International Ticket Scale Corp. v. United States

CLARK, Circuit Judge.

The Revenue Act of 1936, § 14, 26 U.S. C.A. Int.Rev.Acts, page 823, levied a tax upon that part of the corporate net income which had not been distributed as dividends. Cf. New York Stocks, Inc. v. C.I.R., 2 Cir., 164 F.2d 75. Section 26(c) (3) of the same Act, as amended by § 501(a) (2) of the Revenue Act of 1942, 26 U.S. C.A. Int.Rev.Acts, page 344, allows a credit where “the corporation is prohibited by a provision of a law or of an order of a public regulatory body from paying dividends during the existence of a deficit in accumulated earnings and profits.” Moreover,…