B-15306, MAY 2, 1941, 20 COMP. GEN. 711

B-15306: May 2, 1941

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A STIPULATION IN GOVERNMENT SPECIFICATIONS THAT " THE PRICES HEREIN DO NOT INCLUDE ANY FEDERAL TAXES FROM WHICH EXEMPTION IS GRANTED. OR AS TO WHICH A CREDIT OR REFUND IS PROVIDED FOR UNDER THE PROVISIONS OF SECTION 401 OF THE REVENUE ACT OF 1935. " IS NOT ONLY CONFUSING AND CONFLICTING WHEN READ IN CONNECTION WITH A STIPULATION IN THE SAME SPECIFICATIONS WHICH PROVIDES THAT " PRICES BID HEREIN INCLUDE ANY FEDERAL TAX HERETOFORE IMPOSED BY THE CONGRESS WHICH IS APPLICABLE TO THE MATERIAL ON THIS BID. " BUT IS UNAUTHORIZED IN THAT IT DEPRIVES A BIDDER OF HIS STATUTORY RIGHT UNDER THE SAID REVENUE ACT AND DECISIONS OF THIS OFFICE EITHER TO EXCLUDE OR INCLUDE FEDERAL TAXES. WHERE GOVERNMENT SPECIFICATIONS CONTAINED AN UNAUTHORIZED PROVISION TO THE EFFECT THAT CERTAIN FEDERAL TAXES WERE NOT INCLUDED IN THE BID PRICE.

B-15306, MAY 2, 1941, 20 COMP. GEN. 711

TAXES - FEDERAL - UNAUTHORIZED AND CONFLICTING PROVISIONS QUESTIONS INVOLVING A MATTER OF PROPRIETY OF PROPOSED ADMINISTRATIVE ACTION IN CONNECTION WITH GOVERNMENT PURCHASES--- SUCH AS, IN THIS CASE, THE ISSUANCE OF TAX EXEMPTION CERTIFICATES--- SHOULD BE SUBMITTED TO THE COMPTROLLER GENERAL BY THE HEAD OF THE DEPARTMENT CONCERNED, RATHER THAN BY AN EMPLOYEE OF THE DEPARTMENT TO A DIVISION OF THE GENERAL ACCOUNTING OFFICE. A STIPULATION IN GOVERNMENT SPECIFICATIONS THAT " THE PRICES HEREIN DO NOT INCLUDE ANY FEDERAL TAXES FROM WHICH EXEMPTION IS GRANTED, OR AS TO WHICH A CREDIT OR REFUND IS PROVIDED FOR UNDER THE PROVISIONS OF SECTION 401 OF THE REVENUE ACT OF 1935," IS NOT ONLY CONFUSING AND CONFLICTING WHEN READ IN CONNECTION WITH A STIPULATION IN THE SAME SPECIFICATIONS WHICH PROVIDES THAT " PRICES BID HEREIN INCLUDE ANY FEDERAL TAX HERETOFORE IMPOSED BY THE CONGRESS WHICH IS APPLICABLE TO THE MATERIAL ON THIS BID," BUT IS UNAUTHORIZED IN THAT IT DEPRIVES A BIDDER OF HIS STATUTORY RIGHT UNDER THE SAID REVENUE ACT AND DECISIONS OF THIS OFFICE EITHER TO EXCLUDE OR INCLUDE FEDERAL TAXES. A FEDERAL TAX PROVISION INCORPORATED IN AN APPROVED GOVERNMENT STANDARD FORM OF CONTRACT MAY NOT BE ADMINISTRATIVELY CHANGED OR MODIFIED WITHOUT PREVIOUS AUTHORIZATION FROM THE PROCUREMENT DIVISION OF THE TREASURY DEPARTMENT. WHERE GOVERNMENT SPECIFICATIONS CONTAINED AN UNAUTHORIZED PROVISION TO THE EFFECT THAT CERTAIN FEDERAL TAXES WERE NOT INCLUDED IN THE BID PRICE, WHICH PROVISION WAS IN CONFLICT WITH ANOTHER PROVISION TO THE EFFECT THAT FEDERAL TAXES APPLICABLE TO THE INVOLVED MATERIAL WERE INCLUDED, NO OBJECTION WILL BE MADE BY THIS OFFICE IF IT BE DETERMINED ADMINISTRATIVELY THAT THE CONTRACTOR SHOULD BE ISSUED A TAX EXEMPTION CERTIFICATE BASED ON THE CONTRACTOR'S AFFIDAVIT, OR OTHER ACCEPTABLE EVIDENCE, THAT THE FEDERAL EXCISE TAX, AS SUCH, WAS EXCLUDED FROM THE BID PRICE. DECISIONS HOLDING THAT EX POST FACTO STATEMENTS OF CONTRACTOR ARE NOT ACCEPTABLE IN TAX EXEMPTION CERTIFICATE ISSUANCE MATTERS, DISTINGUISHED.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF THE INTERIOR, MAY 2, 1941:

THERE HAS BEEN BROUGHT TO MY ATTENTION CORRESPONDENCE BETWEEN THE CHIEF, ACCOUNTING DIVISION OF THE BONNEVILLE POWER ADMINISTRATION, PORTLAND, OREG., HEREAFTER REFERRED TO AS THE ADMINISTRATION, AND THE CLAIMS DIVISION OF THIS OFFICE, RELATIVE TO THE ISSUANCE OF EXCISE TAX EXEMPTION CERTIFICATES TO THE FOUR WHEEL DRIVE AUTO CO., COVERING EXCISE TAXES ON CERTAIN FWD TRUCKS PURCHASED FROM SAID COMPANY FOR THE USE OF THE BONNEVILLE PROJECT UNDER CONTRACT IBP-998, MARCH 25, 1940.

THE INVITATION FOR BIDS UPON WHICH THE CONTRACT RESTED INCLUDED STIPULATIONS WITH REFERENCE TO TAXES AS FOLLOWS:

1-13. FEDERAL, STATE, COUNTY, AND MUNICIPAL TAXES.--- PRICES BID HEREIN INCLUDE ANY FEDERAL TAX HERETOFORE IMPOSED BY THE CONGRESS WHICH IS APPLICABLE TO THE MATERIAL ON THIS BID. IF ANY SALES TAX, PROCESSING TAX, ADJUSTMENT CHARGE, OR OTHER TAXES OR CHARGES ARE IMPOSED OR CHANGED BY THE CONGRESS AFTER THE DATE SET FOR THE OPENING OF THIS BID AND MADE APPLICABLE DIRECTLY UPON THE PRODUCTION, MANUFACTURE, OR SALE OF THE SUPPLIES COVERED BY THIS BID, AND ARE PAID TO THE GOVERNMENT BY THE CONTRACTOR ON THE ARTICLES OR SUPPLIES HEREIN CONTRACTED FOR, THEN THE PRICES NAMED IN THIS BID WILL BE INCREASED OR DECREASED ACCORDINGLY, AND ANY AMOUNT DUE THE CONTRACTOR AS A RESULT OF SUCH CHANGE WILL BE CHARGED TO THE GOVERNMENT AND ENTERED ON VOUCHERS (OR INVOICES) AS SEPARATE ITEMS.

