General Utilities & Operating Co. v. Commissioner

*938OPINION.

Aeundell:

The respondent has determined that income was realized from the transactions detailed in the findings of fact and has asserted a tax thereon. His theory is that upon the declaration of the dividend on March 22, 1928, petitioner became indebted to its stockholders in the amount of $1,071,426.25, and that the discharge of that liability by the delivery of property costing less than the amount of the debt constituted income, citing Kirby Lumber Co. v. United States, 284 U.S. 1.

There are a number of decided cases somewhat similar to this, in some of which it has been held that…