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(b) Expired. (June 28, 1940, ch. 440, title I, § 2, 54 Stat. 676; Sept. 9, 1940, ch. 717, title II, $ 201, 54 Stat. 875; May 31, 1941, ch. 157, 55 Stat. 236; Mar. 27, 1942, ch. 199, title III, § 301, 56 Stat. 177; Dec. 20, 1944, ch. 614, 58 Stat. 827; Proc. No. 2695, July 4, 1946, 11 F.R. 7817,60 Stat. 1352; Aug. 7, 1946, ch. 770, $ 1 (26, 31), 60 Stat. 868; Oct. 15, 1970, Pub. L. 91-452, title II, § 249, 84 Stat. 931.)

REFERENCES IN TEXT Reference to Act of August 24, 1935, 49 Stat. 793; 40 U.S.C. $ 270(a)-(d), probably was intended to be a reference to sections 270a to 270d of title 40.

Sections 411 to 419 of Title 22, referred to in text, have been omitted as executed.

products, upon a determination by the President that such controls are (a) essential to the acquisition or distribution of products in world short supply or (b) essential to the orderly liquidation of temporary surpluses of stocks owned or controlled by the Government.

Similar provisions continuing the controls until July 1, 1950, were contained in Act July 1, 1949, c. 292, 63 Stat. 405.

OFFICE OF DEFENSE TRANSPORTATION Ex. Ord. No. 9729, May 23, 1946, 11 F. R. 5641, related to the functions and duties of the Ofice of Defense Transportation, which was terminated by Ex. Ord. No. 10065, July 6, 1949, eff. July 1, 1949.

CROSS REFERENCES Extension of certain provisions of this section, see section 645 of this Appendix.

Immunity of witnesses, see section 6001 et seq. of Title 18, Crimes and Criminal Procedure.

SECTION REFERRED TO IN OTHER SECTIONS This section referred to in title 42 section 1523.

CODIFICATION The Department of War was designated the Department of the Army and the title of the Secretary of War was changed to Secretary of the Army by section 205(a) of act July 26, 1947, ch. 343, title II, 61 Stat. 501. Section 205(a) of act July 26, 1947, was repealed by section 53 of act Aug. 10, 1956, ch. 1041, 70A Stat. 641. Section 1 of act Aug. 10, 1956, enacted “Title 10, Armed Forces" which in sections 301143013 continued the military Department of the Army under the administrative supervision of a Secretary of the Army.

Words "and the courts of the Philippine Islands", in subsec. (a) (6), were deleted in view of the independence of the Philippines upon authority of Proc. No. 2695, eet out as a note under section 1394 of Title 22, Foreign Relations and Intercourse.

AMENDMENTS 1970–Subsec. (a) (4). Pub. L. 91-452 struck out the provisions which related to the immunity from prosecution of any individual compelled to testify or produce evidence, documentary or otherwise, after claiming his privilege against self-incrimination.

1946–Subsec. (a) (1). Act Aug. 7, 1946, repealed the proviso requiring the Secretary of the Navy to report every three months to Congress the contracts entered into under authority of par. (1). 1944–Subsec. (a). Act Dec. 20, 1944, added par. (9).

EFFECTIVE DATE OF 1970 AMENDMENT Amendment by Pub. L. 91-452 effective on the sixtieth day following Oct. 15, 1970, see section 260 of Pub. L. 91-452, set out as a note under section 6001 of Title 18, Crimes and Criminal Procedure.

SAVINGS PROVISION Amendment by Pub. L. 91-452 not to affect any immunity to which any individual is entitled under this section by reason of any testimony given before the sixtieth day following Oct. 15, 1970, see section 260 of Pub. L. 91-452, set out as a note under section 6001 of Title 18, Crimes and Criminal Procedure.

EXPIRATION OF SECTION Subsec. (a) of this section was amended by Title III of the Second War Powers Act, act Mar. 27, 1942, and did not expire on June 30, 1942, with the other provisions of sections 1151-1162.

