Standard Oil Co. (Indiana) v. Commissioner

OPINION

Naum, Judge:

The dispute between petitioner and the Commissioner centers on whether during the years in issue Pan American retained an “economic interest” in the properties transferred to Pacific. The parties appear to agree that if Pan American retained an economic interest in the properties, Pan American’s receipts in 1958 and 1959 represent ordinary income to it, subject to depletion, but that if it retained no such interest, the receipts reflect capital gain realized by Pan American on the sale of property used in its trade or business.

The petitioner contends that as of January 1,…