
    The People of the State of New York ex rel. The F. P. Bhumgara Company, Respondent, v. James L. Wells, President, and Others, as Commissioners of Taxes and Assessments, Constituting the Board of Taxes and Assessments of the City of New York, Appellants.
    
      Taxation of corporations — the assessors cannot disregard an unimpeached verified statement filed hy the corporation — certiorari to review an assessment — where the return raises an issue of fact, testimony must he taken — what return does not raise an issue of fact.
    
    Where a corporation, assessed for .the purposes of taxation by the commissioners of taxes and assessments of the city of New York, applies for a reduction of its assessment and files with the tax commissioners a verified statement showing its financial condition, if the commissioners are not satisfied with such statement, they may require further information from the corporation; if, however, they neglect to do so, they may not disregard the statement simply because' they believe, without any other grounds for such belief than their mere surmise, that it is untrue.
    
      Where an issue of fact is raised by the petition for, and the return to, a writ of certiorari obtained by the corporation to review the action of the commissioners in refusing to reduce the amount of the assessment to the sum shown by the statement, it is the duty of the court to take testimony upon such issue or send the matter to a referee for that purpose.
    Where, however, the return denies that the assessment is illegal, erroneous or unequal, but does not deny the facts set forth in the petition, such denials are mere conclusions which do not raise any issue of fact, and the Special Term may properly grant a reduction of the assessment and need not take or direct the taking of testimony.
    Van Brunt, P. J., dissented.
    Appeal by the defendants, James L. Wells, president, and others, as commissioners of taxes and assessments, constituting the board of taxes and assessments of the city of Hew York, from an order of the Supreme Coúrt, made at the Hew York Special Term and entered in the office of the clerk of the county of Hew York on the 26th day of January, 1904, reducing an assessment upon the relator’s personal property and denying the defendants’ motion that testimony be taken.
    
      George S. Coleman, for the appellants.
    
      Henry W. Rudd, for the respondent.
   McLaughlin, J. :

An assessment of $60,000 was imposed upon the relator’s property for the year 1902. After the same had been made, and while the assessment books were open for ^correction, the relator applied for a reduction thereof and filed with the tax commissioners a verified statement showing its financial condition for the purposes of taxation for the year named. According to this statement its gross assets were $52,456.73, of which $17,579.53 consisted of “ imported merchandise in original packages in bonded warehouse ” and its indebtedness, $33,915.67. Upon this statement, the truth of which so far as appears was then unquestioned by the tax commissioners, the relator’s assessment was reduced from $60,000 to $18,540, the latter figure being reached by deducting'the indebtedness as shown by the statement from the gross assets. Ho deduction, however, was made for the imported merchandise in original packages in bonded warehouse amounting to $17,579.53. Thereafter the relator, claiming to have been aggrieved by the assessment, inasmuch as the value of the imported merchandise was not deducted, upon a petition setting out the foregoing facts, obtained a writ of certiorari to review the proceedings of the commissioners. In the return to the writ the commissioners alleged that the imported merchandise in. original packages was not deducted because the verified statement Was filed by the relator “only .two business days before the tax-, books closed under the provisions of the Greater Hew York Charter, and under the press of business at that time we were unable to verify the statements so' made by the relator or ascertain the details with regard to its assets and liabilities. The statement did not disclose what portion of such accounts had beenincurred in the purchase of imported merchandise in the original packages, and as we were informed that the relator’s business consisted in a large part of buying and selling such imported merchandise, the statement appeared to us utterly unsatisfactory. Eor all of these reasons we were led to disbelieve the statement of relator.” The return further' alleges that the commissioners “ were unable to ascertain whether any of such accounts payable were incurred in the purchase of imported merchandise in the original packages which are non-taxable by us, or whether ■ the relator had borrowed money to pay for such imported merchandise in the -original packages, of what portion of the bills and accounts payable were directly or indirectly incurred in the purchase of such imported merchandise in the original packages, but we assumed that of such indebtedness at least the sum of $17,579 was so incurred directly or indirectly and, therefore, did not deduct the amount of such imported merchandise- owned by relator as disclosed by such statement to be of the value of $17,579. We accordingly deemed the sum of $18,540 to be the sum for which the relator was lawfully and justly assessable upon its personal property. * * * ”

Upon the matter coming on to be heard before the Special Term the relator moved upon the petition, • writ and return thereto, for judgment as prayed for in. the petition and that the assessment be reduced tb the sum of $961. The defendants moved that the writ be quashed upon the ground that the relator had failed to produce testimony to support the- allegations of the petition, and if such motion should be denied, that the court take testimony upon the issues raised by the petition and return, or appoint a refefee for that purpose. The relator’s motion was' granted and the defendants have appealed.

