Helvering v. Metropolitan Edison Co., 306 U.S. 522 (1939)

Helvering v. Metropolitan Edison Co.

No. 486

Argued March 10, 1939
Decided April 3, 1939 *
306 U.S. 522

CERTIORARI TO THE CIRCUIT COURT OF APPEALS

FOR THE THIRD CIRCUIT

Syllabus

1. Upon a transfer by one Pennsylvania corporation to another of its franchises and assets, pursuant to the Act of April 29, 1874, of that State, as amended, the transferee becomes liable as matter of law for the obligations of the transferor. P. 528.

2. A transfer by one Pennsylvania corporation to another of its assets and franchises, in accordance with the above-cited Act of Pennsylvania, held tantamount to a merger, and that the transferee, in computing its income tax under the Federal Revenue Acts of 1926 and 1928, was entitled to deduct unamortized discount and expenses in respect of bonds issued by the transferor and retired by the transferee. P. 529.

3. A transfer by one Pennsylvania corporation to another of its assets, the transferee assuming all of the liabilities of the transferor, including bonds on which the transferee was already liable as guarantor, although it did not comply fully with the above-cited Pennsylvania Act, held a de facto merger entitling the transferee to a like deduction. P. 529.

98 F.2d 807; id., 812, affirmed.

Certiorari, 305 U.S. 592, to review reversals in two cases of decisions of the Board of Tax Appeals, 35 B.T.A. 1110, 36 id. 467, sustaining disallowances of deductions from income tax.