Court Opinion

ID: 9448737
Source: CourtListenerOpinion
Date Created: 2023-08-03 23:44:06.752107+00
Date Added: 2024-06-11T17:31:32.610508
License: Public Domain

On Petition for Rehearing.
ALDRICH,
Circuit Judge.
 Taxpayer’s petition for rehearing essentially repeats that sales price necessarily means “f. o. b. factory.” The statute does not so provide. Nor does taxpayer answer the question we proposed in oral argument that if there were two factories, one on the east coast, and one on the west where the f. o. b. price was higher, would the tax on a west coast purchase be at the east coast price because the customer could have chosen to buy there? We would not distinguish for the purpose of this tax between a place of production and a place of distribution. If a customer finds the articles located at a particular place of distribution, where he necessarily pays a certain price, more desirable, that is the “price” of those particular articles. At least that must be so after twenty years of administrative practice. Taxpayer not only seeks to discount a G.C.M. as representing administrative practice, but cf. Helvering v. Janney, 1940, 311 U.S. 189, 61 S.Ct. 241, 85 L.Ed. 118; McFeely v. Commissioner, 1935, 296 U.S. 102, 56 S.Ct. 54, 80 L.Ed. 83; but to disregard Fitch’s reference to this one. As we have already observed, taxpayer is sometimes given to applying its blind eye to the telescope when looking at Fitch. However, the question is not simply how much force the ruling had when it was issued, but how much it has accumulated. See Griswold, A Summary of the Regulations Problem, 1951, 54 Harv.L.Rev. 398, 417-18.
Because we found it unnecessary to rely on Treas.Reg. 46 (1940 ed.) 316.12, we did not deal with taxpayer’s contention, again repeated, that this regulation was “superseded” by Regulation 330.1-1 (1958). Section 330.1-1 does not in terms repeal anything, and we believe did not repeal section 316.12 unless there was an inconsistency. We find none. It may be noted that the last sentence expressly condemns a separate billing of “expenses” as a means of avoiding the tax.
The petition for rehearing is denied.
WOODBURY, Chief Judge, dissents.