SEC. 3042. ASSIGNMENT OF STOREKEEPER-GAUGERS TO FRUIT DISTILLERIES AND WINERIES. (a) POWER OF COMMISSIONER.-The Commissioner is authorized to assign to any fruit distillery and to each winery where wines are to be fortified such number of storekeeper-gaugers as may be necessary for the proper supervision of the manufacture of brandy or the making or fortifying of wines subject to tax imposed by this chapter. (b) TRANSFER OF DUTIES. For transfer of powers and duties of Commissioner and his agents, see section 3170. SEC. 3043. PENALTIES AND FORFEITURES. (a) OFFENSES.-Whoever evades or attempts to evade any tax imposed by section 1 3030 or 3031, or any requirement of this subchapter, or regulation issued pursuant thereto, or whoever, otherwise than as provided in this subchapter, recovers or attempts to recover any spirits from domestic or imported wine, shall, on conviction, be punished for each such offense by a fine of not exceeding $5,000, or imprisonment for not more than five years, or both, and in addition thereto by a penalty of double the tax evaded, or attempted to be evaded, to be assessed and collected in the same manner as taxes are assessed and collected, and all wines, spirits, liqueurs, cordials, or similar compounds as to which such violation occurs shall be forfeited to the United States. But the provisions of this section and of section 3254 (g) relating to rectification, or other internal revenue laws of the United States, shall not be held to apply to or prohibit the mixing or blending of wines subject to tax under the provisions of section1 3030 or 3031 with each other or with other wines for the sole purpose of perfecting such wines according to commercial standards, nor to apply to or prohibit the fermentation of grape wine retsina with resin on bonded winery premises: Provided, That nothing herein contained shall be construed as prohibiting the use of tax-paid grain or other ethyl alcohol in the fortification of sweet wines as defined in sections 3036 and 3044. (b) CROSS REFERENCES. For forfeiture of wines in case special tax has not been paid or business of distiller is carried on without bond or with intent to defraud the Government of tax, see sections 2833 and 3253. For penalty and forfeiture imposed upon rectifiers and wholesale liquor dealers for committing offenses not specifically covered by law, see section 2806 (g). For penalties and forfeitures for other violations, see section 3173. SEC. 3044. DEFINITIONS. (a) NATURAL WINE.-Natural wine within the meaning of this subchapter shall be deemed to be the product made from the normal alcoholic fermentation of the juice of sound, ripe grapes, without addition or abstraction, except such as may occur in the usual cellar treatment of clarifying and aging. (b) WINE. The product made from the juice of sound, ripe grapes by complete fermentation of the must under proper cellar treatment and corrected by the addition (under the supervision of a storekeepergauger) of a solution of water and pure cane, beet, or dextrose sugar 1 The statute reads "sections". (containing, respectively, not less than 95 per centum of actual sugar, calculated on a dry basis) to the must or to the wine, to correct natural deficiencies, when such addition shall not increase the volume of the resultant product more than 35 per centum, and the resultant product does not contain less than five parts per 1,000 of acid before fermentation and not more than 13 per centum of alcohol after complete fermentation or, if sweetened, after complete fermentation and sweetening, shall be deemed to be wine within the meaning of this subchapter, and may be labeled, transported, and sold as "wine," qualified by the name of the locality where produced, and may be further qualified by the name of its own particular type or variety. (c) SWEET WINE.-Wine as defined in this section may be sweetened with cane sugar or beet sugar or pure condensed grape must and fortified under the provisions of this subchapter, and wines so sweetened or fortified shall be considered sweet wine within the meaning of this subchapter. (d) PURE SWEET WINE. For definition of pure sweet wine, see section 3036 (a). SEC. 3045. APPLICATION OF NATURAL WINE PROVISIONS TO CITRUSFRUIT WINES AND OTHER LIKE WINES. The provisions of the internal revenue laws applicable to natural wine shall apply in the same manner and to the same extent to citrusfruit wines, peach wines, cherry wines, berry wines, apricot wines, prune wines, plum wines, pear wines, pawpaw wines, papaya wines, pineapple wines, cantaloup wines, and apple wines, which are the products, respectively, of normal alcoholic fermentation of the juice of sound ripe (1) citrus-fruit (except lemons and limes), (2) peaches, (3) cherries, (4) berries, (5) apricots, (6) prunes, (7) plums, (8) pears, (9) pawpaws, (10) papayas, (11) pineapples, (12) cantaloups, (13) apples, with or without the addition of dry cane, beet, or dextrose sugar (containing, respectively, not less than 95 per centum of actual sugar, calculated on a dry basis) for the purpose of perfecting the product according to standards, but without the addition or abstraction of other substances, except as may occur in the usual cellar treatment of clarifying or aging: Provided, That in the case of wines produced from loganberries, currants, or gooseberries, respectively, having a normal acidity of 20 parts or more per 1,000, the volume of the resultant product may be increased more than 35 per centum but not more than 60 per centum by the addition of sugar and water solution under such regulations as the Commissioner1 may prescribe. SUBCHAPTER C-INDUSTRIAL ALCOHOL Part I-Denaturation SEC. 3070. WITHDRAWAL FROM BOND TAX FREE. (a) FOR INDUSTRIAL USE.