FISHER, J.
The petitioner, Monica Clifft,
challenges the Indiana Department of State Revenue's (Department) finding that she owed a controlled substance excise tax (CSET) in the amount of $77,871. Monica has raised several issues for this Court's review.
The Court, however, finds that the only issue that remains is whether Monica possessed the marijuana in question such that she is liable for the CSET on it.
For the reasons stated below, the Court AFFIRMS the Department's assessment.
FACTS AND PROCEDURAL HISTORY
The Court has previously reviewed the facts of this case, which are set forth in Clifft v. Indiana Department of State Revenue, 641 N.E.2d 682, 684-85 (Ind. Tax Ct.1994) (Clifft I), aff'd in part and rev'd in part, 660 N.E.2d 310 (Ind.1995) (Clifft II). Therefore, this Court will briefly review the relevant factual and procedural history of this case in order to provide insight as to the current posture of this case.
In October 1992, Monica Clifft's residence was a house located on West 30th Street in Indianapolis, Indiana. (Trial Tr. at 13.) Monica, who had lived in the house since 1985 and was buying the house on contract, had lived in the house with her husband, Kevin Clifft. (Trial Tr. at 18, 15-17.) On October 8, 1992, Indianapolis and Speedway police executed a search warrant on Monica's house and discovered a total of 927 grams of marijuana
and marijuana growing equipment. Clifft I, 641 N.E.2d at 684. Kevin, but not Monica, was at the house when the police executed the warrant. (Trial Tr. at 9-10, 14.)
After the police shared this information with the Department, the Department issued an assessment for CSET in the amount of $77,871.
On January 14, 1993, after pleading guilty, Monica was convicted of possession of marijuana as a class A misdemeanor.
See Inp.Copm § 85-48-4-11. Monica protested the CSET assessment, and her protest was denied by the Department on May 12, 1998. (State's Ex. H.)
Monica petitioned this Court for review of the assessment and claimed among other things that the CSET violated her privilege against double jeopardy under the United States Constitution. Clifft I, 641 N.E.2d at 684. This Court ordered that CSET assessment against Monica be vacated because the CSET was a punishment subject to the constraints of the Double Jeopardy Clause and that the imposition of the CSET after the attachment by a conviction in the criminal case violated the Double Jeopardy Clause. Id. at 692-98.
Upon appeal to the Indiana Supreme Court, the Court reinstated the CSET assessment because it held the jeopardy in a CSET case attaches at the moment of the assessment. Cliff v. Indiana Dep't of State Revenue, 660 N.E.2d 310, 313, 318 (Ind.1995) (Cliff II). The Court reasoned that the CSET assessment in Monica's case did not violate the Double Jeopardy Clause because it was assessed prior to her criminal action, which was a second jeopardy. Id. at 313.
Monica then returned to this Court to challenge the CSET assessment. This Court conducted a trial on the issue of Monica's liability under the CSET statute. Additional facts will be supplied where necessary.
ANALYSIS AND OPINION
Standard of Review
This Court reviews final determinations of the Department de novo and is not bound by either the evidence presented or issues raised at the administrative level. I.C. § 6-8.1-5-1(h); see also Hall v. Indiana Dep't of State Revenue, 720 N.E.2d 1287, 1289 (Ind.Tax.Ct.1999). Although statutes that impose tax are to be strictly construed against the State, in Indiana, "[tlhe burden of proving that the proposed assessment is wrong rests with the person against whom the proposed assessment is made." IC. § 6-8.1-5-1(b); see also Horrall v. Indiana Dep't of State Revenue, 687 N.E.2d 1219, 1221 (Ind. Tax. Ct.1997), review denied; Longmire v. Indiana Dep't of State Revenue, 638 N.E.2d 894, 898 (Ind. Tax Ct.1994).
Discussion
Monica appears to claim that she is not liable for the CSET because she was not at the house and not living in the house at the time the police executed the search warrant and found the 972 grams of marijuana.
