In re Sentinel Oil Co.

JENNEY, District Judge.

This case arises on objections by the Collector of Internal Revenue to the report of the Special Master. The material facts are as follows: Sentinel Oil Company was organized in 1934 as a California corporation. The corporation purchased several parcels of land at Long Beach and received deeds conveying to it a large percentage of the fee. The balance of the fee was retained by the grantor, with the understanding that the vendee was to drill a well on each of the parcels and that the grantors would have a designated percentage in the proceeds from the well. The…