Subsec. (b) of this section expired June 30, 1942, under former section 1162 of this Appendix. It required contracts for naval vessels under section 496 of former Title 34 to contain limitations on excess profits. Renegotiation of contracts is now covered by section 1211 et seq. of this Appendix. CONTINUATION OF IMPORT CONTROLS OVER FatS AND OILS

AND RICE AND RICE PRODUCTS UNTIL AUG. 1, 1951 Act June 30, 1950, c. 426, 64 Stat. 308, as amended June 30, 1951, c. 198. $ 3, 65 Stat. 111, continued Title III of the Second War Powers Act, 1942, as amended [this section) until Aug. 1, 1951, for the purpose of authorizing and exercising, administering, and enforcing of import controls with respect to fats and oils (including oll-bearing materials, fatty acids, butter, soap and soap powder, but excluding petroleum and petroleum products and coconuts and coconut products) and rice and rice

SS 1153 to 1162. Omitted.

CODIFICATION Sections 1153, 1154, and 1156_1162 terminated June 30, 1942, and section 1155 terminated Apr. 30, 1943, under the provisions of section 1162.

Section 1153, act June 28, 1940, ch. 440, title I, § 3, 54 Stat. 677, limited the provisions of section 496 of former Title 34 to contracts exceeding $25,000.

Section 1154, act June 28, 1940, ch. 440, title I, § 4, 54 Stat. 677, provided for certification as to necessity and cost of special additional equipment and facilities acquired to facilitate construction of aircraft or naval vessels under section 496 of former Title 34. Notwithstanding the termination of this section on June 30, 1942, a provision thereof concerning reports to Congress was repealed by act Aug. 7, 1946, ch. 770, $1 (27), 60 Stat. 868.

Section 1155, act June 28, 1940, ch. 440, title I, 65, 64 Stat. 678, related to working hours and overtime compensation of Navy, Coast Guard, and Army employees. Res. July 3, 1942, ch. 482, 56 Stat. 645, as amended Oct. 2, 1942, ch. 577, 56 Stat. 765; Dec. 22, 1942, ch. 798, 56 Stat. 1068, cxtended from June 30, 1942, to and including Apr. 30, 1943, the provisions for the payment of overtime rates of compensation contained in sections 1151—1162.

Section 1156, act June 28, 1940, ch. 440, title I, $ 6, 54 Stat. 679; Aug. 21, 1941, ch. 385, 55 Stat. 654, related to reemployment of retired employees and to summary removal of civil service employees of the War and Navy Departments and the Coast Guard for national security reasons. Act Aug. 21, 1941, ch. 385, 55 Stat. 654, was repealed by Pub. L. 89-554, $ 8(a), Sept. 6, 1966, 80 Stat. 651.

Section 1157, act June 28, 1940, ch. 440, title I, § 7, 54 Stat. 679, added a temporary section 8 to act Mar. 14, 1936, ch. 140, 49 Stat. 611, providing for vacation pay in lieu of vacation for Navy and Coast Guard employees. For accumulation of annual leave, see section 6301 et seq. of Title 5, Government Organization and Employees.

Section 1158, acts June 28, 1940, ch. 440, title I, § 8, 54 Stat. 680; Sept. 16, 1940, ch. 720, $ 9. 54 Stat. 892, increased the limit of cost of vessels under section 498c-1 of former Title 34 and other statutes, suspended limitations on payments to certain Navy Department employees, and authorized the Secretary of the Navy to employ additional personnel and to provide and operate the necessary buildings, facilities, utilities, and appurtenances thereto for the purposes of sections 1151-1162. The latter provision is covered by section 1201 of this Appendix. Act Aug. 21, 1941, ch. 395, 55 Stat. 664, made the provisions of section 1158 applicable to naval publicworks projects authorized by that act and all prior acts. Notwithstanding the termination of this section on June 30, 1942, a provision thereof concerning reports to Congress was repealed by act Aug. 7, 1946, ch. 770. § 1 (28), 60 Stat. 868.

Section 1159, act June 28, 1940, ch. 440, title I. $ 9, 54 Stat. 680, authorized modification of existing Navy and Coast Guard contracts to expedite defense.