The Department maintains that Monica, who pled guilty to possession of the marijuana, is lable for the CSET assessment. (Resp't Trial Br. at 1.)
A person may be liable for the tax under the CSET statute, Indiana Code § 6-7-8-5, for controlled substances that are:
(1) delivered;
(2) possessed; or
(8) manufactured;
in Indiana in violation of IC 35-48-4 or 21 U.S.C. 841 through 21 U.S.C. 852.
1.C. § 6-7-8-5.
In Holl, this Court addressed the issue of whether the taxpayers had possession of marijuana such that they were liable for a CSET assessment. In that case, Keith Hall and his wife, Mary, were assessed with the CSET for marijuana found by police during a search of the Halls' house. Hall, 720 N.E2d at 1291. The police found the martjuana in a locked room in the basement. Id. at 1291. This Court found that the evidence of possession in regard to Keith Hall-specifically that he admitted to possessing the marijuana
-was sufficient to show that Keith had possession of the marijuana for liability under the CSET statute. Id. at 1291. On the other hand, this Court found that although there was some evidence that Mary Hall constructively possessed the marijuana (she co-owned the house where the marijuana was found, she washed laundry near the room where the marijuana was found, and the odor of raw marijuana emanated throughout the house), Mary did not have knowledge of the marijuana because it was kept behind a closed door that was locked and to which she did not have a key. Id. at 1291-92. Thus, this Court held that Mary did not have the intent or the capability to maintain dominion and control over the marijuana. Id. at 1292.
The evidence in this case shows that Monica Clifft possessed the marijuana such that she was liable under the CSET statute. Just like taxpayer Keith Hall in
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FISHER, J.
The petitioner, Monica Clifft,
challenges the Indiana Department of State Revenue's (Department) finding that she owed a controlled substance excise tax (CSET) in the amount of $77,871. Monica has raised several issues for this Court's review.
The Court, however, finds that the only issue that remains is whether Monica possessed the marijuana in question such that she is liable for the CSET on it.
For the reasons stated below, the Court AFFIRMS the Department's assessment.
FACTS AND PROCEDURAL HISTORY
The Court has previously reviewed the facts of this case, which are set forth in Clifft v. Indiana Department of State Revenue, 641 N.E.2d 682, 684-85 (Ind. Tax Ct.1994) (Clifft I), aff'd in part and rev'd in part, 660 N.E.2d 310 (Ind.1995) (Clifft II). Therefore, this Court will briefly review the relevant factual and procedural history of this case in order to provide insight as to the current posture of this case.
In October 1992, Monica Clifft's residence was a house located on West 30th Street in Indianapolis, Indiana. (Trial Tr. at 13.) Monica, who had lived in the house since 1985 and was buying the house on contract, had lived in the house with her husband, Kevin Clifft. (Trial Tr. at 18, 15-17.) On October 8, 1992, Indianapolis and Speedway police executed a search warrant on Monica's house and discovered a total of 927 grams of marijuana
and marijuana growing equipment. Clifft I, 641 N.E.2d at 684. Kevin, but not Monica, was at the house when the police executed the warrant. (Trial Tr. at 9-10, 14.)
After the police shared this information with the Department, the Department issued an assessment for CSET in the amount of $77,871.
On January 14, 1993, after pleading guilty, Monica was convicted of possession of marijuana as a class A misdemeanor.
See Inp.Copm § 85-48-4-11. Monica protested the CSET assessment, and her protest was denied by the Department on May 12, 1998. (State's Ex. H.)
Monica petitioned this Court for review of the assessment and claimed among other things that the CSET violated her privilege against double jeopardy under the United States Constitution. Clifft I, 641 N.E.2d at 684. This Court ordered that CSET assessment against Monica be vacated because the CSET was a punishment subject to the constraints of the Double Jeopardy Clause and that the imposition of the CSET after the attachment by a conviction in the criminal case violated the Double Jeopardy Clause. Id. at 692-98.
