaged in the business of transporting property for hire,” and plaintiff clearly paid the charges to the carriers. It is true the carriers did not physically perform the services, but they were responsible for seeing that the produce was iced en route and unloaded at the destination. This being the case, it seems to us the icing and unloading services were part of the truckers’ job of transporting the produce. Plaintiff is really asking us to view the arrangement as one in which the icing stations and unloaders were working for him. He assumes the railroads in the prior cases used their own icing stations, but we are not certain that was always the case or that it would have made any difference. In our view, nothing is served by characterizing the truckers as “interim agents” for purposes of icing services. We doubt an analysis that makes the carrier the agent of the shipper for limited purposes can play any useful role here because it builds into the statute even more anomalies than already exist. The effect of this decision is to tax payments made to carriers for the actual cost of moving the cargo plus the costs of preserving it and unloading it where the carrier supervises all activities. If a shipper moves cargo himself and ices it and unloads it himself, there will be no tax because there is no payment to “a person engaged in the business of transporting property for hire.” In the in-between case, there might be a taxable payment to a carrier for the moving, but non-taxable payments to icing stations or unloaders if they bill the shipper directly. This may seem artificial, but we think it is preferable to an agency analysis which would require us to draw lines between small and large carriers. In other words, we are not prepared to say that in this case the truckers were agents for the special purpose of icing, yet in some other case involving larger carriers which have their own icing facilities, they are not agents and the icing is therefore part of “transportation.”

The unloading charges are still more clearly “transportation” under the Armour test. We agree with our Commissioner that the truckers acted completely independently in hiring laborers for this purpose and that this service was part of the transportation process. It is true the truckers were reimbursed for the unloading charges as for the icing charges and this might suggest that the truckers were simply accommodating plaintiff. We thought this was not a correct characterization of the icing charge situation; our identical conclusion as to the unloading charges is bolstered by the additional fact that plaintiff customarily paid the truckers only one-half the unloading fee. Certainly the other half which was absorbed became part of the charge for moving the produce. We are unwilling to make the truckers schizophrenic agents.

IV. The Propriety of Interest

There remains the question of interest. Plaintiff recognizes that the transportation tax regulations provide: “all taxes are due and payable * * * without assessment * * * or notice * * *,” and if not so paid, “there shall be added, as part of the tax, interest at * * * 6 peicent * * *.” Treas. Reg. 118, § 143.54. He argues this general rule is inapplicable, however, because “[i]nsofar as [he] knew, [he was] paying [his] admitted tax liabilities, either as such or by way of absorption thereof by the truckers, and it was through no fault on [his] part that the Government waited some sixteen years in the matter before pursuing it.” We are also asked to analogize the present case to Rev. Rul. 58-300, 1958-1 Cum. Bull. 454, which held that a taxpayer who refuses to pay his tax to the person whose duty it is to collect it cannot be required to pay a delinquent filing penalty under section 6651 of the 1954 Code because such a taxpayer has no duty to file a return. Plaintiff’s theory is that if a taxpayer who refuses to pay is spared the penalty, then the taxpayer who not only had no duty to file a return but also never refused to pay the tax should be spared interest “which is in the nature of a penalty.” The logical extension of such a theory is that interest should apply only to parties responsible for collecting the tax. This argument is inadequate in two respects. Firstly, interest is not a penalty but a charge for the use of money, and the government unquestionably was deprived of the use of these taxes before assessment. Secondly, the facts here are other than plaintiff has alleged. We concluded earlier that objectively plaintiff should have known he was not paying his “admitted tax liabilities.” It is indeed unfortunate, and perhaps inexcusable, that the government waited 16 years to assess the tax, but this can provide no amnesty from the requirement of compensating the government for use of money which plaintiff knew it should have had.

In summary, we hold that plaintiff was liable for the transportation tax assessed in 1959, that the assessment was not time-barred under plaintiff’s theory that returns were presumptively filed, that the tax base properly included the icing and unloading charges, and that the assessment properly included interest. Accordingly, the petitions are dismissed.

FINDINGS OF FACT

The court, having considered the evidence, the report of Trial Commissioner W. Ney Evans, and the briefs and argument of counsel, makes findings of fact as follows:

Findings of Fact

1. (a) These cases are suits to recover amounts representing excise taxes on the transportation of property which were assessed against the plaintiffs and subsequently paid under protest, with interest, pursuant to notices from the Internal Kevenue Service, one of which contained the following:

Important Notice

According to our records, the above account for which a statement of tax due was sent to you is still unpaid. Unless you have already paid this account, or make immediate payment, we will take action to enforce collection. Such action may result in levy on your property, receivables, bank accounts, salary, wages, commissions or other income as a means of collecting your unpaid account. * * *

(b) The cases were consolidated for trial. At pretrial the parties agreed, with the approval of the commissioner, that trial should be limited in the first instance to issues of fact and law relating to the right of plaintiffs to recover, reserving determination of the amount of recovery, if any, for further proceedings.

