B-13782, APRIL 8, 1941, 20 COMP. GEN. 607

B-13782: Apr 8, 1941

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SET-OFF - CLAIMS NOT FILED WITHIN STATUTORY PERIOD - AGRICULTURAL ADJUSTMENT ACT PENALTIES WHERE AN AMOUNT WAS ERRONEOUSLY COLLECTED AS PENALTY FOR MARKETING COTTON IN EXCESS OF THE 1938 FARM MARKETING QUOTA OF A PARTICULAR COTTON PRODUCER BUT THE 2-YEAR PERIOD PRESCRIBED BY SECTION 372 (C) OF THE AGRICULTURAL ADJUSTMENT ACT. THERE IS NO AUTHORITY TO CREDIT ANY PART OF SUCH ERRONEOUS COLLECTION AGAINST THE PRODUCER'S INDEBTEDNESS ON ACCOUNT OF PENALTY FOR MARKETING COTTON IN EXCESS OF HIS FARM MARKETING QUOTA FOR 1940 SINCE THE ALLOWANCE OF CREDIT FOR THE 1938 PENALTY WOULD BE TANTAMOUNT TO MAKING A REFUND WITHOUT AUTHORITY OF LAW. 1941: I HAVE YOUR LETTER OF MARCH 29. AS FOLLOWS: THIS IS WITH REFERENCE TO YOUR DECISION B-13782.

B-13782, APRIL 8, 1941, 20 COMP. GEN. 607

SET-OFF - CLAIMS NOT FILED WITHIN STATUTORY PERIOD - AGRICULTURAL ADJUSTMENT ACT PENALTIES WHERE AN AMOUNT WAS ERRONEOUSLY COLLECTED AS PENALTY FOR MARKETING COTTON IN EXCESS OF THE 1938 FARM MARKETING QUOTA OF A PARTICULAR COTTON PRODUCER BUT THE 2-YEAR PERIOD PRESCRIBED BY SECTION 372 (C) OF THE AGRICULTURAL ADJUSTMENT ACT, AS AMENDED, FOR CLAIMING REFUND HAS EXPIRED, THERE IS NO AUTHORITY TO CREDIT ANY PART OF SUCH ERRONEOUS COLLECTION AGAINST THE PRODUCER'S INDEBTEDNESS ON ACCOUNT OF PENALTY FOR MARKETING COTTON IN EXCESS OF HIS FARM MARKETING QUOTA FOR 1940 SINCE THE ALLOWANCE OF CREDIT FOR THE 1938 PENALTY WOULD BE TANTAMOUNT TO MAKING A REFUND WITHOUT AUTHORITY OF LAW.

COMPTROLLER GENERAL WARREN TO THE SECRETARY OF AGRICULTURE, APRIL 8, 1941:

I HAVE YOUR LETTER OF MARCH 29, 1941, AS FOLLOWS:

THIS IS WITH REFERENCE TO YOUR DECISION B-13782, DATED JANUARY 10, 1941, RELATIVE TO THE REFUNDING OF MONEY COLLECTED PURSUANT TO THE COTTON MARKETING QUOTA PROVISIONS OF THE AGRICULTURAL ADJUSTMENT ACT OF 1938. WITH RESPECT TO THE FACTS PRESENTED THEREIN AND SIMILAR CASES, YOU HELD IN PART AS FOLLOWS: "THE REFUNDING OF MONEYS WHICH HAVE BEEN COVERED INTO THE TREASURY IS NOT INVOLVED. WHAT APPEARS TO BE INVOLVED IS THE ADMINISTRATIVE ADJUSTMENT OF AN ACCOUNT.'

