Commissioner of Internal Revenue v. The American Metal Co., Limited, the American Metal Co., Limited v. Commissioner of Internal Revenue

HINCKS, Circuit Judge.

The taxpayer whose petition is before us, is a New York corporation which owns over 98% of the voting stock of Compañía Minera de Penóles, S.A., a Mexican corporation (hereinafter referred to as “Minera”). Minera, from 1924 through 1947, has been in the business of mining, milling, smelting and refining non-ferrous metals. In 1934, the smelting and refining operations were carried on by a Mexican corporate subsidiary of Minera, called Metalúrgica. In 1947, Minera paid a taxable dividend to its shareholders in United States money in the amount of $8,250,000. Of this…