Appendix X-Continued proper expense of such transfer, as ascertained and determined by the Secretary or his delegate, such merchandise may be seized and sold by the Secretary or his delegate in the same manner as goods are sold on distraint for taxes, and the proceeds of such sale shall be applied to the payment of the taxes due thereon and the cost and expenses of such sale and removal, and the balance paid over to the owner of such merchandise. Subchapter D-Rectifying Plants Part I. Establishment. Part II. Operation. PART I-ESTABLISHMENT Sec. 5271. Notice of business of rectifier. Sec. 5272. Bond. Sec. 5273. Premises. Sec. 5274. Sign required on premises. Sec. 5275. Cross references. SEC. 5271. NOTICE OF BUSINESS OF RECTIFIER. (a) REQUIREMENTS.-Every person engaged in, or intending to be engaged in, the business of a rectifier, shall give notice in writing, subscribed by him, to the Secretary or his delegate, stating his name and residence, and if a company or firm, the name and residence of each member thereof, and the name and residence of every person interested or to be interested in the business, the precise place where such business is to be carried on; and if such business is carried on in a city, the residence and place of business shall be indicated by the name of the street and number of the building. The notice shall also state the process by which the applicant intends to rectify, purify or refine distilled spirits, that such rectifying premises are not on the premises of any distillery registered for the distillation of spirits, and such additional particulars, as the Secretary or his delegate may by regulations prescribe. In case of any change in the location, form, capacity, ownership, agency, superintendency, or in the persons interested in the business of such rectifying establishment, notice thereof, in writing, shall be given to the Secretary or his delegate. Every notice required by this section shall be in such form, contain such additional particulars, and be submitted at such time or times, as the Secretary or his delegate may by regulations prescribe. (b) PENALTY. For penalty for violation of this section, see section 5603. SEC. 5272. BOND. (a) REQUIREMENT.-The business of a rectifier of spirits shall be carried on, and the tax on rectified spirits and wines shall be paid, under such bonds as the Secretary or his delegate may by regulations prescribe. (b) APPROVAL OF BOND AS CONDITION TO COMMENCING BUSINESS. For provisions relating to approval of bond as condition to commencing business of a rectifier, see section 5551. SEC. 5273. PREMISES. (a) GENERAL.-The premises of a rectifier shall be as described in his notice and, whether they consist of an entire building or of rooms in a building, shall have means of ingress from and egress into a public street or yard, or into a public hall or elevator shaft leading into a public street or yard, and shall be used exclusively for the business of rectification and the bottling of liquors rectified by him thereon, and the bottling of wines and spirits without rectification. (1) For provisions authorizing the Secretary or his delegate to require installation of meters, tanks, and other apparatus, see section 5552. (2) For penalty for unlawful use of rectifying premises, see section 5627. SEC. 5274. SIGN REQUIRED ON PREMISES. (a) REQUIREMENT.-Every person engaged in rectifying spirits shall, in such manner and form as the Secretary or his delegate may by regulations prescribe, place and keep conspicuously on the outside of the place of such business a sign exhibiting in plain and legible letters the name or firm of the rectifier, with the words: "rectifier of spirits". (b) PENALTY. For penalty for failure to post sign or improperly posting such sign, see section 5681. SEC. 5275. CROSS REFERENCES. (1) For provisions requiring the registration of stills, see section 5174. (2) For provisions requiring permit to set up still, boiler, or other vessel, for distilling, see section 5105. (3) For provisions requiring payment of special (occupational) tax as rectifier, see section 5081, and as wholesale liquor dealer, see section 5111, and as retail liquor dealer, see section 5121. PART II-OPERATION Sec. 5281. Regulation of business of rectifier. Sec. 5282. Rectification of spirits. Sec. 5283. Examination of premises. Sec. 5284. Prohibited hours for removal of distilled spirits. Sec. 5285. Records and returns. Appendix X-Continued SEC. 5281. REGULATION OF BUSINESS OF RECTIFIER. (a) GENERAL.-The business of a rectifier shall be carried on under such regulations as the Secretary or his delegate may prescribe. The Secretary or his delegate may prescribe such regulations under this part and subpart B of part I of subchapter A as he deems necessary. All distilled spirits or wines taxable under sections 5021 and 5022 shall be subject to regulations prescribed by the Secretary or his delegate concerning the use thereof in the manufacture, blending, compounding, mixing, marking, branding, and sale of rectified products. (b) CROSS REFERENCES. (1) For requirement that the premises of a rectifier be used exclusively for rectification and bottling of spirits and wines, see section 5273 (a). (2) For provisions requiring the blending of straight whiskies and pure fruit brandies to be under supervision of a revenue officer and under conditions prescribed by regulations, see section 5025(e). SEC. 5282. RECTIFICATION OF SPIRITS. (a) NOTICE OF INTENTION TO RECTIFY.