United States Gypsum Company (USG) and United States Gypsum Export Company (Export), a wholly owned subsidiary of USG, brought actions for refund of income taxes. Some of taxpayers' claims were established. The only issues before us on appeal relate to offsets claimed by the government on account of reallocations of income under 26 U.S.C. § 482 between USG and Export and between USG and another subsidiary, Panama Gypsum Company, Inc. (PG). The decision of the district court is reported at 304 F. Supp. 627 (N.D.Ill., 1969), and we shall avoid unnecessary repetition. The Shipping Issue.

Petitioners direct our attention primarily to the following WHTC opinions: Frank v. International Canadian Corp., 308 F.2d 520 (9th Cir. 1962); Babson Brothers Export Co. v. Commissioner, T.C. Memo. 1963-144. Respondent contends that "Cases arising under * * * [the WHTC provisions] are not applicable to a section 936 issue" (a contention we reject), and urges us to focus on "the contrary holding in another section 921 case,United States Gypsum Company v. United States", 304 F. Supp. 627 (N.D.Ill. 1969), affd. in part and revd. in part 452 F.2d 445 (7th Cir. 1971). Frank v. International Canadian Corp., supra, involved the following situation.

Petitioners direct our attention primarily to the following WHTC opinions: Frank v. International Canadian Corp., 308 F.2d 520 (9th Cir.1962); Babson Brothers Export Co. v. Commissioner, T.C. Memo.1963–144. Respondent contends that “Cases arising under * * * [the WHTC provisions] are not applicable to a section 936 issue” (a contention we reject), and urges us to focus on “the contrary holding in another section 921 case, United States Gypsum Company v. United States”, 304 F.Supp. 627 (N.D.Ill.1969), affd. in part and revd. in part 452 F.2d 445 (7th Cir.1971). Frank v. International Canadian Corp.,supra, involved the following situation.

It has been held, and we agree, that the provision cannot be utilized unless it is invoked within the Treasury. Maxwell Hardware Co. v. Commissioner, 343 F.2d 713, 721 (9th Cir. 1965); United States Gypsum Co. v. United States, 304 F. Supp. 627, 636 (N.D.Ill., 1969), aff'd on this issue, 452 F.2d 445, 450 (7th Cir., 1971). It is uncontested that in this case the District Director was a proper delegate of the Secretary under Section 482. For this reason, we deny plaintiff's motion for an order compelling production of documents. That motion seeks to show, through production of internal memoranda within the Government, that the Service did not itself initiate the notion of reliance on Section 482 and that the Department of Justice first made that suggestion to the Service, and strongly so.

This procedure particularly lends itself to cases like these where schedules of trial counsel from various cities and schedules of busy experts and top level scientific employees could be coordinated for the benefit of all concerned. We followed these procedures successfully and to the satisfaction of all in United States Gypsum Co. v. United States, 304 F. Supp. 627 (N.D.Ill. 1969). On October 30, 1969, almost a full year since the disposition of the passenger claims and having met only frustration in my attempts to dispose of this litigation I advised counsel that these cases, by this time the oldest pending in this district, were to proceed here immediately under the protracted litigation procedures or be transferred for the determination of liability as between the defendants to the Southern District of New York where the same issue was still pending in cases on the pretrial calendar and where a number of passenger claims were still unsettled.