Commissioner of Int. Rev. v. COMMUNITY PUB. SERV. CO.
Decision Date | 05 August 1950 |
Docket Number | No. 13049.,13049. |
Citation | 183 F.2d 765 |
Parties | COMMISSIONER OF INTERNAL REVENUE v. COMMUNITY PUBLIC SERVICE CO. |
Court | U.S. Court of Appeals — Fifth Circuit |
Howard P. Locke, Sp. Asst. to the Atty. Gen., Theron Lamar Caudle, Asst. Atty. Gen., Ellis N. Slack, Sp. Asst. to the Atty. Gen., Charles Oliphant, Chief Counsel, Bur. Int. Rev. and Claude R. Marshall, Sp. Atty., Bur. Int. Rev., Washington, D. C., Helen Goodner, Sp. Asst. to Atty. Gen., Carlton Fox, Sp. Asst. to Atty. Gen., for petitioner.
Sam G. Winstead, J. P. Jackson, Dallas, Texas, Bennett L. Smith, Ft. Worth, Texas, for respondent.
Before HUTCHESON, Chief Judge, and McCORD and RUSSELL, Circuit Judges.
This is another of the instances, all too common in tax cases, in which the present uncoordinated, disconnected, and, to the uninitiate, unrelated, patchwork state of the Income Tax Statutes raises difficulties in the way of a correct solution of the tax puzzle the particular case presents.1
The question posed, the problem presented, here is whether the Tax Court was right in holding that, in computing its unused excess profits credits carry over from 1941 and 1942 to be used in computing 1943 tax, the taxpayer could compute such credits by applying a 1943 amendment2 which, by its terms, provided that the provisions were "deemed to be included in the Revenue Laws applicable to all years beginning after 1933", but that they "should not affect any tax liability for any taxable year beginning prior to Jan. 1, 1943".
The Tax Court stating: went on to say that its decision in the Moore case (note 1, supra) dealing with a different statute and cited by taxpayer by way of analogy, was in principle applicable here.
Basing its decision, however, upon the undisputed fact that, in 1935, petitioner acquired from its predecessor corporation certain assets through a bankruptcy proceeding which was within Sec. 121 of the Rev.Act of 1943, and pointing with emphasis to the express provision of Sec. 121(e) Effective Date, that the referred to amendments "shall be deemed to be included in the revenue laws respectively applicable to the taxable years beginning after Dec. 31, 1933, but shall not affect any tax liability for any taxable years beginning prior to Jan. 1, 1943," and to Regulation 111, Sec. 29.113(a) (22),3 the Tax Court thus reasoned the matter out: * * *"
After this case had been tried in the Tax Court, a writ of certiorari was granted in the Reo case on the ground of a conflict between it and Moore's case. The decision in the Reo case was affirmed and that in the Moore case was disapproved, with the result that, deprived of the prop or support of the Moore case, the Tax Court's opinion must stand or fall upon the soundness or unsoundness of the reasoning quoted hereinabove.
As might be expected in this turn of affairs, the commissioner, completely oblivious of the Reo case before it received its accolade in the Supreme Court, now points to it with pride as a complete refutation, and the authority for the overthrow, of the Tax Court's decision.
The taxpayer, on its part, exhibiting like unconcern for consistency and the same readiness and ability to shift ground and change front, is apparently not at all troubled by the fall of Moore's case before the onslaught of Reo's. It now advises us that neither of those cases is in point, for the simple reason that in both of those cases the amendments in question were expressly made inapplicable to prior taxable years while the 1943 Act makes express provision for such retroactivity.
Standing precisely and firmly upon the different language of the Statute involved here, it urges upon us that the Tax Court's...
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