Opinion by
The Commonwealth of Pennsylvania, Department of Revenue, Bureau of Sales and Use Taxes (Commonwealth ), . instituted separate criminal prosecutions against Marcus Shafer, Frank E. Slosar and Helen M. Cecchini charging each of them with a violation of §823 of The Penal Code of 1939 (Act of June 24, 1939, P. L. 872, 18 P.S. §4823) and each person was indicted. The indictments were quashed.
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On appeal,
Upon these appeals, three issues are presented: (1) whether §823 of The Penal Code applies to vendors who have collected sales taxes from purchasers of tangible personal property pursuant to the provisions of the Selective Sales and Use Tax Act 2 (Sales Tax Act) ? (2) whether prosecution, under §823- of
The Penal Code, of a vendor, who has collected sales' tax monies and converted or appropriated said monies to his own use is precluded by §573 of the Sales Tax Act (72 P.S. §3403-573) ? (3) in the Shafer appeal, is the president of a business corporation, licensed to collect sales tax monies, subject to prosecution under §823 of The Penal Code?
The Superior Court determined only the first issue presented and, in view of its disposition of that issue, considered determination of the other two issues unnecessary. On the first issue, the Superior-Court construed §823 of The Penal Code as restricted and confined in its application to public officials, i.e., elected or appointed tax collectors, and not applicable to private citizens, i.e., vendors who collect the Commonwealth sales tax from the purchasers at retail sales of tangible personal property or the use thereof.
Section 823 of The Penal Code provides: . Whoever, being charged with the collection, safekeeping, or transfer of any taxes of the Commonwealth, or any political subdivision thereof, converts or appropriates the moneys so collected, or any part thereof, to his own use in any way whatever, or uses by
Is the vendor who collects and converts or appropriates a sales tax to his own use guilty of embezzlement under §823, supra? Although the term “tax collector” appears only in the heading prefixed to §823, under the Superior Court’s ruling, since vendors, charged with the collection, and the payment over,, of the sales tax are not public officials in the accepted-sense, such vendors are not, by virtue of the Sales Tax Act, “elevated to the status of a tax collector within the purview of Section 823 of The Penal Code.”'.
Section 823, by its terms, encompasses
“whoever,
being charged with the collection, safekeeping, or transfer of any taxes of the Commonwealth”. (Emphasis supplied) Section 201(a) of the Sales Tax Act (1) imposes a 5% per cent tax on each separate retail sale of personalty or the use thereof and - (2) provides that the vendor shall collect the tax from the purchaser of the personalty or the use thereof and pay the tax over to the Commonwealth; §546(b) of the Sales Tax Act reemphasizes the manner of collection of the tax by providing that “every person maintaining a place of business” and “selling or leasing
The conclusion of the Superior Court was based on several grounds: (a) the source of §823 of The-Penal Code was the Act of June 3, 1885, P. L. 72'and-that statute was consistently held applicable only to elected or appointed tax collectors; 3 (b) the language of §823; (c) the absence of any definition of “tax collector” in the Sales Tax Act; (d) the heading of §823; (e) the legislative mandate that penal statutes be strictly construed: Statutory Construction Aet of 1937; §58, 46 P.S. §558. Each ground will be examined:
No doubt the source of §823 was the 1885 statute, supra, but that statute, titled “An Act to punish defaulting tax collectors”, is much less extensive in its scope than §823. The 1885 statute encompassed “any-
person
charged with the collection, safekeeping or transfer of any state, county, township, school, city, borough, or municipal taxes, under any law or laws of this commonwealth” (Emphasis supplied) but contained no definition of the word “person”. On the other hand, the legislature in The Penal Code has seen fit to define the word “person” or “whoever” as inclusive of an individual, copartnership, association and corporation
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(§103, 18 P.S. §4103). Nowhere in the language of §823 is there any indication that the leg-, islature intended that the word “whoever” be defined,
The language of §823, particularly when the word “whoever”’is defined as in §103, is-comprehensive and abroad in scope, and embraces all who collect any. taxes. Moreover, the absence in the Sales Tax. Act of a definition óf a “tax-collector” does ,not affect the- construction in. this'manner of §823. .The Sales-' Tax .Act,
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as
While the legislature has mandated that penal statutes be strictly construed, such mandate does not require that the plain, clear language of a statute be ignored nor that we be unmindful of the necessity of construing statutes, aimed at the protection of public monies, “broadly enough to serve the public purpose of protecting the public interest.”:
Commonwealth v. Burns,
