{
  "id": 5337809,
  "name": "Lee R. DAVIS, d/b/a Sutherland Furniture & Appliance, Appellant, v. COMMISSIONER OF REVENUE of the State of New Mexico, Appellee",
  "name_abbreviation": "Davis v. Commissioner of Revenue",
  "decision_date": "1971-08-06",
  "docket_number": "No. 653",
  "first_page": "152",
  "last_page": "154",
  "citations": [
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      "cite": "489 P.2d 660"
    }
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  "court": {
    "name_abbreviation": "N.M. Ct. App.",
    "id": 9025,
    "name": "Court of Appeals of New Mexico"
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    "name_long": "New Mexico",
    "name": "N.M."
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    {
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      "reporter": "N.M.",
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    {
      "cite": "80 N.M. 310",
      "category": "reporters:state",
      "reporter": "N.M.",
      "case_ids": [
        5362726
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      "year": 1969,
      "opinion_index": 0,
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  "last_updated": "2023-07-14T17:09:20.437308+00:00",
  "provenance": {
    "date_added": "2019-08-29",
    "source": "Harvard",
    "batch": "2018"
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  "casebody": {
    "judges": [
      "WOOD, C. J., and SUTIN, J., concur."
    ],
    "parties": [
      "Lee R. DAVIS, d/b/a Sutherland Furniture & Appliance, Appellant, v. COMMISSIONER OF REVENUE of the State of New Mexico, Appellee."
    ],
    "opinions": [
      {
        "text": "OPINION\nHENDLEY, Judge.\nThe Bureau made a deficiency assessment of gross receipts tax on Davis for State and Municipal tax.. The assessment was based on Davis\u2019 failure to include \u201ctime price differentials\u201d on credit sales which were made on installment contracts and sold to finance companies.\nAlthough the retail installment contracts were made in Davis\u2019 name, the finance companies furnished the 'contract forms, approved credit of the purchasers before the contracts were executed, and then purchased the contracts by paying Davis the \u201cTotal Cash Sales Price\u201d less the amount received by Davis as \u00e1 dowri payment. Davis did not receive the \u201ctime price differential.\u201d That sum, if paid, was received by the finance company purchasing the contracts.\nDavis protested the deficiency assessment on the grounds that he never received the money on which the deficiency assessment was based and that such a tax would be discriminatory and unconstitutional \u201c * * * because his gross receipts would be taxed at. more than the. applicable tax rates and more than the receipts of other taxpayers.\u201d\nWe reverse.\nTwo assessments were made. One assessment was made under \u00a7 72-16-7, N.M. S.A.1953 (Repl.Vol.1961) [repealed Laws 1966, Ch. 47, \u00a7 22, July 1, 1967] and the other for the period after July 1, 1967, being under \u00a7 72-16A-3, subd. F, N.M.S.A.1953 (Repl.Vol., Supp.1969).\nThose statutes read:\n72-16-7 \u201c * * * Provided, that in the event the seller or leaser [sic], who has so elected, transfers his interest in any such contract to some third person he shall pay the tax upon the full sale price of the commodity involved, unless a record is kept of payments thereafter made on such contracts in such manner that the bureau of revenue can at all times ascertain from the records of the seller the amount paid thereon by the purchaser. * * * \u201d\n72-16A-3 \u201c * * * F. \u2018gross receipts\u2019 means the total amount of money or the value of other consideration, received from selling property in New Mexico, from leasing property employed in New Mexico or from performing services in New Mexico, and includes any type of time-price differential and receipts from sales of tangible personal property handled on consignment but excludes cash discounts allowed and taken.\n\u201cIn an exchange in which the money or other consideration received does not represent the value of the property or service exchanged, \u2018gross receipts\u2019 means the reasonable value of the property or service exchanged.\n\u201cWhen the sale of property or service is made under any type of charge, conditional or time sales contract or the leasing of property is made under a leasing contract, the seller or lessor may elect to treat all receipts under such contracts as gross receipts as and when the payments are actually received. If the seller or lessor transfers his interest in any such contract to a third person, he shall pay the gross receipts tax upon the full sale or leasing contract amount.\n\u201c \u2018Gross receipts,\u2019 for the purposes of the business of buying, selling or promoting the purchase, sale or leasing, as factor, agent or broker, on a commission or fee basis, of any property, service, stock, bond or security, includes only the total commissions or fees derived from the business; \u201d\nAssessment Prior to July 1, 1967.