-Domestic alcohol of such degree of proof as may be prescribed by the Commissioner, and approved by the Secretary, may be withdrawn from bond without the payment of internal revenue tax, for use in the arts and industries, and for fuel, 1 The words "of Internal Revenue" are omitted. light, and power, provided said alcohol shall have been mixed in the presence and under the direction of an authorized Government officer, after withdrawal from the internal revenue bonded warehouse,' with methyl alcohol or other denaturing material or materials, or admixture of the same, suitable to the use for which the alcohol is withdrawn, but which destroys its character as a beverage and renders it unfit for liquid medicinal purposes; such denaturing to be done upon the application of any registered distillery in denaturing bonded warehouses specially designated or set apart for denaturing purposes only, and under conditions prescribed by the Commissioner with the approval of the Secretary. The character and quantity of the said denaturing material and the conditions upon which said alcohol may be withdrawn free of tax shall be prescribed by the Commissioner, who shall, with the approval of the Secretary, make all necessary regulations for carrying into effect the provisions of this subsection. Distillers, manufacturers, dealers, and all other persons furnishing, handling, or using alcohol withdrawn from bond under the provisions of this section shall keep such books and records, execute such bonds, and render such returns as the Commissioner, with the approval of the Secretary, may by regulation require. Such books and records shall be open at all times to the inspection of any internal revenue officer or agent. (b) FOR USE IN MANUFACTURE OF CHEMICALS.-Notwithstanding anything contained in subsection (a), domestic alcohol when suitably denatured may be withdrawn from bond without the payment of internal revenue tax and used in the manufacture of ether and chloroform and other definite chemical substances where said alcohol is changed into some other chemical substance and does not appear in the finished product as alcohol. Rum of not less than 150 degrees proof may be withdrawn, for denaturation only, in accordance with the provisions of subsection (a). (c) TRANSFER OF DUTIES.— For transfer of powers and duties of Commissioner and his agents, see section 3170. SEC. 3071. DRAWING OFF AND TRANSFER OF ALCOHOL FOR DE NATURATION. For provisions relating to the drawing off and transfer of alcohol for denaturation, see section 3108 (a). SEC. 3072. UNLAWFUL USE OR CONCEALMENT ALCOHOL. OF DENATURED Any person who withdraws alcohol free of tax under the provisions of section 3070 (a) and regulations made in pursuance thereof, and who removes or conceals same, or is concerned in removing, depositing, or concealing same for the purpose of preventing the same from being denatured under governmental supervision, and any person who uses alcohol withdrawn from bond under the provisions of said section for manufacturing any beverage or liquid medicinal preparation, or knowingly sells any beverage or liquid medicinal preparation made in whole or in part from such alcohol, or knowingly violates any 1 The statute reads "distillery warehouse". of the provisions of section 3070 (a) or 3073, or (except as provided in section 3073) who shall recover or attempt to recover by redistillation or by any other process or means any alcohol rendered unfit for beverage or liquid medicinal purposes under the provisions of section 3070 (a), or who knowingly uses, sells, conceals, or otherwise disposes of alcohol so recovered or redistilled, shall on conviction of each offense be fined not more than $5,000, or be imprisoned not more than five years, or both, and shall, in addition, forfeit to the United States all personal property used in connection with his business, together with the buildings and lots or parcels of ground constituting the premises on which said unlawful acts are performed or permitted to be performed. SEC. 3073. RECOVERY OF SPIRITS FOR REUSE IN MANUFACTURE. (a) REGULATIONS.