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Raytech Corp. and Subsidiaries v. Indiana Dep't of State Revenue12/1/2005
ORDER ON PARTIES' CROSS-MOTIONS FOR SUMMARY JUDGMENT
NOT FOR PUBLICATION
The Petitioners, Raytech Corporation and Subsidiaries (Raytech), appeal the final determination of the Indiana Department of State Revenue (Department) denying their claims for refund of gross income tax (GIT) and claims of entitlement to additional statutory interest on refunds of adjusted gross income tax (AGIT) and supplemental net income tax (SNIT) for the 1992-1997 tax years (years at issue). The matter is currently before the Court on the parties' cross-motions for summary judgment. The issues the Court must address are: (1) whether Raytech's claims for refund of GIT were timely filed with the Department; and (2) at what point does statutory interest on refunds of AGIT and SNIT begin to accrue. For the following reasons, the Court GRANTS summary judgment in favor of Raytech in part and the Department in part.
FACTS AND PROCEDURAL HISTORY
The material facts in this case are undisputed. Raytech is a Delaware Corporation with its principal place of business in Shelton, Connecticut. While Raytech is a global manufacturer of energy absorption and power transmission products and custom engineered components, it acts primarily as a management company for its subsidiaries.
In the late 1980s, Raytech divested its interest in Raymark Corporation (Raymark), an entity engaged in an asbestos related field. Raytech, however, was named as a defendant in several product liability lawsuits against Raymark and its successors in interest. As a result, Raytech filed for bankruptcy protection in 1989. Nevertheless, Raytech continued to file returns reporting its GIT, AGIT and SNIT.
In 2001, when Raytech emerged from bankruptcy , it was required to issue a significant payout as a settlement of the product liability claims, resulting in a multi-million dollar net operating loss (NOL). Pursuant to Section 172 of the Internal Revenue Code, Raytech was able to carry back the NOL to each of the 10 taxable years preceding the year of the loss (2001). See 26 U.S.C.A. § 172 (2001); IND. Code ANN. § 6-3-2-2.6 (West 2001) (amended 2002). Accordingly, on April 25, 2002, Raytech filed amended corporate income tax returns reporting the NOL carryback for the 1992-1999 tax years. Raytech simultaneously filed claims for refund of GIT based on alleged reporting errors, unrelated to the carryback, on its original tax returns during the years at issue.
Between March and May of 2003 (and after conducting audits of the years at issue), the Department denied Raytech's claims for refund of GIT, stating that the claims were untimely filed and thus barred by Indiana Code § 6-8.1-9-1(a). Nevertheless, the Department paid refunds of AGIT and SNIT (along with statutory interest) to Raytech resulting from its NOL carryback.
On June 18, 2003, Raytech filed an original tax appeal. On March 18, 2005, Raytech filed a motion for summary judgment. On June 13, 2005, the Department also filed a motion for summary judgment. The Court heard the parties' oral arguments on both motions on August 26, 2005. Additional facts will be supplied as necessary.
ANALYSIS AND OPINION
Standard of Review
This Court hears appeals from denials of claims for refunds by the Department de novo. IND. CODE ANN. § 6-8.1-9-1(d) (West Supp. 2005-2006). Therefore, the Court is bound by neither the evidence presented nor the issues raised at the administrative level. Snyder v. Indiana Dep't of State Revenue, 723 N.E.2d 487, 488 (Ind. Tax Ct. 2000), review denied.
In addition, a motion for summary judgment will be granted only when there is no genuine issue of
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