Court Opinion

ID: 6870973
Source: CourtListenerOpinion
Date Created: 2022-07-23 21:01:07.65171+00
Date Added: 2024-06-11T16:05:24.355892
License: Public Domain

GARRECHT, Circuit Judge
(dissenting).
The majority of the court in reversing the order of the Board of Tax Appeals rely upon the decision of the Supreme Court in Palmer v. Bender, 287 U.S. 551, 53 S.Ct. 225, 77 L.Ed. 489.
In that case the taxpayer very definitely had an economic interest in the oil and faxes were assessed on payments made from oil produced, but here the payments taxed were made in cash and were not dependent upon the production of oil.
The gross income from the property which is subject to the depletion allowance is the gross income from the oil and gas produced. Helvering v. Twin Bell Syndicate, 293 U.S. 312, 55 S.Ct. 174, 79 L.Ed. 383. Here the payments subjected to the tax did not depend upon production but were payable in any event. Commissioner of Internal Revenue v. Fleming (C.C.A.) 82 F.(2d) 324.
The order of the Board of Tax Appeals should be sustained.