-When any rectifier intends to rectify or compound any distilled spirits he shall, before dumping any distilled spirits for that purpose, give notice to the Secretary or his delegate of his intention so to rectify. Such notice shall be made in such form and contain such particulars as the Secretary or his delegate may by regulations prescribe. (b) GAUGING, BRANDING, AND STAMPING RECTIFIED SPIRITS.-Whenever any cask or package of distilled spirits containing 5 wine gallons or more is dumped by a rectifier for rectification, or filled and received from rectification for sale, shipment, or delivery, the same shall be gauged, marked, branded and stamped by a storekeeper-gauger, whose duty it shall be to mark and brand the same and place thereon a stamp, which shall be in such form and shall show such information as the Secretary or his delegate may by regulations prescribe; but the Secretary or his delegate may by regulations provide that the gauging, marking, stamping, and branding of such packages so dumped for rectification, or received therefrom, be done by the rectifier instead of by a storekeeper-gauger. (c) AFFIXING STAMPS. The stamps required by this section shall in every case be affixed to a smooth surface of the cask or other package, which surface shall not have been previously painted or covered with any substance, and so as to fasten the same securely to the cask or package, and shall be duly canceled, and shall then be immediately covered with a coating of transparent varnish or other substance, so as to protect them from removal or damage by exposure; and such affixing, cancellation, and covering shall be done in such manner as the Secretary or his delegate may by regulations prescribe. (d) PENALTY.— For penalty for violation of subsections (a) and (b), see section 5630. SEC. 5283. EXAMINATION OF PREMISES. The provisions of section 5196 (c) requiring the giving of assistance to revenue officers for the examination of the premises and section 5196 (d) authorizing revenue officers to break up grounds or walls shall apply in like manner to rectifiers and rectifying premises. SEC. 5284. PROHIBITED HOURS FOR REMOVAL OF DISTILLED SPIRITS. For provisions prohibiting the removal during certain hours of distilled spirits in any cask or package containing more than 10 gallons, see section 5195(b). SEC. 5285. RECORDS AND RETURNS. (a) MONTHLY RETURNS.-Every person engaged in rectifying or compounding distilled spirits shall, on or before the 10th day of every month, render to the Secretary or his delegate a monthly return of the operations of the preceding month, taken from his records, in such form and manner, and containing such information, as the Secretary or his delegate may by regulations prescribe, (b) RECORD OF RECTIFIER AS WHOLESALE DEALER.-Every rectifier who sells, or offers for sale, distilled spirits in quantities of 5 wine-gallons or more to the same person as the same time shall keep daily a record of distilled spirits received and disposed of by him, in such form, at such place and containing such information as the Secretary or his delegate may by regulations prescribe. Such rectifiers shall also render such correct transcripts, summaries, and copies of heir records at such times and in such form and manner as the Secretary or his delegate may by regulations require. The records required to be kept under this section, and regulations issued pursuant thereto, shall be preserved for a period of 2 years, and during such period shall be available during business hours for inspection and the taking of abstracts therefrom by the Secretary or his delegate. (c) PENALTY. For penalty for refusal or neglect of rectifier to keep records required under subsection (b), or for false entries therein, Subchapter E-Industrial Alcohol Plants, Bonded Warehouses, Denaturing Part I. Industrial alcohol plants, bonded warehouses, and denaturing plants. PART I-INDUSTRIAL ALCOHOL PLANTS, BONDED WAREHOUSES, AND Sec. 5301. Establishment of industrial alcohol plants. Sec. 5302. Establishment of industrial alcohol bonded warehouses. Appendix X-Continued Sec. 5304. Alcohol permits. Sec. 5305. Regulations for establishing, bonding, and operation of plants and ware houses. Sec. 5306. Exemption of industrial alcohol plants and warehouses from certain laws. Sec. 5308. Transfer of alcohol to other plants or warehouses. Sec. 5309. Withdrawal of fermented liquors to industrial alcohol plants. Sec. 5310. Withdrawal of alcohol free of tax. Sec. 5311. Importation of alcohol for industrial purposes. Sec. 5312. Remission and refund of tax on alcohol for loss or leakage. Sec. 5313. Powers and duties of persons enforcing this part. Sec. 5314. Officers and agents authorized to investigate, issue search warrants, and Sec. 5315. Compliance with court subpoena as to testifying or producing records. Sec. 5317. Applicability of other laws. Sec. 5318. Application of part to Puerto Rico and Virgin Islands. Sec. 5319. Definitions, etc. Sec. 5320. Cross references. SEC. 5301. ESTABLISHMENT OF INDUSTRIAL ALCOHOL PLANTS. Any person establishing a plant for the production of industrial alcohol shall