\nThe Bureau contends that although \u201cfull sale price\u201d is not defined under the repealed law, \u201cgross proceeds of sales\u201d was defined by \u00a7 72-16-2, subd. E, N.M.S.A. 1953 (Repl.Vol.1961) [repealed Laws 1966, Ch. 47, \u00a7 22, July 1, 1967] which stated, in part :\n\u201c \u2018Gross proceeds of sales\u2019 means the sum or value proceeding or accruing from the sale of tangible personal property, * * * including any services that are a part of such sales * * *, whether received in money or otherwise, including all receipts, cash, credits and property of any kind or nature, and also the amount for which credit is allowed by the seller to the purchaser, * * * \u201d\nIt is the Bureau\u2019s contention that under this section, which must be read with \u00a7 72-16-7, supra, that the clear legislative intent is to include \u201ctime price differential\u201d as either \u201c * * * services that are a part of * * * sales * * * \u201d or \u201c * * * the amount for which credit is allowed by the seller to the purchaser.\u201d\nWe cannot agree with either of the Bureau\u2019s contentions. We must view the legislative intent from the language of the Act and the words will be given their ordinary meaning unless a different intent is clearly indicated. Winston v. New Mexico State Police Board, 80 N.M. 310, 454 P. 2d 967 (1969). A reading of the full Act shows the legislative intent to be that taxes were to be assessed only on what was received or would be received. It is an undisputed fact that the assessment made was on a \u201ctime price differenti\u00e1l\u201d which never was, nor would be, received by Davis. Davis would only receive the down payment and the balance of the purchase price would be paid to him by the finance company. The finance company would then receive the \u201ctime price differential.\u201d\nThe Bureau\u2019s reliance on Field Enterprises Educational Corporation v. Commissioner of Revenue, 82 N.M. 24, 474 P.2d 510 (Ct.App.1970), is misplaced. ' Although Field Enterprises Educational Corporation dealt with an undetermined and not precomputed service charge, one thrust of the case is that the monies from the \"service charge\u201d which were not received were not taxable. As stated in Field Enterprises Educational Corp oration:\n\u201c * * * The purchasers received from the taxpayer for these charges the benefits of additional services and expenses necessarily connected with the additional bookkeeping and billings. These additional services and expenses were not a part of the previously accomplished sale, and the charges therefor, arrived at by the contractual method of computation, in no way changed or affected the contractually determined sales price of the tangible property sold.\u201d\nWe cannot extend the applicability of the statute beyond a clear import of the language used. Field Enterprises Educational Corporation v. Commissioner of Revenue, supra.\nAssessment After July 1, 1967.\nWe find the same foregoing reasoning applicable under the Gross Receipts and Compensating Tax Act, \u00a7 72-16A-1, N.M. S.A.1953 (Supp.1969) et seq. We fail to see the Bureau\u2019s construction as being reasonable in light of the stipulation that the taxpayer only received the down payment and the balance of the \"Cash Sale Price\u201d or \u201cTotal Cash Price\u201d while the finance company received the difference between the \u201cCash Sale Price\u201d or \u201cTotal Cash Price\u201d and the \u201cTotal Time Balance.\u201d Compare Field Enterprises Educational Corporation.\nWe are not dissuaded from our decision by the language under \u00a7 72-16A-3, subd. F, supra, being changed from \u201cfull sale price\u201d to \u201cFull sale contract amount.\u201d We do not think the Legislature intended to tax that which was not received or never would be received. We believe this is evidenced by the fact that as a part of the \u201cgross receipts\u201d definition is the exclusion from taxation of \u201ccash discount allowed and taken.\u201d\nThe Bureau contends its theory of taxing the \u201cTime Balance\u201d is consistent with its Regulation 3(E)-3. We disagree. The example set out in the Regulation contemplates a seller who carries his own contracts and after collecting for a period of time, sells the contracts. Such are not the facts of the instant case.\nA fact of this case is that Davis would never receive any part of the \u201ctime price differential.\u201d This being so, no part of that differential was a gross receipt chargeable to Davis.\nHaving reached our decision, we do not discuss the taxpayer\u2019s equal and uniform taxation contention or the argument that taxpayer was the agent of the finance company in writing the contracts and that it was never contemplated that taxpayer would finance the purchasers.\nReversed.\nIt is so ordered.\nWOOD, C. J., and SUTIN, J., concur.",
        "type": "majority",
        "author": "HENDLEY, Judge."
      }
    ],
    "attorneys": [
      "O. R. Adams, Jr., Adams & Zeikus, Albuquerque, for appellant.",
      "David L. Norvell, Atty. Gen., John C. Cook, Special Asst. Atty. Gen., Santa Fe, for appellee."
    ],
    "corrections": "",
    "head_matter": "489 P.2d 660\nLee R. DAVIS, d/b/a Sutherland Furniture & Appliance, Appellant, v. COMMISSIONER OF REVENUE of the State of New Mexico, Appellee.\nNo. 653.\nCourt of Appeals of New Mexico.\nAug. 6, 1971.\nRehearing Denied Sept. 7, 1971.\nCertiorari Denied Oct. 6, 1971.\nO. R. Adams, Jr., Adams & Zeikus, Albuquerque, for appellant.\nDavid L. Norvell, Atty. Gen., John C. Cook, Special Asst. Atty. Gen., Santa Fe, for appellee."
  },
  "file_name": "0152-01",
  "first_page_order": 278,
  "last_page_order": 280
}