(c) The taxes were imposed by section 3475 of the Internal Eevenue Code of 1939 and by section 4271 of the Internal Revenue Code of 1954, which, two sections, according to a stipulation by the parties, “during the periods here involved * * * provided as follows

(1) For the imposition of a tax of 3% upon the amount paid for the transportation of property.
(2) The tax was payable by the person making the taxable payment and was collectible by the person receiving such payment.
(3) The person receiving any taxable payment for the transportation of property was liable for the collection of the tax from the person making such payment at the time the payment was made.
(4) The person who collected the tax attributable to the payment for transportation of property was required to file an appropriate return with the local District Office of the Internal Revenue Service.
(5) If the person collecting the tax on the taxable payment failed to remit the amount to the Internal Revenue Service he became personally liable therefor.

(d) Treasury (IRS) Regulations 113, issued February 1, 1943, relating to the tax on the transportation of property, provided (1) that every person receiving any taxable payment for the transportation of property “must collect the tax from the person making such payment at the time the payment is made”; (2) that every person required to collect the tax “must keep accurate records * * * for at least four years from the date the tax is due * * and “must make returns * * * under oath, for each calendar month * * which were to be filed “together with the amount of the tax”; and (3) that “all taxes are due and payable * * * without assessment * * * or notice * * *,” and if not so paid, “there shall be added, as part of the tax, interest at * * * 6 per cent * * *.”

2. (a) During much of the period here involved (1942-1957), the individual plaintiff, S. M. Jones, operated a sole proprietorship business under the firm name of S. M. Jones & Company (hereinafter the Company) which was engaged in growing, buying, and selling farm produce at two places of business, one in New Bern, North Carolina, the other at Canal Point, Florida.

(b) The corporate plaintiff, S. M. Jones & Company, Inc. (hereinafter the Corporation), was organized under Florida law in March 1957 to take over the business of the Company, and thereafter maintained its principal place of business at Canal Point, Florida, although operations in North Carolina were continued. The individual plaintiff become president of the Corporation and served in that capacity during the time here involved after March 1957.

(c) First the Company and then the Corporation paid amounts for the transportation of property in intrastate and interstate commerce, within the meaning of the relevant tax statutes, but neither was ever “engaged in the business of transporting property for hire” within the meaning of those statutes.

(d) Plaintiffs’ produce was occasionally transported by rail, or by other large, well-organized transportation companies. Service by such carriers is not involved in these cases, which are concerned instead with transportation by trucks owned and operated as small, independent businesses.

3. (a) The aggregate amount involved in the case of the individual plaintiff is $72,363.19, representing taxes in the amount of $48,571.35 for the period of 14% years from December 1, 1942, through March 31, 1957, and interest thereon in the amount of $23,791.84.

(b) The aggregate amount involved in the case of the corporate plaintiff is $6,190.23, consisting of $5,633.95 in taxes for the six quarterly periods ended June 30, 1957, through September 30,1958, and interest thereon of $556.28.

(c) In both cases the assessments were made on August 14 and 21 and September 2, 1959, while payments of the assessments were made on September 21, 1959. The assessments were made on the basis of reports submitted under dates of March 5, 1959 (in the case of the Company) and March 6, 1959 (in the case of the Corporation) by an Internal Revenue agent.

(d) On or about January 5, 1960, each of the plaintiffs filed valid and timely claims for refund of the aggregate amounts respectively paid by them. These claims were officially denied by the Commissioner of Internal Revenue on October 31, 1960.

4. (a) During the years here involved, plaintiffs’ produce was moved primarily by truck. Transportation services were thus provided by small, independent contractors who were engaged by plaintiffs either by direct contact or through brokers. At the North Carolina base of operations (New Bern) the services of brokers were seldom used, while in Florida (at Canal Point) such services were used almost exclusively.

(b) Truckers supplied by brokers were charged commissions for the brokerage service, ranging from 5 to 7 percent of the freight charge. No commissions were charged to truckers by plaintiffs, regardless of whether the truckers were engaged directly or through brokers.

