Higgins v. Smith

delivered the opinion of the Court. \

Certiorari was allowed1 from the judgment of the Circuit Court of Appeals for the Second Circuit2 on account of an asserted conflict between the decision below and that *474of the Circuit Court of Appeals for the Seventh Circuit in Commissioner v. Griffiths.3

The issue considered here is whether a taxpayer under the circumstances of this case is entitled to deduct a loss arising from the sale of securities to a corporation wholly owned by the taxpayer. The statute involved is § 23 (e) of the Revenue Act of 1932.4

The Innisfail Corporation was wholly owned by the…