What follows is an opinion from the Supreme Court of the United States. Your task is to determine the bases on which the Supreme Court rested its decision with regard to the legal provision that the Court considered in the case. Consider "judicial review (national level)" if the majority determined the constitutionality of some action taken by some unit or official of the federal government, including an interstate compact. Consider "judicial review (state level)" if the majority determined the constitutionality of some action taken by some unit or official of a state or local government. Consider "statutory construction" for cases where the majority interpret a federal statute, treaty, or court rule; if the Court interprets a federal statute governing the powers or jurisdiction of a federal court; if the Court construes a state law as incompatible with a federal law; or if an administrative official interprets a federal statute. Do not consider "statutory construction" where an administrative agency or official acts "pursuant to" a statute, unless the Court interprets the statute to determine if administrative action is proper. Consider "interpretation of administrative regulation or rule, or executive order" if the majority treats federal administrative action in arriving at its decision.Consider "diversity jurisdiction" if the majority said in approximately so many words that under its diversity jurisdiction it is interpreting state law. Consider "federal common law" if the majority indicate that it used a judge-made "doctrine" or "rule; if the Court without more merely specifies the disposition the Court has made of the case and cites one or more of its own previously decided cases unless the citation is qualified by the word "see."; if the case concerns admiralty or maritime law, or some other aspect of the law of nations other than a treaty; if the case concerns the retroactive application of a constitutional provision or a previous decision of the Court; if the case concerns an exclusionary rule, the harmless error rule (though not the statute), the abstention doctrine, comity, res judicata, or collateral estoppel; or if the case concerns a "rule" or "doctrine" that is not specified as related to or connected with a constitutional or statutory provision. Consider "Supreme Court supervision of lower federal or state courts or original jurisdiction" otherwise (i.e., the residual code); for issues pertaining to non-statutorily based Judicial Power topics; for cases arising under the Court's original jurisdiction; in cases in which the Court denied or dismissed the petition for review or where the decision of a lower court is affirmed by a tie vote; or in workers' compensation litigation involving statutory interpretation and, in addition, a discussion of jury determination and/or the sufficiency of the evidence.

Opinion:
ALISON v. UNITED STATES.
NO. 79.
Argued November 12, 1952.
Decided December 8, 1952.
Karl E. Weise argued the cause for Alison in No. 79. With him on the brief was Paul Kern Hirsch.
Hilbert P. Zarky argued the cause for the United States in Nos. 79 and 80. With him on the brief were Acting Solicitor General Stern, Assistant Attorney General Lyon, Ellis N. Slack and Lee A. Jackson.
David B. Buerger argued the cause for Stevenson-Chislett, Inc. in No. 80. With him on the brief was George M. Heinitsh, Jr.
Mr. Justice Black
delivered the opinion of the Court.
The questions in these two income tax cases are so much alike that they can be treated in one opinion. Both taxpayers had moneys embezzled by trusted agents and employees. As' usual, the defalcations had been going on for many years before they were discovered. On discovery, efforts were made immediately to identify the takers and fix the dates and amounts of the thefts. In the Alison case, No. 79, the books revealed the thief and the precise amounts taken each year from 1931 to 1940. In No. 80, Stevenson-Chislett, Inc., the cover-up had been so successful that painstaking investigation failed to reveal who took the funds or the time when the un-ascertained person or persons took them. Each taxpayer claimed a tax deduction for the year the losses were discovered and their amounts ascertained. The Government objected, claiming that the deduction should have been taken in each of the prior years during which the moneys were being surreptitiously taken. In the Stevenson-Chislett case, the District Court held that the uncertain circumstances of the embezzlement entitled the taxpayer to take its losses the year the loss was discovered and the amount ascertained. 98 F. Supp. 252. The District Judge decided the other way in the Alison case and denied her declarations. 97 F. Supp. 959. His holding, however, was not in accord with his own views, but was compelled, he thought, by the Third Circuit’s decision in First National Bank of Sharon, Pa. v. Heiner, 66 F. 2d 925. The Court of Appeals for the Third Circuit certified to us the question of deductibility in both cases. Pursuant to 28 U. S. C. § 1254 (3), we ordered the complete records sent up so that we might decide the entire matters in controversy.
Internal Revenue Code, §§23 (e) and (f) authorize deductions for “. . . losses sustained during the taxable year. . . .” The Government reads this section as requiring a taxpayer to take a deduction for loss from embezzlement in the year in which the theft occurs, even though inability to discover in time might completely deprive the taxpayer of the benefit of this statutory deduction. Only at the time the money is stolen, so it is argued, is a loss “sustained.” But Treasury practice itself belies this rigid construction. For more than thirty years the Regulations have provided that “A loss from theft or embezzlement occurring in one year and discovered in another is ordinarily deductible for the year in which sustained.” 26 CFR § 29.43-2. (Emphasis supplied.) Information contained in a letter from the Commissioner attached as an appendix to the Government’s brief cites many instances in which the Treasury has allowed deductions for embezzlement losses in years subsequent to those in which the thefts occurred. Apparently the Department has felt constrained to do this in order to prevent hardships and injustice. These have been departures from the “ordinary” rule of attributing embezzlement losses to the year of theft.
This Treasury practice evidently stems at least in part from the special nature of the crime of embezzlement. Its essence is secrecy. Taxpayers are usually well aware of all the circumstances of financial losses for which tax deductions are allowed. Not so when a trusted adviser or employee steals. For years his crime may be known only to himself. He may take money planning to return it and he may return it before there is discovery. Furthermore, the terms embezzlement and loss are not synonymous. The theft occurs, but whether there is a loss may remain uncertain. One whose funds have been embezzled may pursue the wrongdoer and recover his property wholly or in part. See Commissioner v. Wilcox, 327 U. S. 404. Events in the Alison case show the practical value of this right of recovery. A substantial proportion of the embezzled funds was recovered in 1941, ten years after the first embezzlement occurred. This recovery alone is ample refutation of the view that a loss is inevitably “sustained” at the very time an embezzlement is committed.
Whether and when a deductible loss results from an embezzlement is a factual question, a practical one to be decided according to surrounding circumstances. See Boehm v. Commissioner, 326 U. S. 287. An inflexible rule is not needed; the statute does not compel it. For years the Treasury has administered the tax law under regulations saying that deductions shall “ordinarily” be taken in the year of embezzlement. Ordinarily does not mean always.
We hold that the special factual circumstances found by the District Courts in both these cases justify deductions under I. R. C., §§23 (e) and (f) and the long-standing Treasury Regulations applicable to embezzlement losses. See Boston Consolidated Gas Co. v. Commissioner, 128 F. 2d 473; Gwinn Bros. & Co. v. Commissioner, 7 T. C. 320. Accordingly, the judgment in No. 79 is reversed and the judgment in No. 80 is affirmed.
It is so ordered.
Mr. Justice Douglas and Mr. Justice Burton dissent.

Question: What is the basis of the Supreme Court's decision?

Choices:
judicial review (national level)
judicial review (state level)
Supreme Court supervision of lower federal or state courts or original jurisdiction
statutory construction
interpretation of administrative regulation or rule, or executive order
diversity jurisdiction
federal common law

Answer: 3
4