Sarther Grocery Co. v. Commissioner
United States Board of Tax Appeals
1. The terms "sale" and "exchange" are to be applied to promote the intendment of the taxing act, and, while for other purposes they may be interchangeable, for its own purposes the revenue act applies the word "sale" to a transaction in terms of money. 2. Petitioner agreed to "sell, transfer and deliver" its property to another corporation and to distribute its assets among its stockholders and dissolve.
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1. The terms "sale" and "exchange" are to be applied to promote the intendment of the taxing act, and, while for other purposes they may be interchangeable, for its own purposes the revenue act applies the word "sale" to a transaction in terms of money. 2. Petitioner agreed to "sell, transfer and deliver" its property to another corporation and to distribute its assets among its stockholders and dissolve. At the same time its stock was surrendered and the purchase price was paid to petitioner, and, after payment of debts, the remainder was distributed to its stockholders. Neither petitioner…
1Opinion of the Court
*1276OPINION.
Sternhagen:
Although, in words of common speech, the petitioners sold their assets for cash, an elaborate argument is offered to demonstrate that the transaction was an “ exchange,” and therefore requires consideration of section 203(b) and (e), Revenue Act of 1926, and, furthermore, that it was a “ reorganization,” as defined in that section, and hence that no gain or loss on the “ exchange ” will be recognized. The argument is so plainly unsound that its fallacy is demonstrable in a few words.
The terms “ sale ” and “ exchange ” are to be applied to promote the intendment of the…
2Cited by3 opinions
- Edison Sec. Corp. v. CommissionerUnited States Board of Tax Appeals · 1933
- Edison Sec. Corp. v. CommissionerUnited States Board of Tax Appeals · 1933
- Sarther Grocery Co. v. CommissionerUnited States Board of Tax Appeals · 1931