Creme Manufacturing Co., Inc., Plaintiff-Appellee-Cross v. United States of America, Defendant-Appellant-Cross

WISDOM, Circuit Judge:

The question for decision is whether the taxpayer’s excise tax liability should be based on the price at which it sold its product to a closely related promotion and sales corporation or on a constructive price, determined by the Internal Revenue Service, based on the price at which the related corporation sold the product to independent wholesalers.

Creme Manufacturing Company, Inc., the taxpayer, instituted this action in the district court to gain a refund of approximately $2,500 for overpayment of federal excise taxes. The United States counterclaimed for additional…