OPINION OF THE COURT
FREEDMAN, Circuit Judge.
These three petitions for review, which were consolidated for argument here as they were at the trial in the Tax Court, present two questions for consideration. One is whether the notices of income tax deficiency which the Commissioner sent to the taxpayers were directed to the statutory "last known address", and the other is whether the notices were in any event effective because the taxpayers and their designated attorney admittedly received them in the regular course of the mail.
The problems presented grow out of § 6212 of the Internal Revenue Code of 1954 which provides for notice of a deficiency in income tax:
The Internal Revenue Service questioned the tax treatment in the 1960, 1961 and 1962 income tax returns of Pennsylvania Papyrus Corporation,
The Service granted the requested extension of time, and when the protests were filed the names and addresses of the taxpayers were stated as they had been given in the income tax returns for the years involved. Thereafter on September 24, 1965, the District Director sent notices of the time and place of a conference to the taxpayers at the addresses given on their returns. On the same day the District Director sent Mr. Whitman copies of these letters together with a form letter
On March 11, 1966, Mr. Whitman wrote the Service that he did not wish the cases to be forwarded for consideration by the appellate division and went on to say: "Under the circumstances, it is my understanding that you will now proceed to cause statutory notices of deficiency (90-day letter) to be issued. * * *" On June 3, 1966, the District Director sent the deficiency notices to the taxpayers by certified mail at the addresses given on their income tax returns for the years involved and sent copies by ordinary mail to Mr. Whitman accompanied by a form letter identical to that of September 24, 1965. The taxpayers and Mr. Whitman received these notices in the regular course of the mail.
On September 9, 1966, the taxpayers filed petitions for redetermination in the Tax Court. The Commissioner moved for dismissal on the ground that the petitions were not filed within the ninety-day statutory period,
In dealing with these taxpayers the Commissioner ignored the effect of the alteration in the power of attorney, either because he interpreted the power as permitting him to continue to communicate directly with the taxpayers and to send copies to their attorney, or because he decided that the alteration was an impermissible change in the prescribed form,
The taxpayers rely heavily on Expanding Envelope and Folder Corporation v. Shotz, 385 F.2d 402 (3 Cir. 1967), where we held that notices of deficiency were validly sent to the taxpayers in care of their attorneys-in-fact at the attorneys' addresses given in the powers of attorney. The taxpayers in that case had stricken out of the same form of power of attorney the words "Copies of" and inserted the word "All". We rejected the taxpayers' contention that the address of the attorneys given in the powers was not the "last known address" within the meaning of the statute and that the words "All correspondence addressed to the taxpayers" were not sufficiently broad to include a notice of deficiency. The essence of the decision there was, as we said in our per curiam opinion: "When the taxpayers deleted the words `copies of,' relating to correspondence and substituted the word `all,' they became bound by their actions." 385 F.2d at 404. The two cases are clearly different. There the taxpayers were barred from complaining of the notice which followed their own instructions. It would be quite different, however, to require the Commissioner to follow the instructions in the power of attorney to the exclusion of all other information which sheds light on the determination of the address to which notice should be sent.
The Internal Revenue Service is often presented with more than one address for a taxpayer, and where in the course of dealings between the Commissioner and the taxpayer, letters are successfully sent to different addresses, it is unreasonable to assume that one and not the other of the addresses is the "last known address" for the purpose of giving the deficiency notice. For this reason in Delman v. Commissioner, 384 F.2d 929 (3 Cir. 1967), cert. denied, 390 U.S. 952, 88 S.Ct. 1044, 19 L.Ed.2d 1144 (1968), we accepted the view that the last known address is an address to which the Commissioner in all the circumstances may reasonably believe the taxpayers wish the notices sent.
The Tax Court made no express finding that the original notices of deficiency were sent to the statutory last known address, but such a finding is implicit in its decision. In the circumstances we cannot say that such a conclusion was clearly erroneous. See Commissioner v. Duberstein, 363 U.S. 278, 291, 80 S.Ct. 1190, 4 L.Ed.2d 1218 (1960); Yara Engineering Company v. Commissioner, 344 F.2d 113 (3 Cir. 1965).
Even if it could be said that the notices of deficiency were not sent to the taxpayers at their last known addresses because the originals should have been sent to Mr. Whitman by certified or registered mail, the notices in this case would still be effective.
We held in Delman that § 6212(b) (1) did not render invalid a notice of deficiency which actually was received although the notice was not sent to the address specified in the power of attorney.
