FRANKFURTER, J., dissenting. 330 U.S. any event, I do not think the argument of counsel for a taxpayer urging relief should carry more weight than the use by Congress of settled tax language, carrying a meaning which excludes that result, a meaning which is reenforced by the legislative, judicial and administrative history that led up to and followed the enactment. See Century Electric Co. v. Commissioner, 144 F. 2d 983, affirming the Tax Court, 3 T. C. 297; S. Rep. No. 1631, 77th Cong., 2d Sess., pp. 244-46; Treasury Regulations 94 and 101, Art. 115-11; Treasury Regulations 103, § 19.115-11; Treasury Regulations 111, § 29.115-11. The short of the matter is, that even though corporate profits here were withheld because Louisiana forbade their distribution, there can be no credit allowed for a deficit because in a federal tax sense there was no deficit. No doubt Congress, to some extent, desired to relieve from the undistributed profits tax corporations forbidden by State law from declaring dividends. But neither what Congress enacted nor its legislative history indicates a purpose to disregard the limiting provisions of § 115 (h) of the Revenue Act of 1936.3 This section, which embodies the analysis of Commissioner v. Sansome, 60 F. 2d 931, 3 49 Stat. 1648, 1688-89. § 115 (h): "EFFECT ON EARNINGS AND PROFITS OF DISTRIBUTIONS OF STOCK.-The distribution (whether before January 1, 1936, or on or after such date) to a distributee by or on behalf of a corporation of its stock or securities or stock or securities in another corporation shall not be considered a distribution of earnings or profits of any corporation "(1) if no gain to such distributee from the receipt of such stock or securities was recognized by law, or "(2) if the distribution was not subject to tax in the hands of such distributee because it did not constitute income to him within the meaning of the Sixteenth Amendment to the Constitution or because exempt to him under section 115 (f) of the Revenue Act of 1934 or a corresponding provision of a prior Revenue Act. As used in this subsection the term 'stock or securities' includes rights to acquire stock or securities." 709 FRANKFURTER, J., dissenting. see S. Rep. 2156, 74th Cong., 2d Sess., p. 19, requires that in respect to federal taxes, assets be treated as available for distribution as earnings regardless of stock dividends which capitalize earnings and profits. H. Rep. No. 2894, 76th Cong., 3d Sess., p. 41, cited in Commissioner v. Wheeler, 324 U. S. 542, 546. The specific example cited by the Senate Committee Report on § 501 of the Revenue Act of 1942 shows that Congress intended to limit the relief afforded by the amendment to cases where the deficit in question had not resulted from the capitalization of accumulated earnings and profits. The majority finds a difference between capitalization of earnings in a nontaxable reorganization and capitalization of earnings by a simple stock dividend. The circumstances are different but the difference is not significant for the legal effect of the stock dividend on earnings and profits. The example given is concerned with the effect of capitalizing earnings and profits, not with the method. If Congress meant to relieve undistributed earnings and profits even though those earnings and profits were considered available under § 115 (h), it should have said so. We think the judgment of the Circuit Court of Appeals should be reversed. * S. Rep. No. 1631, 77th Cong., 2d Sess., pp. 245-46: "(1) The X corporation for the calendar year 1936 had an adjusted net income of $200,000 . . . . "(2) Assume in the above example that the deficit in accumulated earnings and profits is $20,000 for income tax purposes, but the deficit in accumulated earnings and profits on the corporation's books by reason of a prior capitalization of surplus in the course of a nontaxable reorganization amounts to $250,000. In this case, although the State law would probably prohibit payment of any dividends, the credit allowed under the amendment to section 26 (c) is limited to $20,000, which is the deficit in accumulated earnings and profits for income tax purposes. X corporation, therefore, will be liable for undistributed profits surtax on $180,000 of its adjusted net income." 330 U.S. Opinion of the Court. UNITED STATES v. LEM HOY. APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF CALIFORNIA. No. 585. Argued March 14, 1947.-Decided April 7, 1947. 1. Section 5 (g) of the Farm Labor Supply Appropriation Act of 1944 does not except agricultural laborers from the provision of § 5 of the Immigration Act of 1917 making it a criminal offense to induce to migrate to the United States as contract laborers aliens who are not entitled to enter the United States under the 1917 Act or any other law of the United States. Pp. 730-731. 