T. L. Townsend, Acting District Director of Internal Revenue v. The Hitchcock Corporation

DOBIE, Circuit Judge.

This appeal is by the United States, through T. L. Townsend, Acting District Director of Internal Revenue, from a judgment in favor of The Hitchcock Corporation (hereinafter called the taxpayer), which is engaged in mining talc at Murphy, North Carolina. Taxpayer’s mining activities consist of extracting the talc from its deposit underground, bringing it to the surface, cutting such talc as is suitable for the purpose into crayons, and pulverizing or grinding the remainder of the talc.

The question before us relates to the income tax deduction for depletion for this talc.…