Upon appeal to the Indiana Supreme Court, the Court reinstated the CSET assessment because it held the jeopardy in a CSET case attaches at the moment of the assessment. Cliff v. Indiana Dep't of State Revenue, 660 N.E.2d 310, 313, 318 (Ind.1995) (Cliff II). The Court reasoned that the CSET assessment in Monica's case did not violate the Double Jeopardy Clause because it was assessed prior to her criminal action, which was a second jeopardy. Id. at 313.
Monica then returned to this Court to challenge the CSET assessment. This Court conducted a trial on the issue of Monica's liability under the CSET statute. Additional facts will be supplied where necessary.
ANALYSIS AND OPINION
Standard of Review
This Court reviews final determinations of the Department de novo and is not bound by either the evidence presented or issues raised at the administrative level. I.C. § 6-8.1-5-1(h); see also Hall v. Indiana Dep't of State Revenue, 720 N.E.2d 1287, 1289 (Ind.Tax.Ct.1999). Although statutes that impose tax are to be strictly construed against the State, in Indiana, "[tlhe burden of proving that the proposed assessment is wrong rests with the person against whom the proposed assessment is made." IC. § 6-8.1-5-1(b); see also Horrall v. Indiana Dep't of State Revenue, 687 N.E.2d 1219, 1221 (Ind. Tax. Ct.1997), review denied; Longmire v. Indiana Dep't of State Revenue, 638 N.E.2d 894, 898 (Ind. Tax Ct.1994).
Discussion
Monica appears to claim that she is not liable for the CSET because she was not at the house and not living in the house at the time the police executed the search warrant and found the 972 grams of marijuana.
The Department maintains that Monica, who pled guilty to possession of the marijuana, is lable for the CSET assessment. (Resp't Trial Br. at 1.)
A person may be liable for the tax under the CSET statute, Indiana Code § 6-7-8-5, for controlled substances that are:
(1) delivered;
(2) possessed; or
(8) manufactured;
in Indiana in violation of IC 35-48-4 or 21 U.S.C. 841 through 21 U.S.C. 852.
1.C. § 6-7-8-5.
In Holl, this Court addressed the issue of whether the taxpayers had possession of marijuana such that they were liable for a CSET assessment. In that case, Keith Hall and his wife, Mary, were assessed with the CSET for marijuana found by police during a search of the Halls' house. Hall, 720 N.E2d at 1291. The police found the martjuana in a locked room in the basement. Id. at 1291. This Court found that the evidence of possession in regard to Keith Hall-specifically that he admitted to possessing the marijuana
-was sufficient to show that Keith had possession of the marijuana for liability under the CSET statute. Id. at 1291. On the other hand, this Court found that although there was some evidence that Mary Hall constructively possessed the marijuana (she co-owned the house where the marijuana was found, she washed laundry near the room where the marijuana was found, and the odor of raw marijuana emanated throughout the house), Mary did not have knowledge of the marijuana because it was kept behind a closed door that was locked and to which she did not have a key. Id. at 1291-92. Thus, this Court held that Mary did not have the intent or the capability to maintain dominion and control over the marijuana. Id. at 1292.
The evidence in this case shows that Monica Clifft possessed the marijuana such that she was liable under the CSET statute. Just like taxpayer Keith Hall in
the Hall case, Monica Clifft admitted that she possessed the marijuana. Specifically, Monica admitted that she possessed the marijuana when she pled guilty to possession of marijuana in her criminal proceedings. (Trial Tr. at 15, 17; State's Exhibit I.) Moreover, Monica admitted that she possessed the marijuana during the trial in this case. Monica admitted that she knew the marijuana plants were growing in her house, that she used the marijuana in her house, and that some of the marijuana was found in her clothes. (Trial Tr. at 14-16.) Because Monica admitted that she possessed the marijuana, the Department properly assessed the CSET on her possession of that marijuana.
