Court Opinion

ID: 4474417
Source: CourtListenerOpinion
Date Created: 2020-01-16 21:10:55.576022+00
Date Added: 2024-06-11T15:04:28.245487
License: Public Domain

Oppeh, J., dissenting: I can not distinguish this case from Schuman Carriage Co., Ltd., 43 B. T. A. 880, where likewise a hybrid system of reporting income was disapproved by respondent, and amounts on the books which should have been reported in prior years were included in the current year’s income. It is altogether different from Greene Motor Co., 5 T. C. 314, which involved erroneous reserve accounts and was controlled by such cases as S. Rossin & Sons, Inc. v. Commissioner (C. C. A., 3d Cir.), 113 Fed. (2d) 652. In Schuman Carriage Co., Ltd., supra, we said: * * * We think that it is immaterial that the stipulated facts in this case show that the petitioner has never recorded in its books of account interest accrued but only interest collected. ******* * * * The facts are, however, that there was an amount of accrued interest income upon the petitioner’s books of account at January 1,1934, which had never been returned for taxation. Manifestly, this amount must be included in the gross income of some year. The failure of the petitioner to make its returns consistently upon the accrual basis may place it in an unfortunate position. But for this situation the petitioner is alone to blame. If we substitute for “interest” the “credit sales” account here in controversy, the identical statements would have to be made in this case. Unless we are prepared to overrule Schuman Carriage Co., Ltd., supra, I think it should be followed here.