ises or in an office adjacent thereto, the copies of all approved qualifying documents which have been returned to him by the regional regulatory administrator. Such copies shall be made available, without delay, for the examination of any ATF officer.

§ 231.62 Discontinuance of business.

When the proprietor desires to discontinue the operation of a taxpaid wine bottling house, he shall file a notice, in triplicate, with the regional regulatory administrator giving the date of discontinuance and stating whether all wine on hand has been disposed of and if it has not been disposed of, the disposition which will be made.

§ 231.63 Premises in use prior to effective date.

Where premises are in use for the bottling of taxpaid wine immediately prior to the effective date of this part, the qualifying documents required by this subpart must be filed on or before that date for continued operations. The regional regulatory administrator may approve the continued use of any such premises not meeting the requirements of this part as to construction and equipment provided he finds that such continued use will not result in jeopardy to the revenue.

Subpart F-Operations

§ 231.80 Treatment and handling of wine. The proprietor of a taxpaid wine bottling house may use sulfur dioxide compounds, refrigeration or pasteurization in the treatment of wine. Wine may be preserved, filtered or clarified by the use of methods or materials which will not change the basic character of the wine: Provided, That if the proprietor desires to treat wine in any manner other than by simple filtration or the use of sulfur dioxide compounds, refrigeration or pasteurization, he shall first file with the regional regulatory administrator an application, in triplicate, giving the details of the proposed treatment. The regional regulatory administrator will approve the application, if the proposed treatment is permissible on tax

paid wine bottling house premises, and the proprietor must not use the treatment prior to receipt of such approval: Provided, That if application has been filed covering the use of any material or method which a proprietor was using prior to the effective date of this part, he may continue the use of such material or method pending receipt of approval or disapproval of the application. Wine of the same kind (class, type, and national origin) and taxable grade may be mixed to facilitate handling.

(68A Stat. 665; 26 U.S.C. 5363)

§ 231.81 Prohibited practices.

While more than one lot of wine of the same kind (class and type), taxable grade, and country of origin, may be deposited in the same storage container or bottling tank to facilitate handling, the blending of taxpaid wines at a taxpaid wine bottling house is prohibited. Water may not be added to wine nor may wine be subjected to any treatment which will alter its basic character. Unauthorized treatment of wine may result in liability to rectification tax or additional wine tax. The proprietor of a taxpaid wine bottling house may incur liability to penalties by reason of unauthorized treatment of wine.

(68A Stat. 695; 26 U.S.C. 5661)

§ 231.82 Bottling and labeling operations.

Bottles must be filled as nearly as possible to conform to the quantity shown on the label or blown in the bottle, but in no event may the amount of wine contained in any bottle, due to lack of uniformity of the bottles, vary more than two percent from the amount stated to be contained therein; and further in the case of variations in fill within the two percent limitation there shall be substantially as many bottles overfilled as there are bottles underfilled for each lot of wine bottled. Bottles shall be labeled to show:

(a) The name of the proprietor, or an approved trade name, and address of the premises or the name, registry number and state where the premises are located, except that if imported

wine is bottled or packed in the United States for the person responsible for the importation there may be stated, in lieu of the above requirements, the name and principal place of business in the United States of the person responsible for the importation, immediately preceded by the phrase "imported by and bottled (packed) in the United States for” (or a similar appropriate phrase);

(b) Kind of wine (class and type), in the manner specified by 27 CFR Part 4;

(c) The alcohol content by volume in the manner specified by 27 CFR Part 4; and

(d) The net contents of the bottle, unless displayed on the bottle as provided in 27 CFR 4.37(d).

The labels used by bottlers of wine must be covered by certificates of label approval or certificates of exemption from label approval issued under the Federal Alcohol Administration Act. Bottles must be placed in cases, marked as required by § 231.85, prior to removal from the premises.

[20 FR 2928, Apr. 30, 1955, as amended by T.D. 6290, 28 FR 2180, Apr. 3, 1958; T.D. 6420, 24 FR 8643, Oct. 24, 1959. Redesignated at 40 FR 16835, Apr. 15, 1975]

§ 231.83 Relabeling of bottled wine.

Where it is desired to relabel wine bottled at other premises, application for permission to relabel the wine must be made to the regional regulatory administrator in accordance with the provisions of 27 CFR Part 4.

§ 231.84 Packaging.

The proprietor of a taxpaid wine bottling house may package or repackage wine in barrels, casks, kegs, or similar containers, or in demijohns or bottles of a capacity of two gallons or more. The marks on such containers filled for sale at retail constitute a lael, and are subject to the same requirement for approval as labels for bottles.

(68A Stat. 663; 26 U.S.C. 5352)

§ 231.85 Marks.

