Signal Oil Co. v. Commissioner
United States Tax Court
1. The extension by mutual agreement on July 30, 1936, of a two-year contract executed on July 31, 1934, which contract bound petitioner to refrain from dividend payments during its term but contained no provision for its extension or renewal, held to constitute a new contract, rather than a mere continuation of the old, so that petitioner is not entitled to credits by reason of a contract executed prior to May 1, 1936, restricting the payment of dividends. 2. Credit allowed…
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1. The extension by mutual agreement on July 30, 1936, of a two-year contract executed on July 31, 1934, which contract bound petitioner to refrain from dividend payments during its term but contained no provision for its extension or renewal, held to constitute a new contract, rather than a mere continuation of the old, so that petitioner is not entitled to credits by reason of a contract executed prior to May 1, 1936, restricting the payment of dividends. 2. Credit allowed by reason of a deficit which prevented petitioner under state law from declaring dividends. Sec. 501 (a) (2), Revenue…
1Opinion of the Court
OPINION.
Akundell, Judge:
The principal issue is whether, during the entire years 1936 and 1937, petitioner was bound by the provisions of a written contract executed prior to May 1,1936, to refrain from the payment of dividends. If it was, it is entitled to a credit to the extent of its adjused net income for each of the tax years. Revenue Act of 1936, sec. 26 (c) (l}. Petitioner executed a written contract on July 31, 1934, under the terms of which it agreed to pay no dividends, and respondent concedes that this contract would have been a proper basis for the credit if it had been in force…
2Cases cited9 opinions
- United States v. AndersonSupreme Court of the United States · 1926
- Ide v. LeiserMontana Supreme Court · 1890
- Quinn v. ValiquetteSupreme Court of Vermont · 1908
- Cummins v. BeaversSupreme Court of Virginia · 1904
- Carrano v. ShoorSupreme Court of Connecticut · 1934
4 more not listed; retrieve them via the Exa API.
3Cited by1 opinion
- Signal Oil Co. v. CommissionerUnited States Tax Court · 1943