Rev. Rul. 70-70

The Internal Revenue Service has been asked whether distilled spirits may be filled at the premises of a distilled spirits plant into one or more compartments of a tank ship or tank barge which also contains methanol in one or more of its other compartments.

The term "bulk container" is defined in 26 CFR 201.11 to mean any approved container of five gallons or more, and the term "bulk conveyance" is defined in that same section to mean "a tank car, tank truck, tank ship, tank barge, or a compartment of any such conveyance, or other container approved by the Director for the conveyance of comparable quantities of spirits, including denatured spirits." (Emphasis supplied.)

In 26 CFR 201.501 (which appears in subpart P of the Distilled Spirits Plants regulations) it is stated that "This subpart does not regulate or prohibit the use on plant premises of any container for purposes other than containing alcoholic substances."

In view of the foregoing, it is held that any one compartment of a tank barge or tank ship which complies with the provisions of 26 CFR 201.510 can be considered to be a single bulk conveyance and, if it is so constructed as to preclude the intermingling of its contents with the contents of other compartments of the same tank barge or tank ship, it may be used for conveying distilled spirits or denatured spirits without regard to the purposes for which other compartments of the same ship or barge may be used. This finding is equally applicable to the separate compartments of tank trucks and railroad tank cars.

Proprietors are cautioned, however, that, before using any single compartment (or combination of compartments) of a tank ship or tank barge for shipping distilled spirits or denatured distilled spirits to a single consignee, they shall assure themselves that all interconnecting overflow lines or other interconnections between that compartment (or combination of compartments) and other compartments of the same tank ship or tank barge are closed and sealed so as to prevent any intermingling of that shipment with other shipments of similar or dissimilar products being shipped in other compartments of the same tank ship or tank barge.

Proprietors are further cautioned that nothing contained in this ruling is intended to exempt them from compliance with the prohibitions contained in 49 CFR Parts 174, 175, and 177. Those prohibitions have the effect, among other things not here pertinent, of precluding the shipment of poisons in the same car or vehicle with distilled spirits which are destined for (1) beverage use; (2) industrial use in the manufacture of nonbeverage drawback products; or (3) industrial use (after denaturation) in the manufacture of any foodstuffs, feeds, or other edible material intended for consumption by humans or animals.

Revenue Rulings 54-494, C.B. 1954-2, 476, and 64-82, C.B. 1964-1 (Part 1), 545, amplified.