liability to forfeiture of personal property, including carriers, seized as provided in § 172.25. Such action shall consist either of the acceptance or rejection of the offer.

[T.D. 6482, 25 F.R. 6757, July 16, 1960, as amended by T.D. 6866, 31 F.R. 14793, Nov. 30, 1966]

§ 172.44 Acquisition for official use and sale for account of petitioner in allowed petitions.

(a) Acquisition for official use. (1) The property or carrier may be purchased by the United States pursuant to agreement and retained for official use. Where the petitioner is the owner, the purchase price is the appraised value of the property or carrier less all costs. Where the petitioner is a creditor, the purchase price is whichever one of these amounts is the smaller: (i) The petitioner's equity, or (ii) the appraised value of the property or carrier less the amount of all costs.

In

(b) Sale for account of petitioner. (1) The petitioner may elect not to comply with the condition on which the property or carrier may be returned. this event, the Supervisor in Charge is authorized to sell it. Where the petitioner is the owner of the property or carrier, there is deducted from the proceeds of the sale all costs, and the Regional Commissioner pays to the petitioner, out of the proper appropriation, an amount equal to the balance, if any. Where the petitioner is a creditor, there is deducted from the proceeds of the sale all costs, and the Regional Commissioner pays to the petitioner, out of the proper appropriation, an amount equal to the balance, if any: Provided, That if the amount exceeds the amount of the equity, only the latter amount is paid to the petitioner.

[T.D. 6866, 30 F.R. 14793, Nov. 30, 1965] § 172.45 Re-appraisal of property involved in an allowed petition.

In determining the nature and extent of the relief to be afforded a petitioner pursuant to allowance of his petition, the value of the property or carrier involved in the allowed petition shall be considered to mean the value placed on said properly or carrier pursuant to official appraisal thereof immediately following seizure: Provided, however, That if the petitioner desires an up-to-date re-appraisal made of the property or carrier, after notification as to the terms of allowance of the petition, and makes

written request therefor, undertaking in said request to pay, or to be liable for, the total costs of such re-appraisal, the property or carrier shall be re-appraised officially in the same manner in which the original appraisal was made, and the terms and conditions of allowance shall stand modified to the extent required by such re-appraisal.

[T.D. 6866, 30 F.R. 14793, Nov. 30, 1965]

Subpart E-Appraisers Fees

§ 172.50 Rate of compensation.

Each appraiser selected under § 172.26 (a) (2) shall receive compensation of $3.00 per day for the performance of his duties in appraising property seized as subject to forfeiture under the internal revenue laws.

(68A Stat. 870; 26 U.S.C. 7325) [T.D. 6866, 30 F.R. 14793, Nov. 30, 1965]

Subpart F-Administrative Sale of Personal Property

§ 172.55

Alternative methods of sale.

When personal property or a carrier forfeited administratively may be sold, the Supervisor in Charge shall cause a notice of sale to be placed in a newspaper of general circulation published in the judicial district wherein the seizure was made. The sale shall not occur in less than 10 days from the date of the publication of the notice. At the discretion of the Supervisor in Charge, based upon which method in his sound judgment is most advantageous to the best interests of the United States, the forfeited personal property or carrier may be advertised for sale, and sold, at public auction to the highest bidder on open, competitive bids, or to the highest bidder on sealed, competitive bids. (68A Stat. 870; 26 U.S.C. 7325) 30 F.R. 14793, Nov. 30, 1965] § 172.56

[T.D. 6866,

All bids on unit basis.

All competitive bids, whether sealed or otherwise, shall be on a unit basis, 1. e. if a number of forfeited automobiles are advertised for sale at the same date, hour and place, whether or not in the same notice of sale, there shall be a separate, individual bid required as to each automobile, and it shall not be permissible to accept one blanket bid to cover the entire group of cars offered for sale. § 172.57 Conditions of sale.

(a) No recourse. All personal property and carriers to be sold shall be

offered for sale "as is" and without recourse against the United States.

(b) No guarantee. No guarantee or warranty, expressed or implied, shall be given or understood in respect of any forfeited property or carrier offered for sale.

(c) No sale. (1) The United States reserves the right to reject any and all bids received at public auction and in sealed, competitive bid sales.