Section 1160, act June 28, 1940, ch. 440, title I, § 10, 64 Stat. 680, related to approval of certain Naval publicForks contracts under act April 25, 1939, ch. 87, § 4, 53 Stat. 590.

Section 1161, act June 28, 1940, ch. 440, title I, $ 11, 64 Stat. 680, related to employment of aliens in performance of secret, confidential, or restricted Government contracts.

Section 1162, act June 28, 1940, ch. 440, title I, § 12, 54 Stat. 681, provided that sections 1151—1161 should terminate June 30, 1942, unless Congress otherwise provided. Sections 1152 and 1155 were extended as shown in notes under those sections.

ACT JULY 2, 1940, CH. 508, 54 STAT. 712 $S 1171, 1172. Repealed. Aug. 10, 1956, ch. 1041, § 53,

70A Stat. 641. Section 1171, acts July 2, 1940, ch. 508, § 1, 54 Stat. 712; Sept. 9, 1940, ch. 717, title I, § 103, 54 Stat. 875; June 5, 1942, ch. 340, $ 13, 56 Stat. 317, related to contracts for Army defense facilities, construction of facilities, acquisition of military equipment munitions, and supplies, suspension of limitations on costs, operation and maintenance of facilities, and disposal of land and facilities.

Section 1172, act July 2, 1940, ch. 508, § 5, 54 Stat. 714, related to contracts for emergencies affecting national defense; limitation of amount; report of expenditures; compliance with statutory conditions for contracts.

ACT JULY 17, 1953, CH. 221, 67 STAT. 177 $S 1173 to 1175. Omitted.

Sections, act July 17, 1953, ch. 221, $$ 1–3, 67 Stat. 177, 178, provided for construction authority for the Armed Forces, activity reports by Secretary of Defense, and application to section 551 of Title 40, respectively.

Section 1173 amended July 26, 1954, ch. 570, $ 2, 68 Stat. 531.

Such provisions expired under the earlier date providing for their existence until six months after termination of national emergency proclaimed by the President on Dec. 16, 1950, or until such date as may be specified by a concurrent resolution of the Congress, or until July 1, 1957, under provisions of act June 21, 1956, ch. 420. 70 Stat. 325.

Section 1175 which prohibited construction to repeal or modify section 551 of Title 40 was also made inoperative with the repeal of such section 551 by act Aug. 10, 1956, ch. 1041, $ 53, 70 Stat. 641.

case of Defense Plant Corporation, Metals Reserve Company, Defense Supplies Corporation, and Rubber Reserve Company, the term "Secretary" means the board of directors of the appropriate corporation.

(3) The terms "renegotiate" and "renegotiation" include a determination by agreement or order under this section of the amount of any excessive profits.

(4) (A) The term "excessive profits” means the portion of the profits derived from contracts with the Departments and subcontracts which is determined in accordance with this section to be excesive. In determining excessive profits there shall be taken into consideration the following factors:

(1) efficiency of contractor, with particular regard to attainment of quantity and quality production, reduction of costs and economy in the use of materials, facilities, and manpower;

(ii) reasonableness of costs and profits, with particular regard to volume of production, normal prewar earnings, and comparison of war and peacetime products;

(iii) amount and source of public and private capital employed and net worth;

(iv) extent of risk assumed, including the risk incident to reasonable pricing policies;

(v) nature and extent of contribution to the war effort, including inventive and developmental contribution and cooperation with the Government and other contractors in supplying technical assistance;

(vi) character of business, including complexity of manufacturing technique, character and extent of subcontracting, and rate of turnover;

(vii) such other factors the consideration of which the public interest and fair and equitable dealing may require, which factors shall be published in the regulations of the Board from time to time as adopted.