before operation, make application to the Secretary or his delegate for registration of his plant, file bond, and receive permit for the operation of such plant. SEC. 5302. ESTABLISHMENT OF INDUSTRIAL ALCOHOL BONDED WAREHOUSES. Warehouses for the storage and distribution of alcohol may be established on filing of application and bond and issuance of permit at such places, either in connection with the manufacturing plant or elsewhere, as the Secretary or his delegate may determine; the entry and storage of alcohol therein and the withdrawals of alcohol therefrom shall be made in such containers and by such means as the Secretary or his delegate by regulation may prescribe. Permanent tanks and other structures located on the industrial alcohol plant premises and approved by the Secretary or his delegate shall be deemed to be warehouses within the meaning of this section. SEC. 5303. ESTABLISHMENT OF INDUSTRIAL ALCOHOL DENATURING PLANTS. On the filing of application and bond and issuance of permit, denaturing plants may be established on 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. 5304. ALCOHOL PERMITS. (a) GENERAL RULE. (1) PERMIT REQUIRED.-No one shall manufacture alcohol, procure it tax-free, denature it, deal in or use specially denatured alcohol, recover completely or specially denatured alcohol, or transport specially denatured or tax-free alcohol, without first obtaining a permit from the Secretary or his delegate so to do. All such permits may be issued for 1 year, and shall expire on the 31st day of December next succeeding the issuance thereof: Provided, That the Secretary or his delegate may without formal application or new bond extend any permit granted under this part after August 31 in any year to December 31 of the succeeding year. (2) AUTHORITY TO PRESCRIBE REGULATIONS.- -Permits to purchase or procure specially denatured alcohol and tax-free alcohol shall be issued in such terms and under such conditions as the Secretary or his delegate may by regulation prescribe. (3) RESTRICTION ON ISSUANCE OF PERMITS.-No permit shall be issued to any person who, within 1 year before the application therefor or issuance thereof, shall not in good faith have conformed to the provisions of this chapter, or shall have violated the terms of any permit issued under this section, or made any false statement in the application therefor, or willfully failed to disclose any information required by regulation to be furnished, or violated any law of the United States relating to intoxicating liquor, or willfully violated any law of any State, Territory, or possession of the United States or of the District of Columbia relating to intoxicating liquor. (4) FORM OF APPLICATION AND PERMIT.-Every permit shall be in writing, dated when issued, and signed by the Secretary or his delegate. It shall give the name and address of the person to whom it is issued and shall designate and limit the acts that are permitted and the time when and place where such acts may be performed. No permit shall be issued until a verified, written application shall have been made therefor, setting forth the qualification of the applicant and the purpose for which the alcohol or denatured alcohol is to be used. The Secretary or his delegate may prescribe the form of all permits and applications and the facts to be set forth therein. (5) BOND REQUIREMENT. Before any permit is granted, the Secretary or his delegate may require a bond, in such form and amount as he may prescribe, to insure compliance with the terms of the permit and the provisions of this chapter. (6) REVIEW OF DISAPPROVAL.—In the event of the refusal by the Secretary or his delegate of any application for a permit, the applicant may have a review of his decision before a court with equity jurisdiction, in the manner provided in subsection (c). Appendix X-Continued (b) REVOCATION OF PERMIT.-If at any time there shall be filed with the Secretary or his delegate a complaint under oath setting forth facts showing, or if the Secretary or his delegate has reason to believe, that any person who has a permit is not in good faith conforming to the provisions of this chapter, or has violated the terms of such permit, or has made any false statement in the application therefor, or has willfully failed to disclose any information required by regulation to be furnished, or has violated any law of the United States, or of any State, Territory, or possession of the United States, or of the District of Columbia, relating to intoxicating liquor, the Secretary or his delegate shall immediately issue an order citing such person to appear before him on a day named not more than 30 nor less than 15 days from the date of service on such permittee of a copy of the citation, which citation shall be accompanied by a copy of such complaint, or in the event that the proceedings be initiated by the Secretary or his delegate, with a statement of the facts constituting the violation charged, at which time a hearing shall be had unless continued for cause. Such hearing shall be held within the judicial district and within 50 miles of the place where the offense is alleged to have occurred unless the parties agree on another place. If it be found that such person is not in good faith conforming to the provisions of this