Maid of the Mist Corporation and Affiliated Corporations v. Commissioner of Internal Revenue

MOORE, Circuit Judge:

I

Maid of the Mist Corporation (“taxpayer”) is a New York corporation with its main office located at Niagara Falls, New York. Its principal business is the operation of excursion boats at the foot of Niagara Falls. Sometime prior to December 16, 1971, taxpayer decided to expand its fleet of excursion boats. On December 16, 1971, James V. Glynn (“Glynn”), taxpayer’s president, met in Port Dover, Ontario, with representatives of Hike Metal Products, Ltd. (“Hike”), a Canadian shipbuilding concern which had previously built excursion boats for taxpayer. At this meeting, a…