THE PRICES HEREIN DO NOT INCLUDE ANY FEDERAL TAXES FROM WHICH EXEMPTION IS GRANTED, OR AS TO WHICH A CREDIT OR REFUND IS PROVIDED FOR UNDER THE PROVISIONS OF SECTION 401 OF THE REVENUE ACT OF 1935 (ACT OF AUGUST 30, 1935; 49 STAT. 1014; 1025-1026); NOR ANY TAX IMPOSED BY A STATE, COUNTY, OR MUNICIPALITY UPON THE TRANSACTION OF THIS PROCUREMENT OF THESE MATERIALS.

FOR BREVITY, THESE STIPULATIONS WILL BE REFERRED TO HEREINAFTER AS PARAGRAPH 1 AND PARAGRAPH 2. THE CONTRACTOR TOOK NO EXCEPTION TO THE TAX PROVISIONS AND LIKEWISE MADE NO OTHER AFFIRMATIVE SHOWING UPON THE FACT OF ITS BID THAT THE FEDERAL EXCISE TAX WAS EXCLUDED, OR THAT IT WOULD REQUIRE AN EXEMPTION CERTIFICATE THEREFOR.

UPON COMPLETION OF THE CONTRACT, THE CONTRACTOR, BY LETTER OF JUNE 20, 1940, REQUESTED THE ADMINISTRATION TO FURNISH IT WITH TAX EXEMPTION CERTIFICATES COVERING APPLICABLE FEDERAL EXCISE TAXES, BUT WAS INFORMED BY REPLY OF JUNE 25, 1940, IN PERTINENT PART, AS FOLLOWS:

YOUR ATTENTION IS INVITED TO PARAGRAPH 1-13 OF SPECIFICATIONS WHICH WAS SUBMITTED AS A PART OF YOUR BID. IT WILL BE NOTED THEREIN THAT IT IS SPECIFICALLY STATED THAT THE PRICES BID INCLUDE ALL FEDERAL TAXES. WILL BE FURTHER NOTED THAT NO PROVISION IS MADE IN THE CONTRACT FOR CONSIDERATION OF THE FACT THAT YOU WOULD EVENTUALLY CLAIM EXEMPTION FOR THE TAXES ON THE EQUIPMENT SUPPLIED BY YOUR FIRM. THEREFORE, THIS OFFICE IS PROHIBITED BY LAW FROM ISSUING TAX EXEMPTION CERTIFICATES IN CONNECTION WITH THE PURCHASE UNDER THIS CONTRACT.

WHILE THE POSITION THAT THIS OFFICE IS REQUIRED TO TAKE IS REGRETTABLE, YOU WILL READILY UNDERSTAND THAT ISSUANCE OF TAX EXEMPTION CERTIFICATES IN CONNECTION WITH PURCHASES UNDER THE ABOVE MENTIONED CONTRACT WOULD, IN EFFECT, BE INCREASING THE BID PRICE ON THE TRUCKS AFTER THE AWARD HAD BEEN MADE. THIS WOULD BE DECIDEDLY UNFAIR TO OTHER BIDDERS AND WOULD OPERATE TO RESTRICT FREE AND OPEN COMPETITION REQUIRED BY LAW.

THE TAX EXEMPTION CERTIFICATE WHICH YOU ENCLOSED WITH YOUR LETTER IS RETURNED HEREWITH UNSIGNED. YOU ARE ADVISED, HOWEVER, THAT YOU ARE PRIVILEGED TO FILE A CLAIM FOR THE ISSUANCE OF TAX EXEMPTION CERTIFICATES IF YOU FEEL THE ACTION TAKEN BY THIS OFFICE TO BE UNWARRANTED. SUCH A CLAIM, ALTHOUGH ORIGINALLY PRESENTED TO THIS OFFICE, WOULD BE SUBMITTED TO HIGHER AUTHORITY FOR CONSIDERATION.

IT WILL BE NOTED THAT SAID LETTER CITED PARAGRAPH 1 BUT MADE NO REFERENCE TO PARAGRAPH 2 OF THE TAX PROVISIONS OF THE CONTRACT. THE CONTRACTOR REPLIED UNDER DATE OF JULY 19, 1940, IN PERTINENT PART, AS FOLLOWS:

WE ARE QUOTING BELOW FROM THE SECOND PARAGRAPH UNDER SECTION 1-13 OF INVITATION NO. 778 WHICH REFERS TO FEDERAL EXCISE TAX EXEMPTIONS.

" THE PRICES HEREIN DO NOT INCLUDE ANY FEDERAL TAXES FROM WHICH EXEMPTION IS GRANTED, OR AS TO WHICH A CREDIT OR REFUND IS PROVIDED FOR UNDER THE PROVISIONS OF SECTION 401 OF THE REVENUE ACT OF 1935 (ACT OF AUGUST 30, 1935, 49 STAT. 1014; 1025-1026); NOR ANY TAX IMPOSED BY A STATE, COUNTY, OR MUNICIPALITY UPON THE TRANSACTION OF THIS PROCUREMENT OF THESE MATERIALS.'

SINCE GOVERNMENT TRUCK PURCHASES ARE SUBJECT TO EXCISE TAX EXEMPTION, WE ASK THAT YOU KINDLY COMPLETE FEDERAL FORM NO. 1094 FOR BOTH THE FWD TRUCKS PURCHASED ON IBP-998 AND IBP-1013.

IF THE ISSUING OF SUCH EXEMPTION CERTIFICATES COMES UNDER THE JURISDICTION OF SOME OTHER DEPARTMENT, WON-T YOU KINDLY REFER THIS MATTER TO THE PROPER AUTHORITIES?

