107. LIENS AND FRAUDULENT TRANSFERS.

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(b) The provisions of section 96 of this title to the contrary notwithstanding, * * * statutory liens for taxes and debts owing to the United States or any State or subdivision thereof, created or recognized by the laws of the United States or of any State, may be valid against the trustee, even though arising or perfected while the debtor is insolvent and within four months prior to the filing of the petition in bankruptcy or of the original petition under chapter 10, 11, 12, or 13 of this title, by or against him. Where by such laws such liens are required to be perfected and arise but are not perfected before bankruptcy, they may nevertheless be valid, if perfected within the time permitted by and in accordance with the requirements of such laws, except that if such laws require the liens to be perfected by the seizure of property, they shall instead be perfected by filing notice thereof with the court.

(c) Where not enforced by sale before the filing of a petition in bankruptcy or of an original petition under chapter 10, 11, 12, or 13 of this title, though valid under subdivision (b) of this section, statutory liens, including liens for taxes or debts owing to the United States or to any State or subdivision thereof, on personal property not accompanied by possession of such property, and liens whether statutory or not, of distress for rent shall be postponed in payment to the debts specified in clauses (1) and (2) of subdivision (a) of section 104 of this title, and except as against other liens, such liens for wages or for rent shall be restricted in the amount of their payment to the same extent as provided for wages and rent respectively in subdivision (a) of section 104 of this title.

(July 1, 1898, c. 541, § 67, 30 Stat. 564; June 22, 1938, c. 575, § 1, 52 Stat. 876-877.) $205. REORGANIZATION OF RAILROADS ENGAGED IN INTERSTATE COMMERCE.

(m) "Railroad corporation" and "person" defined.

The term "railroad corporation" as used in this section means any common carrier by railroad engaged in the transportation of persons or property in interstate commerce, except a street, a suburban, or interurban electric railway which is not operated as a part of a general railroad system of transportation or which does not derive more than 50 per centum of its operating revenues from the transportation of freight in standard steam railroad freight equipment. Wherever used in this section the term "person" shall include an individual, corporation, partnership, association, joint-stock company, unincorporated organization, or a government or political subdivision thereof.

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(r) Separability clause.

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If any provision of this section, or the application thereof to any person or circumstances, is held invalid, the remainder of this section, or application of such provision to other persons or circumstances, shall not be affected thereby.

(July 1, 1898, c. 541, § 77, as added Mar. 3, 1933, c. 204, § 1, 47 Stat. 1474, and amended Aug. 27, 1935, c. 774, 49 Stat. 911; June 26, 1936, c. 833, 49 Stat. 1969.)

506. IN GENERAL.

Chapter 10.—Corporate Reorganizations

For the purposes of this chapter, unless inconsistent with the context

(3) "Corporation" shall mean a corporation, as defined in this title, which could be adjudged a bankrupt under this title, and any railroad corporation excepting a railroad corporation authorized to file a petition under section 205 of this title; * * * (July 1, 1898, c. 541, § 106, as added June 22, 1938, c. 575, § 1, 52 Stat. 883.)

§ 667. TAXES; EXEMPTION FROM STAMP TAXES.

The issuance, transfer, or exchange of securities, or the making or delivery of instruments of transfer under any plan confirmed under this chapter, shall be exempt from any stamp taxes now or hereafter imposed under the laws of the United States or of any State. (July 1, 1898, c. 541, § 267, as added Jun 22, 1938, c. 575, § 1, 52 Stat. 903.)

§ 669. SAME; PLAN TO AVOID TAXES; OBJECTION TO CONFIRMATION.

Where it appears that a plan has for one of its principal purposes the avoidance of taxes, objection to its confirmation may be made on that ground by the Secretary of the Treasury, or, in the case of a State, by the corresponding official or other person so authorized. Such objections shall be heard and determined by the judge, independently of other objections which may be made to the confirmation of the plan, and, if the judge shall be satisfied that such purpose exists, he shall refuse to confirm the plan. (July 1, 1898, c. 541, § 269, as added June 22, 1938, c. 575, § 1, 52 Stat. 904.)

§ 671. SAME; ASSESSMENT AND PAYMENT OR ACCEPTANCE OF PLAN BY TAXING

AGENCY.