5. (a) The testimony establishes a distinction, accepted in common usage among shippers and truckers, between the terms “freight rate” and “freight charge.” The “rate” reflected a unit charge, based on weight or miles or both (ton-miles) or packages. The “charge” reflected the amount derived from the application of the “rate” to the number of units.

(b) Freight rates were established on a voluntary basis by agreement between shippers and truckers. Competition among shippers for trucks and among truckers for loads generally brought about more or less uniform rates for the transportation of farm produce, although either the shipper or the trucker was free to bargain for a rate of his own choosing. This situation generally prevailed in both North Carolina (at New Bern) and Florida (at Canal Point).

(c) Plaintiffs generally, within each season, offered and paid going rates to almost all truckers who carried their produce, paying the same rate to truckers engaged through brokers as to truckers engaged directly. Often, in plaintiffs’ transactions with truckers, there would be no discussion of rates, the truckers agreeing to haul on the tacit understanding that they would be paid the same rate plaintiffs were paying to others.

(d) The majority of truckers engaged by plaintiffs did not render invoices for their transportation charges and other costs or expenses. Instead, they surrendered signed bills of lading evidencing delivery of the cargoes to the consignees and receipted bills for other charges such as icing and unloading. Plaintiffs thereupon issued checks covering the transportation and other charges, computing the freight charge by application of the agreed rate schedule to the units involved. The bills of lading used in lieu of invoices did not detail the various charges paid by plaintiffs to the truckers, but the checks issued by plaintiffs did itemize the charges for which payments were made.

(e) In view of the facts (1) that in Florida truckers were obtained largely through brokers, whereas in North Carolina brokers were seldom used, the truckers being engaged directly, and (2) that truck brokers, in the majority of instances, submitted invoices itemizing charges for freight, icing, unloading, and tax, the inference follows that the majority of instances of nonpayment of the tax (with which these cases are concerned) occurred in North Carolina.

6. (a) Where icing of produce was required en route, plaintiffs issued instructions to the truck drivers at the outset of the trips. Pursuant to such instructions, the drivers purchased such additional icing as was needed at independent icing Stations. The icing was done by the station, with the truck driver sometimes assisting; the station was paid by the driver, who obtained a receipt for the outlay; and plaintiffs reimbursed the truckers for their outlays at the same time ’that payment was made of the freight charges.

(b) At some terminals union rules precluded driver participation in the unloading of trucks, whereupon union labor was employed to do the unloading. Such terminals were in the minority, overall. Generally, therefore, the drivers did the unloading, with such assistance as they could obtain or had to obtain at the terminals. In either event, plaintiffs reimbursed the truckers for only half of the charges incurred for unloading, using this carrot-and-stick device to induce the truckers to do the unloading without further cost or at minimum cost to plaintiffs. Such reimbursement was made, on the basis of tickets prepared or receipts obtained by the drivers, at the time payment was made for the transportation.

(c) In numerous instances, plaintiffs made advances to the truckers to cover costs of icing (en route), unloading, and sometimes for gasoline and other expenses, and charged the advances to the truckers’ accounts in the settlement of their bills.

(d) Plaintiffs, truckers, and brokers all regarded the expenses for icing and unloading as reimbursable items of expense incurred on behalf of plaintiffs, separate and apart from the “freight charge” or transportation cost.

(e) The services provided to plaintiffs’ cargoes for icing (en route) and unloading (at destination) were rendered by persons unidentified with the carriers (truckers) except insofar as the carriers selected and paid the icing stations and the laborers who unloaded or helped to unload.

7. (a) As heretofore noted, the period of time involved in these cases extends from December 1, 1942, to September 30, 1958, a total of 15 years and 10 months. The Internal Eevenue agent on whose reports the assessments were computed based his work almost wholly upon records kept by the plaintiffs. His work was begun in July 1958.

(b) For the 3-year (plus) period from December 1, 1942, through December 31, 1945, the only available records of the Company were (and are) its cash journals, wherein were recorded the gross amounts paid for freight, without breakdowns to show payments for icing, unloading, and tax (except as hereinafter noted), separate from freight. Subsidiary records either did not exist or were incomplete.

(c) For the remaining 11 years and 3 months of the Company (from January 1, 1946, through March 31, 1957), the books and records of the Company were (and are) intact, and consist of (1) journals combining cash receipts and disbursements; (2) duplicate copies of checks issued; and (3) “pouches” (files), each containing papers involving a single transaction, such as bills of lading, invoices, and ice tickets.

(d) The books and records of the Corporation were and are intact for the entire period of its involvement (from April 1, 1957, through July 31, 1958), and consist of the same elements as described in the preceding paragraph.