2. Since dismissal of the information in this case was based on the construction of the 1917 Act as the Government sought to apply it in the information, the case was properly brought to this Court on direct appeal from the district court. P. 725. Reversed. A United States District Court dismissed an information charging a violation of § 5 of the Immigration Act of 1917, 39 Stat. 874, by inducing aliens to migrate to the United States as contract laborers-on the ground that § 5 (g) of the Farm Labor Supply Appropriation Act of 1944, 58 Stat. 11, excepts agricultural laborers from the provisions of the 1917 Act. On direct appeal to this Court, reversed, p. 731. Peyton Ford argued the cause for the United States. With him on the brief were Acting Solicitor General Washington, Robert S. Erdahl and Sheldon E. Bernstein. Henry G. Bodkin submitted on brief for respondent. MR. JUSTICE BLACK delivered the opinion of the Court. A United States Attorney filed an information in a Federal District Court charging that the appellee, Lem Hoy, "did attempt to induce, assist, encourage, and solicit, 724 Opinion of the Court. certain alien persons to migrate to the United States as contract laborers . . . who were not alien contract laborers duly entitled to migrate to the United States under the Act of February 5, 1917, or to enter or migrate to the United States under any other law of the United States, as the defendant then and there well knew." The conduct charged was made an offense by § 5 of the 1917 Immigration Act referred to in the information. 39 Stat. 874, 879, 8 U. S. C. § 139. Hoy appeared, waived indictment, asked for a bill of particulars, and moved to dismiss the information on the ground that § 5 of the 1917 Act had been repealed by § 5 (g) of the Farm Labor Supply Appropriation Act of 1944. 58 Stat. 11, 15-16, 50 U. S. C. App., Supp. V, § 1355 (g). The bill of particulars showed that Hoy had written a letter to certain persons living in Mexico to induce them to come to the United States to work for him. In the letter Hoy told them that "it makes no difference if you pass as contraband (smuggle in), as wherever the Immigration catches you I will get you out with a bond." The letter also directed the aliens to see a man near the border who would "bring" them to Hoy for $25, and stated that Hoy would "arrange everything." It was stipulated that Hoy wanted the men to work for him as agricultural laborers. Holding that the 1944 Farm Labor Act had made the 1917 Act inapplicable to such farm laborers, and therefore to those who induced their entry, the District Court dismissed the information. Since this dismissal was based on the construction of the 1917 Act as the Government sought to apply it in the information, the case is properly here on direct appeal from the District Court. 18 U. S. C. Supp. V § 682, 28 U. S. C. § 345. The 1944 Farm Labor Act, by its terms, was designed to facilitate the wartime employment, and therefore the immigration into the United States for a limited stay, of Opinion of the Court. 330 U.S. agricultural laborers from North, South, and Central America, and islands adjacent thereto. In determining whether this information was properly dismissed, it is appropriate for us to consider whether Congress intended in the 1944 Act to remove all restrictions, enforceable by sanctions, against immigration into the United States of such agricultural laborers from the western hemisphere; and at the same time whether it intended to repeal, not only the provision which prohibited contract laborers from entering the country, but also the long-standing law which made it a criminal offense to induce such persons, barred by law, to enter. If the 1944 Act has these effects, it marks a complete reversal of the congressional policy which has been followed for more than half a century.2 In line with this policy, the purpose of the 1917 Act, according to its title, was "To regulate the immigration of aliens to, and the residence of aliens in, the United States." It provided detailed qualifications for persons to be admitted to the country. Certain persons were to be completely barred, such as idiots, epileptics, chronic alcoholics, vagrants, criminals, polygamists, prostitutes, persons afflicted with loathsome or dangerous contagious diseases, persons who advise, advocate, or teach opposition to organized government or its overthrow by force, illit 1 Compare 39 Stat. 894, 8 U. S. C. § 163 (crime to aid or assist any person to enter who believes in violent overthrow of government); 39 Stat. 880, 43 Stat. 166, 8 U. S. C. § 145 (crime to bring to the United States an alien with certain diseases); 45 Stat. 1551, 8 U. S. C. § 180a (crime for alien to enter at any place other than at an immigration point, or to elude examination). See also 35 Stat. 1152, 18 U. S. C. § 550 which provides that "Whoever directly commits . . . an offense defined in any law of the United States, or aids, abets, counsels, commands, induces, or procures its commission, is a principal." 2 See 23 Stat. 332; 32 Stat. 1213; 34 Stat. 898; 41 Stat. 1008; Holy Trinity Church v. United States, 143 U. S. 457, 463–465. |