Western Cartridge Co. v. Commissioner

OPINION.

Van Fossan, Jvdge:

The first question to be considered is whether the repayments in 1942, of $2,150,000 on contract No. W-OKD-481, $633,583.05 on contract No. 478 ORD-3, and $1,971,111.52 on contract No. 478 ORD-40, of moneys received by petitioner from the Government under the respective contracts entitle it to a credit for debt retirement under section 783 of the Internal Revenue Code. The determination of this question is dependent upon whether the advance payments constituted an “indebtedness” within the meaning of section 783 (d), which is as follows:(d) Definition of…