Beneficial Industrial Loan Corporation v. Handy, 92 F.2d 74 (3d Cir. 1937)

Jackson R. Collins, of New York City, for appellant.

James W. Morris, Asst. Atty. Gen., and J. L. Monarch and F. E. Youngman, Sp. Assts. to Atty. Gen., for appellee.

Before BUFFINGTON and BIGGS, Circuit Judges, and DICKINSON, District Judge.

PER CURIAM.

In the court below, taxpayer, appellant, brought suit against the Revenue Collector to recover income taxes illegally, as contended, collected from it. By stipulation, jury was waived and the case tried by the judge, who found in favor of the collector. Thereupon taxpayer took this appeal. Reference to the opinion of the court, reported in (D.C.) 16 F. Supp. 110, avoids a present repetition of the facts and circumstances of the case.

The sole question involved is whether certain sums expended by the taxpayer for professional services rendered in the general examination and review of operations of certain companies taken over in a reorganization effective December 31, 1929, is deductible from gross income when paid either as an ordinary and necessary business expense incurred during the taxable year in carrying on its trade or business or as a loss sustained during the taxable year and not compensated for by insurance or otherwise.

After hearing and consideration, we are of opinion the court committed no error and that on its own reasoning and the cases of Simmons Co. v. Commissioner (C.C. A.) 33 F.(2d) 75, and Corning Glass Works v. Lucas, 59 App.D.C. 168, 37 F.(2d) 798, 68 A.L.R. 736, its judgment should be, and hereby is, affirmed.