Even assuming arguendo that Monica had not pled guilty to possession of marijuana, the facts and evidence in this case shows that she constructively possessed the marijuana. Possession may be actual or constructive. Hurst v. Department of State Revenue, 721 N.E.2d 370, 374 (Ind.Tax.Ct.1999); Hall, 720 N.E.2d at 1290. In a CSET case, when a taxpayer does not have actual possession, there must be a determination of whether the taxpayer had constructive possession of the controlled substance. Hall, 720 N.B.2d at 1290 (citing Ladd v. State, 710 N.E.2d 188, 190 (Ind.Ct.App.1999)). Constructive possession is established when the taxpayer has shown both: (1) the requisite intent to maintain dominion and control over the controlled substance and (2) the capability to maintain dominion and control over the controlled substance. Id.
Proof of a possessory interest in the premises in which the illegal drugs are found is adequate to show the capability to maintain dominion and control over the drugs in question. Goliday v. State, 708 N.E.2d 4, 6 (Ind.1999). To prove the intent element, it must be shown that the petitioner had actual knowledge of the presence and the illegal character of the substance. Id.; Hurst, 721 N.E.2d at 375 (citing Godar v. State, 643 N.E.2d 12, 14 (Ind.Ct.App.1994), trans. denied). This knowledge may be inferred by either ex-elusive control over the premises where the contraband was found or, if the control is nonexclusive, evidence of additional circumstances tending to buttress such an inference. Goliday, 708 N.E2d at 6; Hall, 720 N.E.2d at 1290 (citing Lampkins v. State, 685 N.E.2d 698, 699 (Ind.1997)). These additional cireumstances that would imply a petitioner's knowledge of the nature of the substance and its presence include: (1) incriminating statements by the petitioner; (2) attempted flight or furtive gestures; (8) a drug manufacturing setting; (4) proximity of the petitioner to the drugs; (5) drugs in plain view; and (6) location of the drugs in close proximity to items owned by the petitioner. Hurst, 721 N.E.2d at 375; Hall, 720 N.E.2d at 1290.
First, this Court must determine whether Monica had capability to maintain dominion and control over the marijuana. Monica, who was buying the house where the marijuana was found, lived in the house since 1985, had the utility and phone bills in her name, kept her personal property in the house, and received her mail at that house. (Trial Tr. at 18, 15, 17.) Because Monica had a possessory interest in the house, it is adequate to show that she had the capability to maintain dominion and control over the marijuana. See Goli-day, 708 N.E.2d at 6.
Next, this Court must determine whether Monica had the intent to maintain dominion and control over the marijuana. Because Monica's husband, Kevin, also lived in Monica's house, the control over the premises where the marijuana was found was nonexclusive. Therefore, this Court must look to the additional factors that may support an inference that Monica
had knowledge of the nature and presence of the marijuana. Goliday, 708 N.E.2d at 6; Hall 720 N.E.2d at 1290. During the trial, Monica admitted that she knew that Kevin was growing marijuana in the house. (Trial Tr. at 14-15.) She also admitted that she used the marijuana while in the house and that some of the marijuana was found in her clothes. (Trial Tr. at 16, 21.) The police also discovered marijuana growing equipment in Monica's house. Clfft I, 641 N.E.2d at 684, These additional cireumstances-Monica's incriminating statements about her knowledge of and her use of marijuana in her house; a drug manufacture setting for marijuana in Monica's house; and the location of the marijuana in close proximity to items owned by Monica-buttress the inference that she knew that the marijuana was located in the house and support the inference that Monica had the intent to maintain dominion and control over the marijuana. See Hurst, 721 N.E.2d at 375; Hall, 720 N.E.2d at 1290.
The evidence presented shows that Monica had the intent and capability to maintain dominion and control over the marijuana. Thus, the evidence demonstrates that she had constructive possession of the marijuana. Because Monica possessed the marijuana in question, she is liable under the CSET statute for tax on the marijuana.
CONCLUSION
Because Monica Clifff possessed the marijuana found in her home, and indeed pled guilty to possession of that marijuana, this Court AFFIRMS the Department's finding that Monica is liable for the CSET assessment.