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Opinion.

privileges" as would have been had by the Chesapeake and Ohio Railroad Company but for such foreclosure.

The West Virginia Constitution of 1863, (Art. II, sec. 5) as well as the Code of West Virginia, 1868, chapter 53, section 8, reserved to the legislature the right to alter or repeal at its pleasure the charter of any company granted under general laws, and by an act approved January 31, 1879 (Acts 1879, c. 5), its legislature amended the act incorporating the Covington and Ohio Railroad Company so as to omit therefrom the clause containing the right of exemption from taxation, and by an act of March 7, 1879 (Acts 1879, c. 73), subjected the railroad company's property to taxation.

The Supreme Court of the United States in the case of Chesapeake & Ohio Railroad Co. v. Miller, 114 U. S. 176, 5 Sup. Ct. 813, 29 L. Ed. 121, decided in 1885, held that the railway company was incorporated under general law and that "the exemption thus conferred did not take effect as a contract, protected from repeal by the Constitution of the United States."

The legislature of Virginia took no similar action and neither the Board of Public Works, nor the defendant company, had any reason to believe that the same court would hold that the portion of the road between Covington and the West Virginia line was not exempt from taxation.

In Lake Drummond Canal, etc., Co. v. Commonwealth, 103 Va. 337, 49 S. E. 506, 68 L. R. A. 92, the court held that an exemption from taxation to the Dismal Swamp Company did not pass to the purchaser at a foreclosure sale under the words, "franchise, rights and privileges," of section 1234 of the Code of 1887 (Acts 1840-41, supra). This decision was handed down in 1905, too late to guide the Board of Public Works in the discharge of its duties during the years 1879 to 1901, inclusive.

Opinion.

Under the act approved March 27, 1876 (Acts 187576, c. 162), in force in 1879, each railroad company in the State was required to make an annual report to the Auditor of Public Accounts, with a detailed description and estimate of the value of its railway, depots, etc.; whose duty it was to bring such report before the Board of Public Works as a basis for its assessment for taxation. Another report required to be made to the Auditor of Public Accounts for the purpose of assessing railroads with their pro rata share of the expense of maintaining the office of Railroad Commissioner, called for the total mileage in the State, and in this report the company stated its total mileage, without deduction for the eighteen miles claimed to be exempt.

After 1881 (Acts 1881-2, p. 497) the railroads were required by statute to report the mileage subject to taxation in each county, and the railway company reported 19.48 miles in Alleghany county, when its total mileage in that county was 37.49 miles, the difference of eighteen miles being a part of the old Covington and Ohio Railroad west of Covington.

The last mentioned report to the Auditor of Public Accounts who, as stated, was a member of the Board of Public Works, called for the total mileage in the State, and the railway company reported it to be 2251⁄2 miles, without deduction for that portion claimed to be exempt.

The Chesapeake and Ohio Railway Company in accordance with the decision in C. & O. R. Co. v. Comth., supra, the general statute and the act of 1879, supra, continued to make such reports as the railroad company had made, calling attention in the report, with few exceptions, to the fact that the 2071⁄2 miles it was reporting included only the mileage "subject to taxation." The reports for the purposes of assessment were so made

Opinion.

from 1878 to 1901, inclusive.

The company having earned ten per centum on its capital in 1902, in 1903 it reported its full mileage at 2251⁄2 miles and its mileage in Alleghany county at 37.49 miles.

By the act of March 6, 1882 (Acts 1881-82, c. 221), the board of supervisors were authorized to order the levy on real and personal property of railroad companies, which pass through their respective counties, except such as are exempt from county or other local taxes, based upon the assessment per mile made by the State for its purposes and furnished by the Auditor of Public Accounts to said boards.

The board of supervisors of Alleghany county from 1880 to 1902 levied county and district taxes on that part of the road in their county which was formerly known as the Virginia Central Railroad.

The only assignment of error is the action of the Commission in determining that the railway company is protected from the assessment of the property in question by paragraph 7, of section 508, of the Code of 1887, as amended by the act of 1916 (Acts 1916, c. 491).

[2, 3] The railway company challenges the jurisdiction of the Commission, and the right of the board of supervisors of Alleghany county to maintain the proceeding, pleads the statute of limitations and laches, and asserts that the several valuations of the railroad company's properties by the Board of Public Works were final and conclusive.

As to the jurisdiction of the Commission there can be no doubt. Under section 156 (a) of the Constitution of Virginia, the State Corporation Commission succeeded to all powers and duties of the Railroad Commissioner and the Board of Public Works. Section 508, Code of 1887, as amended by the act of 1916, pro

Opinion.

vides in terms that "if the commissioner of the revenue, examiner of records, or other assessing officer, commission or board designated by law to assess persons, property (real, personal and mixed)

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ascertain

that any person or real or personal property has not been assessed for taxation for any year by the State, county, district, city or town, or that the same has been assessed at less than the law required, for any year, or that the taxes, levies, et cetera, thereon, for any cause have not been realized, it shall be the duty of the commissioner of the revenue, examiner of records, or other assessing officer to list the same and assess persons, property (real, personal and mixed), and levies at the rate prescribed for that year.

It appearing that the eighteen miles of railroad in question was not assessed and taxed for the years in controversy, it follows that it was the duty of the Commission to value the same and assess the omitted State taxes thereon, unless there be found in the statutes some provision which would operate to exempt the company from such taxation.

[4] The board of supervisors of Alleghany county had nothing to do with the assessment of this property for taxation, their only duty being to lay the county and district levies thereon upon the basis of the assessment valuations duly made by the Commission. board has been guilty of no laches which can defeat its right to tax the property in question, nor does the statute of limitations run against it.

The

[5] Paragraph 7 of section 508 of the Code, as amended in 1916 (2336 Code of 1919), reads as follows: "In the case of omitted taxes, wherever the taxpayer has made full disclosure of his taxable property (real estate, tangible or intangible personal property, money and income), and in cases of tangible and intangible personal property, money and income, has enumerated on his

Opinion.

returns the items thereof, and there has been an assessment made in good faith by the tax officer, although made under misapprehension of the laws, such assessment as to the valuation of such property shall be final; but in cases in which there has not been a full disclosure and enumeration on his tangible and intangible personal property, income and money, whether intentional or otherwise, such assessment shall not be considered final, but in contested cases the burden shall be upon the taxpayer to show that he has made a full disclosure."

Before the exemption provided for in paragraph 7 can become operative, it is necessary, first, that the taxpayer make a full disclosure of his taxable property to the official charged with the duty of assessing the same, second, that there be an assessment in good faith by the assessing officer, and, third, an innocent error on the part of the assessing authority as a result of a misapprehension of the law.

[6] The Commonwealth admits that if the railway company made a full disclosure of its taxable property, including the eighteen miles in question, and the Board of Public Works made the assessment in good faith and erroneously determined that the eighteen miles were not assessable, as a matter of law, the valuation they placed upon the entire mileage is final.

[7] It is manifest that the object of the legislature in requiring the taxpayer to make a "full disclosure" was to make certain that the assessing officers received information as to all taxable property owned by him. When the taxpayer's report of his taxable property, though not technically full and complete, gives information which, when added to the information the assessing authorities received from other sources, puts them in possession of the same facts they would have been possessed of if the taxpayer had made a report in strict

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