Any provision in this chapter to the contrary notwithstanding, all taxes which may be found to be owing to the United States or any State from a debtor within one year from the date of the filing of a petition under this chapter and have not been assessed prior to the date of the confirmation of a plan under this chapter, and all taxes which may become owing to the United States or any State from a receiver or trustee of a debtor or from a debtor in possession, shall be assessed against, may be collected from, and shall be paid by the debtor or the corporation organized or made use of for effectuating a plan under this chapter: Provided, however, That the United States or any State may in writing accept the provisions of any plan dealing with the assumption, settlement, or payment of any such tax. (July 1, 1898, c. 541, § 271, as added June 22, 1938, c. 575, § 1, 52 Stat. 904.)

Chapter 13.-Wage Earners' Plans

{1080. TAXES; PAYMENT; ACCEPTANCE OF ARRANGEMENT BY TAXING AGENCY. Any provision in this chapter to the contrary notwithstanding, all taxes which may be found to be owing to the United States or any State from a debtor within one year from the date of the filing of a petition under this chapter, and have not been assessed prior to the date of the confirmation of a plan under this chapter, and all taxes which may become owing to the United States or any State from a debtor shall be assessed against, may be collected from, and shall be paid by the debtor: Provided, however, That the United States or any State may in writing accept the provisions of any plan dealing with the assumption, settlement, or payment of any such tax. (July 1, 1898, c. 541, § 680, as added June 22, 1938, c. 575, § 1, 52 Stat. 938.)

TITLE 12.—BANKS AND BANKING

484. LIMITATION ON VISITORIAL POWERS.

No bank shall be subject to any visitorial powers other than such as are authorized by law, or vested in the courts of justice or such as shall be or shall have been exercised or directed by Congress, or by either House thereof or by any Committee of Congress or of either House duly authorized. (R. S. § 5240; Feb. 19, 1875, c. 89, 18 Stat. 329; Dec. 23, 1913, c. 6, § 21, 38 Stat. 271.)

FEDERAL RESERVE BANKS

{531. EXEMPTION FROM TAXATION.

Federal reserve banks, including the capital stock and surplus therein and the income derived therefrom, shall be exempt from Federal, State, and local taxation, except taxes upon real estate. (Dec. 23, 1913, c. 6, § 7, 38 Stat. 258; Mar. 3, 1919, c. 101, § 1, 40 Stat. 1314.)

[But see section 742a of title 31.]

NATIONAL BANK CIRCULATION

1541. TAX ON CIRCULATING NOTES GENERALLY.

In lieu of all existing taxes, every association shall pay to the Treasurer of the United States, in the months of January and July, a duty of one-half of 1 per centum each half year upon the average amount of its notes in circulation. (R. S. § 5214; Mar. 3, 1883, c. 121, § 1, 22 Stat. 488.)

512. TAX ON CIRCULATING NOTES SECURED BY 2 PER CENTUM BONDS.

Every nat

bonds of t

king association having on deposit, as provided by law, es bearing interest at the rate of 2 per centum per annum,

issued under the provisions of this section, sections 51, 101, 177, and 178 of this title and sections 146, 313, 314, 320, 406, 408, 410, 411, 429, 455, and 751 of Title 31, to secure the circulating notes, shall pay to the Treasurer of the United States, in the months of January and July, a tax of one-fourth of 1 per centum each half year upon the average amount of such of its notes in circulation as are based upon the deposit of said 2 per centum bonds; and such taxes shall be in lieu of existing taxes on its notes in circulation imposed by section 541 of this title. (Mar. 14, 1900, c. 41, § 13, 31 Stat. 49.)

§ 543. TAX ON CIRCULATING NOTES SECURED BY PANAMA CANAL 2 PER CENTUM BONDS; BONDS TO HAVE ALL RIGHTS AND PRIVILEGES OF OTHER 2 PER CENTUM BONDS.

Every national banking association having on deposit, as provided by law, bonds issued under the provisions of section 8 of Act of June 28, 1902 (chapter 1302, Thirty-second Statute, page 484), to secure its circulating notes, shall pay to the Treasurer of the United States, in the months of January and July, a tax of one-fourth of 1 per centum each half year upon the average amount of such of its notes in circulation as are based upon the deposit of said 2 per centum bonds; and such taxes shall be in lieu of existing taxes on its notes in circulation imposed by section 541 of this title. (Dec. 21, 1905, c. 3, § 1, 34 Stat. 5.)

§ 544. HALF-YEARLY RETURN OF CIRCULATION.

In order to enable the Treasurer to assess the duties imposed by section 541 of this title, each association shall, within ten days from the 1st days of January and July of each year, make a return, under the oath of its president or cashier, to the Treasurer of the United States, in such form as the Treasurer may prescribe, of the average amount of its notes in circulation for the six months next preceding the most recent 1st day of January or July. Every association which fails so to make such return shall be liable to a penalty of $200, to be collected either out of the interest as it may become due such association on the bonds deposited with the Treasurer, or, at his option, in the manner in which penalties are to be collected of other corporations under the laws of the United States. (R. S. § 5215; Mar. 3, 1883, c. 121, § 1, 22 Stat. 488.)