(2) When "no sale" is declared for property other than cigars, cigarettes, and cigarette papers and tubes, the Supervisor in Charge shall re-advertise the property for sale.

(3) When "no sale" is declared for cigars, cigarettes, or cigarette papers or tubes, such property shall be destroyed or, if fit for human consumption, be given to a Federal or State hospital or institution.

(d) One bid. When only one bid is received for a single unit of property or a carrier offered at public auction or in a sealed, competitive bid sale, such bid shall be considered to be and treated as the highest bid received for that property or carrier.

[T.D. 6866, 30 F.R. 14793, Nov. 30, 1965] § 172.58 Terms of sale.

The terms of sale shall be cash in the amount of the accepted bid.

§ 172.59 Sale of forfeited cigars, cigarettes, and cigarette papers and tubes. All cigars, cigarettes, and cigarette papers and tubes shall be sold at a price which will include the tax due and payable thereon. Written, timely notice shall be given by the Supervisor in Charge to the manufacturer of any such forfeited articles offered for sale. [T.D. 6866, 30 F.R. 14793, Nov. 30, 1965] § 172.60 Purchaser entitled to bill of

sale. Each purchaser of administratively forfeited property, including carriers, shall be entitled to receive a suitable and authentic bill of sale on a form to be provided for the purpose. § 172.61

Sale on open, competitive bids. If the personal property or carrier is to be sold at public auction to the highest bidder on open, competitive bids, the notice of sale shall so specify, and state the date, hour, and place of sale. [TD. 6866, 30 F.R. 14793, Nov. 30, 1966]

§ 172.62 Sale on sealed, competitive bids.

If the property or carrier is to be sold to the highest bidder on sealed, competitive bids, the notice of sale shall so specify, and shall state the date, hour, and place of sale, and the date, hour, and place before the sale when and where the property, including carriers, may be viewed by prospective sealed bidders, and necessary information obtained. All sealed bids must be filed with the Supervisor in Charge before the sale. No bids will be accepted after the sale starts. At the appointed date, hour, and place of sale, all sealed bids timely filed shall be opened in the presence of all bidders attending the sale, who shall have the privilege of inspecting the bids if they so desire.

[T.D. 6866, 30 F.R. 14793, Nov. 30, 1965] Subpart G-Disposal of Forfeited or Abandoned Property

173.32 Notice and request by bottle manufacturer.

173.33 Indicia for domestic liquor bottles. 173.34 Indicia for imported liquor bottles. 173.35 Bottles manufactured with previously prescribed indicia.

173.36 Persons authorized to receive liquor bottles.

173.37 Shipment of liquor bottles for further processing.

173.38 Liquor bottles for testing purposes. 173.39 Manufacturer's records. 173.40

Discontinuance of business. 173.41 Possession of used liquor bottles. 173.42 Possession of refilled liquor bottles. 173.43 Refilling of liquor bottles.

AUTHORITY: The provisions of this Part 173 issued under 68A Stat. 895, 917, 72 Stat. 1314, 1373, 1374, 1402; 26 U.S.C. 5001, 5291, 5301, 5605, 5606, 7502, 7805, unless otherwise noted.

SOURCE: The provisions of this Part 173 contained in T.D. 6399, 24 F.R. 5830, July 22, 1959, unless otherwise noted.

Subpart A-Scope of Regulations § 173.1

Returns of substances, articles, or containers.

This part relates to the returns and records of the disposition of articles from which distilled spirits may be recovered, of substances of the character used in the manufacture of distilled spirits, and of containers of the character used for the packaging of distilled spirits; and to the manufacture and disposition of liquor bottles.

[33 F.R. 6812, May 4, 1968]

§ 173.2 Forms prescribed.

The Director is authorized to prescribe all forms required by this part, including demand letters, reports, and returns. Information called for shall be furnished in accordance with the instructions on the forms or issued in respect thereto.

[33 F.R. 6812, May 4, 1968]

Subpart B-Definitions

§ 173.5 Meaning of terms.

When used in this part and in forms prescribed under this part, where not otherwise distinctly expressed or manifestly incompatible with the intent thereof, terms shall have the meaning ascribed in this section. Words in the plural form shall include the singular, and vice versa, and words importing the masculine gender shall include the fem

inine. The terms "includes" and “including" do not exclude things not enumerated which are in the same general class.