It is true that the heading prefixed to §823 contains the phrase “Embezzlement by tax collectors”. However, such heading in no sense controls the construction of that section: Statutory Construction Act, Act of May 28, 1937, P. L. 1019, §54;
Wiley v. Umbel,
Section 823, when read in conjunction with §822, clearly indicates the legislative intent. Section 822, entitled “Embezzlement by public officers” provides: “Whoever,
being an officer, employe or agent of this Commonwealth, or political subdivision
thereof,
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charged with the collection, safekeeping, transfer or disbursement of public money,
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converts
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to his own
Appellee’s next contention is that any prosecution under §823 is precluded by the special penal provisions of §573 of the Sales Tax Act. Section 573 provides, inter alia, that any person, maintaining a place of business in Pennsylvania and selling or ■ leasing tangible personalty, the sale or use of which is subject to the sales tax, who wilfully fails, neglects-or refuses to collect the tax from the purchaser, and rqmit the tax to the Commonwealth is guilty of a piisdemeanor. Section 573 does not include the offense of embezzlement. While §573 does include a failure to remit the sales tax as an offense, a very essential element of proof essential to a conviction under §823 is not required, i.e., the conversion or appropriation of the collected taxes to the vendor’s use in any way whatsoever. The crimes created under §573 are administrative in nature, require no .proof of monetary gain and are properly classed as misdemeanors.. The crime created under §823 is an entirely different mat
The most complete answer to the contention that §573 precludes prosecution under §823 is provided by §601 (b) of the Sales Tax Act (72 P.S. §3403-601) which provides, inter alia: “the criminal offenses and penalties therefor prescribed by this act [the Sales Tax Act] shall be in addition to any criminal offenses prescribed by the general laws of this Commonwealth, which may arise out of the same transaction or transactions.” (Emphasis supplied). That section leaves applicable the provision of The Penal Code unless such are duplicated by §573 of the Sales Tax Act and there is no duplication of the crime defined in §823 of The Penal Code to be found in §573 of the Sales Tax Act. The essence of §573 is the thwarting of those who would block the administration of the Sales Tax Act; the essence of §823 is the conversion or misappropriation of such tax. If anyone converts taxes to his own use he is guilty of the crime charged by §823. While such conversion might add to the opprobrium of failure to remit under §573 of the Sales Tax Act, it would not be an essential elemént of proof of violation of §573 nor would it alter the legal effect of such violation. Clearly, §601 (b) of the Sales Tax Act demonstrates the legislative intent not to make §573 the exclusive criminal remedy with respect to a failure to remit sales taxes.
Lastly, Shafer urges that it is only the corporation of which he is president, and not himself, as an individual, who can be prosecuted under §823. Such contention is without merit and Shafer, as president arid the principal officer of the corporation, is subject to prosecution under §823. The burden, of course, will be upon the Commonwealth to prove, at the trial, that Shafer personally dominated and controlled all the affairs of the corporation. In
Commonwealth v.
The rationale which underlies the application of §823 to the president in control and domination of a corporation was well expressed by this Court in
Markovitz v. Markovitz,
In summary, we conclude: (1) that §823 of The Penal Code is applicable to anyone, whether a public official or not, who collects and converts or appropriates to his own use any tax monies; (2) that §573(b) of the Sales Tax Act does not preclude a prosecution, under §823 of The Penal Code, of anyone who collects and converts or appropriates sales tax monies; (3) that, if the Commonwealth can prove at trial that Shafer dominated and controlled the corporation of which he was the chief executive officer, Shafer is sub
Orders reversed.
Notes
Shafer, president of a corporation, was indicted for nonpayment to the Commonwealth of sales tax monies allegedly collected by the corporation and not remitted to the Commonwealth; the Court of Quarter Sessions of Allegheny County quashed that indictment. Slosar, a partner in a co-partnership, was indicted on a similar charge; the Court of Quarter Sessions of Allegheny
Act of March 6, 1956, P. L. (1955) 1228, as amended, 72 P.S. §3403-1 et seq.
For example, see: Commonwealth v. Simpson, 74 Pa. D. & C. 313.
The words shall be so construed “except where a different intent is plainly declared in the provision to be construed or is plainly apparent from the context thereof”. (Emphasis supplied).
State ex rel. Foster v. Miller,
136 Ohio. St. 295,
Emphasis supplied.
It will be noted that under §822 the person subject thereto must be one charged with the collection, safekeeping, transfer (as in §823) or disbursement (not in §823) of public money (“taxes” in §823).
As in §823.
To the extent that Commonwealth v. Simpson, 74 Pa. D. & C. 313, indicates a contrary construction of §823, such case is overruled.