had reserved to itself a considerable amount of discretion with respect to the determination of when conditions requisite to the payment of subsidies had been fulfilled.
It is enough to say that the present transactions undoubtedly gave rise to the same possibility of complex or contested issues of fact relating to compliance which led the court in the Costas case to label the determinations of the Secretary under the Sugar Act 'quasijudicial.' The nonministerial nature of Commodity's function is more apparent in light of other powers reserved to it in the contracts. Thus, Commodity, in its absolute discretion and on such terms as it might determine, could waive any performance required of the plaintiff. It had retained authority to alter procedures set out in the agreements and make interpretations of its terms. Even with the aid of section 1 of the contracts, such terms as 'place of delivery,' 'area,' or 'eligible sales' admit of no absolute definition, but, nevertheless, an exercise of Commodity's reserved right could result in a canner's receiving no subsidies at all. It should be noted that the proper application of the term 'eligible sale' gave rise to litigation involving other canners in at least two instances. Seabrook Farms Co. v. Commodity Credit Corp., 3 Cir., 1953, 206 F.2d 93; Harlingen Canning Co. v. Commodity Credit Corporation, 5 Cir., 1951, 193 F.2d 176.
Two other points of the defendant require mention. The first is that the taxpayer's true income picture would be distorted unless the income and the deductions attributable thereto are reported in the same year. The answer is that the decision in Security Flour Mills Co. v. Commissioner, 1944, 321 U.S. 281, 64 S. Ct. 596, 88 L. Ed. 725, clearly precludes the Commissioner from allocating income to a taxable year other than a year in which a fixed right to receive a reasonably ascertainable amount existed, regardless of whether a more equitable result would otherwise be achieved. United States v. Olympic Radio & Television, Inc., 1955, 349 U.S. 232, 236, 75 S. Ct. 733, 99 L. Ed. 1024. The second point is that the taxpayer actually did accrue in the years of the sales the amount of the subsidies it later received, with a small margin of error. It is well established that bookkeeping entries do not produce either income or losses for purposes of taxation, although in some circumstances they are of evidential value. Doyle v. Mitchell Brothers Company, 1918, 247 U.S. 179, 38 S. Ct. 467, 62 L. Ed. 1054; Commissioner of Internal Revenue v. Goldberger's Estate, 3 Cir., 1954, 213 F.2d 78; J. E. Mergott Co. v. Commissioner of Internal Revenue, 3 Cir., 1949, 176 F.2d 860; Northwestern States Portland Cement Co. v. Huston, 8 Cir., 1942, 126 F.2d 196. It is conceded that the plaintiff did make a rather accurate forecast of the amounts it would receive, although it may be noted that the difference between the amounts claimed and amounts approved should have as much significance here as similar differences had in United States v. Harmon, supra. Shorn of the latter consideration, the bookkeeping entries do not prove that the liability of Commodity to make subsidy payments was fixed since that liability was determined by circumstances not necessarily reflected in the taxpayer's keeping of books.
Conclusions of Law
1. The court has jurisdiction of the subject matter and of the parties.
2. The subsidy payments received by the plaintiff were accruable in the fiscal years in which the respective applications therefor were audited and approved by the Commodity Credit Corporation.
3. The plaintiff is entitled to judgment in accordance with the foregoing findings of fact and these conclusions of law.
The parties have agreed, in the event of a decision for plaintiff, to stipulate the amount of recovery of tax and interest. Accordingly, entry of orders for final judgments will be deferred pending receipt of the stipulation.