(B) The term "profits derived from contracts with the Departments and subcontracts” means the excess of the amount received or accrued under such contracts and subcontracts over the costs paid or incurred with respect thereto. Such costs shall be determined in accordance with the method of cost accounting regularly employed by the contractor in keeping his books, but if no such method of cost accounting has been employed, or if the method so employed does not, in the opinion of the Board or, upon redetermination, in the opinion of The Tax Court of the United States properly reflect such costs, such costs shall be determined in accordance with such method as in the opinion of the Board or, upon redetermination, in the opinion of The Tax Court of the United States does properly reflect such costs. Irrespective of the method employed or prescribed for determining such costs, no item of - cost shall be charged to any contract with a Department or subcontract or used in any manner for the purpose of determining such cost, to the extent that in the opinion of the Board or, upon redetermination, in the opinion of The Tax Court of the United States, such item is unreasonable or

ACT JULY 11, 1941, CH. 290, $ 3, 55 STAT. 585 § 1181. Repealed. July 25, 1947, ch. 327, § 1, 61 Stat. 449.

Section, act July 11, 1941, ch. 290, § 3, 55 Stat. 586, authorized the Secretary of the Treasury to negotiate contracts for Coast Guard vessels, aircraft and equipment on the basis provided by section 1152 (a) of this Appendix.

ACT APR. 28, 1942, CH. 247, TITLE IV, § 403,

56 STAT. 245 $ 1191. Renegotiation of contracts; determination and

recovery of excess profits. (a) Definitions. For the purposes of this section

(1) The term "Department” means the Department of the Army, the Navy Department, the Treasury Department, the Maritime Commission, the War Shipping Administration, Defense Plant Corporation, Metals Reserve Company, Defense Supplies Corporation, and Rubber Reserve Company, respectively.

(2) In the case of the Maritime Commission, the term "Secretary" means the Chairman of such Commission, in the case of the War Shipping Administration, the term "Secretary" means the Administrator of such Administration, and in the

not properly chargeable to such contract or subcontract. Notwithstanding any other provisions of this section, all items estimated to be allowable as deductions and exclusions under Chapters 1 and 2E of the Internal Revenue Code (I.R.C. 1939) (excluding taxes measured by income) shall, to the extent allocable to such contracts and subcontracts (or, in the case of the recomputation of the amortization deduction, allocable to contracts with the Departments and subcontracts), be allowed as items of cost, but in determining the amount of excessive profits to be eliminated proper adjustment shall be made on account of the taxes so excluded, other than Federal taxes, which are attributable to the portion of the profits which are not excessive.

(C) Notwithstanding any of the provisions of this section to the contrary, no amount shall be allowed as an item of cost (i) by reason of a recomputation of the amortization deduction pursuant to section 124 (d) of the Internal Revenue Code (I.R.C. 1939] until after such recomputation has been made in connection with a determination of the taxes imposed by Chapters 1, 2A, 2B, 2D, and 2E of the Internal Revenue Code (I.R.C. 1939] for the fiscal year to which the excessive profits determined by the renegotiation are attributable or (ii) by reason of the application of a carry-over or carryback under any circumstances. The absence of such a recomputation of the amortization deductions referred to in clause (i) above shall not constitute a cause for postponing the making of an agreement, or the entry of an order, determining the amount of excessive profits, or for staying the elimination thereof.

(D) Notwithstanding any of the provisions of subsection (c) (4) of this section to the contrary, in the case of a renegotiation which is made prior to such recomputation, there shall be repaid by the United States (without interest) to the contractor or subcontractor after such recomputation the amount of a net renegotiation rebate computed in the following described manner. There shall first be ascertained the portion of the excessive profits determined by the renegotiation which is attributable to the fiscal year with respect to which a net renegotiation rebate is claimed by the contractor or subcontractor (hereinafter referred to as "renegotiated year'). There shall then be ascertained the amount of the gross renegotiation rebate for the renegotiated year, which amount shall be an allocable part of the additional amortization deduction which is allowed for the renegotiated year upon the recomputation made pursuant to section 124(d) of the Internal Revenue Code (I.R.C. 1939) in connection with the determination of the taxes for such year and which is attributable to contracts with the Departments and subcontracts, except that the amount of the gross renegotiation rebate shall not exceed the amount of excessive profits eliminated for the renegotiated year pursuant to the renegotiation. The allocation of the additional amortization deduction attributable to contracts with the Departments and subcontracts, and the allocation of the additional amortization deduction to the renego

