157 Pa. 507 | Pa. | 1893
Opinion by
This case involves a question not -settled by the Commonwealth v. Pottsville Iron and Steel Company [the preceding case], which has just been decided. In that case a power had been conferred upon a manufacturing company to mine its raw materials, but when the company came to make its investments and organize its business it discarded this power and arranged to supply itself with its materials and fuel by purchase. We held in that case that the mere possession of a power, ancillary to its manufacturing business, which had never been used and the use of which had been effectually declined by the character of its business organization, did not deprive a manufacturing company of the exemption- of its capital stock from taxation under the proviso in the act of 1889. In this case we have the power to mine coal for the manufacture of coke, and we have the continued use of this power as a means of providing itself with the coal from which the coke is made. The production of coke from coal is a process of manufacture. The production of coal by removing it from its bed and bringing it to the surface is a process of mining. They have no necessary connection. The legislature has seen fit to separate and classify corporate powers, and to confer upon one class of corporations an exemption from taxes which other classes are required to pay. Manufacturing companies must purchase their supplies in the market. It may be convenient for them to produce their raw material, as in the case of the appellant, and the denial of the power to-do so may work some inconvenience, and increase the cost of the manufactured article; but the exemption is conferred upon the manufacturer, as distinguished from the
We understand from the findings of the court below, and from the evidence, that this company was organized as a manufacturing company, and has been steadily engaged in the manufacture of coke. We understand that it has the power to mine its own coal and has in fact done so from the first, and that it has in this way supplied itself in part with the raw material it has used. This as we have held in Commonwealth v. Pottsville Iron and Steel Company, supra, does not strip it of its character as a manufacturing company, or of the protection which the law has extended to manufacturers. But on the other hand the fact that its business is manufacturing will not enable it to bring under the protection of its privilege any ancillary line of business in which it may find it economical or convenient to engage, or cover the employment of its capital for any other than strictly manufacturing purposes. What then is the situation of the appellant? It is in name, in business purpose, and in product prepared for the market, a manufacturing company. In the conduct of its manufacturing business it seeks to cheapen its raw material, and thereby the cost of its product by mining the coal it consumes. This is not necessary to the process of manufacture, though it may be both economical and convenient for the manufacturer. It is therefore the employment of part of its capital for a purpose not within the letter or the spirit of the exemption. As to so much of its capital it is subject to taxation precisely as though no exemption existed. The use of the word “ exclusively ” in the proviso in the act of 1889, given the office we have assigned to it in the Pottsville Iron and Steel Company’s case, does not stand in the way of our conclusion in this case. It was intended, as we there held, to discriminate between com-
The judgment is reversed and record remitted that the apportionment may be made.
See also the preceding and following cases.