8. (a) The occasion for the revenue agent’s audit of plaintiffs’ accounts was information furnished him by several truckers (who were themselves being examined as to why they had failed either to file excise tax returns, or to pay over the tax collected, or to collect the tax) that they had been unable to collect the tax from plaintiffs.

(b) For quarterly periods ending on December 31, 1942, through December 31, 1946, the agent examined the cash journal of the Company and made the following findings, among others:

(1) Throughout two of the cash journals the letter “T” had been inserted from time to time after the amount of freight paid.

(2) At the end of the Company’s 1943 tax year, the bookkeeper (since deceased) had debited the freight account in the amount of $822.17 and had entered a credit in the same amount to an account entitled “reserve tax on freight.”

(3) In arriving at the amount of $822.17, the bookkeeper had added the disbursements actually made during 1943 to those truckers whose amounts were not symbolized by the letter “T” and had multiplied the total by 3 percent. The product was $822.17.

(4) At the end of 1944, the bookkeeper had debited an account entitled “reserve-deprec. of freight” in the amount of $572.30, and had credited the same account (identified simply by ditto marks) in the same amount.

(5) In arriving at the amount of $572.30, the bookkeeper had again added the disbursements made during 1944 to those truckers whose amounts were not symbolized by the letter “T” and applied the factor of 3 percent to arrive at the product of $572.30.

(6) In the general ledger the $572.30 of 1944 had been added to the $822.17 of 1943 to credit an account entitled “reserve tax on freight” with a total of $1,394.47.

(c) The parties have agreed (1) that the nature of the credit account entitled “reserve tax on freight” as found in the Company’s cash journal, general ledger, and balance sheets was that of a contingent liability account; and (2) that it was the sort of account that would be set up to recognize the fact that it might be necessary to pay the stated amounts to the truckers in the future.

(d) At the end of the tax year 1953, the balance of $1,394.47 in the account entitled “reserve tax on freight” was eliminated by increasing the book amount of the individual plaintiff’s investment in the sole proprietorship.

(e) On the basis of his examination, the revenue agent reasonably concluded (1) that the symbol “T” after an amount disbursed to a trucker for freight meant that the tax had been included in that payment and (2) that the “reservo tax on freight,” begun in 1943 (and eliminated in 1953) reflected transportation tax accrued but not paid during the period the symbol was in use.

9. (a) For the period 1956-1958, the revenue agent examined the cash journal and duplicate check copies, and made spot checks of the pouches relating to transactions originating in New Bern, North Carolina. He listed the truckers who had apparently not collected the tax and made a comparison with the similar listing he had made for 1942-1946, and made his determination of tax liability accordingly.

(b) For the period January 1, 1947, through December 31, 1954, the agent again examined the cash journal and determined the tax liability on the assumption that those truckers who had apparently not collected the tax in 1942-1946 and those who apparently had not collected the tax in 1956-1958 had likewise not collected the tax in 1947-1954. On the basis of this assumption the tax liability was determined by the application of 3 percent to the total freight disbursements made to those truckers who appeared not to have collected the tax.

(c) Records for the year 1955 were not available to the agent to the same extent as for other years after 1945. He therefore computed an estimate of the tax liability on the basis of the freight payments reported on the Federal income tax of the individual plaintiff for that year.

10. (a) On July 11, 1963, A. M. Pullen & Company, certified public accountants, submitted to plaintiffs their reports (one for the Company; one for the Corporation) reflecting the results of examinations of the books and records for the period January 1, 1946, through July 31, 1958, in terms of payments (separately stated) of freight and transportation tax. The accountants made no report for the period December 1, 1942, through December 31, 1945, “because the subsidiary records are incomplete for this period.”

(b) The parties, in their statement of agreed facts, filed at pretrial, have stipulated numerous facts and figures, using in several instances figures assembled by counsel from the data submitted with the Pullen Reports. Foremost among these agreements are the figures set forth in Table 1, which is incorporated herein by reference.

(c) The parties have further stipulated that the transportation tas has been paid at least to the extent that the Pullen Reports show that a tax has been paid, such amounts being (1) $10,237.72 (by the Company, for the years 1946 through 1956 and the first quarter of 1957); and (2) $4,693.33 (by the Corporation, for the last three quarters of 1957 and the first two quarters of 1958) ; (3) for a total of $14,931.05.

