American Cigarette & Cigar Co. v. Bowers

L. HAND, Circuit Judge.

The question on which this action depends is the propriety of a deduction which the plaintiff sought to take from its gross income in computing its net income for the year 1924. It had been the holder of 48% of the shares of the Havana Tobacco Company, which owned all the shares of Cabanas y Caraba jal and of J. S. Murías y Ca., both cigar manufacturers in Havana. The plaintiff had lent large sums to J. S. Murías y Ca., and was its only creditor, except for Henry Clay & Bock Ld.— all of whose shares were also owned by the Havana Tobacco Company. The Mu-rías business…