ERROR TO THE DISTRICT COURT OF THE UNITED STATES FOR THE DISTRICT OF OREGON
McKenna, Holmes, Day, Van Devanter, Pitney, McReynolds, Brandeis, Clarke
MR. JUSTICE DAY delivered the opinion of the court.
This case is here under the Criminal Appeals Act. 34 Stat. 1246. The indictment is in four counts.
The first count, based on § 3257 of the Revised Statutes, 6 Comp. Stats., § 5993, charges the defendants with unlawfully engaging in the business of distillers within the intent and meaning of the internal revenue laws of the United States; and that in fact they did distill spirits subject to the internal revenue tax imposed by the laws of the United States; and did defraud and attempt to defraud the United States of the tax on said spirits. The second count, based on § 3279 of the Revised Statutes, 6 Comp. Stats., § 6019, charges that the defendants failed to keep on the distillery, conducted by them, any sign exhibiting the name or firm of the distiller, with the words "Registered Distillery," as required by statute. The third count, based on § 3281 of the Revised Statutes, 6 Comp. Stats., § 6021, charges the defendants with carrying on the business of distilling within the intent and meaning of the internal revenue laws of the United States without giving the bond required by law. The fourth count, based on § 3282 of the Revised Statutes, 6 Comp. Stats., § 6022, charges the defendants with unlawfully making a mash, fit for distillation, in a building not a distillery duly authorized by law.
The defendants interposed a motion to quash the indictment upon the grounds that the acts of Congress under which the same found were repealed before the finding of the indictment, and that the acts charged to have been committed by them were after the date upon which the Eighteenth Amendment to the Federal Constitution and the Volstead Act became effective. Defendants also filed a demurrer to the indictment on practically the same grounds. The motion to quash and the demurrer were sustained by the District Court. 266 Fed. Rep. 746.
The sections of the Revised Statutes may be summarized as follows: Section 3257 makes it an offense to defraud or attempt to defraud the United States of a tax
upon spirits distilled by one carrying on the business of a distiller; provides for forfeiting the distillery and the distilling apparatus and all spirits found in the distillery or on the distillery premises, and subjects the offender to a fine of not less than $500 or more than $5,000, and imprisonment of not less than six months or more than three years. Section 3279 requires distillers to exhibit on the outside of their place of business a sign with the words: "Registered Distillery." A violation of this section subjects the offender to a fine of $500. Section 3281 makes it an offense to carry on the business of a distiller without having given bond. For such offense the penalty is a fine from $1,000 to $5,000 and imprisonment not less than six months or more than two years. Section 3282 makes it penal to make or permit mash to be made in any building other than a distillery authorized by law. A violation of this section subjects the offender to a fine of not less than $500 or more than $5,000, and imprisonment of not less than six months or more than two years.
These statutes have long been part of the federal internal revenue legislation, and were passed under the authority of the taxing power conferred upon Congress by the Constitution of the United States. At the time of their enactment it was legal, so far as the Federal Government was concerned, to manufacture and sell ardent spirits for beverage purposes. The Government derived large revenue from taxing the business, which it sought to realize and protect by the system of laws of which the sections in question were a part. This policy was radically changed by the adoption of the Eighteenth Amendment to the Federal Constitution, and the enactment of legislation to make the Amendment effective. The Eighteenth Amendment in comprehensive and clear language prohibits the manufacture or sale of intoxicating liquors in the United States for
beverage purposes, and confers upon Congress the power to enforce the Amendment by appropriate legislation. To this end, Congress passed a national prohibition law known as the Volstead Act. 41 Stat. 305. It is a comprehensive statute intended to prevent ...