Each package or case filled at a taxpaid wine bottling house shall be

marked in a plain and durable manner with (a) a serial number, or alternate marks in lieu of a serial number as provided in § 231.86, (b) the name of the proprietor and location (by city or town and State or by registry number and State) of the taxpaid wine bottling house, (c) the kind (class and type) and the alcohol content of the wine, (d) the contents of the package or case in wine gallons, and (e) except for cases, the date of removal or shipment. When wine is packaged or bottled under an authorized trade name such trade name may be marked on the shipping container as the name of the proprietor. These marks may be cut, printed, or otherwise durably marked on the package or case or placed upon a label or tag securely affixed to such container. The marks shall be placed on the head of the package or a side of the case.

(72 Stat. 1381; 26 U.S.C. 5368)

[T.D. 6562, 26 FR 4050, May 11, 1961. Redesignated at 40 FR 16835, Apr. 15, 1975]

§ 231.86 Serial numbers.

All packages or cases filled shall be marked with a serial number at the time the packages or cases are filled, except as provided herein. Serial numbers shall commence with "1" and continue in order until the number 1,000,000 is reached, when the series may start again with "1": Provided, That a new series may be commenced when 100,000 has been reached if no number will be used more than once during a 12-month period. If desired, separate series of numbers preceded by identifying letters may be used for bulk containers and for cases, or for cases filled on different bottling lines, or for removals from different loading docks. On filing a notice with the regional regulatory administrator the proprietor may, unless notified by the regional regulatory administrator to the contrary, mark the cases with the filling date in lieu of serially numbering the cases. The notice shall be filed in duplicate not less than 10 days prior to the date on which the proprietor intends to commence marking cases with the filling date. A proprietor who has given notice of his intention to mark the filling dates on the cases shall use

such procedure exclusively until the regional regulatory administrator requires or authorizes the cases to be marked as otherwise provided in this section.

(72 Stat. 1381; 26 U.S.C. 5368)

[T.D. 6562, 26 FR 4050, May 11, 1961. Redesignated at 40 FR 16835, Apr. 15, 1975)

Subpart G-Wines for Export With Benefit of Drawback

§ 231.100 General.

Wine manufactured, produced, bottled in bottles packed in containers, or packaged in casks, or other bulk containers in the United States and on which the internal revenue tax has been determined or paid may be exported from a taxpaid wine bottling house. On exportation of the wine there may be allowed a drawback equal in amount to the tax found to have been paid.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1336, as amended, 26 U.S.C. 5062))

[T.D. ATF-51, 43 FR 24243, June 2, 1978]

§ 231.101 Procedure.

The exportation of wine, including the lading thereof for use as supplies on vessels or aircraft and the allowance of drawback thereon, shall be in accordance with the provisions of Part 252 of this chapter.

[T.D. 6387, 24 FR 4820, June 12, 1959. Redesignated at 40 FR 16835, Apr. 15, 1975]

Subpart H-Records and Inventories

§ 231.110 Record of receipts and removals. Proprietors of taxpaid wine bottling houses shall keep daily records, in bound or other permanent form, available for inspection by ATF officers, of all wine received at and removed from their premises, and make daily entries therein as the transactions occur. These records shall show as to receipts of wine:

(a) The name of the person from whom received;

(b) The registry number (if any) of the premises from which received;

(c) The address of the premises from which received;

(d) The kind (class, type, and in the case of foreign wine, country of origin) of the wine;

(e) Alcohol content or taxable grade of the wine; and

(f) The quantity in gallons of wine received.

The records shall show as to removals:

(g) The name and address of the person to whom removed: Provided, That on sales of not more than one case direct to consumers the name and address of the consignee need not be shown;

(h) The kind (class, type, and in the case of foreign wine, country of origin) of the wine;

(i) Alcohol content or taxable grade; and

(j) The quantity in gallons of wine shipped.

Where the proprietor keeps copies of invoices or other commercial records covering receipt and shipment of wine, with detailed information thereon, or ascertainable therefrom, as described above, and such commercial records are kept in such manner that the required information may be readily ascertained therefrom by ATF officers, the separate record may show, by tax class, the total quantity received and removed each day in lieu of the details of each receipt and removal. Entries shall be made on the separate record on the day on which the transactions occur, unless the details are shown on commercial records, in which case the totals may be entered on the separate record on the following business day. Within five days after the close of each month the proprietor shall make a monthly summary showing the quantity on hand at the beginning of the month, the quantities received, removed, and lost during the month, and the quantity remaining on hand at the close of the month, for each tax class of wine handled.

(72 Stat. 1381; 26 U.S.C. 5367)

[20 FR 2928, Apr. 30, 1955, as amended by T.D. 6562, 26 FR 4050, May 11, 1961. Redesignated at 40 FR 16835, Apr. 15, 1975]

§ 231.111 Record of cases filled.

