Bondholders Committee v. Commissioner, 315 U.S. 189 (1942)

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Palm Springs Holding Corp. v. Commissioner of Internal Revenue


No. 503


Argued January 15, 1942
Decided Feruary 2, 1942
315 U.S. 185

CERTIORARI TO THE CIRCUIT COURT OF APPEALS
FOR THE NINTH CIRCUIT

Syllabus

Pursuant to a plan made by indenture bondholders of an insolvent corporation, a new corporation was formed which acquired more than one-half of the bond issue in exchange for shares of its stock issued to bondholder creditors, but none of which was issued to any present or former stockholder of the old corportion for any right of his qua stockholder, and the properties of the old corporation were bought in and acquired by the new corporation at trustee’s foreclosure sale. Held, a "reorganization" within the meaning of § 112(i)(1)(A) of the Revenue Act of 1932. Helvering v. Alabama Asphaltic Limestone Co., ante p. 179. P. 188.

119 F.2d 846 reversed.

Certiorari, 314 U.S. 8, to review a judgment sustaining a deficiency assessment which had been sustained in part by the Board of Tax Appeals.