Articles. Denatured spirits or any product or preparation which contains more than 25 percent by volume of denatured spirits.

Assistant Regional Commissioner. An assistant regional commissioner (alcohol and tobacco tax) who is responsible to, and functions under the direction and superivsion of, a regional commissioner.

Bottler. A proprietor of a distilled spirits plant authorized to bottle spirits, a proprietor of a class 8 bonded warehouse qualified under customs laws, or an agency of the United States or any State or political subdivision thereof.

CFR. The Code of Federal Regulations. Commissioner. The Commissioner of

Internal Revenue.

Container. Any receptacle, vessel, barrel, cask, keg, bottle, jug, can, or jar of the character used for the packaging of distilled spirits.

Demand letter. The "demand letter" is the formal requirement of the assistant regional commissioner that a person disposing of any article, container, or substance shall render a correct return.

Denatured spirits. Spirits to which denaturants have been added pursuant to formulas prescribed in Part 212 of this chapter.

Director. The Director, Alcohol and Tobacco Tax Division, Internal Revenue Service, Washington, D.C.

Dispose. "Dispose" and all forms of the word shall mean and include, but not by way of limitation, consign, sell, transfer, deliver, destroy, or lose, and all forms of those words.

Distilled spirits or spirits. That substance known as ethyl alcohol, ethanol, or spirits of wine, including all dilutions and mixtures thereof, from whatever source or by whatever process produced, and shall include whisky, brandy, rum, gin, and vodka and products produced in such manner that the person producing them is a rectifier within the meaning of section 5082 of the Internal Revenue Code of 1954, as amended.

Importer. A person authorized to import distilled spirits into the United States.

Internal revenue officer. An officer or employee of the Internal Revenue Service duly authorized to perform any function relating to the administration or enforcement of this part.

Liquor bottle. A bottle made of glass or earthenware, or of other suitable material approved by the Director, designed or intended for use as a container for distilled spirits for sale for beverage purposes.

Person. An individual, trust, estate, partnership, association, company, or corporation.

Region. An internal revenue region. Regional Commissioner. A regional commissioner of internal revenue.

Render. "Render" shall mean to deliver the completed return to the office indicated in the demand letter, not later than the date required by the demand letter, or to mail such completed return, in an envelope properly addressed and stamped, in sufficient time for such envelope to be postmarked by the Post Office Department not later than the date required by the demand letter. The time and date of the United States postmark shall constitute the time and date of delivery of the return to the designated office.

Substance.

The term "substance" shall mean and include, but not by way of limitation, any of the following: Any grade or type of sugar, sirup, or molasses derived from sugar cane, sugar beets, corn, sorghum, or any other source; starch; potatoes; grain, or corn meal, corn chops, cracked corn, rye chops, middlings, shorts, bran, or any other grain derivative; malt; malt sugar, or malt sirup; oak chips, charred or not charred; yeast; cider; honey; fruits; grapes; berries; fruit, grape, or berry juices or concentrates; wine; caramel; burnt sugar; gin flavor; Chinese bean cake or Chinese wine cake; urea; ammonium phosphate, ammonium carbonate, ammonium sulphate, or any other yeast food; ethyl acetate or any other ethyl ester; any other material of the charac ter used in the manufacture of distilled spirits, or any chemical or other material suitable for promoting or accelerating fermentation; any chemical or material of the character used for the production of distilled spirits by chemical reaction; or any combination of such materials or chemicals.

This chapter. Chapter I, Title 26, Code of Federal Regulations.

United States. The several States and the District of Columbia.

U.S.C. "U.S.C." shall mean the United States Code.

[T.D. 6399, 24 F.R. 5830, July 22, 1959, as amended by T.D. 6954, 33 F.R. 6812, May 4, 1968]

Subpart C-Requirement of Returns § 173.10 Returns required; substance and articles.