-Manufacturers employing processes in which alcohol, used free of tax under the provisions of section 3070 (a), is expressed or evaporated from the articles manufactured shall be permitted to recover such alcohol and to have such alcohol restored to a condition suitable solely for reuse in manufacturing processes under such regulations as the Commissioner, with the approval of the Secretary, shall prescribe. (b) TRANSFER OF DUTIES. For transfer of powers and duties of Commissioner and his agents, see section 3170. SEC. 3074. SALE OF ABANDONED SPIRITS FOR DENATURATION WITHOUT COLLECTION OF TAX. (a) REGULATIONS.-Notwithstanding the provisions of section 2805 (b) of this chapter, any distilled spirits abandoned to the United States may be sold, in such cases as the Commissioner may by regulation provide, to the proprietor of any industrial alcohol plant for denaturation, or redistillation and denaturation, without the payment of the internal revenue tax thereon. (b) TRANSFER OF DUTIES. For transfer of powers and duties of Commissioner and his agents, see section 3170. Part II-Industrial Alcohol Plants SEC. 3100. ESTABLISHMENT OF INDUSTRIAL ALCOHOL PLANTS. (a) REQUIREMENTS. Any person establishing a plant for the production of industrial alcohol shall, before operation, make application to the Commissioner for registration of his plant, file bond, and receive permit for the operation of such plant. (b) TRANSFER OF DUTIES. For transfer of powers and duties of Commissioner and his agents, see section 3170. SEC. 3101. ESTABLISHMENT OF INDUSTRIAL ALCOHOL WAREHOUSES. (a) REQUIREMENTS.-Warehouses for the storage and distribution of alcohol may be established upon filing of application and bond and issuance of permit at such places, either in connection with the manufacturing plant or elsewhere, as the Commissioner may determine; and the entry and storage of alcohol therein and the with drawals of alcohol therefrom shall be made in such containers and by such means as the Commissioner by regulation may prescribe. Permanent tanks and other structures located on the industrial alcohol plant premises and approved by the Commissioner shall be deemed to be warehouses within the meaning of this section. (b) TRANSFER OF DUTIES. For transfer of powers and duties of Commissioner and his agents, see section 3170. SEC. 3102. ESTABLISHMENT OF DENATURING PLANTS. Upon the filing of application and bond and issuance of permit, denaturing plants may be established upon the premises of any industrial alcohol plant, or elsewhere, and shall be used exclusively for the denaturation of alcohol by the admixture of such denaturing materials as shall render the alcohol, or any compound in which it is authorized to be used, unfit for use as an intoxicating beverage. SEC. 3103. EXEMPTION OF INDUSTRIAL ALCOHOL PLANTS AND WAREHOUSES FROM CERTAIN LAWS. Industrial alcohol plants and bonded warehouses established under the provisions of this part shall be exempt from the provisions of sections 3154, 3244, 3258, 3259, 3260, 3263, 3264, 3266, 3267, 3268, 3269, 3271, 3273, 3274, 3275, 3279, 3280, 3283, 3284, 3285, 3286, 3287, 3288, 3289, 3290, 3291, 3292, 3293, 3294, 3295, 3302, 3303, 3307, 3308, 3309, 3310, 3311, 3312, 3313, 3314, and 3327 of the Revised Statutes; sections 48 to 60, inclusive, and sections 62 and 67 of the act of August 27, 1894 (Twenty-eighth Statutes, pages 563 to 568), as such sections existed on October 28, 1919, and from such other provisions of laws existing on October 28, 1919, relating to distilleries and bonded warehouses as may by regulations be declared inapplicable to industrial alcohol plants and bonded warehouses established under this subchapter. Regulations may be made embodying any provision of the sections above enumerated. [The sections referred to in section 3103 correspond roughly but not exactly to I. R. C. sections 2802 (a) (1) and (2) and (d) (1) and (2), 2806 (c) and (d), 2810 (a), 2812 (a), 2814 (a), 2815 (c-e), 2816 (a), 2817 (a) and (b), 2819, 2820 (a), 2821, 2822 (a), 2826 (a), 2831, 2832, 2836, 2838, 2839 (a), 2840 (a), 2841 (a) (1), 2844 (a), 2845 (a), 2846 (a), 2849, 2850 (a), 2851 (a), 2859 (a), 2860, 2870, 2872, 2874 (a), 2876, 2877 (a), 2878 (a-d), 2879 (a-d), 2880 (a), 2882 (a), 2884 (a), 3250 (a) (1, 3, 4), (b) (1, 2, 4), (c) (1), (d) (1–3), (e) (1–4), (j) (1) and (3), 3251, 3254 (b-h), 3255 (c), 4013 (a), 4014 (a), 4017 (a) and 4021 (a) and (b).] SEC. 3104. WITHDRAWAL OF FERMENTED LIQUORS TO INDUSTRIAL ALCOHOL PLANTS. (a) REQUIREMENTS. -Fermented liquors may be conveyed without payment of tax from the brewery premises where produced to a contiguous industrial alcohol plant, to be used as distilling material, and the residue from such distillation, containing less than one-half of 1 per centum of alcohol by volume, which is to be used in making beverages, may be manipulated by cooling, flavoring, carbonating, settling, and filtering on the distillery premises or elsewhere. The removal of the taxable fermented liquor from the brewery to the distillery and the operation of the distillery and removal of the residue therefrom shall be under the supervision of such officer or |