Chilhowee Mills, Inc. v. Commissioner of Internal Revenue

152 F.2d 137 | D.C. Cir. | 1945

PRETTYMAN, Associate Justice.

This is a companion case to H. A. Vestal, Sr., Transferee, v. Commissioner of Internal Revenue, No. 9025, 80 U.S.App.D.C. -, 152 F.2d 132, decided simultaneously herewith. The facts are fully stated in that opinion.

The question here is whether an assessment against Chilhowee Mills, Inc., a corporation in dissolution, was barred by the statute of limitations on July 17, 1943, when the deficiency notice to appellant was mailed by the Commissioner. The question is of academic interest only, since we have held in No. 9025 that assessment against the transferees of the assets of the corporation was not barred by limitation, and it is agreed that the dissolved corporation has no assets from which collection might be made.

The sole item of income involved in this proceeding is the gain on the sale of certain-real estate in October, 1938. Chilhowee Mills, a partnership successor to Chilhowee Mills, Inc., filed on September 15, 1939,¹ a partnership return in which the gain on the sale, and all pertinent data relative thereto, was reported. The Commissioner contends that that return was not a return by the corporation within the meaning of Section 275(a) of the Reverme Act of 1938,² and no other return having been filed by the corporation, the tax might be assessed at any time.³

In view of all the facts, we think that the return filed was a return within the meaning of the statute, and that therefore the three-year period of limitation began to run on the date of that filing. We rely upon Ger-mantown Trust Co. v. Com’r, 1940, 309 U.S. 304, 60 S.Ct. 566, 84 L.Ed. 770. It follows that the notice of deficiency of July 17, 1943, was not timely.

Decision reversed.

2 Sec. 275(a), I.R.C. 26 U.S.C.A. Int. Rev.Code, § 275(a).

3 Sec. 276(a), I.R.C., 26 U.S.C.A. Int. Rev.Code, § 276(a).

1 The transaction in October 1938 fell within the fiscal year ended June 30, 1939, for which the return was made.