Paragraph 18 of section 1 of the Interstate Commerce Act, as amended by Transportation Act 1920, February 28, c. 91, § 402, 41 Stat. 456, 477, 478 (49 USCA § 1(18), prohibits any carrier by railroad subject to that act from undertaking any extension of its lines or construction of new lines, without first obtaining from the Interstate Commerce Commission a certificate of public necessity and convenience. Paragraphs 19 and 20 provide for applications for certificates and prescribe the procedure and mode of disposal. Paragraph 22 exempts from the scope of those provisions the construction of industrial and certain other tracks 'located wholly within one State, or of street, suburban, or interurban electric railways, which are not operated as a part or parts of a general steam railroad system of transportation.'
The Piedmont & Northern Railway, a carrier by railroad subject to the Interstate Commerce Act, operates in interstate commerce about 128 miles of line in North and South Carolina, using exclusively electric locomotives. It determined to extend its lines 53 miles on one route and 75 miles on another, in order to connect with several steam railroads; and, believing that the above provisions of that act were inapplicable, it intended to make the proposed extensions without securing from the Commission a certificate of public necessity and convenience. The Commission, learning informally of the project, advised the railway by letter that before it 'constructs any extensions to its line or issues any securities it will be expected to file appropriate applications for authority therefor under sections 1 and 20a (49 USCA § 1, 20a). The filing of such applications will, of course, be without prejudice to your right to assert that the Commission has no jurisdiction over your property in those respects and to adduce whatever evidence you may desire to support such contention.' The letter called attention to the following passage in Texas & Pacific Ry. Co. v. Gulf, Colorado & Santa Fe Ry Co., 270 U.S. 266, 272, 46 S.C.t. 263, 264, 70 L. Ed. 578:
'Whenever such an application is made, the Commission may pass incidentally upon the question whether what is called an extension is in act such; for if it proves to be only an industrial track, the Commission must decline, on that ground, to issue a certificate. A carrier desiring to construct new tracks does not, by making application to the Commission, necessarily admit that they constitute an extension. It may secure a determination of the question, without waiving any right, by asserting in the application that in its opinion a certificate is not required, because the construction involves only an industrial track.'