THE TWO LETTERS FROM THE CONTRACTOR, TOGETHER WITH COPY OF THE LETTER OF JUNE 25, 1940, QUOTED IN PART ABOVE, WERE TRANSMITTED TO THE CLAIM DIVISION OF THIS OFFICE BY LETTER OF JULY 23, 1940, FROM THE CHIEF, ACCOUNTING DIVISION OF THE ADMINISTRATION, IN PERTINENT PART, AS FOLLOWS:

PARAGRAPH 1-13 OF SPECIFICATIONS OF THE ABOVE-MENTIONED CONTRACT STATES " PRICES BID HEREIN INCLUDE ANY FEDERAL TAX HERETOFORE IMPOSED BY THE CONGRESS WHICH IS APPLICABLE TO THE MATERIAL ON THIS BID.' IT IS ALSO STATED IN THE SAME PARAGRAPH OF THE ABOVE-MENTIONED SPECIFICATIONS THAT " THE PRICES HEREIN DO NOT INCLUDE ANY FEDERAL TAXES FROM WHICH EXEMPTION IS GRANTED, OR AS TO WHICH A CREDIT OR REFUND IS PROVIDED FOR UNDER THE PROVISIONS OF SECTION 401 OF THE REVENUE ACT OF 1935 (ACT OF AUGUST 30, 1935; 49 STAT. 1014; 1025 1026); NOR ANY TAX IMPOSED BY A STATE, COUNTY, OR MUNICIPALITY UPON THE TRANSACTION OF THIS PROCUREMENT OF THESE MATERIALS.'

ALTHOUGH THESE TWO STATEMENTS ARE CONFLICTATORY THE CONTRACTOR HAS NOT STATED ELSEWHERE IN THIS BID ANY EXCEPTION TO THE BID PRICE OF $10,502.00 NOR STATED THAT TAX EXEMPTION CERTIFICATES WOULD BE CLAIMED IN CONNECTION WITH THIS TRANSACTION. THE AWARD WAS THEREFORE MADE UNDER THE ASSUMPTION THAT SUCH TAXES AS WERE IMPOSED BY LAW WERE INCLUDED IN THE BID PRICE. THIS OFFICE CANNOT RECOMMEND THE ISSUANCE OF THE TAX EXEMPTION CERTIFICATES AS REQUESTED BY THE CONTRACTOR AND THEREFORE SUBMITS THE CLAIM TO YOUR OFFICE FOR SUCH ACTION AS IS PERMITTED UNDER THE CONTRACT.

IN VIEW OF THE ADMINISTRATIVE DISAPPROVAL OF THE CLAIM FOR ISSUANCE OF THE TAX EXEMPTION CERTIFICATES INDICATED IN THE CONCLUDING SENTENCE ABOVE, REPLY WAS MADE BY OFFICE LETTER DATED AUGUST 22, 1940, AS FOLLOWS:

REFERENCE IS MADE TO YOUR LETTER OF JULY 23, 1940, FORWARDING CORRESPONDENCE FROM THE FOUR WHEEL DRIVE AUTO CO., CLINTONVILLE, WISCONSIN, REQUESTING THE ISSUANCE OF TAX EXEMPTION CERTIFICATES ON TWO TRUCKS PURCHASED UNDER CONTRACT NO. IBP-998, DATED MARCH 25, 1940.

IN REPLY YOU ARE ADVISED THAT THE MATTER OF THE ISSUANCE OF THE TAX EXEMPTION CERTIFICATES INVOLVED IS NOT ONE WITHIN THE JURISDICTION OF THIS OFFICE, BUT ONE WITHIN THE PROVINCE OF THE OFFICE OF THE ADMINISTRATOR, BONNEVILLE PROJECT.

IN VIEW OF THE FOREGOING, YOU ARE ADVISED THAT UPON THE BASIS OF THE PRESENT RECORD NO FURTHER ACTION WILL BE TAKEN BY THIS OFFICE.

WITH FURTHER REFERENCE TO THE MATTER, THE CHIEF, ACCOUNTING DIVISION OF THE ADMINISTRATION, ADDRESSED A LETTER TO THE CLAIMS DIVISION OF THIS OFFICE, UNDER DATE OF JANUARY 9, 1941, STATING THAT THE ADMINISTRATIVE OFFICE WAS AWARE THAT THE ACTUAL ISSUANCE OF TAX EXEMPTION CERTIFICATES WAS WITHIN THE PROVINCE OF THE BONNEVILLE POWER ADMINISTRATION BUT THAT---

* * * IN THIS PARTICULAR INSTANCE THE AUTHORITY FOR SUCH ACTION WAS QUESTIONED, THE ENTIRE MATTER BEING DEPENDENT UPON THE INTERPRETATION OF THE TAX PROVISIONS OF THE CONTRACT. WHAT THIS OFFICE ACTUALLY DESIRED IN PRESENTING THE MATTER TO THE GENERAL ACCOUNTING OFFICE WAS A DEFINITE APPROVAL OR DISAPPROVAL OF THE ISSUANCE OF THE TAX EXEMPTION CERTIFICATES UNDER CONTRACT IBP-998.

WHEN THE LETTER OF AUGUST 22, 1940, OF THE CLAIMS DIVISION WAS RECEIVED AT THIS OFFICE, STATING THAT THE QUESTION AS TO THE ISSUANCE OF THE TAX EXEMPTION CERTIFICATES WAS ONE FOR ADMINISTRATIVE DECISION, THE MATTER WAS GIVEN FURTHER CONSIDERATION BY THE INTERESTED DIVISIONS OF THE BONNEVILLE POWER ADMINISTRATION AND THE CONCLUSION REACHED THAT THERE WAS STRONG JUSTIFICATION FOR THE ISSUANCE OF THESE CERTIFICATES BY THE ADMINISTRATOR. WE OUTLINE IN THIS LETTER THE ARGUMENTS IN FAVOR OF THE ISSUANCE OF THESE CERTIFICATES.

AFTER SETTING OUT THE PROVISIONS OF THE CONTRACT WITH REFERENCE TO TAXES, PARAGRAPHS 1 AND 2 AS QUOTED ABOVE, THE LETTER CONTINUED IN PART AS FOLLOWS:

THE FIRST PARAGRAPH OF THIS SECTION IS FOUND IN THE APPROVED FORM OF STANDARD SUPPLY CONTRACT NO. 33. THE ADDITIONAL PARAGRAPH HAS BEEN USED IN THE SAME FORM BY THE BONNEVILLE POWER ADMINISTRATION AND VARIOUS OTHER GOVERNMENTAL AGENCIES INCLUDING THE U.S. ENGINEERS AND THE RECLAMATION SERVICE OVER A PERIOD OF YEARS.