tiated year shall be determined in accordance with regulations prescribed by the Board. There shall then be ascertained the amount of the contractor's or subcontractor's Federal tax benefit from the renegotiation for the renegotiated year. Such Federal tax benefit shall be the amount by which the taxes for the renegotiated year under Chapters 1, 2A, 2B, 2D, and 2E of the Internal Revenue Code [I.R.C. 1939) were decreased by reason of omitting from gross income (or by reason of the application of the provisions of section 3806(a) of the Internal Revenue Code (I.R.C. 1939) with respect to) that portion of the excessive profits for the renegotiated year which is equal to the amount of the gross renegotiation rebate. The amount by which the gross renegotiation rebate for the renegotiated year exceeds the amount of the contractor's or subcontractor's Federal tax benefit from the renegotiation for such year shall be the amount of the net renegotiation rebate for such year. A net renegotiation rebate shall not be repaid unless & claim therefor has been filed with the Board on or before the date of its abolition, or unless a claim shall have been filed with the Administrator of General Services (i) on or before December 31, 1952, or (ii) within ninety days after the making of an agreement or the entry of an order under subsection (c) (1) [of this section] determining the amount of excessive profits, whichever is later. A claim shall be deemed to have been filed when received by the Board or the Administrator, whether or not accompanied by a statement of the Commissioner of Internal Revenue showing the amortization deduction allowed for the renegotiated year upon the recomputation made pursuant to section 124 (d) of the Internal Revenue Code [I.R.C. 1939). (5) The term "subcontract" means

(A) Any purchase order or agreement to perform all or any part of the work, or to make or furnish any article, required for the performance of any other contract or subcontract, but such term does not include any purchase order or agreement to furnish office supplies; or

(B) Any contract or arrangement other than a contract or arrangement between two contracting parties, one of which parties is found by the Board to be a bona fide executive officer, partner, or full-time employees of the other contracting party, (i) any amount payable under which is contingent upon the procurement of a contract or contracts with a Department or of a subcontract or subcontracts, or determined with reference to the amount of such a contract or subcontract or such contracts or subcontracts, or (ii) under which any part of the services performed or to be performed consists of the soliciting, attempting to procure, or procuring a contract or contracts with a Department or a subcontract or subcontracts: Provided, That nothing in this sentence shall be construed (1) to affect in any way the validity or construction of provisions in any contract with a Department or any subcontract, heretofore at any time or hereafter made, prohibiting the payment of contingent fees or commissions; or (2) to restrict in any way the authority of the Secretary or the Board to determine the nature or amount of selling expenses under subcontracts as defined in this subparagraph, as a proper element of the contract price or as a reimbursable item of cost, under a contract with a Department or a subcontract.

(6) The term "article" includes any material, part, assembly, machinery, equipment, or other personal property.

(7) The term "standard commercial article" means an article

(A) which is identical in every material respect with an article which was manufactured and sold, and in general civilian, industrial, or commercial use prior to January 1, 1940,

(B) which is identical in every material respect with an article which is manufactured and sold, as a competitive product, by more than one manufacturer, or which is an article of the same kind and having the same use or uses as an article manufactured and sold, as a competitive product, by more than one manufacturer, and

(C) for which a maximum price has been established and is in effect under the Emergency Price Control Act of 1942, as amended, or under the Act of October 2, 1942, entitled "An Act to amend the Emergency Price Control Act of 1942, to aid in preventing inflation, and for other purposes", or which is sold at a price not in excess of the January 1, 1941, selling price. An article made in whole or in part of subsitute materials but otherwise identical in every material respect with the article with which it is compared under subparagraphs (A) and (B) shall be considered as identical in every respect with such article with which it is so compared.

(8) The term "fiscal year" means the taxable year of the contractor or subcontractor under Chapter 1 of the Internal Revenue Code (I.R.C. 1939).

