Section 54. (a) Except as otherwise provided in subsection (b), any person in possession of, or obligated with respect to, property or rights to property subject to levy upon which a levy has been made shall, upon demand of the commissioner, surrender such property or rights, or discharge such obligation, to the commissioner, except such part of the property or rights as is, at the time of such demand, subject to an attachment or execution under any judicial process.

(b)(1) A levy on an organization with respect to a life insurance or endowment contract issued by such organization shall, without necessity for the surrender of the contract document, constitute a demand by the commissioner for payment of the amount described in paragraph (2) and the exercise of the right of the person against whom the tax is assessed to the advance of such amount. Such organization shall pay over such amount ninety days after service of notice of levy. Such notice shall include a certification by the commissioner that a copy of such notice has been mailed to the person against whom the tax is assessed at his last known address.

(2) Such levy shall be deemed to be satisfied if such organization pays over to the commissioner the amount which the person against whom the tax is assessed could have had advanced to him by such organization on the date prescribed in paragraph (1) for the satisfaction of such levy, increased by the amount of any advance, including contractual interest, thereon, made to such person on or after the date such organization had actual notice or knowledge of the existence of the lien with respect to which such levy is made, other than an advance, including contractual interest thereon, made automatically to maintain such contract in force under an agreement entered into before such organization had such notice or knowledge.

(3) The satisfaction of a levy under paragraph (2) shall be without prejudice to any civil action for the enforcement of any lien imposed by section fifty with respect to such contract.

(c)(1) Any person who fails or refuses to surrender any property or rights to property, subject to levy, upon demand by the commissioner, shall be liable in his own person and estate to the commonwealth in a sum equal to the value of the property or rights not so surrendered, but not exceeding the amount of taxes for the collection of which such levy has been made, together with costs and interests on such sum at the rate of eight per cent per annum from the date of such levy. Any amount, other than costs, recovered under this paragraph shall be credited against the tax liability for the collection of which such levy was made.

(2) In addition to the personal liability imposed by paragraph (1), if any person required to surrender property or rights to property fails or refuses to surrender such property or rights to property without reasonable cause, such person shall be liable for a penalty equal to fifty per cent of the amount recoverable under paragraph (1). No part of such penalty shall be credited against the tax liability for the collection of which such levy was made.

(d) Any person in possession of, or obligated with respect to, property or rights to property subject to levy upon which a levy has been made, who, upon demand by the commissioner, surrenders such property or rights to property, or discharges such obligation, to the commissioner, or who pays a liability under paragraph (1) of subsection (c) shall be discharged from any obligation or liability to the delinquent taxpayer with respect to such property or rights to property arising from such surrender or payment. In the case of a levy which is satisfied pursuant to subsection (b), such organization shall also be discharged from any obligation or liability to any beneficiary arising from such surrender or payment.

(e) The commissioner may, in his discretion, reimburse a taxpayer for any fee or similar amount charged to the taxpayer by a bank or financial institution where such fee or charge proximately resulted from the commissioner's improper or erroneous service of a notice of lien or levy on such bank or financial institution.