THERE IS NOT NECESSARILY ANY INCONSISTENCY OR CONFLICT IN THE FIRST AND SECOND PARAGRAPHS OF THIS SECTION. IT IS POSSIBLE TO SO INTERPRET THEM THAT THEY ARE ENTIRELY CONSISTENT, THUS:

THE FIRST SENTENCE STATES THAT INCLUDED IN THE BID PRICE IS ANY FEDERAL TAX "APPLICABLE" TO THE MATERIAL TO BE FURNISHED AT THE TIME THE INVITATION IS ISSUED. THE MANUFACTURERS' EXCISE TAX IN QUESTION WAS NOT "APPLICABLE" TO THE VEHICLES TO BE SOLD FOR THE EXCLUSIVE USE OF THE UNITED STATES WHICH WERE COVERED BY THIS BID. THE BALANCE OF THE FIRST PARAGRAPH DEALS WITH CHANGES IN TAXES MADE BY CONGRESS AFTER THE BID OPENING. NO SUCH CHANGES ARE IN QUESTION HERE. THE SECOND PARAGRAPH MERELY CLARIFIES THE FIRST SENTENCE OF THE FIRST PARAGRAPH, STATING THE PROPOSITION CONVERSELY: THAT THE PRICES BID DO NOT INCLUDE FEDERAL TAXES FROM WHICH EXEMPTION IS GRANTED, CITING THE STATUTE INVOLVED. THESE TAXES FROM WHICH EXEMPTION IS GRANTED ARE NOT "APPLICABLE" TO THE MATERIAL COVERED BY THE BID.

SECTIONS 3442-3443, INTERNAL REVENUE CODE, TITLE 26, U.S.C., PROVIDE THAT THE MANUFACTURER'S EXCISE TAX IS NOT APPLICABLE TO MOTOR VEHICLES FOR THE EXCLUSIVE USE OF THE UNITED STATES, THAT SUCH VEHICLES ARE EXEMPT FROM SUCH TAX AND THAT IF SUCH TAX HAS BEEN PAID, THE PAYOR IS ENTITLED TO A CREDIT OR REFUND.

IN THE COMPTROLLER GENERAL'S DECISIONS, THE PRINCIPLE IS REITERATED THAT SUCH TAXES ARE PRESUMED TO BE INCLUDED IN A BID PRICE UNLESS THEIR EXCLUSION IS AFFIRMATIVELY SHOWN ON THE FACE OF THE BID.

THE SECTION QUOTED ABOVE WAS AN AFFIRMATIVE STATEMENT ON THE FACE OF THE BID THAT SUCH TAXES WERE EXCLUDED FROM THE BID PRICE, AND IT WAS, THEREFORE, UNNECESSARY FOR THE BIDDER TO INCLUDE ANY ADDITIONAL STATEMENT TO THE SAME EFFECT. HE WAS NOT INVITED TO MAKE A STATEMENT AS TO WHETHER OR NOT SUCH TAXES WERE DEDUCTED FROM OR INCLUDED IN HIS BID PRICE. TRUE, IF HE HAD MADE AN AFFIRMATIVE RECITATION THAT SUCH TAXES WERE INCLUDED IN THE BID PRICE, IT WOULD HAVE FURNISHED NO GROUND FOR REJECTION OF THE BID, SINCE THE FORM OF THE INVITATION COULD NOT DEPRIVE HIM OF HIS RIGHT TO INCLUDE OR EXCLUDE SUCH TAXES, AT HIS OPTION.

UNDER THIS INTERPRETATION OF SECTION 1-13 OF THE SPECIFICATIONS OF THE ABOVE-NUMBERED CONTRACT, THE ADMINISTRATION PROPOSES TO ISSUE THE REQUESTED TAX EXEMPTION CERTIFICATES TO THE CONTRACTOR. YOUR APPROVAL OF THIS ACTION IS REQUESTED.

IT MAY BE PROPER TO POINT OUT IN THE BEGINNING THAT THE SUBMISSION OF THIS MATTER BY THE CHIEF, ACCOUNTING DIVISION OF THE ADMINISTRATION, WAS NOT IN CONFORMITY WITH ESTABLISHED PROCEDURE, QUESTIONS OF THE CHARACTER HERE PRESENTED BEING PROPERLY FOR SUBMISSION BY THE HEAD OF THE DEPARTMENT CONCERNED TO THE COMPTROLLER GENERAL OF THE UNITED STATES, RATHER THAN BY AN EMPLOYEE OF A DEPARTMENT TO A DIVISION OF THE GENERAL ACCOUNTING OFFICE.

IT APPEARS FROM THE CORRESPONDENCE QUOTED ABOVE THAT THE ADMINISTRATION, NOTWITHSTANDING THE PROVISIONS IN PARAGRAPH 2 THAT " THE PRICES HEREIN DO NOT INCLUDE ANY FEDERAL TAXES FROM WHICH EXEMPTION IS GRANTED * * *" ETC., AT FIRST REJECTED THE REQUEST OF THE CONTRACTOR FOR TAX EXEMPTION CERTIFICATES ON THE GROUND THAT PARAGRAPH 1 WAS FOR APPLICATION, AND THAT ISSUANCE OF TAX EXEMPTION CERTIFICATES "WOULD, IN EFFECT, BE INCREASING THE BID PRICE ON THE TRUCKS AFTER THE AWARD HAD BEEN MADE" WHICH "WOULD BE DECIDEDLY UNFAIR TO OTHER BIDDERS AND WOULD OPERATE TO RESTRICT FREE AND OPEN COMPETITION REQUIRED BY LAW; " THAT IN ITS LETTER OF JULY 23, 1940, THE ADMINISTRATION STATED THAT WHILE THE TWO STATEMENTS RELATIVE TO FEDERAL TAXES WERE "CONFLICTATORY" THE CONTRACTOR HAD NOT STATED ELSEWHERE IN HIS BID ANY EXCEPTION TO THE BID PRICES---