(9) The terms “received or accrued" and "paid or incurred” shall be construed according to the method of accounting employed by the contractor

or subcontractor in keeping his books. (b) Provisions required to be inserted in contracts in

excess of $100,000. Subject to subsection (i) of this section, the Secretary of each Department is authorized and directed to insert in each contract made by such Department thirty days or more after the date of the enactment of the Revenue Act of 1943 and involving an estimated amount of more than $100,000, a provision under which the contractor agrees

(1) to the elimination of excessive profits through renegotiation;

(2) that there may be retained by the United States from amounts otherwise due the contractor, or that he will repay to the United States, if paid to him, any excessive profits;

(3) that he will insert in each subcontract described in subsection (a) (5) (A) [of this section] involving an estimated amount of more than $100,000, and in each subcontract described in subsection (a) (5) (B) (of this section) involving an esti

mated amount of more than $25,000, a provision under which the subcontractor agrees

(A) to the elimination of excessive profits through renegotiation;

(B) that there may be retained by the contractor for the United States from amounts otherwise due the subcontractor, or that the subcontractor will repay to the United States, if paid to him, any excessive profits;

(C) that the contractor shall be relieved of all liability to the subcontractor on account of any amount so retained, or so repaid by the subcontractor to the United States;

(D) that he will insert in each subcontract described in subsection (a) (5) (A) (of this section) involving an estimated amount of more than $100,000, and in each subcontract described in subsection (a) (5) (B) (of this section) involving an estimated amount of more than $25,000, provisions corresponding to those of subparagraphs (A), (B), and (C) and to those of this subparagraph;

(4) that there may be retained by the United States from amounts otherwise due the contractor, or that he will repay to the United States, as the Secretary may direct, any amounts which under paragraph (3) (B) of this subsection the contractor is directed to withhold from a subcontractor and which are actually unpaid at the

time the contractor receives such direction. The obligations assumed by the contractor or subcontractor under paragraph (1) or (3) (A) of this subsection, as the case may be, agreeing to the elimination of excessive profits through renegotiation shall be binding on him only if the contract or subcontract, as the case may be, is subject to subsection (c) of this section. A provision inserted in a contract or subcontract, which recites in substance that the contract or subcontract shall be deemed to contain all the provisions required by this subsection shall be sufficient compliance with this subsection. Whether or not there is inserted in a contract with a Department or subcontract, to which subsection (c) of this section is applicable, the provisions specified in this subsection, such contract or subcontract, as the case may be, shall be considered as having been made subject to such subsection in the same manner and to the same extent as if such provisions had been inserted. (c) Renegotiation of contract price on determination

of excess profits; notice of renegotiation; conclu. siveness of Board's order; withholding of amounts due contractors; actions by United States; limita. tions; agreements with contractors; filing of financial statements; powers of Board; Bureau of Inter. nal Revenue services available; contracts included. (1) Whenever, in the opinion of the Board, the amounts received or accrued under contracts with the Departments and subcontracts may reflect excessive profits, the Board shall give to the contractor or subcontractor, as the case may be, reasonable notice of the time and place of a conference to be held with respect thereto. The mailing of such notice by registered mail to the contractor or subcontractor shall constitute the commencement of the renegotiation proceeding. At the conference, which may be adjourned from time to time, the Board shall

endeavor to make a final or other agreement with the contractor or subcontractor with respect to the elimination of excessive profits received or accrued, and with respect to such other matters relating thereto as the Board deems advisable. Any such agreement, if made, may, with the consent of the contractor or subcontractor, also include provisions with respect to the elimination of excessive profits likely to be received or accrued. If the Board does not make an agreement with respect to the elimina. tion of excessive profits received or accrued, it shall issue and enter an order determining the amount, if any, of such excessive profits, and forthwith give notice thereof by registered mail to the contractor or subcontractor. In the absence of the filing of a petition with The Tax Court of the United States under the provisions of and within the time limit prescribed in subsection (e) (1) of this section, such order shall be final and conclusive and shall not be subject to review or redetermination by any court or other agency. The Board shall exercise its powers with respect to the aggregate of the amounts received or accrued during the fiscal year (or such other period as may be fixed by mutual agreement) by a contractor or subcontractor under contracts with the Departments and subcontracts, and not separately with respect to amounts received or accrued under ser rate contracts with the Departments or subcontracts, except that the Board may exercise such powers separately with respect to amounts received or accrued by the contractor or subcontractor under any one or more separate contracts with the Departments or subcontracts at the request of the contractor or subcontractor. Whenever the Board makes a determination with respect to the amount of excessive profits, whether such determination is made by order or is embodied in an agreement with the contractor or subcontractor, it shall, at the request of the contractor or subcontractor, as the case may be, prepare and furnish such contractor or subcontractor with a statement of such determination, of the facts used as a basis therefor, and of its reasons for such determination. Such statement shall not be used in The Tax Court of the United States as proof of the facts or conclusions stated therein.