Each proprietor of a taxpaid wine bottling house shall keep Form 2060,

record of wine cases filled, covering the bottling of the wine and the filling and serial numbering of cases. The proprietor must furnish Form 2060 at his own expense in accordance with the form prescribed by the Director, Alcohol and Tobacco Tax Division. Samples of the prescribed Form 2060 may be obtained from the regional regulatory administrator for the use of commercial printers. Proprietors desiring to maintain records in a different form which will show the information called for by Form 2060 may obtain approval for such substitute record upon filing samples of the record with the regional regulatory administrator, provided the regional regulatory administrator finds that the substitute record will furnish the required information in a form susceptible of ready examination and audit by ATF officers.

(68A Stat. 666; 26 U.S.C. 5367)

§ 231.112 Record of packages filled.

Each proprietor of a taxpaid wine bottling house who fills packages of wine for removal from the premises must keep a record of the wine packaged. The record shall show the date of packaging, the number of packages filled, serial number and contents of each, and the kind and alcohol content of the wine. No form is prescribed for the record of packages filled but it must be kept complete and in chronological order available for inspection by ATF officers.

(68A Stat. 666; 26 U.S.C. 5367)

§ 231.113 Inventories.

The proprietor of every taxpaid wine bottling house shall take an inventory of all wine on hand at his premises on June 30 and December 31 of each year. The record of the inventory shall show the serial number, if any, of each container (except cases), the kind of wine (class and type), the gallons contained therein by taxable grade, and a summary by kinds and by taxable grades. The proprietor shall retain the record of inventory and the working papers available for inspection by ATF officers at any reasonable hour.

(68A Stat. 666; 26 U.S.C. 5369)

§ 231.114 Retention of records.

All records required by this part must be retained by the proprietor for a period of three years, and shall be filed in such manner that they may be readily inspected by ATF officers.

Subpart I-Variations From Requirements

§ 231.120 Alternate methods or procedures; and emergency variations from requirements.

(a) Alternate methods or procedures. The proprietor, on specific approval by the Director as provided in this paragraph, may use an alternate method or procedure in lieu of a method or procedure specifically prescribed in this part. The Director may approve an alternate method or procedure, subject to stated conditions, when he finds that

(1) Good cause has been shown for the use of the alternate method or procedure;

(2) The alternate method or procedure is within the purpose of, and consistent with the effect intended by, the specifically prescribed method or procedure, and affords equivalent security to the revenue; and

(3) The alternate method or procedure will not be contrary to any provision of law, and will not result in an increase in cost to the Government or hinder the effective administration of this part. No alternate method or procedure relating to the payment of tax shall be authorized under this paragraph. Where the proprietor desires to employ an alternate method or procedure, he shall submit a written application so to do, in triplicate, to the regional regulatory administrator, for transmittal to the Director. The application shall specifically describe the proposed alternate method or procedure, and shall set forth the reasons therefor. Alternate methods or procedures shall not be employed until the application has been approved by the Director. The proprietor shall, during the period of authorization of an alternate method or procedure, comply with the terms of the approved application. Authorization for any alter

nate method or procedure may be withdrawn whenever in the judgment of the Director the revenue is jeopardized or the effective administration of this part is hindered by the continuation of operation other than as specified in this paragraph, alternate methods or procedures shall include alternate construction or equipment.

(b) Emergency variations from requirements. The Director may approve construction, equipment, and methods of operation other than as specified in this part, where he finds that an emergency exists and the proposed variations from the specified requirements are necessary, and the proposed variations

(1) Will afford the security and protection to the revenue intended by the prescribed specifications;

(2) Will not hinder the effective administration of this part; and

(3) Will not be contrary to any provisions of law.

Variations from requirements granted under this paragraph are conditioned on compliance with the procedures, conditions, and limitations with respect thereto set forth in the approval of the application. Failure to comply in good faith with such procedures, conditions, and limitations shall automatically terminate the authority for such variations and the proprietor thereupon shall fully comply with the prescribed requirements of regulations from which the variations were authorized. Authority for any variation may be withdrawn whenever in the judgment of the Director the revenue is jeopardized or the effective administration of this part is hindered by the continuation of such variation. Where the proprietor desires to employ such variation, he shall submit a written application so to do, in triplicate, to the regional regulatory administrator for transmittal to the Director. The application shall describe the proposed variations and set forth the reasons therefor. Variations shall not be employed until the application has been approved.

(72 Stat. 1395; 26 U.S.C. 5552)

[T.D. 6562, 26 FR 4050, May 11, 1961. Redesignated at 40 FR 16835, Apr. 15, 1975]

Subpart J-Examination of Premises

§ 231.130 Officer's right of entry and examination.

ATF officers have authority under the law to inspect at any reasonable hour the records, stocks, and premises of taxpaid wine bottling houses to determine that provisions of the internal revenue laws and regulations are being complied with. Officers desiring to make inspections will identify themselves by exhibiting credentials. Any denial of or interference with such inspection by the proprietor, his agents, or employees, is a violation of law and will be reported as such for appropriate action.

(68A Stat. 872, 908; 26 U.S.C. 7342, 7606)