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Guzik v. United States

December 10, 1931

GUZIK
v.
UNITED STATES



Appeal from the District Court of the United States for the Eastern Division of the Northern District of Illinois; Charles Edgar Woodward, Judge.

Author: Evans

Before ALSCHULER, EVANS, and SPARKS, Circuit Judges.

EVANS, Circuit Judge.

Appellant was convicted on all three counts of an indictment charging willful attempts to defeat and evade an income tax to the extent of: $150,934.87 upon an alleged gross taxable income of $642,154.43 for 1927; $71,569.85 upon an alleged gross taxable income of $338,147.92 for 1928; and $3,394.87 upon an alleged taxable income of $54,900 for 1929. Each count charged the willful attempt to evade the tax by filing a return wherein it was stated that the taxpayer's income was much less than that actually received by him for each of the years in question. Upon a verdict of guilty, the court sentenced appellant to two years in the penitentiary and imposed a fine of $7,500 on both counts 1 and 2, and a year and a day in the penitentiary and a fine of $2,500 on count 3. The sentences were to be served consecutively, and the fines imposed were cumulative.

The assignments of error may be devided into three classes: (1) Errors in overruling appellant's demurrer to the indictment asserted to be invalid because (a) charging a crime under section 1266, title 26, USCA, which is not applicable to income tax violations; (b) of the lack of an assessment of the tax, which assessment it is alleged is required by 26 USCA ยงยง 1045, 1047, 1048,and 1050; (c) charging a consummated offense; and (d) the Revenue Acts of 1926 and 1928 are unconstitutional because of indefiniteness. (2) The second class of assigned errors relates to the admission in evidence: (a) Of the bank's records, (b) of computations and conclusions of an accountant based upon assumptions claimed not to have been proved, (c) the refusal to admit in evidence testimony showing no taxes due by appellant, and (d) the refusal to admit evidence of policy of the Department with respect to the preparation and form of returns of taxpayers engaged in illegal occupations. (3) The remaining assignments of error are directed to the overruling of appellant's motion to direct a verdict and to the court's instructions to the jury.

In order to prove gross income, and therefore probable taxable income of the appellant, the government introduced the following evidence: Bank deposits in two banks (one account was under an assumed name) totaling $953,303.93; cashier's checks cashed by appellant but not deposited, totaling $48,000; dividends of $37,500 received by appellant's physician on stock alleged to have been transferred to him by appellant in order to evade surtax; the testimony of a general cashier of appellant's gambling establishments that he, under instruction of the appellant, converted surplus from the operation of a gambling business into cashier's checks (totaling $147,500), which he delivered to appellant's messenger.

Appellee contends that the evidence showed reported and actual income as follows:

Reported Actual

Income Income

1927 $18,090 $647,654.43

1928 24,000 333,654.92

1929 18,150 63,044.11

$60,240 $1,044,353.46

It will be unnecessary to again discuss the various assignments of error passed upon by this court since this appeal was taken. The indictment is properly drawn under section 1266, 26 USCA, which we held applicable to income tax violations in Capone v. United States, 51 F.2d 609; O'Brien v. United States, 51 F.2d 193; and Oliver v. United States, 54 F.2d 48, decided by this court on December 2, 1931. The contention that the indictment for attempt to evade was not good because the attempt was consummated was rejected in O'Brien v. United States (C.C.A.) 51 F.2d 193. Appellant contends that the bank records were not admissible in evidence because they neither proved nor tended to prove gross or net income. In the Oliver Case, supra, we stated that "this (the deposits) alone, perhaps, is not sufficient to justify the conclusion that this ...


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