B-146353, AUG. 17, 1961

B-146353: Aug 17, 1961

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TO CONTRACT TOOL AND STAMPING CORP.: REFERENCE IS MADE TO YOUR LETTER OF JUNE 8. YOUR OFFER WAS ACCEPTED FOR ITEMS B AND C BY LETTER OF MARCH 14. YOU ADVISED PICATINNY ARSENAL THAT YOU WOULD BE UNABLE TO ACCEPT THE AWARD BECAUSE 60 PERCENT OF THE WORK WOULD HAVE TO BE SUBCONTRACTED AND YOU WERE UNABLE TO FIND ANYONE TO PERFORM SAME. YOU WERE NOTIFIED THAT YOUR RIGHT TO PROCEED WAS TERMINATED AND THAT THE GAGES WOULD BE PROCURED ELSEWHERE AND ANY EXCESS COST CHARGED TO YOUR ACCOUNT. THE GAGES WERE PURCHASED FROM THE INDUS CORPORATION. IN SUPPORT OF YOUR PROTEST AGAINST THE SETOFF YOU REFER TO THE FACT THAT THERE IS PRESENTLY NO JUDGMENT AGAINST YOU BY ANY BRANCH OF THE GOVERNMENT AND YOU INVITE ATTENTION TO THE PROVISIONS OF SECTIONS 71 AND 227 OF TITLE 31.

B-146353, AUG. 17, 1961

TO CONTRACT TOOL AND STAMPING CORP.:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 8, 1961, REQUESTING PAYMENT OF $5,300 WITHHELD FROM THE TAX REFUND AND APPLIED IN LIQUIDATION OF YOUR INDEBTEDNESS TO THE UNITED STATES DUE TO DEFAULT UNDER ARMY CONTRACT NO. DA-28-017-ORD-1876 WHILE DOING BUSINESS AS GREENFIELD TOOL AND STAMPING CORPORATION.

BY LETTER DATED FEBRUARY 15, 1952, ADDRESSED TO PICATINNY ARSENAL, DOVER, NEW JERSEY, YOU OFFERED TO FURNISH VARIOUS ITEMS DESCRIBED IN QUOTATION REQUEST NO. N-2347, INCLUDING EIGHT PROFILE AND ALIGNMENT GAGES (ITEM B) AT $1,110 EACH AND ONE ALIGNMENT CHECK GAGE (ITEM C) AT $710, OR A TOTAL AS TO THESE TWO ITEMS OF $9,590. YOUR OFFER WAS ACCEPTED FOR ITEMS B AND C BY LETTER OF MARCH 14, 1952, SIGNED BY J. D. PRENDERGAST, PRINCIPAL CONTRACTING OFFICER, DIRECTING YOU TO PROCEED IMMEDIATELY WITH THE PRODUCTION OF THE ARTICLES.

YOU ADVISED PICATINNY ARSENAL THAT YOU WOULD BE UNABLE TO ACCEPT THE AWARD BECAUSE 60 PERCENT OF THE WORK WOULD HAVE TO BE SUBCONTRACTED AND YOU WERE UNABLE TO FIND ANYONE TO PERFORM SAME. BY LETTER OF JUNE 13, 1952, YOU WERE NOTIFIED THAT YOUR RIGHT TO PROCEED WAS TERMINATED AND THAT THE GAGES WOULD BE PROCURED ELSEWHERE AND ANY EXCESS COST CHARGED TO YOUR ACCOUNT. THE GAGES WERE PURCHASED FROM THE INDUS CORPORATION, INDIANAPOLIS, INDIANA, AT A COST OF $14,890, RESULTING IN EXCESS COST OF $5,300.

IN SUPPORT OF YOUR PROTEST AGAINST THE SETOFF YOU REFER TO THE FACT THAT THERE IS PRESENTLY NO JUDGMENT AGAINST YOU BY ANY BRANCH OF THE GOVERNMENT AND YOU INVITE ATTENTION TO THE PROVISIONS OF SECTIONS 71 AND 227 OF TITLE 31, UNITED STATES CODE. HOWEVER, THE PROVISIONS OF 31 U.S.C. 227 ARE APPLICABLE ONLY WHEN A JUDGMENT HAS BEEN RECOVERED AGAINST THE UNITED STATES AND WE PROPOSE TO COLLECT AN INDEBTEDNESS OF THE PLAINTIFF BY SETOFF, WHICH IS NOT THE CASE HERE.

THE RESPONSIBILITY OF THE ACCOUNTING OFFICERS OF THE GOVERNMENT TO CONSIDER BOTH DEBITS AND CREDITS IN THE SETTLEMENT OF CLAIMS INVOLVING THE UNITED STATES EXISTS BY VIRTUE OF SECTION 305 OF THE BUDGET AND ACCOUNTING ACT OF JUNE 10, 1921, 42 STAT. 24, 31 U.S.C. 71, TO WHICH YOU ALSO REFER AND WHICH PROVIDES THAT "ALL CLAIMS AND DEMANDS WHATEVER BY THE GOVERNMENT OF THE UNITED STATES OR AGAINST IT, AND ALL ACCOUNTS WHATEVER IN WHICH THE GOVERNMENT OF THE UNITED STATES IS CONCERNED, EITHER AS DEBTOR OR CREDITOR, SHALL BE SETTLED AND ADJUSTED IN THE GENERAL ACCOUNTING OFFICE.' THE RESULTING AUTHORITY OF THIS OFFICE TO EFFECT COLLECTION OF AN INDEBTEDNESS BY WITHHOLDING AMOUNTS OTHERWISE DUE THE DEBTOR, INCLUDING TAX REFUNDS, IS WELL SETTLED BY NUMEROUS DECISIONS OF THE COURTS AND OF THIS OFFICE. SEE UNITED STATES V. MUNSEY TRUST CO., 332 U.S. 235, 240; 28 COMP. GEN. 543, 14 ID. 849, 7 ID. 186 AND CASES CITED.

IN VIEW OF THE ABOVE IT MUST BE CONCLUDED THAT THE WITHHOLDING OF THE SUM OF $5,300 WAS PROPER AND SUCH ACTION IS SUSTAINED.