1899, in which the above-named preparations are held to be taxable for certain reasons therein stated. This application for reconsideration is based on the contention (1) that tonic beer is not prepared from any private formula, secret or occult method; (2) that no claims are made for the exclusive right to manufacture this tonic beer; (3) that it is not recommended to the public as a proprietary medicine, or a medicinal proprietary article or preparation, or as a remedy or specific for any disease. Counsel contends that the word "tonic" applied to this beer is an arbitrary term by which the article is known to the trade and to consumers. It is further contended, in order to render this tonic beer taxable, it must be a tonic, or be held out or sold as a tonic. Further, that because a preparation bears the name tonic, it should not be held to be taxable, when, in fact, it is not such. Counsel, in conclusion, places the question fairly at issue, when he says: The whole question hinges on the fact whether "tonic beer" is a "tonic" as contemplated by the act. Counsel contends, and rightly, too— If tonic beer is not a tonic, as contemplated by the act, * then the fact that it is sold under a trade-mark becomes immaterial. Under the statute, it is only necessary to show that a preparation is held out or advertised on the label or otherwise as a "tonic" to hold it taxable, if sold under letters patent, trade-mark, or other evidence of proprietorship. The word "tonic," used in connection with the word "beer," is an adjective, qualifying the word "beer," and is defined by Webster, the prescribed authority in this Department, as follows: Increasing strength, or tone of the animal system, obviating the effects of debility and restoring healthy functions. It is manifest, therefore, to make use of the term "tonic beer" is to ascribe to the preparation sold thereunder the medicinal properties set forth in the definition quoted above. This, then, when considered with the fact that the "tonic beer" is put up under a trade-mark, clearly renders the preparation taxable, under the statute. The medicinal nature of the "tonic beer" can be definitely established by another method, and by evidence furnished by counsel. The following is taken from the affidavit of George W. Cook, filed by Attorney Tobriner: That there is no secret in the preparing of same and that the component parts are generally as follows: Sassafras, wintergreen, annis, and gentian or quassia. By reference to any standard authority, for example, the United States Dispensatory, each of these ingredients will be found to possess medicinal qualities, and, in the case of the latter two, valuable tonic properties will be found ascribed to them. The fact that "tonic beer" is prepared with well-known medicines, authoritatively stated to have valuable tonic properties, is sufficient in itself to render the preparation taxable under the statute when considered with the fact that it is put up under an acknowledged trade-mark. In conclusion, I am clearly of the opinion that there has been no new evidence submitted that would warrant any disturbance of the action of October 2, 1899, holding these preparations to be taxable, and, therefore, it is accordingly adhered to. You will please advise Messrs. Palmer & Johnson, and J. F. Herrmann & Son, Washington, D. C., in accordance with this action, and proceed in the usual way to collect the tax accrued by reason of their failure to properly stamp these goods since July 1, 1898. Respectfully, yours, ROBT. WILLIAMS, Jr., Acting Commissioner. Mr. B. F. PARLETT, Collector Internal Revenue, Baltimore, Md. (21802.) Special tax-Angostura Bitters.1 The special taxes of a rectifier and liquor dealer are not required to be paid for the manufacture and sale of Angostura Bitters that are a mere alcoholic extract, suitable only for use medicinally or in giving an agreeable flavor to beverages. TREASURY DEPARTMENT, OFFICE OF COMMISSIONER OF INTERNAL REVENUE, Washington, D. C., November 23, 1899. SIR: Your letter of the 30th ultimo, replying to the letter from this office dated the 23d ultimo, concerning the special-tax liability of C. W. Abbott & Co., of Baltimore, as rectifiers and liquor dealers for manufacturing and selling Angostura Bitters, has been received, inclosing statement made by that company setting forth that their "Angostu. Hitters is an extract pure and simple," and that "a bottle of Angostura flavors between three and four hundred drinks." They further say: As it is used by some in mixing cocktails, or with other liquors, we do not think it should work to either the disadvantage of a soda-water bottler or ourselves when you recall that Jamaica ginger, essence of peppermint, celery extract, and other alcoholic extracts are used in the same manner. The label used on bottles of this compound holds it out as a medicine in the following terms: For disorders of he digestive organs, for weakness and distress of stomach and bowels, "Abbott's Angostura" is an unequaled preventive and cure. 'Angostura Bitters put up as herein described are, of course, taxable as a medicinal proprietary article. It further appears from this label that even when this compound is used in beverages only a few drops are used therein, for the purpose merely of giving an agreeable flavor to the drink. Upon these facts it is held, and you may so inform C. W. Abbott & Co., that the special taxes of a rectifier and liquor dealer are not required to be paid for the manufacture and sale of these Angostura Bitters under the label herein referred to. Respectfully, yours, ROBT. WILLIAMS, Jr., Acting Commissioner. Mr. B. F. PARLETT, Collector Internal Revenue, Baltimore, Md. (21833.) Stamp tax-Medicinal preparations. Distilled water held to be entitled to exemption from tax even if advertised as a remedy or cosmetic. TREASURY DEPARTMENT, OFFICE OF COMMISSIONER OF INTERNAL REVENUE, Washington, D. C., December 7, 1899. SIR: Your letter under date of September 26, 1899, was received. You inclose a brief in re Aërated Distilled Water Company, Denver, Colo., submitted by George Q. Richmond, attorney at law, People's Bank Building, Denver, Colo., together with an affidavit