,11. (a) The parties have also agreed that “[t]he * * * books and records of the plaintiffs show that the number of different truckers dealt with by them were as follows for the periods indicated

(b) Since it appears from Table 1 that the combined total of freight charges paid during the same period was $2,041,321.08, an average of $1,275.50 per trucker is indicated. On the other hand, 55 pouches in evidence reflect an average freight charge per transaction, of $252.68. Using this average as against the total freight charge would indicate 8,078 separate transactions or, in terms of truckers, an average of 5.3 hauls per trucker or, in terms of years, 646 hauls per year.

12. (a) The parties have stipulated:

(1) That in many instances where invoices were rendered by the truckers, the tax and other charges were shown as separate items on the freight bill and were included in the amount then paid by plaintiffs, although in numerous other instances the tax and other charges were not shown as separate items [on such invoices].

(2) That in 31 instances (both where freight bills were rendered and where only receipted bills of lading were submitted) , the freight was paid by one check and the tax by another check; and that this occurred in 18 instances on the same day and, in other instances, days, weeks, months, and in one instance, a year separated the issuance of separate checks.

(3) That in eight other instances specifically cited, the tax on previous freight charges was picked up in a later payment for freight and tax then currently due.

(4) That although the symbol “T” does not appear in the cash journal for 1946 in connection with some of the checks (hereinafter mentioned), a tax as such was paid at the time of issuance of 16 (listed) checks.

(5) That in two instances the letter “T” appears opposite entries in the cash journal for 1946, although no tax as such was paid by either of the checks.

(b) The parties have further stipulated:

(1) That no Federal excise tax returns for the transportation of property tax which would have been filed in North Carolina or South Carolina by the truckers who served the Company are presently available for periods prior to January 1,1957.

(2) That no Federal excise tax returns for the transportation of property tax which would have been filed in Florida by the truckers who served the Company are presently available for periods prior to January 1,1956.

(3) That no Federal excise tax returns for the transportation of property tax which would have been filed in Virginia by the truckers who served the Company are presently available for periods prior to January 1, 1953.

(4) That what returns are available in the said districts for periods subsequent to January 1,1953, do not, except in a few instances, disclose from whom the truckers collected or failed to collect, the transportation of property tax.

(5) That no attempt was ever made by the revenue agent to assess or collect, or to recommend to his superiors that there be assessed and collected, from any of the truckers serving the plaintiffs, the deficiencies in transportation tax determined by the agent and assessed against plaintiffs.

13. (a) Never, at any time, did the plaintiffs or either of them (1) fail or refuse to pay to a carrier (trucker) the charge for transporting property from one point in the United States to another; (2) refuse to pay or protest the payment of the transportation tax to the carrier receiving the payment for freight; (3) discourage or attempt to discourage any trucker from collecting the tax; or (4) issue instructions to any of their employees (i) not to pay the tax, (ii) to discourage truckers from collecting the tax, or (iii) to select or otherwise favor truckers who had theretofore failed to request payment of the tax.

(b) Truckers who billed plaintiffs for the tax, or otherwise requested payment of it, were paid the tax promptly and without question, at the time payment was made of the freight charge.

(c) Truckers who billed plaintiffs, or otherwise requested payment for the freight charge in the first instance, and who later returned to request the payment of the tax, were paid the tax irrespective of the time lapse since the payment of the freight charge.

14. (a) Mr. S. M. Jones testified: “we assumed or understood that he [the trucker] was absorbing the tax, for the reason we knew the tax was payable, the tax was collectible by the trucker and the trucker was required to remit to the Treasury Department the tax, there was nothing else we could assume or understand from these actions.”

(b) In an effort to prove tbat this was a reasonable assumption, plaintiffs offered evidence to show they were rarely ever required to pay the North Carolina retail sales tax to the suppliers of farm equipment and the automobile dealers from whom they purchased, from which fact they assumed that the suppliers and dealers were absorbing (and paying) the tax, just as plaintiffs did in the operation of a small general store which they ran at Hubucken, North Carolina, for the sale of gasoline, fuel, oils and boat supplies, marine hardware, and some food and clothing items.

(c) In addition, plaintiffs urge the evidence shows absorption would have been financially feasible. Referring to the instances cited in finding 12(a) (2), where the freight was paid by one check and the tar by another, 24 of the 31 checks in payment of taxes were in amounts less than $10, for an average per check of $7.04. Based upon a 3 percent charge, the average freight bill so reflected was $234.66. The absorption of $7.04 out of $234.66 would not have been an unreasonable burden, particularly to a trucker who figured he was saving from $11.73 to $16.42 in brokerage commission through direct engagement by the shipper.