* * * NOR STATED THAT TAX EXEMPTION CERTIFICATES WOULD BE CLAIMED IN CONNECTION WITH THIS TRANSACTION. THE AWARD WAS THEREFORE MADE UNDER THE ASSUMPTION THAT SUCH TAXES AS WERE IMPOSED BY LAW WERE INCLUDED IN THE BID. THIS OFFICE CANNOT RECOMMEND THE ISSUANCE OF THE TAX-EXEMPTION CERTIFICATES AS REQUESTED BY THE CONTRACTOR * * * AND THAT AFTER THE MATTER WAS "GIVEN FURTHER CONSIDERATION" BY THE ADMINISTRATION--- APPARENTLY EXTENDING OVER THE PERIOD FROM RECEIPT OF THE LETTER OF AUGUST 22, 1940, FROM THIS OFFICE TILL JANUARY 9, 1941--- THE CONCLUSION WAS REACHED THERE WAS "STRONG JUSTIFICATION" FOR THE ISSUANCE OF THESE CERTIFICATES BY THE ADMINISTRATOR; AND THAT IT NOW IS PROPOSED TO ISSUE TAX-EXEMPTION CERTIFICATES ON THE GROUND THAT THERE WAS NO INCONSISTENCY OR CONFLICT IN THE TWO PROVISIONS RELATIVE TO FEDERAL AND OTHER TAXES; THAT THE MANUFACTURERS' EXCISE TAX WAS NOT "APPLICABLE" TO VEHICLES TO BE SOLD FOR THE EXCLUSIVE USE OF THE UNITED STATES; THAT SECTIONS 3442-3443, INTERNAL REVENUE CODE,"PROVIDE THAT THE MANUFACTURER'S EXCISE TAX IS NOT APPLICABLE TO MOTOR VEHICLES FOR THE EXCLUSIVE USE OF THE UNITED STATES, THAT SUCH VEHICLES ARE EXEMPT FROM SUCH TAX; " THAT PARAGRAPH 2 OF SECTION 1-13 "WAS AN AFFIRMATIVE STATEMENT ON THE FACE OF THE BID THAT SUCH TAXES WERE EXCLUDED FROM THE BID PRICE, AND IT WAS, THEREFORE, UNNECESSARY FOR THE BIDDER TO INCLUDE ANY ADDITIONAL STATEMENT TO THE SAME EFFECT; " AND THAT " HE WAS NOT INVITED TO MAKE A STATEMENT AS TO WHETHER OR NOT SUCH TAXES WERE DEDUCTED FROM OR INCLUDED IN HIS BID PRICE.'

THE ARGUMENT THAT THE TWO PARAGRAPHS IN QUESTION WERE NOT IN CONFLICT, OR TO SAY THE LEAST CONFUSING, WOULD APPEAR TO BE SUFFICIENTLY REBUTTED BY THE MANIFEST ADMINISTRATIVE CONFUSION AND DOUBT IN THE MATTER AS NOW INDICATED BY THE RECORD. THE FACT IS THAT THE TWO PARAGRAPHS WERE IN CONFLICT, FOR THE FIRST STATED THAT THE PRICE PAID INCLUDED ANY FEDERAL TAX THERETOFORE IMPOSED BY THE CONGRESS WHICH WAS APPLICABLE TO THE MATERIAL IN THE BID, WHILE THE SECOND PARAGRAPH STATED, IN EFFECT, THAT THE PRICES PAID DID NOT INCLUDE CERTAIN FEDERAL TAXES THERETOFORE IMPOSED BY THE CONGRESS, NOR ANY TAX IMPOSED BY A STATE, COUNTY OR MUNICIPALITY "UPON THE TRANSACTION OF THIS PROCUREMENT OF THESE MATERIALS.' THE FEDERAL EXCISE TAXES HAD BEEN IMPOSED BY THE CONGRESS BEFORE THE INVITATION WAS ISSUED AND WERE APPLICABLE TO "SALE OF THE SUPPLIES COVERED BY THIS BID"--- TRUCKS. PARAGRAPH 1 WAS THE FEDERAL TAX PROVISION INCORPORATED IN AN APPROVED STANDARD GOVERNMENT FORM OF CONTRACT AND, AS SUCH, WAS NOT SUBJECT TO ADMINISTRATIVE CHANGE OR MODIFICATION WITHOUT PREVIOUS AUTHORIZATION FROM THE PROPER GOVERNMENT SOURCE--- NOW THE PROCUREMENT DIVISION OF THE TREASURY DEPARTMENT. THE INCLUSION OF PARAGRAPH 2 HAD NO WARRANT IN LAW AND NO BASIS IN REASON, AND WAS CLEARLY IN CONTRAVENTION OF NUMEROUS DECISIONS OF THIS OFFICE.

THE ARGUMENT THAT PARAGRAPH 2 WAS NOT IN CONFLICT WITH PARAGRAPH 1 ON THE THEORY THAT THE FEDERAL EXCISE TAX WAS NOT "APPLICABLE" TO THE VEHICLES INVOLVED IS NOT TENABLE, FOR IT PROCEEDS UPON A FALSE PREMISE. SECTION 401 OF THE REVENUE ACT OF AUGUST 30, 1935, FROM WHICH SECTIONS 3442 AND 3443 OF THE INTERNAL REVENUE CODE, TITLE 26, U.S.C., DERIVE, HEREINAFTER CALLED REVENUE ACT, IS NOT SELF-EXECUTING. THAT IS TO SAY, THE STATUTE DOES NOT EX PROPRIO VIGORE OPERATE AS AN EXEMPTION FROM THE TAX OF ARTICLES OR MATERIALS SOLD FOR THE EXCLUSIVE USE OF THE GOVERNMENT. THE CONTRARY, THE STATUTE IMPOSES CERTAIN CONDITIONS PRECEDENT, COMPLIANCE WITH WHICH IS ESSENTIAL TO THE RIGHT OF THE CONTRACTOR OR MANUFACTURER TO OBTAIN OR RECEIVE ANY EXEMPTION FROM, CREDIT FOR, OR REFUND OF THE APPLICABLE EXCISE TAX, AND UNLESS AND UNTIL THOSE CONDITIONS ARE MET, INCLUDING COMPLIANCE WITH THE REGULATIONS ISSUED PURSUANT TO THE STATUTE BY THE COMMISSIONER OF INTERNAL REVENUE WITH THE APPROVAL OF THE SECRETARY OF THE TREASURY, THERE IS NO EXEMPTION FROM THE TAX WHICH, UNTIL SUCH TIME, CONTINUES TO BE AS APPLICABLE TO GOVERNMENT SALES AS TO ANY OTHERS, THE WHOLE MATTER OF EXEMPTION BEING ENTIRELY CONTINGENT AND CONDITIONAL.