in support thereof by N. O. McClees, manager of said company. It appears that the Aërated Distilled Water Company are placing on the market unstamped what is stated to be an aërated distilled water, produced by converting ordinary hydrant or stream water into steam, and recondensing it into water, thereby, it is alleged, destroying all disease-producing germs and impurities. This hydrant or stream water so treated is thereafter bottled and labeled as follows: AERATED DISTILLED WATER. Absolutely pure. Preserves health. Lengthens life. Softens the complexion. Directions: For the complexion Aërated Distilled Water may be used hot in place of steaming. The prevalent idea that washing the face is bad for the complexion is due to the bad effects of hard water when employed for that purpose. Distilled water and good soap are better for purifying and preserving the complexion, scalp, and hair than any other agents. In the booklet submitted, the following appears: As a remedy. Eminent physicians tell us that not only can disease be prevented by the use of pure water, but many can also be cured by its free use. Particularly is this true of malaria, nervousness, kidney diseases, rheumatism, dyspepsia, and indigestion. While counsel admits that this water is advertised to preserve health, lengthen life, and soften the complexion, he contends it should be classified as a food preparation. Upon careful consideration of all the facts submitted in this case, I am of the opinion that if the article put upon the market as aërated distilled water is a distillate of common hydrant, creek, or river water, without the addition of any other substance, either before the process of distillation is commenced, during the process of distillation, or after the process of distillation is complete, that, irrespective of whatever remedial claims are made for it, it is nevertheless an uncompounded medicinal article, having a definite and known arrangement of molecules, H2O, and, therefore, under the construction placed upon the law by Mr. Justice Brown of the United States district court for the southern district of New York, it is entitled to the exemption provided under section 20, and it is so held. Nor is aërated distilled water liable to stamp duty under the fifth paragraph of schedule B, because it is neither perfumery or a cosmetic, nor is it similar to these articles, or known or designated as such in commercial transactions. Respectfully, yours, Mr. F. W. HOWBERT, G. W. WILSON, Commissioner. Collector Internal Revenue, Denver, Colo. MORTGAGES. (See also CONVEYANCES; and DECISIONS 20676, p. 53; 20788, p. 36; 20793, p. 237; 20796, p. 39; 21583, p. 103; 21620, p. 65.) (20724.) Stamp tax-Chattel mortgages. Yearly renewals of chattel mortgages, by affidavit, under law of Michigan, do not require stamps. TREASURY DEPARTMENT, OFFICE OF COMMISSIONER OF INTERNAL REVENUE, Washington, D. C., February 20, 1899. SIR: I have the honor to acknowledge the receipt of the letter of Mr. Geo. A. Hart, of Manistee, Mich., written to you under date of February 1, 1899, and by you referred to this office for consideration. The question submitted by this gentleman relates to the taxability of instruments used in the State of Michigan in connection with chattel mortgages as renewal affidavits. These affidavits are provided for in section 6196, Howell's Annotated Statutes, which reads as follows: Every such mortgage shall cease to be valid, as against the creditors of the person making the same, or subsequent purchasers or mort gagees in good faith, after the expiration of one year from the filing of the same, or a copy thereof, unless within thirty days next preceding the expiration of the year the mortgagee, his agent or attorney, shall make and annex to the instrument or copy on file as aforesaid an affidavit, setting forth the interest which the mortgagee has, by virtue of said mortgage, in the property therein mentioned; upon which affidavit the township or city clerk shall indorse the time when the same was filed: Provided, That such affidavit being made and filed before any purchase of such mortgage property shall be made, or other mortgage received or lien obtained thereon in good faith, shall be as valid to continue in effect such mortgage as if the same were made and filed within the period as above provided. Section 6197 provides as follows: The effect of any such affidavit shall not continue beyond one year from the time when such mortgage would otherwise cease to be valid, as against subsequent purchasers or mortgagees in good faith; but within thirty days next preceding the time when such mortgage would otherwise cease to be valid as aforesaid, a similar affidavit may be filed and annexed, as provided in the preceding section, and with like effect. The former ruling of this office upon these instruments was that, when taken in connection with the chattel mortgage itself, they were subject to taxation as new mortgages. This ruling has been objected to on the ground that these instruments do not change or alter in any respect the chattel mortgage in reference to which they are required to be filed. The following is the form of instrument used in the State of Michigan: STATE OF MICHIGAN, of - , being duly sworn, deposes and says he is the owner of a certain chattel mortgage, given by dated the day of 189-, and filed in the office of the to of A. D. in said county, on the day A. D. 189-, at — o'clock. M.; that he makes this affidavit for and in being acquainted with the facts; that there is due and remaining and interest from -- which said in the property in said mortgage men behalf of unpaid on said mortgage the sum of $sum constitutes the interest of said tioned and described, and said mortgage is hereby renewed for the amount above The following claims are made in reference to the above instrument: First, they are required only to protect the interest of the mortgagee in the mortgaged property as against the creditors of the mortgagor or subsequent purchasers or mortgagees in good faith, and do not affect the rights as between the original parties. Second, these instruments are required annually, whether the mortgage has matured or not. |