[Code of Federal Regulations]
[Title 27, Volume 1]
[Revised as of April 1, 2005]
From the U.S. Government Printing Office via GPO Access
[CITE: 27CFR19.561]

[Page 395-396]
 
            TITLE 27--ALCOHOL, TOBACCO PRODUCTS AND FIREARMS
 
 CHAPTER I--ALCOHOL AND TOBACCO TAX AND TRADE BUREAU, DEPARTMENT OF THE 
                                TREASURY
 
PART 19_DISTILLED SPIRITS PLANTS--Table of Contents
 
                     Subpart Q_Losses and Shortages
 
Sec. 19.561  Losses in general.

                                 Losses


    (a) Allowable losses. Except as provided in paragraph (b) of this 
section, tax shall not be collected or, if paid, the tax shall be 
refunded when spirits, denatured spirits or wines are lost or destroyed 
while in bond.
    (b) Exceptions. Tax shall be collected in the case of:
    (1) Theft, unless the regional director (compliance) finds that the 
theft occurred without connivance, collusion, fraud or negligence on the 
part of the proprietor, owner, consignor, consignee, bailee, or carrier, 
or the employees or agents of any of them;
    (2) Voluntary destruction carried out other than as provided in 
subpart U of this part;
    (3) Unexplained shortage of bottled spirits.
    (c) Burden of proof. When it appears that a loss occurred due to 
theft, the burden of proof shall be on the proprietor or other person 
liable for the tax to establish to the satisfaction of the regional 
director (compliance) that the loss did not result from connivance, 
collusion, fraud, or negligence on the part of the proprietor, owner, 
consignor, consignee, bailee, or carrier, or the employees or agents of 
any of them.

[[Page 396]]

    (d) Claims for losses allowable under this section shall be filed in 
accordance with applicable provisions of subpart C of this part.
    (e) Limitations. The abatement, remission, credit, or refund of 
taxes on spirits, denatured spirits, or wines lost by theft shall be 
allowed only to the extent that the claimant is not indemnified against 
or recompensed for the taxes.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1323, as amended, 1381, as amended 
(26 U.S.C. 5008, 5370))