15. (a) Concerning the extent to which the assumption of absorption of the tax was actually made, the evidence as a whole warrants the following conclusions: (1) Subjectively, Mr. S. M. Jones may have reasoned at some time (most likely in the earlier years of the imposition of the tax) that the tax was being absorbed because the truckers, who presumably knew of their collection duties, did not ask for payment. Perhaps he thought he was being shrewd by not specifically mentioning the tax to the truckers and that he was thereby passing the tax on to them. (2) However, objectively, Mr. S. M. Jones’ unilateral assumption was not so “reasonable” as to permit the conclusion that the truckers were absorbing the tax under the shipping arrangements. (3) For the later years, when he must have known that at least some truckers were not paying the tax (apart from the question of whether they had collected it), his insistence that he made the assumption reflects more of a rationalization than an actual state of mind.

(b) Mr. Jones was well aware of the fact that the small, independent truck operators upon whom he relied for transportation services are notoriously averse to the keeping of records, particularly if they have to make them. It must be inferred that, when the transportation tax was first imposed, he seriously questioned the feasibility of using such operators as tax collectors. He paid the tax to those who requested it and set aside a reserve with which to pay those who had not requested it, waiting to see if and when their duties as tax collectors would be taken seriously by them. Within 5 years the maintenance of the reserve was discontinued; and after 10 years (following the demise of his longtime head bookkeeper), the reserve itself was eliminated through transfer of the amount to his net worth.

(c) With the passing of time, Mr. Jones became fully aware of the further facts (1) that these same small, independent truck operators knew that if the tax was not separately itemized in plaintiffs’ checks, the tax was not being paid to them; (2) that those truckers who were not asking (billing) for the tax as such were not making returns for or payment of the tax; and (3) that such men variously rationalized their indifference as simply as out of sight out of mind.

16. (a) Bearing in mind the distinction between the payment of the tax on the premises for which plaintiffs contend and the payment of the tax “as such” (i.e., payment of specifically itemized tax computations on specific charges for freight), the tax “as such” had not (prior to the payments by plaintiffs of the assessments at issue in these cases) been paid in the majority of instances.

(b) The exact amount of unpaid tax as such (as defined in the preceding paragraph) has not been determined; nor can it be determined without the application to plaintiffs’ records of assumptions and rationalizations similar to those used by the revenue agent.

CONCLUSION OF LAW

Upon the foregoing findings of fact, which are made a part of the judgment herein, the court concludes as a matter of law that the plaintiffs are not entitled to recover and the petitions, therefore, are dismissed. 
      
       26 U.S.C. § 3475(a) (1952 Ed.).
     
      
       26 U.S.C. § 4271(a) (1952 Ed. Supp. II), repealed June 30, 1958, 72 Stat. 260.
     
      
       The actual period is December 1, 1942 through September 30, 1958, 15 years and 10 months.
     
      
       For tile purpose of computing brokerage commissions, the “freight charge” aid not Include costs of icing or unloading, or the transportation tax (in those instances when the tax was paid).
     
      
       The assessment date was September 21, 1959, so plaintiff’s theory would entitle him to a refund of all taxes paid with respect to the period before September 21, 1956.
     
      
       The defendant did admit in its initial answer that if plaintiff could prove it had paid the truckers the tax or that the truckers had collected it, he would be free of further liability even though no returns were filed, although it is not clear that this would be the result just as a statute of limitations principle.
     
      
       In his briefs and oral argument, plaintiff made it clear that he was not asking the court to go into conflict with two Sixth Circuit cases holding that failure of the person charged with the duty to collect the tax to file returns keeps the limitations period open both as to the “collector” and the person whose duty it is to pay to the collector. McDonald v. United States, 315 F. 2d 796 (6th Cir.1963) ; Mulette V. United States, 315 F. 2d 826 (6th Cir.1963). See also, Cohan v. United States, 198 F. Supp. 591 (E.D. Mich. 1961).
     
      
       See n. 7, supra.
      
     
      
       It is well established that taxpayers have the burden of proof in tax refund cases.
     
      
       Presumptions are frequently useful -where the probabilities are known. Thus, in recurring: fact situations, it is “common sense” that “the proof of fact A renders the inference of the existence of fact B so probable that it is sensible and time-sawing to assume the truth of fact B until the adversary disproves it.” McCormick, Evidence § 309 (1954). Put differently, “when a designated basic fact or aggregate of facts exists, existence of another fact or aggregate of facts, called the presumed fact or facts, must be assumed in absence of adequate rebuttal.” Maguire, Evidence: Common Sense and Common Law 183 (194.7). In the present case, the basic fact (fact A) would be that the truckers had a legal duty to collect and pay the tax. The presumed fact (fact B) would be that they carried out their duty (because most persons with such legal duties carry them out). Since the basic fact is not disputed, plaintiff argues the presumed fact stands until rebutted. The defendant has introduced considerable evidence to rebut the presumed fact and support a finding of its “non-existence.” “[W]hen such evidence has been introduced, the existence or non-existence of the presumed fact is to be determined exactly as if no presumption had ever been applicable in the action.” Eield and Kaplan, Civil Procedure 536 (1953). See Model Code of Evidence rule 704 (1942).
     