IF IT BE CONCEDED THAT PARAGRAPH 2 "WAS AN AFFIRMATIVE STATEMENT ON THE FACE OF THE BID THAT SUCH TAXES WERE EXCLUDED FROM THE BID PRICE" IT WAS AN AFFIRMATIVE STATEMENT OF THE PURCHASING AGENCY AND OPERATED AS AN ADMINISTRATIVE PREDETERMINATION AND REQUIREMENT THAT A BIDDER MUST EXCLUDE THE MANUFACTURER'S EXCISE TAX AS WELL AS CERTAIN OTHER TAXES FROM HIS BID AS A PREREQUISITE TO OFFERING HIS GOODS TO THE GOVERNMENT. THE SUGGESTION THAT "IF HE HAD MADE AN AFFIRMATIVE RECITATION THAT SUCH TAXES WERE INCLUDED IN THE BID PRICE, IT WOULD HAVE FURNISHED NO GROUND FOR REJECTION OF THE BID, SINCE THE FORM OF THE INVITATION COULD NOT DEPRIVE HIM OF HIS RIGHT TO INCLUDE OR EXCLUDE SUCH TAXES, AT HIS OPTION" IS WITHOUT FORCE. WHILE IT HAS BEEN HELD IN DECISIONS OF THIS OFFICE THAT BIDDERS MUST BE LEFT AT LIBERTY TO SUBMIT BID PRICES EITHER INCLUSIVE OR EXCLUSIVE OF THE EXCISE TAX AT THEIR OPTION, IN THIS INSTANCE--- IF EFFECT BE GIVEN TO THE SECOND RATHER THAN TO THE FIRST PARAGRAPH OF THE TAX PROVISIONS--- THE ADMINISTRATION IMPOSED THE CONDITION THAT THE BIDS MUST BE EXCLUSIVE, REGARDLESS OF THE BIDDER'S RIGHTS, AND IT WAS NOT TO BE EXPECTED THAT, IN THE FACE OF SUCH AN EXPRESS REQUIREMENT, A BIDDER WOULD UNDERTAKE AN AFFIRMATIVE SHOWING TO THE CONTRARY, THUS RENDERING HIS BID UNRESPONSIVE TO THE INVITATION. MOREOVER, BIDDERS ARE NOT TO BE REQUIRED TO MAKE AN "AFFIRMATIVE RECITATION" THAT THE EXCISE TAX IS INCLUDED IN THE BID PRICE, SUCH INCLUSION BEING PRESUMED IN THE ABSENCE OF AN AFFIRMATIVE STATEMENT OF EXCLUSION. 16 COMP. GEN. 1095; 17 ID. 992; ID. 1039; 18 ID. 465.

PARAGRAPH 2 PROVIDED, ALSO, THAT SUBMITTED PRICES DID NOT INCLUDE ANY TAX IMPOSED BY A STATE, COUNTY OR MUNICIPALITY UPON THE TRANSACTION. THE REVENUE ACT HAS EXCLUSIVE REFERENCE TO FEDERAL EXCISE TAXES IMPOSED THEREUNDER. IN THIS CONNECTION, IT IS NOT SHOWN WHETHER THE TAX EXEMPTION CERTIFICATES WHICH THE ADMINISTRATION NOW PROPOSES TO FURNISH TO THE CONTRACTOR APPLY TO ANY AND ALL STATE, COUNTY AND/OR MUNICIPAL TAXES APPLICABLE TO THE TRANSACTION. SINCE PARAGRAPH 2 HAD EQUAL REFERENCE TO THE EXCLUSION OF SUCH TAXES, IT WOULD APPEAR TO FOLLOW AS A NECESSARY CONSEQUENCE THAT IF THAT PARAGRAPH IS TO BE MADE THE BASIS FOR ISSUANCE OF A FEDERAL EXCISE TAX EXEMPTION CERTIFICATE, IT MUST BE ACCEPTED AS "AN AFFIRMATIVE STATEMENT ON THE FACE OF THE BID" THAT APPLICABLE STATE AND LOCAL TAXES, IF ANY, ALSO WERE EXCLUDED, AND THAT THE CONTRACTOR WOULD BE ENTITLED TO TAX EXEMPTION CERTIFICATES COVERING SUCH STATE AND LOCAL TAXES.

THE WHOLE DIFFICULTY HERE PRESENTED WOULD APPEAR TO BE A CONFUSION ADMINISTRATIVELY CREATED BY A FAILURE OF THE ADMINISTRATION TO FOLLOW THE LAW AND APPLICABLE DECISIONS OF THIS OFFICE. IN A DECISION OF MAY 26, 1938, 17 COMP. GEN. 992, TO YOU, THERE WERE COLLATED NUMEROUS EARLIER DECISIONS INVOLVING QUESTIONS RELATIVE TO FEDERAL EXCISE TAXES UNDER THE REVENUE ACT AND YOU WERE INFORMED THAT SINCE THE PROVISIONS OF THE ACT WERE PERMISSIVE RATHER THAN MANDATORY UPON A SELLER SO FAR AS SALES TO THE GOVERNMENT WERE CONCERNED, LEAVING HIM FREE TO OFFER HIS WARES TO THE GOVERNMENT AT PRICES EITHER INCLUSIVE OR EXCLUSIVE OF THE EXCISE TAX AS HE SAW FIT, ANY UNDERTAKING ON THE PART OF A PURCHASING AGENCY BY RULE, REGULATION, OR SPECIFICATION TO COERCE A BIDDER INTO BIDDING THE ONE WAY OR THE OTHER--- TO MAKE MANDATORY WHAT THE CONGRESS HAD LEFT DISCRETIONARY --- WAS AN UNAUTHORIZED ASSUMPTION OF AUTHORITY AND INFRINGED ALIKE UPON THE LAW AND THE RIGHTS OF BIDDERS. IT WAS THERE SAID:

UNDER THE LAW AS IT STANDS, NO PURCHASING AGENCY OF THE GOVERNMENT IS AUTHORIZED TO MAKE FEDERAL TAX EXCLUSION A CONDITION PRECEDENT TO CONSIDERATION OR ACCEPTANCE OF AN OTHERWISE PROPER BID, OR TO RESERVE TO ITSELF THE PREROGATIVE OF DEDUCTING THE AMOUNT OF APPLICABLE TAXES FROM A TAX-INCLUSIVE BID PRICE WITHOUT REGARD TO THE PREFERENCE OF THE BIDDER. IN OTHER WORDS, THERE APPEARS NO BASIS IN LAW FOR AN ADMINISTRATION UNDERTAKING TO ENLARGE THE SCOPE OF THE STATUTE BY MEANS OF AN ADMINISTRATIVE RULE OR REGULATION OR RESTRICTIVE REQUIREMENTS IN INVITATIONS FOR BIDS, THUS SEEKING TO MAKE MANDATORY UPON A BIDDER A COURSE OF ACTION WHICH UNDER THE PLAIN WORDING OF THE STATUTE CLEARLY IS VOLITIONAL. BIDDERS PROPERLY MAY BE REQUESTED BUT NOT REQUIRED TO SUBMIT PRICES EXCLUSIVE OF EXCISE TAX, AND ENCOURAGED BUT NOT COMPELLED TO SELL TO THE GOVERNMENT AT TAX-FREE PRICES. THAT IS THE FUNDAMENTAL PRINCIPLE INVOLVED AND APPEARS TO PRESENT THE CHIEF ADMINISTRATIVE DIFFICULTY AND CONFUSION IN YOUR DEPARTMENT.

