1975 U.S. Tax Ct. LEXIS 165">*165
64 T.C. 35">*35 OPINION
This matter is before the Court on respondent's motion to dismiss for lack of jurisdiction on the ground that the petition in this case was not filed by a proper party.
In a notice of deficiency dated June 20, 1974, respondent determined the following Federal income tax deficiencies:
FYE Nov. 30 -- | Deficiency |
1968 | $ 14,985.42 |
1969 | 22,161.39 |
1970 | 1,238.66 |
This notice of deficiency was addressed to "Atlas Tool Co. Inc., Successor to Fletcher Plastics, Inc." The petition filed herein on September 13, 1974, was captioned "Fletcher Plastics, Inc., Stephan Schaffan, Transferee, Petitioner." It alleged that Fletcher Plastics was a corporation organized under the laws of 64 T.C. 35">*36 New Jersey but dissolved more than 3 years before the mailing of the notice of deficiency, and that Stephan Schaffan was its sole shareholder.
On October 25, 1974, respondent filed a motion to dismiss this case for lack of jurisdiction on the ground that the petition had not been filed by a proper party. On November 12, 1974, counsel for Atlas Tool filed a memorandum objecting to respondent's1975 U.S. Tax Ct. LEXIS 165">*168 motion to dismiss and a motion to amend the caption together with a motion to amend its petition pursuant to
There is no dispute that the petition captioned "Fletcher Plastics, Inc., Stephan Schaffan, Transferee, Petitioner" was timely filed. However, respondent asserts in his motion that neither Fletcher Plastics, Inc., nor Stephan Schaffan is the party to whom a notice of deficiency was sent nor are they legally entitled to institute a case on behalf of Atlas Tool Co., Successor to Fletcher Plastics, Inc., based on the notice of deficiency mailed in this case.
The only issue for our decision is whether Atlas Tool Co., Inc., the taxpayer to whom the notice of deficiency was sent, can ratify and amend, after the 90-day statutory period has expired, a petition filed on its behalf and signed by its counsel which was intended to contest the deficiencies determined in that notice, but incorrectly captioned.
The 1975 U.S. Tax Ct. LEXIS 165">*169 jurisdiction of the Tax Court is specifically limited by statute,
To invoke our jurisdiction,
64 T.C. 35">*37 A review of the cases decided prior to the adoption of our new Rules of Practice and Procedure on January 1, 1974, indicates that the general rule is that a petition must be filed by the taxpayer against whom the deficiency was determined or his duly authorized1975 U.S. Tax Ct. LEXIS 165">*170 representative, except in cases of transferee liability, see
1975 U.S. Tax Ct. LEXIS 165">*171 Respondent notes that
No amendment shall be allowed after expiration of the time for filing the petition, however, which would involve conferring jurisdiction on the Court over a matter which otherwise would not come within its jurisdiction under the petition as then on file * * *
In support of his position, respondent stresses the Note following this Rule which reads:
The rule of liberal amendment provided here applies to all pleadings, except for certain areas relating to the petition which concern the jurisdiction of the Court. The Court's jurisdiction is limited with respect to (a) the taxpayers whose tax deficiency or liability may be redetermined; (b) the years for which such redetermination may pertain. In these respects, a case is fixed by the petition as originally filed or as amended within the statutory period for filing the petition, and thereafter may not be altered by amendment as to 1975 U.S. Tax Ct. LEXIS 165">*172 any of these 64 T.C. 35">*38 areas.
Within the limits which apply to permissible amendments, see Par. (d) of this rule as to the relation back of the amendment to the initial date of filing of the pleading.
To the contrary, petitioner argues that this is a procedural, not a jurisdictional, problem. After noting that
In further support of his position, petitioner refers to
A case timely brought shall not be dismissed on the ground that it is not properly brought on behalf of a party until a reasonable time has been allowed after objection for ratification by such party of the bringing of the case; and such ratification shall have the same effect as if the case had been properly brought by such party. * * *
The Note following this Rule further shows a liberal attitude toward amendment and/or correction of pleadings in a case like that presently before us:
Where the intention is to file a petition on behalf of a party, the scope of this provision permits correction of errors as to the proper party or his identity made in a petition otherwise1975 U.S. Tax Ct. LEXIS 165">*174 timely and correct. * * *
After careful examination of the record and the law, we will deny respondent's motion to dismiss and grant petitioner's motion to amend the caption and the pleadings. Atlas Tool clearly intended to file a petition to contest the deficiencies determined in a notice of deficiency sent to it and this petition was signed by its duly authorized counsel, as permitted by
1975 U.S. Tax Ct. LEXIS 165">*175 Our holding here is consistent with
The dismissal of a petition, for failure to satisfy applicable requirements, depends on the nature of the defect, and therefore is put in the contingent "may" rather than the mandatory "shall" of present T.C.
In so acting, we are not taking jurisdiction of a matter which is outside our jurisdiction as determined by the petition originally filed. See
64 T.C. 35">*40 The remaining case cited in the Note,
The instant case is clearly distinguishable from
This situation is also distinguishable from those cases where a petition has been brought by a nonexistent party, see
Accordingly, we conclude that although the original defective petition was not filed in the name of a proper party as required by
1. Unless otherwise noted, all section references are to the Internal Revenue Code of 1954 as in effect during the years at issue.↩
2. Unless otherwise noted, all references to a Rule or Rules are to the Tax Court Rules of Practice and Procedure.↩
3. The practitioner can easily satisfy this requirement by using the name of the party to whom the notice of deficiency was sent, as it appears on the statutory notice, in the caption of the petition.↩
4. It appears that the improper caption resulted from an attempt of counsel to make the caption consistent with his theory that Fletcher Plastics was liquidated rather than a party to a reincorporation under
It is also alleged that the consents and papers relating to the deficiency were all in the name of Fletcher Plastics.
While neither of these is a sufficient reason for failing to use a proper caption, they are not inconsistent with an intent to file a petition to contest the deficiencies determined against Atlas Tool.↩