      
       The burden of proof has been analogized to a game of tennis in which the plaintiff as server must first get the ball into the defendant’s court. He does this by having sufficient pleadings (satisfying the pleading burden) and by producing sufficient evidence (satisfying the production burden). If there is a presumption, plaintiff’s production burden is satisfied by producing enough evidence to establish fact A (from which fact B is presumed). Plaintiff has an additional burden, however, and that is to persuade the fact-finder that the evidence establishes the facts necessary for him to recover (satisfying the persuasion burden). In the present case, plaintiff pleaded and produced evidence to support his theory of recovery. His presumption theory further helped him to get the ball into defendant’s court. The defendant produced counter-evidence to rebut any presumption and to persuade the fact-finder that plaintiff’s version of the facts was not correct. This put the burden on plaintiff to counter the defendant’s evidence and return the ball to defendant. Plaintiff has not been able to carry this burden of persuasion. See 9 Wigmore, Evidence § 2487 (3d Ed. 1940) for a diagram which holps to visualize this process. See also n. 10, supra.
      
     
      
       Jurisdiction is conferred by section 1491 of title 28, united States Code. The suits are authorized (1) by section 3772(a) of the Internal Revenue Code of 1939 for the period December 1, 1942, to December 31, 1953; and (2) by section 7422(a) of the Internal Revenue Code of 1954 for the period January 1, 1954, to September 30, 1958.
     
      
       Following are material excerpts from section 3475 of the Internal Revenue Code of 1939 (26 U.S.C. § 3475, 1946 ed.) :
      “§ 3475. Transportation of property — (a) Tax. There shall be imposed upon the amount paid within the united States after the effective date of this section for the transportation * * * of property by rail, motor vehicle, water, or air from one point in the united States to another, a tax equal to 3 per centum of the amount so paid * * *. Such tax shall apply only to amounts paid to a person engaged in the business of transporting property for hire * * *. * * * (b) * * *
      “(c) Returns and payment. The tax imposed by this section shall be paid by the person making the payment subject to the tax. Each person receiving any payment specified in subsection (a) shall collect the amount of the tax imposed from the person making such payment, and shall, on or before the last day of each month, make a return, under oath, for the preceding month, and pay the taxes so collected to the collector ***. * * * (a) * * «
      “(e) Registration. Every person engaged in the business of transporting property for hire * * * shall * * * register his name and his place * * * of business with the collector * * *. Every such person who fails to register within the period specified shall be guilty of a misdemeanor * *
     
      
       Following are material excerpts from section 4271 of the Internal Revenue Code of 1954 (26 U.S.C. § 4271, 1952 ed., Supp. IV, 1957) :
      “§4271. Imposition of tarn, (a.) Property * * *. There is hereby imposed upon the amount paid * * * for the transportation of property * * * by rail, motor vehicle, water, or air from one point in the United States to another, a tax equal to 3 percent of the amount so paid. * * * (b) * * * (c) * * * “(d) By whom paid. The taxes imposed by this section shall be paid by the person mating the payment subject to the tax.”
      In addition to the foregoing, section 4272 of the 1954 Code provided that “[tjhe tax imposed under section 4271 shall apply only to amounts paid to a person engaged in the business of transporting property for hire * * and section 4273 required “[ejvery person engaged in the business of transporting property for hire * * *” to register, but omitted the penalty for failure so to register.
      Sections 4271-4273 of the Internal Revenue Code of 1954 were repealed by the Act of June 30, 1958, 72 Stat. 260, effective August 1, 1958 (as to transportation beginning on or after that date).
     
      
       § 143.50.
     
      
       § 143.51.
     
      
       § 143.52.
     
      
      
         § 143.54.
     
      
       At the time of trial, Mr. Jones was a resident of Florida.
     
      
       Neither did plaintiffs or either of them collect from any person any amount charged for the transportation of property.
     
      
       Nor the purpose of computing brokerage commissions, the “freight charge” did not include costs of icing or unloading, or the transportation tax (in those instances when the tax was paid).
     
      
       Rates charged for such transportation as is here involved were not, at the times material to these actions, regulated by the Interstate Commerce Commission.
     