IN AN EARLIER DECISION TO THE SECRETARY OF AGRICULTURE, 17 COMP. GEN. 615, 618-619, IT WAS STATED.

* * * BUT, AS POINTED OUT ABOVE, THE PROVISIONS OF THE REVENUE ACT OF 1932, AS AMENDED, RELATIVE TO TAX EXEMPTION ON SALES FOR EXCLUSIVE GOVERNMENT USE ARE NOT MANDATORY AND LEAVE A BIDDER FREE TO INCLUDE OR EXCLUDE EXCISE TAXES AS HE MAY SEE FIT. WHILE IT MAY BE DESIRABLE FROM AN ADMINISTRATIVE STANDPOINT TO MAKE PURCHASES EXCLUSIVE OF THE AMOUNT OF THE APPLICABLE TAXES, THERE APPEARS NO LEGAL AUTHORITY FOR THE ADOPTION BY ANY PURCHASING AGENCY OF THE GOVERNMENT OF ANY RULE, REGULATION, OR PROCEDURE, THE EFFECT OF WHICH IS TO REQUIRE OR INDIRECTLY COERCE BIDDERS TO SUBMIT FEDERAL-TAX-FREE PRICES, OR TO CONSENT TO THE DEDUCTION OF SUCH INCLUDED TAXES FROM OTHERWISE ACCEPTABLE LOW PRICES SUBMITTED. SUCH AN UNDERTAKING IS NOT WITHIN THE FRAMEWORK OF THE LEGISLATIVE POLICY WHICH THE STATUTE DISCLOSES AND, HENCE, IS UNAUTHORIZED. * * *

THE ABOVE QUOTED EXCERPTS FROM DECISIONS OF THIS OFFICE WERE A CORRECT EXPOSITION OF THE LAW, AND IT IS TO BE PRESUMED THAT THE ADMINISTRATION WAS FULLY AWARE OF THE SENSE OF THOSE DECISIONS AT AND BEFORE THE TIME THE INVITATION FOR BIDS HERE INVOLVED WAS ISSUED, SINCE CONTRACTING OFFICERS ARE PRESUMED TO KNOW THE STATUTORY REQUIREMENTS RELATIVE TO GOVERNMENT PURCHASES AND THE PERTINENT DECISIONS OF THIS OFFICE. 5 COMP. GEN. 835.

THE POSITIVE STATEMENT, WITHOUT QUALIFICATION, IN PARAGRAPH 2 THAT THE PRICES BID DID NOT INCLUDE FEDERAL TAXES FROM WHICH EXEMPTION WAS GRANTED, ETC., WAS AN ADMINISTRATIVE DECLARATION TO BIDDERS THAT PRICES WERE TO BE SUBMITTED ON THAT BASIS, LEAVING THE BIDDER NO CHOICE IN THE MATTER, AND SO WAS CONTRARY TO WELL ESTABLISHED PRINCIPLES OF LAW. AS SAID IN COOMBE V UNITED STATES, 3 FED. (2D) 714, 715:

WHEN AN ENACTMENT CLEARLY EXPRESSES THE LEGISLATIVE INTENT, THE COURTS AND ADMINISTRATIVE OFFICIALS HAVE NO RIGHT TO AMEND IT BY LIMITING OR EXTENDING ITS SCOPE. AN ENACTMENT COUCHED IN PLAIN, UNAMBIGUOUS LANGUAGE IS PRESUMED TO EXPRESS THE FULL INTENTION OF THE LEGISLATURE, AND TO MEAN NOTHING MORE AND NOTHING LESS THAN JUST WHAT IT SAYS OR NECESSARILY IMPLIES. * * * TO HOLD OTHERWISE WOULD SIMPLY PAVE THE WAY FOR THE USURPATION OF FUNCTIONS WHICH BELONG EXCLUSIVELY TO THE LEGISLATIVE DEPARTMENT OF THE GOVERNMENT.

THE RULE THUS STATED APPEARS PECULIARLY APPOSITE HERE FOR THE ENACTMENT IS COUCHED IN PLAIN, UNAMBIGUOUS LANGUAGE, AND NEITHER EXPRESSLY NOR BY NECESSARY OR EVEN REMOTE OR REASONABLE IMPLICATION DOES IT VEST ANY ADMINISTRATIVE DEPARTMENT OR INDEPENDENT ESTABLISHMENT OR ANY AGENCY, OFFICER, OR EMPLOYEE THEREOF WITH AUTHORITY TO REQUIRE THAT SALES THERETO MUST BE MADE TAX FREE. SUCH UNDERTAKING TO EXTEND THE SCOPE OF THE STATUTE BY IMPLICATION, PRESUMPTION, OR CONSTRUCTION, CLEARLY IS "THE USURPATION OF FUNCTIONS WHICH BELONG EXCLUSIVELY TO THE LEGISLATIVE DEPARTMENT OF THE GOVERNMENT," AND THIS IS THE CASE IRRESPECTIVE OF THE MOTIVE OR PURPOSE WHICH MAY PROMPT SUCH ACTION.