§ 545. PENALTY FOR FAILURE TO MAKE RETURN.

Whenever any association fails to make the half-yearly return required by section 544 of this title the duties to be paid by such association shall be assessed upon the amount of notes delivered to such association, by the Comptroller of the Currency. (R. S. § 5216; Mar. 3, 1883, c. 121, § 1, 22 Stat. 488.)

§ 546. ENFORCING TAX ON CIRCULATION.

Whenever an association fails to pay the duties imposed by sections 541, 544, and 545 of this title, the sums due may be collected in the manner provided for the collection of United States taxes from other corporations; or the Treasurer may reserve the amount out of the interest, as it may become due, on the bonds deposited with him by such defaulting association. (R. S. § 5217.) § 547. REFUNDING EXCESS TAX.

In all cases where an association has paid or may pay in excess of what may be or has been found due from it, on account of the duty required to be paid to the Treasurer of the United States, the association may state an account therefor, which, on being certified by the Treasurer of the United States, and found correct by the General Accounting Office, shall be refunded in the ordinary manner by warrant on the Treasury. (R. S. § 5218; June 10, 1921, c. 18, § 304, 42 Stat. 24.)

Chapter 7.-Farm Credit Administration

§ 931. FEDERAL LAND BANKS; NATIONAL FARM LOAN ASSOCIATIONS; MORTGAGES

AND BONDS AS INSTRUMENTALITIES OF GOVERNMENT.

Every Federal land bank and every national farm loan association, including the capital and reserve or surplus therein and the income derived therefrom, shall be exempt from Federal, State, municipal, and local taxation, except taxes upon real estate held, purchased, or taken by said bank or association under the provisions of sections 761 and 781 of this title. First mortgages executed to Federal land banks, or to joint stock land banks, and farm-loan bonds issued under the provisions of this chapter, shall be deemed and held to be instrumentalities of the Government of the United States, and as such they and the income

derived therefrom shall be exempt from Federal, State, municipal, and local taxation. (July 17, 1916, c. 245, § 26, 39 Stat. 380.)

[But see section 742a of title 31.]

Subchapter II-A.—Federal Farm Mortgage Corporation

§1020f. EXEMPTIONS FROM TAXATION.

(a) The corporation, including its franchise, its capital, reserves, and surplus, and its income shall be exempt from all taxation now or hereafter imposed by the United States * * *

(b) Mortgages executed to the Land Bank Commissioner and mortgages held by the Corporation, and the credit instruments secured thereby, and bonds issued by the Corporation under the provisions of this subchapter, shall be deemed and held to be instrumentalities of the Government of the United States, and as such they and the income derived therefrom shall be exempt from Federal, State, municipal, and local taxation (except surtaxes, estate, inheritance, and gift taxes). (Jan. 31, 1934, c. 7, § 12, 48 Stat. 347; Feb. 26, 1934, c. 33, 48 Stat. 360.)

[But see section 742a of title 31.]

Subchapter III.-Federal Intermediate Credit Banks

§ 1111. CAPITAL AND INCOME; DEBENTURES INSTRUMENTALITIES OF GOVERNMENT. The privileges of tax exemption accorded under section 931 of this title shall apply also to each Federal intermediate credit bank, including its capital, reserve, or surplus, and the income derived therefrom, and the debentures issued under this subchapter shall be deemed and held to be instrumentalities of the Government and shall enjoy the same tax exemptions as are accorded farm-loan bonds in said section. (July 17, 1916, c. 245, § 210, as added Mar. 4, 1923, c. 252, § 2, 42

Stat. 1459.)

[But see section 742a of title 31.]

Subchapter VI.-Provisions Common To Production Credit Corporations, Production Credit Associations, Regional and Central Banks for Cooperatives

§ 1138c. TAX EXEMPTION; REALTY AND TANGIBLE PERSONALTY AS SUBJECT TO TAXATION; TERMINATION OF TAX EXEMPTION AFTER RETIREMENT OF GOVERN

MENT-OWNED STOCK.