      
       At one time the rates offered by plaintiffs were lower than the rates paid by other shippers in the area.
     
      
       Exceptions to this customary practice were rare and were limited to restricted types of freight.
     
      
       All of the larger transportation companies and most of the brokers did customarily render invoices, detailing all of the various charges, i.e., so much for freight, so much for icing, so much for unloading, and so much for tax.
     
      
       The icing charges were reflected by receipts which the drivers obtained from the icing stations.
     
      
       The unloading charges were reflected sometimes by tickets made out by the drivers and sometimes by receipts from the person or persons employed to unload the truck.
     
      
       Initial icing was installed at the point of origin. The ice so installed was billed to plaintiffs by the icing station, and payment was made to the station by plaintiffs.
     
      
       The icing stations were selected by the drivers. The station owners and operators did not know (except incidentally) or care who owned either truck or cargo.
     
      
       The helpers did not know (except incidentally) or care who owned either the truck or the cargo.
     
      
       After plaintiffs shifted from a ton-mile rate to a package rate, they discontinued all reimbursements for unloading.
     
      
       Brokers did not include the costs of icing and unloading in the amounts upon which they computed the commissions payable to them by the truckers. Such costs were not considered in the establishment of freight rates, or in the computation of the transportation taxes (when computed or paid).
     
      
       The icing stations were themselves independent contractors, and so were the laborers on the basis of the evidence of record.
     
      
       Finding 3 (a) and (b).
     
      
       Finding 3(c).
     
      
       The agent did not undertake to question every trucker with whom plaintiffs had done business. In connection with his audit of plaintiffs, however, he did send a list of the truckers to the office of the District Director, in Greensboro, North Carolina, to see whether they had filed excise tax returns for the tax on the transportation of property. For many of the truckers the Greensboro office had no record of their ever having filed such returns. Thereafter, the agent did independently audit some of the truckers with whom plaintiffs had done business.
      Many of the truckers engaged by plaintiffs were from states other than North Carolina. The agent did not attempt to determine whether excise tax returns had been filed by such truckers in other states.
     
      
       While the truckers may very well have told the revenue agent that they were unable to collect the tax from plaintiffs, the evidence of record negates their inability to collect the tax. Plaintiffs never refused or even hesitated to pay the tax upon request.
     
      
       There were three cash journals for the period January 1942 through December 1947. One journal covered 1942-43-44; one extended from January 1945 through November 1946; and one covered the 13 months of December 1946 through December 1947.
     
      
       The last “T” notation was made on May 28, 1946.
     
      
       Where the Pullen Reports fail to show that a tax as such was paid on individual transactions, the duplicate check copies also fail to show that a tax as such was paid; likewise, the pouches fail to show that a tax as such was paid in those transactions where the reports fail to show that a tax was paid.
      On the other hand, where the Pullen Reports show that a tax as such was paid on individual transactions, the duplicate check copies also show the same amount of tax as having been paid.
     
      
       Of tie details cited, 24 instances concerned tie Company, extending over tie years 1946-1956, wlile 7 instances concerned tie Corporation.
     
      
       Except for the qualifying adverb “notoriously,” this fact is well supported by the evidence of record.
     
      
       In a few isolated instances, amounts paid to such truckers for tax were subsequently deducted from later payments for freight.
     
      
       Defendant, in its requested findings of fact, reasonably estimates that “[approximately 76 percent of the checks issued to truckers by plaintiffs between January 1, 1946, and July 31, 1958, did not show that any tax was paid.”
     
      
       Plaintiffs do not seriously dispute the fact that substantial amounts of the tax “as such” remained unpaid in the course of operations.
     
      
       The purport of this conclusion is to endorse the approach used by the revenue agent. In this connection, the following conclusions are warranted by the evidence: (1) that the Company paid the tax to the truckers during the period December 1, 1942, through December 31, 1945, in those instances where the symbol “T” appears in the cash journal after the name of the trucker or the amount of the disbursement; (2) that during that period, where the symbol “T” fails to appear, the Company did not pay the tax as such to the truclcer; (3) that during the period January 1, 1946, to March 31, 1957, the Company did pay the tax as such to the truckers in those instances wherein the Pullen Report (to the Company) shows the tax to have been paid; (4) that during the same period, the Company did not pay the tax as such to the truckers in those instances where the Pullen Report fails to show that a tax as such was paid; and (5) that during the period April 1, 1957, to July 31, 1958, the Corporation likewise paid or failed to pay the tax as such, as shown by the Pullen Report (to the Corporation).
     