of Internal Revenue's disallowances of (1) long term capital gains reported by the individual taxpayers which the Commissioner considered as being in substance dividends received by them, and (2) a capital loss on the ground that actually no loss was sustained because the corporate taxpayer had purchased and sold the shares for the same price, and that the additional claimed cost was the dividend received by two of the individual taxpayers. The taxpayers' motions for summary judgment raise the question, on the facts submitted to us, of the correctness of the disallowances.
The claimed gains and loss arose from the transfer of stock of the Dreifus Steel Corporation. In each instance the corporate taxpayer was on the conveying or receiving end of the transfers. From the averments of the complaints, answers, stipulation, depositions and affidavits, the facts are taken to be as follows:
1. The Charles Dreifus Company ('Company') was organized in 1936 and thereafter engaged in the business of buying and selling scrap metals. The outstanding stock, consisting of 1,000 shares, in the Company was owned as follows:
Hiram Winternitz, Jr. 167
Mrs. Hiram Winternitz, Jr. 500
Walter S. Gates 83
Mrs. Walter S. Gates 250
© 1992-2004 VersusLaw Inc.