I ain of the opinion that the order appealed from should be affirmed. The verified statement filed by the relator showed its assets, indebtedness and the amount of personal property which was not subject to assessment. This statement was not contradicted, nor was it disputed in any way. The assumption on the part of the commissioners that some part of the indebtedness might possibly have been incurred in the purchase of non-taxable property was not only unsupported by evidence, but was contradicted by the statement itself. It appeared therein that the relator was asked : “ Has any portion of above indebtedness been contracted or incurred in the purchase of non-taxable property or securities ? * * * ”

To which it answered, “No.” There being nothing, therefore, to contradict this evidence the commissioners could not arbitrarily disregard it. (People ex rel. Edison General Electric Co. v. Barker, 141 N. Y. 251; People ex rel. Consolidated Gas Co. v. Feitner, 78 App. Div. 313.) If they were not satisfied with the statement they could have required further information from the relator on that subject. This, however, they did not do. Having accepted it as true it is no answer when the validity of the assessment is challenged, to allege that they did not believe what was therein stated. Official acts must have something more for their support when brought under judicial review than a mere surmise or belief. There must underlie the belief some evidence tending to justify it. Assessing officers cannot act arbitrarily. When evidence is laid before them as to the existence of certain facts they are bound to consider and act upon it. Of course they are not bound by statements which are contradicted and which they disbelieve where good reasons exist for such disbelief (People ex rel. Manhattan Railway Co. v. Barker, 146 N. Y. 314), but where a statement is made, the truth of which is not disputed, a mere surmise that it may not be true does not justify assessing officers in rejecting such statement or acting otherwise than in accordance therewith. Here, the verified statement filed by the relator with the commissioners disclosed the relator’s property and that part of it which was assessable. The facts being undisputed, the same were conclusive and entitled the relator to have its assessment reduced to the amount to which the Special Term reduced it. (People ex rel. Edison Electric Illuminatting Co. v. Barker, 139 N. Y. 63.) But the appellants insist that the Special Term, instead of reducing the. assessment, should have taken testimony bearing upon the issues involved, or sent the matter to a referee for that purpose. This is undoubtedly true if an issue of fact were raised by the petition for and the return to the writ. (People ex rel. Thomson v. Feitner, 168 N. Y. 441; People ex rel. Bronx Gas Co. v. Feitner, 43 App. Div. 198; People ex rel. Broadway Realty Co. v. Feitner, 61 id. 156; affd. on prevailing opinion below, 168 N. Y. 661; People ex rel. Citizens’ Lighting Co. v. Feitner, 81 App. Div. 118.) Here, there was no issue of fact, raised by the petition and return. It is true in the return the commissioners denied that the assessment was erroneous by reason of overvaluation or was unequal in that it was made at a higher. proportionate valuation than other real or personal property on the same roll, or that the same.was upon- any of the grounds illegal, erroneous or void. But the facts set out in the petition upon which such claims were made were not denied, and, therefore, these denials ’ were mere conclusions, unsupported by and contrary to the admitted facts. This being the situation the court at Special Term properly denied defendants’ motion to quash the writ or take evidence, and., properly granted relator’s motion to reduce the assessment.

The order appealed from, therefore, must be affirmed, with ten dollars costs and disbursements.

Patterson and. Laughlin, JJ., concurred; Van Brunt, P. J., dissentéd.

O’Brien, J. (concurring):

The question of whether there could be a new assessment at Special Term upon new evidence taken was directly presented in People ex rel. Citizens' Lighting Co. v. Feitner (81 App. Div. 118), and my view then was that that could not be done; but the majority of this court thought otherwise. If the relator -under the decisions of this court has a right to have a reassessment by the Special Term, no good reason is suggested why the same right should not be accorded to the tax commissioners. The present view of the majority, as I read the opinion, is against reassessment by the court on the application of the city and that the validity and correctness of the. tax must depend upon the facts before the commissioners when the tax is imposed. If the city will not be allowed to introduce additional testimony on the hearing at the Special Term to sustain their determination, it seems to me for the reasons stated in People ex rel. Citizens’ Lighting Co. v. Feitner (supra,) that one assailing the tax has no greater right. The present decision inclining to the view, therefore, that there should be no reassessment by the court at Special Term, I concur in the result.

Van Brunt, P. J. (dissenting):

I dissent. The facts set out in the petition were denied, and unüer the decisions of this court, as I understand them, the defendants were entitled to offer evidence as a matter of right.

Order affirmed, with ten dollars costs and disbursements.  