Commissioner of Int. Rev. v. Bondholders Comm

7 Citing cases

  1. Bondholders Committee v. Comm'r

    315 U.S. 189 (1942)   Cited 30 times

    Section 113(a)(7) of the Revenue Act of 1932 authorizes a carry-over of the basis of the properties in the lands of the transferor, not their basis in the hands of one who may have occupied an earlier position in the chain of ownership. P. 192. 3. The reorganization provisions here in question cover only inter-corporate transactions. P. 193. 4. Section 112(b)(5) of the Revenue Act, supra, includes transfers by individuals, but requires that the transferor remain in control, it being inapplicable where the transferor is bought out for cash. P. 193. 5. The cost of assets bid in by a mortgage creditor on foreclosure is to be determined by the fair market value of the property. P. 193. 118 F.2d 511, affirmed. CERTIORARI, 314 U.S. 590, to review judgments which reversed decisions of the Board of Tax Appeals, 40 B.T.A. 882, overruling deficiency assessments.

  2. Estate of Walling v. C.I.R

    373 F.2d 190 (3d Cir. 1967)   Cited 18 times

    " The obvious legislative object of § 351 and its statutory predecessor, § 112(b)(5) of the 1939 Code, is that Congress did not intend to tax "mere change[s] in the form of ownership." Jordan Marsh Co. v. CIR, 269 F.2d 453, 456 (C.A.2, 1959); Barker v. United States, 200 F.2d 223, 228 (C.A.9, 1952); Trenton Cotton Oil Co. v. CIR, 147 F.2d 33, 36 (C.A.6, 1945); CIR v. Bondholders Committee, 118 F.2d 511, 513 (C.A.9, 1941), aff'd, 315 U.S. 189, 62 S.Ct. 537, 86 L.Ed. 784 (1942); Portland Oil Co. v. CIR, 109 F.2d 479, 488 (C.A.1, 1940); Coastal Terminals, Inc. v. United States, 207 F. Supp. 560 (E.D.S.C., 1962); Sayre v. United States, 163 F. Supp. 495 (S.D. W.Va. 1958). Nevertheless, petitioners have here made a transfer, albeit a non-taxable one.

  3. D.W. Klein Co. v. Commr. of Internal Revenue

    123 F.2d 871 (7th Cir. 1941)   Cited 9 times

    We therefore conclude that the taxpayer was a new enterprise rather than a legal continuation of the Royal Cloak Company, hence that the basis for computing gain or loss and depreciation was not that of the Royal Company. Our attention has been called to four cases now pending before the Supreme Court: Commissioner v. Southwest Consol. Corp., 5 Cir., 119 F.2d 561; Commissioner v. Alabama Asphaltic Limestone Co., 5 Cir., 119 F.2d 819; Commissioner v. Palm Springs Holding Corp., 9 Cir., 119 F.2d 846; and Commissioner v. Bondholders Committee, 9 Cir., 118 F.2d 511. However, all these cases are more of the Kitselman or Rex type, involving representation of the old company in the new by creditors or bondholders.

  4. Helvering v. New Haven S.L.R. Co.

    121 F.2d 985 (2d Cir. 1941)   Cited 23 times
    In Helvering v. New Haven S.L.R. Co., Inc., 2 Cir., 121 F.2d 985, 988, it was held in relation to section 112(b)(5) of the Internal Revenue Act that for income tax purposes a transaction cannot be separated into its several steps and the last step treated as though it stood alone.

    Did the seller's insolvency provide the required "continuity of interest"? That question has come up five times, under the Act of 1928 or the Act of 1934, either as a question of "recognizable" gain or loss, or of depreciation. Three circuit courts of appeal have held that there was a "reorganization" — one of them since LeTulle v. Scofield, supra, 308 U.S. 415, 60 S.Ct. 313, 84 L.Ed. 355, was decided. Commissioner v. Kitselman, 7 Cir., 89 F.2d 458; Commissioner v. Newberry L. C. Co., 6 Cir., 94 F.2d 447; Commissioner v. Southwest Consolidated Corp., 5 Cir., 119 F.2d 561, and Commissioner v. Alabama Asphaltic Co., 5 Cir., 119 F.2d 819. The Ninth Circuit has, however, held otherwise, Commissioner v. Marlborough House, Inc., 9 Cir., 118 F.2d 511. It seems to us that the majority has been right. Certainly LeTulle v. Scofield, supra, 308 U.S. 415, 60 S.Ct. 313, 84 L.Ed. 355, had no such question in mind, in spite of its including Commissioner v. Kitselman, supra, in the note on page 420 of 308 U.S., on page 316 of 60 S.Ct., 84 L.Ed. 355; it very explicitly put the decision on the fact that creditors, no matter how distant might be the maturity of their debts, had no interest in the debtor's property, even though they were secured by a lien. The reason is not far to seek.

  5. Helvering v. New President Corporation

    122 F.2d 92 (8th Cir. 1941)   Cited 10 times

    The interest which the noteholders acquired in the name of The New President Corporation was a bondholder's interest prior to the foreclosure sale and an interest of a purchaser at and subsequent to the foreclosure sale, hence under authority of LeTulle v. Scofield, supra, there was no statutory reorganization. See, also, Com'r of Internal Revenue v. Bondholders Committee, 9 Cir., 118 F.2d 511. On the question of what value should be placed upon the property of the President Hotel Corporation acquired by the agent at the foreclosure sale in September, 1933, it has been heretofore noted that the agent of the pooling first mortgage noteholders purchased the assets of the old corporation at the sale for those noteholders and then conveyed all of the property to the new corporation which in turn transferred all of its stock to those noteholders in accordance with a pre-arranged plan.

  6. Commissioner v. Palm Springs Holding Corp.

    119 F.2d 846 (9th Cir. 1941)   Cited 4 times

    Neither amounted to a reorganization. Pinellas Ice Cold Storage Co. v. Commissioner, 287 U.S. 462, 468-470, 53 S.Ct. 257, 77 L.Ed. 428; LeTulle v. Scofield, 308 U.S. 415, 419-421, 60 S.Ct. 313, 84 L.Ed. 355; Helvering v. Tyng, 308 U.S. 527, 60 S.Ct. 378, 84 L.Ed. 445; Commissioner v. Bondholders Committee, 9 Cir., 118 F.2d 511, decided March 8, 1941. The contrary view derives no support from Commissioner v. Kitselman, 7 Cir., 89 F.2d 458, or from Newberry Lumber Chemical Co. v. Commissioner, 6 Cir., 94 F.2d 447.

  7. Commissioner of Int. Rev. v. Southwest Consol

    119 F.2d 561 (5th Cir. 1941)   Cited 12 times
    In Commissioner v. Southwest Consolidated Corp., 5 Cir., 119 F.2d 561, cited by the taxpayer, stock of the transferee was exchanged for stock, as well as bonds, of the transferor, thus permitting the transferor's stockholders to retain a proprietary interest in the corporate enterprise.

    The case may be easily distinguished and we do not consider it controlling. The Commissioner also cites Commissioner v. Bondholders Committee (Commissioner v. Marlborough House, Inc.), 9 Cir., 118 F.2d 511, decided after this case was submitted. Those cases may be distinguished from the case at bar.