(2) Upon the making of an agreement, or the entry of an order, under paragraph (1) of this subsection by the Board, or the entry of an order under subsection (e) of this section by The Tax Court of the United States, determining excessive profits, the Board shall forthwith authorize and direct the Secretaries or any of them to eliminate such excessive profits (A) by reductions in the amounts otherwise payable to the contractor under contracts with the Departments, or by other revision of their terms; or (B) by withholding from amounts otherwise due to the contractor any amount of such excessive profits; or (C) by directing tractor to withhold for the account of the United States, from amounts otherwise due to a subcontractor, any amount of such excessive profits of such subcontractor; or (D) by recovery from the contractor, through repayment, credit, or suit any amount of such excessive profits actually paid to him; or (E) by any combination of these methods, as is deemed desirable. Actions on behalf of the

United States may be brought in the appropriate courts of the United States to recover from the contractor any amount of such excessive profits actually paid to him and not withheld or eliminated by some other method under this subsection. The surety under a contract or subcontract shall not be liable for the repayment of any excessive profits thereon. Each contractor and subcontractor is indemnified by the United States against all claims by any subcontractor on account of amounts withheld from such subcontractor pursuant to this paragraph. All money recovered in respect of amounts paid to the contractor from appropriations from the Treasury by way of repayment or suit under this subsection shall be covered into the Treasury as miscellaneous receipts. Upon the withholding of any amount of excessive profits or the crediting of any amount of excessive profits against amounts otherwise due a contractor, the Secretary shall certify the amount thereof to the Treasury and the appropriations of his Department shall be reduced by an amount equal to the amount so withheld or credited. The amount of such reductions shall he transferred to the surplus fund of the Treasury. In eliminating excessive profits the Secretary shall allow the contractor or subcontractor credit for Federal income and excess profits taxes as provided in section 3806 of the Internal Revenue Code (I.R.C. 1939). For the purposes of this paragraph the term "contractor" includes a subcontractor.

(3) No proceeding to determine the amount of excessive profits shall be commenced more than one year after the close of the fiscal year in which such excessive profits were received or accrued, or more than one year after the statement required under paragraph (5) of this subsection is filed with the Board, whichever is the later, and if such proceeding is not so commenced, then upon the expiration of one year following the close of such fiscal year, or one year following the date upon which such statement is so filed, whichever is the later, all liabilities of the contractor or subcontractor for excessive profits received or accrued during such fiscal year shall thereupon be discharged. If an agreement or order determining the amount of excessive profits is not made within one year following the commencement of the renegotiation proceeding, then upon the expiration of such one year all liabilities of the contractor or subcontractor for excessive profits with respect to which such proceeding was commenced shall thereupon be discharged, except that (A) if an order is made within such one year by the Secretary (or an officer or agency designated by the Secretary) pursuant to a delegation of authority under subsection (d) (4) of this section such one-year limitation shall not apply to review of such order by the Board, and (B) such one-year period may be extended by mutual agreement.

(4) For the purposes of this section the Board may make final or other agreements with a contractor or subcontractor for the elimination of excessive profits and for the discharge of any liability for excessive profits under this section. Such agreements may contain such terms and conditions as the Board deems advisable. Any such agreement shall be conclusive according to its terms; and except upon a

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