Every person in the United States who disposes of any substance or article, as defined in § 173.5, shall, when required by a demand letter issued by the assistant regional commissioner, and until notified to the contrary in writing by such officer, for the purpose of enabling the determination in accordance with law as to whether all taxes due with respect to any distilled spirits produced or recovered from such substances or articles have been paid, render in writing on Form 169 (or other form authorized by the assistant regional commissioner) for the periods specified in the demand letter, correct returns showing (a) the date of each disposition of such substances or articles, and in such quantities, as may be specified by the assistant regional commissioner in the demand letter; (b) the quantity and kind of each substance or article disposed of; (c) the name and complete address of each purchaser, consignee, and other person actually receiving such substances or articles, and of any other person for, by, or through whom the substances or articles were ordered or disposed of; (d) the date and method of shipment or delivery; and (e) if delivered or shipped by truck or other conveyance, the State or city registration number of such truck or conveyance, and the name and complete address of the operator of such truck or conveyance as shown by his operator's license, giving the number of such operator's license and the State where issued. Where shipment is made by a common carrier, such as a railroad, trucking company, steamboat line, etc., the information required by paragraph (e) of this section need not be reported, but in lieu thereof there shall be furnished the complete routing of the shipment, full name and address of first carrier, and railroad car number or name of ship. § 173.11

Returns required; containers. Every person in the United States who disposes of any containers, as defined in Section 173.5, shall, when required by a demand letter issued by the assistant regional commissioner, and until notified to the contrary in writing by such officer, for the purpose of protecting the

revenue, render in writing on Form 169A (or other form authorized by the assistant regional commissioner) for the periods specified in the demand letter, correct returns showing (a) the date of each disposition of such containers and in such quantities, as may be specified by the assistant regional commissioner in the demand letter; (b) the quantity and kind of containers disposed of; (c) the name and address of each purchaser, consignee, and other person actually receiving such containers and of any other person for, by, or through whom the containers were ordered or disposed of; (d) the date and method of shipment or delivery; and (e) if delivered or shipped by truck or other conveyance, the State or city registration number of such truck or conveyance, and the name and complete address of the operator of such truck or conveyance as shown by his operator's license, giving the number of such operator's license and the State where issued. Where shipment is made by a common carrier such as a railroad, trucking company, steamboat line, etc., the information required by paragraph (e) of this section need not be reported, but in lieu thereof there shall be furnished the complete routing of the shipment, full name and address of first carrier, and railroad car number or name of ship.

§ 173.12

Rendition of returns.

(a) The return shall be rendered on Form 169 (in the case of substances and articles) or Form 169A (in the case of containers) to the officer or employee of the Internal Revenue Service designated in the demand letter: Provided, That the assistant regional commissioner may authorize the return to be rendered in another form requiring the same information in lieu of Form 169 or Form 169A where it is shown that this is necessary in order to use tabulating equipment, or business machines, and will not (1) unduly hinder the effective administration of this part or (2) jeopardize the revenue. A person who proposes to use a form other than Form 169 or Form 169A shall submit a letterhead application so to do, in triplicate, to the assistant regional commissioner. Such application shall describe the proposed form and set forth the need therefor. The assistant regional commissioner will determine the need for the substitute form and whether approval thereof would unduly hinder the

A

effective administration of this part or result in jeopardy to the revenue. substitute form shall not be employed until approval is received from the assistant regional commissioner.

(b) The return shall be prepared and rendered in accordance with the instructions contained in the demand letter for the designated reporting period. Subpart D-Records To Be Maintained § 173.15 Records required.

Every person who has been required to render a return shall maintain at his place of business such books, records, documents, papers, invoices, bills of lading, etc., relating to or connected with any such disposition, as will enable such person to make the required return. Such books, records, documents, papers, invoices, bills of lading, etc., shall be maintained for a period of three years and shall be kept readily available for, and open to, inspection by any Internal Revenue Officer during the hours of business of such person.

Any person who willfully violates any provision of section 5291 or 5301(b) of the Internal Revenue Code of 1954, as amended, or of the regulations in this part shall, upon conviction, be fined or imprisoned as provided by section 5605 or 5606 of the Internal Revenue Code of 1954, as amended.

Subpart F-Manufacture, Sale, and Use of Bottles for Packaging Distilled Spirits

SOURCE: The provisions of this Subpart F contained in T.D. 6954, 33 FR. 6813, May 4, 1968, unless otherwise noted.

§ 173.31 Scope of subpart.

The provisions of this subpart shall apply only to liquor bottles having a capacity of 2 pint or more except where expressly applied to liquor bottles of less than 2-pint capacity.