performing the duties of the grade to which he was so appointed or commissioned."

But the language here used does not require that he should have been then performing the duties of his grade in the particular command, regimental or company, to which he was thus appointed. If he were at the time performing the duties of that grade in any command, that satisfies this requirement. The requirement is not that he shall have been in the performance of the duties of the office to which he was appointed-for instance, colonel of the Sixty-seventh Regiment or captain of Company F of that regiment-but only that he was performing the duties of the grade to which he was appointed. And this was also the case in the remaining portions of this proviso relating to an officer being considered as mustered from the time, subsequent to that from which he was to take rank, that "he may have entered upon such duties,"

Fourth. While the first proviso makes the date from which the officer is to take rank the time at which the conditions for his constructive muster must exist, the second proviso changes this, as to the cases there mentioned, and fixes "the date of issue of his appointment or commission" as the time when, in the cases named, something other than the actual performance of the duties of the grade shall take the place of such performance, and provides that, in such cases the officer shall be entitled to all the benefits of the act as if he had been actually performing the duties of the grade "at that date," namely, the date of his appointment. But he is entitled to this only in case "a vacancy existed for him" in that grade at the time of his appointment. And this vacancy is the same legal vacancy referred to earlier in the act, and is one to which, consistently with the then laws and regulations, such officer could have been appointed. But here, also, with reference to the time when this vacancy must have existed in order to entitle the officer to the benefits of the act, I hesitate to disturb an existing practice of your Department, if there be any upon the subject, and refer to what I have already said upon this subject.

Fifth. The third proviso limits the provisions of the act to cases where the commission bears date prior to June

20, 1863, or those "after that date when the commands of the persons appointed or commissioned were not below the minimum number required by then-existing laws and regulations."

The language of this proviso is peculiar. In the first part it limits the application of the act to cases of “commissions," and in the latter part speaks of persons “appointed or commissioned." All through the act it speaks of appointments or commissions," and makes provision for both as though there might have been-as doubtless there might-valid appointments not evidenced by any formal commission; and, by the express terms of the act, it applies as well to persons "appointed "as to those "commissioned." But the first part of this proviso would forbid the application of any part of the act to persons merely appointed," and thus contradict and nullify what is before expressly enacted, unless we read it as including persons "appointed, or commissioned," as in the other portions of the act, and this, I think, is its proper construction.

Read in this way, the third proviso limits the application of the act to the cases thereinbefore stated, where the appointments or commissions bore date before June 20, 1863, and to those of a later date when the commands of the persons appointed or commissioned were not below the minimum number required.

The office of this proviso is to limit the application of the act to the cases named in the proviso. It does not make any change in the terms, conditions, or requirements of the previous portions of the act; nor does the latter portion refer to any different time from that previously stated with reference to the same matter. Hence, the time here referred to, when the command must not be below the minimum strength, is the date from which the officer is entitled to the benefits of the act under its previous provisions, and this may be, in one case, the date from which he is to take rank as in the first proviso; or, in another case, the date of issue of his appointment or commission, as in the second proviso. And the second proviso changes the conditions and requirements of the first only in so far that it makes imprisonment, absence by reason of wounds, or being in the hospital because

of disability received in the service in the line of duty, the equivalent of or substitute for being engaged in the performance of the duties of his grade at the date of his appointment. But, with reference to the time when the command must have been of the minimum strength, as stated in the latter portion of the third proviso, I refer also to what I have already said as to any practice in your Department of giving recognition to an officer otherwise entitled, from a date after that of his appointment, when his command has regained its minimum strength.

