                             March   31,   1953


Hon. William H. Scott           Opi.nionNo. S-22
Crimina~lDistrict Attorney
Civil Courts Bullding          Re:     Applicabil~ityof the motor
Houston 2, Texas                       vehl~cletransfer tax to the
                                       submItted transact!on between
                                       Johnston Oil,Field Service
                                       Corporation and Johnston
                                       Testers, Inc.
Attention:   Hon. James R. Gough
             Assistent~District Attorney
Deer Sir:
         You request the~opinion of this office es to whether-e
certain transfer of motor vehicles between the,Johnston Oil
Field Service Corporation end Johnston Testers, Inc. Is subject
to the tex levied by Article 7047k, Civil Statutes,
         The facts seem to be es follows: All of the capital
stock of Johnston Oil Field S,erviceCorporatLon, e Texas corpor-
ation, was acquired by the Johnston Testers, Inc., e Delewere
corporetion, with a permit to do business in the State of Texas.
This being accomplished the Johnston Oil Field Service Corpore-
tion wes liquidated by transfer of ~11 the assets of the Johnston
011 Field Service Corporation, including the motor'vehlcles
owned end registered by the Johnston Oil Field Service'Corpore-
tlon. There wes in fact a merger of the Johnston~Oil Field Ser-
vLce Corporation with the Johnston Testers, Inc., without con-
sideretion.
         We ere of the opinion thet under the conceded facts this
transection does nc)t constitute a taxable sale of the motor
vehicles under the provisions of Article  7047k, V .C.S'. There is
no case in this ?,tateor I,nany other jurisdiction which our re- '.
search has revealed exactly in point. In the cese of Jones,
Collector of Internal Revenue v. Noble Drill!ng Comoang Incor-
porated, 135 Fed. 2d 721, involvi~ngfacts somewhat simiier, the
court said:
         "The merger agreement was without ConsideratSon.
    There.wes e statutory merger, not a mere sale of assets."
         It appears that if there be a merger of two corporations,
either by contract or by operation of law, wlthout consideration
Hon. WIllfernH. Scott, page 2          s-22


moving to the liquidated corporation, it does not have the effect
of converting the transfer of the essets of the liquidated cor-
poration to the surviving corporation Into a sale of the assets.
         We do not think the facts here are enalegous to the
facts upon which our previous Opinion No. v-36 (1947) is based.
A transfer of the motor vehicles by the pertnership to the cor-
poration in Opinion No. v-36 wes concededly based upon the value
of the motor VehiCleB transferred, hence upon a 'substantleland
ascertainable consideration. Such 1,snot the cese here.

                           SUMMARY
        There'ls not e sele of motor vehicles within
   the.provisions of the motor vehi,cle~
                                       sales tax im-
   posed by Article 7047k-upon the transfer of motor
   vehicles from a Liquidated corporation to the sur-
   viving corporetion by e merger of the corporations
   when the merger wes without consideration.
                                Yours very truly,
                            JOHN BEN SHEPPRRb
                              Attorney General

                                By: s/L. P. Lollar
                                      L. .P. Lollar
                                      Assistant
APPROVED:
W.V. Geppert'
Taxation Division
Willis Gresham
Reviewer
Robert S. Trotti
FLrst Assistant
John Ben Shepperd
Attorney General
LPL:MG9c
