United Cigar-Whelan Stores Corp. v. District of Columbia

EDGERTON, Circuit Judge.

For $30,000 paid 'by its lessors, petitioner as lessee consented to cancel a lease that had some years to run. The disputed question -is whether the cancellation was a “sale or exchange”. Gain ¡from sale or exchange of a capital asset is exempt from the District of Columbia income tax. 53 Stat. 1091, D.C.Code(1940) § 47 — 1506.

We agree with the Board of Tax Appeals that there was no -sale or exchange and petitioner’s gain was taxable. A lease that is cancelled is not transferred but terminated. Termination or destruction is not sale or exchange. Cf. Hale v. Helvering,…