United States Steel Corporation, Appellant-Cross-Appellee v. Commissioner of Internal Revenue, Appellee-Cross-Appellant

LUMBARD, Circuit Judge:

This consolidated appeal 1 from two decisions of the Tax Court, Quealy, J., arises out of the development by United States Steel Corporation (“Steel”) of newly discovered Venezuelan iron mines in the 1950’s, and the financial arrangements resulting from the creation of two Steel subsidiaries to mine and transport ore. Two distinct questions of tax law are presented: first, what kind of evidence is sufficient for a taxpayer to challenge successfully the Commissioner’s determination that payments between a parent and a subsidiary are not “arm’s length” and thus are…