Court Opinion

ID: 4477248
Source: CourtListenerOpinion
Date Created: 2020-01-16 21:12:26.29685+00
Date Added: 2024-06-11T15:03:29.697480
License: Public Domain

Withey, J., dissenting: I dissent from the majority opinion in this case because I am not at all convinced that the opposite conclusion to that therein reached would do violence to the Congressional intent or over-all plan as evidenced by section 711 of the Internal Revenue Code of 1939 which would warrant and justify the rewriting of the clear and unambiguous language of section 711 (b) (1) (K) (ii) as the majority have in effect done. Application of the rule of construction which permits disregard of clear statutory language in order not to do violence to an obvious Congressional intent is not justified where under the literal interpretation of the statute it may be said to have an area of effect within the general plan of legislation. Such an area is obvious here, exemplified by situations arising under business leases where the rental is based upon a “floor” with an increase arising from an increase in gross income, where royalty payments are made regardless of the amount of sales but are fixed upon a basis of gross income only, no payment being made where, even though sales existed, there was a loss in gross income and, among other considerable and varied business situations, where bonuses are paid to company officials dependent solely upon an increase in gross income. It is obvious under the facts in the instant case that had there been an actual loss in gross income regardless of the amount of sales, which is a distinct possibility, the royalty payments would necessarily have been made.