New York to recover excise taxes paid and the defendant has appealed.
The facts were stipulated and are as follows: The appellee has operated a restaurant and bar at 123 East 54th St., in the City of New York since January 2, 1942. Shortly after it began doing business it was advised by the Collector of Internal Revenue for the revenue district in which the restaurant was located that it was taxable under § 1700(e) of the Internal Revenue Code as amended by § 542 of the Revenue Act of 1941, 26 U.S.C.A. Int.Rev. Code, § 1700(e). It then filed monthly returns and paid the taxes for thirteen months until February, 1943, when it stopped paying. Thereafter the collector made a full investigation and found that the appellee's restaurant neither was nor had been a cabaret within the above statute and was not taxable thereunder, and, on November 23, 1943, so notified the appellee *69 which filed a claim on November 29, 1943, for the refund of the taxes it had paid. The claim was rejected because the claimant had not borne the burden of the taxes since it had collected the taxes from its patrons and had not refunded them. Then this suit was brought within the time allowed. The appellee concededly charged its patrons and was paid by them, as separate items designated tax on the checks it presented to them, the amount of the taxes it has recovered.
Sec. 1700(e)(1) of the Code as amended levies a "tax equivalent to 5 per centum of all amounts paid for admission, refreshment, service, and merchandise, at any roof garden, cabaret, or other similar place furnishing a public performance for profit, if any payment, or part thereof, for admission, refreshment, service, or merchandise, entitles the patron to be present during any portion of such performance." Subdivision (e)(2) makes the person receiving such payments the taxpayer.
The appellee was admittedly the person receiving such payments and paid as such taxpayer the taxes it seeks to recover. The taxes were admittedly erroneously paid by the appellee and illegally collect