In a case of actual controversy within its jurisdiction, except with respect to federal taxes other than actions brought under § 7428 of the Internal Revenue Code of 1986 . . . any court of the United States, upon the filing of an appropriate pleading, may declare the rights and other legal relations of any interested parties seeking such declarations, whether or not further relief is, or could be sought. (emphasis added).
Therefore, this Court is without jurisdiction to grant the declaratory relief sought by the plaintiff. See Black v. United States, 534 F.2d 524, 527 n. 3 (2d Cir. 1976). "The Declaratory Judgment Act prohibition against relief with respect to federal taxes . . . is designed to protect the government's need to assess and collect taxes as expeditiously as possible with a minimum of pre-enforcement judicial interference." Nelson v. Regan, 731 F.2d 105, 109 (2d Cir. 1984), cert. denied, sub. nom. Manning v. Nelson, 469 U.S. 853, 83 L. Ed. 2d 110, 105 S. Ct. 175 (1984) (quoting Bob Jones University v. Simon, 416 U.S. 725, 736, 40 L. Ed. 2d 496, 94 S. Ct. 2038 (1974)). Plaintiff's attempt to bootstrap the jurisdiction of this Court to grant such relief based on the establishment of an independent jurisdictional basis is unavailing. Plaintiff argues that since he has established a valid jurisdictional basis, i.e., his refund claim for 1982, he can maintain an action for declaratory relief. Plaintiff finds no support in case law for his proposition. Plaintiff does cite St. Louis Union Trust Company v. Stone, 570 F.2d 833 (8th Cir. 1978), in support of his proposition, however, the Eighth Circuit expressly reserved determination on "whether declaratory relief has been substantially circumscribed by the statutes limiting the extent and means by which tax issues may be raised." Stone, at 836. The court merely determined that the district court had jurisdiction under 28 U.S.C. 1331, to entertain an interpleader action pursuant to 28 U.S.C. 1335. Id. at 835.
The court did not feel it was proper, without district court's factual determinations, to reach a conclusion on whether the Trust Company's complaint stated a claim upon which relief could be granted, or whether declaratory relief was available. Id. at 836 ("The district court did not address the complex statutory scheme for tax collection because of its findings, here held to be erroneous, that plaintiff lacked subject matter jurisdiction [over the Trust Company's request to implead].") Therefore, since it is well settled that courts lack jurisdiction to grant declaratory relief, Greenhouse v. United States, 780 F. Supp. 136, 141 (S.D.N.Y. 1991)(hereinafter "Greenhouse II"), plaintiff's complaint is dismissed insofar as it requests a declaratory judgment for the tax years 1982 through 1991.
III. Injunctive Relief.
The plaintiff also seeks an injunction requesting that this Court enjoin the IRS from collecting any assessed taxes, interest, and/or penalties. However, just as the Declaratory Judgment Act bars courts from declaring the rights of parties with respect to federal taxes, the Anti-Injunction Act, 26 U.S.C. § 7422(a), prohibits any "suit for the purpose of restraining the assessment or collection of any tax." Laino v. United States, 633 F.2d 626, 629 (2d Cir. 1980); But see South Carolina v. Regan 465 U.S. 367, 375, 79 L. Ed. 2d 372, 104 S. Ct. 1107 (1984) (The Anti-Injunction Act does not apply when Congress has failed to provide an alternative remedy.)
Therefore, lawsuits like the one at bar, requesting the enjoinment of the collection of taxes, is precisely the type of suit which the Anti-Injunction Act specifically prohibits. See Bob Jones, 416 U.S. at 736; Greenhouse I, 738 F. Supp. at 712 .
Finally, several times throughout his proposed amended complaint, plaintiff requests that equity demands that this court grant declaratory and injunctive relief. Although equity jurisdiction may establish an exception to the Anti-Injunction Act, plaintiff must also prove that the government has no possible chance of succeeding on the merits of their claim. Enochs v. Williams Packing and Navigation Co., 370 U.S. 1, 8 L. Ed. 2d 292, 82 S. Ct. 1125 (1962). Plaintiff, however, has made no attempt to meet this strenuous burden. Greenhouse II, 780 F. Supp. at 140. In any event, this Court will not entertain a claim of equity jurisdiction in light of plaintiff's failure to avail himself of the remedies available in Tax Court. Flora II, 362 U.S. at 147.
Accordingly, it is
ORDERED, that plaintiff's motion to amend his complaint be granted; and it is further
ORDERED, that defendant's motion for partial dismissal is granted and the amended complaint is dismissed with respect to the 1983-1990 taxable years, and plaintiff's request for declaratory and injunctive relief; and it is further
ORDERED, that plaintiff may proceed with his claim that he is entitled to a refund solely with respect to the 1982 taxable year.
IT IS SO ORDERED.
David N. Hurd
U.S. Magistrate Judge
Dated: December 12, 1992
Utica, New York