DECISIONS OF THIS OFFICE HAVE BEEN CONSISTENTLY TO THE EFFECT THAT IN THE ABSENCE OF AN AFFIRMATIVE SHOWING ON THE FACE OR IN THE BODY OF THE SUBMITTED BID THAT THE EXCISE TAX IMPOSED BY THE REVENUE ACT HAS BEEN EXCLUDED, SAID TAX IS PRESUMED TO BE INCLUDED; THAT NO INQUIRY RELATIVE THERETO AFTER BIDS ARE OPENED IS REQUIRED OR AUTHORIZED; THAT BIDS ARE FOR CONSIDERATION AND EVALUATION AS SUBMITTED AND FOR ACCEPTANCE OR REJECTION AS THE CASE MAY BE ON THAT BASIS; THAT UPON ACCEPTANCE THE BID PRICE IS THE CONTRACT PRICE; AND THAT NO EX POST FACTO STATEMENT OF A CONTRACTOR THAT THE PRICES SUBMITTED ACTUALLY WERE EXCLUSIVE OF THE SAID TAX MAY BE ACCEPTED AS JUSTIFYING, OR MADE THE BASIS FOR THE ISSUANCE OF TAX EXEMPTION CERTIFICATES. 15 COMP. GEN. 1030; 16 ID. 1021; ID. 1054; ID. 1095; 17 ID. 992; ID. 1039; 18 ID. 465. BUT THOSE DECISIONS APPEAR TO HAVE INVOLVED AND CONSIDERED CASES WHERE THE INVITATIONS FOR BIDS AS ISSUED BY THE PURCHASING AGENCY WERE IN CONFORMITY WITH LAW AND IN LINE WITH DECISIONS OF THIS OFFICE, IN THAT THEY INCLUDED EXCISE TAX QUESTIONNAIRES IN WHICH BIDDERS NOT ONLY WERE AFFORDED AN OPPORTUNITY, BUT WERE INSTRUCTED TO SHOW AFFIRMATIVELY WHETHER SUCH TAXES WERE INCLUDED OR EXCLUDED, THE AMOUNT SO EXCLUDED (OR SO INCLUDED IN THE EVENT THE BIDDER WAS WILLING TO HAVE THE AMOUNT INCLUDED DEDUCTED FROM THE BID PRICE AND TO ACCEPT TAX EXEMPTION CERTIFICATES IN LIEU THEREOF), CF. 17 COMP. GEN. 615, 617, AND WHETHER CREDIT, EXEMPTION, OR REFUND WOULD OR WOULD NOT BE REQUESTED, AND IN WHICH THE BIDDER THROUGH INADVERTENCE, NEGLIGENCE OR OTHERWISE, FAILED TO FURNISH THE REQUIRED INFORMATION, AND AT A LATER DATE ASSERTED THAT THE TAX HAD BEEN EXCLUDED AND REQUESTED ISSUANCE OF EXEMPTION CERTIFICATES. IN THOSE CASES THE WHOLE RESPONSIBILITY WAS THAT OF THE BIDDER-CONTRACTOR, HERE THE ADMINISTRATIVE AGENCY INVOLVED DID NOT FOLLOW THE LAW OR THE PROPER PRACTICE, DID NOT INCLUDE IN THE INVITATION AN EXCISE TAX QUESTIONNAIRE, THE BIDDER WAS NEITHER REQUIRED NOR AFFORDED OPPORTUNITY IN THE INVITATION TO GIVE ANY VOLUNTARY INFORMATION AS TO THE INCLUSION OR EXCLUSION OF TAXES OR THE AMOUNT THEREOF, TO EXPRESS ITS WILLINGNESS TO HAVE THE AMOUNT OF ANY TAX INCLUDED DEDUCTED AND TO ACCEPT TAX EXEMPTION CERTIFICATE INSTEAD, OR TO STATE WHETHER, IF THE TAX WAS EXCLUDED, IT WOULD REQUIRE AN EXEMPTION CERTIFICATE FOR THE PURPOSE OF OBTAINING CREDIT, EXEMPTION OR REFUND, AND TO ALL INTENTS AND PURPOSES WAS GIVEN NO ALTERNATIVE TO SUBMITTING TAX-FREE PRICES--- THE UNQUALIFIED STATEMENT IN PARAGRAPH 2 BEING EQUIVALENT TO AN ADMINISTRATIVE DEMAND TO THAT EFFECT. THE BIDDER TOOK NO EXCEPTION, BUT MERELY SIGNED THE BID IN THE FORM PREPARED BY THE ADMINISTRATION, RECEIVED THE CONTRACT, DELIVERED THE TRUCKS, AND THEREAFTER MADE DEMAND FOR EXEMPTION CERTIFICATES. SINCE THE BIDDER TOOK NO EXCEPTION TO PARAGRAPH 2, THERE WOULD BE A PRESUMPTION THAT THE BID WAS IN CONSONANCE THEREWITH, BUT CERTAINLY THE PRESENT RECORD DISCLOSES NO OTHER AFFIRMATIVE EVIDENCE THAT THE AMOUNT OF THE EXCISE TAX, AS SUCH, ACTUALLY WAS EXCLUDED FROM THE BID PRICE AND NO STATEMENT BY THE CONTRACTOR TO THAT EFFECT OTHER THAN THAT ADMINISTRATIVELY INSERTED IN THE INVITATION FOR BIDS. IN ITS LETTER OF JUNE 20, 1940, THE CONTRACTOR REQUESTED COMPLETION AND RETURN OF EXEMPTION CERTIFICATE FORMS ENCLOSED THEREWITH, WHILE ITS LETTER OF JULY 19, 1940, MERELY QUOTED PARAGRAPH 2 AND CONCLUDED THAT " SINCE GOVERNMENT TRUCK PURCHASES ARE SUBJECT TO EXCISE TAX EXEMPTION, WE ASK THAT YOU KINDLY COMPLETE FEDERAL FORM NO. 1094 FOR BOTH THE FWB TRUCKS PURCHASED ON IBP 998 AND IBP-1013.'

THE FAULT AND RESPONSIBILITY IN THIS CASE WOULD APPEAR TO REST WITH THE ADMINISTRATION AND TO BE DIRECTLY ATTRIBUTABLE TO ITS IMPROPER PROCEDURE IN ADVERTISING FOR BIDS WITH THE INCLUSION OF THE UNAUTHORIZED PARAGRAPH. HOWEVER, IF IT BE ADMINISTRATIVELY DETERMINED, NOTWITHSTANDING THE REVERSAL OF THE ATTITUDE OF THE ADMINISTRATION, TO ISSUE A TAX EXEMPTION CERTIFICATE, IT WOULD APPEAR PROPER TO REQUIRE, AT LEAST, A POSITIVE STATEMENT IN THE FORM OF AN AFFIDAVIT FROM A RESPONSIBLE OFFICER OF THE CONTRACTOR COMPANY, OR OTHER CONVINCING EVIDENCE, THAT THE FEDERAL EXCISE TAX, AS SUCH, WAS IN FACT EXCLUDED FROM THE BID PRICE AS REQUIRED BY PARAGRAPH 2 OF THE SPECIFICATIONS.

FOR THE REASONS HEREIN AND HERETOFORE ASSIGNED THE PRACTICE OF INCLUDING PARAGRAPH 2 OF THE SPECIFICATIONS HERE IN QUESTION IN INVITATIONS FOR BIDS COVERING PURCHASES FOR GOVERNMENT USE SHOULD BE DISCONTINUED AND, IN LIEU THEREOF, THERE WOULD BE FOR INCLUSION A SUITABLE EXCISE TAX QUESTIONNAIRE IN LINE WITH THIS AND FORMER DECISIONS OF THIS OFFICE.