Sixth. The remaining questions submitted relate to the continuance or permanency of the recognition to which an officer may be entitled under this act, and the answer is indicated in what I have already said. When an officer is duly appointed or commissioned and mustered into the service in a certain grade, he is, to all intents and purposes, such officer de facto and de jure with all the incidents of such office, one of which is, that he can not be removed from office except in accordance with law, or regulations having the force of law; and when a statute, speaking of an antecedent date, says that such duly appointed or commissioned officer, who in fact lacks nothing but muster in to be such officer de jure, shall be thereafter held and considered to have been mustered in from a certain date, it in effect says that he shall be held and considered as such officer from that date, and with all the incidents of such office. Of course, such a statute can not relate back so as to make one actually an officer at the date named, who was not one at that date; but the statute, speaking in the present and future tense, may say, as this statute in effect does say, that now and hereafter such person shall be held and considered as such officer, and, when this is said without qualification, the meaning is as broad as the language, and is that he shall be at all times so held and considered. The act does not say that he shall be so held and considered while or during the time of the existence or continuance of the conditions named, but says that he shall be so held and considered without any limitation whatever of time or conditions, and therefore we can not attach any. If this were otherwise, then, in the case, for example, of a sergeant

appointed lieutenant January 1, 1862, in a company which on February 1 was reduced below the minimum and regained it on March 1, we might have the legally impossible anomaly of the same person a lieutenant for one month, an enlisted man for the next, and a lieutenant after, and all with but one appointment. This can not be. The status or grade of an officer does not fluctuate with the changes of his particular command, nor does the recognition of such officer under the act in question; but just as in the case of an officer actually mustered, he is to be recognized as of that grade until he is promoted to a higher, dies, is discharged from the service, or disposed of in some other way provided by law.

Respectfully,

The SECRETARY OF WAR.

JOHN W. GRIGGS.

WAR-REVENUE ACT-BANKERS-SURPLUS.

The "undivided profits" or "profit and loss" accounts of banking institutions are not taxable as surplus under section 2 of the war-revenue act of June 13, 1898 (30 Stat., 448).

In enacting this law Congress meant to tax only the capital of a bank in its strict technical sense under the banking laws; and in taxing surplus, it meant the fund formally set apart by the authorized officers of the bank as surplus, and not the undivided profits of the institution. Opinion of February 4, 1899 (22 Opin., 320), reaffirmed.

DEPARTMENT OF JUSTICE,

December 27, 1900.

SIR: I have the honor to acknowledge the receipt of your letter of June 7, 1900, in which you ask my opinion as to whether the "undivided profits" or "profit and loss" account are taxable as capital and surplus under section 2 of the act of June 13, 1898. It appears from your letter that this question arises from two claims for refunds made respectively by the Girard Trust Company and the Philadelphia Trust Company. In the claim of the Girard Trust Company, the return shows that its capital is $1,000,000, and its undivided profits, for 1898, were $2,635,298.99, and for 1899, $2,617,439.74. In the claim of the Philadelphia

Trust Company the capital is given as $1,000,000. and the so-called profit and loss account for 1898 was $2,157,325.84, and for 1899, $2.240,404, the two last-mentioned amounts showing undivided profits to the amounts mentioned.

You refer me to an opinion of this Department, dated February 4, 1899, in which I advised you that the section of the war-revenue act above referred to had reference to "the capital of the bank and other funds belonging to it. which, by law or the action of the bank authorities, assumed the character of capital, and which the bank uses in carrying on its business," and you ask whether the facts stated in the present claims for a refund will warrant the refunding of the amount which these banks have paid on undivided

profits in one case and the profit and loss' account in the other case."

While the sentence from the opinion last quoted might seem to justify the conclusion that undivided profits, or the the profits represented by the so-called profit and loss account, may "assume the character of capital" and be taxable as such, or at least as surplus, yet the opinion as a whole seems to me to negative such suggestion. The question then submitted was as to whether the undivided profits of a national bank were to be excluded from the capital and surplus of the bank in estimating the amount of the special tax imposed by section 2 of the war-revenue act, and this Department then reached the conclusion that "the undivided profits of a bank are not surplus, and can not be estimated under the law in question as a part of the bank's surplus. The opinion defines the term surplus as "such amount as has been set apart by a vote of the directors, or other authorized action of the bank, to strengthen the capital." While in the sentence cited in your letter reference is made to the "other funds" belonging to the bank "which by law, or the action of the bank authorities, assumed the character of capital, and which the bank uses in carrying on its business," yet the expression "other funds" refers only to the surplus, and the surplus had already been defined as the amount formally set apart by action of the board of directors, and, as has been shown, the opinion expressly excluded undivided profits from such surplus.