Court Opinion

ID: 6923527
Source: CourtListenerOpinion
Date Created: 2022-07-23 23:10:17.804074+00
Date Added: 2024-06-11T16:06:52.041256
License: Public Domain

Upon Petitions for Rehearing
PER CURIAM.
The following statement appears in the court’s opinion at page 626:
“We conclude from the foregoing that each of the institutions here is a bank as defined by § 104 of the Internal Revenue Code of 1939, as amended.”
The respondents, petitioners herein, point out in their petitions for rehearing that section 104 defines “banks” as being institutions which are, inter alia, “subject by law to supervision and examination by State * * * or Federal authority having supervision over banking institutions.” Since in California banks are “supervised” by the Superintendent of Banks and respondents are “supervised” by the California Corporations Commissioner, the petitioners claim that a vital element in the definition of banks under section 104 is missing and that consequently petitioners cannot be “banks”.
While strictly speaking the above mentioned element in the definition of “banks” would not appear to be present in this ease, we are, nevertheless, of the opinion that petitioners ax’e “banks” within the intent and meaning of section 104. The federal tax laws are to be administered uniformly. The petitioners in substance have all the attributes of banks for purposes of the taxes here involved and therefore they should be treated accordingly. The authorities which have been discussed establish that state law does not control what institutions are “banks” within the federal tax statutes. Just as in Staunton where the industrial loan association was organized under different state authority than were banks petitioners are organized in a manner different from banks and are controlled by different state authorities, albeit the *630state controls are stringent in either case. California’s statutory choice based upon state criteria of exercising control by different authority over similar institutions cannot bring these petitioners without the confines of the definition of “banks” for federal tax purposes where the pertinent characteristics of the petitioner institutions are in substance the same as banks.
The opinion of the court is amended by the foregoing, and the petitions for rehearing are denied.