EAU Claire Book & Stationery Co. v. Commissioner of Internal Revenue

EVANS, Circuit Judge.

The Board of Tax Appeals disallowed a deduction made by petitioner in its 1922 income return and ‘assessed its tax accordingly; hence this appeal. The facts are:

The Gillette Rubber Company was indebted to petitioner on accounts receivable and notes in the amount of $13,378.06. After the affairs of- this debtor were turned over to a creditors’ committee, petitioner accepted the notes of said committee for the full amount of the debt, and on November 21, 1921, it exchanged such notes for bonds of the company, of the par value of $14,000. These bonds were sold to…