The Central Bank for Cooperatives, and the Production Credit Corporations, Production Credit Associations, and Banks for Cooperatives, organized under this chapter, and their obligations, shall be deemed to be instrumentalities of the United States, and as such, any and all notes, debentures, bonds, and other such obligations issued by such banks, associations, or corporations shall be exempt both as to principal and interest from all taxation (except surtaxes, estate, inheritance, and gift taxes) now or hereafter imposed by the United States or by any State, Territorial, or local taxing authority. Such banks, associations, and corporations, their property, their franchises, capital reserves, surplus, and other funds, and their income shall be exempt from all taxation now or hereafter imposed by the United States or by any State, Territorial, or local taxing authority; except that any real property and any tangible personal property of such banks, associations, and corporations shall be subject to Federal, State, Territorial, and local taxation to the same extent as other similar property is taxed. The exemption provided herein shall not apply with respect to any Production Credit Association or its property or income after the stock held in it by the Production Credit Corporation has been retired, or with respect to the Central Bank for Cooperatives, or any Production Credit Corporation or Bank for Cooperatives or its property or income after the stock held in it by the United States has been retired. (June 16, 1933, c. 98, § 63, 48 Stat. 267.)

[But see section 742a of title 31.]

Chapter 11.-Federal Home Loan Banks

1433. EXEMPTION FROM TAXATION; OBLIGATIONS ACCEPTABLE AS CREDIT ON DEBT OF HOME OWNER.

Any and all notes, debentures, bonds, and other such obligations issued by any bank, and consolidated Federal Home Loan Bank bonds and debentures, The Federal Farm Mortgage Corporation.

shall be exempt both as to principal and interest from all taxation (except surtaxes, estate, inheritance, and gift taxes) now or hereafter imposed by the United States * * *. The bank, including its franchise, its capital, reserves, and surplus, its advances, and its income, shall be exempt from all taxation now or hereafter imposed by the United States (July 22, 1932, c. 522, § 13,

* * *

47 Stat. 735; May 28, 1935, c. 150, § 8, 49 Stat. 295.)

[The banks referred to are undoubtedly the Federal Home Loan Banks; see also section 742a of title 31.]

Chapter 12.-Home Owners' Loan Corporation; Federal Savings and Loan Associations

Such associations, including their franchises, capital, reserves, and surplus, and their loans and income, shall be exempt from all taxation now or hereafter imposed by the United States (except the taxes imposed by sections 1410 and 1600 of Title 26 with respect to wages paid after December 31, 1939, for employment after such date), and all shares of such associations shall be exempt both as to their value and the income therefrom from all taxation (except surtaxes, estate, inheritance, and gift taxes) now or hereafter imposed by the United States * * *. * * * (June 13, 1933, c. 64, § 5, 48 Stat. 133; Aug. 10, 1939, c. 666, title IX, § 909, 53 Stat. 1402.)

[See also section 742a of title 31.]

§ 1768. TAXATION.

Chapter 14.-Federal Credit Unions

The Federal credit unions organized hereunder, their property, their franchises, capital, reserves, surpluses, and other funds, and their income shall be exempt from all taxation now or hereafter imposed by the United States or by any State, Territorial, or local taxing authority; except that any real property and any tangible personal property of such Federal credit unions shall be subject to Federal, State, Territorial, and local taxation to the same extent as other similar property is taxed. * * * (June 26, 1934, c. 750, § 18, 48 Stat. 1222; Dec. 6, 1937, c. 3, § 4, 51 Stat. 4.)

TITLE 15.-COMMERCE AND TRADE

§ 79k. SIMPLIFICATION OF HOLDING COMPANY SYSTEMS.

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(b) Limitations on operations of holding company systems.

It shall be the duty of the [Securities and Exchange] Commission, as soon as practicable after January 1, 1938:

(1) To require by order, after notice and opportunity for hearing, that each registered holding company, and each subisidary company thereof, shall take such action as the Commission shall find necessary to limit the operations of the holding-company system of which such company is a part to a single integrated public-utility system, and to such other businesses as are reasonably incidental, or economically necessary or appropriate to the operations of such integrated public-utility system: Provided, however, That the Commission shall permit a registered holding company to continue to control one or more additional integrated public-utility systems, if, after notice and opportunity for hearing, it finds that

(A) Each of such additional systems cannot be operated as an independent system without the loss of substantial economies which can be secured by the retention of control by such holding company of such system;

(B) All of such additional systems are located in one State, or in adjoining States, or in a contiguous foreign country; and

(C) The continued combination of such systems under the control of such holding company is not so large (considering the state of the art and the area or region affected) as to impair the advantages of localized management, efficient operation, or the effectiveness of regulation.

1 Federal savings and loan associations organized by the Federal Home Loan Bank Board.