This is an information filed by the United States in the district court for the district of Maryland, against a quantity of domestic cigars, to obtain their condemnation as forfeited to the United States. The information alleges, as a cause of forfeiture, that the cigars were found in the possession of two persons by the name of Ludloff, doing business as Ludloff Bros., who had manufactured them, and who had unlawfully removed certain cigars, by them manufactured at their manufactory in the city of Baltimore, without the proper stamps donating the tax thereon, contrary to section 3400 of the Revised Statutes. Ludloff Bros. put in a claim and plea, denying forfeiture, and the issue was tried before a jury, who found a verdict for the United States. Thereupon a judgment of condemnation of the cigars seized was rendered, which was affirmed by the circuit court, and is now brought here for review by a writ of error taken by the claimants.
The material facts of the case, as they appear by the bill of exceptions, are these:
Prior to the seizure of the cigars, and before May 1, 1878, the claimants carried on the manufacture of cigars in the rear part of a small room on the first floor of the building known as No. 60 West Fayette street, in the city of Baltimore, and at the same time and place were also engaged in doing the business of dealers in tobacco; that is to say, selling imported and domestic cigars, partly manufactured by themselves, and partly purchased from others, and also selling pipes, smoking material, chewing tobaccoo, snuff, etc., they having first paid to the United States the special tax as dealers in tobacco, and also the special tax as manufacturers of cigars. In the course of said business they sold to their customers cigars so manufactured by them in the rear part of said room, in quantities less than 25, but out of stamped boxes, which boxes were duly branded, marked, and stamped, and then deposited in a show-case before said sale was made. No cigars were sold by them upon which the tax had not been paid.
On the twenty-first of March, 1870, the commissioner of internal revenue had issued a circular (No. 181) in the following terms:
'The portions of the law regulating the manufacture and sale of cigars, without declaring in specific language that the two kinds of business, to-wit, manufacturing cigars and selling manufactured tobacco and cigars at retail, shall not be carried on in the same place at the same time, impose such restrictions, make such requirements, and declare such forfeitures and penalties, as renders it impracticable for these two kinds of business to be carried on together, as above stated. See sections 3387, 3392, 3397, of the Revised Statutes of the United States; also, Special 85, revised, and Form 36 1/2. Under as lenient a construction of these several sections of the law as their language and the purpose for which they were enacted, to-wit, the protection of the revenue, will admit, it is held that a cigar factory, or the place where cigars can be made for sale, must be at least an entire room, separated by walls and partitions from all other parts of the building, and that the factory or place of manufacture designated and described in form 36 1/2 cannot be used, nor can any portion thereof, even though marked off or separated from the remainder by a railing, counter, bench, screen, or curtain, be used as a store where the manufacturer can sell his cigars otherwise than in legal boxes, properly branded, labeled, and stamped. When a cigar manufacturer has a store in a room adjoining his factory, a door and windows may be allowed between the factory and store; and, if necessary for light or ventilation, the upper portion of the partition between the factory and store may be of glass or wire-cloth. Collectors and all other revenue officers are enjoined to see that these instructions are strictly enforced on and after May 1, 1878.'
This order was disregarded by the claimants, because in June, 1878, the said district court had decided that the business of manufacturing and selling cigars at retail, by the same person, at the place of manufacture, as well as selling at said place manufactured tobacco, pipes, and other smoking material, was not prohibited by law. Thereupon, in August, 1878, the cigars in suit were seized as forfeited, and were found, when seized, in boxes not stamped, in the rear part of the room before described. Such rear part had been designated as the factory or place of manufacture where the claimants proposed to carry on their business in manner and form as prescribed by the commissioner of internal revenue, as follows:
'(36 1/2.)
'UNITED STATES INTERNAL REVENUE.
'Cigar Manufacturers' Statement.