1350
PUBLIC LAW 85-859-SEPT. 2, 1958
[72 S T A T.
or his delej^ate, conditioned that he shall faithfully comply with all the provisions of law and regulations relating to the duties and business of a distiller, bonded warehouseman, or rectifier, as the case may be (including the payment of taxes imposed by this chapter), and shall pay all penalties incurred or fines imposed on him for violation of any of the said provisions. " (b) DISTILLER'S BOND.—Every person intending to commence or
continue the business of a distiller shall give bond in a penal sum not less than the amount of tax on spirits that will be produced in his distillery during a period of 15 days, except that such bond shall be in a sum of not less than $5,000 nor more than $100,000. " (1) CONDITIONS OF APPROVAL.—In addition to the require-
ments of subsection (a), the distiller's bond shall be conditioned that he shall not suffer the property, or any part thereof, subject to lien under section 5004(b)(1) to be encumbered by mortgage, judgment, or other lien during the time in which he shall carry on such business (except that this condition shall not apply during the term of any bond given under subparagraph (C)), and no bond of a distiller shall be approved unless the Secretary or his delegate is satisfied that the situation of the land and buildings which will constitute his bonded premises (as described ill his application for registration) is not such as would enable the distiller to defraud the United States, and unless— " (A) the distiller is the owner in fee, unencumbered by any mortgage, judgment, or other lien, of the lot or tract of land subject to lien under section 5004(b)(1); or " (B) the distiller files with the officer designated for the purpose by the Secretary or his delegate, in connection with his application for registration, the written consent of the owner of the fee, and of any mortgagee, judgment creditor, or other person having a lien thereon, duly acknowledged, that such premises may be used for the purpose of distilling spirits, subject to the provisions of law, and expressly stipulating that the lien of the United States, for taxes on distilled spirits produced thereon and penalties relating thereto, shall have priority of such mortgage, judgment, or other encumbrance, and that in the case of the forfeiture of such premises, or any part thereof, the title to the same shall vest in the United States, discharged from such mortgage, judgment, or other encumbrance; or " (C) the distiller files a bond, approved by the Secretary or his delegate, in the penal sum equal to the appraised value of the property subject to lien under section 5004(b)(1), except that such bond shall not exceed the sum of $300,000. Such value shall be determined, and such bond shall be executed in such form and with such sureties and filed with the officer designated by the Secretary or his delegate, under such regulations as the Secretary or his delegate shall prescribe. "(2) CANCELLAnoN OF INDEMNITY BOND.—When the liability for which an indemnity bond given under paragraph (1)(C) ceases to exist, such bond may be cancelled upon application to the Secretary or his delegate. "(3) JUDICIAL SALE.—In the case of any distillery sold at judicial or other sale in favor of the United States, a bond in lieu of consent under paragraph (1)(B) may be taken at the discretion of the Secretary or his delegate, and the person giving such bond may be allowed to operate such distillery during the existence of the right of redemption from such sale, on complying with all the other provisions of law.
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