chapter or has violated the terms of his permit, or made any false statement in the application therefor, or willfully failed to disclose any information required by regulation to be furnished, or violated any law of the United States relating to intoxicating liquor, or willfully violated any law of any State, Territory, or possession of the United States or of the District of Columbia relating to intoxicating liquor, such permit shall be revoked, and no permit shall be granted to such person within 1 year thereafter. Should the permit be revoked by the Secretary or his delegate, the permittee may have a review of his decision before a court with equity jurisdiction in the manner provided in subsection (c). During the pendency of such action such permit shall be temporarily revoked. (c) INACCURATE DESCRIPTION OF DENATURED ARTICLES.-Whenever the Secretary or his delegate has reason to believe that denatured alcohol, denatured rum, or articles do not correspond with the descriptions and limitation as to such alcohol, rum, or articles provided by law and regulations, he shall cause an analysis of such alcohol, rum, or articles to be made, and if on such analysis the Secretary or his delegate shall find that such alcohol, rum, or articles do not so correspond, he shall give not less than 15 days' notice in writing to the person who is the manufacturer thereof to show cause why such alcohol, rum, or articles should not be dealt with as other distilled spirits, such notice to be served personally or by registered mail, as the Secretary or his delegate may determine, and shall specify the time when, the place where, and the name of the agent or official before whom, such person is required to appear. If the manufacturer of such alcohol, rum, or articles fails to show to the satisfaction of the Secretary or his delegate that the alcohol, rum, or articles manufactured by him correspond to the descriptions and limitations as to such alcohol, rum, or articles provided by law and regulations, his permit to manufacture and sell the same shall be revoked. The manufacturer may by appropriate proceeding in a court with equity jurisdiction have the action of the Secretary or his delegate reviewed, and the court may affirm, modify, or reverse the finding of the Secretary or his delegate as the facts and law of the case may warrant, and during the pendency of such proceeding, may restrain the manufacture, sale, or other disposition of such alcohol, rum, or articles. (d) PROVISIONS RELATING TO VENUE. In case of a sale of liquor or denatured alcohol or denatured rum, where the delivery thereof was made by a common or other carrier, the sale and delivery for purposes of prosecution or revocation of any permit shall be deemed to be made in the county or district wherein the delivery was made by such carrier to the consignee, his agent or employee, or in the county or district wherein the sale was made, or from which the shipment was made, and prosecution for such sale or delivery may be had in any such county or district. SEC. 5305. REGULATIONS FOR ESTABLISHING, BONDING, AND OPERATION OF PLANTS AND WAREHOUSES. The Secretary or his delegate shall issue regulations respecting the establishment, bonding, and operation of industrial alcohol plants, denaturing plants, and bonded warehouses authorized by this subchapter, and the distribution, sale, export, and use of alcohol which may be necessary, advisable, or proper, to secure the revenue, to prevent diversion of the alcohol to illegal uses, and to place the nonbeverage alcohol industry and other industries using such alcohol as a chemical raw material or for other lawful purpose on the highest possible plane of scientific and commercial efficiency consistent with the interests of the Government, and which shall insure an ample supply of such alcohol and promote its use in scientific research and the development of fuels, dyes, and other lawful products. SEC. 5306. EXEMPTION OF INDUSTRIAL ALCOHOL PLANTS AND WAREHOUSES FROM CERTAIN LAWS. Industrial alcohol plants and bonded warehouses established under this part shall be exempt from section 5082 and the special taxes imposed by part II of subchapter A and from sections 5116, 5171, 5172, 5173 (a) and (b), 5174, 5175, 5176, 5178, 5179, 5180, 5191, 5192 (b), (c) and (d), 5193, 5195, 5196 (a) and (e), 5197, 5231, 5232, 5241(c), 5242, 5244, 5250, 5271, 5274, 5551, 5625 and 5640, and from such other provisions of law relating to distilleries and bonded warehouses as may by regulations be deemed inapplicable to industrial alcohol plants and bonded warehouses established under this part. Regulations may be made embodying any provisions of part II of subchapter A or of the sections above enumerated. SEC. 5307. PRODUCTION, USE OR SALE OF ALCOHOL. Alcohol may be produced at any industrial alcohol plant established under this part, from any raw materials or by any processes suitable for the production of alcohol, and, under regulations, Appendix X-Continued may be used at any industrial alcohol plant or bonded warehouse or sold or disposed of for any lawful purpose. SEC. 5308. TRANSFER OF ALCOHOL TO OTHER PLANTS OR WAREHOUSES. Alcohol produced at any registered industrial alcohol plant or stored in any bonded warehouse may be transferred, under regulations, to any other registered industrial alcohol plant or bonded warehouse for any lawful purpose. SEC. 5309. WITHDRAWAL OF FERMENTED LIQUORS TO INDUSTRIAL ALCOHOL PLANTS. 