Atlantic Co. v. Commissioner

HOLMES, Circuit Judge.

By means of a written contract executed prior to May 1, 1936, petitioner secured a line of credit from the First National Bank of Atlanta. The question is whether that contract prohibited the payment of dividends within the taxable years 1936 and 1937 so as to entitle it to a credit against the surtax on undistributed profits as provided by Section 26(c) (1) of the Revenue Act of 1936, 26 U.S.C.A. Int.Rev.Acts, page 836.

The written contract relied upon by petitioner arose out of a letter from the bank to the president of the taxpayer corporation dated October 10, 193S,…