WE NOW HAVE FOR ADMINISTRATIVE CONSIDERATION A CASE WHEREIN A COTTON PRODUCER HAS TO HIS CREDIT IN THE GENERAL FUND THE AMOUNT OF $16.00, WHICH WAS SO DEPOSITED UNDER THE MISTAKEN BELIEF THAT THE PRODUCER HAD MARKETED A CERTAIN AMOUNT OF COTTON IN EXCESS OF HIS 1938 MARKETING QUOTA; WHEREAS, IN FACT, THIS COTTON HAD BEEN PLACED UNDER LOAN. THIS PRODUCER, AT PRESENT, OWES THE UNITED STATES $3.52 IN CONNECTION WITH HIS 1940 MARKETING OF COTTON. THE PRODUCER DID NOT FILE CLAIM FOR THE RETURN OF THE $16.00 WITHIN TWO YEARS AFTER IT WAS COVERED INTO THE GENERAL FUND. IN VIEW OF THE ABOVE-QUOTED PORTION OF YOUR DECISION THE QUESTION ARISES AS TO THE NECESSITY FOR COLLECTING $3.52 FROM THE PRODUCER, SINCE HE ALREADY HAS TO HIS CREDIT IN THE GENERAL FUND $16.00. HOWEVER, YOUR OPINION IS REQUESTED AS TO WHETHER SUCH COLLECTION NEED BE MADE SINCE THE PRODUCER DID NOT FILE A CLAIM WITH THE SECRETARY WITHIN THE TWO-YEAR PERIOD PROVIDED FOR IN SECTION 372 (C) OF THE AGRICULTURAL ADJUSTMENT ACT OF 1938, AS AMENDED BY SECTION 6 OF PUBLIC, NO. 716, 76TH CONGRESS, APPROVED JULY 2, 1940.

SECTION 348 OF THE AGRICULTURAL ADJUSTMENT ACT OF 1938, 52 STAT. 31, 59, PROVIDES FOR A PENALTY FOR MARKETING COTTON IN EXCESS OF THE FARM MARKETING QUOTA FOR THE MARKETING YEAR FOR THE FARM ON WHICH SUCH COTTON WAS PRODUCED. SECTION 372 OF SAID ACT (P. 65) PROVIDES THAT THE AMOUNTS COLLECTED AS SUCH PENALTIES SHALL BE COVERED INTO THE GENERAL FUND OF THE TREASURY. SECTION 372 (C) OF SAID ACT, AS AMENDED, PROVIDES FOR REFUNDING ANY SUCH PENALTY ERRONEOUSLY, ILLEGALLY, OR WRONGFULLY COLLECTED PURSUANT TO A CLAIM FILED WITHIN 2 YEARS AFTER PAYMENT. THERE IS NO PROVISION OF LAW FOR REFUNDING ANY PAYMENT UNLESS CLAIM THEREFOR IS FILED WITH THE SECRETARY OF AGRICULTURE WITHIN THE TIME PRESCRIBED.

IN THE PRESENT CASE THE COTTON PRODUCER WAS PENALIZED BECAUSE IT WAS BELIEVED THAT HE HAD MARKETED COTTON IN EXCESS OF HIS QUOTA IN 1938, WHEN IN FACT HE HAD NOT MARKETED SUCH COTTON. FROM THE FACTS REPORTED IT APPEARS THAT THE PENALTY WAS COLLECTED IN ERROR, BUT REPAYMENT TO THE PRODUCER IS NOT NOW AUTHORIZED BY LAW. THE AMOUNT HAS BEEN COVERED INTO THE GENERAL FUND OF THE TREASURY PURSUANT TO PROVISIONS OF THE ACT AND THE TIME FOR FILING A VALID CLAIM FOR REPAYMENT HAS EXPIRED.

THE PENALTY INCURRED FOR MARKETING COTTON IN EXCESS OF HIS MARKETING QUOTA FOR 1940 IS A VALID INDEBTEDNESS, AND AS A VALID CLAIM CANNOT BE FILED FOR THE AMOUNT COLLECTED AS PENALTY IN 1938, TO ALLOW CREDIT FOR ANY PART OF THE 1938 PENALTY NOW WOULD BE TANTAMOUNT TO A REFUNDING OF A PART OF SUCH AMOUNT WITHOUT AUTHORITY OF LAW. ACCORDINGLY IN SPECIFIC ANSWER TO THE QUESTION YOU SUBMIT I HAVE TO ADVISE THAT THE 1940 PENALTY IS FOR COLLECTION WITHOUT REFERENCE TO THE ERRONEOUS COLLECTION IN 1938.