Ludloff v. United States,
108 U.S. 176 (1883)

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U.S. Supreme Court

Ludloff v. United States, 108 U.S. 176 (1883)

Ludloff v. United States

Decided April 2, 1883

108 U.S. 176


A manufacturer of cigars, in his statement furnished in May, 1878, under § 3387 of the Revised Statutes, according to Form 36 1/2, set forth "the room adjoining the store in the rear, on the first floor" of certain premises, as the place where his manufacture was to be carried on. Circular No. 181, issued in March, 1878, by the Commissioner of Internal Revenue, required that a cigar factory should be at least an entire room, "separated by walls and partitions from all other parts of the building," and that the factory designated in Form 36 1/2 should not any part of it be used,

"even though marked off or separated from the remainder by a railing, counter, bench, screen or curtain, as a store where the manufacturer can sell his cigars otherwise than in legal boxes, properly branded, labeled, and stamped."

This circular went into effect May 1, 1878. The manufacturer was engaged at the same time and place in doing business as a dealer in tobacco, having paid the special tax as such, and also the special tax as a manufacturer of cigars. He did not comply with the said circular, and had no division between the factory in the rear part of the room and the front part of the room, where he sold articles as a dealer in tobacco, except a wooden counter extending part of the way across the room, and some three feet high. He sold out of a showcase in the front part, in quantities

Page 108 U. S. 177

less than 25, from stamped boxes, which were duly branded, marked and stamped, cigars which he had made in the rear part, on which cigars the tax had been paid. For doing so, as a violation of § 3400, in removing cigars made by him without the proper stamps denoting the tax thereon, a quantity of cigars, the property of the manufacturer, found in the roar part of the room, in boxes not stamped, were seized as forfeited to the United States, under § 3400:


1. The requirements of the circular were within the power of the commissioner to prescribe, under § 3396.

2. The sales at retail were in violation of law.

3. The forfeiture claimed was incurred.

The provisions of § 3236, and subdivisions 8 and 10 of § 3244, and §§ 3387, 3388, 3390 and 3392, considered and held not to authorize such sales, they constituting, under §§ 3392, 3397 and 3400, removals of cigars from the place where they were manufactured, without the proper stamp denoting the tax thereon, because the sales were sales of cigars by their manufacturer at retail at the place of manufacture, not in stamped boxes, the cigars being in his hands as a manufacturer and not as a retail dealer.

Information against a quantity of cigars of domestic manufacture for violation of the internal revenue laws, and the regulations of the Treasury founded thereon. All the material facts appear in the opinion of the Court.

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