Analysis of taxpayers' rigidly restricted argument emphasizes the lack of precision in subsections (a) and (b) (1). They are not models of draftsmanship. Literally, subsection (a) merely authorizes the Secretary or his delegate to send
The statute, however, must be given a sensible reading which makes its provisions workable, a purpose which the draftsmen must be presumed to have intended. With this purpose in mind the meaning of the statute is readily ascertainable.
Subsection (a) authorizes a notice of deficiency to be sent by registered or certified mail. In authorizing such method of notice it does not forbid any other method. If a revenue agent personally delivers by hand a notice of deficiency to the taxpayer it could not rationally be suggested that the notice was invalid because it violated a requirement of subsection (a).
Subsection (b) (1) makes no reference to a requirement of certified or registered mail, but in speaking of the mailing of a notice of deficiency to the taxpayer it must refer to the mailing by certified or registered mail authorized by subsection (a). Since subsection (b) (1) also specifies that such a notice is sufficient if mailed to the taxpayer at his last known address in the exceptional cases which affect the taxpayer's ability to give notice of a change in address, it must intend that the same consequence shall follow from a similar mailing to a taxpayer who is not under a disability. The obvious formula for mailing, therefore, is that the notice be sent by certified or registered mail to the taxpayer at his last known address, and when this is done the notice is adequate and effective even though it may later be shown that in fact it was never delivered to the taxpayer.
A deficiency notice, unlike a complaint in a civil action, is not a legal process or pleading even though it is a prerequisite to the subsequent litigation before the Tax Court on a petition for redetermination. It usually marks the
In the present case we have the converse of the situation which § 6212 envisaged and in which it protected the Commissioner. Here the Commissioner need not rely on the statutory protection given to a notice which was mailed but not received. Instead he has shown the actual delivery of notice to the taxpayers and their attorney. The statute does not make this inadequate merely because it authorizes an alternative mailing of notice which it makes sufficient without proof of actual delivery. The case is no different than it would have been if the original notice had been handed to the taxpayers and a copy to their attorney on their visit to his office. In such circumstances he could rely upon the actual delivery of the notices instead of a mailing in the channel which the statute authorizes and renders valid without regard to actual receipt.
The taxpayers argue that § 6503(a) of the Internal Revenue Code which suspends the running of the statute of limitations on the making of deficiency assessments, "after the mailing of a notice under section 6212(a)" [Emphasis added.] is proof that notice of a deficiency must be given by mail in compliance with § 6212(a). We may ourselves add the provision of § 6213(a) which measures the ninety-day period for filing of a taxpayer's petition for reconsideration in the Tax Court as commencing when the notice of deficiency "authorized in § 6212 is mailed". In both instances the statutory language, referring to the mailing of the notice of deficiency, is patterned on the customary rather than the exceptional case. We do not believe it reasonable to convert the permissive provisions of § 6212(a) and 6212(b) (1) relating to mailing into a mandatory requirement because of the reference to them in § 6503(a) and § 6213(a). Such a reading of the statute would bind a taxpayer who never received a notice sent by registered or certified mail addressed to him at his last known address, but would leave it ineffective if handed to him personally.
The taxpayers argue that this incongruous result must be insisted upon because the Commissioner has at times held taxpayers to a rigid and technical compliance with statutory requirements. Their claim in effect is that the sword with which he has in other cases struck down the rights of taxpayers on technicalities must now be wielded against him in order to insure equal justice, — perhaps more accurately described as equal injustice.
The legal problems created by the revenue statutes are proverbially complicated and difficult. Their intricacies result from the vast and complex area with which they deal, aggravated in some instances by artificial rules of substantive law devised to close loopholes unjustly enriching some taxpayers, and in other cases by the effort to make the tax consequences of business and financial transactions more predictable. There is no reason, however, for introducing artificiality into the procedural requirements
We hold, therefore, that the notices of deficiency were adequate and effective and that the Tax Court was justified in dismissing the petitions for redetermination as untimely filed.
The decision of the Tax Court will be affirmed.
See Boccuto v. Commissioner, 277 F.2d 549 (3 Cir. 1960), where a notice of deficiency mailed by registered mail to the last known address of the taxpayer on November 13, 1958, but returned undelivered was handed to the taxpayer at the Internal Revenue Service office on January 21, 1959, and he signed a receipt showing that the delivery on that date was an effort to carry forward the notice mailed on November 13, 1958. We held that the notice was given on November 13, 1958 and that the 90-day period for filing a petition for redetermination with the Tax Court ran from that date. Compare Tenzer v. Commissioner, 285 F.2d 956 (9 Cir. 1960).