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 percent 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 industrial alcohol plant and the operation of such plant and removal of the residue therefrom shall be under the supervision of such officer or officers as the Secretary or his delegate shall deem proper, and the Secretary or his delegate is hereby authorized to make such regulations as may be necessary to give force and effect to this section and to safeguard the revenue. SEC. 5310. WITHDRAWAL OF ALCOHOL FREE OF TAX. (a) FOR DENATURATION.—Alcohol produced at any industrial alcohol plant or stored in any bonded warehouse may, under regulations, be withdrawn tax-free, as provided by existing law from any such plant or warehouse for transfer to any denaturing plant for denaturation, or may, under regulations, before or after denaturation, be removed from any such plant or warehouse for any lawful tax-free purpose. Alcohol lawfully denatured may, under regulations, be sold free of tax either for domestic use or for export. (b) FOR USE BY FEDERAL OR STATE AGENCIES.-Alcohol may be withdrawn tax-free, under regulations, from any industrial alcohol plant or bonded warehouse by the United States or any governmental agency thereof, or by the several States and Territories or any municipal subdivision thereof or by the District of Columbia. Alcohol may be withdrawn tax-free from customs custody by the United States or any governmental agency thereof for its own use, under such regulations as may be prescribed. (c) USE IN RESEARCH, HOSPITALS, OR FOR CHARITABLE CLINICS.-Alcohol may be withdrawn, under regulations, from any industrial alcohol plant or bonded warehouse tax-free for the use of any scientific university or college of learning, for any laboratory for use exclusively in scientific research, or for use in any hospital or sanitarium, or for the use of any clinic operated for charity and not for profit, including use in the compounding of bona fide medicines for treatment outside of such clinics of patients thereof, but not for sale. (d) CONDITIONS OF EXEMPTIONS.-Any person permitted to obtain alcohol tax-free, except the United States and the several States and Territories and subdivisions thereof, and the District of Columbia, shall first apply for and secure a permit to purchase the same and give the bonds prescribed under section 5304, but alcohol withdrawn for nonbeverage purposes for use of the United States and the several States, Territories, and subdivisions thereof, and the District of Columbia may be purchased and withdrawn subject only to such regulations as may be prescribed. SEC. 5311. IMPORTATION OF ALCOHOL FOR INDUSTRIAL PURPOSES. Under regulations, and subject from the time of its withdrawal from customs custody to all the applicable provisions of this part, alcohol of 160 proof, or greater, may be imported into the United States and be withdrawn, in bond, from customs custody, without payment of the internal revenue tax imposed by section 5001 upon the act of importing such alcohol, for transfer to industrial alcohol plants, alcohol bonded warehouses, and denaturing plants for redistillation or denaturation and withdrawal, or withdrawal without redistillation or denaturation, tax-free or taxpaid, as the case may be, for all the purposes authorized by this part. SEC. 5312. REMISSION AND REFUND OF TAX ON ALCOHOL FOR LOSS OR LEAKAGE. For provisions relating to remission or refund of tax on alcohol for loss or leakage, see section 5011(c). SEC. 5313. POWERS AND DUTIES OF PERSONS ENFORCING THIS PART. (a) SECRETARY AND OTHER PERSONS.-The Secretary, his assistants, agents, and inspectors, and all other officers, employees, or agents of the United States, whose duty it is to enforce criminal laws, shall have all the rights, privileges, powers, and protection in the enforcement of the provisions of this part or section 5686 which are conferred by law for the enforcement of any laws in respect of the taxation, importation, exportation, transportation, manufacture, possession, or use of, or traffic in, intoxicating liquors. (b) POWER TO SECURE RECORDS.-All records and reports kept or filed under this part, and all liquor or property to which such records or reports relate, shall be subject to inspection at any reasonable hour by the Secretary or any of his agents or by any public prosecutor or by any person designated by him, or by any peace officer in the State where records or reports are kept, and copies of such records and reports duly certified by the person with whom kept or filed may be introduced in evidence with like effect as the originals thereof, and verified copies of such records shall be furnished to the Secretary or his delegate when called for. SEC. 5314. OFFICERS AND AGENTS AUTHORIZED TO INVESTIGATE, ISSUE SEARCH WARRANTS, AND PROSECUTE FOR VIOLATIONS. The Secretary, his assistants, agents, and inspectors, shall investigate and report violations of this chapter or of section 7302 to the United States Attorney for the district in which committed, who is hereby charged with the duty of prosecuting the offenders, subject to the direction of the |